DLF's one sided and exploitative buyer's agreement(ABA)

I have always heard people saying general public is helpless and administration help and support only criminals, etc. But never thought I would be the victim of this, before I fell in trap of DLF.

My story of buying flat and regretting it big time.

What is ABA: When you buy a flat with builder, builder will compile and send a ABA(Apartment Buyer's Agreement), you will not be consulted and nothing can be changed if you object. You either agree to their terms and condition and sign the agreement or there is no deal.

DLF buyer's agreement is one sided in favor of DLF and very exploitative for owners. Recently CCI also found out this. Although almost all the clauses of agreement are one sided I am listing few problems which owners of DLF Maiden Heights are facing and how DLF is using ABA against owners.

• DLF promised to deliver flats within 30 moths from date of booking, if they wouldn't deliver they will pay Rs. 5/- per square feet per month as compensation after 30 months. They refused to pay compensation pointing to below clause. So if owner miss any date even by 1 hour(one owner actually missed by 5 hours), DLF will charge hefty interest on the money also owner will not be given any late delivery compensation. So DLF can take 10-20 years to finish the flats without any consequences. 

• "Failure to deliver possession by the Company: If for any reasons other than those stated above, the Company is unable to deliver possession of the Said Apartment to the Allottee within thirty months(30) from the date of the Application or within any extended period or periods as envisaged under this Agreement then in such case, the Allottee shall be entitled to give notice to the Company, within ninety (90) days from the expiry of the said period or such extended periods, as the case may be, for terminating this Agreement. In that event the Company shall be at liberty to sell and/or dispose of the Said Apartment and Parking Space to any other par ty at such price and upon such terms and conditions as the Company may deem fit without accounting for the sale proceeds thereof to the Allottee. Thereafter the Company shall within ninety (90) days from the date of full realisation of the sale price after sale of Said Apartment alongwiththe Parking Space, refund to the Allottee, without any interest, the balance from the amounts paid by the Allottee in respect of the Said Apartment and the Parking Space without deduction of Earnest Money but after deduction of Non-Refundable Amounts. The Allottee agrees that the Allottee shall have no other claim against the Company in respect of the Said Apartment and Parking Space under this Agreement. If the Allottee fails to exercise the right of termination within the time limit as aforestated, by delivery to the Company of a written notice acknowledged by the Company in this regard then the Allottee shall not be entitled to terminate this Agreement thereafter and shall continue to be bound by the provisions of th is Agreement. However, the Company may, at its sole option and discretion, decide not to terminate this Agreement in which event the Company agrees to pay only to the first named Allottee and not to any one else, subject to the Allottee not being in default under any term of this Agreement, compensation @ Rs. 54/-per sq. mtr.(Rs.5/- per sq. ft. approx) of the Super Area of the Said Apartment per month for the period of such delay beyond Thirty (30) months or such extended periods as permitted under this Agreement. The Allottee agrees and understands that the company shall be liable to pay compensation upto the date of grant of Occupation Certificate. The adjustment of such compensation shall be done only at the time of execution of Conveyance Deed of the Said Apartment to the Allottee first named in this Agreement and not earlier. "
• DLF promised club house inside Maiden House campus. Later DLF didn't get approval from govt to build club house inside campus, which I doubt they knew all along because how can they don't know what kind of projects govt approve and what not get approved. DLF now planning to build clubhouse outside Maiden Heights campus and now to use club house we have to travel every day. On asking we should get compensation for that, DLF pointed to below clause in ABA. DLF also added hefty registration(for 2 years) and annual subscription charges in final demand note, clubhouse construction not starting yet. When asked for the explanation of the amount, DLF pointed to below clause. 
• The Allottee agrees and acknowledges that a club / convenience shopping centre is proposed to be planned in the Civic Amenity Area (CA Area) of the Said Complex or in the adjacent land of the Said Complex, which is owned by the Company. The Allottee is aware that the development of club / convenience shopping centre is dependent on the Allottee and association of apartment owners applying to concerned planning authority for transfer of the land for the said club / convenience shopping centre. The Allottee shall ensure and cause the association of apartment owners to apply to concerned planning authority for transfer of the land to the association for development of the club / convenience shopping centre. The Allottee and the association shall further ensure that the land received from the authority is given to the Company for the establishment of the club / convenience shopping centre on the terms and conditions as decided by the Company. The Allottee undertakes, authorizes and gives consent to the Company to apply to the concerned planning authority on behalf of the Allottee / association of apartment owners for giving the CA Area to the Company to establish the club / convenience shopping centre on the land received by planning authority. The Company may in its sole discretion apply to the concerned planning authority for transfer of the CA Area and the Allottee further agrees to execute such other documents, as may be required for the said purpose. The Allottee shall be required to pay an amount of Rs.75,000/- (Rupees Seventy Five Thousand only) (which is subject to increase at the discretion of the Company) towards the development of the club facility. Further upon development of the club, the Company is authorized to manage and maintain the same. The Allottee shall fill in the form for the membership and shall be bound to abide by the terms and conditions of the club. The membership fee shall be for such term, as specified in the detailed terms and conditions for the membership of the club. The Allottee shall also be liable to pay such other charges, as shall be mentioned in the terms and conditions of the club management

