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GDA directed to pay 15% interest for the delay in handing over of the flat and it should recover this amount from the officers responsible for this delay.

National Consumer Disputes Redressal Commission, New Delhi

(from the order dated 19.7.99 in Appeal No.2592/SC/98 of the State Commission, U.P.)

Ram Kishore Tiwari                                  .. Petitioner
Ghaziabad Development Authority            .. Respondent

BEFORE: Hon'ble Mr. Justice M.B.Shah, President, Dr. P.D.Shenoy, Member



M.B.Shah, J., President:

     It is the case of the complainant that he had applied on 30.11.1988 for a flat which was being constructed by Ghaziabad Development Authority (hereinafter referred to as the GDA) under Kaushambi Apartments, Phase-II, Self Financing Scheme. The cost of the flat was fixed at Rs.3 lakhs. He deposited Rs.30,000/- on the same day and thereafter Rs.30,000/on 23.3.1989. Again he deposited Rs.60,000/- on 5.2.1991. Thereafter, vide letter dated 23.7.1991, the GDA allotted Flat No.103, `Aravali Apartments' with an indication that the complainant should take possession of the flat after paying a sum of Rs.45000/ and he was informed that value of the flat was Rs.345000/-. It is contended by the complainant that possession of the flat was not delivered to him and that from the other allottees of the same building the GDA has recovered the cost of the flat at the rate of Rs.260000/-. Hence, he filed Complaint Case No.1227 of 1994 before the District Forum, Ghaziabad. 

     On receipt of the notice GDA filed written version admitting that complainant has deposited the amount but the cost of the flat was tentative and, therefore, he was required to pay the final price which was fixed at Rs.3,45,000/-. It was also pointed out that the price of the flat at Kaushambi Apartment, Phase-I was no doubt Rs.2,60,000/- but complainant was allotted flat in Kaushambi Apartment, Phase-II, where the price was Rs.3,45,000/-. 

     The District Forum by its judgement and order dated 21.9.1998 arrived at the conclusion that flats for which cost of Rs.260000/- was charged were allottees in Phase-I. As against this, complainant is allotted flat in Phase-II where the price fixed was Rs.3,00,000/- which was only estimated cost and the same has been enhanced by Rs.3,45,000/-. Therefore, the cost of Rs.3,45,000/- realized by the GDA cannot be said to be illegal. However, it arrived at the conclusion that there was delay on the part of the GDA in handing over possession as in a Self Financing Scheme the complainant has deposited the last instalment on 5.2.1991 and, therefore, possession ought to have been delivered by 31.3.1991. Hence, the complainant was entitled to recover interest for delayed period from 1.4.1991 till the date of possession. The District Forum, therefore, ordered that the GDA shall deliver the possession of the allotted apartment after fully developing it with essential services within two months from the date of the order ; it shall pay interest to the complainant at the rate of 18% per annum from 1.4.1991 till the date of handing over of possession and pay Rs.2000/- towards costs. 

    Against that order, the complainant preferred Appeal No.2592/SC/1998 before the State Commission, U.P. The GDA also preferred Appeal No.2593/SC/1998. Both the appeals were heard together. 

     The State Commission held that admittedly there are two phases in which Kaushambi Apartments have been constructed. For Kaushambi Scheme Phase-I, the price of the flat was Rs.2,60,000/- while the price fixed for Phase-II was Rs.3,00,000/-. Thereafter, escalated price of Rs.45,000/- has to be paid by the complainant.The Commission observed that the complainant has deposited Rs.300000/- in the year 1991 but has not deposited escalated price of Rs.45,000/- till 18.8.1998. He deposited a sum of Rs.51795/- only on 18.8.1998. The Commission further held that there was no evidence on record to show that the letter dated 10.7.1991 for delivering the possession of the flat was served upon the complainant. Therefore, there was no question of depositing the escalated cost of Rs.51,795/- at that time. The Commission, therefore, observed that even after depositing Rs.51,795/- on 18.8.1998, the possession of the flat was not delivered by the GDA. Hence, appeals filed by the complainant and the GDA were dismissed.

    Against that order, complainant has filed Revision Petition No.2267 of 1999 and the GDA filed Revision Petition No.1871 of 1999.

     In the Revision Petition filed by the GDA, at the time of admission of the matter, this Commission by its order dated 16.12.1999 rejected the prayer for stay of the execution of the order passed by the State Commission. Against that order, GDA preferred SLP before the Supreme Court. The Supreme Court directed that pending disposal of the revision application, GDA shall pay interest @ 12% per annum for delay in handing over possession.

Revision Petition No.2267/1999 (Filed by the Complainant)

     In this Revision Petition, the grievance of the complainant is that the GDA has allotted the flats in the same building, of the same area, by fixing the price at Rs.2,60,000/-. It is his contention that the GDA had arbitrarily recovered Rs.3,00,000/- from him and had also directed to pay Rs.45,000/- as escalated cost. He pointed out that the State Commission committed error in referring to Phase-I and Phase-II of Kaushambi Apartment Scheme because all throughout he has referred to allotment of flats in Aravali Apartments.

