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Smart Summary

Structured Summary of the Opinion: First Appeal No.68 of 2021 and Connected Appeals

Factual and Procedural Background

This judgment/order disposes of thirteen appeals together because the facts, questions of law and reliefs sought are the same. The factual narrative is extracted from First Appeal No.68 of 2021.

Naranjan Dass (appellant/complainant) filed First Appeal No.68 of 2021 under Section 41 of the Consumer Protection Act, 2019, challenging the District Consumer Disputes Redressal Commission, Jalandhar's impugned order dated 19.01.2021. The District Commission had allowed Consumer Complaint No.496 dated 04.12.2018 (filed under Section 12 of the Consumer Protection Act, 1986) and directed the respondent to refund Rs. 6,51,482/- as the cost of the flat with interest at 6% per annum from the date of allotment until final realization; additionally the District Commission awarded Rs. 30,000/- as compensation for mental and physical harassment and Rs. 5,000/- as litigation costs.

The appellant challenges only the interest portion of the District Commission's order, contending that interest was awarded on the lower side and that interest should be calculated from the dates of respective payments. Multiple other appeals (listed in the opinion) are disposed of in identical terms.

Legal Issues Presented

  1. Whether the rate of interest awarded by the District Commission (6% per annum) on the refundable amount should be enhanced.
  2. Whether interest should be computed from the date of allotment or from the respective dates of deposit of instalments.
  3. Whether the compensation amount (Rs. 30,000/-) and litigation costs (Rs. 5,000/-) awarded by the District Commission should be increased.

Arguments of the Parties

Appellant's Arguments

  • The appellant did not challenge the entire order but only the interest component, which was awarded at a lower rate (6%).
  • The allotment letter dated 28.01.2010 contained Clause-2 prescribing penal interest rates for the allottee's delay in depositing instalments (18% first month, 20% second month, 22% third month and 24% fourth month), showing higher contractual rates were contemplated.
  • The respondent (opposite party) had charged higher interest for delays by allottees but the District Commission awarded only 6% despite unexplained delay in delivery of possession by the respondent.
  • The complainant deposited the entire amount of instalments as per the payment schedule; therefore interest should be allowed from the dates of respective deposits until realization.
  • The District Commission's order contained contradictory findings on the rate of interest (6% in some operative paragraphs and 9% in others for different complaints), which is impermissible.
  • Counsel relied on earlier decisions (Jalandhar Improvement Trust v. Amita Patel; Jalandhar Improvement Trust v. Surinder Pal; Jalandhar Improvement Trust v. Chander Kanta) in support of the contention for higher interest.

Respondent's Arguments

  • The learned counsel for the respondent opposed the submissions made by the appellant. (The opinion records only that the respondent opposed appellant's submissions; no further detail of the respondent's arguments is provided.)

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
Jalandhar Improvement Trust v. Amita Patel — First Appeal No.642 of 2019 (order dated 03.12.2019) Relied upon by appellant in support of arguments regarding interest/relief (as cited by appellant). The court noted the appellant relied on this decision; the opinion records that the court perused the judgments cited by appellant but does not state that this specific decision was applied as the primary basis for modification.
Jalandhar Improvement Trust v. Surinder Pal — First Appeal No.60 of 2020 (order dated 23.06.2020) Relied upon by appellant in support of arguments regarding interest/relief (as cited by appellant). The court noted the decision was cited by appellant and that the court had gone through the judgments, without expressly adopting this decision as the controlling authority for the modification.
Jalandhar Improvement Trust v. Chander Kanta — First Appeal No.340 of 2019 (order dated 04.09.2019) Relied upon by appellant in support of arguments regarding interest/relief (as cited by appellant). The court recorded that counsel relied on this order and that the court had perused the judgments; the opinion does not indicate that this decision alone dictated the outcome.
Ravinder Singh Sehgal v. Jalandhar Improvement Trust — First Appeal No.39 of 2021 (order dated 05.03.2021) Found the rate of interest of 9% as awarded by the District Commission to be reasonable (Commission decision). The court expressly relied upon this subsequent Commission judgment, which, while itself relying on a Supreme Court decision, supported holding the rate of interest at 9% as reasonable; the court applied this reasoning to enhance interest from 6% to 9%.
Improvement Trust, Barnala v. Balbir Singh etc. — Civil Appeal Nos.7869-7876 of 2019 (Supreme Court judgment dated 04.10.2019) Authority relied upon by the Commission (in Ravinder Singh Sehgal) supporting the reasonableness of a 9% rate of interest in similar circumstances. The Commission judgment (Ravinder Singh Sehgal) relied on this Supreme Court judgment; the court in the present opinion noted that Ravinder Singh Sehgal relied upon the Supreme Court judgment and thereby treated 9% as reasonable in comparable cases, using that reasoning to justify enhancement to 9% per annum in the present matters.

