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Structured Summary of the Provided Legal Opinion

Factual and Procedural Background

The appellants are Chief Administrator, Punjab Urban Developers Authority (PUDA) and another, who filed this appeal against the State Consumer Disputes Redressal Commission, Punjab's order dated 15.10.2018 in CC No.533 of 2018. The respondent/complainant had booked a plot from the appellants but there was delay in delivery of possession because development works (including sewerage connection and acquisition of some revenue passages) were not complete. The respondent filed complaint CC No.533 of 2018 before the State Commission. The State Commission allowed the complaint by its order dated 15.10.2018 and directed:

i) Delivery of physical possession of the plot complete in all respects along with agreed facilities and Completion/Occupation Certificate;
ii) Payment of interest at 12% per annum on the entire amount deposited by the complainant (Rs.53,89,860/-) with effect from 01.04.2018 till delivery of possession; and
iii) Payment of Rs.55,000/- as compensation for mental agony, harassment and litigation expenses.

The appellants challenged that order by filing the present appeal (First Appeal No.1703 of 2019). There was delay in filing the appeal; the appellants sought condonation of delay, explaining procedural and inter-departmental reasons. The respondent (through her husband) opposed condonation and defended the State Commission's findings that the project was incomplete.

Legal Issues Presented

  1. Whether there was deficiency in service by the appellants (PUDA) due to incomplete development works justifying the State Commission's directions for delivery of possession, interest and compensation.
  2. Whether the rate of interest awarded by the State Commission (12% per annum) on the amounts deposited should be sustained or modified.
  3. Whether the delay in instituting the present appeal should be condoned and on what terms/costs, having regard to the reasons provided and applicable legal principles.

Arguments of the Parties

Appellants' Arguments

  • The appellants are a government organisation operating on a no-profit no-loss basis; delay occurred because the sewerage line work remained incomplete at the relevant time.
  • The development was not incomplete in a way that prevented delivery of possession: it was stated that sewerage would be completed when the complainant completed construction, and that the complainant was refusing to take possession on various pretexts.
  • There was no deficiency on the part of the appellants; hence no liability to pay interest on the deposited amount.
  • The compensation of Rs.55,000/- lacks justification; when interest is awarded on deposited amount, separate compensation is not required because interest itself is a form of compensation.
  • There was delay in filing the appeal (appellants stated 178 days) attributable to office processes, obtaining higher orders and inter-departmental consultations; the delay is not intentional or deliberate and should be condoned. Reliance was placed on the Supreme Court judgment in Hemlata Verma v. M/s. ICICI Prudential Life Insurance Co. Ltd. & Anr.

Respondent's (Complainant's) Arguments

  • The appeal should be dismissed for excessive delay: the respondent's side contended the delay was 320 days (contrasting with the appellants' claimed 178 days) and that the appellants supplied no pressing reason to justify condoning such delay.
  • The appellants themselves admitted incomplete development works (sewerage and revenue passages). The appellants' position that sewerage would be completed only after the complainant constructs a house shows deficiency in service; hence the State Commission's order awarding interest and compensation was justified.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
Hemlata Verma v. M/s. ICICI Prudential Life Insurance Co. Ltd. & Anr., Civil Appeal No.5131 of 2019 (decided 01.07.2019) Cited by appellants in support of condonation of delay. The appellants relied on this judgment to argue for condonation of delay; the court considered it among authorities on condonation principles when deciding to condone the delay (with costs).
Kolkata West International Pvt. Ltd. v. Deva Asis (Rudra, II (2019) CPJ 29 (SC)) Illustration of reduction of interest rate on refunds from 12% p.a. to 9% p.a. in refund cases. The court cited this case to observe that 12% p.a. is high and, since courts have awarded 9% in refund cases, there is no justification for 12% when possession is being granted; the court therefore reduced the interest to 6% p.a. in the present facts.
Esha Bhattacharjee v. Managing Committee of Raghunathpur Nafar Academy and Others., (2013) 12 SCC 649 Authorities on principles for condonation of delay; used to derive multiple principles and guidelines for dealing with delay applications. The court relied on the principles culled out from this and related authorities to frame a set of guidelines (paras 21 and 22) and to decide that the appellants' reasons (procedural/inter-departmental) warranted condonation subject to a cost.
N. Balakrishnan v. M. Krishnamurthy, (1998) Supp. 1 SCR 403 Principles elucidating the purpose of rules of limitation and the court's approach to condoning delay: public policy basis of limitation rules and the balance needed between strictness and justice. The court quoted and applied the underlying doctrine that rules of limitation serve public policy and that refusal to condone delay forecloses a suitor; this informed the court's exercise of discretion in condoning the delay subject to considerations of reasonableness and costs.
Shakuntala Devi Jain v. Kuntal Kumari, AIR 1969 SCR 1006 Support for liberal construction of the phrase "sufficient cause" under Section 5 of the Limitation Act to advance substantial justice. The court cited this authority (along with State of West Bengal v. Howrah Municipality) to justify a liberal, justice-oriented approach in adjudicating an application for condonation of delay and to frame the principles applied in the case.
State of West Bengal v. The Administrator, Howrah Municipality, (1972) 2 SCR 874 Support for liberal construction of "sufficient cause" and the court's duty to advance substantial justice. Cited to reinforce the approach of giving Section 5 a liberal construction, informing the court's decision to condone delay while weighing competing considerations.

