RAVINDRA NATHA R J (MANAGER-MATERIALS SSD) 28 December 2010

Legal Opinion

I would like purchase a site in the Layout approved by Nelamangala Development Authority Town Planng, Bangalore. The owner of the land is X, the developer is Y. For purchase of a site, I have to pay 25% of sale consideration to the developer Y who will execute Advance Sale Agreement but he is not a owner of the land, then I have to apply for bank loan for balance 75% of sale consideration. Once loan is sanctioned, at the time of registration of site the owner will come. We have no contact with the owner till we register site in our name.

There is an agreement between the owner of the land "X" and the developer "Y", who has to do develop complete layout and hand it over individual site owners.

Is this legally OK ? If the developer is runaway without developing the layout, the sale consideraiton of 25% amount paid to developer, who is not a owner of land, can we have any claim with the developer Yas well as with the owner X.

Kindly clarify whether the above transation is OK.

Regards,

R.J.Ravindranatha

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3 Replies

suresh (Advocate) 28 December 2010

Dear Mr.R.J.Ravindranatha,

First we have to see the agreement between owner and developer is it registered in accordance with law.

Usually the developer and the owner will be entered joint development agreement, in the JD agreement they have ratio, accordingly the sites will be allocated between the owner and developer, we have see which you are looking is it in the share of owner or developer.

We have see the land owner have executed the registered GPA in favour of the Developer or not.

If the joint development agreement is registered in accordance with law it is legally OK, but we have see the contents of the joint development agreement as well the GPA.

If the developer runaway from the liability be on the land lord as well as developer, they cannot escape.

If you provide the documents , we can opine the same.

regards,

Suresh.N.V.

RAVINDRA NATHA R J (MANAGER-MATERIALS SSD) 28 December 2010

Dear Mr.Suresh,

Memorandum of Agreement mand and executed on 18.11.2010 between owner and developer on a stamp paper of Rs.200/- and registeredwith Notary. The developer has paid a refundable deposit of 25 lacs to the owner in consideration for development of sites.

Pls let me know your e-mai id to send you documents for your refrence.

Thanks and best regards

R.J.Ravindranatha