Case Note & Summary
The dispute arose from the appellant's purchase of SCO Site No.130-131 in Chandigarh through an auction in 1987, where he paid 25% of the premium but failed to pay the remaining amount by 1990, leading to the cancellation of the lease. The appellant challenged the demand for interest at 24% on delayed payments, arguing that the original rate was 12%. The Punjab and Haryana High Court dismissed his writ petition, prompting the appeal to the Supreme Court. The appellant contended that he had deposited all dues, including interest at the lower rate, while the respondents argued that the appellant had delayed payments on flimsy grounds and had benefited from the property without full payment. The Supreme Court noted that the interest rate had been raised to 24% following an amendment in the rules and upheld this rate for payments due after the amendment. The court dismissed the appeal but granted the appellant six weeks to pay the difference in interest, emphasizing the need for compliance with the revised terms.
Headnote
A) Property Law - Leasehold Interest - Rate of Interest on Delayed Payment - Chandigarh Leasehold of Sites and Buildings Rules, 1973, Rule 12(3) - The appellant contested the imposition of interest at 24% on delayed payments, arguing it should be 12% as per the original terms. The court upheld the revised interest rate as per the amended rules, allowing the appellant time to pay the difference (Paras 1-2).
Issue of Consideration
Whether the appellant was liable to pay interest at the rate of 24% on delayed payment of instalments as upheld by the revisional authority.
Final Decision
The Supreme Court dismissed the appeal with costs but allowed the appellant six weeks to deposit the balance amount of difference in interest at 24% as per the demand of the respondents.
Law Points
- Interest on delayed payment
- leasehold property
- revision authority
- penalty reduction
- auction purchase
