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sonia (housewife)     05 January 2014

Agreement of sale query

Hi,

My NRI brother signed an agreement of sale with a guy from Kolkata and made my mother the witness. This was done on Rs 20 stamp paper and in our house on 16th April 2013 but was not registered. The guy could not get the money ready and my brother had arrived for a week in July just for the sale. So my brother sold the flat to another buyer who had ready money, after the expiry of 3 months. Now the first buyer is sending lawyers letters to my mother asking my brother to return the deposit of Rs 1 lakh.

Q1) Can the guy do anything to harm my mother? His lawyer has threatened my mother with police arrest, fraud and criminal case.

Q2) We were told that the guy can bring a case for upto 3 years. In that case when does his 3 years expire? Is it 16th April 2016?

Please advise, my mother has become ill with stress.

Thanks

Sonia



Learning

 14 Replies

BHARTI KOTHARI (practising advocate)     05 January 2014

HEllo,

You have not disclosed the exact content of agreement. but any way as you told that it is on RS.20 stamp paper no need for bother and after all it is earnest money.

he can not troubled your mother.

he can file civil suit for recovery of money till 16.04.2016 but I dont think he will sucessess.

Regards,

Adv. Bharat Kpothari.

1 Like

Dr J C Vashista (Advocate)     05 January 2014

Incomplete informations and vague querry

adv.raghavan (Advocate,9444674980)     05 January 2014

i accept with the above experts with regards to query details, but given the situation, you are suppose to refund him back his advance money after completion of 3 months with due advocate notice, prior to that and along with that you should have entered cancellation of agreement also, which u have failed to do so.

whether the matter attracts criminality or not  according to me is yes, but still the court will take a  final call, 

he do have the option to go for a civil suit with regards to money recovery , so it is advisable to call the person and settle his money back and carry on your life.

1 Like

sonia (housewife)     05 January 2014

Thank you all for your responses. My worry is about my mother who was a witness to the agreement of sale for my brother. She is the one getting letters from the buyer’s advocate and has been threatened with arrest and criminal case.

My primary query is, can there be any case, civil or criminal, against my mother at all?She was just a witness in an unregistered sale of agreement.

My mother has spoken to two local lawyers and has got conflicting advice which has confused her. We are all worried about her health.

Thanks

T. Kalaiselvan, Advocate (Advocate)     05 January 2014

Now the agreement for sale is just a receipt for the money you had taken from him.  Your mother has witnessed the deed.  Your mother cannot  be impleaded as a party but she can be summoned by the court for  deposing her evidence with regard to her witnessing the deed. There is no reason or cause of action for criminal case, however it is your  moral duty to refund the advance taken, without interest.

1 Like

Dr J C Vashista (Advocate)     06 January 2014

Nothing more to add

SKapoor_Lawkonect (Lawyer)     06 January 2014

Hi Sonia, though you have clarified the contents of the agreement to sale signed by your brother with the buyer but the SC with regard to unregistered agreements to sell has in the case of Suraj Lamp & Industries Pvt. Ltd. Vs. State of Haryana & Anr., has said that “Any contract of sale (agreement to sell) which is not a registered deed of conveyance (deed of sale) would fall short of the requirements of sections 54 and 55 of The Transfer of Property Act, 1882 (“the TP Act”) and will not confer any title nor transfer any interest in an immovable property (except to the limited right granted under section 53A of the TP Act) for defending possession. According to the TP Act, an Agreement of Sale, whether with possession or without possession, is not a conveyance. Section 54 of TP Act states that sale of immoveable property can be made only by a registered instrument and an agreement of sale is not a document of transfer and does not create any interest or charge on its subject matter.” Hence, in your case the buyer can only file a suit against your mother for refund of earnest money and no case of fraud or criminal case can be filed as no right in the property has arisen in the other person by way of an agreement to sell.

Regards,

SKapoor

LawKonect

 

9555507507

1 Like

sonia (housewife)     06 January 2014

Thank you Mr S Kapoor for your detailed response. It is s relief to know that there can be no criminal case against my mother.

My question still remains how can the buyer file a suit against my mother, who was just a witness?

She did not receive any money so how can she be asked to repay it?

Thanks in advance

T. Kalaiselvan, Advocate (Advocate)     06 January 2014

The buyer cannot file a suit against your mother, if need be he can send witness summons to her for deposition of evidence as she has witnessed the document.  Since your mother is not a direct party a suit against her will be maintainable.

sonia (housewife)     08 January 2014

Thank you Mr Kalaiselvan for your assuring reply.

Sonia

Purushottam Dayama (member CHS)     10 February 2014

What happens if a cheque issued in favour of person with whom binding/pre-sale agreement is made, is not cashed by seller for 90 days because he finds that price of land property is much higher than the quoted by the buyer.After 90 days bank issued certificate that cheque is invalid and has to be revalidated. Meanwhile the buyer goes to other six coparceners and shows them photocopy of the cheque and makes pre-sale/binding/Isarakhat agreement for signing the registered deed of sale. 

  Evenafter 90 days Karta in whose favor cheque was issued does not sign any agreement but buyer calls individual coparcener to visit sub-registrar and sign agreement for sale of the undivided share of property without information or NOC of Karta. 

   Will such sale be valid and buyer gets part possession of the land? Karta is agreeing to buy the undivided shares of all other coparceners. All other coparceners have taken money except Karta.

  What are the options available to Karta?

Purushottam Dayama (member CHS)     10 February 2014

The post repeated 3 times as the server was unresponsive

Dr J C Vashista (Advocate)     10 February 2014

1. If a cheque issued in favour of person with whom binding/pre-sale agreement is made, is not cashed by seller the vendor is liable for specific performance, irrespective of the fact that the property rates have sky-rocketted.

2. Yes, such sale be valid and buyer gets title and possession of the land. the vendor (Karta) is bound to execute sale documents and hand over possession to vendee. The Vendee must issue legal notice to Vendor (Karta) who have made an agreement to sell on behalf of HUF. (all coparceners).

3. If the karta takes extra money from other coparceners, it is personal decision, will have to face the consequencies.

Purushottam Dayama (member CHS)     11 February 2014

Karta has not signed any agreement at sub-registrar office and only before Notary(That too being cheated). How can a person who has not recieved money in his account can be liable for the same. How can a person who is not showing bank statement of debited money but only photocopy of cheque claim to have paid amount and insist on performance of contract?  Again what happens if he does not take any steps to ensure performance of contract  which he knows that non existing?  It can be proved that vendee has signed other coparceners by deceit by showing cheque photocopy and other coparceners trusted that due to their trust in Karta. 

    There is a transfer of property law discussed on this forum which states that any coparcener has "first right of refusal" for the sale of undivided share of joint property and no outside person can purchase undivided share in joint property and get possession and other enjoyments.

  The vendee is not contacting Karta and enforcing sale but bypassing Karta and luring other coparceners to take money as their share which they can;t do as per law or without NOC of Karta. As per law coparceners either agree to sell the property or sell their share to one of the parceneres at agreeable price or make a suit for partition of property. (Yet this being small land property can not be divided)

   Suppose A shows B a cheque of agreed amount and asks to sign on agreement papers and then does not give physical possession of cheque and destroys the same. Later by showing the photocopy of the cheque he can claim huge amount given to B and ask for perfomance of the signed contract?


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