Indian Co-Operative House Building Society Ltd vs Deepak Jain

This revision petition has been filed by the petitioner, Indian Co-operative House Building Society Ltd. against the order dated 20.4.2017 passed by the State Commission, UT Chandigarh in FA No.341 of 2016.

Brief facts of the case are that the respondent had paid Rs.5,62,500/- to the petitioner -society of which the respondent is a member for allotting the plot, however, the plot could not be allotted and finally an offer of flat was given which was not accepted by the respondent/complainant. The complainant filed consumer complaint no.621/2015 before the District Forum wherein the District Forum allowed refund of the amount of Rs.5,62,500/- alongwith interest @ 12% p.a. alongwith Rs.1 lakh as compensation and Rs.11,000/- towards litigation cost, failing which interest shall be paid @ 18% p.a. on the aforesaid amount. The petitioner preferred an appeal bearing FA No.341 of 2016 before the State Commission and the State Commission upheld the order of refund by the District Forum, however reduced the compensation from Rs.1 lakh to Rs.50,000/-.

Hence, the present revision petition

Heard the learned counsel for the parties. Learned counsel for the petitioner states that respondent is a member of the petitioner society and by way of this complaint, he is suing himself. He further states that a cooperative society has to earn from its members only and interest awarded will have to be taken from the members of the society. Accordingly, the cooperative society has already agreed to refund the amount paid by the member without any interest.

On the other hand, learned counsel for the respondent stated that the money has been kept with the petitioner society for more than 3 years and therefore, he is entitled to get the interest on the amount of refund. The State Commission has reduced the compensation from Rs.1 lakh to Rs.50,000/-. Now, there is no justification to further reduce the rate of interest or the amount of compensation.

I have given a thoughtful consideration to the arguments advanced by both the learned counsel for the parties and have perused the record. First of all it is to be seen whether the complainant is entitled to any interest. Hon'ble Supreme Court in Alok Shanker Pandey Vs. Union of India & Ors., II (2007) CPJ 3 (SC), has held the following:

"9. It may be mentioned that there is misconception about interest. Interest is not a penalty or punishment at all, but it is the normal accretion on capital. For example if A had to pay B a certain amount, say 10 years ago, but he offers that amount to him today, then he has pocketed the interest on the principal amount. Had A paid that amount to B 10 years ago, B would have invested that amount somewhere and earned interest thereon, but instead of that A has kept that amount with himself and earned interest on it for this period. Hence equity demands that A should not only pay back the principal amount but also the interest thereon to B."

As the money remained with the petitioner society for some time, so the petitioner society is liable to pay interest. The Hon'ble Supreme Court in recent case, "Kolkata West International City Pvt. Ltd. Vs. Dev Asis Rudra, II (2019) CPJ 29 (SC)" has reduced the interest of 12% p.a. awarded by this Commission to 9% p.a. and therefore, in the present case, ends of justice would meet if the amount is refunded by the petitioner alongwith interest @ 9% p.a. It is also now settled that if the compensation is awarded in the form of interest, separate compensation should not be awarded. Accordingly, the order of the State Commission awarding compensation of Rs.50,000/- is set aside.

Based on the above discussion, RP No. 2153 of 2017 is partly allowed and petitioner is directed to refund the paid amount of Rs.5,62,500/- alongwith interest @ 9% p.a. from the date of deposit till actual payment. The order of the State Commission awarding compensation of Rs.50,000/- is set aside. The cost of litigation of Rs.11,000/- awarded by the fora below is upheld.