Aruna Luthra v. State Of Haryana And Ors

1. In an auction held on 30.10.1980 the petitioner purchased S.C.F. No. 33, Sector 7 in Faridabad and an allotment letter was issued to her on 5.12.1980. The price of the building was Rs. 2,83,100/- and 25% of this amount including the amount deposited at the time of auction was to be paid within 30 days from the date of issue of the letter and the balance amount was payable in half-yearly instalments. Each instalment was to be paid together with interest on the balance price @ 10% on the remaining amount. Interest was, however, to accrue from the date of offer of possession. According to Clause (22) of the allotment letter all disputes and differences between the parties arising out of or relating to the allotment were to be referred to the sole arbitration of the Chief Administrator, Haryana Urban Development Authority {for short HUDA) or any other officer appointed by him. After purchasing the building the petitioner wrote to the Estate Officer, HUDA, Faridabad to hand over vacant possession of the same. It appears that the building was occupied by some unauthorized occupants and, therefore, its possession could not be delivered to the petitioner. It was only on 4.5.1987 that the possession was delivered to her. At the time of delivering possession to the petitioner it was found that the building had been damaged and there were breakages. A statement about the details of damages and breakages as found in the building was prepared. The petitioner continued representing to the respondents that the damage caused to the building by the unauthorized occupants be repaired so that the same becomes habitable. It was also represented by the petitioner that interest on the balance amount payable to the respondents should be charged only from the date when the defects in the building were removed. Since the respondents did not pay any heed to the representations of the petitioner, she invoked the arbitration clause and filed a petition Under Section 20 of the Arbitration Act in the Court of Senior Sub Judge, Faridabad. This application was allowed on 26.7.1989 and the Chief Administrator was appointed the arbitrator to settle the disputes between the parties and he was directed to pronounce his award within four months. The parties were also directed to file their claims and counter-claims before him within the time schedule fixed by the Court. The Administrator exercising the powers of the Chief Administrator decided the matter as per his order dated 21.5.1990 and directed the Revenue Officer, Faridabad to get the deficiencies removed which had been found at the time of delivering possession to the petitioner. In addition, the petitioner was directed to pay interest on the balance instalments from the date of delivery of possession. It is stated that the deficiencies have not been removed so far and the premises are lying unused. The petitioner applied to the respondents for transfer of the building in the name of one Surinder Nischal and in response to her application she was informed that a sum of Rs. 14,77,660/- was payable by her to HUDA. It is submitted that the petitioner then verified from the office of the respondents as to how this amount was due. She also submitted the details of the payments made by her. A copy of the letter dated 24.4.1996 addressed to the Estate Officer in this regard is Atmexure P- 12 with the petition. A perusal of the payment schedule as contained in this letter would show that the petitioner delayed the payment of instalments for which she is liable to pay interest. The petitioner also requested that a conveyance deed be executed in her favour. It was then that the present petition was filed under Article 226 of the Constitution for quashing the demand made by the respondents requiring the petitioner to deposit a sum of Rs. 14,77,660/-. It is also prayed that the respondents be directed to execute the conveyance deed in favour of the petitioner.

2. In the written statement filed on behalf of the respondents, it is pleaded that an amount of Rs. 14,77,660/- is due from the petitioner and that interest @ 18% per annum has been charged as per HUDA policy. It is admitted that a sum of Rs. 2,30,490/- was deposited by the petitioner on 19.4.1996. It is denied that the petitioner is entitled to any damages as claimed.

3. We have heard counsel for the parties and from their pleadings it is clear that the possession of the S.C.F. was delivered to the petitioner on 4.5.1987. As per the decision of the Administrator, HUDA dated 21.5.1990 the petitioner is liable to pay interest only from the date of delivery of possession. This is also in accordance with Clause (6) of the allotment letter. Even according to Regulation 5 (7) of the Haryana Urban Development (Disposal of Land and Buildings) Regulations, 1978, interest on delayed payments has to accrue only from the date of offer of possession of the building. The question that, however, arises for consideration is at what rate is the interest payable. According to the respondents, HUDA had prepared some policy on the basis of which interest is being charged @ 18%. On the other hand, the learned counsel for the petitioner strenuously urged that in terms of Clause (6) of the allotment letter, the instalments were recoverable together with interest on the balance price @ 10%.

4. Having given our thoughtful consideration to the rival contentions of the parties, we are of the opinion that the petitioner is liable to pay interest at the agreed rate of 10% as stipulated in the letter of allotment. Allotment of S.C.F. through an open auction was the result of a contract between the parties whereby it was agreed between them that the unpaid instalments would be recoverable together with interest at the rate of 10% on the balance price. Clause (6) of the allotment letter contains this stipulation. In the light of this clause, it is not open to HUDA to claim and charge interest @ 18% as is being done in the instant case. All that is stated in para 14 of written statement is that the petitioner is liable to pay interest @ 18% per annum as per HUDA policy. What is that policy, under which provision of law has it been framed and whether it can override the contractual stipulation contained in Clause (6) of the allotment letter has not been spelt out in the written statement. No provision of any law or the aforesaid regulations has been brought to our notice whereby HUDA could charge interest at a rate exceeding the agreed rate of interest.

5. In the result, it has to be held that the petitioner is liable to pay interest @ 10% as agreed between the parties and that too w.e.f. 4.5.1987 on which date the possession of the premises was delivered to her. Consequently, the communication dated 11.4.1996 (Annexure PI-1 with the writ petition) insofar it requires the petitioner to deposit a sum of Rs. 14,77,660/- is quashed and respondents 2 to 4 are directed to work out afresh the total amount, if any, payable by the petitioner together with interest @ 10% per annum w.e.f. 4.5.1987 and intimate the same to the petitioner who shall have to pay the same. The amounts deposited by the petitioner will, of course, be taken into account and she shall be given credit for the same. If the amount as worked out is deposited by the petitioner, the respondents shall execute the deed of conveyance in her favour in accordance with law.

6. Another grievance of the petitioner is that in spite of a direction given by the Administrator on 21.5.1990 the damage caused to the premises by the unauthorized occupants which was subsisting at the time of delivery of possession has not been repaired so far and the premises are lying unused as they are not capable of being inhabited. This averment of the petitioner has not been specifically denied in the written statement. We, therefore, direct that the petitioner should serve one last notice on the respondents pointing out all the deficiencies and damage in the building requiring them to repair the same. If such notice is received, respondents 2 to 4 may have the premises inspected through their staff and cause the repairs to be made within three months from the date of receipt of the notice failing which it will be open to the petitioner to have the premises repaired on her own at the cost of these respondents. This direction has become necessary because we find that the Administrator, HUDA itself while giving its decision on the disputed issues between the parties had given a direction to the Revenue Officer to get the deficiencies removed and damage repaired which were found at the time of delivery of possession of the premises.

7. The writ petition stands allowed in the above terms. No costs.