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Samik Bhattacharya
Asked July 29, 2016

return of advance

  • 2 Answers

We have paid Rs 10,000 as a token advance to a landlord whose property we were supposed to rent.But due to personal reasons we can't shift to that house and have informed the landlord but now he is refusing to pay back the amount. There has been no rental agreement signed yet. He is avoiding our calls and told us blatantly that he would not return the money. We saw the house through a real estate agent. And he had given us a receipt on paying the token amount. The receipt doesn't mention "non refundable" amount anywhere.Can I take any legal step to get my money back?

Answers 2

You can send a legal notice[1] to the landlord. This would serve the purpose of indicating that you are willing to take legal action against the landlord if your demand for return of your money is not fulfilled. In order to prevent further legal complexities, the landlord would mostly return your money after such notice.

If the landlord however, still does not return your money, you can file a recovery suit against the landlord, because as you are not availing any service in return of the money transferred. Recovery suits usually are long term proceedings and hence in order to avoid such delay you may file a summary suit under Order XXXVII of the Code of Civil Procedure, 1908[2], which allows for speedy recovery of money.

However, since it was you who caused the breach of contract, you would not be entitled to any compensation. You would probably receive your money back due to the absence of any contract in contrary.



[1] Format available at:

[2] Available at:

Agree Comment 0 Agrees over 4 years ago

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Rahul Singh

The new Real Estate Act of 2016 has laid down very strict rules regarding delivery of possession of flats on time. Earlier it was a trend among most builders not to give possession of house to the buyer on time. But according to the new rules even if the possession is delayed for a day the buyer can claim for damages. In your case you are paying the monthly EMIs of your home loan as well as the house rent so you can send a legal notice claiming for the money that you are spending on the house rent because had the delivery been made on time you would not have to pay these monthly rents. You are clearly bearing this extra expenditure due to your builder’s default in delivery of possession of your house on time so he must compensate the rents until he is delivering the house.

The builder is required to inform the buyer about the date of delivery and if he is not assuring any concrete time for the delivery of the flat you can send a Legal Notice through your lawyer to the builder. If still the possession is not granted, then file a case in the Consumer Forum for recovery of money and compensation for the ensuing delay. You are not only entitled to the amount of 6.5 lakh that you paid but also to some interest on that amount. The interest ranges normally between 9 to 18 % which is the discretion of the consumer court.

Recently the National Consumer Commission has ordered that officials of real estate firms can be arrested if they fail to handover the flats or make refund in stipulated time. So stop giving your builder a long rope otherwise he will not deliver the possession for years.

Agree Comment 0 Agrees over 4 years ago

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