Property sale - non performance - return of cheque
TM PREMKUMAR
(Querist) 10 September 2012
This query is : Resolved
Respected Sir,
I had proposed sale of my residential property, for which I had taken an Earnest Money deposit in Jan 2012. An agreement to sell was executed fixing May 2012 to register a Sale deed. On no action, two letters were sent during May & June 2012. No replies were received. In July 2012 end, an undated cheque for the balance value was issued, suggesting date could be entered once cash was mobilized in full. Again there was delay. When I went personally to the purchaser,he asked me to date the cheque on 24.08.2012. On presentation, on 27.08.2012, the cheque bounced for want of funds.I issued notice to the purchaser, and gave him time till 12.09.2012. Can you please counsel me what further action should I take, regarding return of cheque, cancellation of the agreement to sell AND forfeiture of Earnest Money Deposit?
Thanking you,
Yours most respectfully,
[TM PREMKUMAR]
ajay sethi
(Expert) 10 September 2012
it is necessary to go through the clauses of agreement to advise . does agreement contain clause that in the event balance payment not received depsoit would be for forfeited . since cheque has been returned unpaid purchaser has failed to make payment in time . you cn aissue legal notice under section 139 Ni if you so desire .
in alternative you cna mutaully settle the matter .
contact a local alwyer .
TM PREMKUMAR
(Querist) 11 September 2012
Thank you, Sir. While receiving the Earnest Money deposit, it has been mentioned that time is the essence of the contract.
Yogesh Anand
(Expert) 11 September 2012
You better don't go for 138 complaint because if the purchaser pays the cheque amount then delay will be deemed to be condoned and he will get the property. You better forfeit the earnest money as per the terms of the agreement which states time to be of essence of the contract. Delay in payment and dishonour of cheque are sufficient grounds to rescind the contract. Let him fight for his case if he so desires, you will win.
Dr J C Vashista
(Expert) 13 September 2012
Is there any forfieture clause in your agreement, if yes forfiet, you are well within yor right.
Somehow, dictate your terms, if you still feel to favour purchaser.
However, donot go for filing case u/s 138 NI Act against bounced cheque.
