SITA DEVI versus BIHAR STATE HOUSING BOARD AND ORS.

Citation: [2006] SUPP. 10 S.C.R. 516 · Decided: 08-12-2006 · Supreme Court of India · Bench: S.B. SINHA, MARKANDEY KATJU · Disposal: Appeal(s) allowed

Judgment (excerpt)

A 
B 
SITA DEVI 
v. 
BIHAR STATE HOUSING BOARD AND ORS. 
DECEMBER 8, 2006 
[S.B. SINHA AND MARKANDEY KA TJU, JJ.] 
Interest-Entitlement to-Housing Scheme-Non-completion of 
construction within time-Demand for refund of entire amount by applicant-
C Cancellation of allotment thereafter-Writ Petition seeking refund of entire 
amount with interest-Refund of only 80% of the amount deducting 20<J/tr-
Deduction held not justified, and direction to refund the deducted amount 
with interest-On appeal, held: Applicant was entitled to interest on the 
entire amount and not on the deducted 20% amount alone-Bihar State 
Housing Board (Management and Disposal of Housing Estates) Regulations, 
D 1983-Sub-rule 36 Clause (3). 
Appellant had applied for a flat constructed by respondent-Board. She 
deposited the sum towards the price of the flat. When the flat was not 
constructed within stipulated and reasonable period, she filed application for 
refund of the amount. Board, after 3 months from the application for refund, 
E cancelled the allotment made in favour of the appellant. 
Appellant filed Writ Petition praying that she was entitled to refund of 
entire amount with interest on the entire amount alleging that her 
representation for refund of the entire amount was not acceded to. During 
F pend ency of the Writ Petition, a cheque refunding 80% of (deducting 20%) 
the entire amount was purported to have been issued by the Board. Single 
Judge of High Court held the deduction as not warranted and directed refund 
of the 20% deducted amount to the appellant with interest thereon. Division -
Bench of High Court upheld the order of Single Judge. 
G 
The question for consideration in the appeal was whether the appellant 
was entitled to interest on the entire amount deposited by her or only on 20% 
thereof. 
Allowing the appeal, the Court 
H 
516 
.. 
SIT A DEVI v. BIHAR ST A TE HOUSING BOARD 
517 
HELD: Respondent-Board cannot take recourse to the terms and A 
conditions of allotment or of Clause (3) of Sub-Rule 36 of the Bihar State 
Housing Board (Management and Disposal of Housing Estates) Regulation, 
1983 in the instant case. The appellant is entitled to interest at the rate allowed 
by the Single Judge on the entire amount subject to the adjustment of the 
amount already paid at the rate fixed by the High Court. (519-H; 520-A-B) 
CIVIL APPELLATE JURISDICTION : Civil Appeal No. 5927 of2006. 
From the Judgment and final Order dated 15.4.2005 of the High Court 
of Judicature at Patna in L.P.A. No. 30 l/2005. 
Manish Kumar Saran and Sujit Saurabh for the Appellant. 
Shrawan Kumar and S. Chandra Shekhar for the Respondents. 
The Judgment of the Court was delivered by 
Leave granted. 
The short question which arises, for consideration in this appeal which 
arises from the judgment and order passed by the Division Bench of the High 
Court dated 15.4.2005 in LP.A.No. 30l/2005 is as to whether the appellant 
herein is entitled to interest on the entire amount deposited by her with the 
B 
c 
D 
respondent-Board for allotment of a flat. 
E 
The respondent is a Corporation constituted under the Bihar State 
Housing Board Act. It constructs houses for allotment thereof to various 
categories of people. Appe_llant filed an application .for allotment of a flat 
constructed by the respondent-Board at Bahadurpur. Patna Under the Self 
Financing Scheme in the year 1994. He deposited a sum of Rs. 17 ,000/- on F 
13.1.1994 and the balance sum of Rs. l.54.876/-on 31.3.1994. 
The flats were not constructed within the stipulated period. They were 
not constructed within a reasonable period even thereafter. The respondent 
filed an application for refund of the amount on 29.10.1996. The respondent- G 
Board purported to have cancelled the allotment made in favour for the 
appellant on 30.1.1997. Appellant filed a writ petition before the High Court 
in May, 2000 as his representation of the appellant to the effect that the entire 
amount should be paid back her had not been acceded to. In the said writ 
Petition the following prayers were made: 
H 
518 
SUPREME COURT REPORTS [2006] SUPP. 10 S.C.R. 
A 
"(i) for direction upon the Respondents to refund petitioner's entire 
amount which she had deposited on 31.3.1994 for purchase of Flat. 
Since the physical possession of the Flat is not being given to her. 
(ii) Petitioner also prove for the direction to the respondents to pay 
interest at the rate of 18% per annum on her entire amount to be 
B 
calc

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