LexALOK SHANKER PANDEY versus UNION OF INDIA AND ORS.
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ALOKSHANKERPANDEY A 11. UNION OF INDIA AND ORS. FEBRUARY I5, 2007 [S.B. SINHA AND MARKANDEY KA TJU, JJ.] B Interest: Interest on interest-Installments paid for seeking allotment of flat- Flat not allotted-Claim for refund of the installments along with interest- C Respondent authority refunded amount without interest-Commission ordered payment of interest @ 12% p.a.-Appeal for higher interest-Held, in the facts of case, interest @ 12% p.a. was appropriate-However as interest was not paid along with the refund amount, respondent authority directed to pay interest at the same rate on the interest amount from the date of refand of D installments till date of payment. Appellant applied for a flat in 1994. He paid all the installments as demanded. On finding that there is no likelihood of availability of flat in the near future, he made demand of the amount paid along with interest@21% p.a. The amount was refunded to the applicant in the year 2001 without any E interest. He claimed compensation by filing an application under S.128 of Monopolies and Restrictive Trade Practices Act, 1969. The Commission held that it is a clear case of deficiency of services on the part of the respondent authority and that the appellant was not only deprived of return on his investment made with the respondent but also the possession of the flat promised to him. The Commission directed the respondent to pay 12% p.a. F interest on the installments from the dates of the payment till the date of refund. The present appeal is filed claiming interest at a higher rate. Disposing of the appeal, the Court HELD: Interest is not a penalty or punishment at all, but it is the normal G accretion on capital Equity demands that borrower should not only pay back the principal amount but also the interest thereon to the lender. There is no hard and fast rule about how much interest should be granted and it all depends on the facts and circumstances of each case. The grant of interest of 12% 737 II 738 SUPREME COURT REPORTS [2007] 2 S.C.R. A per annurn is appropriate in the facts of this particular case. However, since interest was not granted to the appellant along with the principal amount the respondent should in addition to the interest at the rate of 12% per annum also pay tO appellant interest at the same rate on the aforesaid interest from the date of payment of installments by the appellant to the respondent till the date of refund on this amount, and the entire amount must be paid to the B appellant within two months. (Para 8, 9] [740-A, B, C, DJ c Renusagar Power Co. Ltd v. General Electric Co., [1994] Suppl. l SCC 644, referred to. CIVIL APPELLATE JURISDICTION: Civil Appeal No. 1598 of2005. From the Order dated 13.9.2004 of the MRTP Commission in C.A. No. 193/2001. Parag Tripathi, Deepti Rajpal and Dr. Kailash Chand for the Appellant. D Mohan K. Parasaran, A.S.G., Ashok K. Srivastava, P. Parmeshwaran (for D.S. Mahra) Reena Singh and Neelam Singh for the Respondents. The Judgment of the Court was delivered by . MARKANDEY KAT JU, J. I. This appeal has been filed against the E order pass~d by the Monopolies and Restrictive Trade Practice Commission, New Delhi (hereinafter referred to as "the Commission") dated 13.9.2004 in C.A. !'Jo.193 of2001. 2. Heard learned counsel for the parties and perused the record. F 3. The' case of the appellant is that after applying for a flat under the "Indira Puram Housing Scheme" in-the year 1994, a reservation letter dated 30th March, 1994 was received by him and he was asked to pay seven installments on the specified dates. The amount as well as the dates on which the installments were to be paid was mentioned therein. The applicant started G paying the installments as demanded. Subsequently, he opted out for a HIG flat, which was also allotted to him vide letter dated 17th May, 1994. No additional demand was asked for in the second letter. The installments were duly paid as demanded. Thereafter, nothing was heard from the respondent side for almost five years. After finding that there is no likelihood of the flat to be made available to him in the near future, the applicant was left with no H alternative but to demand his amount paid along with interest at the rate of ALOK SHANKER PANDEY v. U.O.l. [MARKANDEY KATJU, J.] 739 21% per annum. The amount was refunded to the applicant in the year 2001 A without any interest as asked for. The appli
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