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2011 Supreme(SC) 905

2011 (6) Supreme 603
SUPREME COURT OF INDIA
R.V. Raveendran and A. K. Patnaik, JJ.
Kerala State Housing Board & Ors. — Appellants
versus
Kerala State Housing Board, Nellikode Housing Colony Allottees Assn. & Ors. — Respondents
Civil Appeal No.7835 of 2011
(Arising out of S.L.P. (C) No. 10580 of 2006)
with
Kerala State Housing Board & Anr. — Appellants
versus
K. Narayana Poduval & Ors. — Respondents
Civil Appeal No.7836 of 2011
(Arising out of S.L.P. (C) No. 21478 of 2008)
and
Kerala State Housing Board & Anr. — Appellants
versus
Smt. M. P. Meenakshi & Ors. — Respondents
Civil Appeal No.7837 of 2011
(Arising out of S.L.P. (C) No. 21817 of 2008)
Decided on : 14-9-2011

Headnote:Land Acquisition Act,1894-Acquisition of land for allotment of plots under Housing Schemes undertaken by Kerala State Housing Board - While the dispute in regard to quantum of compensation was pending, Board entered into agreements of sale with various allottees of plots of land wherein it was agreed that after finalization of price of property agreed to be sold by Board, allottee shall pay to Board together with interest at the rate of 15% per annum, difference between the tentative price fixed and the price finally fixed for the property by Board – Issue in consideration whether Board was entitled to any interest on the differential amount from the allottees for the period from 1997 till the date of service of individual account statements on the allottees- Since the purpose of stipulating rate of interest of 15% per annum was to take care of liability on the enhanced compensation provided in Act, 1894 and not to enrich Board by recovery of high rate of interest from allottees, view taken by High Court that the Board was not entitled to interest at the rate of 15% per annum on the difference between tentative price and final price after finalization of compensation and payment or deposit of enhanced compensation by the Board in the year 1997 was upheld-However, High Court was not right in taking a view that appellant-Board was not entitled to any interest for the period from date of payment or deposit of enhanced compensation in 1997 till the date of service of individual account statements on the allottees- During the period allottees retained differential amount in their hands Board lost the opportunity to utilize this for its activities, Board would be entitled to interest on differential amount at a reasonable rate -Interest at the rate of 8% per annum on such differential amount held to be reasonable, which the allottees held liable to pay to the Board-Appeals allowed to said extent (Paras 8 to 10)

       

ORDER

A. K. Patnaik, J. —

Leave granted.

2. Civil Appeal arising out of S.L.P.(C) No.10580 of 2006 is against the judgment dated 28.02.2006 in Writ Appeal No.1760 of 2004 of the Division Bench of the Kerala High Court. Civil Appeal arising out of S.L.P.(C) No.21478 of 2008 is against the order dated 13.06.2008 in Writ Appeal No.1968 of 2007 disposing of the Writ Appeal in terms of the judgment dated 28.02.2006 in Writ Appeal No.1760 of 2004. Civil Appeal arising out of S.L.P.(C) No.21817 of 2008 is against the order 13.06.2008 in Writ Appeal No.1940 of 2008 disposing of the Writ Appeal in terms of the judgment dated 28.02.2006 in Writ Appeal No.1760 of 2004. These three appeals are being disposed of by this common order as common questions of fact and law arise in the appeals.

3. The facts very briefly are that in the years 1984 and 1985 land was acquired for allotment of plots under the Chevayur Housing Scheme and the Nellikode Housing Scheme respectively undertaken by the Kerala State Housing Board (for short ‘the Board’). The landowners did not accept the compensation offered for the acquired land and sought a reference to the Civil Court under Section 18 of the Land Acquisition Act, 1894. While the dispute in regard to quantum of compensation was pending, the Board entered into agreements of sale with various allottees of the plots of land during the years 1988-1990 and made a provision therein that the Board shall be entitled to re-fix the final price of the property agreed to be sold to the allottees taking into account inter alia the enhanced compensation awarded by the Courts and Tribunals and that the decision of the Board in fixing the revised price of the property shall be conclusive and final. It was also expressly agreed in the agreements of sale that after finalization of the price of the property agreed to be sold by the Board, the allottee shall pay to the Board together with interest at the rate of 15% per annum, the difference between the tentative price fixed and the price finally fixed for the property by the Board within thirty days of the date of a registered notice demanding the payment thereof or in such quarterly installments over a period not exceeding two years to be determined by the Board. After the reference cases were finalized and disposed of in the year 1997, the Board deposited the enhanced compensation with interest, but did not promptly serve the demand notices on the allottees for payment of the difference between the tentative price and the final price with interest and it was only in the year 1999 that the Board served the notices on the allottees to pay the said difference with interest at the rate of 15% per annum.

4. The allottees then filed Writ Petitions before the Kerala High Court and the learned Single Judge passed orders refusing to interfere with the claim of interest on the enhanced amounts of compensation on the differential amount till 1997 when the references were finally disposed of by the Court and the Board deposited the enhanced compensation with interest. The learned Single Judge, however, found that individual account statements giving the relevant details and calculations of the amounts demanded had not been served on the allottees and held that this was on account of the lethargy of the officials of the Board and, therefore, the Board was not entitled to any interest on the differential amount from the allottees for the period from 1997 till the date of service of individual account statements on the allottees.

5. Aggrieved by the orders of the learned Single Judge, the Board filed Writ Appeals before the Division Bench of the Kerala High Court and by the impugned judgments and orders the Division Bench dismissed the appeals. In the impugned judgments and orders, the Division Bench of the High Court agreed with the view taken by the learned Single Judge that the Board was not entitled to claim any interest and that too at the rate of 15% per annum for the period fr






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