• Registration and stamp duty on pre-construction property


I am an NRI and have purchased a pre-construction property in Mumbai. I have paid 26% of the agreed value of the home and have an allotment letter for the unit. I want to get an agreement made between myself and the developer. I am told/read that to have an agreement, the property needs to be registered and I need to pay stamp duty. Can you please advise if this is the law? Or can I have an agreement with the developer without registering the property yet (since it is not complete)? If an agreement is not possible without registration, then is there something other than the allotment letter that I can have from them that will be more valuable?

The reason I ask this is because the stamp duty is a sunk cost. Tomorrow if the builder does not complete the project, even though the agreement might help me recoup money, the large stamp duty will never be recovered from the government.

Further, is it also necessary for to register the property since I have paid more than 20% of the agreed costs. Is there some Maharastra law stating that?

Separately, I do not have anything in writing from the building on the fittings and furnishings in the unit. Can this information be part of an agreement? If not, can there be another signed document between myself and the builder with regards to fittings and furnishings that are currently not a part of the allotment letter? What is the value of such a document?

Appreciate your help. Thanks.
Asked 2 years ago in Property Law from United States
Religion: Hindu
An agreement to sell can be registered once the developer gets permissions, such as commencement certificates and sanctions for the project plan

2) it is compulsory to register an agreement to sell with the sub-registrar and pay the relevant stamp duty if the developer takes more than a fifth of the total cost of the flat.

3) in your   case since more than 26 per cent consideration had been paid agreement for sale requires registration 

3) Paying stamp duty and registering the agreement will also prevent the realtor from re-selling the house to someone else

4) fittings and furnishing can form part of the agreement 
Ajay Sethi
Advocate, Mumbai
46908 Answers
2775 Consultations

5.0 on 5.0

1. Have you purchased the said flat or just booked it by paying 26% of its price?

2. In normal case, the developer and the buyer enters in to an agreement for sale of the said booked flat which should be registered to have legally enforceable value,

3. Agreement for sale is generally registered when even the first brick has not been laid, leave aside completion of construction of the property. This is the agreement where in both the parties agree to sell and buy the property at a price fixed and at mutually acceptable terms.

4. Get the agreement of sale executed and do not pay any further unless the same is executed,

5. Property is not registered but the title deed only is registered. In your case the agreement vfor sale and finally the sale deed shall have to be registered,

6. Details of the property which you are going to buy shall have to be mentioned in the Agreement for Sale including the specification of the bath room fittings, tiles etc.
Krishna Kishore Ganguly
Advocate, Kolkata
18818 Answers
454 Consultations

5.0 on 5.0

1 The sake agreement is though preferred to be registered , need not be registered.
2. Only on payment of full consideration money you can register the final deed of sale.
3.  However if you register the sale agreement of stamp duty on market price of the proeprty , at the time of registration of final sale deed you need not pay stamp duty once again though you will have to pay registration fees once again.
4. The fittings and fixtures are not required to be mentioned at all in sale deed though it can be mentioned in sale agreement.
5. The sale agreement must bear details of the those fittings and fixtures.
Devajyoti Barman
Advocate, Kolkata
13191 Answers
175 Consultations

5.0 on 5.0

For all the practical purpose, a registered sale agreement shall be held as a valid document. 
Any claim or litigation i future in this regard cannot be challenged on the basis of an unregistered document. 

The stamp duty cannot be recovered from the government  but the property itself will be at stake when there is some serious issue on it at a later stage.

Any agreement relating to the immovable property and transfers of the same are to be registered as per Maharashtra laws. 

You have to get everything mentioned in the sale agreement as the conditions of sale agreement between you and the builder. 
T Kalaiselvan
Advocate, Vellore
37100 Answers
403 Consultations

5.0 on 5.0

What you require is an agreement to sell with the developer, which you should have ideally made at the time of or before remitting the advance to him, not a sale deed. The agreement to sell does not have to be registered, so there is no question of payment of stamp duty. You are being grossly misled on purpose.
Ashish Davessar
Advocate, Jaipur
23180 Answers
641 Consultations

5.0 on 5.0

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