2025 INSC 398
SUPREME COURT
OF INDIA
(HONBLE
J.K. MAHESHWARI, J. AND ARAVIND KUMAR, JJ.)
THE CHIEF
OFFICER, NAGPUR HOUSING AND AREA DEVELOPMENT BOARD (A MHADA UNIT) AND OTHERS
Appellant
VERSUS
MANOHAR
BURDE
Respondent
Civil
Appeal No.
Of 2025 Special Leave Petition (Civil) No. 3802 OF 2024-Decided on 26-03-2025
Consumer
Consumer
Protection Act, 1986, Section 2(1)(g) and 14(1)(d) Constitution of India,
Article 227 Consumer - Delay in delivery of plot possession Refund Interest Compensation Held that the
NCDRC having taken note of the relevant aspects including the factum of delay
and the fact that petitioner had opted for refund of money deposited, rightly
held that as a home buyer, petitioner cannot be compelled to take possession of
the flat after such long time, and as such ordered for refund of entire amount
deposited with interest of 9% p.a. - Awarded interest @ 9% p.a., by NCDRC held
to be fair and reasonable - The interest @ 15% p.a. awarded by High Court is
excessive - Impugned order set-aside and the order dated 27.07.2022 passed by
NCDRC in so far as it relates to award of interest @ 9% on the respective
deposit till the date of actual payment
restored - Having regard to the fact that the appellant herein is an
instrumentality of State, the delay if any, cannot be attributed to any
personal animosity of the officers manning the institution and they have been
discharging the statutory duties - Considering the aforesaid and in the
peculiar facts and circumstances of the case, deem it proper to reduce the
compensation payable from Rs. 10,00,000/- to Rs.7,50,000/-as it would meet the
ends of justice.
(Para 14 and 15)
JUDGMENT
Aravind Kumar, J. :-Leave granted.
2. Heard learned counsels
appearing for the parties. In the present appeal, the order dated 29.01.2024
passed by the High Court of Judicature at Bombay, Nagpur Bench at Nagpur in
Writ Petition No. 5052 of 2022, whereby the Writ Petition came to be allowed, and
order dated 27.07.2022 passed by the National Consumer Disputes Redressal
Commission (herein after referred to as "NCDRC" in short) in Appeal
No. 796 of 2019 came to be quashed, is being questioned. The parties are
referred to as per their rank in the High Court.
3. The facts in brief
leading to filing of this appeal are as under -
The
Respondents launched a Group Housing Project in year 2009. Pursuant to the
same, the petitioner applied for a 3 BHK flat and deposited the requisite
amount of Rs. 4,00,000/- on 23.09.2009 and by virtue
of lottery drawn on 03.01.2010, petitioner was allotted a flat. In furtherance
of the allotment, the petitioner had to pay the balance consideration in eight
(8) instalments, out of which he deposited seven (7) instalments between
31.12.2011 to 31.03.2013 and the eighth (8th) instalment was deposited on
26.08.2013 on the assurance that possession of flat will be delivered timely.
The prime grievance of the petitioner is two-fold,
firstly, the delivery of possession of the flat was delayed and secondly,
demand of additional amount posing the threat of cancellation of allotment. The
said amount was paid by the petitioner, however in vain, it did not yield any
result or possession of the flat was delivered to the petitioner.
Hence,
alleging deficiency in service and unfair trade practice, the petitioner filed
a complaint before the State Consumer Disputes Redressal Commission (in short
"SCDRC"), which came to be allowed vide order dated 20.02.2017 with a
direction to the authorities to deliver possession within six (6) months and to
pay interest @ 15% p. a. for the period of delay w.e.f. July 2013 till handing
over of possession. The same was challenged by the respondents in First Appeal
No. 1741 of 2017 and the case was remitted to the SCDRC for adjudication on
merits afresh.
4. On remand, the SCDRC by
order dated 07.02.2019 partly allowed the complaint and directed the respondent
to complete the construction of the allotted flat along with a direction to
Respondent Nos. 1, 2 & 3 therein to pay interest @ 15% p.a. to the
complainant for the delayed period w.e.f. 01.07.2013 till delivery of the
possession of flat on the amount paid by the complainant. It was further
ordered that, in the event construction is not completed, the amount paid by
the complainant should be refunded along with interest @ 15% p. a. from the
date of respective payments till realization along with compensation of Rs. 10,00,000/- towards loss suffered by him; and, Rs. 1,00,000/-
towards physical and mental harassment along with Rs. 25,000/- towards
litigation cost.
5. The respondents being
aggrieved, preferred appeal before NCDRC which was partly allowed by order
dated 27.07.2022 and respondents were directed to refund the entire amount
deposited by the complainant with interest @ 9% p.a. against interest @ 15% as
directed by SCDRC. The NCDRC also directed payment of Rs. 50,000/- as
consolidated costs. The respondents filed a review being R.A. No. 180 of 2022
seeking review of the order dated 27.07.2022, which was also dismissed by NCDRC
vide order dated 26.08.2022.
6. The respondents being
aggrieved by the orders dated 27.07.2022 and 12.08.2022, filed Special Leave
Petition (C) No. 25157 of 2023 before this Court, which stood dismissed by
order dated 06.11.2023.
7. However, being aggrieved
by the aforesaid order dated 27.07.2022, the petitioner (complainant) filed
W.P. No. 5052 of 2022 before the High Court of Judicature at Bombay, Nagpur
Bench, which was allowed vide impugned order setting aside the order passed by
the NCDRC and granting the reliefs as sought in the Writ Petition.
8. The High Court opined
that there was delay on the part of the respondent in not completing the
construction within the agreed period and there has been delay at all stages.
