bhabhu (lecturer) 31 May 2012

Buying a lease titled property through gpa

Hi Everybody,

I need a suggestion for the following situation.

Mr. X purchasing a site from Mr.A to whome the site was allotted through *** employees association. but in the sale deed to the original alottee [Mr.A] tells that, till the end of 10 years from the date of registration, the original alottee (Mr.A) cannot sell to others. If sold, it will be void and the society can take the site back to its custody. After the completion of 10 years, the sale deed to the original alottee will be automatically converted to clear sale deed.

1) Mr. X already executed a sale agreement from Mr.A and it is a registered agreement. Stamp duty is also paid. Now can Mr.X buy this site through registered GPA, If yes, suggest me the necessary documents required and what precaution Mr.X must take to execute registered GPA.

2) Can Mr.X avail loan facility from the bank?

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3 Replies

Adv.R.P.Chugh (Advocate/Legal Consultant (rpchughadvocatesupremecourt@hotmail.com)) 31 May 2012

Dear Querist,

1. Would seriously advise you to steer clear of such transaction. The Agreement to Sell already executed can be held to be 'discovered to be void' within the meaning of S.65/56, on the grounds of impossibility and since the allottee was aware of such legal incapacity to sell - recovering money won't be a big problem.

2. I don't think any Bank would agree to extend loan for such a transaction.

3. Try talking to society on payment of unearned increase - they may ratify such Sale. Ratify regularises the irregular.

Regards,

Advocate Bharat