‘Builders must execute agreement after accepting booking amount’ | mumbai | Hindustan Times
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‘Builders must execute agreement after accepting booking amount’

Builders must execute a flat-purchase agreement with buyers immediately after accepting the booking amount and cannot demand any further payment until the agreement is executed, the State Consumer Commission has held.

mumbai Updated: May 02, 2012 01:19 IST
Charul Shah

Builders must execute a flat-purchase agreement with buyers immediately after accepting the booking amount and cannot demand any further payment until the agreement is executed, the State Consumer Commission has held.

The Commission was hearing the appeal filed by a Pune-based builder M/s Universal Developers against an order passed by the district forum, Pune.

The complainant Mangal Pandey had booked a flat in the builder's project in September 2007 after paying Rs 1,000 as booking amount. Till 2010, Pandey had paid a total of Rs1.50 lakh as the booking amount. He hence asked the builder to execute the agreement of sale in his favour. Pandey contended that after getting the agreement for sale, he could have procured a loan from a bank and could have paid the remaining installments. However, the builder ignored his request. An aggrieved Pandey approached the court.

The forum directed the builder to execute the agreement in Pandey's favour and also asked him to pay compensate the complaint.

The builder challenged the order before the State Consumer Commission, which dismissed the appeal. The Commission observed that as Pandey had already paid an amount of Rs 1.50 lakh towards part-consideration of the flat, the forum's directive was perfectly correct and sustainable in law.

The commission further observed: “It is also a statutory duty on the part of the Builder to execute an agreement for sale under the Maharashtra Ownership Flats Act, 1963, before the builder accepts any amount other than booking amount. The builder is trying to stall the complainant from procuring a home loan by not executing an agreement for sale in favour of the complainant despite the fact that the builder has already accepted from the complainant an amount of Rs 1.50 lakh towards booking of the flat.”