NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION
NEW DELHI
FIRST APPEAL NO.418 of 2007
(From the order dated 22.05.2007 in Complaint No.10/2000 of the
State Commission, Haryana)
Lt.Col.Mangal Singh Nagal …Appellant
Versus
HUDA & Anr. …Respondents
BEFORE:
HON’BLE MR. JUSTICE ASHOK BHAN, PRESIDENT
HON’BLE MRS. VINEETA RAI, MEMBER
For the Appellant : Mr.S.K.Sharma, Advocate
For the Respondents : Mr.R.B.Badhran, Advocate
Pronounced on 6th September, 2012
ORDER
PER VINEETA RAI, MEMBER
Lt.Col.Mangal Singh Nagal, Appellant herein and complainant before the State Consumer Disputes Redressal Commission, Haryana (hereinafter referred to as the ‘State Commission’) has filed this Appeal being aggrieved by the dismissal of his complaint by the State Commission against Haryana Urban Development Authority and another, opposite parties before the State Commission and Respondents herein.
The facts of the case are that in 1991 Appellant had applied for a 14 Marla plot located in Bhiwani under the category reserved for Defence Personnel by submitting an application along with a draft for Rs.16,020/- to the Respondent/Authority. He was allotted a residential plot No.1643 measuring 299 Sq.Mtrs. located in Sector-13 at Bhiwani vide allotment letter dated 27.08.1991 at a tentative price of Rs.1,60,200/-. The Appellant deposited another Rs.24,030/- on 09.09.1991 so as to constitute 25% of the total tentative price of the allotted plot. He paid the remaining amount in 6 installments. Despite several letters and visits to the Respondent/Authority to hand over the possession of the said plot, Respondent/Authority failed to do so and in 1996 demanded another Rs.1,60,422.50p being the enhanced price of the plot. Appellant refused to pay the same on the ground that till possession of the plot is delivered, Respondent/Authority was not competent to demand the enhanced payment. On 14.10.1998, Respondent/Authority offered an alternative plot to Appellant that since the plot allotted to him was under litigation and development works could not be completed in the near future, Appellant immediately conveyed his consent on 21.10.1998. However, even thereafter Respondent/Authority did not hand over possession of the same on the ground that development works had still to be completed. Appellant again represented to the Respondent/Authority vide letter dated 31.05.1999 and claimed interest on the amount already deposited by him. This was declined by the Respondent/Authority who however insisted that Appellant should pay Rs.1,60,422.50p being the enhanced price of the plot. Being aggrieved, Appellant filed a complaint before the State Commission on grounds of deficiency in service and requested that Respondent/Authority be directed to deliver him possession of the allotted plot in Sector-13 as also interest @ 18% on Rs.1,60,450/- paid by him from the date of deposit till the date of delivery of possession of the plot, Rs.7,00,261.80p as compensation on account of escalation in the cost of construction, Rs.20,000/- towards travelling costs, compensation of Rs.50,000/- on account of mental agony and harassment and Rs.5,000/- as litigation costs.
Respondents on being served denied that there was any deficiency in service in the instant case and inter alia stated that as per the terms and conditions of the allotment letter, possession of the plot in question was to be delivered to the Appellant on completion of development works at the site. Due to circumstances beyond their control e.g., litigation etc., it had not been possible to do so. Further, the Appellant had not paid the enhanced cost of the plot in question and therefore, it was the Appellant who had defaulted. Appellant was also liable to pay interest on the delayed payment.
During the pendency of the case before the State Commission, it was submitted by the Appellant that possession of the plot was offered to him vide letter dated 09.10.2001. To facilitate his taking possession of the plot, Appellant paid the demanded amount i.e. Rs.3,16,627/- of which Rs.1,33,565/- was the interest on enhanced compensation.
The State Commission after considering the submissions as also the evidence filed before it dismissed the complaint by observing as follows:
“Surprisingly enough, in this case the complainant has admitted that he had accepted the offer of possession vide letter dated 6.12.2001 Annexure A-2 placed on record, but still maintained that development was not completed. What was the nature of development work which was not completed, has not been specified. This part of the averments made in the additional evidence filed clearly shows that he wants to attribute the deficiency of service on the part of the opposite parties without any foundation on record in this regard. Rather it is established that this stand has been taken in order to avoid his liability arisen therefrom because for taking possession of the allotted plot, burden was upon him to approach the opposite parties to get the possession of the plot from the opposite parties, rather, he deliberately withheld the payment of the additional price and even deposited Rs.1,00,000/- vide demand draft dated 9.8.2002 towards enhanced price of the plot and thereafter the balance amount on 19.4.2005. These circumstances clearly established his default in performance of his part of the contract as stipulated in the allotment letter.
The next question arises is whether in the given circumstances the complainant is entitled to receive any interest amount for the delayed period of delivery of the allotted plot to the complainant. It cannot be denied that the complainant has been allowed to taken possession of the allotted plot at the old rate and thus got the benefit in the escalation of the price. Therefore, he is not entitled to any interest on the deposited amount.
Regarding the demand made in respect of the escalated cost of construction claimed by him, no doubt he has placed on record affidavit of Shri R.K. Jain, aforesaid Architect and Valuers, who has worked out the escalated cost of construction of two storeys building to be made on his plot by the complainant at Rs.7,68,420.69. The complainant has disentitled himself to get his escalated cost of construction for two reasons. Firstly, that he deliberately has not paid the enhanced compensation amount demanded by the opposite parties and on account of default committed by him contributed to the delayed period of completion of the amenities to be provided. Secondly, that if the amount claimed is allowed it would mean that the complainant would get the land of plot free of cost which cannot be allowed under the circumstances of the case. Under the circumstances of the case the complainant is not entitled to other claims made in the complaint.”