Court's Reasoning and Analysis

The court examined the pleadings and documentary admissions in the record and proceeded in two main strands: (A) merits of the State Commission's findings on deficiency and reliefs, and (B) the application for condonation of delay in filing the appeal.

A. Merits — Deficiency, Interest and Compensation

  1. The court noted the State Commission's findings that the appellants had themselves admitted incompleteness of certain works: some revenue passages were yet to be acquired, sewerage connections for some plots were not connected to the main sewage, and some plots lay in the bed of the Rao Ki Drain which prevented construction. The court quoted the State Commission's observations showing the project was incomplete up to 19.06.2018.
  2. On that basis the court agreed there was a deficiency on the part of the appellants in failing to deliver possession within the stipulated period.
  3. However, the court found the interest rate of 12% per annum awarded by the State Commission to be excessive. The court referred to the Kolkata West authority where an interest rate in refund cases was reduced from 12% to 9% per annum, and reasoned that if 9% is awarded in refund cases, 12% cannot be justified where possession is being granted.
  4. Balancing these considerations, the court held that an interest rate of 6% per annum was "reasonable and appropriate" in the facts and circumstances of this case.
  5. Regarding the compensation of Rs.55,000 awarded by the State Commission for mental agony and litigation expenses, the court observed that since the interest had been substantially reduced, there was no reason to set aside the compensation award; therefore that portion of the State Commission's order remained intact.

B. Condonation of Delay

  1. The Registry's computation of delay showed 201 days; the appellants had applied to condone 178 days. The court acknowledged the delay was substantial and that the appellants attributed it to procedural formalities, obtaining higher orders and inter-departmental consultations.
  2. The court reviewed authorities (including Hemlata Verma, Esha Bhattacharjee, N. Balakrishnan, Shakuntala Devi Jain and State of West Bengal v. Howrah Municipality) and set out an array of principles governing condonation of delay: a liberal, pragmatic, justice-oriented approach; the elastic nature of "sufficient cause"; the need to weigh prejudice and laches; distinction between inordinate delay and short delays; scrutiny of bona fides; and that public bodies may be given some latitude.
  3. Applying these principles to the facts, the court deemed it appropriate to condone the delay but imposed a monetary condition: payment of Rs.20,000/- by the appellants to the complainant as costs for condonation.

Holding and Implications

Core Ruling: The First Appeal No.1703 of 2019 is partly allowed.

Direct consequences and implications as stated in the opinion:

  • The State Commission's order dated 15.10.2018 is modified only to the extent that the rate of interest awarded in para 17(ii) is changed from 12% per annum to 6% per annum.
  • The rest of the State Commission's order (including the direction to deliver possession and the award of Rs.55,000/- compensation) remains unchanged and continues to bind the appellants.
  • The court condoned the delay in filing the appeal and directed the appellants to pay Rs.20,000/- (twenty thousand rupees) to the complainant as a condition/cost for condonation of delay.
  • The opinion does not state that a new legal precedent was established; it applies existing precedents and principles to the facts and modifies the interlocutory financial relief (interest) and grants condonation on specified terms.

