'Money Kept For Stamp Duty Isn’t Actual Statutory Payment': Bombay HC Upholds Developer’s Termination

According to a report by Free Press Journal… Mumbai, September 25, 2026: Merely parking money in a bank account meant for stamp duty and registration charges does not amount to actually paying the statutory dues, the Bombay High Court has held while upholding a developer’s decision to cancel a homebuyer’s allotment for failing to complete the transaction.Justice Sandeep Marne observed that a homebuyer cannot claim to have paid stamp duty merely because money was transferred to a bank account from which the statutory payment was supposed to be made. The court found that in the present case, the Rs 4.65 lakh transferred by homebuyer Santosh Sandhu was never credited to the concerned stamp or registration authorities.“Merely making provision for stamp duty and registration charges and transfer of the amount to the banker does not mean that stamp duty and registration charges were actually paid by the allottee,” Justice Marne said.Dispute Over Flat AllotmentThe court was hearing a petition filed by JP Builders and Developers challenging orders of the Maharashtra Real Estate Regulatory Authority (MahaRERA) and Maharashtra Real Estate Appellate Tribunal (MahaREAT), which had directed it to execute a registered agreement for sale with Sandhu.The dispute related to Flat No. A-502 in the developer’s Airoli, Navi Mumbai project. The flat could not be constructed after the project was scaled down from ground-plus-30 floors to ground-plus-19 floors. Sandhu was consequently offered an alternative flat, No. 1208.Buyer Failed To Pay ChargesAdvocates Vishal Kanade and Rajesh Vanzara, representing the developer, submitted that the developer repeatedly called upon him to complete the agreement and pay the applicable stamp duty and registration charges through notices issued on May 3, May 28 and June 24, 2019. Sandhu, however, said he needed three months to arrange the money and alternatively asked the developer to initially pay the charges and recover them through his proposed home loan.Sandhu subsequently claimed that he had paid Rs 4.65 lakh towards the charges. However, bank records showed that no challan or e-SBTR was generated and the money remained with Punjab National Bank instead of reaching the authorities. The amount was later reversed after Sandhu sought its return in January 2020.HC Upholds Allotment TerminationThe developer terminated the allotment on July 30, 2019. While MahaRERA and MahaREAT directed the developer to execute the agreement, the High Court found that the authorities had not properly examined whether the statutory charges were actually paid.“The allottee himself is responsible for non-execution of the Agreement for Sale,” the court said, adding that the promoter “is not expected to wait endlessly.”Also Watch: Bombay HC Upholds State’s Choice Of Purandar Airport Site 1A, Refuses To Interfere In Land AcquisitionThe HC therefore upheld the termination and set aside the directions requiring the developer to execute the agreement.However, it directed the developer to refund the Rs 12.30 lakh already paid by Sandhu, with interest at SBI MCLR plus 2 per cent per annum from July 12, 2016, until repayment. It also barred any deduction towards earnest money.To get details on exclusive and budget-friendly property deals in Mumbai & surrounding regions, do visit: https://budgetproperties.in/ complete report is on link below. Source: https://www.freepressjournal.in/mumbai/money-kept-for-stamp-duty-isnt-actual-statutory-payment-bombay-hc-upholds-developers-termination