Case Note & Summary
The dispute arose from appeals filed by the Haryana Urban Development Authority challenging orders from the National Consumer Disputes Redressal Commission regarding interest rates on refunds. The respondent, R.S. Banga, was allotted a plot in Hisar but did not receive possession despite paying all dues. The District Forum initially directed a refund with interest at 18%, which was later reduced to 15% by the State Forum. The National Commission, however, reinstated the 18% interest rate. The Supreme Court found that the National Commission's order could not be sustained, referencing its earlier judgment in Ghaziabad Development Authority vs. Balbir Singh, which criticized the blanket application of 18% interest. The court noted that the relevant evidence was not presented, and since the appellants had already paid interest at 15%, this rate was maintained. The court directed that the respondent could take possession of the plot and if he chose not to, he must inform the appellants within two months to receive a full refund. The court clarified that this order should not serve as a precedent for future cases, emphasizing adherence to the principles established in the earlier judgment. The appeal was disposed of without costs.
Headnote
A) Consumer Protection - Interest Rates - Rate of Interest in Consumer Disputes - Consumer Protection Act, 1986, Section 14 - The court held that interest at the rate of 18% cannot be uniformly applied in all cases without considering the specific facts of each case. The court set aside the National Commission's order and maintained the State Forum's directive of 15% interest, emphasizing the need for a factual basis for compensation (Paras 1-2).
Issue of Consideration
Whether the National Commission's order to grant interest at the rate of 18% per annum was justified.
Final Decision
The Supreme Court set aside the National Commission's order for 18% interest and maintained the State Forum's directive of 15% interest, allowing the respondent to take possession of the plot or request a refund.
Law Points
- Consumer protection
- interest rates
- deficiency in service
- misfeasance in public office
- compensation for mental agony