                         References :

• personal experience
• http://www.cci.gov.in/sites/default/files/692014_0.pdf

Home Sweet Home

Year 2012 Indian real estate market was on boom, everyone was talking about property price appreciation and where and with which builder they have booked a flat, why rents will become unbearable in future. It was good time, at least for me, until I decided to book a flat.

Me and my girl friend started checking projects across Bangalore and based on a friend's recommendation we booked a flat in SunCity Gloria. It was a beautiful evening. Construction workers has already stopped working so we decided to check out sample houses once more, we were happy before I fell in a pit on the construction site going towards sample houses and had minor injuries on my neck and leg, being a very superstitions person my girl friend heard this as signal from person , apparently sitting somewhere in clouds, that SunCity Gloria is a bad decision. So she tried to convince me that we should cancel the booking and by the evening she searched and found many complaints against SunCity builder. In the lights of these new evidence, I gave verdict and cancel my booking with SunCity Gloria. It was the same day so we simply cancelled our Cheque online. We were very happy whole day, talked about how good our decision is but we didn't know what is going next is even worse. 

We again started searching for flats and visited DLF Maiden Heights site. DLF's flat seem genuine and in our budget. We trusted DLF brand and booked a flat. I don't know if mother nature don't like me or there were some other factors, slow down in real estate market started just after I booked this flat or maybe moment I booked this flat.

Booking my first flat was new experience for me and my girl friend, we were acting like new kid on the block and trying to understand everything. We took Home loan from Axis Bank, and calculated we can clear all the loan amount in 3 years. Being the first house with own money is always existing experience. DLF construction was going smooth and they were sending demand notes as per plan and Bank was dispersing the money. Everything was going so smooth, we thought nothing could go wrong now, but no one could imagine how bad things can go.

Just when we thought everything is going smooth, DLF stopped sending demand note, we waited for 3 months and checked with DLF. DLF told that construction has stopped because of some small dispute and will resume very soon. Because construction was going smoothly and DLF promised to deliver flat within 30 months from initial agreement, we were quite satisfied with their response. Didn't know for DLF very soon mean 8 months, construction resumed after 8 months and we again started getting demand notes and again we thought everything is fine. We got our last demand note before the final demand note and after that everything freezes. It felt as if DLF is doing this first time and as confuse as I was regarding timeline. Somehow, every time when asked about the estimated handover date, they were always planned to handover after 3 months and after 3 months they again ask for 3 more months. I was never allowed to see my flats from inside, one day DLF dropped a happy bomb and invited owners to see their flats on Saturday with restriction, I would term deliberate deny, on number of people each Saturday.So many people including me were not able to see the flat for the first time. After sitting on 90% of money for 2 years DLF finally send happy letter in my email inbox after 4 years from booking, but again it was disappointment disguised as happiness.

It was the final demand note. After checking inflated amounts in demand note, I thought they might be building replica of Taj Mehal for me. Later I found that there is no water supply for my precious Taj Mehal, no club house permissions from govt, it is just a bare flat of cement and bricks and I will be paying huge money for water every month. So my promised land has no water and no club house, DLF planning to build a clubhouse outside the society with our money and apparently, after looking at subscription charges in final demand note, for their own use.

We found there are many differences in what is promised to us and what is constructed. Cost is also inflated as if they have used gold bricks. Buyers Agreement is designed such that it exploits owners and do not give any right on anything for owners. For any questions/objection DLF points to one or another clause in the Buyers agreement. So here I am, gave all the money to DLF for the flat which I haven't seen. 

And I am not alone here, all the owners of DLF Maiden heights and Westend Heights whom I have meet have similar story and are equally confused what to do. 

PS: DLF's one sided and exploitative buyers agreement.
PS: Future Actions.