M/S SUNEJA TOWERS PRIVATE LIMITED & ANR. versus ANITA MERCHANT

Citation: [2023] 5 S.C.R. 1092 · Decided: 18-04-2023 · Supreme Court of India · Bench: DINESH MAHESHWARI · Disposal: Appeal(s) allowed

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Judgment (excerpt)

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1092
SUPREME COURT REPORTS
[2023] 5 S.C.R.
   [2023] 5 S.C.R. 1092
1092
M/S SUNEJA TOWERS PRIVATE LIMITED & ANR.
v.
ANITA MERCHANT
(Civil Appeal Nos. 2892–2894 of 2023)
APRIL 18, 2023
[DINESH MAHESHWARI AND SANJAY KUMAR, JJ.]
Consumer Protection Act 1986 : s. 14(1)(d) – Award of
compound interest by Consumer Fora – Justification of – On facts,
consumer complaints by the complainant-respondent alleging
deficiency of service on the part of the appellants-builder for having
failed to deliver the possession of three flats booked by her, even
after expiry of the agreed period and despite the fact that she had
admittedly made payment of 60% of the total sale consideration –
Dismissed by the District Forum – However, the State Commission
awarded compound interest in favor of the respondent @ 14 %,
relying upon Dr. Manjeet Kaur Monga’s case – National Commission
upheld the same – On appeal, held: State Commission and the
National Commission passed rather assumptive orders on the basis
of the decision in Dr. Monga that compound interest was required to
be allowed – Various factors recounted on behalf of the respondent,
including excessive harassment and denial of the fruits of her
investment could all lead to a reasonable amount of compensation
but, there appears absolutely no reason that compound interest be
allowed in this matter – Award of compound interest had neither
any foundation in the record nor any backing in law nor the
Consumer Fora took care to examine the contours of their jurisdiction
and the requirements of proper assessment, if at all any compensation
and/or punitive damages were sought to be granted – Awarding of
compound interest with reference to Dr. Monga’s case and without
examining any other factor has led to serious inconsistencies; and
if the award as made is approved, it could only lead to unjust
enrichment of the respondent in the name of disgorgement of benefits
purportedly derived by the appellants – Thus, the impugned orders
cannot be sustained and is set aside – However, the respondent
allowed to retain the sum of money already received by her only
because of peculiar circumstances of this case.
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1093
Judgment/order : Precedent – Ascertainment of – Held:
Judgment is an authority only in regard to its ratio which is required
to be discerned – Decision cannot be regarded as an authority in
regard to its conclusion alone or even in relation to what could be
deduced therefrom.
Allowing the appeal, the Court
HELD: 1.1 Keeping the principles in Sanjay Singh’s case
in view and for what has been discussed in regard to ratio
decidendi of the decision in Dr. Manjeet Kaur Monga’s case, it is
but clear that the said decision cannot be read in support of the
principle that compensation and/or punitive damages in terms of
the Consumer Protection Act, 1986 could also be by way of
compound interest. The State Commission awarded compound
interest, and National Commission approved such awarding of
compound interest to the present respondent, only with reference
to the said decision in the case of Dr. Monga. The ratio decidendi
of Dr. Monga is not leading to the enunciation in favour of awarding
compensation and/or punitive damages by way of compound
interest, the substratum of the orders impugned is knocked to
the ground. [Para 18][1142-F-H]
1.2 In certain eventualities, the legislature has indeed
specified the award of compound interest. Mostly, it has been
provided so in relation to any monetary involvement having the
trappings of public interests in it. The Consumer Protection Act,
1986, on the other hand, being a beneficial legislation, inter alia,
empowers the Consumer Fora to direct payment of such amount
as may be awarded as compensation to the consumer for any loss
or injury suffered due to the negligence of the opposite party.
The proviso added to Clause (d) of Section 14(1) of the 1986 Act
empowers the Forum to grant punitive damages in such
circumstances as it deems fit. That being the position, it cannot
be laid down in absolute terms that for no such stipulation
regarding compound interest being available in the 1986 Act,
the same can never be granted by the Consumer Fora. When the
matter is being considered for award of compensation and/or
punitive damages, want of stipulation in the contract as regards
award of compound or simple interest, cannot be decisive of the
matter. [Para 20][1143-E-G]
M/S SUNEJA TOWERS PRIVATE LIMITED & ANR. v. ANITA
MERCHANT
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