Cancellation of allotment in RERA

Cancellation of allotment in RERA
  • General
  • Wednesday 25th September 2019
  • Author: Shreya Uppal

Highlights

  • It may not always the promoter who can cancel the allotment, the option can be exercised by the homebuyer also.

  • The reasons for such withdrawal from the project by the homebuyer can be like any default committed by the promoter, or due to tight market conditions, some personal or financial emergency could hit the homebuyer too.

  • As per Section 11(5) of the RERA Act, 2016, the promoter may cancel the allotment only as per the terms stipulated in the agreement for sale

As per Section 11(5) of the RERA Act, 2016, the promoter may cancel the allotment only as per the terms stipulated in the agreement for sale. The allottee can approach the RERA Authority for relief if he feels aggrieved by such cancellation and the cancellation has not been done in accordance with the terms of agreement for sale and without any sufficient cause.

General points regarding Cancellation
1. It may not always the promoter who can cancel the allotment, the option can be exercised by the homebuyer also.
2. The reasons for such withdrawal from the project by the homebuyer can be like any default committed by the promoter, or due to tight market conditions, some personal or financial emergency could hit the homebuyer too.
3.
If the default is on the account of the promoter and he is unable to provide the possession of the property, he must refund the required amount to the buyer along with the applicable interest.
4. The promoter is also required to make the loss good due to any defective title of the land.
5. However, the promoter is not required to make any payment of interest if the delay has been caused due to natural calamities.
6. If the required payment for a continuous period of time has not been made by the homebuyer, the promoter has every right to cancel the
agreement and revoke the allotment. 
7.
For both the parties, the rate of interest payable will be the State Bank of India’s Highest Marginal Cost of Lending Rate+2%. 

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Tags:
agreement, refundpropertypromoter

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