1. Yes 10 percent will be Forfeited as per rera rules and rest will be refunded
2. It has merit.
3.yes advocate can do it alone
4.Its is in buyers favour
Cancellation of booking of apartment and forfeiture warning from builder
Dear Sir I am a NRI working in Qatar .I have booked one apartment in Cochin in February 20 at 10% of the sale consideration as booking amount , around 16 Lakhs .The sales team was pressurising saying its a group booking and fetching some good discount.In a hurry the application (A totally biased one)was signed and scanned and send to them and booking amount transferred .It was a ready to move apartment hence allotment letter was got in a week time. Mean time Covid 19 hit badly and job security was a point of concern.The travel ban was imposed from Qatar to India so could not initiate the agreement for sale.On this ground as a force majour I intimated builder to cancel my booking. The builder builder not bothered of the situation,and threatening to forfeiture entire amount. There is clause mentioned in booking application 10% full sale consideration will be forfeited after issuance of allotment letter. My questions:- 1.There is no official agreement done ,so is it legally binding to claim from buyer 10% of full sale consideration.I am ready to give 10% of booking charge 2.what is the merit on this case on legal side through consumer forum to get the payment back. 3.As I am working at overseas and my travel to India is limited , such cases an advocate can alone run the case. 4.How long normally such cases last for a firm verdict Kindly advice Krishnakumar
Asked 4 years ago in Property Law
Religion: Hindu
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17 Answers
1. Several Judgement's in similar matters have decided that "Booking Amount" cannot be forfeited under any circumstances and that Builder is bound to return the same, PROVIDED an agreement of any kind is not executed.
2. Even AFTER execution of an agreement, IF the buyer party proves any negligence /deficiency /delay /improper construction /etc.... on part of the Builder, THEN too the buyer party is entitled to 100% return of any amount given so far alongwith Interest under the RERA rules.
3. You have an positive option to file a grievance petition against the Builder /Developer, in the local Consumer Court, for their illegal trade practice, negligence, deficiency, harassment, intimidation, cheating etc.... with proper documentary evidences and you can claim damages /compensation & interest on your investment, and for your physical & mental trauma.
4. Since you are outside India, you may delegate authority (via a POA) to a friend /relative to file above Petition on your behalf and you need be present in court or in India.
The builder is liable to pay you the entire amount if the agreement is not registered. He could have deducted 10% of the booking amount if the agreement was registered but in your case he cannot deduct any money out of the advance payment you have made for the booking.
So you may proceed to file a case before the consumer forum by giving power of attorney to a person residing in the concerned city so that he may pursue the case on your behalf and even that person will not be required to go to the court except for a very few occasions and the advocate engaged can pursue on his own.
With regard to time it can take anywhere between 1- 1.5 years if matter is pursued delegently with vigour however it is hard to predict a time and there are many external factors at play especially due to the current situation.
Just remember to inform your advocate and send him a copy of all the communication made with the developer so that he may frame the case in light of the reason given by you in your mails (if any) because if you have given one reason not to go ahead and he gives another in the petition, then it may seem like you have not come to the court with clean hands and it may go against you.
Builder can in event of cancellation of booking forfeit the booking amount
2) cases before consumer forum take 2 years to be disposed of
3) you can engage any lawyer for appearing on your behalf
1. This is the common unfair trade practice most of the builders indulge in which often doesn't sustain once challenged before the court of law.
2. There are umpteen number of cases where we have managed to bring back full refund along with enough damages and compensation . So terms of agreement does not make any difference.
3. Yes. We can handle in your absence.
4. It depends but 1-2 years is usual time line.
Hi
Pursuant to an amendment in Consumer protection act in 2019, unfair trade practices and unfair contracts are subject matters listed before the consumer forum.
