IN THE HIGH COURT OF JUDICATURE AT PATNA CWJC No.2858 of 2004 MAHENDRA PRASAD SINGH son of Parmeshwar Mahto, resident of Village Tara, P.S. Khudabandpur, District- Begusarai at present M.M. Industries, Kankarbag Road, Patna-20 …petitioner. Versus 1. THE BIHAR STATE HOUSING BOARD, Patna through its Managing Director. 2. The Secretary Bihar State Housing Board, Patna. 3. The Land Property Officer-cum-Legal Officer, Bihar State Housing Board, Patna. 4. The Executive Engineer, Bihar State Housing Board, Patna, Parmandal- 3 …Respondents. ----------- For the petitioner: Mr. Nagendra Kumar Singh, Advocate For the respondent Housing Board : Mr. R.S. Pradhan, Sr. Advocate. Mr. Binod Kumar, Advocate. 2 23.03.2011 Heard the parties. 2. The petitioner has approached this Court under Article 226 of the Constitution of India by filing the present writ petition seeking a direction upon the respondent Bihar State Housing Board Patna, through its Managing Director (respondent no.1) for refund of Rs. 6500/- with 18% interest, which was deposited by the petitioner on 7.2.1981 as an earnest money for allotment of a MIG flat/house at Hanuman Nagar, Patna. 3. It is admitted case of the parties that on 2.8.1995 on the basis of a draw by lottery, the petitioner was allotted a M.I.G. flat/house bearing No. 7 M.F. 3/66, although the petitioner had deposited Rs. 6500/- only towards earnest money till that date. The order of allotment has been brought on record by the respondents as Annexure-B with the supplementary counter affidavit filed on behalf of respondents 1 to 4. According to the aforesaid order of allotment total tentative cost of M.I.G. house was fixed to be Rs. 2, 52, 862/-. As per clause 4 of the allotment 2 order, the petitioner was obliged to deposit Rs. 69,359/- within 30 days and balance amount was required to be paid in installments. As per clause 8 of the allotment order possession was required to be given to the allottee only on payment of price and fulfillment of other conditions indicated in that allotment order. It was also indicated in the allotment order that if the payments are not made within the time prescribed, then it will be treated to have been cancelled. 4. Learned counsel appearing on behalf of the petitioner submits that after allotment of the flat in question in favour of the petitioner, same was subsequently allotted to some other person of the Railway Department and, therefore, the petitioner did not deposit the further amount and, he finally filed an application on 10.8.2002 for refund of the earnest money with interest. 5. Learned counsel appearing on behalf of the respondents has placed reliance on the averments made in the counter affidavit filed on behalf of respondent Bihar State Housing Board(in short Housing Board) as also in the supplementary counter affidavit filed on behalf of respondents 1 to 4. According to the respondents, the petitioner is himself defaulter having not deposited the prescribed amount indicated in the letter of allotment and, therefore, the petitioner cannot claim refund of entire earnest money deposited by him. 6. Mr. R.S. Pradhan, learned senior counsel appearing on 3 behalf of the respondents has drawn attention of the court towards the provisions of clause 33 and 45 of Bihar State Housing Board (Management And Disposal of Housing Estates), Regulation, 1983 (hereinafter referred to as the Regulation). For ready reference clause 33 and 45 of the Regulation are reproduced hereinbelow: [33. “(1) Immediately after decision on allotment of dwelling units/flats/sites has been taken, the applicant under High Income Group and Middle Income Group shall be required to pay/deposit equal to 30 per cent of the disposal price, but the applicants under Low Income Group and Economically Weaker Section, shall be required to pay deposit equal to 20 per cent of the disposal price. Such deposit shall be non-interest deposit.”] (2)An applicant to whom a dwelling unit or flat/site has been allotted have to pay the balance amount of the disposal price (i.e after adjusting the deposit) within such period as may be determined by the Board and specified in the allotment order/letter. (3)If the applicant fails to pay the amount within the said specified period, the allotment shall be cancelled and a sum of money equal to 20 per cent of the deposit shall be forfeited and the balance refunded. (4) In the case of such applicants as have not been finally allotted any dwelling unit/flat/site the deposit specified in sub- regulation (1) shall be refunded. (5) The Board shall have the sole and exclusive right over the deposit till it is adjusted or refunded with or without deduction as provided in these regulations. 