Developer is Owner's attorney

Querist : Anonymous (Querist) 10 December 2010 This query is : Resolved
Will the Hnb'le Experts throw light to the following?

1) There are 14 share holders of 30 Cuttah land at Kolkata. They are all own brothers or cousins.
2) They have appointed one Mr Roy & another Mrs Roy wife of Mr.Roy as their constituted attorney for signing any paper, plan, selling flats etc. after construction of a Flats on their land.
3) The said 14 land owners have also entered into a Development agreement with one Ratna Construction & the aforesaid Mr. & Mrs. Roy are the only two partners of it.
4) The said Ratna Construction has applied for loan from Bank as Developer & also offered to sale the flats to be constructed on the site to the public.
5) Understand from the Bank that they are hesitating to sanction loan for this type of arrangement where the owne's attornies are also the sole partners of the Developers.

My question is

a) Is the above arrangement legally valid?
b) Will the Bank grant loan to the Developer for construction of flats under such arrangement
c)Shall I book one flat under such arrangement by paying the booking amount?

Respected Experts' early reply is requested.

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A V Vishal (Expert) 10 December 2010
a) Is the above arrangement legally valid?

Ans. Yes

b) Will the Bank grant loan to the Developer for construction of flats under such arrangement

Ans. It will

c)Shall I book one flat under such arrangement by paying the booking amount?

Ans. It your choice.

However, First get a legal opinion from a local advocate with all the link docs you hold and only after that enter into a contract/agreement.

s.subramanian (Expert) 10 December 2010
I agree.

Devajyoti Barman (Expert) 10 December 2010
1.Yes. the co sharers have the dual capacity of partners of the developer's firm as well.
2. Yes, the bank should not reject any appliicaton for loan though it is the absolute dscretion of the bank itself and you can not force it if it refuses to do so.
3. Yes but before that it is advisable to take help of an advocate so that he not only rummage throuh the relevant documents but check the antecedant of the title of the property as well.

Kirti Kar Tripathi (Expert) 10 December 2010
i agree.

Advocate. Arunagiri (Expert) 10 December 2010
I agree with Mr.Barman and Vishal.
Project wise it is okay, as per the documents, you have to get the legal opinion.

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