Bhag Singh Sain vs K.K.MAHAJAN

BY this petition under Section 27 of the Consumer Protection Act, 1986, the petitioner has sought implementation of the order of this Commission dated 5th August, 1992 and for punishment of the respondent-Contemner.

THE first grievance of the petitioner is that vide letter of the Shimla Development Authority (hereinafter to be referred to as the Authority) dated 26.9.92 (AnnexureA-2), he has been asked to pay the amount of interest shown at Sr. No. 3 of the letter on revised cost payable by the allottee i.e., Rs. 18,098/-. This amount is the amount of interest calculated by the Authority on the delayed payment of the balance amount i.e. Rs. 46,859/- demanded vide their letter dated 2.11.90, AnnexureA-6, as according to them, this should have been paid within 90 days from the date of issue of that letter i.e. 2.11.90. No doubt, according to them, the date for payment of the balance amount has been extended by the Commission for 90 days from the date of the order but there is nothing in the order which precludes in any way or prohibits the authority from realising the interest on delayed payment if 90 days are taken into consideration for the payment of the balance amount with effect from 2.11.90, the date of issue of the letter aforementioned. In the complaint, the petitioner has challenged the letter of the Authority dated 2.11.90, Annexure A-6, whereby the balance amount on account of enhancement/escalation of the price of the plot was asked to be paid within 90 days from the date of issue of the letter. This Commission, no doubt, has upheld the enhanced price and the balance which is payable by the petitioner on this account but has awarded interest @ 18% per annum to him on the amount deposited by him as per directions of the judgment and the time for payment of the balance amount was also extended for 3 months from the date of the order of the Commission.

The controversy revolves around the question whether the direction issued by this Commission in this context disentitles the Authority to charge interest on the balance amount for the period beginning from 2.2.91 i.e., after the expiry of 3 months from the date of issue of the letter dated 2.11.90 till the payment is made of the balance amount by the petitioner. In this background, the following direction of the Commission may be noted which is contained in para 10(a) of the order: "10(2) the complainant entitled to and so direct respondent. Shimla Development Authority, to hand over possession of developed plot No. 1Type-B in Section-1. Lane- 4 having total area of 120.31 sq. meter no sooner the complainant completes the requisite formalities including payment of outstanding amount shown against him vide the respondent''s letter dated 2.11.90 for which purpose the maximum period of 90 days stipulated in the aforesaid letter would further run from the date of this judgment".

IN this connection, para 3 of the letter dated 2.11.90 may also be noted: "3. You shall deposit a sum of Rs.46,859/-(Rupees forty-six thousand eight hundred and fifty-nine) only as de tailed below within 90 days from the date of issue of this letter (the last day being hereinafter referred to as the "due date") failing which the allotment shall be liable to be cancelled and your deposit will be refunded after forfeiting such amount as provided in para-8 or this allotment letter".

According to para-3 of the letter, the petitioner was required to deposit a sum of Rs. 46,859/- shown as balance amount payable by him within 90 days from the date of issue of that letter. However, the Commission has extended the maximum period of 90 days for payment of balance amount as contemplated in letter dated 2.11.90 from the date of the order of the Commission. Cumulative reading of the letter as well as order of this Commission leaves no manner of doubt and makes position so explicitly clear that the period for the payment of the balance amount payable by the petitioner as required vide letter dated 2.11.90 will run from the date of the order of this Commission instead of 2.11.90, the date of the issue of the letter.

IT is not disputed that the petitioner has paid the balance amount within 90 days of the date of the order of this Commission. It goes without saying that the Authority can charge interest only if there is a delayed payment. When the amount undisputedly has been paid by the petitioner within 3 months of the date of the order of this Commission, it cannot be said by any stretch of imagination that there has been delay in making the payment of the balance amount and hence in these circumstances the charging of interest on the balance amount does not arise. The interpretation given by the Authority of the so-called delayed payment of the balance amount is not only wholly mis-conceived but betrays complete non-application of mind by the responsible officers of the Authority. Such gross mis-interpretation could have been avoided by a bit of application of mind and due diligence. Therefore, we have no hesitation to hold that the amount of interest at Sr. No. 3 for an amount of Rs. 18,098/- calculated by the Authority vide their letter dated 26.9.92, Annexure A-2, is contrary to the directions given by this Commission and the petitioner is not liable to pay this interest.

