cancellation of land sale agreement

praveen paruchuri (Querist) 22 March 2010 This query is : Resolved
Hi,

I planned to take 240 sq yrds of land from one of the gated communitys related to a developer.The price was 5,28,000/- out of which i paid 1,50,000/- as advance.The agreement was made on nov 4th 2009.There was no time limit mentioned in the agreement when to pay the balance amt.It was mentioned like Balance to be paid once LP number is obtained for the gated community and then i should pay the rest amount by availing the bank loan for the balance amount.This is all mentioned in the agreement.We never mentioned the details like what will happen if the agreement is cancelled?The developer got the LP number in march and now he is requesting me to go for the bank loan procedures to pay the rest balance amount.
Now I want to cancel the agreement as the bank loan is around 18 percent and I dont have much cash to pay the balance.i dont want to purchase the land.Now please let me know if i cancel the agreement will i get the money back which i paid as an advance?please let me know.

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Devajyoti Barman (Expert) 02 November 2010
Yes, only if there is such provision in the sale agreement.

s.subramanian (Expert) 03 November 2010
I agree.

R.Ramachandran (Expert) 03 November 2010
As rightly advised by Mr. Devajyoti, if the agreement contains a term that in the event of cancellation of the agreement, the advance amount would be returned then you can ask for the return of the amount. On the contrary, if the agreement says that in the event of cancellation of the agreement, any % would be deducted from the advance and the balance would be paid you can demand accordingly. If, it was provided that in the event of cancellation of the agreement, the entire advance amount would be forfeited, then you will not be able to ask for the return of the advance amount.