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Haryana Urban Development Authority v. Soma Devi .
Factual and Procedural Background
The respondent was allotted Plot No. 93 in Sector 15, Jagadhri on 23 August 1991. Although substantial payments were made, possession was withheld because the plot was under litigation. The respondent therefore filed a consumer complaint seeking refund of all monies paid.
The District Consumer Forum ordered: (i) refund of the deposits with interest at 18% per annum from each date of deposit, (ii) Rs 5,000 as compensation for harassment and mental agony, and (iii) Rs 2,000 as litigation costs. The State Commission dismissed the appeal but reduced the interest rate to 12% per annum. In revision, the National Commission reinstated 18% interest, relying on its earlier ruling in Haryana Urban Development Authority v. Darsh Kumar.
On 1 September 2004 the Supreme Court, under the mistaken impression that possession had also been directed below, ordered delivery of the plot. The appellant authority complied. Subsequent scrutiny revealed that the operative orders were confined to refund only. By then the appellants had already paid the respondent Rs 4,97,736 (1 July 2004) and Rs 3,000 (26 July 2004) towards the refund and interest.
Legal Issues Presented
- Whether an allottee who elected and obtained a monetary refund with interest can subsequently claim possession of the allotted plot.
- Whether, in the circumstances of this case, the refund already made with 18% interest requires any further adjustment under the principles laid down in Ghaziabad Development Authority v. Balbir Singh.
Arguments of the Parties
Respondent’s Arguments
- Offered to return the amounts refunded (Rs 4,97,736 and Rs 3,000) and to pay the current market value of the plot in order to retain possession.
- Contended that the neighbouring allottee had received possession and thus the respondent should be treated similarly.
Appellants’ Arguments
- The respondent specifically sought and has already received a refund with interest and therefore has no surviving right to possession.
- The comparison with the neighbouring allottee is unfounded; that allottee may have awaited possession without seeking refund, making the cases incomparable.
Table of Precedents Cited
| Precedent | Rule or Principle Cited For | Application by the Court |
|---|---|---|
| Ghaziabad Development Authority v. Balbir Singh (2004) 5 SCC 65 | Interest at 18% is not automatic; compensation must correlate with proven loss or injury; Forums must find deficiency in service/misfeasance before awarding such interest. | Confirmed that although 18% interest has been paid in this case, the appellants cannot now seek its refund; the principles guide the Court’s overall assessment of consumer compensation. |
| Haryana Urban Development Authority v. Darsh Kumar, RP No. 1197 of 1998 (National Commission, 31-8-2001) | National Commission precedent granting 18% interest in similar allotment matters. | Relied upon by the National Commission below to award 18% interest; the Supreme Court noted this reliance when examining the procedural history. |
Court's Reasoning and Analysis
The Supreme Court found merit in the appellants’ contention that the respondent, having expressly chosen a monetary remedy and received the full refund with interest, forfeited any subsequent right to physical possession of the plot. The possession obtained pursuant to the Court’s interim order was secured without full disclosure of the true procedural posture; consequently, retention of the plot would amount to unjust enrichment.
The Court directed immediate return of possession to the appellant authority, authorising it to recover possession if the respondent failed to comply voluntarily. It clarified that should the respondent desire a plot in future, a fresh application under a prevailing scheme may be made and would be considered on its own merits.
Finally, consistent with Balbir Singh, the Court held that, because the refund had already been effected with 18% interest, no claw-back of that interest could now be demanded by the appellants.
Holding and Implications
APPEAL DISPOSED OF.
The respondent must forthwith surrender the plot to the Haryana Urban Development Authority; failing which, the authority may repossess it. No further relief, refund, or costs were granted.
Implications: The judgment reinforces that an allottee who opts for and accepts a monetary refund cannot later insist on possession of the underlying property. It also underscores the duty of candour toward the Court and affirms that interest awards must align with the principles articulated in Balbir Singh, though no new precedent was created beyond applying those established guidelines to the facts at hand.
