HARYANA URBAN DEVELOPMENT AUTHORITY Vs. DARSH KUMAR

JUDGEMENT

(1.) The question 'which was before the State Commission and now before us for decision is ;

(2.) Appearing on behalf of HUDA, learned Counsel Mr. Bana and others brought to our notice three order of the Supreme Court and one order of this Commission in support of the fact that rate of interest of 18% granted by the State Commission could not be sustained before us. He drew our attention to the case of HUDA v. M.S. Lamba, SLP (Civil No. 14871 of 1994, decided by the Supreme Court on 7.11.1996 wherein rate of interest granted @ 18% was reduced to 12% on the amount deposited by Lamba-the respondent. He also referred to another order of the Supreme Court in the case of HUDA & Anr. v. K.K. Goel, SLP (Civil) No 3324/1997, decided on 24.10.1997, wherein the rate of interest was reduced from 18% to 10%. Mr. Bana then referred to : in order of this Commission in HUDA v. Krishan Lal Kalra, decided on 3.11.1998 where the interest in similar cases was reduced from 15% to 12% and finally reference was made to the order of Supreme Court passed in GDA v. Union of India, II (2000) CPJ 1 (SC)=IV (2000) SLT 654=(2000) 6 SCC 113, wherein rate of interest payable in such cases was fixed at 12%. It was submitted that at times delay in giving possession was beyond the control of HUDA and grant of interest at a higher rate will be detrimental to the interest of a public body like HUDA which is engaged in developing urban areas at no profit-no loss basis. It was thus submitted that the rate of interest needed to be kept @ 10% as per policy of HUDA.

(3.) In GDA v. Balbir Singh, Revision Petition No. 703/2001, Mr. Kulshreshta appearing for GDA submitted that GDA was engaged in construction and development activities in Ghaziabad (in the State of Uttar Pradesh) and itself was borrowing @ 16% per annum from various financial institutions for the purpose. According to him GDA works at 'no profit-no loss basis'. His argument was that for the purpose of finding out the starting point for any scheme in the Brochure it should be read as a whole. We are concerned here with the Brochure relating to Govindpuram Scheme. Mr. Kulshreshtha said that the reasoning of the State Commission to award interest @ 18% just because GDA's penal rate of interest is 18% was not correct and distinguishing the instant case from G.D.A. v. Union of India (supra), or Sovintorg (India) Ltd. v. State Bank of India, New Delhi, II (1999) CPJ 4 (SC)=VI (1999) SLT 545=(1999) 6 SCC 406, was not correct. He said the case of G.D.A. v. Union of India (supra), was a complete answer as regards the contract between the GDA and allottees and equity demands that rate of interest to be given to allottees be kept @ 12%. He also cited the case of Smt. Kaushnuma Begum & Ors. v. National Insurance Company, I (2001) SLT 300=I (2001) ACC 151 (SC)=2000 (1) SCALE page 1, wherein Supreme Court found grant of simple interest @ 12% as reasonable. Then submission of Mr. Kulshreshtha was that as a result of stay granted by Allahabad High Court on new construction in Govindpuram Scheme for the period 24.4.1991 to 16.12.1993 no interest should be payable for this period as no construction activity could be undertaken m the light of the stay granted by the High Court. He said delay occurring on this was for reasons beyond the control of GDA.