Wonderous - I recently agreed to purchase a flat in Delhi
5 months ago
I recently agreed to purchase a flat in Delhi. Initially, towards this, an agreement was made with some advance amount paid. Then before the registry date, I paid the rest of the balance amount but on the date of registry due to some unforeseen circumstances at sub-registrar's office the sale deed was not registered as we came to know that the registration process has been stalled due to some Supreme Court order. It is to be noted here that the deed papers had been signed by me and the seller both. But as the deed was not registered that day, the seller kept the deed with himself and I was only allowed to take photos of the deed papers. Now just two days before we came to know that there is a severe problem of water supply in the flat and also there were some other problems. And there are no easy solutions to these problems. So we informed the seller about it and told him that we were not interested in buying this property anymore. He then offered to sell us another flat at a new deal. So my questions are (1)can we legally buy this new flat instead of the previous one at this stage? (2) How should the previous deed be superseded/canceled? (3) What are the legal complications that may arise due to this? (4) The seller told us that 15% charge of the earlier stamp duty paid would be deducted then a new stamp duty amount would be charged. What is the rule position on this? (5) The seller also made us believe that paying house tax in Delhi amounts to the mutation of the property in the buyer's name. No separate procedure is required. Is this correct or not?
If both parties agree to cancel the previous deal and enter into a new agreement for a different flat, it is possible. Since the previous deed was not registered, it is not legally binding and does not transfer ownership of the property to you. Therefore, there is no need to formally supersede or cancel the previous deed. Paying house tax in Delhi does not amount to the mutation of the property in the buyer's name. Mutation is a separate process that involves updating the property records in the name of the new owner. Mutation is mandatory for the buyer to gain complete ownership rights and avail of benefits like property tax exemption.
As regards your Q-1) can we legally buy this new flat instead of the previous one at this stage? Reply - you can buy the new flat instead of the old one if the status of the title/ownership and encumbrance of the new flat is found satisfactory after court searching done from authentic sources., Q-2) How should the previous deed be superseded/canceled? Reply - Following the terms of the cancellation clause of the previous deed, the same needs to be cancelled by executing a deed of cancellation between the parties, Q-3) What are the legal complications that may arise due to this? Reply - If the understanding between the parties, the new property papers is okay and the terms of the fresh agreement are fair and reasonable, then there are no legal complications or consequences apparently appear as of now, however, if the property is being bought through Bank loan, then borrower/buyer should inform the Bank and obtain their NOC before entering into the new deal, otherwise borrower may face legal consequences. Q-4) The seller told us that 15% charge of the earlier stamp duty paid would be deducted then a new stamp duty amount would be charged. What is the rule position on this? Reply - The stamp duty and registration fees are not refunded once paid for the registration of the agreement/deeds. But in a few States, if a sale deed is cancelled, property buyers can seek a refund of up to 98% of the paid stamp duty by submitting a refund application along with the original agreement and the original cancellation deed within six months from the date of execution of the documents. You may enquire about the matter from the concerned Registration office of your State/District to verify the authenticity of the information shared by the Seller about the deduction of stamp duty on cancellation of an earlier sale deed which is neither executed nor registered yet. Q-5) The seller also made us believe that paying house tax in Delhi amounts to the mutation of the property in the buyer's name. No separate procedure is required. Is this correct or not? Reply: - The information shared by the Seller is totally misleading and far away from the truth. Mutation of property in the name of the Buyer in the records of different authorities, e.g, Municipal Corporation, Land Revenue Deptt, Electricity, Water Deptt etc. requires compliance with the standing procedures and formalities post-purchase of property through a registered sale deed. You need to visit the office of the concerned authorities to collect authentic information with regard to mutation.
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