Bangalore Development Authority vs Syndicate Bank

2. The Banglore Development Authority (Appellant herein, 'BDA' for short) introduced a "Self Financing Housing Scheme" for construction of flats/houses in Banglore in the year 1982. The said Scheme contemplated construction of three types of flats/houses categorized as Higher Income Group, Middle Income Group, and Low Income Group ('HIG', 'MIG', and 'LIG' for short). Under the said scheme an applicant for allotment was required to make an initial deposit of 15% of the cost of the unit and pay the balance in eight quarterly instalments of 10% and the last instalment of 5%.

4. BDA had initially fixed the tentative price of a HIG house as Rs.2,85,000/-. The price was revised to Rs.4.75 lakhs per unit (Rs.5.5 lakhs in respect of corner units). By letter dated 22.08.1985, BDA informed the respondent about the revision of price of HIG Houses from Rs.2.85 lakhs to 4.75 lakhs per unit. BDA also indicated the total amount due in respect of 15 HIG Houses and required the Respondent to pay the said amount in installments as shown in the Annexure thereto. BDA also informed the Respondent that the units would be ready for occupation in December, 1986. As respondent did not pay the instalments, BDA sent a letter dated 20.10.1986 demanding payment. By letter dated 27.5.1987, BDA informed Respondent that 15 Houses (including three corner houses) had been allotted to Respondent on 16.1.1987 and furnished the numbers of the houses allotted.

6. BDA delivered 4 HIG houses in December, 1989 and May, 1990. The completion of construction and delivery of remaining 11 H.I.G. houses (in RMV Extension, Bangalore) was delayed. By letters dated 29.11.1989, 17.01.1990, 9.7.1993 and 11.1.1994, the Respondent pointed out the delay in delivery of the HIG houses and requested for early delivery of possession of the houses. Respondent also demanded interest on the price paid, at the bank rate from 01.01.1986 till date the delivery of the houses apart from reimbursement of the losses incurred on account of the non-delivery. When the officers of the respondent met the officers of BDA personally to enquire about the 11 Houses, they were informed that the delay was on account of the contractor (M/s. Khoday Engineering) raising a dispute and stopping the work in respect of part of the project, and assured that possession will be delivered immediately after completion. The Respondent issued a final notice dated 11.07.1994 through counsel demanding performance within one month. When BDA failed, the respondent filed a complaint before the Commission under section 21 of Consumer Protection Act, 1986 ('Act' for short).

c) It would complete and deliver the 11 houses within a short time at the agreed price, though price of the houses had risen by 10 times.

5. A sum of Rs.98,85,210/- paid by the Respondent towards the cost of LIG units became refundable to respondent, on account of surrender of allotment of the 125 LIG units. The cost of 15 HIG houses was Rs.73.5 lakhs (that is, three corner units at the rate of Rs.5.5 lakhs each and 12 other units at the rate of Rs.4.75 lakhs each). The respondent had paid a sum of Rs.19,33,925/- in advance towards the cost of the 15 H.I.G. houses and the balance due was Rs.54,16,075/-. By letter dated 15.5.1989, BDA adjusted and appropriated the said sum of Rs.54,16,075/- (due in respect of 15 HIG Houses) and a sum of Rs.21,66,250/- (due in respect of MIG Units), from out of Rs.98,85,210/- paid towards LIG units, and refunded the balance of Rs.23,02,885/- to the Respondent. Thus it would be seen that the cost of H.I.G. units was received by BDA only on 15.05.1989.

13. As already noticed, where the grievance is one of delay in delivery of possession, and the Development Authority delivers the house during the pendency of the complaint at the agreed price, and such delivery is accepted by the allottee-complainant, the question of awarding any interest on the price paid by him from the date of deposit to date of delivery of possession, does not arise. The allottee who had the benefit of appreciation of price of the house, is not entitled to interest on the price paid. In this case, the 11 houses were delivered in 1997 at the agreed prices (Rs. 5.5 lacs per corner HIG House and Rs.4.75 lacs per other HIG Houses). In view of it, the order of the Commission awarding interest at 18% per annum on the price of the houses is unsustainable and liable to be set aside.

Whether respondent is entitled to any compensation?

Conclusion

20. In view of the above, we allow this appeal and set aside the order dated 11.4.2002 of the National Consumer Disputes Redressal Commission. As the main prayer for completion and delivery of the houses was complied with during the pendency of the complaint, and as we have held that respondent is not entitled to interest or compensation, the complaint is disposed of with a direction to BDA to complete the process of execution and registration of sale deed/s in respect of the houses without claiming any extra cost, within three months from today. The cost of stamp duty and registration in respect of such sale deeds will be borne by the respondent. Parties to bear their respective costs.