Legal Question in Real Estate Law in India

owner have entered in development agreement with builder and also power of attorney is executed and both are registerd and agreemnet clearly state that it is properiotorship concern . but the developer expired but before expiry the proprioptership was converted in to partnership by the builder without the consent of the owner and neither the owner was informed but the same partnership firm entered in to development agreement with new builder of which owner is not aware .therefore payemt is pending of the owner which is supposed to be paid by developer to the owner for which owner send notice of payment to the developer,and the received reply stating that the developer has expired.

Note : physical poseession of the plot was never handed over to the deceased developer.

Therefore please guide what legal remedy is available with the owner as followsfor the question as follows.

1) can owner canel the development agreement executed with the decessed developer? if yes what is the procedure ?

2) can owner cancel the power of attorney ?

3)what is the status of the registed power of attorney whether it is cancelled on death of the attorey holder or not?

4) And how to cancel the Power of Attorney ?

4) can the new developer enforce the development right on the property of the owner?

5)Can new developer take the posession of the propety without owners consent.


Asked on 7/20/13, 9:02 am

1 Answer from Attorneys
Fca Prashant Chavan Expert Edge LLP

20.07.2013

Dear Sir / Madam,

Since the Owner of the plot of land has already executed and registered the Development Agreement (DA) in favour of the Developer, even if the nature of the business entity has changed from sole proprietory concern to a partnership firm, and the sole proprietor is deceased, the changed business entity cannot absolve itself of its legal liability to pay the agreed consideration to the Owner for parting with the Development rights and settling the Owner. The business entity has erred in their reply to the Owner's notice, that they cannot pay the agreed consideration since the Developer is no more.

1. Yes, Owner can cancel the DA, by writing a letter to the Registrar of Stamps and the Sub-Registrar of Properties invalidating the DA.

2. Yes, the Power of Attorney given by the Owner is in any way rendered null and void since the person in whose name it was originally given is no more.

3. Same as in point (2) above.

4. Same as in point (2) above.

5. Given an ultimatum to pay the purchase consideration within a stipulated period of say 7 days, the Developer cannot enforce the DA if he fails to complete payment settlement by the date for settlement given by the Owner.

6. Since the Owner has not yet parted with the possession of the plot, the new developer cannot take possession of the property without complying with the condition specified in point (5) above.

Regards,

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Answered on 7/20/13, 10:05 am


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