Presiding Member: Prem Narain

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    CHIEF ADMINISTRATOR PUNJAB URBAN DEVELOPERS AUTHORITY & ANR. v. MANJU CHAUHAN

    This appeal has been filed by the appellants Chief Administrator Punjab Urban Developers Authority and anr. against the order dated 15.10.2018 of the State Consumer Disputes Redressal Commission, Punjab, (in short the State Commission) passed in CC No.533 of 2018. Brief facts relevant for deciding the present appeal are that the respondent had booked a2. plot with the appellants/opposite parties and there was delay in possession as the development works were not complete. The respondent/complainant filed a complaint bearing CC No.533 of 2018 before the State Commission. The complaint was resisted by the opposite parties. However, the State Commission decided the complaint vide its order dated 15.10.2018 as under:-

    17. As a result of our above discussion, the complaint is allowed and following directions are issued to the opposite parties:

    i) to deliver physical possession of the plot, in question, complete in all respects, along with agreed facilities and Completion /Occupation Certificate issued by the competent authority; ii) to pay interest at the rate of 12% per annum on the entire amount deposited by the complainant i.e. Rs.53,89,860/- with effect from 01.04.2018 till delivery of physical possession of the plot, in question, complete in all respects, along with agreed facilities and Completion/Occupation Certificate issued by the competent authority; and iii) to pay Rs.55,000/-, as compensation on account of the mental agony and harassment suffered by the complainant, including litigation expenses.

    Hence the present appeal.3. Heard the learned counsel for the appellants as well as husband of the4. respondent/complainant. Learned counsel for the appellants stated that the appellants are Government organisation which works on no profit no loss basis. The delay has occurred due to the fact that work of sewerage line was not complete by that time. It was told to the complainant that when the construction of house by the complainant would be complete on the plot in question, sewerage line will also be completed and therefore it cannot be said that development was incomplete. Actually there was no deficiency on the part of the appellants/opposite parties. In fact the appellants are willing to give possession to the respondent/complainant, however, respondent/complainant is denying the same on one pretext or the other. Thus, there should be no question of awarding any interest on the deposited amount. It was further contended by the learned counsel that State Commission has awarded a compensation of Rs.55,000/- for which no justification has been given by the State Commission. It is accepted principle that when the interest is awarded on the amount, no separate compensation should be provided because interest is also in the form of compensation. It was requested that the order of the State Commission be modified and the respondent/complainant be directed to take the possession. Learned counsel for the appellants further stated that there is a delay of 178 days in filing the5. present appeal. It is stated that the delay has occurred due to observing various office processes as well as in obtaining higher order and in inter-departmental consultations. Thus, the appellants have strong case on merit and therefore, the delay is required to be condoned as the same is not intentional or deliberate. In support of her arguments learned counsel relied upon the judgment of Honble Supreme Court in Hemlata Verma Vs. M/s. ICICI Prudential Life Insurance Co. Ltd. & Anr., Civil Appeal No.5131 of 2019, decided on July 01,2019. Husband of the respondent/complainant stated that the appeal should be dismissed out6. rightly as the same has been filed with delay of 320 days. It was stated that the application has only been filed for 178 days, whereas the fact is that there is a delay of 320 days from the date of impugned order. Procedural delay cannot be accepted as sufficient cause for condoning the delay and no other pressing reason is given for not filing the appeal in time. Hence the application for condonation of delay is required to be dismissed as this is without any merit. Husband of the respondent/complainant stated that no offer letter has been received by the7. complainant and complainant has gone many times to the office of the appellants for getting possession. However, it was denied on one count or the other. However, the development works are not yet completed. The opposite parties have already admitted that sewerage line was not completed. It has been stated that it will be completed by the time the house is constructed on the plot. If the same is not completed, then the respondent/complainant will have to use the house without any sewerage connection. Thus, there is a clear deficiency on the part of the opposite parties and that is why the State Commission has awarded reasonable interest on the amount deposited along with compensation. I have carefully considered the arguments advanced by the learned counsel for the8. appellants as well as the husband of the complainant. The State Commission in its order has observed the following:-
    15. The opposite parties themselves admitted in their reply that some of the revenue passage is yet to be acquired, which is under process. Sewerage connection qua some plots is also yet to be connected with the main sewage. Still further, the opposite parties also admitted in their Note regarding the meeting held in the presence of Chief Administrator, PUDA on 19.06.2018, Ex.OP-8, that some of the plots situated in the project of the opposite parties fall in the bed of Rao Ki Drain of Patiala, as a result of which rainy water gets accumulated therein due to which construction is not possible on those plots. It is also mentioned therein that due amount towards revenue passages is yet to be paid and that after acquisition revenue passages, public utility would be connected with STP within 20 days. Incomplete work of revenue passages is also evident from letter issued by the opposite parties dated 11.01.2018, Ex.OP-9. Thus, from the evidence produced by the opposite parties itself, it stands proved that their project was incomplete till 19.06.2018. The fact remains that the opposite parties failed to deliver possession of the plot, in question, to the complainant within the stipulated period.
    From the above, it is clear that the development work was not totally complete and9. therefore, there was a clear deficiency on the part of the appellants. However, it is also seen that the interest granted by the State Commission is on a very high side and the same cannot be sustained. Honble Supreme Court in Kolkata West International Pvt. Ltd. Vs. Deva Asis has reduced the rate of interest on the amount of refund from 12%Rudra, II (2019) CPJ 29 (SC) per annum to 9% per annum. Thus, when the interest of 9% per annum is being awarded in refund cases, there can be no justification for interest @12% per annum when the possession is also granted. In my view, interest @ 6% per annum shall be reasonable and appropriate in the facts and circumstances of the present case. So far as the award of compensation of Rs.55,000/- by the State Commission is concerned, as the interest has been substantially reduced, I do not find any reason now to set aside this compensation. So far as the question of delay in filing the present appeal is concerned, the Registry has10. reported 201 days delay whereas the appellants have filed application for only delay of 178 days. Be that as it may, the delay is substantial and the reason for delay has been mostly the procedural and in obtaining higher orders and in inter- departmental consultations. Apart from the judgment of the Honble Supreme Court in 11. Hemlata Verma Vs. M/s. (supra) relied upon by the appellants theICICI Prudential Life Insurance Co. Ltd. & Anr. Honble Supreme Court in Esha Bhattacharjee vs . Managing Committee of has laid down: RaghunathpurNafar Academy and Others., (2013) 12 SCC 649 , -

