B.K.AGGARWAL vs HARYANA OFFICERS AND PUBLIC ENTERPRISES EMPLOYEES WELFARE COOPERATIVE GROUP HOUSING SOCIETY

COMPLAINANT-Mr. B.K. Aggarwal has come up in appeal against the order dated Ist March, 1996 passed by the learned District Forum, Gurgaon, whereby his complaint has been partly allowed against the Haryana Officers and Public Enterprises Employees'' Welfare Cooperative Group Housing Society (hereinafter referred to as "the Society") by issuing the following directions : "Thus upto 19.11.94, the increased rate of interest cannot be charged from the complainant and it shall be 12% only. But in case any principal amount of old instalments is found outstanding against him, he can be asked to pay interest on that amount at an increased rate only from 19.11.94 till the date of payment. Old members cannot be allowed to linger on the payments at old rate of interest even after the date of decision regarding the increase in the rate of interest, when on the other hand, the new entrants are asked to pay the interest at the increased rate. In case the complainant had cleared his dues upto the date of the aforesaid meetings, he is nothing to lose. But in case any amount of old instalments payable by that date was outstanding, he is liable to pay the same @ 12% interest upto 12.11.94 and then @ 24% till the date of payment. But the interest @ 24% cannot be charged for the period prior to 19.11.94. Further, in case the increased interest has not been charged from other old members committing default beyond 19.11.94, then it cannot be charged from the complainant even, as no such discrimination can be permitted in such matter. So the calculation be made accordingly within a fortnight and the complainant be allowed to make the payment, if any amount is found due, within a reasonable period. The possession of the flat be delivered to the complainant immediately in order to avoid the loss of rent to him."

ACCORDING to the complainant, the Society was formed for providing housing accommodation to its members on ''no loss and no profit'' basis. vide its letter dated 15th June, 1994, the Society decided to enroll the appellant as its member and according to this letter, the new members were required to pay interest @ 12% per annum for the delay in making the payment of old instalments. The Society in its General Body''s meeting held on 19th November, 1994, at Gurgaon under the Chairmanship of Mr. R.S. Malik-respondent, further decided that interest @ 24% be charged on old instalments wherever any new applicant was to be enrolled as member in future. The appellant had already paid the entire principal amount and an additional amount of Rs. 75,000/over and above the old estimated cost of Rs. 8.50 lakhs as also the floor charges of Rs. 25,000/to the respondent-Society, which fact the Society in its letter dated 26th June, 1995, had also acknowledged by certifying that no amount towards principal was due from the appellant. Despite all this it still demanded an amount of Rs. 1,42,277/as penal interest @ 24% being outstanding against the appellant. Aggrieved against this unfair and unreasonable demand and the deficiency of service on the part of the Society, the complainant approached the District Consumer Forum, Gurgaon for the redressal of his grievance. Though the notice of the complaint was served on the Society, yet it had refused to accept the same and the District Consumer Forum had to proceed ex-parte. After examining the evidence produced by the complainant, the learned District Forum, partly allowed the complaint by granting the aforesaid relief. In the appeal before us, learned Counsel for the appellant has vehemently contended that as the Society was not entitled to demand interest @ more than 12%, its demand for @ 24% was wholly unfair and amounted to deficiency in service on the part of the Society. It is further contended, that the Society has therefore brought the figure to Rs. 1,42,703/by multiplying the interest from time to time even though the complainant had already paid the entire amount of principal as also of interest.

On the other hand Mr. R.S. Malik, President of the Society who appears in person on behalf of the respondent-Society, has vigorously pleaded, that since the appellant was admitted as a member to the Society at a later stage, he was liable to pay the interest demanded by the Society. To be exact, the defence of the Society as stated in para 8 of their written submissions, is reproduced as under : "That besides the appellant only one more member out of 201 members of the Society have made an issue not to pay the penal interest @ 24%, which has been paid by all other defaulting members in accordance with the policy decision of the Society. In fact, the Society had informed all the members vide letter dated 26.2.93 (copy enclosed an Annexure IV) that every member was liable to pay interest @ 2% per month i.e., 30% per annum on late payment of instalments and this penal interest was later on reduced to 24%. It is not possible for the Society to reduce the penal interest any further only to give special consideration to the appellant and one other member that is Shri Pardeep Kumar, IAS, who is also seeking intervention of the Hon''ble Commission in this regard. It is also not possible for Society to give possession of a flat without receiving full cost of the flat including penal interest on late payment because there is no way to recover any outstanding amount from a member after giving possession of the flat to him."

AFTER hearing the learned Counsel for the appellant and Mr. B.K. Aggarwal appellant in person and Mr. R.S. Malik, President of the Society-respondent and having gone through the record, we are of the considered view that the stand taken by the Society is wholly unfair and unreasonable, as the Society is not legally entitled to charge interest 24% on old instalments. Admittedly, the appellant has already remitted the amount of Rs. 71,140/being the interest amount claimed at the rate of 12% vide demand draft dated 5/6th july, 1995. His grievance, therefore, today is, against the, non-implementation of Society''s General Body Meeting''s resolution dated 19th November, 1994, in its true letter and spirit. Clause 5 whereof reads as under "Interest @ 24% may be charged on old instalments whenever any new applicant is enrolled as member in future."

It is evident from the facts and circumstances of the case, that the appellant is not a new member of the Society, hence the Society is bound by the decision of its own General Body meeting according to which old members are required to pay interest only @ 12% and not @ 24%. Further, the details of interest appended to the letter issued by the Society show, that the Society has added interest for the period Ist July, 1993 to 30th June, 1994 also, during which period the appellant was not even a member of the respondent-Society and was not liable to pay any interest for this period. Again, the Society could demand only simple interest and not compound for the period Ist January, 1994 to 1st July, 1995, at it had itself demanded simple interest from the appellant in its letter dated 26th June, 1995. Therefore, the learned District Forum should have directed the Society to comply with their own resolution dated 19th November, 1994 and charge the interest if any due, only @ 12% and that too simple and not compound.

CONSEQUENTLY, we are of the considered view that the respondent-Society is not entitled to charge from the appellant interest at the rate of more than 12% per annum which in fact the appellant has already paid and at present there was noting due against him. Hence, we accept the appeal, modify the order of the learned District Forum and allow the complaint in toto, by directing the respondent-Society to deliver possession of the flat in question to the appellant forthwith i.e., within a month. In the circumstances of the case, there shall be no order as to costs. Appeal accepted.