HREAT = The Decree Holder is Entitled to Get the Interest for the period of Date of Expected Payment till the Actual Payment of Amount.

HREAT = The Decree Holder is Entitled to Get the Interest for the period of Date of Expected Payment till the Actual Payment of Amount.

Hari Ballabh Sharma V/s Pareena Infrastructure Private Limited

Haryana Real Estate Appellate Tribual

Appeal No.133 of 2023

Date of Decision:  30.11.2023 

Fact of the Case :-

• In 2015 ,The appellant/allottee paid booking amount to the respondent/promoter for booking of a flat under Affordable Housing Policy” of Government of Haryana.
• on June 23, 2016 the appellant/allottee was allotted a flat in draw of lots.
• The total cost of the Flat was supposed to be Rs.17,49,330/- 
• on 19.07.2016 an ‘Apartment Buyer’s Agreement’ was executed between the parties.
• till May, 2018 The appellant/allottee made a total payment of Rs.15,70,537/-. 
• On 23.10.2018 The appellant/allottee through email and letter requested the respondent/promoter to cancel his booking after deduction of earnest money of Rs.25,000/- as per AH Policy and sought refund of the remaining amount.
• The respondent/promoter did not refund the money.

• Aggrieved with the above, the appellant/allottee filed the Original complaint number 26 of 2019 seeking relief of refund.

• On 02.04.2019 , the learned HRERA GURUGRAM Authority passed the Order of refund in favour of the appellant/allottee.

• the respondent/promoter paid the payment after 2 years in March 2021 did not pay any interest for the period it delayed the payment. 

• Aggrieved with the above, the appellant/allottee filed Execution complaint no.CR/3701/2021.

• On 05.01.2023 The said complaint was dismissed by Adjudicating Officer stating that the Decree is fully compiled.

Submissions by Appellant:-

• The appellant/allottee is aggrieved of the fact that the respondent/promoter did not make the payment to him as per the order of the Authority and forced him to file execution petition.
• The appellant contends that he is entitled to interest for the period of delay in payment of refund of Rs. 15,70,537/- from the date of the Authority's order (April 2, 2019) until March 2021, spanning two years @ 10% per annum which comes out to Rs. 3,14,107/-.

Observations made by the Hon’ble Court:-

• we deem it fit to grant interest to the appellant/allottee for the unjust delay in releasing the payment till March, 2021.
• the plea of the appellant/allottee for grant of interest of Rs. 3,14,107/- for the delay in payment beyond 90 days period till March, 2021 is legal and bonafide.

Court’s Order:-

• the said amount be paid to the appellant/allottee forthwith without any further delay.

The interest provided in proviso to section 18(1) of the Act is the return for his money used by the promoter

 In the Matter of M/s Apex Buildwell Pvt. Ltd. V/s Sachin Kumar,Appeal No.240 of 2019 decided on 09.02.2021 before THE HARYANA REAL ESTATE APPELLATE TRIBUNAL it was held that

“the interest is a premium paid for the use of money. Ordinarily a person who is deprived of his money to which he is legitimately entitled as of right is entitled to interest for the period his money is used by the other person.”

it was also held that

“the interest provided in proviso to section 18(1) of the Act is an interest simplicitor which is available to an allottee who does not intent to withdraw from the project as a return for his money used by the promoter, who caused delay in the delivery of the possession. Thus, the interest for delayed possession cannot be construed to be the compensation in strict sense to fall within the purview of Sections 71 and 72 of the Act read with rule 29 of the Rules.”

NCDRC - The Developer having received the sales consideration Cannot Charge Holding charges from the Allottee for the delay in taking possession.

