How to escape from Lodha's "Sales Trap" without losing money

18th June, 2019, Mumbai: Many flat-buyers of Lodha Group's various projects -- especially Palava City, New Cuffe Parade and World Towers -- want a refund. They want to cancel their deal, and get their money back with interest. The usual reasons are: (1) build quality issues (2) delayed possession (3) carpet area deficiency (4) unfair trade practices (5) unauthorized or improperly authorized construction (6) mis-selling and false promises.

But getting money back from Lodha is difficult. The terms and conditions mentioned in the application form, allotment letter and agreement form make it clear that Lodha will retain 10% of the consideration amount, and make a lot of other deductions too.

So, how to get back your refund without losing a lot of money?


Well, friends, here is something you can try. There is a big loophole in Lodha's agreement format for various projects. It is a clause designed by Lodha's lawyers to trap customers, but this same clause can be used by you to escape -- to legally compel Lodha to cancel the deal and refund your amount. Trapping Lodha in the same web of words that they laid for you -- this is poetic justice!

The Loophole

Use clause no. 3 -- called "Disclosures and Title" -- in Lodha's agreement signed by you, or in the MahaRERA agreement format of your project.


The clause shown above is designed to stop you from asking for disclosure of title documents and other crucial papers. It is designed to prevent you from using defects in Lodha's land title, or undisclosed features of the project which you may not like, to cancel your agreement in court.

But you can turn the tables! Use this clause to seek cancellation of agreement because it acknowledges the importance of three things :-

(a) entering into this agreement with full knowledge, free will and without coercion

(b) getting ample opportunity to study the documents of title, larger project, etc.

(c) obtaining suitable advice (i.e. professional advice) prior to entering into the agreement.


Although they acknowledge the importance of all this in the agreement format, it is a well-known fact that all these are secret documents. You never get a chance to see these documents, much less study them and seek professional advice based on them. You enter into the agreement without full knowledge and free will. You are coerced. You are blindfolded.

By proving that documents were not shown to you, you have readymade grounds to get your agreement annulled due to non-performance of essential obligations!

How to prove that Lodha is not showing you these documents? It is simple; put the burden of proof on Lodha!

HOW TO PROVE? DETAILED INSTRUCTIONS:

A. If you have signed agreement with Lodha...

Send one email every week, and finally, a legal notice after four emails, stating that you were not given any opportunity to see documents as per Clause no. 3, and therefore the terms of the agreement are not fulfilled. Invoke clause 3 to state that you were coerced, and you did not sign with full knowledge and free will.

Scenario no. 1: Lodha does not show documents. If Lodha remains silent and does not respond to your emails and legal notice, then it amounts to admission of guilt. Whereas if Lodha writes back arguing that you have inspected the documents, then your lawyer should ask for strict proof of the same. Ask them to show you your signatures on acknowledgement or receipt of the documents. Failure to show proof will amount to non-fulfillment of clause 3.

Such a correspondence can become the basis for going to court. You can file an affidavit stating that you were not allowed to inspect the said documents before entering into the agreement, and seek annulment of agreement on the grounds of non-fulfillment of essential elements of your contract.

If many flat-buyers come together to send such letters, legal notice, etc., then it will work even better because their sheer numbers will make it difficult for Lodha to deny that he did not show the documents.

Scenario no. 2: Suppose Lodha gives you such documents. Then, based on your study of such documents and/or professional advice, you may choose to exit the agreement and exit the project. You are now entitled to a full refund of your booking amount, because if Lodha refuses to give you full refund, it will amount to coercion and arm-twisting in the eyes of law.

B. If you have NOT signed agreement with Lodha...

Then write a demand for all the documents. Repeatedly write emails to Lodha, asking for inspection and copies of all land title documents, building permissions, litigations, etc. as per this clause in the draft agreement, as you will soon be required to sign this agreement. Refusal to comply becomes your basis for terminating your booking and demanding complete refund. On the other hand, providing you the documents will enable you to study such documents and/or seek professional advice, after which you may choose to sign the agreement, or alternatively, you may choose to exit. If you choose to exit, demand a full refund of booking amount.

Yes, it is possible that you may have to go to court for enforcement of your right to get refund. But the important thing is you will have a very strong case, based on Lodha's acknowledged position in his agreement format!

ISSUED IN PUBLIC INTEREST BY
Krishnaraj Rao
9821588114 and 8169471229
krish.kkphoto@gmail.com

Comments

  1. Hello sir, thanks for your post and video, I am also facing similar kind of issues. I have booked the flat in Ecovista project Shilphata by Bharat builders, the project is delayed by 2 years already and still no possession. Builder is not replying to my mail, could you please help me. Thanks

    ReplyDelete
  2. Very informative, Mr. Rao. You will help very many people who are in Lodha clutches

    ReplyDelete

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