     After hearing the matter on 2nd February, 2005, the GDA was given two weeks' time to file affidavit dealing with this issue. No such affidavit is filed nor the Advocate appearing for the GDA was in a position to throw any light. 

     However, considering the fact that at the time of allotment of flat to the Complainant in the year 1988 the price fixed was Rs.3 lakhs which was accepted by the Complainant, and, therefore, at this stage it would not be proper to modify the said price fixation. 

     In this view of the matter, the Revision Petition filed by the Complainant is dismissed. There shall be no order as to costs. 

Revision Petition No. 1871 of 1999 (Filed by the GDA)

     The only question that requires consideration is whether the Complainant should get compensation/interest at the rate of 12% or 18% p.a. from the GDA? 

     Undisputedly, in the present case the Petitioner applied for the flat in November, 1988. He deposited Rs.30,000 on 23rd March, 1989 and Rs.60,000/- on 5.2.1991 and thereafter, allotment letter dated 3.7.1991 was issued in favour of the Complainant. Despite this allotment letter, the possession of the flat was not handed over to the Complainant for years together. 

     As against this, learned counsel for the GDA submitted that in view of the decision rendered by the Apex Court in the case of Ghaziabad Development Authority Vs. Balbir Singh (2004) 5 SCC 65 there is no question of granting interest more than 12% p.a. would arise.

     In Ghaziabad Development Authority Vs. Balbir Singh, 2005 CTJ 124 (Supreme Court) decided in Civil Appeal No. 7173 of 2002 on 3.12.2004, the Apex Court, dealing with similar contention, held that normally in a case of delivery of possession, though belatedly stands on a different footing from non-delivery of possession, because in case of delivery of possession though belatedly the allottee enjoys the benefit of flat/plot. Generally, in such cases rate of interest should not exceed 12%. However as already observed by the Apex Court in Ghaziabad Development Authority Vs. Balbir Singh, 2004 CTJ 605 (SC)(CP) = (2004) 5 SCC 64, no hard and fast rule can be laid down. The relevant portion reads as under:

"Normally, a case of delivery of possession, though belatedly, stands on a different footing from non-delivery of possession at all because in case of delivery of possession, though belatedly, the allottee also enjoys the benefit of plot/flat. Generally, in such a situation, the rate of interest should not exceed 12%. However, as already observed by this Court in Balbir Singh's case (Supra) no hard-and-fast rules can be laid down. In a specific case where it is found that delay was culpable and there is no contributory negligence by the allottee resulting in harassment/injury, both mental and physical, the Forum/Commission would not be precluded from making an award in excess of 12% interest per annum. Such order must, however, be supported with reasons."

     The facts and circumstances of the case are that the allotment letter was issued in July,1991; possession was not delivered; the District Forum directed on 21.9.98 the GDA to handover possession; order not complied with; similar order passed by the State Commission on 19.7.99 was also not complied with. Possession was handed over only on 10.8.2000 (on 20.5.2000 as contended by the GDA). For this delay, there is no justifiable ground. The complaint was that the concerned officers, for reasons best known to them, delayed the delivery of possession by demanding extra amount on the basis of escalation of the cost. It is his say that to some allottees, possession was handed over at the earliest and from them only Rs.260000/- was recovered as cost of the flat. 

     It is apparent that there is no reasonable or justifiable explanation for not handing over the possession. A retired employee who has paid the entire amount payable by him was deprived of residential accommodation by high handed exercise of power by the officers of the GDA. Considering these fact, we direct the GDA to pay interest at the rate of 15% p.a. instead of 18% p.a. as directed by the District Forum. This would meet the ends of justice.

     In Lucknow Development Authority Vs. M.K.Gupta (1994) 1 SCC 243, the Supreme Court observed that the authority empowered to function under a statute while exercising power discharges public duty; it has to act to observe general welfare in common good; in ordinary matters a common man who has neither the political backing nor the financial strength to match the inaction in public oriented departments gets frustrated and it erodes the credibility in the system; where it is found that exercise of discretion was mala fide and the complainant is entitled to compensation for mental and physical harassment then the officer can no more claim to be under any protective cover. The Court pertinently held : "It should further direct the department concerned to pay the amount to the complainant from the public fund immediately but to recover the same from those who are found responsible for such unpardonable behaviour by dividing it proportionately where there are more than one functionaries."

     For better administration/governance the aforesaid law is required to be implemented so that the welfare schemes framed by the Government reach the common consumer and the objects of such schemes are not frustrated. We hold that there is total negligence on the part of the concerned officers of the GDA as they have acted arbitrarily in not delivering the possession to the Complainant in the year 1991 and in our view, this is a fit case where the competent authority of the GDA should recover the amount from the concerned officer/officers who were negligent in discharge of their duties.

     In the result, the Revision Petition is partly allowed and the order passed by the District Forum is modified accordingly. The GDA is directed to pay interest at the rate of 15% p.a. from 1st April, 1991 till 30th May, 2000, i.e. till the date (as contended by the GDA) of handing over possession. The order passed by the District Forum awarding costs of Rs.2,000/- is maintained.

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