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CASE NO.: Appeal (civil)  7225 of 2002

PETITIONER: Bihar State Housing Board                                        

RESPONDENT: Arun Dakshy                                                      

DATE OF JUDGMENT: 23/08/2005

BENCH: ARIJIT PASAYAT & H.K. SEMA  

JUDGMENT: J U D G M E N T

H.K.SEMA,J

               This appeal preferred by the Bihar State Housing Board is  directed against the judgment and order dated 5.10.2001 passed by the  National Consumer Disputes Redressal Commission (hereinafter the  Commission) passed in Revision Petition No.2099 of 1999 affirming the  orders passed by the State Consumer Dispute Redressal Commission and  District Consumer Forum awarding interest @ 18%.                 Despite receipt of the notice, none entered appearance on behalf  of the sole respondent.                 Briefly stated the facts are as follows:-                 On 27.7.1989, the respondent deposited an amount of  Rs.15,000/- for allotment of MIG House in Barari Housing Colony in  Bhagalpur, Bihar, under the Bihar State Housing Board (Management and  Disposal of Housing Estate) Regulation 1983 (hereinafter the Regulation).   Under the Regulation, the allotment of plots/house/flat is to be made by  draw of lottery.   The respondent was unsuccessful in the draw of lottery and  so he could not be allotted a house under the MIG category.  On 28.7.1993,  the respondent issued legal notice to the appellant for refund of an amount of  Rs.15,000/-.  The aforesaid notice was replied by a letter dated 6.10.1993 by  the appellant, directing the respondent to submit original pay-in-slip for the  purpose of refund.  On 15.11.1994, the respondent submitted the original  pay-in-slip. Thereafter, the appellant refunded Rs.15,000/- to the respondent  vide cheque No.223231 dated 6.12.1995.  On 26.3.1996, the respondent filed  a complaint before the District Forum.  The District Forum passed an Award  directing the appellant to pay Rs.15,000/- with 18% interest.  The appellant  was also directed to pay Rs.5,000/- as compensation.  Being aggrieved, the  appellant filed an appeal before the State Consumer Commission, which was  rejected, being barred by limitation.                 Notice was issued limited to the question of rate of interest.                  At this stage, it may be noted that the contention of the  appellant, before the Commissions was that as per Regulation 45 of the  Regulation, simple interest @ 5% will be payable on an amount of earnest  money.  It would appear from the impugned order of the National  Commission dated 5th October, 2001, the same contention was also raised  before the Commission without any result.  It was also brought to the notice  of the Commission that in an identical case in Civil Appeal Nos.1566-67 of  1997 arising out of S.L.P ( C ) Nos.26021-22 of 1995 titled Bihar State  Housing Board & Ors.   Vs.    Vijay Sharan & Ors. disposed of on  17.2.1997, this Court held that the respondents are entitled to interest @ 5%  under Regulation 45 of the Regulation instead of awarded interest @ 11%.    This Court further pointed out that when the Regulation fixed the rate of  interest, the Commission could not give a direction to pay the interest  contrary to the interest regulated by the statute.                  It is noticed that in the impugned order while affirming the

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Award of interest @ 18% awarded by the District Forum and the State  Consumer Commission, the National Commission referred to the interest  awarded @ 18% by the Commission in the case of  HUDA   vs.  Darsh  Kumar.  Awarding of interest @ 18% by the National Commission in    Darsh Kumar (supra) was considered by this Court in the case of  Ghaziabad Development Authority   Vs.  Balbir Singh, (2004) 5 SCC 65,  where this Court deprecated the Award of 18% interest at a flat rate after  threadbare discussion. It was held in paragraph 10 of the judgment as under:-         "As has been set out hereinabove, the National  Forum has been awarding interest at a flat rate of  18% per annum irrespective of the facts of each  case.  This, in our view, is unsustainable.  Award  of compensation must be under different separate  heads and must vary from case to case depending  on the facts of each case."  

               Learned counsel for the appellant contended and in our opinion  rightly, that the Commission should not have travelled beyond the interest  regulated by the statutory regulation, which fixed at 5% and awarding 18%  interest dehors the Regulation 45 of the said Regulation.    In the instant  case, in the Regulation itself namely Regulation 45 provides that the simple  interest  @ 5% will be payable on the money so deposited.   The Regulation  being self-contained and the interest payable under the Regulation being  regulated by the statute under Regulation 45 of the Bihar State Housing  Board Regulation, the Commission should not have travelled beyond the  pale of statutory Regulation, apart from awarding interest @18% at the flat  rate being deprecated by this Court in Balbir Singh (supra).                  For the reasons aforestated, the impugned orders are not  sustainable in law and they are being quashed and set-aside.  The respondent  is entitled to interest  @ 5% as envisaged under the Regulation 45.  The  Award of compensation of Rs.5000/- is also set-aside.  The appeal is  allowed.   No costs.