How to cancel flat/apartment booking?

You have paid money to the builder/developer as booking amount, GST charges, advance consideration, legal charges (maybe), Stamp Duty Charges and more. First thing that you need to understand that there will be deduction. You will have to come to terms with the fact that you will not get the entire amount back but by some chance, if you find yourself to be a person who got his or her entire amount back without losing even a single rupee, then you should go and buy a lottery ticket right now.

If you have yet to register the sale agreement, then you stand at losing a small percentage of the booking amount only but if you have registered your document then you will have to think about all the aforementioned charges and get ready to engage in a correspondence battle with your builder/developer. Do not get all gloomy reading this thing wondering why do you have to struggle for your own money? You do get your money but it’s not a walk in the park. We do not want you to get into a depressed state going through negative scenarios in your head. You will get your money if you do it right. How much time will it take will depend upon how you act. Allow us to break it all down in further steps for you.

Talked with your family/partners and you are set to cancel. The first thing you do is to convey/communicate/tell the builder/developer that you wish to cancel your property transaction. That you do not wish to have their awesome and magical property anymore and would like to most respectfully, have your money back. Also, be certain to communicate all this in writing. If you could send a drafted letter through courier or registered ad post, nothing like it but use emails at least. (Please do not use whatsapp for this.) What we are doing is that we are creating records of correspondence that we had with the builder. So if he drags this out and delays you excessively, you will have proof in writing that you had begin talking with them 15 days or 45 days back and they are just playing around not closing your query effectively in appropriate duration.

At this point, some of you are thinking that this is way too much formality for a cancellation, the team at the builder/developer’s office are your friends, a call from you will do the deal, in fact you are confident that if you send a text message your money will be at your doorstep the next morning. Yeah? Well do it. Let us see you work your magic. Listen, we have some news for you, unless you are a millionaire hotshot whom the builder/developer can’t afford to upset or you have a real close acquaintance with them, you are going to be put on hold and will have to wait around like everyone else who have been waiting for their money. Start creating records.

Imagine ordering something online and they won’t tell you the duration within which your package would arrive. It could be 15 days or 50, how would that make you feel? Deadline is important in communication. When you communicate with the builder/developer’s team, let them know that you are looking forward to wrap the cancellation process within 30 or 60 days. Be realistic though don’t give a deadline like 24 hours or a week. And always follow up that deadline with a consequence. If they do not close the cancellation process within 60 days then you will take up the matter with RERA of your state. Let them know what’s coming If they don’t act on time and be ready to follow up on it. If you have said that you will approach RERA after 60 days then be prepared to approach RERA after 60 days. Maybe the team at builder/developer’s will talk agreeably with you, pretend to co-operate and help you and make you believe that things are in progress only to tell you that they will need some more time after the 60 day period is up. Their reason may be genuine but there is no way for you to know if it is true. So stick to your plan and take action else the people at your builder/developer’s office will stop taking you seriously, you will be reduced to just another person who talks big but doesn’t act when it matters.

At some point of your correspondence, you will be informed that an x percentage of your amount will be deducted and you will be given rest of the amount back. Let’s say they you have paid 5,00,000/- (Five lakhs), the builder says you will get only 80  percent back, that’s 4,00,000/- (Four lakhs). You will lose one lakh, now you could either accept it and bear that loss or negotiate with the builder to reduce the deduction percentage. Whatever their company policy on deduction is, you should be aware that it is not the law. You could and should fight tooth and nail for your money and bring that percentage down. RERA act says that the builder should return the amount of money paid by the purchasers but it is silent on the percentage of deduction, there is no guideline for a maximum deduction and so it is on you to figure out what you deem is an acceptable deduction percentage.

If you have registered the sale agreement then you have agreed to the developer’s terms which says that it will deduct x percentage of your total consideration. Consideration means the total price of a property. If the property in question is worth 80 lakhs, that’s a loss of 8,00,000/- for you. Do you agree with it? At this point you must be wondering that you don’t have any option other than to agree with the developer since you have signed on the agreement, you must believe that you ae bound by law. But we have already told you that RERA Act is silent on the point of deduction. You have every right to fight for a lesser percentage on deduction.

Once you have finalized the percentage of deduction with which you agree with the builder/developer, you should ask them to arrange for registration of cancellation deed as soon as possible. (If you have already registered a sale agreement). There are two clauses which must be mentioned in your cancellation deed;

1. Possession: It should be clearly mentioned that you have never received the possession of the said flat.
2. Original documents: The original documents like agreement for sale and cancellation deed shall be handed over in your possession.

These two clauses are imperative for you to be able to file a stamp duty refund application.

When will you receive payment from the builder/developer? A month after cancellation deed, two? Six months? For some reasons/s I have seen purchasers agree to builder/developer giving them payment after 3 months of cancellation deed. Let’s assume you have registered the cancellation deed in January. That day you give away your claim on that property but you do not get your money back. In month of April you call your builder/developer for payment as agreed, he then hands you five cheques. Every cheque is of a different date, every cheque is of subsequent month. One is cleared right away in April, second in May and so on. The cheque in august gets bounced. You call the builder he asks to wait for another three months. What can you do in such scenario, would you sue him for 50,000/-? How much will the lawyer charge? What was the point of your fighting with the builder to lower deduction percentage if you have to give it away to the lawyer? Either get all the money on the same day of cancellation deed or ensure that the money gets in your account by the end of three months. If you feel the need, include a clause within the cancellation deed that the amount if paid by cheque, will be dated in a manner that the said amount will be reflected in your bank account by the third month in full.

This is how you cancel a flat/apartment booking, ladies and gentlemen. If you wish to explore more information about stamp duty refund you could check out the estampdutyrefund.com. Thank you.