    21. From the aforesaid authorities (case laws referred) the principles that can broadly be culled out are: 21.1. (i) There should be a liberal, pragmatic, justice-oriented, non- pedantic approach while dealing with an application for condonation of delay, for the courts are not supposed to legalise injustice but are obliged to remove injustice. 21.2. (ii) The terms sufficient cause should be understood in their proper spirit, philosophy and purpose regard being had to the fact that these terms are basically elastic and are to be applied in proper perspective to the obtaining fact- situation. 21.3. (iii) Substantial justice being paramount and pivotal the technical considerations should not be given undue and uncalled for emphasis. 21.4. (iv) No presumption can be attached to deliberate causation of delay but, gross negligence on the part of the counsel or litigant is to be taken note of. 21.5 (v) Lack of bona fides imputable to a party seeking condonation of delay is a significant and relevant fact. 21.6. (vi) It is to be kept in mind that adherence to strict proof should not affect public justice and cause public mischief because the courts are required to be vigilant so that in the ultimate eventuate there is no real failure of justice. 21.7 (vii) The concept of liberal approach has to encapsule the conception of reasonableness and it cannot be allowed a totally unfettered free play. 21.8 (viii) There is a distinction between inordinate delay and a delay of short duration or few days, for to the former doctrine of prejudice is attracted whereas to the latter it may not be attracted. That apart, the first one warrants strict approach whereas the second calls for a liberal delineation. 21.9 (ix) The conduct, behaviour and attitude of a party relating to its inaction or negligence are relevant factors to be taken into consideration. It is so as the fundamental principle is that the courts are required to weigh the scale of balance of justice in respect of both parties and the said principle cannot be given a total go by in the name of liberal approach. 21.10 (x) If the explanation offered is concocted or the grounds urged in the application are fanciful, the courts should be vigilant not to expose the other side unnecessarily to face such a litigation. 21.11. (xi) It is to be borne in mind that no one gets away with fraud, misrepresentation or interpolation by taking recourse to the technicalities of law of limitation. 21.12. (xii) The entire gamut of facts are to be carefully scrutinized and the approach should be based on the paradigm of judicial discretion which is founded on objective reasoning and not on individual perception. 21.13. (xiii) The State or a public body or an entity representing a collective cause should be given some acceptable latitude.