Also in various judgments, Supreme court and consumer forum have always stated that
a) Builder cannot withhold the booking amount citing contract as the contracts between flat owners and builders are one sided favouring the builder and in the event of cancellation of booking, builders can retain up to 10% of monies so paid by the flat buyer.
b) You have a valid case
c) In consumer forum, only lawyers appear and all you need to do is sign papers before indian embassy officials and send it over to your lawyer.
d) In places like cochin, the time line would be about 12-15 months for your complaint to come to a closure at a district forum/state forum
Hope this information is useful.
Do not go to the consumer forum. Instead file a complaint against him in the RERA tribunal immediately.
1. No builder is not bound to receive amount.
2. Proceed with the complaint
3. Yes advocate can run the case.
4. 1 year approx
Dear Sir,
Some decision of consumer court are in favour of the builder in regard to booking amount. However, the legal notice can be served and the case may be filed. Your personal presence in consumer forum is not necessary and you may send the vakalatnama, singed and authenticated application/petition at Indian consulate of Qatar. Your advocate will handle the case and it may take 02 years or so for the decision of the case. Alternatively, you may give SPA to someone in India and he/she may pursue the case here.
- There is no guidelines laid down by the government to forfeit the booking amount for the cancellation, and the deduction is done at the builder’s discretion.
- Hence, legally, the builder cannot deduct any money out of the advance payment you have made for the booking till the time; a builder-buyer agreement is made and registered with the sub-registrar.
- Further, A builder-buyer agreement is not created until the buyer pays at least 10 per cent of the property value.
- Further, as per Real Estate Regulation Act (RERA), home-buyers can cancel allotment of the apartment booked with a builder at any stage even if there is no default on the part of the developer. The builder is bound by law to return the money collected from buyers within 45 days, after deducting the booking amount.
- Hence, if you have already paid 10 percent of the flat value, and the said agreement signed by you , is not registered in the office of the Registrar , then you are liable to get full amount refund paid by you ,even there is a clause present in the agreement for not refunding , and if the said agreement is registered , then builder has right to deduct booking amount from the paid amount.
- If, builder not refunding the same ,then you should lodge your complaint before the Consumer court , and thereby prayed for the refund of paid amount with interest.
1.As i mentioned above
2. Can claim full refund
3. Yes, your appearance is not mandatory
4. 3 to 9 months.
Good luck and dont forget to rating Positively.
Legally, the buildee cannot deduct any money out of the advance payment you have made for the booking till the time a builder-buyer agreement is made and registered with the sub-registrar.
1. If the agreement to sale (ATS) has not been entered into then the builder cannot forfeit any part of the sum paid to him unless the allotment letter contains a clause for cancellation charges/forfeiture of advance.
2. In your case as there is a clause for cancellation charges, it can be invoked by the builder.
3. Force Majeure does not work to whittle down your liability to be saddled with cancellation charges.
1) Cancellation charges deduction is valid.
2) Excluding the cancellation charges you can get back the balance.
3) Yes, authorize one of your family members to represent you for filing the case, rest can be taken care by your advocate, but for giving evidence you need to be present, which may happen some time later.
4) Going by present situation, it may take some where between 3 to 5 years, after commencing the court work.
This is a totally one-sided clause in terms of which the builder is contemplating to forfeit the entire sum of 16 lacs paid by you as an earnest.
Forfeiting entire 16 lacs would amount to an unfair trade practice.To discourage home buyers from cancelling the allotment, the builders put stringent clause in the agreement allowing it to forfeit a substantial amount deposited by buyers.
NCDRC has recently held that real estate company cannot cannot invoke such harsh clause in cases where the buyers are forced to seek cancellation due to any compelling circumstances.
The builder cannot forfeit the amount like that. Send him a legal notice.
1. No builder cannot claim 10% of total sales consideration as forfeiture amount.
2. Merits are in your favour because developer or builder cannot forfiet complete booking amount.
3. Yes but you need to be present at time of your evidence in court.
4. It may take around year or two for disposal of case.
1. This is a lopsided agreement hence cannot stand it grounds when challenged before consumer court.
2. There's a supreme court judgment in your favor hence you can very well proceed.
3. Your advocate can handle the during your absence.
4. It may take at least three years or more.
