HOUSING BOARD HARYANA vs Chander Hass Kaushik

THE Housing Board Haryana, Petitioner herein has filed the present revision petition against the order of the State Consumer Disputes Redressal Commission, Chandigarh (hereinafter referred to as the State Commission) in favour of Chander Hass Kaushik (hereinafter referred to as the Respondent).

THE facts of the case according to the Respondent who was the original complainant before the District Forum are that on 07.03.1993 the Respondent had applied for purchase of a house to the Petitioner in Housing Board Colony, Sector-7, Kurukshetra and deposited Rs.20,500/- vide demand draft with the Petitioner/Board. THE tentative price of the house was quoted as Rs.2,08,000/-. Respondent was subsequently allotted an MIG IIB House in Sector-7, Kurukshetra on freehold basis. Respondent deposited Rs.49,100/- as stipulated within 30 days of the allotment. THE possession of the house was to be delivered after execution of agreement for sale. THE remaining 70% of the total price was to be deposited in 16 half-yearly equated instalments of Rs.16,479/-. Respondent was delivered possession of the house on 05.10.1993 and he found that the quality of construction was very poor and, therefore, he spent another Rs.20,000/- on upgrading the construction. He also deposited a total of Rs.1,15,784/- including Rs.20,000/-. THErefore, he spent a total amount of Rs.1,35,784/- on the house. However, in view of the very poor quality of construction, Respondent decided to surrender the house and requested the Petitioner to take back the possession and refund the total amount paid by him as well as the money spent on repairs. Petitioner agreed to refund the entire amount and Respondent, therefore, handed over the possession of the house. However, to the utter surprise of the Respondent, Petitioner returned only Rs.28,738/- on 28.07.1996. Respondent, therefore, filed a complaint before the District Forum on grounds of deficiency in service and requested that the Petitioner should refund the full amount with interest @ 24% and in case the Petitioner is not willing to do so, the house in question be re-allotted to the Respondent on the same terms and conditions. Petitioner refuted the contentions regarding the poor quality of construction of the house and stated that the Respondent took possession of it after due inspection and it is not correct that he spent Rs.20,000/- on its repairs. Further, as per the Petitioners surrender policy, Rs.28,738/- was refunded to the Respondent as admissible after making the following deductions from Rs.1,15,784/- paid by the Respondent: (i) 10% of the total sale price of the house i.e. Rs.20,800/- (ii) Interest component on the half yearly equated payment of. Rs.62,184/- (iii) Penalty imposed due to non-payment of half yearly instalments in time i.e. Rs.3,942/-. (iv) Insurance charges @ Rs.120/-.

Petitioner further stated that the Respondent is not entitled to re-allotment of the said house as he has already surrendered the possession. The District Forum after hearing both parties partly accepted the complaint. The relevant part of the order of the order of the District Forum is as follows: I am of the considered view that neither the complainant is entitled to have the interest on the deposited amount nor the OP is entitled to charge the interest at the rate of 16% per annum which is inclusive in the amount of half yearly instalment for the overdue amount of the instalments because there is no such policy of the surrender in the allotment letter nor there is any mention in it of the adoption of the policy of the HUDA and in the absence of any specific contract between the parties. Neither of the party can be allowed to interpret the terms and conditions of the allotment letter to their advantage. Even it the policy of HUDA is adopted in case of surrender of the plot etc. then also to my mind the complainant is entitled to have the refund of the money after deduction of 10%The complaint is liable to be accepted partly to the extent that the complainant is entitled to the refund of the deposit amount after the deduction of 10% with interest at the rate of 12% per annum from the date of surrender of the plot on dated 09.08.1996 till realization which the opposite parties had failed to refund illegally and malafidely which amounts to deficiency in service. The District Forum directed the Petitioner to pay Rs.75,468/- along with interest @ 12% per annum with effect from 09.08.1996 i.e. the date of surrender of the house within a period of one month of passing of this order.