    22. To the aforesaid principles we may add some more guidelines taking note of the present day scenario. They are: 22.1. (a) An application for condonation of delay should be drafted with careful concern and not in a half hazard manner harbouring the notion that the courts are required to condone delay on the bedrock of the principle that adjudication of a lis on merits is seminal to justice dispensation system. 22.2. (b) An application for condonation of delay should not be dealt with in a routine manner on the base of individual philosophy which is basically subjective. 22.3. (c) Though no precise formula can be laid down regard being had to the concept of judicial discretion, yet a conscious effort for achieving consistency and collegiality of the adjudicatory system should be made as that is the ultimate institutional motto. 22.4. (d) The increasing tendency to perceive delay as a non- serious matter and, hence, lackadaisical propensity can be exhibited in a non-challant manner requires to be curbed, of course, within legal parameters. The Honble Supreme Court in another case 12. N. Balakrishnan Vs. M.Krishnamurthy, ( has laid down the following:-1998) Supp. 1 SCR 403,

    11. Rules of limitation are not meant to destroy the right of parties. They are meant to see that parties do not resort to dilatory tactics, but seek their remedy promptly. The object of providing a legal remedy is to repair the damage caused by reason of legal injury. Law of limitation fixes a life-span for such legal remedy for the redress of the legal injury so suffered. Time is precious and the wasted time would never revisit. During efflux of time newer causes would sprout up necessitating newer persons to seek legal remedy by approaching the courts. So a life span must be fixed for each remedy. Unending period for launching the remedy may lead to unending uncertainty and consequential anarchy. Law of limitation is thus founded on public policy. It is enshrined in the maxim Interest reipublicae up sit finis Mum (it is for the general welfare that a period be put to litigation). Rules of limitation are not meant to destroy the right of the parties. They are meant to see that parties do not resort to dilatory tactics but seek their remedy promptly. The idea is that every legal remedy must be kept alive for a legislatively fixed period of time.

    12. A court knows that refusal to condone delay would result in foreclosing a suitor from putting forth his cause. There is no presumption that delay in approaching the court is always deliberate. This Court has held that the words "sufficient cause" Under Section 5 of the Limitation Act should receive a liberal construction so as to advance substantial justice vide Shakuntala Devi Jain V. KuntalKumari, MANU/SC/0335/1968: [AIR 1969 SCR1006 and State of West Bengal Vs. The Administrator, Howrah Municipality, MANU/SC/0534/1971: [1972]2SCR874a.

    13. It must be remembered that in every case of delay there can be some lapse on the part of the litigant concerned. That alone is not enough to turn down his plea and to shut the door against him. If the explanation does not smack of mala fides or it is not put forth as part of a dilatory strategy the court must show utmost consideration to the suitor. But when there is reasonable ground to think that the delay was occasioned by the party deliberately to gain time then the court should lean against acceptance of the explanation. While condoning delay the Court should not forget the opposite party altogether. It must be borne in mind that he is a looser and he too would have incurred quiet a large litigation expenses. It would be a salutary guideline that when courts condone the delay due to laches on the part of the applicant the court shall compensate the opposite party for his loss.

    Keeping in view the above judgments of the Honble Supreme Court and in the facts and13. circumstances of the case, I deem it appropriate to condone the delay in filing the present appeal at a cost of Rs.20,000/- to be paid to the complainant by the appellants. Based on the above discussion, the First Appeal No.1703 of 2019 is partly allowed. The14. order dated 15.10.2018 of the State Commission is modified to the extent that the interest rate mentioned in para 17 (ii) shall be read as 6% p.a. instead of 12% p.a. Rest of the order of the State Commission remains unchanged. The appellants shall also pay a sum of Rs.20,000/- (rupees twenty thousand only) to the complainant for condoning the delay in filing the present appeal. ...................... PREM NARAIN PRESIDING MEMBER

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    CHIEF ADMINISTRATOR PUNJAB URBAN DEVELOPERS AUTHORITY & ANR. v. MANJU CHAUHAN
    (Feb 12, 2020)