45. Simple interest at the rate of 5 per cent will be payable on the amount of earnest money deposited by the applicants, after the date of enforcement of this regulation. No interest will be payable on deposits made hereinbefore.” 4 7. Mr. Pradhan, learned counsel for the respondents submits that in view of provisions contained in sub-clause-3 of clause 33 of the Regulation, the petitioner is entitled to have the refund of earnest money only after forfeiture of 20% of the earnest money as he has failed to deposit the price of the house/flat as per the terms of order of allotment. According to him in view of clause 45 of the Regulation, since earnest money was deposited in 1981 itself prior to coming into force of the Regulation with effect from 24.05.1983, therefore, the petitioner is not entitled for the interest even on the balance amount of the earnest money after deducting 20%. He has produced a cheque of Rs. 5,200/- dated 25.2.2011 issued by an officer of the respondent Housing Board in favour of the petitioner. He submits that after payment of Rs. 5,200/- to the petitioner through the aforesaid cheque dated 25.2.2011, the respondent housing Board is not required to make any further payment to the petitioner and the entire dispute should come to an end.In support of his contention he has placed reliance on a Judgment/order dated 9.3.2006 passed in C.W.J.C. No. 1720 of 2003 by a Single Judge, which has been affirmed by the Division Bench of this Court. 8. After hearing the parties and on consideration of materials available on record, this court finds that a M.I.G. house was allotted in favour of the petitioner on 2.8.1995. Formal order of allotment was issued subsequently. Admittedly, the 5 petitioner has not deposited any amount except earnest money deposited by him in the year 1981. Therefore, in view of terms and conditions of the order of allotment, the petitioner was not entitled for possession over the house in question. The order of allotment was also liable to be cancelled. In fact the petitioner is also not raising any grievance regarding cancellation of allotment order. 9. Only grievance raised on behalf of the petitioner is that he is entitled for refund of entire earnest money with interest. In view of the provisions contained in Clause 33(3) of the Regulation, the claim made on behalf of the petitioner appears to be misconceived. In view of the fact the petitioner himself is a defaulter, he cannot claim refund of 100% of earnest money. In fact, he is entitled to get refund of earnest money after forfeiture of 20% of the said amount. The Housing Board has already produced a cheque to that extent. 10. However, this does not dispose this proceeding. The question of interest still remains to be decided by this Court. Clause 45 of the Regulation prescribes that simple interest @ 5% will be payable on the earnest money deposited by the applicant from the date of coming into force of the Regulation. It has been provided that no interest will be payable on the deposit made prior to coming into force of the Regulation. This does mean that any earnest money deposited prior to 24.5.1983 shall not earn any interest till that date i.e. 24.5.1983, but this cannot 6 mean that the earnest money deposited prior to 24.5.1983 shall not earn even simple interest of 5% even after 24.5.1983. Admittedly earnest money deposited by the petitioner remained with the Housing Board even after 24.5.1983. Therefore, in the considered opinion of this Court, the respondent Housing Board is obliged to pay simple interest @ 5% per annum on the amount payable to the petitioner with effect from 24.05.1983 till the actual date of payment of the balance earnest money. In the present case a cheque of Rs. 5,200/- has been produced in the court today. Therefore, respondent Housing Board and its officers are hereby directed to calculate the interest @ 5% per annum with effect from 24.5.1983 till today and make payment of the same to the petitioner within a period of four weeks, failing which it shall carry interest @ 9% per annum from that date. 11. A cheque of Rs. 5,200/- along with a letter dated 25.2.2011 issued by the Estate Officer of the Respondent Housing Board has been received by Mr. Nagendra Kumar Singh , learned counsel appearing on behalf of the petitioner and he has made endorsement in the order sheet in token of receipt of the said cheque along with order. 12. With the aforesaid observations and directions this writ petition stands disposed of. No costs. Rahman ( Birendra Prasad Verma, J.) 7