AGGRIEVED by this order, Petitioner filed a complaint before the State Commission which dismissed the same on the grounds that the Petitioner was not entitled to charge interest doubly on the installments as well as on the whole amount because the installments which Respondent paid actually contained an interest component @ 16% per annum. At best, Petitioner could have deducted the penalty amount. The State Commission also observed that deduction of 10% amount of the total sale price was also illegal as there is no such provision in the rules and regulations of the Petitioner/Board. The relevant part of the order of the State Commission reads as follows: Counsel for appellants contended that Agenda Item 90.15 was approved by the Housing Board Haryana on the pattern of HUDA and according to that resolution, appellants were entitled to deduct 10% of the whole amount for giving refund. However, a perusal of the letter No.7268.80 dated 10.6.85 shows that it was with respect to surrender of commercial sites/plots and not residential plots/buildings. Thus, Housing Board, Haryana was not competent to deduct 10% of the amount as surrender charges. The installment which Chander Hass was to pay also contained interest @ 16% p.a. The appellants were not entitled to charge interest doubly i.e. on the installments as well as otherwise also. At best they could charge only penalty amount as per allotment letter bearing No.6326 dated 05.10.93. It was not to exceed 25% of the amount due. It is clearly mentioned in the allotment letter that 70% amount of the total sale price shall be paid either in lumpsum or in 16 half yearly equal installments with interest @ 16% p.a. i.e. Rs.16,479/- in all. Thus, the amount of Rs.16,479/- also included interest @ 16% p.a. However, appellants has charged double interest i.e. on the amount of installment which included interest and further charged interest @ 16% p.a. which was illegal. Thus, interest amount charged of Rs.62,184/- is illegal and further deduction of amount of Rs.20,800/- being 10% of the total price is also illegal because there is no resolution to that effect. Hence, the present revision petition. After hearing both parties, the Commission issued notice in revision limited to the extent of charging of interest of Rs.62,184/- by the Petitioner from the Respondent. Learned counsel for Petitioner was present. None was present on behalf of the Respondent. Since A.D. cards were received in respect of the notices sent to both parties, the case was heard ex parte.

LEARNED counsel for Petitioner stated that the State Commission erred in concluding that the Petitioner had charged double interest i.e. on the amount of half yearly equated instalments which included interest @ 16% p.a. as also further interest @ 16% p.a. on the total amount of half yearly instalments. This is not factually correct. In fact the Petitioner while returning the refund only deducted the interest component of interest @ 16% in respect of half yearly equated installments and as agreed refunded the rest of the amount. This was in keeping with the policy of the Petitioner/Board and was also a fair deduction taking into account the fact that the Respondent had stayed in these premises for about 3 years and the interest portion for all practical purposes was deemed to be in lieu of the monthly rent for the same. The revision petition therefore deserves to be accepted. We have heard the learned counsel for Petitioner and considered the evidence on record. It is not in dispute that the Respondent had paid total amount of Rs.1,15,784/- following the allotment of the house by the Petitioner/Board and that he decided to surrender the house after living in it for about 3 years i.e. on 09.08.1996. It is also on record that the Petitioner had agreed to return the amount paid by the Respondent but this did not mean that the interest component would also be returned. In fact, it has to be kept in mind that the Respondent had lived in this house for about 3 years before deciding to surrender it and it is only fair and reasonable that he should pay the Petitioner/Board rent for living in the premises. This itself justified deduction of interest component @ 16% p.a. by the Petitioner/Board to be adjusted as monthly rent from the Respondent for his having occupied the house for about 3 years. We do not find that the Petitioner has deducted interest twice as contended by the State Commission. Rs.62,184/- was the interest component of Rs.1,15,784/- including 4 half yearly installments paid by the Respondent as well as two additional installments which he had not fully paid on the date of surrender of the house. We, therefore, cannot agree with the reasoning and conclusion of the fora below that the Petitioner/Board wrongly deducted Rs.62,184/- while refunding the amount to the Respondent and, therefore, set aside these orders. The revision petition stands disposed of accordingly with no order as to costs.