3 hrs ago
Bombay High Court Upholds Developer’s Cancellation of Homebuyer Allotment
The case was about a buyer who was supposed to complete paperwork for a home.
He put money into a bank account intended for stamp duty and registration fees.
However, the money never reached the government offices that collect those fees.
The Bombay High Court said keeping money ready is not the same as actually paying it.
The developer had asked the buyer several times to finish the agreement.
Because the agreement was not completed, the developer cancelled the allotment.
Earlier housing authorities had ordered the developer to sign the agreement.
The High Court overturned those orders and supported the cancellation.
It still ordered the developer to return the money the buyer had already paid, with interest.
The Bombay High Court held that transferring money to a bank account does not itself constitute payment of stamp duty and registration charges.
Homebuyer Santosh Sandhu transferred Rs 4.65 lakh, but the amount never reached the relevant stamp or registration authorities.
The dispute involved an alternative flat after the developer’s Airoli project was reduced from 30 floors to 19 floors.
The court ruled that Sandhu was responsible for failing to execute the agreement and upheld the July 30, 2019 allotment termination.
The developer must refund Rs 12.30 lakh with interest at SBI MCLR plus 2% annually, without deducting earnest money.
- Who
- JP Builders and Developers and homebuyer Santosh Sandhu were involved; Justice Sandeep Marne delivered the ruling.
- What
- The Bombay High Court upheld termination of Sandhu’s flat allotment because stamp duty and registration charges had not actually been paid.
- Where
- The dispute concerned a project in Airoli, Navi Mumbai, and was decided by the Bombay High Court.
- When
- The allotment was terminated on July 30, 2019, and the ruling was reported on September 25, 2026.
- Why
- The court found that Rs 4.65 lakh remained with Punjab National Bank rather than reaching the concerned statutory authorities.
Homebuyer’s Position
Developer and High Court’s Position
Whether payment was made
Homebuyer’s Position
Santosh Sandhu claimed he had paid Rs 4.65 lakh toward stamp duty and registration charges and sought completion of the agreement.
Developer and High Court’s Position
The developer and High Court said the money was only transferred to a bank account and never reached the statutory authorities, so payment had not occurred.
Responsibility for incomplete agreement
Homebuyer’s Position
Sandhu asked for additional time to arrange the charges or for the developer to pay them initially and recover them through his proposed home loan.
Developer and High Court’s Position
The High Court held that Sandhu was responsible for the agreement not being executed and that the developer was not required to wait indefinitely.
Whether the allotment should continue
Homebuyer’s Position
MahaRERA and MahaREAT had directed the developer to execute a registered agreement for sale.
Developer and High Court’s Position
The Bombay High Court set aside those directions and upheld the developer’s cancellation of the allotment.
Key facts
- Court
- Bombay High Court
- Judge
- Justice Sandeep Marne
- Homebuyer
- Santosh Sandhu
- Unpaid statutory charges
- Rs 4.65 lakh
- Refund ordered
- Rs 12.30 lakh
- Interest
- SBI MCLR plus 2% annually from July 12, 2016 until repayment
- Allotment termination
- July 30, 2019
Quotes
Justice Sandeep Marne
Bombay High Court judge who delivered the ruling
“Merely making provision for stamp duty and registration charges and transfer of the amount to the banker does not mean that stamp duty and registration charges were actually paid by the allottee.”
freepressjournal.in
“The allottee himself is responsible for non-execution of the Agreement for Sale.”
freepressjournal.in
Sources
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