S.N Variava, J.— Before this Court, a large number of appeals have been filed by the Haryana Urban Development Authority and/or the Ghaziabad Development Authority challenging orders of the National Consumer Disputes Redressal Commission, granting to the complainants, interest at the rate of 18% per annum irrespective of the facts of each case. This Court has, in the case of Ghaziabad Development Authority v. Balbir Singh (2004) 5 SCC 65 deprecated this practice. This Court has held that interest at the rate of 18% cannot be granted in all cases irrespective of the facts of the case. This Court has held that the Consumer Forum could grant damages/compensation for mental agony/harassment where it finds misfeasance in public office. This Court has held that such compensation is a recompense for the loss or injury and it necessarily has to be based on a finding of loss or injury and must correlate with the amount of loss or injury. This Court has held that the Forum or the Commission thus had to determine that there was deficiency in service and/or misfeasance in public office and that it has resulted in loss or injury. This Court has also laid down certain other guidelines which the Forum or the Commission has to follow in future cases.
2. This Court is now taking up the cases before it for disposal as per principles set out in the earlier judgment. On taking the cases we find that the copies of the claim/petitions made by the respondent complainant and the evidence, if any, led before the District Forum are not in the paper-book. This Court has before it the order of the District Forum. The facts are thus taken from that order.
3. In this case, the respondent was allotted a plot bearing No. 93, Sector 15, Jagadhri on 23-8-1991. The respondent paid substantial amounts but the possession was not delivered as the plot was under litigation. Thus, the respondent filed a complaint claiming refund of amounts paid. On these facts, the District Forum directed refund with interest on amounts deposited @ 18% p.a from each date of deposit till its actual payment. It further directed to pay Rs 5000 as compensation on account of harassment and mental agony and awarded Rs 2000 as cost of litigation.
4. The State Forum dismissed the appeal and modified the order of the District Forum by reducing the interest from 18% p.a to 12% p.a The appellants went in revision before the National Commission. The National Commission dismissed the revision filed by the appellants relying upon its own decision in the case of Haryana Urban Development Authority v. Darsh Kumar RP No. 1197 of 1998 dated 31-8-2001 (NC) and observing that interest @ 18% p.a has been allowed by them under similar circumstances.
5. When this matter reached hearing on 1-9-2004, counsel for the respondent, without pointing out that in this case the only order was directing refund of monies paid, showed to the Court correspondence wherein the respondent had asked for possession of plot and some officer of the appellants had offered possession on certain terms. We had thus presumed, on that date, that this was also a matter where the appellants had been directed to deliver possession. Thus by order dated 1-9-2004, we had directed that possession be given to the respondent.
6. We are informed that the appellants have in obedience of our order given possession. However, now, on looking into the matter, we find that the only orders are for refund of monies with interest.
7. It is not denied that the appellants have on 1-7-2004 paid to the respondent a sum of Rs 4,97,736. They have also, on 26-7-2004, paid another sum of Rs 3000 to the respondent. The appellants have thus complied with the orders directing refund of amounts deposited with interest thereon.
8. On behalf of the respondent it was submitted that the respondent is willing to return the sums of Rs 4,97,736 and Rs 3000 to the appellants and is also willing to pay the market value, as on date, of the plot of which possession is delivered to him. It is submitted that the person who had been allotted the neighbouring plot has also been given possession of his plot and thus the respondent is also entitled to possession of the plot.
9. On behalf of the appellants it is submitted that the respondent had asked for a refund of monies deposited by him and thus his monies have been refunded with interest. It is submitted that the respondent is thus not entitled to possession of any plot. It is submitted that for the first time oral submissions are being made about the allottee of the neighbouring plot. It is submitted that it is possible that the allottee of the neighbouring plot may have waited for possession and not asked for a refund and thus that case may not be a comparable case.
10. We see substance in submission on behalf of the appellants. The respondent having claimed a refund and having received the amounts can now have no right to possession. The possession obtained under orders of this Court was without disclosing proper facts to this Court. The respondent cannot be allowed to retain possession. We therefore direct that the respondent forthwith return the possession to the appellants. If the respondent does not return possession, the appellants will be at liberty to take back possession. If the respondent wants a plot, she may apply afresh under any of the schemes of the appellants. Such application, if made, will undoubtedly be dealt with on merits in accordance with normal policy.
11. As refund has been made with interest at the rate of 18%, on principles laid down by us in the case of Ghaziabad Development Authority v. Balbir Singh (2004) 5 SCC 65 no refund can now be claimed by the appellants.
12. Thus, this appeal stands disposed of with no further or other orders. No order as to costs.
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