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CASE NO.: Appeal (civil)  3407 of 2003

PETITIONER: Haryana Urban Development Authority                      

RESPONDENT: K. C. Kad                                                                

DATE OF JUDGMENT: 10/08/2004

BENCH: S. N. VARIAVA & ARIJIT PASAYAT

JUDGMENT: J U D G M E N T 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 Complainants, interest at  the rate of 18% per annum irrespective of the fact of each case.  This  Court has, in the case of Ghaziabad Development Authority vs. Balbir  Singh reported in (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 Forums 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 co-relate 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.

       This Court is now taking up the cases before it for disposal as  per principles set out in 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.   

In this case the Respondent was allotted a plot No. 871, Sector  31, Faridabad, vide letter dated 15th July, 1983.    The Respondent  paid all dues but was not offered possession.  On these facts, the  District Forum directed to deliver physical possession of allotted plot,  otherwise to allot alternate plot in adjoining sectors.  The District  Forum also awarded compound interest @ 18% p.a. w.e.f. 1st of  January, 1987 till delivery of possession and compensation for  escalation in cost of construction as per rates of CPWD, and Rs.  2,000/- towards litigation cost.    

The State Forum reduced the rate of interest from 18% to 12%.   The Respondent did not go in Revision before the National  Commission.  The Appellants went in Revision before the National  Commission.  The National Commission has increased the rate of  interest to 18% p.a.   

       For reasons set out in the Judgment in the case of Ghaziabad  Development Authority vs. Balbir Singh (supra), the order of the  National Commission cannot be sustained and is hereby set aside.  As

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stated above, the relevant papers regarding the claim made, the  affidavits filed, the evidence submitted before the District Forum are  not produced before this Court.   In this case, the Appellant have paid  interest @ 10% till a particular date and have delivered possession of  an alternate plot No. 652, Sector 31, Faridabad on 16th March, 2001.    The District Forum has not awarded compensation for mental agony  and harassment.     Where possession is given at old rate, the party  has got benefit of escalation in price of land.  Thus there cannot and  should not also be award of interest on the money.  But considering  the fact that the allotment was in 1983 and possession given only in  2001 the Respondent has suffered mental agony and harassment.  The  cost of construction has also gone up.   He should have been  compensated for these under these heads.     In this case, the District  Forum has awarded escalation in the price of construction.  The  District Forum will now work out what that increase would be and  Appellants will then pay that increase to the Respondent.  On an ad- hoc basis, we feel that a simple interest @ 12 % from the date of  deposit till payment will suffice as compensation for mental agony and  harassment.  Rest of the Order of the District Forum shall stand  revived. We are informed that in spite of there being no stay and in spite  of clarification given by this Court’s Order [reported in (2004) 5 SCC  65], the entire interest amounts have still not been paid.  We feel that  for the lapse Appellants must pay interest at the rate of 15% from 17th  March, 2004 till payment.   Appellants shall also pay costs fixed at  Rs.500/- to the Legal Aid Society of the Supreme Court. This cost shall  be in addition to costs awarded by the District Forum. The Appellants  must recover the amount paid towards costs to Legal Aid Society  personally from the officer/s, who were responsible for not paying  even after clarification by this Court.

We clarify that this Order shall not be taken as a precedent in  any other matter as the order is being passed taking into account  special features of the case.   The Forum/Commission will follow the  principles laid down by this Court in the case of Ghaziabad  Development Authority vs. Balbir Singh (supra) in future cases.          This Appeal is disposed of accordingly.