Court's Reasoning and Analysis

The court undertook the following analysis, based strictly on the material in the file and the arguments presented:

  • The court noted the admitted facts: the appellant was successful in the draw of lots on 16.08.2009 and allotted the flat vide allotment letter dated 28.01.2010; possession was not handed over despite a lapse of about nine years from allotment to the filing of the complaint.
  • The court observed that the complainant deposited instalments from August 2009 to 2015 and thus was entitled to interest from the respective dates of deposit until realization, not necessarily from the date of allotment. The appellant himself admitted in Para-6(c) of the grounds of appeal that the District Commission had wrongly awarded interest from the date of allotment.
  • The court found that the District Commission had given internally contradictory directions in the impugned order: for example, in relation to CC No.495 of 2018 (subject matter of First Appeal No.69 of 2021), Para-22 directed refund with interest at 9% per annum, but Para-28 of the same order directed refund with interest at 6% per annum. Similar contradictions were noted in CC No.143 of 2018. The court treated such contradictory findings as not permissible under law.
  • The court considered the appellant's reliance on prior Commission orders (three Jalandhar Improvement Trust matters) and noted that the Commission itself, in a subsequent judgment dated 05.03.2021 (Ravinder Singh Sehgal v. Jalandhar Improvement Trust), relying upon the Supreme Court judgment in Civil Appeal Nos.7869-7876 of 2019 (Improvement Trust, Barnala v. Balbir Singh), held that a 9% rate of interest awarded by the District Commission was reasonable in similar cases.
  • Balancing these considerations, the court concluded that: (a) the rate of interest of 6% awarded by the District Commission was on the lower side and inconsistent with other decisions; (b) the complainant was entitled to interest from the respective dates of deposit until realization; and (c) the compensation of Rs. 30,000/- and litigation costs of Rs. 5,000/- awarded by the District Commission were just and reasonable and therefore need not be enhanced.
  • Accordingly, the court modified the impugned order to enhance the rate of interest to 9% per annum on the refundable amount, to be paid from the respective dates of deposit until realization, while leaving compensation and costs unchanged. The court applied the same operative modification to the other appeals covered by the order.

Holding and Implications

APPEAL PARTLY ALLOWED

Core ruling (operative result):

  • The impugned order is modified to the extent that the rate of interest awarded by the District Commission is enhanced from 6% to 9% per annum. This 9% interest is to be paid on the refundable amount as ordered by the District Commission, calculated from the respective dates of deposit of the amounts until realization.
  • The amounts of compensation (Rs. 30,000/-) and litigation costs (Rs. 5,000/-) awarded by the District Commission remain unchanged.
  • The same operative modification (enhancement of interest to 9% per annum with interest computed from respective deposit dates) is applied to the other appeals listed in the opinion, which are disposed of in the same terms as First Appeal No.68 of 2021.
  • Necessary compliance in all the cases is to be made within 30 days from the date of receipt of a certified copy of the order.

Implications: The decision directly affects the parties by increasing the rate of interest recoverable on refundable amounts to 9% per annum and clarifies that interest must be computed from the dates of respective deposits until realization. The opinion applies that modification uniformly to multiple connected appeals. The opinion does not elaborate on broader doctrinal consequences beyond these direct effects.

Signed: JUSTICE DAYA CHAUDHARY (PRESIDENT) and RAJINDER KUMAR GOYAL (MEMBER) — September 03, 2021.

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    Naranjan Dass v. Jalandhar Improvement Trust

    2) To be referred to the Reporters or not? Yes/No

    3) Whether judgment should be reported in the Digest? Yes/No Argued By (F.A. No.68 of 2021):- For the appellant : Sh. Sanjeev Goyal, Advocate For the respondent : Sh. Sanjeev Soni, Advocate. JUSTICE DAYA CHAUDHARY, PRESIDENT By this judgment/order, the above noted 13 (thirteen) appeals shall be disposed of, as the facts, question of law and relief sought in all the cases are the same. However, for the convenience of this Commission, the facts are extracted from First Appeal No.68 of 2021. First Appeal No.68 of 2021