THE next other main grievance of the petitioner is that the Authority is also claiming vide their letter dated 11.8.93, Annexure A-4, further amount of Rs. 41,146/- on account of enhancement in land compensation by the District Judge because of land acquisition proceedings. According to the petitioner in para-4 of the judgment, the matter stands already adjudicated by the State Commission and this Commission has observed that the prices now worked out are final and subject to no further escalation. Reference has also been made to the affidavit filed by the C.E.O.-cum-Chief Engineer of Shimla Development Authority dated 28.11.91 in this background. This escalation on account of enhanced price because of the land acquisition proceedings now demanded by the Authority is in clear violation of the observations and directions given in para-4 of the judgment.

WE are unable to accept this contention. Firstly the matter of enhancement of compensation on account of land acquisition proceedings was not a subject-matter of the complaint and is a later development. Such issue has not been adjudicated by the Commission and, therefore, such observations do not bind the parties. Secondly, while taking delivery of the possession, the petitioner has entered into a Hire Purchase Agreement dated 30.9.92, Annexure R-l and in Annexure-A to the Hire-Purchase Tenancy Agreement - term and Condition No. 1 provides that notwithstanding anything to the contrary, if considered essential, the Shimla Development Authority may revise consideration in the event of enhancement of land compensation and such a determination shall be final and the allottee or the hirer shall be precluded from making complaint or raising any objection or setting up any claim in this behalf at any stage. This question whether or not the price on account of enhanced land acquisition charges can be charged in Self Financing Scheme, has been considered by the Supreme Court in case Shimla Development Authority v. Asha Rani, Civil Appeal No. 4388 of 1996 decided on 26.2.96. Relevant extract of the order of the Supreme Court may be reproduced below: "The admitted position, as stated earlier, is that the land of a private owner was acquired under the Land Acquisition Act for the Self Finance Scheme. As a matter of fact, when scheme is for construction and allotment of the houses to the allottees is initiated, allottee is bound to bear the cost of the value determined by the Civil Court under Section 26 of the Land Acquisition Act by award and decree or thereafter if an appeal is filed and further increase is made under Section 54 of the Act. In this case, admittedly, on reference under Section 18, the Court had determined the compensation by award and decree made under Section 26 on April 30,1993. Therefore, the earlier demand was required to be modified, consistent with the escalation in the cost of the value of the land as a result of determination of the compensation by the Civil Court"...... The allottee is to bear the burden of not only the escalation in construction costs but also of the escalation of the value of the land when the Court enhanced the compensation under provisions of the Land Acquisition Act at various stages. Otherwise, who would pay the escalation cost value of the land etc."

In the light of this, we are of the firm opinion that the enhanced price demanded on account of land acquisition charges for an amount of Rs. 41,146/- is, therefore, not in violation of the order of this Commission.

THE learned Counsel for the petitioner has relied upon the case Indore Development Authority v. Sadhana Agarwal & Others, (1995) 3 SCC 1. This case does not relate to the enhanced price on account of the award of the Court in land acquisition proceedings and is distinguishable. In view of the foregoing, we direct the Authority not to charge interest of Rs. 18,098/- mentioned at Serial No. 3 of letter dated 26.9.92, Annexure A-2, on the revised cost. The liability of the petitioner to pay the balance amount, if any, stands consequently reduced. If it is found that the whole amount has been paid by the petitioner and no balance is outstanding against him, the Authority is directed to refund the aforementioned amount of interest to the petitioner within 15 days. If the amount is not paid as directed, the petitioner shall be entitled to further interest 18% per annum from the date of the order till actual payment.

NEXT question that arises for consideration is whether the respondent-Contemner has committed any contempt and is punishable under Section 27 of the Consumer Protection Act. We have given due consideration to this aspect of the matter and are of the opinion that the respondent-Authority has only mis-interpreted the order by charging interest as aforementioned but has acted bona fide and, therefore, no contempt is made out and consequently they are not liable to any punishment. The petition stands disposed of accordingly. Petition disposed of.