Recovering a Token Amount After Property Sale Cancellation
Introduction of Token Money Refund
Property dealings generally require a token amount as good faith or earnest. Now what happens when the deal gets scrapped? This case is about how the buyer faced challenges recovering his token money back and how they went about settling it lawfully.
Situation of Recovery Token Money
Problem Facing in Token Money Refund
A buyer made a token payment of 2% of the entire property value as part of the deal. But after paying that, the deal got cancelled because of some reasons that could not have been anticipated before. To regroup the token amount, the seller did not cooperate and took the stand that it was a non-refundable amount.
Main Problems
- Unclear Terms of Agreement: The sale agreement was devoid of clarity about refunds in the case of dissolution.
- Financial Loss: Losing that token amount would cost the buyer dearly.
- Legal Uncertainty: The buyer was unaware of their rights and what to do about the matter.
Evidence gathered: The buyer had preserved all the communication made with the seller; emails, messages, and a signed copy of the sale agreement were very essential to substantiate the case.
Solutions of Token Money Refund
With a set of clear plans, our legal team started action.
1. Issue a Legal Notice
The property lawyer draughted a formal legal notice to the vendor, asking for a refund of the token amount. The notice referred to the sale agreement terms, highlighted the absence of a valid “non-refundable” clause, and emphasised the buyer’s right to a refund under the Indian Contract Act, 1872. While the seller resisted initially, the notice forced the seller’s hand to the negotiation table.
2. RERA Complaint Filing
After the serving of a legal notice to the seller, who delayed the refund for further complaints made by the buyer to the Real Estate Regulatory Authority, the guidelines under RERA require a refund of the money in case of valid complaints within 45 days.
The buyer advanced:
- Copy of the sale agreement
- Communication records
- Evidence that there was an intention to complete the purchase before cancellation
RERA duly ruled in favour of the buyer: “The seller is directed to pay the token amount with applicable interest for delay.”
3. Civil Suit
No civil suit was needed as the seller followed the order of RERA and the buyer was refunded in total.
Outcome
The buyer received his token amount back in three months. RERA also ordered the seller to pay interest on the delayed refund.
This resolution not only redeemed the token amount from the buyer, but it also restored his faith in legal systems like RERA for effectively dealing with property-related disputes.
Tips on Token Money Disputes
- Understand the Agreements: Terms regarding refund and cancellation should be clear.
- Consult a Lawyer Early: Seek legal assistance as soon as a problem arises.
- Collect Proof: Keep records of all messages, agreements, and payments.
- Use Legal Platforms: Complaints in Community Court or RERA can speed things along.
Refunds of token money: Depending on the sale agreement, a refund may be given. Without a clear “non-refundable” clause, buyers can often claim a refund.
RERA Protections: RERA resolves the real estate disputes and ensures fairness in their dealings.
Document Everything: Keeping all communications and agreements can make or break a case.
Conclusion
Recovery of token money after a cancelled sale is usually a long procedure but early resort to legal action along with good evidence often leads to success in such cases. Legal protections under the Indian Contract Act and RERA enable customers to stand up for their rights.
If you are in a similar situation, contact Zolvit for expert legal help.