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Pradip S (Manager)     20 April 2011

Multiple Mortgage & Cancellation Deed


I have recently purchased a flat at mumbai directly from a builder. We have executed the sale deed and registered it with sub-registar. As per terms and conditions we have also paid 95% payment after obtaining Home Loan. We will get the possession of the new flat in the month of May,2011. Few days back we came to know that the builder had already sold this perticullar flat to another party before I purchased it and sale deed for the same was registered with sub-registar. We immidiately informed the builder and the builder has agreed to this fact. According to him the first party was able to pay the considered amount within stipulated time frame and even after repeated reminders; that is why the earler Sale deed stand cancelled as per agreed clause. As of now he has not entered into any cancellation deed with that defaulter party since he is denying to sign any document. In this scenario who is the legal owner of this perticular flat; is it me or the defaulter party? How do I close this loop legally with the builder?

Secondly how come the the Financial Institution from which I have processed my Home Loan did able to figure out this fact during title clearence process? Is there any way where we can find out deatails of Titles / sale deed for this flat?

Can we take any legal action against the builder if he is not willing provide cancellation document of defaulter party?

Pls. advice....

Warm Regards,



 2 Replies

niranjan (civil practice)     20 April 2011

Financial Institution before giving loan seek title clearance cert.and during that process search is being taken by them from registrar's office,so they can find it out. The builder should return money to first purchaser  and if purchaser do not come forward to execute cancellation deed,he will have to file suit. Wait till may 2011 for taking possession of the property.First take possession of the property otherwise  legal action may be initiated against the builder for damages and cheating etc.

Chirag Bhatt (Lawyer Gujarat High Court)     21 April 2011

As you have  legal title as a bonafide purchaser of the said property, you can file a criminal complaint against them at your earliest as delay is dangerous in criminal matter 

and you  can also file a civil suit against the builder ( proposed defendant no 1) and the person to whom the builder sold your flat after you (proposed dedendant no 2) for the cancellation of their sale deed.

as soon as you file a civil suit, lis pendens will be filed at sub registar where you registred your sale deed.

you can also be known of title and other detials of the said property by having search report of the same from sub registrar office.

you can inform the same to the financial insitutiton.

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