    2. Appellant/complainant-Naranjan Dass has filed the present appeal under Section 41 of the Consumer Protection Act, 2019, to challenge the impugned order dated 19.01.2021 passed by the District Consumer Disputes Redressal Commission, Jalandhar (hereinafter to be called as the District Commission), whereby Consumer Complaint No.496 dated 04.12.2018 under Section 12 of the Consumer Protection Act, 1986 filed by complainant-Naranjan Dass, along with other complaints, was allowed and the respondent/opposite party was directed to refund an amount of 6,51,482/- as cost of the flat in dispute, which was paid by the complainant to the opposite party, along with interest at the rate of 6% from the date of allotment till its First Appeal No.68 of 2021 final realization. The opposite party was also directed to pay an amount of 30,000/- as compensation for the mental and physical harassment faced by the complainant and to pay an amount of 5,000/- as cost of litigation.

    3. It would be apposite to mention that hereinafter the parties will be referred, as have been arrayed before the District Commission.

    4. Mr. Sanjeev Goyal, learned counsel for the appellant/ complainant submits that the complainant is not challenging the complete order, but the interest part only, as the same has been awarded on the lower side. He further submits that the District Commission has lost sight of the fact that while issuing allotment letter dated 28.01.2010, there was Clause-2 therein that in case there is delay in depositing the instalments as per the payment schedule, the allottee was to pay the penal interest at the rate of 18% for the first month, 20% for the second month, 22% for the third month and 24% for the fourth month. He further submits that the opposite party is charging higher rate of interest on account of delay in making payment of instalments on the part of allottee, but the learned District Commission has awarded interest only at the rate of 6%, whereas there was unexplained delay in delivery of possession. He further argued that the order passed by the District Commission is contradictory, as two different findings with regard to award of interest and compensation have been given. In one case i.e. CC No.143 of First Appeal No.68 of 2021 2019 and CC No.406 of 2019, a direction has been issued to refund the amount along with interest at the rate of 9% per annum from the date of allotment till realization, but in Para Nos.26 to 29 of the impugned order, a direction has been issued to the opposite party to refund the amount, along with interest at the rate of 6% per annum, meaning thereby different findings have been in CC No.143 of 2019 and CC No.495 of 2019, whereas the order was common. At the end, learned counsel for the appellant has relied upon judgments/orders dated 03.12.2019 passed in First Appeal No.642 of 2019 (Jalandhar Improvement Trust v. Amita Patel); dated 23.06.2020 passed in First Appeal No.60 of 2020 (Jalandhar Improvement Trust v. Surinder Pal); as well as dated 04.09.2019 passed in First Appeal No.340 of 2019 (Jalandhar Improvement Trust v. Chander Kanta), in support of his arguments.

    5. Mr. Sanjeev Soni, learned counsel for the respondent/ opposite party has opposed the submissions made by learned counsel for the appellant.

    6. Heard arguments of the learned counsel for the parties. We have also perused the documents available on the file. We have also gone through the judgments cited by the learned counsel for the appellant.

    7. Admittedly, the appellant/complainant was declared successful in the draw of lots held on 16.08.2009 and the flat was First Appeal No.68 of 2021 allotted to him, vide allotment letter dated 28.01.2010. The possession of the flat was to be handed over to the allottee with all amenities/facilities with quality of standard construction. Admittedly, the possession of the flat was not handed over to the complainant- allottee, despite lapse of about nine years from the date of allotment till the filing of the complaint. The appellant/complainant is aggrieved that the interest awarded by the District Commission is on the lower side and also that the complainant had deposited the entire amount of instalments as per payment schedule mentioned in the allotment letter. The complainant is entitled to get the interest from the date of respective payments till realization and also for compensation and litigation expenses, which are on the lower side. Learned District Commission has lost sight of the fact that the opposite party has failed to give possession to the appellant, despite deposit of whole amount of sale price and long delay has been caused. Moreover, the appeal has been filed for modification of rate of interest and to award more compensation and litigation expenses. By considering the submissions and on perusal of impugned order, we do not find it appropriate to enhance the amount of compensation and cost of litigation as awarded by the District Commission, which are just and reasonable. However, the rate of interest i.e. 6% is admittedly on the lower side and in similar cases the rate of interest cannot be different. First Appeal No.68 of 2021

    8. As far as the reliance of the learned counsel for the appellant on the aforesaid judgments/orders is concerned, after passing the orders in those cases, this Commission in a subsequent judgment dated 05.03.2021 passed in First Appeal No.39 of 2021 (Ravinder Singh Sehgal v. Jalandhar Improvement Trust), while relying upon judgment dated 04.10.2019 passed by the Honble Supreme Court in Civil Appeal Nos.7869-7876 of 2019 (Improvement Trust, Barnala v. Balbir Singh etc.), held the rate of interest i.e. 9% as awarded by the District Commission to be reasonable.

