Earnest money as cancellation charges
I had purchased an under construction property in Ghaziabad in the year 2012. Till date, the construction progress is poor. I have been told by the builder representatives that few approvals (like map approvals) are still pending with Ghaziabad development authority. No such information was presented to me at the time of booking.
Left with no other option, I wish to cancel my booking.
Please refer to below clause from builder-buyer agreement related to cancellation-
“In the event, the payment is not received within 30 days from the due date given in the Installment Call Notice issued by the Company or in the event of breach of any of the terms and conditions of this Agreement by the Allottee, the allotment will be cancelled and 15% of the value of the flat will be forfeited and the balance amount will be refunded to the flat allottee without any interest. It is clarified that the amount mentioned hereinabove shall be deducted as a reasonable pre-estimate of loss suffered by "The Company" by reason of your breach in not complying with your obligation under the terms of this agreement.”
Also, in the application form there are clauses-
“1. The applicant agrees that the amount paid with the application and in installments as the case may be, to the extentof15% of sale consideration of the Residential Flat shall collectively constitute the earnest money.”
2. Timely payment of installments of basic sale price and allied charges pertaining to the Residential Flat is the essence of the terms of the booking/ allotment. However in the event of breach of any of the terms and conditions of the allotment by the applicant, the allotment will be cancelled at the discretion of the Company and the earnest money that is 15% of sale consideration together with any interest o installments due but unpaid and interest on delayed payments shall stand forfeited. The balance amount shall be refundable to the applicant without any interest, after the said Residential Flat is allotted to some other intending applicant and after compliance of certain formalities by the applicant.”
The builder is telling me that 15% of the total amount will be deducted even in case of willful cancellation by buyer. Please advise.