2005 (8) TMI 719 - SC - Indian Laws

Interest Rate Reduced to 15% During Stay; House Handed Over Upon Payment of Principal and Interest.

RAJASTHAN HOUSING BOARD & OTHERS Versus KRISHNA KUMARI.

The SC partially allowed the appeals, permitting the appellants to charge interest at 15% per annum on the amount due during the stay period, reducing the ... Seeking waiver of claim of interest over the arrears which remain unpaid - stay granted by the Court - Application for temporary injunction u/s 12-A - HELD THAT:- In view of the judgments in Style (Dress Land) vs. Union Territory [1999 (8) TMI 969 - SUPREME COURT], Kanoria Chemicals & Industries Ltd. vs. U.P. State Electricity Board [1997 (3) TMI 600 - SUPREME COURT], we need not dilate on the subject any more and respectfully following the dictum in these judgments, set aside the part of the order reproduced in the earlier part of this order and the appellants shall be entitled to charge interest for the period during which stay granted by the Commission was in operation. Although the amount of interest in brochure is stated to be 20% which is unconscionable in the facts and circumstances of the case, we reduce the same to15% per annum. The appellants shall be entitled to charge interest on the amount due for the period during which stay remained in operation at the rate of 15% per annum. In case the possession of the house has not been handed over to the respondent, then the appellants shall handover the possession of the house on payment of the principal amount, if any, not already paid along with interest for the period during which the stay granted by the Commission was in operation. Appeals are partly allowed with no order as to costs. Issues:1. Whether the appellants are entitled to charge interest on the amount due during the period of stay granted by the Commission.2. Whether the appellants should waive the claim of interest over the arrears due to the stay granted by the Court.3. Whether the appellants are justified in making a claim for interest over the arrears due to interim orders passed by the Court.4. Whether the appellants are entitled to charge interest for the period during which the stay granted by the Commission was in operation.5. Whether the appellants should hand over possession of the house to the respondent upon payment of the principal amount along with interest.Comprehensive Analysis:1. The appeals were filed against an order passed by the Monopolies & Restrictive Trade Practices Commission, where the respondents were directed not to pay interest on the amount due during the stay granted by the Commission. The appellants demanded an increased payment for a house allotted to the respondent, leading to a complaint under the Monopolies and Restrictive Trade Practices Act. The Commission restrained the appellants from canceling the allotment but later dismissed the complaint, stating that no restrictive trade practices were involved.2. The Court emphasized the legal maxim 'actus curiae neminem gravabit,' indicating that an act of the Court should not prejudice any party. Referring to previous judgments, the Court held that claimants who obtained a stay should not seek a waiver of interest on arrears due to the stay. The Court cited cases like Gursharan Singh vs. New Delhi Municipal Committee and highlighted the importance of not unlawfully depriving parties of their legitimate dues due to interim orders.3. Further, the Court referred to the case of State of M.P. vs. M.V.Vyavsaya & Co., emphasizing the duty of the Court to consider the balance of convenience before staying recovery of amounts legitimately due. The Court reiterated that the grant of an injunction does not relieve consumers of their obligations to pay charges at enhanced rates, and demanding surcharge/interest during such periods is not illegal.4. The Court, in line with previous judgments, set aside the part of the order where the appellants were restrained from charging interest during the stay period. The Court acknowledged that while the brochure stated a 20% interest rate, it was deemed unconscionable, and the Court reduced it to 15% per annum. The appellants were permitted to charge interest at 15% per annum on the amount due during the stay period.5. Finally, the Court directed that if possession of the house had not been handed over to the respondent, the appellants should do so upon payment of the principal amount along with interest for the period of the stay granted by the Commission. The appeals were partly allowed with no order as to costs, concluding the judgment.