CASE: ARYANA URBAN DEVELOPMENT AUTHORITY V. DARSH KUMAR

Haryana Urban Development Authority V. Darsh Kumar

2002 SCC ONLINE NCDRC 10: [2002] 1 CPJ 35 NC

INTRODUCTION:

In Haryana Urban Development Authority [HUDA] v Darsh Kumar, Mr. Darsh Kumar was allotted a plot on 21.2.1990 by HUDA residential plot bearing no. 192 for rupees 1,99,400/- in police lines area, Hissar, Haryana. The immediate cost paid by Mr. Darsh was 10% of the cost of the plot i.e. rupees 19,940/- and the remaining 15% of the amount was paid by him on 22.3.1990. According to terms he was to be given the possession of plot within 30 days from the payment of 25% of the amount, however even after payment of the full amount of the plot he did not get possession of the plot. District forum on a complaint filed by the respondent held that one year was sufficient after the date of deposit of 25% of the amount for HUDA to deliver possession. It, therefore, directed the HUDA to pay respondent interest @18% per annum on the entire amount deposited by him w.e.f. 22.3.1991 till the date of offer of possession of the plot on 26.9.1994 to the allotee. Order of District Forum was challenged by HUDA before the state commission which upheld the order of District Forum.  This case was being heard before the National Consumer Dispute Redressal Commission New Delhi.

In the above-mentioned case, following acts were involved:

  • Consumer Protection Act 1986 section 14 (1)(d), 18 and 22(1)[1].
  • Haryana Urban Development Authority Act 1977.[2]
  • Contract Act 1872 section 73.[3]
  • Civil Procedure Code 1908 sections 34 and 35.[4]

This case was heard before:

  • Honorable Mr. Justice D.P. Wadhwa President
  • Honorable Mr. Justice C.L.Chaudhry Member
  • Honorable Mr. Justice J.K.Mehra Member
  • Rajyalakshmi Rao Member
  • B.K.Taimni Member

 

ISSUES:

  1. In this case, the very first issue was that if any Urban Development Authority is required to pay interest as a result of the non or delayed allotment of plots or flats or houses on the amount deposited by the allotted.
  2. If the interest was to be paid by the Authority then at what rate interest should be paid.
  3. It was also argued that up to what period interest would be payable on the account of undue delay in the allotment and delivery of possession of the plot/flat/ house.

JUDGEMENT:

The Court held that it was justified for the Haryana Urban Development Authority to pay interest @18% per annum to Mr. Darsh Kumar as the award of interest @18% per annum is quite equitable as it will take into consideration the escalation of cost of construction as well.

If the stories of woes of the common man are to be scripted by the one who shouts from the housetop of his love for common man, then in the instant case the only factor begging question is the truth. Contradiction is perhaps inherent in the system like this. This may be a window of opportunity to introduce an element of propriety on the part of the Urban Development Authorities while dealing with the common man.

The Court further added to the subject the modification that interest @18 % per annum would be allowable after two years from the date of respective deposits of the amounts, we upheld the decision of the State Commission and dismiss the revision petition.[5]

CASE COMMENTARY:

According to me the decision taken by the District Forum was justified in the case of Haryana Urban Development Authority V. Darsh Kumar because when a common man invests in buying some plot or flat or house till the time he gets the possession of it, he is stuck. He has no other place to go and have to wait for years for allotment of the plot so that he can build a house for his residence. He has deposited all of his savings with the HUDA to buy the plot. He has legitimate expectations that a plot of land will be allotted to him within a reasonable period for him to build his own house for his family. He cannot go elsewhere as his money is blocked with HUDA. He cannot even buy another piece of land cause he won’t be having much of extra money due to which he has to wait for a long time. This waiting period is some time is so much that some allotees even die till they get the possession of the plot.

When an allotee gives an application that he needs a plot of land to build a house for his residence he is not guided by any commercial consideration. So this award of interest helps him to buy a plot elsewhere if a situation arises where he is deprived of the plot he applied for. As time passes even the construction cost increases due to which it is required to pay allotee the good sum of interest so that one can compensate for the delay of allotment of plots.

CONCLUSION:

These Urban Development Authorities are setup so that they could help the common man and play a crucial role in urbanization. If these are not going to work properly then how a common can man could trust them and invest in them further endangering the growth of the country. These government organizations need to work properly and be on time so that other could not suffer because of them.

 

 

 

 

[1] http://ncdrc.nic.in/bare_acts/ConsumeProtectionAct-1986.html, accessed on 23 May 2020.

[2] https://www.huda.org.in/Urban%20Branch%20I%20Residential%20and%20Commercial/HUDA_Act_1977.pdf , accessed on 23 May 2020.

[3] http://uputd.gov.in/site/writereaddata/siteContent/indian-contract-act-1872.pdf accessed on 23 May 2020.

[4] http://legislative.gov.in/sites/default/files/A1908-05.pdf accessed on 23 May 2020.

[5] SCC ONLINE.