LUCKNOW DEVELOPMENT AUTHORITY vs PRABHAT RASTOGI

THIS is an appeal against the judgment and order dated 23.7.1997 passed by District Consumer Forum-I, Lucknow in Complaint Case No. 383/94.

ACCORDING to the complainant, the facts of the case stated in brief are that the complainant deposited a sum of Rs. 20,000/- on 1.10.1990 as registration money for Duplex M.I.G. House in Viram Khand of Gomtinagar Scheme. Thereafter the allotment money of Rs. 20,000/- was deposited on 26.2.1991. By letter dated 20.9.1991 the house was allotted to him. The estimated cost of the house was Rs. 2,95,000/-. The complainant was asked to deposit the rest of the amount in two instalments of Rs. 1,27,000/- each payable on 19.10.1991 and 26.12.1991. The two instalments were deposited by the complainant. The possession of delivery of the house was assured to be given within a reasonable time of six months from 20.9.1991. In this way, the possession was to be delivered till the end of March, 1992 but the possession of the house was not delivered to the complainant. The complainant wrote a letter to the Lucknow Development Authority. In response to their letter, by letter dated 14.1.1994, the Lucknow Development Authority intimated that the price of the house after final calculation comes to Rs. 3,76,800/-. It demanded that the excess amount of Rs. 81,800/- should be paid in two instalments of Rs. 40,900/- on 28.2.1994 and 31.5.1994. It was also pointed out that if this amount is not deposited then the interest at the rate of 21% shall be charged. The complainant also made a demand against the Lucknow Development Authority that a sum of Rs. 1,44,815/- as interest at the rate of 21% per annum on the deposits and prayed for adjustment of Rs. 81,800/- out of this amount. No response came from the side of the opposite party. Thereafter, the complainant deposited the amount demanded by the opposite party alongwith penal interest at the rate of 21% per annum. Thereafter, the complainant has made several requests for handing over of the possession of the house but it was not done, hence the complainant filed a complaint for ordering the Lucknow Development Authority for delivering the possession of the house and for damages, interest and compensation. The opposite party did not file any written version inspite of personal service on 29.11.1995 as has been mentioned in the judgment, hence the case has proceeded ex-parte.

The learned District Forum after considering the case of the parties, came to the conclusion that there was deficiency in service on behalf of the opposite party in not delivering the possession of the house within the time bound period, hence it directed the Lucknow Development Authority to handover the possession of the completed house within a period of 60 days from the date of judgment and also allowed 16% per annum interest on deposited amount of Rs. 2,95,000/- with effect from 1.4.1992 till the date of actual possession. It also awarded interest at the rate of 21% per annum on Rs. 81,800/- with effect from 14.6.1994 till the date of actual possession and also interest at the rate of 21% per annum on the amount of Rs. 68,330/- with effect from 24.7.1995 till the date of delivery of possession. It also allowed Rs. 200/- as cost.

AGGRIEVED against the order of the learned District Forum, the appellant has come in appeal and has challenged the correctness of the order passed by the learned District Forum. We have heard the learned Counsels for the parties. At the time of argument, it has been disclosed that the possession of the house has been delivered on 12.3.1999 but the registration of the property had not been done so far. In the present case, the learned Counsel for the appellant has argued that the interest awarded by the learned District Forum at the rate of 21% per annum which is too much on the higher side. We are not inclined to accept this argument in view of the facts disclosed by on the file.

THE learned Counsel for the appellant has argued that the penal interest was to be charged by Lucknow Development Authority at the rate of 16% per annum if the amount is not deposited by the allottees within the time after the allotment was made. THE learned Counsel for the appellant has further argued that whenever the cost of the house was enhanced, it was communicated that if the amount is not deposited the interest at the rate of 21% will be charged. According to the learned Counsel for the respondent when the interest at the rate of 16% and 21% per annum are being charged by the Lucknow Development Authority, therefore, on the principle of equity, it is also bound to pay the same amount of interest. THE copies of both these schedule of payment letters have been filed before us. THE initial letter of Allotment-cum-Schedule of Payment dated 20.9.1991 goes to show that if any of the instalments are not paid within the due date, the penal interest at the rate of 16% per annum on the payable amount will be charged. Similarly, by another letter dated 3.12.1994 it was intimated that if the amount of enhanced cost is not deposited as per the schedule, the interest at the rate of 21% per annum shall be charged and if it is not paid within three months, then the allotment will be cancelled. Thus, we find that the Lucknow Development Authority charges penal interest on late deposit of the amount at the rate of 16% and 21% per annum. According to the learned Counsel the interest should have been awarded at the rate of 12% per annum as has been held by the Hon''ble Supreme Court in the case of Surendra Kaur v. Government of Punjab & Ors., 1998 (9) Supreme Court Cases 592. In this case, the question which was raised before the Hon''ble Supreme Court was whether it was justified in directing the appellant to pay 7% regular interest for default payment of instalments of purchase price together with 18% penal interest. THE Hon''ble Supreme Court held that the penal interest as well as normal interest charged by the Authority for late payment could not have exceeded from 18%. THE Regional Authority in that case has held that the regular interest at the rate of 7% and the penal interest at the rate of 18% was confirmed. We are here concerned whether the penal interest which has been charged by the Lucknow Development Authority at the rate of 16% and 21% should also be applied against the Lucknow Development Authority for not delivering the possession of the house in dispute to the complainant within the stipulated period. THE possession of the house was delayed for many years without any justification. THErefore, the facts of the case relied upon by the learned Counsel for the appellant are entirely different from the facts of the present case, as it has been demonstrated in this case that Development Authority has charged penal interest from the complainant at the rate of 21% per annum on the escalated amount of the cost. THErefore, in terms of the brochure when the Lucknow Development Authority has been authorised to charge penal interest at the particular rate then it shall also be bound to pay the interest at the same rate at which they charge. THErefore, the learned District Forum was perfectly justified in allowing 16% per annum interest on the original amount deposited by the complainant and 21% interest on the amount which was deposited later-on by the complainant on which the penal interest were also charged at the rate of 21% per annum by the Lucknow Development Authority. Thus, we find that this appeal has no force and is liable to be dismissed. Order The appeal is dismissed. The judgment and order of the learned District Forum are confirmed and compliance of this order be made within a period of two months from the date of this order. The registration of the property shall also be got done within a period of one month after the Lucknow Development Authority intimates to the complainant, the formalities which are to be completed. This should be done within a period of one month from the date of this order. When the same is intimated to the complainant, he shall complete the formalities within next 20 days and thereafter the Lucknow Development Authority shall execute the order within the next 10 days. The appellant shall pay Rs. 2,000/- as cost of this appeal. Let copy be made available to the parties as per rules. Appeal dismissed.