Content Provider | Supreme Court of India |
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e-ISSN | 30484839 |
Language | English |
Access Restriction | NDLI |
Subject Keyword | Contract: Parties bound by terms of agreement |
Content Type | Text |
Resource Type | Law Judgement |
Jurisdiction | India |
Case Type | Appeal |
Court | Supreme Court of India |
Disposal Nature | Appeal Allowed |
Headnote | Contract: Parties bound by terms of agreement - Demand for any amount due in terms of the unchallenged terms of agreement does not furnish a cause of action to approach the consumer forum - On facts, lease-cum-sale agreement executed in 1991, two years after the original date of allotment - Term of agreement was that lessee in case of default or delay in payment of instalment dues would pay interest @ 15% 0 p.a. from the date when same fell due - Lessee started paying instalments from 1991 - Development authority charged interest on the instalments amount for the period 1989-91 - Justification of - Held: Justified - Charging of interest from the original date of allotment was in accordance with the agreement Lessee not entitled to contend that the instalments should commence only prospectively Consumer Protection Act, 1986: s.2(c) - Deficiency in service - Refusal to execute sale deed by the Development Authority, ·until amount due was paid - Held: Does not amount to deficiency in service. Interest: Interest on interest - When the defaulted instalment is subjected to interest, the interest component of defaulted instalments is also subjected to interest - Charging of such interest, on the interest part of the instalment, on default in payment of the instalment, at a reasonable rate from the date of default, cannot be termed as charging of compound interest in regard to entire dues. The appellant-authority allotted MIG house to the respondent, as per letter of allotment dated 1.5.1991. A lease cum-sale agreement was entered between them on 6.5.1991. The agreement stipulated the price of the house Jo be Rs.1.39. lacs. Aft.er deducting the amount paid by the lessee towards the price (on 29.6.1990), it permitted · the.lessee to pay the balance in 52 quarterly instalments of Rs.1957/70 each commencing from 1.9.1989. The said clause gave the option to the lessee to convert the lease into a sale on completion of payment of all the instalments by paying a commitment· charge of Rs.200/-. The agreement also required the lessee to pay an annual rent of Rs.24/90 during the period of lease commencing from 1.9.1989. Clause (6) of the agreement further stipulated that in the event of default in paying any instalment or 0 other dues on the due date, the lessee would pay interest @ 15% per annum on the defaulted instalments/dues from the date when the same fell due. On execution of the Lease-cum-Sale Agreement, the respondent took possession of the house on 9.5.1991 and E commenced paying the instalments from June, 1991. He paid the last 12 instalments in a lump sum on 5.7.2001. The appellant by letter dated 1.12.2001 informed the respondent that he was still due in a sum of Rs.57,175/-. On 27 .12.2001, the respondent applied to the appellant for execution and registration of a sale deed claiming that he · had paid all the instalments. The appellant informed the respondent that until the sum which was due was paid, the sale deed would not be executed. Respondent filed complaint before District Forum which was dismissed holding that refusal to execute a sale deed until the amount ·due was paid, was not a deficiency in service. State Commission partly allowed the appeal and directed the respondent to pay Rs.20,000/- to the appellant in full and final settlement of the dues and directed the appellant to execute the sale deed on receipt of such amount. The said decision was upheld by National Commission.In appeal to this Court, appellant-authority contended that it charged interest strictly in accordance with the terms of the lease· agreement and that charging of interest @ 15% per annum on delayed instalments in terms of the agreement was not illegal. |
Judge | Hon'ble Mr. Justice R.V. Raveendran |
Neutral Citation | 2009 INSC 87 |
Petitioner | Secretary, Bhubaneswar Development Authority |
Respondent | Susanta Kumar Mishra |
SCR | [2009] 2 S.C.R. 149 |
Judgement Date | 2009-01-30 |
Case Number | 605 |
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