It also took note of the fact that the reduction in the rate of interest by
NCDRC to 9% p.a. from 15% p.a. was not for any justifiable reason. Hence,
setting aside the order passed by NCDRC, the High Court awarded interest @ 15%
p.a. on the entire amount paid by the petitioner from the date of respective
deposit till date of payment/refund of the amount. Therefore,
this appeal.
9. This Court while issuing
notice on the present Special Leave Petition vide order dated 19.02.2024 had
passed the following orders:
"1.
On instructions, it is stated by Mr. Shyam Divan, learned senior counsel for
the petitioners that approximately 100 cases are coming against the
petitioners, which may have adverse impact, if payments are allowed, under the
impugned order.
2. It
is also informed by Mr. Shyam Divan, learned senior counsel that the
petitioners have already deposited the entire amount along with the interest at
the rate of 15% per annum including Rs. 10 Lakhs.
3. Considering
the aforesaid, issue notice, returnable in six weeks.
4.
Further, we direct that in execution or otherwise, the respondent would be
entitled to receive the amount under the order impugned along with the interest
at the rate of 9% per annum and the remaining amount of interest and Rs.10 Lakhs, shall be detained in the account. The remaining
amount shall be kept in short term auto renewal fixed deposit. "
10. On service of notice,
the petitioner appeared in-person and filed the counter affidavit reiterating
the contentions raised before the SCDRC and High
Court.
11. We have heard the
arguments of Mr. Tushar Mehta, learned Solicitor General appearing for the
respondents and Shri Manohar Burde, appearing in person and perused the
material placed on record.
12. Mr. Tushar Mehta
appearing for the respondents strenuously argued that the High Court was not
justified in exercising its supervisory jurisdiction under Article 227 of the
Constitution of India to modify the well-reasoned findings of NCDRC which had
balanced the scale by evaluating the evidence of the parties including
pleadings and thus allowing the Writ Petition by granting enhanced interest @
15% p.a. is not only exorbitant, but also contrary to the principles of law
enunciated by this Court. He also urged that when petitioner had opted for
refund of amount, at the most the interest at a reasonable rate could have been
awarded as was done by the NCDRC. Awarding an interest @ 15% p.a. on payment
made by the complainant coupled with additional compensation of Rs. 10,00,000/- is unjustifiable. Hence, he prayed that appeal be
allowed and impugned order be set-aside.
13. The petitioner appearing
as party in person argued in support of the impugned order and contended that
there have been repeated defaults on the part of the statutory authorities and
explicit deficiency of service on part of the developer, hence interest @ 15%
p.a. on account of inordinate delay is just and appropriate warranting no
interference under Article 136 of the Constitution of India. Hence, he prayed
for dismissal of the appeal.
14. Having heard the learned
advocates appearing for the parties and on perusal of the case papers, we are
of the considered view that the NCDRC having taken note of the relevant aspects
including the factum of delay and the fact that petitioner had opted for refund
of money deposited, rightly held that as a home buyer, petitioner cannot be
compelled to take possession of the flat after such long time, and as such
ordered for refund of entire amount deposited with interest of 9% p.a. Placing
reliance on the law laid down by this Court in 'Bangalore Development Authority
v. Syndicate Bank, (2007) 6 SCC 711 \ wherein a co ordinate Bench of this Court
dealing with the question of grant of relief to a consumer in cases of delay of
delivery of possession held that when possession of the allotted
plot/flat/house is not delivered within the specified time, the allottee is
entitled to a refund of the amount paid with reasonable interest thereon from
the date of payment till the date of refund. The Court summarized the general
principles and in particular para 10(f) observed as follows -
"(f)
Where the plot/flat/house has been allotted at a tentative or provisional
price, subject to final determination of price on completion of the project
(that is acquisition proceedings and development activities), the development
authority will be entitled to revise or increase the price. But where the
allotment is at a fixed price, and a higher price or extra payments are
illegally or unjustifiably demanded and collected, the allottee will be
entitled to refund of such excess with such interest, as may be determined with
reference to the facts of the case."
In
the present case, the High Court by the impugned order modified the finding of
NCDRC and awarded interest @ 15% p. a. primarily relying upon the judgment of
this Court in 'Rohit Chaudhary and another v. VipulLtd., (2024) 1 SCC8,
wherein this Court in order to balance the equities and to compensate the loss
caused to the purchaser/complainant who had booked an office premise for his
use, directed the refund of the amount paid along with interest @ 12% p. a.
from the date of complaint till the date of payment. However, the issue in the
instant case relates to allotment of a 3 BHK flat after payment of sale
consideration and delay in delivery of same. As such, the NCDRC considering the
entirety of the facts and circumstances of the case,
had awarded interest @ 9% p.a., which in our view was fair and reasonable. The
interest @ 15% p.a. awarded by High Court is excessive. Therefore, the impugned
order hereby is set-aside and the order dated 27.07.2022 passed by NCDRC in so
far as it relates to award of interest @ 9% on the respective deposit till the
date of actual payment is restored.
15. As already discussed
above, this Court at the time of issuing notice on this appeal, noted that the
appellants have already deposited the entire amount with interest @ 15% p.a.
including Rs. 10,00,000/- as ordered by SCDRC. Having
regard to the fact that the appellant herein is an instrumentality of State,
the delay if any, cannot be attributed to any personal animosity of the
officers manning the institution and they have been discharging the statutory
duties. Considering the aforesaid and in the peculiar facts and circumstances
of the case, we deem it proper to reduce the compensation payable from Rs.
10,00,000/- to Rs.7,50,000/-as it would meet the ends of justice. Accordingly,
the order stands modified to the extent above referred to. The appeal stands
partly allowed with no order as to costs. Pending application(s), if any, shall
stand consigned to records.
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