Hence, the present First Appeal.
Learned Counsel for both parties made detailed oral submissions. Counsel for Appellant contended that the State Commission erred in dismissing his complaint without appreciating the facts of the case including the terms and conditions of the allotment letter as also a judgment of the Hon’ble Supreme Court in HUDA Vs. Shanti Devi - 2005(9) SCC 527 which is fully relevant in this case. In that case, Hon’ble Supreme Court had, inter alia, stated that if possession cannot be delivered within a reasonable time, allottees cannot be expected to keep on paying instalments and where the Appellants (in that case HUDA) were not in position to deliver possession they cannot charge interest on delayed payments till after they offer possession. Counsel for Appellant also brought to our notice the terms and conditions of allotment issued by HUDA in wherein it is clearly stated that “interest shall be payable on unpaid amounts from the date of offer of possession”. Keeping in view these facts, Appellant was fully justified in not paying the enhanced compensation amount in the first instance and thereafter interest on this amount for delayed payment as per the judgment of the Hon’ble Supreme Court as also the terms and conditions of the allotment. Therefore, the interest paid on the enhanced amount by the Appellant for the period 14.10.1996 to 09.10.2001 should be refunded to him. Also in the interest of justice, Respondent/Authority must pay the Appellant interest on the tentative price of the plot already deposited by him. Further, view of the certificate of an expert, namely; M/s Jain Architects & Valuers that delay in handing over the possession of the plot had resulted in escalation of the cost of construction by Rs.7,00,261.80p, this amount should also be paid by the Respondent/Authority to the Appellant.
Counsel for Respondents on the other hand while admitting that there was delay in delivery of possession of the plot stated that this was because of prolonged litigation and was, therefore, beyond the control of the Respondent/Authority. As soon as the plot was free of encumbrances and available, possession was handed over to the Appellant. It was further contended that Respondent/Authority was fully justified in asking for the enhanced price of the plot because as per the award given by the Court enhanced compensation had to be paid to the farmers whose land had been acquired in this Scheme. Appellant was also liable to pay interest on this delayed payment as per the laid down policy of Respondent/Authority. Appellant’s demand for interest on the tentative amount deposited by him was not justified as this was not a part of the terms and conditions or the declared policy of the Respondent/Authority. The Appellant’s request for compensation of Rs.7,00,261.80p because of increase in the cost of construction over the years is not borne out by any specific evidence to this effect and the certificate filed in evidence from the Architect and Valuers in support is general and does not give specific details of how the cost of escalation has been worked out. It was also contended that since Appellant had already filed an Appeal on the same issue before the Civil Court/High Court therefore, the present Appeal was not admissible and may be dismissed.
We have heard learned Counsel for both parties and have carefully gone through the evidence on record. The fact that the Appellant had been allotted a plot measuring 299 Sq.Mtrs. in Sector-13, Bhiwani in the year 1995 for which the possession was offered only in 2001 and for which he paid the tentative cost of Rs.1,60,450/- is not in dispute. It is also an admitted fact that Appellant did not pay the enhanced amount of Rs.1,60,422.50p nor the interest thereon as demanded by the Respondent/Authority on the ground that he was not required to do so till a possession letter was issued to him. We find force in this contention of the Appellant keeping in view the judgment of the Hon’ble Supreme Court in Shanti Devi (supra), the relevant portion of which reads as follows:
“As they (HUDA) were not in a position to deliver possession they cannot expect parties like the Respondent i.e. allottees to keep on paying installments to them. In such cases i.e. where Appellants are not in position to deliver possession they cannot charge interest on delayed payments till after they offer possession.”
We have also gone through the terms and conditions of the allotment and we agree with the Appellant’s contention that as per Clause 2(ii)(b) of allotment, interest is to be payable on the unpaid amount only from the date of offer of possession (i.e. from 09.10.2001). Keeping in view these facts, interest on the delayed payment of enhanced price could only be levied by Respondent from 09.10.2001 when the offer of possession was made and not from any earlier date. In view of these facts and respectfully following the judgment of the Hon’ble Supreme Court in Shanta Devi (supra), we set aside the order of the State Commission upholding the levying of penal interest on the enhanced amount from 14.10.1996 to 09.10.2001.
Regarding Appellant’s demand for compensation of Rs.7,00,261.80p on grounds of enhanced cost of construction, we agree with the Respondent/Authority that certificate of the Architect & Valuers filed in support is of a general nature and does not specify the enhanced costs of the major construction materials e.g. bricks, iron etc. in the absence of which, we are unable to accept this certificate. Appellant’s contention that he be paid interest on the initial deposit of Rs.160,422/- being the tentative price of the plot allotted to him is also not acceptable since there is no provision for payment of interest in the policy of the Respondent/Authority in this connection.
To sum-up, we partly allow the First Appeal and direct the Respondent/Authority to refund the penal interest paid by the Appellant on the delayed payment of Rs.1,60,422/- from 14.10.1996 to 09.10.2001 i.e. from the date of demand of this amount till the date of offer of the possession to the Appellant, within a period of 8 weeks from the date of receipt of this order failing which it will carry interest @ 9% per annum from the date of default. We further direct that the Appellant be paid Rs.20,000/- for mental agony and harassment and Rs.5,000/- as costs.
The First Appeal is disposed of on the above terms.
Sd/-
…………..…………………
(ASHOK BHAN J.)
PRESIDENT
Sd/-
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(VINEETA RAI)
MEMBER
/sks/