    9. As far as award of interest from the date of allotment is concerned, the appellant/complainant has fairly admitted in Para-6(c) of grounds of appeal that the District Commission has wrongly awarded interest from the date of allotment, as the amount was deposited in instalments from August, 2009 to 2015 and the complainant is entitled to interest from the dates of respective deposits. Even otherwise, in case of payment of amount in instalments on different dates, the interest on refundable amount is to be awarded from the respective dates of deposit till realization.

    10. In para-22 of the impugned order, which relates to CC No.495 of 2018, which is subject matter of First Appeal No.69 of 2021, the opposite party was directed refund the amount of 6,14,953.50 as price of the flat along with interest at the rate of 9% from the date of allotment till its realization, besides 50,000/- towards compensation First Appeal No.68 of 2021 for mental and physical harassment and 10,000/- as costs of litigation. However, In Para-28 of the impugned order, where the final decision of the said complaint is mentioned, the opposite party was directed to refund the above said amount, along with interest at the rate of 6% from the date of allotment till its realization, besides 30,000/- towards compensation for mental and physical harassment and 5,000/- as costs of litigation. The District Commission has given two contradictory findings/directions in this case, which is not permissible under law. It is pertinent to mention here that the appellant in the grounds of appeal has also admitted that the District Commission has awarded compensation of 30,000/- and 5,000/- which are on lower side. Similarly, contradictory findings/reliefs have been also given in CC No.143 of 2018, which is the subject matter of First Appeal No.165 of 2021. Keeping in view the uniformity in the amount of compensation (30,000/-) and litigation costs (5,000) in majority of the cases covered under this order as well as admission of appellant(s) in the grounds of appeal, it needs to be made clear that the District Commission awarded compensation of 30,000/- and litigation costs of 5,000/-, which are just and reasonable.

    11. Accordingly, the appeal is partly allowed and the impugned order is modified to the extent that the rate of interest as awarded by the District Commission is enhanced from 6% to 9% per annum, which shall be paid on the refundable amount as ordered by the District First Appeal No.68 of 2021 Commission from the respective dates of deposit till realization. The amount of compensation (30,000/-) and litigation costs (5,000) shall remain the same. First Appeal No.69 of 2021

    12. This case is disposed of in the same terms of order passed in First Appeal No.68 of 2021. The operative part of that order is reproduced as under: Accordingly, the appeal is partly allowed and the impugned order is modified to the extent that the rate of interest as awarded by the District Commission is enhanced from 6% to 9% per annum, which shall be paid on the refundable amount as ordered by the District Commission from the respective dates of deposit till realization. The amount of compensation (30,000/-) and litigation costs (5,000) shall remain the same. First Appeal No.165 of 2021

    13. This case is disposed of in the same terms of order passed in First Appeal No.68 of 2021. The operative part of that order is reproduced as under: Accordingly, the appeal is partly allowed and the impugned order is modified to the extent that the rate of interest as awarded by the District Commission is enhanced from 6% to 9% per annum, which shall be paid on the refundable amount as ordered by the District Commission from the respective dates of deposit till realization. The amount of compensation (30,000/-) and litigation costs (5,000) shall remain the same. First Appeal No.68 of 2021 First Appeal No.145 of 2021

    14. This case is disposed of in the same terms of order passed in First Appeal No.68 of 2021. The operative part of that order is reproduced as under: Accordingly, the appeal is partly allowed and the impugned order is modified to the extent that the rate of interest as awarded by the District Commission is enhanced from 6% to 9% per annum, which shall be paid on the refundable amount as ordered by the District Commission from the respective dates of deposit till realization. The amount of compensation (30,000/-) and litigation costs (5,000) shall remain the same. First Appeal No.146 of 2021

    15. This case is disposed of in the same terms of order passed in First Appeal No.68 of 2021. The operative part of that order is reproduced as under: Accordingly, the appeal is partly allowed and the impugned order is modified to the extent that the rate of interest as awarded by the District Commission is enhanced from 6% to 9% per annum, which shall be paid on the refundable amount as ordered by the District Commission from the respective dates of deposit till realization. The amount of compensation (30,000/-) and litigation costs (5,000) shall remain the same. First Appeal No.147 of 2021

