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Supreme Court of India
R.V. RAVEENDRAN & A.K. PATNAIK
Haryana State Agricultural Marketing Board & Another
Versus
Raj Pal
CIVIL APPEAL NOS.1550 OF 2011 (Arising out of SLP(C)NO.12792/2009) WITH Civil Appeal No.1551 of 2011 @ SLP(C) NO.12793/2009 Civil Appeal No.1553 of 2011 @ SLP(C) NO.12799/2009 Civil Appeal No.1552 of 2011 @ SLP(C) NO.12797/2009 Civil Appeal No.1554 of 2011 @ SLP(C) NO.12795/2009 Civil Appeal No.1555 of 2011 @ SLP(C) NO.12800/2009 Civil Appeal No.1556 of 2011 @ SLP(C) NO.12801/2009 Civil Appeal No.1557 of 2011 @ SLP(C) NO.12803/2009 Civil Appeal No.1558 of 2011 @ SLP(C) NO.12805/2009 Civil Appeal
Decided on: 10-02-2011
(2009) 4 SCC 660; (2006) 4 SCC 109; (1996) 1 SCC 485 – Relied upon
Facts of the case:
The Market Committee established a New Grain Market at Karnal-Pehowa Road, Nighdu, District Karnal. It gave public notice of a scheme for the open auction of plots, booths and commercial places in the market, to be held on 13.1.1999. The said auction was governed by the Haryana State Agricultural Marketing Board (Sale of Immovable Property) Rules 1997
The respondent was the highest bidder in respect of the plot for which he gave the bid. In pursuance of it, each respondent (auction purchaser) was issued a letter of allotment on 30th January, 1999, specifying the particulars of the plot purchased by him, the auction sale price, 25% amount paid as earnest money and the particulars of the instalments of principal and interest, if the auction purchaser wanted to pay the 75% amount in six half yearly instalments as also the dates on which the instalments had to be paid.
In pursuance of the said letters of allotment, most of the allottees/auction-purchasers paid only the instalments of the auction price and did not pay the interest. Some of the allottees also committed default in paying the instalment of even the auction price. Some allottees however took possession and constructed the shops and commenced their business. Some allottees took possession and constructed merely sheds. Some allottees did not take possession at all contending that the Market Committee did not offer them possession.
The Market Committee sent Demand Notices to all the allottees on 9th July, 2007 calling upon them to pay the balance sale price and interest on the instalments at 15% per annum, as also the penal interest.
The allottees/auction purchasers approached the High Court for quashing the demand notices dated 9.7.2007.
The High Court allowed the writ petitions.
Finding of the Court:
Allottees cannot postpone the payment of instalments merely on the ground that some of the amenities were not ready. Market committee cannot charge compound interest or penal interest.
Result:
Appeal allowed in part.
Judgment :-
R.V. RAVEENDRAN, J.
1. Leave granted.
2. The first appellant is the Haryana State Agricultural Marketing Board ('Board' for short) and second appellant is the Nigdhu Market Committee ('Market Committee' for short). The Market Committee established a New Grain Market at Karnal-Pehowa Road, Nighdu, District Karnal. It gave public notice of a scheme for the open auction of plots, booths and commercial places in the market, to be held on 13.1.1999. The said auction was governed by the Haryana State Agricultural Marketing Board (Sale of Immovable Property) Rules 1997 (for short `the Rules').
3. Rule 4 of the Rules requires the auction purchaser/allottee to complete construction of a shop within two years from the date of the allotment order. Rule 5 provides that the terms and conditions governing sale will be determined by the Board from time to time. The following provisions of the Terms & Conditions of Sale (by auction), framed by the Board are relevant:
"3. One-fourth amount of the successful bid shall be required to be deposited on the spot. Failure to do so shall lead to forfeiture of the earnest money.
12. Allottees shall deposit the remaining three-fourths amount either in a lump-sum without interest within 30 days of allotment or in six equal half yearly instalments alongwith interest at 15% per annum.
13. The sale/allotment shall remain further subject to the term and conditions as enumerated in the letter of allotment."
The auction Notice also reiterated Conditions (3) and (12) extracted above.
4. The respondent in each of these appeals was the highest bidder in respect of the plot for which he gave the bid. In pursuance of it, each respondent (auction purchaser) was issued a letter of allotment on 30th January, 1999, specifying the particulars of the plot purchased by him, the auction sale price, 25% amount paid as earnest money and the particulars of the instalments of principal and interest, if the auction purchaser wanted to pay the 75% amount in six half yearly instalments as also the dates on which the instalments had to be paid. We extract below the relevant clauses of the letter of allotment which was issued to the respondent (Rajpal) in the first matter:
"2. The following particulars site is hereby allotted to you on the terms and conditions announced at the spot and mentioned hereunder:
Kind of Plot Number of Plot Area of Plot Price of Plot Name of Purchaser
Shops 108 12'x27.5' 2,55,000/- Sh.Raj Pal
3. The area and number shown above are given in the respective plan and are subject to variation of the time of actual possession.
4. The sum of Rs.63,750/- paid by you as earnest money has been adjusted in your plot account. You are, requested to remit a sum of Rs.1,91,250/-on account of 75% balance sale price either within 30 days of receipt of this allotment letter without interest or in six half yearly instalments together with interest @ 15% p.a. accruing from the date of issue of this letter as mentioned hereunder.
Number of Instalments Due date of Instalments Amount of Instalments Interest @ 15% p.a. Total Remarks
1. 1.1.2000 31875 14343.75 46218.75
2. 1.7.2000 31875 11953.10 43828.10
3. 1.1.2001 31875 9562.50 41437.50
4. 1.7.2001 31875 7171.00 39046.90
5. 1.1.2002 31875 4781.25 36656.25
6. 1.7.2002 31875 2390.65 34265.65
5. In case of failure to deposit the instalment(s) by 10th of every month due, compound interest @ 10% p.a. alongwith penal interest @ 4% p.a. with instalments shall be charged.
xxx xxx xxx
12. The transferee shall complete the building within two years from the date of issue of allotment order......... ...
xxx xxx xxx
15. The Market Committee Nigdu shall not be responsible for leveling of uneven sites."
5. In pursuance of the said letters of allotment, most of the allottees/auction-purchasers paid only the instalments of the auction price and did not pay the interest. Some of the allottees also committed default in paying the instalment of even the a
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