• How to cancel a flat buyer agreement by the buyer

I signed a registered agreement in Himachal Pradesh to buy a 3 bedroom flat in August 2017 on a 3 year payment plan. I have made all payments on time. The possession date was in December 2017 with a grace period of 1 month. The builder has now changed his attitude now and is not replying to any calls etc. We went to check the apartment today and no development of the apartment has been made from the day I bought it. The developer is behaving in a very rude way and also asking for  12% GST on all payments made by cheque.
Until now I have paid a token amount of 1 lakh, at the time of agreement 10 lakh and 1 installment of 6 lakh , 12% GST on all payments and 1 lakh for transformer. The developer refuses to reply to any of my messeges or talk to me , if he does talk it’s in a very rude manner and mostly harasses me or threatens me by saying he will not give me the possession until al payments have been made. 
As per the agreement , possession is listed in December 2017 with 1 month grace period. 
As I am a NRI, I can’t come to India again and again to keep a track of the development etc so I have decided to cancel the agreement. 

The developer says that he will forfeit the entire booking amount of 10 lakh (at the time of agreement) + 1 lakh ( token) , however no such Claus is mentioned in the agreement. The only clause regarding forfeiting the booking amount is if the buyer defaults on the payments.  No specific booking amount is mentioned in the agreement . 10 lakh is started as the amount paid at the time of agreement. 
I have 2 questions - 
1. What are my legal options to cancel the agreement? My address in the agreement is my address in Denmark as well as my address in patiala. 
2. The gst is applicable on property under construction , if I get the possession in January as per the contract, is the gst still applicable for the remaining payments? 

Please note that it’s a 99 year old lease flat because a non resident can’t buy land in Himachal, only lease
Asked 8 years ago in Property Law
Religion: Sikh

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10 Answers

Hi

An agreement can be cancelled before it have been accepted.

Means yours cannot be cancelled as the offer if the flat was done and it has been already accepted by you and an agreement cannot be cancelled after the acceptance.

Wait till January. Let the grace period for possession finish , that would be good time to ask for refund via making complaints to the concerned authorities. Like the authorities which approved his site for construction or the authorities which approved him as a registered constructor.

Thank You

Rahul Jatain
Advocate, Rohtak
5365 Answers
4 Consultations

1) if builder fails to deliver possession you can cancel agreement and seek refund of money paid by you with interest

2) GST is applicable for remaining payments

3) if builder fails the refund file complaint before consumer forum against builder before consumer forum and seek orders to direct builder to refund your money with interest and seek compensation for mental torture undergone by you

Ajay Sethi
Advocate, Mumbai
99809 Answers
8147 Consultations

1. You can file a complaint case before the local District Consumer dispute Redressal Forum against the builder alleging deficiency in service and unfair business practice after the grace period of giving you possession claiminfg refund of your money paid with interest, damage and cost. It is a good case to win.

2. The liability to pay GST for already constructed house is not yet clear. In my own case when I am purchasing a property from the builder in a joint venture with Govt. of W.B.,, for which 80% of the amount was already been paid before the concept of GST was introduced, I have been told by the builder that I won't have to pay GST on the amount already paid by me.

Krishna Kishore Ganguly
Advocate, Kolkata
27703 Answers
726 Consultations

1.This developer is a crook and you must teach a hard lesson.

2.i am sure you have some relatives living in india. So through him lodge a complaint of cheating in local police station.

3.thereafter file a case beofre he consumer forum. Before that send a notice cancelling the agreement and seeking full refund.

4.in the consume forum you will get full refund along with interest. Award of damages and compensation will be extra.

5. yes, GST is applicable on the payment which you paid after the date when GST Became effective in India.

Devajyoti Barman
Advocate, Kolkata
23655 Answers
537 Consultations

you can cancel the agreement as builder has failed to deliver possession of property on due date

2) on cancellation you are entitled to refund of your money

3) if builder fails to refund take legal proceedings as advised herein above

Ajay Sethi
Advocate, Mumbai
99809 Answers
8147 Consultations

1. You can cancel the agreement to sell by serving a lawyer's notice to the builder and demand the refund of money paid to him thus far with interest. If builder does not refund the money then file a complaint case in the consumer forum to seek the refund of principal amount with compensation for deficiency in service.

2. GST has to be paid on the payments made by you after it became effective.

Ashish Davessar
Advocate, Jaipur
30840 Answers
981 Consultations

1. There should be a valid ground/reason for cancelling the agreement. The reason shown by you is not an acceptable ground/cause for cancelling the said registered agreement. You shall have to pick up cause/ground out the fault/deficiency of the builder in complying with the terms mentioned in the said agreement.

2. He is bound by to give you possession of the said flat by December'2017 with a grace period of one month which he won't be able to do for sure.

3. So, you shall get the ground to cancel the agreement on the ground that the builder has not complied with the terms mentioned in the said registered agreement entered in to and between you two in connection with the term of giving physical possession of the flat to you.

4. You can get the plaint ready and file it in the month of February'2018 before the Consumer Forum as advised in my earlier post.

Krishna Kishore Ganguly
Advocate, Kolkata
27703 Answers
726 Consultations

Dear Client,

Instead opting for civil recovery, file FIR against for cheating. fast recovery.

Than file for Civil recovery, if police not cooperate.

1. What are my legal options to cancel the agreement? My address in the agreement is my address in Denmark as well as my address in patiala. -- Either for specific performance, recovery of possession/payment due to default by owner. Check if the project is registered with RERA ( Real State Regulatory Authority ) as it is mandatory, than file complain to RERA. Consumer Case.

2. The gst is applicable on property under construction , if I get the possession in January as per the contract, is the gst still applicable for the remaining payments? --- Applicable for payment made after GST come into existence but not on previous payments.

Yogendra Singh Rajawat
Advocate, Jaipur
23082 Answers
31 Consultations

I have 2 questions -

1. What are my legal options to cancel the agreement? My address in the agreement is my address in Denmark as well as my address in patiala.

If the builder is violating the conditions of agreement, you can cite the same and invoke the conditions governing ther violations while communicating your decision to cancel the booking for the said reasons.

You can send the communication by a registered post to the builder.

This can be followed by a lawyer's notice or a consumer complaint case within the jurisdiction where the property situate.

2. The gst is applicable on property under construction , if I get the possession in January as per the contract, is the gst still applicable for the remaining payments?

The Goods and Services Tax (GST) rate of 12 percent will be applicable on under-construction properties.

The schedule of GST rates for services as approved by the GST Council said that the “construction of a complex, building, civil structure or a part thereof, intended for sale to a buyer, wholly or partly. The value of land is included in the amount charged from the service recipient.” These will be taxed at 12 percent with full input tax credit.

T Kalaiselvan
Advocate, Vellore
90010 Answers
2496 Consultations

What I meant to ask is If there is any legal way out of the agreement citing any other reason because I don’t want to buy that flat anymore due to the builders attitude. That was my holiday home and I don’t want to buy it anymore there (the builder also lives in the neighbourhood in the same apartment building)

As the agreement has no Exit Claus there must be some law concerning buyers who want to cancel an apartment sale , before the registeration.

You dont worry about the exit clause.

Let there be no such clause, the builder's attitude itself is enough for you to approach court

You first initiate step to cancel the booking by communicating your decision through a letter sent by registered post.

Let the builder give a reply after which you can plan further action as per law.

There is no unilateral or lopsided condition governing anything which involves two people.

T Kalaiselvan
Advocate, Vellore
90010 Answers
2496 Consultations

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