Agreement for sale supersedes all prior legal documents

Homeowners claimed that the developer while executing the registered agreements for sale, changed the clause unilaterally and shifted the burden of payment upon them

Ateeq ShaikhUpdated: Sunday, October 09, 2022, 08:50 PM IST
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Mumbai: Never blindly sign an agreement for sale shared by the developer in a hurry. Go through the fine print and refer it with a legal expert, it is what a couple of homebuyers at Ten BKC in Bandra East learnt after the Maharashtra Real Estate Regulation Authority (MahaRERA) ruled in favour of Radius Estates and Developers.

While marketing a project, as part of offers to lure in potential buyers, a developer may promise waiver in stamp duty, registration or Goods & Services Tax, among others.

But it is also likely that they might withdraw their onus from their promises made by discreetly mentioning in the sale agreement that the buyer is responsible to bear the cost of these charges. Thereafter, even moving to MahaRERA won’t be of help.

Amit Saxena and Milee Shetty, two apartment purchasers of Ten BKC underwent this situation and did not get any relief from MahaRERA.

They had booked their flats in 2016 and 2019 for around Rs 3.81 crore and Rs 5.50 crore, respectively. The amount was inclusive of stamp duty and registration charges, as categorically mentioned in the allotment letters issued by the developer, who is caught up in an insolvency case.

After having paid the statutory charges from their own pocket, they unsuccessfully approached the developer for a refund. Thereby, they had to move MahaRERA.

At MahaRERA, the builder denied the contention by referring to an executed sale agreement, wherein it was stated that the onus to bear the cost of stamp duty and registration on them but the purchaser. It also stated that the two buyers were also part of a litigation being heard in National Company Law Tribunal as part of the homebuyers group for certain reliefs.

The homeowners claimed that the developers while executing the registered agreements for sale had changed the clause unilaterally and shifted the payment burden upon them and due to paucity of time, they signed the agreement without going into details of every clause.

MahaRERA Member Mahesh Pathak observed that “MahaRERA is not inclined to grant any relief in favour of these complaints who have made this claim…Needless to state that the agreements for sale signed by both the parties supersede all earlier contracts made between the parties.”

Therefore, the homebuyers' demand for stamp duty and registration refund do not stand, despite it having a mention in the allotment letter.

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