Default on Payment Plan - Penalty
Hello team, today (13/MAR/19) I received email from the builder with subject as 'Provisional Allotment of the Residential apartment'.. The letter advises of the provisional allotment of the apartment and acknowledges the initial booking amount ('Earnest Money - Rs. 51000/-') that was collected..
The letter then notes that I am required to pay per earlier agreed payment plan (linked with the building slab construction schedule and basis 'on demand' from the builder).. Defaulting on this, payment default penalty of Rs. 10000/- be levied until outstanding amount and applicable penalty amount is paid up in full..
The letter goes on to say that I agree with the developer that - Builder will share timely building construction completion progress status.. Any such intimation be considered sufficient proof this effect.. However failure to receive any payment notice should not be ground for excuse for non payment of installment dues and builder will be entitled to levy default penalty of Rs. 10000/- per day in such cases..
The letter also suggests that the developer/builder reserves the rights to cancel allotment if installment + due penalty remains unpaid for 30 days.. in such case, collected Rs. 50000/- be forfeited and remaining amount be paid back in 45 days without interest..
What I also realise that the letter is back dated to 10/SEPT/2018.. I am asked to sign, acknowledge the letter and return its copy back..
Can you please help review and advise
a) Is builder within his rights to seek such an agreement from home buyers?
b) What is the maximum penalty that developer/builder can levy on home buyers? (Apartment cost including GST, stamp duty and registration charges is ~ Rs. 4000000/- and stated penalty calculates to ~0.25% per day or ~92% annually)
c) In absence of payment demand letter, how do I instruct my bank to release payment to the builder?