LexPUNJAB URBAN PLANNING & DEVELOPMENT AUTHORITY versus BHUPINDER SINGH
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[2008] 10 S.C.R. 958 A PUNJAB URBAN PLANNING & DEVELOPMENT B AUTHORITY v. BHUPINDER SINGH (Civil Appeal No. 7727 of 2002) JULY 14, 2008 [Al TAMAS KABIR AND DR. MUKUNDAKAM SHARMA, JJ] c Consumer Protection Act, 1986- s. 14(1)(d) - Compen- sation - Housing - Interest on earnest money - Advertise- ment for allotment of houses - Stipulation therein that interest would not be payable on earnest money - First draw of lots - Unsuccessful applicants not seeking refund of earnest money 0 - Such applicants included in second draw of lots - Unsuc- cessful applicants returned earnest money but without inter- est - Challenge to - Forums below directing the Development Authority to pay interest on earnest money deposited @ 18% p.a. from two years after date of deposit till date of payment - On appeal, held: Complainants got benefit of such retention by E participating in second draw of lots-Applicants having not asked for refund, cannot take advantage of their lapse - More so, they would have not raised the claim, had they succeeded in sec- ond draw - Thus, the Authority should not be burdened with the responsibility of non-refund of earnest money from date of de- F posit to date of filing complaint - Rate of interest reduced to 10% p.a. from date of deposit till date of actual payment. In 1989, the appellant-PUDA invited applications for allotment of Higher Income Group (Single Storey) cat- egory houses. The amount of Rs. 4000/- was to be de- G posited as earnest money. However, no interest was pay- able on its refund. The appellant received applications and draw of lots was held. Among the unsuccessful appli- cants, 1965 applicants did not seek refund of earnest money and were not returned the same. H 958 PUNJAB URBAN PLANNING & DEV. AUTHORITY 959 't· v. BHUPINDER SINGH Seven years later, PUDA formulated a Scheme for A construction of 354 Higher Income Group Houses. The notice was published in the newspaper that the applicants who applied in 1989 and had not withdrawn the earnest .. , money would be considered in draw of lots for 154 houses. 200 houses were to be offered to the fresh appli- B cants at present rates. The second draw of lots was held. The unsuccessful applicants were returned the earnest money of Rs. 4000/ deposited by them. However, no in- terest was paid on the earnest money even though it had been retained since 1989. Aggrieved, applicants filed com- c plaints before the District Forum claiming compensation from PUCA by way of interest @ 24% p. a. on the earnest money deposited by them. The complaints were allowed. PUCA was directed to pay interest on the amount depos- ited as earnest money in 1989,@ 18% p.a. for the period 0 commencing from two years after the date of deposit till the date of payment. Both the State Commission and the National Commission upheld the order. Hence the present appeal. Partly allowing the appeals, the Court E HELD: 1.1 The earnest money deposited by the re- spondents in 1989, when making applications for acquir- ing Higher Income Group (Single storey) Category Houses ,.., had not been returned to the respondents, while in other cases the same was returned to the applicants. The ex- F planation given by PUCA that such earnest money was refunded to those who had claimed such refund, but was not refunded to those who did not, is not very convinc- ing. However, it cannot be overlooked that the respon- dents did get the benefit of such retention by being per- G ~~ mitted to participate in the draw of lots held for the sec- ond time on 20.9.1996. Apart from that, there is also no explanation as to why the respondents had not asked for refund of the earnest money and allowed the same to re- main with PUCA. [Para 16] [967-H; 968-A,B & C] H ! 960 SUPREME COURT REPORTS [2008] 10 S.C.R. ._ ' 1 c'1 A 1.2 The respondents did not object to the contents of the public notice published in the "Tribune", categori- cally indicating that those applicants who had earlier ap- plied for allotment of Higher Income Group Houses and had not withdrawn the deposit of Rs.4,000/- made by them would also be included in the draw of lots scheduled to .-~ B be held on 20th September, 1996 for 154 such houses. On the other hand, the respondents allowed themselves to be included in the draw and only when they proved ~o be unsuccessful, then they moved the Consumer Forum con- c tending that they were entitled to interest oh the deposit
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