BIHAR STATE HOUSING BOARD vs RANJIT LAL BHAGAT

THIS appeal by Bihar State Housing Board is directed an order dated 28.10.1994 passed by the District Forum, Ranchi in Complaint Case No. 44 of 1994. By the impugned order, the District Forum directed the appellant Housing Board to refund the earnest money amounting to Rs. 15,000/- to the complainant (respondent in this appeal) with simple interest @ 10% per annum from date of deposit of the earnest money with the Housing Board till payment. The District Forum further directed the appellant Housing Board to pay Rs. 5,000/- as compensation to the complainant for the harassment and suffering caused to him due to deficiency in service on the part of Housing Board in the matter of allotment of house to the complainant.

THE case of the complainant (respondent in this appeal) was that on or about 15th February, 1985 Bihar State Housing Board (opposite party - appellant) published an advertisement in the local newspapers inviting applications for allotment on rental-cum-purchase basis of houses/flats under construction at different places in the State of Bihar including Argora at Ranchi for different category of applicants. As per the advertisement (Annexure I to the complaint petition) 120 units of Twin Houses for First Income Group were to be constructed at Argora, Ranchi. THE complainant, who was posted at Aurangabad in Bihar as District Judge and was due to retire within three years, was desirous of having an independent house at Ranchi and so he submitted an application in the prescribed form, (Annexure II to the complaint petition) in the office of the Housing Board on 9.3.1985. In view of his annual income he (complainant) came in the High Income Group as determined by the Housing Board and was eligible to priority in allotment for which 6% HIG Houses were kept reserved. Arbitrarily and against Rules he (complainant) was registered at Serial No. 24 in the general category of applicants. He vide his letter dated 31.12.1988 (Annexure-IV) protested and demanded his proper registration in the appropriate category and in response there to the opposite party vide letter No. 1989 dated 24.4.1990 informed him (complainant) to participate in the draw of lots of HIG Houses. In spite of his protest under his letter dated 31.12.1988 he found that his name had been registered in the general category at Serial No. 18. He again protested against the wrong registration and as assured by the opposite party that the mistake would be rectified before actual draw of lots on 8.5.1990. For certain reasons the scheduled draw of lots was not held on the said date. Subsequently the opposite party vide letter No. 2096 dated 2.12.1993 informed him (complainant) that the draw of lots was held on 28.5.1992 and he had not been allotted any house. This information given by the opposite party came as a surprise as there were more houses than applicants in the priority category of 6%. On further inquiry it transpired that the opposite party arbitrarily with ultarious motive and on extraneous consideration excluded the name of the complainant from priority category. In the meanwhile, the Housing Board made drastic changes in the advertised plan whereby the rental-cum-purchase scheme was changed into Self-financing Scheme. THE mode of payment was also changed and made onerous to the disadvantage of the original applicants. Apart from that the original tentative price fixed at Rs. 2.25 lakhs was, raised to Rs. 4,62,000.00. In the changed situation he (complainant) decided not to continue to be registered with the opposite party, Housing Board for allotment of houses and accordingly he requested the opposite party to refund the sum of Rs. 15,000/- deposited as advance by him alongwith his application together with interest @ 18% per annum from the date of deposit till payment. In spite of repeated requests, the opposite party did not refund the same and under the circumstances the complainant filed complaint case before the District Forum at Ranchi for refund of the aforesaid amount of Rs. 15,000/- with interest @ 18% p.a. from the date of deposit till realisation. THE complainant further prayed for compensation and cost. The opposite party appellant filed written statement before the District Forum and contested the case. In the written statement it was admitted by the opposite party appellant that the complainant was an applicant for allotment of house under HIG and had deposited Rs. 15,000/- as earnest money for the same. But, according to the opposite party the application of the complainant was for allotment of house under HIG Self-financing Scheme in retirement quota. It was further admitted in the written statement that the complainant was entitled to get benefit of reservation in retirement quota, but due to official mistake his name was put in general quota in the lottery held on 28.5.1992 and in the said lottery there were five houses reserved for retirement quota amongst seven applicants. According to the opposite party the complainant did not protest at the time of lottery for his reservation quota. However, his name is at Serial No. 2 in retirement quota for the subsequent lottery to be held in this regard. According to the opposite party, the complainant was not entitled to get interest as opposite party was not at fault. In the written statement of the opposite party the prayer was for dismissal of the complaint case with cost.

Now it has to be considered if the impugned order passed by the District Forum calls for any interference by this Commission or not?

