H.U.D.A vs Prem Kumar Agarwal & Anr

3. The Commission was considering various cases and the case of HUDA v. R.P. Chawla (Revision Petition Nos.17-18 of 1997) was taken as an illustrative case. Ultimately, the Commission came to hold as follows:

12. The National Forum in the lead judgment has considered the authorities of this Court in the case of Ghaziabad Development Authority v. Dhanesh Chand Goel and the case of Haryana Urban Development Authority v. Rajnish Chander Sharda. From these decisions, the National Forum has concluded that award of interest at the rate of 18% per annum on amount deposited by the allottee where there is a delay in handing over possession is reasonable and could be awarded on equitable grounds. In our view, this conclusion of the National Forum is not correct. In Dhanesh Chand Goel case the facts were gross. Those facts have been set out in the order of the National Forum itself. Those facts show that GDA started a scheme for allotment of houses in Governdpuram. Dhanesh Chand had applied for allotment. He had paid the amount. He had been intimated on 16-11-1993 that he had been allotted a house, as per the draw held on 20-10-1993. Thereafter in 1996 he was informed that there was an increase in the price. He did not pay the increased amount and therefore possession was not given to him. It appears that the flat which had been allotted to him was thereafter allotted to one Shanti Suraksha Bal. Shri Dhanesh Chand was asked to give his option for allotment in some other scheme at a different place. It is under those circumstances that refund was directed with interest at the rate of 18% per annum. This Court while dismissing the special leave petition was careful enough to record that the rate of 18% interest per annum was reasonable given the facts recorded by the lower authority. Thus, this case shows that if the facts are gross then 18% interest could be given but the Forum must first conclude that the facts justify grant of interest at such a rate. Similarly, in Rajnish Chander Sharda case the facts were such that they justified a grant of interest at the rate of 18% per annum. This Court has noted that there was delay in delivery of possession and in the meantime the complainant had been compelled to live in rented accommodation and pay Rs.1600 per month. This Court has noted that interest at 18% was given instead of directing the body to compensate for the loss caused i.e. at the rate of Rs.1600 per month. It is on those facts that this Court upheld the grant of interest @ 18% per annum. Far from showing that these authorities justify grant of interest at 18% in all cases irrespective of the facts, the authorities of this Court clearly indicate that interest at such rate is to be granted only when the facts so justify.

19. That brings us to the question as to the date from which interest would be payable. Normally in cases of refund interest will be payable from the date the monies were deposited with the body till they are returned either by payment to that party or deposited in a court. In cases where compensation is directed to be paid, the Commission/Forum must direct payment within a particular period and further direct that if payment is not made within that time the authority will also pay interest. Such interest must be based on the current rate of interest.

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24. We clarify that in all cases where interest has already been paid @ 18% irrespective of the above order, the authority will not be entitled to call upon the party to refund the amount which has already been paid. (underlined for emphasis)

9. The appeal is allowed to the aforesaid extent. No costs.