 In the Matter of Capital Greens Flat Buyer Association & Ors. Vs. DLF Universal Limited & Anr Complaint no.Consumer case no. CC/2047/2016 decided on 03.01.2020 before National Consumer Disputes Redressal Commission

The NCDRC Observed that

36. ………………...As far as holding charges are concerned, The Developer having received the sales consideration has nothing to lose by holding possession of the allotted flat except that it would be required to maintain the apartment.Therefore the holding charges will not be payable to the developer. Even in a case where the Possession has been delayed on account of the allottee having not paid the entire sale consideration, the developer shall not be entitled to any holding charges though it would be entitled to interest for the period the payment is delayed.

in Civil Appeal CA 3864-3889/2020 Order dated 14.12.2020 the Supreme court has Upheld all directions of NCDRC except two 

(i) The compensation on account of delay in handing over possession of the flats to the flat buyers is reduced from 7% to 6%; and

(ii) The direction for the refund of parking charges and club charges and interest on these two components shall stand set aside.

Supreme Court - Subsequent buyers are entitled to receive interest only after the date of endorsement in their favour.

 In the Matter of Haryana Urban Development Authority Vs. Diwan Singh Complaint no. Civil Appeal no. 3409 of 2003 // (2010) 14 SCC 770 decided on 23.10.2008 before Supreme Court of India

Fact of the Case.

• Plot No. 2163P in Sector 13, Bhiwani was allotted by the Appellant in the year 1990

• on the request of the original allottee, it was re-allotted to the respondent by the appellant on 21.4.1998

• In the year 1999, respondent approached the District Consumer Disputes Redressal Forum, Bhiwani, alleging that in spite of payment of the full price, the appellant had failed to deliver possession, on account of non-completion of development

• He therefore sought three reliefs. 

• First, a direction to the appellant to pay interest at 24% per annum on the amounts deposited, till the date of delivery of possession (after removing the road laid over a part of the plot). 

• Second was for a direction to the appellant not to charge any extension fee after 1994 or any interest on the extension fee. 

• Third was for payment of compensation of Rs.1,00,000/ for harassment and suffering

• The appellant resisted the claim on several grounds and also alleged that it had offered possession in 1994 and again in May 1998

• The District Forum by its order dated 10.8.1999 accepted the contention of the respondent that there was no effective offer of delivery of possession in May 1998 and awarded interest at 18% per annum on the amounts deposited, with effect from the date commencing on the expiry of two years from the date of deposit, till date of fresh offer of possession with a further direction to the appellant not to charge interest on the extension fee. The prayer for compensation for suffering/mental agony was rejected.  

• The appeal filed by the appellant was dismissed by the State Consumer Disputes Redressal Commission on 21.9.1999 by a nonspeaking order on the ground that there was no merit in the appeal.

• The appellant challenged the order of the State Commission in a Revision filed before the National Consumer Disputes Redressal Commission.

• The National Commission by a non-speaking order dated 27.8.2002 disposed of the Revision Petition in terms of its decision in HUDA v. Darsh Kumar (Revision petition No. 1197 of 1998) wherein it has upheld the award of interest even at 18% per annum.

Order of the Supreme court

• One significant aspect to be noticed is that respondent is not the allottee who was allotted the plot in 1990, but a re-allottee who was re-allotted the plot in April 1998. When he was offered possession of the plot in May 1998, he found that a part of it was used for road purposes of road. Thereafter, the appellant even offered an alternative plot. The respondent however rushed to the District Forum in 1999, hardly within a year of re-allotment.

•  A re-allottee in 1998 cannot obviously be awarded interest from 1992 on the amounts paid by the original allottee in 1990 on the ground that the original allottee was not offered delivery in 1990.

x

Provisions of the RERA Act will prevail over the terms of the agreement for sale between Allottee and Developer.

 In the Matter of Sundeep Anand and Ors. vs. Kul Developers Private Limited and Anr. Complaint no. CC005000000022985 decided on 11.11.2019 before Maharashtra Real Estate Regulatory Authority

Laying down the controversy at rest, MahaRERA held that the provisions of the Act will prevail over the terms of the agreement for sale. 

In this case, MahaRERA was to determine whether the allottee would be entitled to get interest as provided under the Act or as per the agreement between the parties. MahaRERA observed that “The Act is a special enactment for protecting the interest of the allottees with a view to complete the project in a specific timeline. There is no phraseology such as ‘unless agreed to the contrary under Section 18’ which allows the terms of the agreement to prevail over the provisions of the Act.” MahaRERA held that interest is to be awarded at the rate as prescribed by the statute for the delayed possession.