Legal Question in Real Estate Law in India

If one has recenly agreed into an agreement of sale to purchase a flat in bangalore and Builder asks to register the flat at an amount almost one-third of the actual Sale Consideration. The Sale Agreement in place clearly states the actual Sale Consideration and has been used to apply for a Bank Loan as well. I can understand that on the positive side registering the property at lower value will result in saving of Stamp Duty and Registration Fees and on the negative side the buyer may have to pay high capital gains tax in the case of a resale - but need to understand what other negative implications it will have. The transactions will be made in checks so would that still mean that the white money of buyer is getting converted to black money. What should one do?


Asked on 11/21/10, 4:37 pm

1 Answer from Attorneys
RAJIV GUPTA (Cell: +91 9811284735) [email protected]

this would be considered a wrong practise and in case the registeration is being done for one third of consideration amount, the value of property in re sale would be affected and you would be liable to pay high capital gain in case you sell it off.

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Answered on 11/21/10, 10:18 pm


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