Cancellation of a verbal agreement to sell property by seller by refunding of token advance of 25000

Dear Sir/Madam, I engaged in a verbal agreement for sale of property representing a family friend, with an individual affiliated with the intelligence wing of the CID, Bangalore, on 12th November 2022. As part of the agreement, we received a token advance of 25,001 INR. The understanding was for the buyer to pay the agreed-upon sum of 83 Lakhs and complete the site registration by the end of December 2022. However, due to missing documents, we requested an extension until the end of January to procure the necessary paperwork. The buyer, without proceeding with the registration, suggested delaying the process until June or July 2023, citing the need for a newspaper advertisement. In April 2023, we withdrew from the deal, citing personal reasons, and returned the token advance of 25,001 INR. Subsequently, the buyer insisted on a legal charge of 25,000 INR, originally 50,000 INR, which we declined to pay. He provided us with certified copies of certain documents, initially stating that, as a member of the police force, he obtained them without any bribes. Upon our withdrawal from the agreement, he started demanding 7,500 INR for these documents. While we acknowledged the request during a challenging period, we did not commit to payment and promptly returned the token advance. Recently, as we sought a new buyer and were finalizing a deal, the previous buyer, accompanied by his colleague residing near our property, confronted the new buyer, asserting a prior agreement and threatening legal action. Initially, I contemplated paying the requested 7,500 INR to avoid complications, but the unwarranted threats have compelled me to reconsider. I am seeking advice on whether there is a legal obligation to make any additional payments and whether the previous buyer has a legitimate standing to interfere with the current property sale. Your guidance in this matter would be greatly appreciated. Sincerely,