CERTAIN facts are not disputed. It is not disputed that the complainant was an applicant for allotment of house under HIG and had deposited Rs. 15,000/- as earnest money for the same in the year 1985. It is also not disputed that the complainant was a District Judge at the time of applying for allotment of house and was entitled to get benefit of reservation in retirement quota. It is also not disputed that the name of the complainant instead of being put in retirement quota was put in general quota and under the circumstances he was not allotted any house in the lottery held on 28.5.1992. It is also not disputed that thereafter the complainant requested the opposite party appellant to refund the amount of Rs. 15,000/- deposited by him as earnest money together with interest @ 18% per annum from the date of deposit, but the said amount of earnest money has not been refunded as yet. The District Forum vide the impugned order has directed for refund of Rs. 15,000/- to the complainant with interest @ 10% p.a. Mrs. Neelu Agrawal, the learned Counsel appearing on behalf of the appellant Housing Board, fairly conceded that the complainant was entitled to refund of the aforesaid amount deposited by him, but he was entitled to interest @ 5% per annum only. In support of this contention Mrs. Agrawal referred to Regulation 45 of the Bihar State Housing Board (Management and Disposal of Housing Estates) Regulation, 1983 and pointed out that only simple interest @ 5% per annum is payable on the amount of earnest money deposited by the applicants after the date of enforcement of the regulation. In support of this contention she also referred to a decision dated 17.2.1997 of the Supreme Court in Civil Appeal Nos. 1666-67 of 1997, Bihar State Housing Board & Ors. v. Vijay Sharan & Ors. In the said decision it has been pointed out by the Apex Court that Regulation 45 of Bihar State Housing Regulations postulates that an applicant is entitled to interest @ 5% and hence the Court cannot give direction to pay interest contrary to the interest regulated by the statute under Regulation 45 of Bihar State Housing Board Regulation. On the other hand the learned Counsel appearing on behalf of respondent contended that Regulation 45 does not apply to cases of refund of earnest money where there is deficiency in service on the part of the Housing Board. There appears nothing in Regulation 45 to justify this contention of the learned Counsel for the respondent. The. learned Counsel for the respondent further contended that in spite of Regulation 45, this Commission has discretion to grant interest at a rate higher than 5%. In support of this contention the learned Counsel referred to a decision of the National Commission, reported in 1991 CPR Page 610, M.K. Gupta v. Lucknow Development Authority, and Another case reported in II (1998) CPJ 23 (NC), Dilbag Rai v. Housing Board, Haryana. In the case reported in 1991CPR Page 610 MIG House had been allotted to the complainant by the opposite party, Lucknow Development Authority against cash payment of Rs. 1,13,197/- by 29.7.1988 and the house had also been registered in the name of the allottee complainant on 18.8.1988, but possession over the house was not delivered to him because the construction work in the said house had not been completed due to internal managerial problems of Lucknow Development Authority. Under the circumstances the National Commission held that possession should have been transferred over the house complete in all respects immediately after the house was registered in the name of the complainant and since possession had not been transferred, the National Commission allowed interest @ 16% per annum to the complainant upto the date of handing over possession of the house. In the case reported in 1998 CPJ Vol. II page 23 (NC), the complainant had applied for allotment of HIG flat on 8.12.1986 and the allotment of flat was to be made within two years i.e. by 1988-89, but in fact allotment was made in August, 1990 long after the stipulated period of two years as per the terms of scheme of booking. The complainant took possession of the flat in October, 1990 and in the following rainy season of 1991 he found that rain water was percolating from the ceiling and the walls were developing cracks. The National Commission found that the house suffered from serious constructional defects and upheld the orders of the State Commission and District Forum, so far as they had allowed interest on the amount deposited by the complainant and remanded the case for determination of quantum of compensation for defects in the construction of flat. It may be pointed out that the rate of interest allowed by District Forum and State Commission is not mentioned in the decision of the National Commission.

IN the instant case before us neither allotment had been made nor full payment had been made nor there was any registration of the house in favour of the complainant. The complainant had simply paid Rs. 15,000/- as earnest money, so the facts of the said cases before the National Commission were quite different from the facts of the case before us. Apart from that, consideration of any provision like that of Regulation 45 of Bihar State Housing Board Regulations was not involved in the said cases before the National Commission. So the decisions of the National Commission in the said two cases are distinguishable and the same do not appear to be of any help to the learned Counsel for the respondent in support of her contention that this Commission has discretion to allow interest at the rate higher than that as mentioned in Regulation 45. IN view of this, the direction of the District Forum for payment of interest at the rate of 10% over the amount of earnest money is modified. Simple interest @ 5% only will be payable over the said amount of earnest money from the date of deposit of the earnest money till the date of payment thereof by the Housing Board to the complainant. The District Forum has directed for payment of Rs. 5,000/- as compensation to the complainant by the Housing Board for the mental agony, harassment and suffering caused to him due to deficiency in service on the part of the Housing Board in the matter of allotment of the house to the complainant. As pointed out earlier, it is not disputed that the complainant who was a District Judge, had applied for allotment of a house. It is also not disputed that the complaint had deposited Rs. 15,000/- as earnest money in the office of the Housing Board on 9.3.1985. It is also not disputed that the complainant was due to retire within three years and hence was eligible for priority to allotment of house. It is also not disputed that the complainant was entitled to get benefit of reservation of retirement quota, but due to official mistake on the part of the Housing Board his name was put in general category in the lottery held on 28.5.1992 and as a result of that house could not be allotted to him. The case of the complainant that he had protested under his letter dated 31.12.1988 and had demanded proper registration of his application in the appropriate category has not been denied in the written statement filed on behalf of the Board before the District Forum. Rather it has been admitted in the written statement of the Housing Board that due to official mistake on the part of the Housing Board the name of the complainant was put in general category in the lottery held on 28.5.1992. When all these facts are taken into consideration the deficiency in service on the part of the Housing Board becomes apparent. Due to such deficiency in service the complainant was practically deprived of allotment of house in reserved category. Under the circumstances, the direction of the District Forum for payment of Rs. 5,000/- as compensation by appellant Housing Board to the complainant does not call for any interference by this Commission. In view of the above discussions, this appeal by Housing Board is hereby dismissed with modification in the rate of interest allowed by the District Forum. The Board will pay the amount of earnest money to the complainant with simple interest @ 5% per annum as envisaged under Regulation 45 of Bihar State Housing Board Regulation. There will be no order as to cost. Appeal dismissed with modifications.