Both real estate promoters and buyers have the right to terminate a deal in case of default by either side of the parties, according to a newly notified Agreement for Sale rules.
The rules specify that if the promoter fails to give ready to move in possession of an apartment or fails to complete the project as per the stipulated time, the buyer can terminate the agreement and is entitled to refund of amount paid with interest in 45 days of such termination, according to an official release.
On the other hand, if the buyer defaults on payments, then the promoter has the right to terminate the agreement and cancel the allotment made to the buyer while keeping the booking amount and interest liabilities.
However, if the buyer does not want to terminate the deal, the promoter will then have to pay him or her interest till the project is completed.
The Real Estate (Regulation & Development) Agreement for Sale Rules 2016, notified by Ministry of Housing and Urban Poverty Alleviation, are applicable to the UTs of Andaman and Nicobar Islands, Dadra and Nagar Haveli, Daman and Diu, Lakshadweep and Chandigarh.
Under these rules, a 20-page agreement has been specified in which the date of delivery of possession to buyer is to be clearly mentioned and a schedule of payment as agreed upon by both parties is to be enclosed.
“Violation of these commitments is to be treated as default, in which case, promoter and buyer can terminate the agreement,” the release said.
The Agreement to be entered into stipulates that the total price of an apartment or plot shall be escalation free except when development charges are increased by the competent authorities.
Apart from other provisions, the agreement also provides certain rights to promoters including timely payments as per the mutually agreed upon payment schedule, interest in case of delay in payments by buyer, and additional payments for increase in carpet area.
The rights of buyers include timely delivery of possession of property, refund or payment of compensation with interest in case of delays and rectification of structural defects by promoter over a period of five years from the date of issuance of occupancy certificate, the release said.