    16. This case is disposed of in the same terms of order passed in First Appeal No.68 of 2021. The operative part of that order is reproduced as under: First Appeal No.68 of 2021 Accordingly, the appeal is partly allowed and the impugned order is modified to the extent that the rate of interest as awarded by the District Commission is enhanced from 6% to 9% per annum, which shall be paid on the refundable amount as ordered by the District Commission from the respective dates of deposit till realization. The amount of compensation (30,000/-) and litigation costs (5,000) shall remain the same. First Appeal No.163 of 2021

    17. This case is disposed of in the same terms of order passed in First Appeal No.68 of 2021. The operative part of that order is reproduced as under: Accordingly, the appeal is partly allowed and the impugned order is modified to the extent that the rate of interest as awarded by the District Commission is enhanced from 6% to 9% per annum, which shall be paid on the refundable amount as ordered by the District Commission from the respective dates of deposit till realization. The amount of compensation (30,000/-) and litigation costs (5,000) shall remain the same. First Appeal No.164 of 2021

    18. This case is disposed of in the same terms of order passed in First Appeal No.68 of 2021. The operative part of that order is reproduced as under: Accordingly, the appeal is partly allowed and the impugned order is modified to the extent that the rate of interest as awarded by the District Commission is enhanced from 6% to 9% per annum, which shall be paid on the refundable amount as ordered by the District Commission from the respective dates of deposit till realization. The amount of compensation (30,000/-) and litigation costs (5,000) shall remain the same. First Appeal No.68 of 2021 First Appeal No.197 of 2021

    19. This case is disposed of in the same terms of order passed in First Appeal No.68 of 2021. The operative part of that order is reproduced as under: Accordingly, the appeal is partly allowed and the impugned order is modified to the extent that the rate of interest as awarded by the District Commission is enhanced from 6% to 9% per annum, which shall be paid on the refundable amount as ordered by the District Commission from the respective dates of deposit till realization. The amount of compensation (30,000/-) and litigation costs (5,000) shall remain the same. First Appeal No.198 of 2021

    20. This case is disposed of in the same terms of order passed in First Appeal No.68 of 2021. The operative part of that order is reproduced as under: Accordingly, the appeal is partly allowed and the impugned order is modified to the extent that the rate of interest as awarded by the District Commission is enhanced from 6% to 9% per annum, which shall be paid on the refundable amount as ordered by the District Commission from the respective dates of deposit till realization. The amount of compensation (30,000/-) and litigation costs (5,000) shall remain the same. First Appeal No.199 of 2021

    21. This case is disposed of in the same terms of order passed in First Appeal No.68 of 2021. The operative part of that order is reproduced as under: Accordingly, the appeal is partly allowed and the impugned order is modified to the extent that the rate of interest as First Appeal No.68 of 2021 awarded by the District Commission is enhanced from 6% to 9% per annum, which shall be paid on the refundable amount as ordered by the District Commission from the respective dates of deposit till realization. The amount of compensation (30,000/-) and litigation costs (5,000) shall remain the same. First Appeal No.200 of 2021

    22. This case is disposed of in the same terms of order passed in First Appeal No.68 of 2021. The operative part of that order is reproduced as under: Accordingly, the appeal is partly allowed and the impugned order is modified to the extent that the rate of interest as awarded by the District Commission is enhanced from 6% to 9% per annum, which shall be paid on the refundable amount as ordered by the District Commission from the respective dates of deposit till realization. The amount of compensation (30,000/-) and litigation costs (5,000) shall remain the same. First Appeal No.201 of 2021

    23. This case is disposed of in the same terms of order passed in First Appeal No.68 of 2021. The operative part of that order is reproduced as under: Accordingly, the appeal is partly allowed and the impugned order is modified to the extent that the rate of interest as awarded by the District Commission is enhanced from 6% to 9% per annum, which shall be paid on the refundable amount as ordered by the District Commission from the respective dates of deposit till realization. The amount of compensation (30,000/-) and litigation costs (5,000) shall remain the same. First Appeal No.68 of 2021

    24. Necessary compliance in all the cases shall be made within a period of 30 days from the date of receipt of certified copy of the order. (JUSTICE DAYA CHAUDHARY) PRESIDENT (RAJINDER KUMAR GOYAL) MEMBER September 03, 2021. (Gurmeet S)

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    Naranjan Dass v. Jalandhar Improvement Trust
    (Sep 3, 2021)