KEWAL KRISHAN PURI vs HOUSING BOARD HARYANA

THE complainant/petitioner was allotted a MIG house no. 2148, Ground Floor, in Housing Board Colony, Sector -6, Karnal for a total sum of Rs. 1,47,781.30/ -, comprising Rs. 1,44,900/ - towards cost of litigation and Rs. 2881.30/ - towards the cost of the land. The complainant made a lump sum payment of Rs. 12,550/ - alongwith the application and the balance amount was payable by him in instalment of Rs. 1,830/ - per month spread over eight years. The complainant paid some instalments in time, but thereafter he did not pay the said instalments on a regular basis. As a result, the respondents/opposite parties charged interest from the petitioner/complainant. The grievance of the petitioner/complainant is that the respondents/opposite parties charged compound interest from him though there was no agreement between the parties for charging compound interest. This is also the case of the petitioner/complainant that in terms of the decision of Punjab and Haryana High Court in Civil Writ Petition No. 7706 of 2007, Ram Prakash Sharma and Ors. Vs. State of Haryana and Ors., decided on 30.09.2008, the respondent was not entitled to charge compound interest. Being aggrieved from the act of the opposite parties in charging the compound interest, the complainant/petitioner approached the concerned District Forum by way of a complaint. The complaint was opposed by the opposite parties primarily on the ground that they were charging compound interest upto 31.12.2002 as per their policy and the decision of Punjab and Haryana High Court in Ram Prakash Sharma was not applicable to the petitioner, who was seeking refund after execution of the conveyance deed in his favour.

VIDE its order dated 22.08.2008, the District Forum allowed the complaint and directed the respondents to overhaul the accounts of the complainant by calculating simple interest at the agreed rate as per the allotment letter and refund the balance amount charged from him alongwith interest at the rate of 10% per annum.

BEING aggrieved from the order of the District Forum, the opposite party approached the concerned State Commission by way of an appeal. Vide impugned order dated 23.02.2010, the State Commission allowed the appeal, set aside the order passed by the District Forum and dismissed the complaint. Being aggrieved, the complainant is before us by way of this revision petition. It is in not dispute that the petitioner/complainant had committed default in payment of monthly instalments to the opposite parties/respondents. It is also not in dispute that the petitioner/complainant was under an obligation to pay interest for the period the payment of instalment was delayed. The only dispute between the parties is as to whether the petitioner/complainant is required to pay simple interest or he is required to pay compound interest.

ADMITTEDLY , there is no agreement between the parties envisaging payment of compound interest in the event of default or delay in payment of the hire purchase instalments. In our view, in the absence of such an agreement, the respondents/opposite parties were not entitled to charge compound interest though they could have charged simple interest from the petitioner/complainant. As regards the policy of the opposite parties/respondents, there is no material on record to show that the aforesaid policy was, at any point of time, conveyed to the petitioner/complainant. Mr. Paul states that there is a reference to the rules and regulations of the board in the allotment letter. However no rules or regulations, requiring the allotees to pay compound interest in the event of default in payment of hire purchase instalments has been brought to our notice. An administrative policy decision taken by the opposite parties does not have the force of a statutory rule or regulation and in the absence of any agreement between the parties, the policy requiring the allotees to pay compound interest will not bind him. This is more so when there is no material on record to show that the policy was brought to the notice of the allotee. It is quite possible that had the complainant known that in the event of default he would have to pay compound interest, he would have arranged money, from one source or the other, instead of choosing to pay compound interest to the opposite parties.

IN fact, Punjab and Haryana High Court has clearly held in Ram Prakash Sharma that the opposite party was not entitled to charge compound interest, thought the said High Court also held that if any of the petitioner has already deposited interest in terms of the demand raised by Estate Manager, Haryana Housing Board, Faridabad, he would not be entitled to seek refund under the order passed by it. The effect of the aforesaid order of the High Court is that those who had approached the High Court by way of a writ petition, but had already paid interest were not allowed to seek refund from Haryana Housing Board, whereas those, who had not made payment of the compound interest were not required to pay the same. However, if a consumer is able to show that the service provider has charged from him interest beyond the agreement between the parties that would be a case of deficiency in rendering services to the consumer and in such a case, a Consumer Forum would be entitled to grant appropriate relief to the consumer. This would be done by the Consumer Forum on account of the deficiency in the services rendered to the consumer and not on the strength of the order passed by the High Court in a writ petition.

FOR the reasons stated hereinabove, we are of the considered view that the respondents could not have charged compound interest from the petitioner/complainant, though it could have charged simple interest at the rate at which interest was actually calculated by it. We, therefore, allow the revision petition as well as the complaint by directing the opposite parties to recalculate the interest liability of the petitioner/complainant, by charging simple interest as against compound interest charged upto 31.12.2002. The amount which becomes payable to the complainant in terms of this order shall be paid to him within six weeks from today, alongwith interest on that amount at the rate of 9% per annum.