MAIN POINT
Auction purchaser not intending to make balance payments due is not entitled to retain possession.

JUDGMENT :

ANIL R. DAVE, J.

1. Leave granted.

2. Being aggrieved by the judgment dated 10th December, 2009 in R.S.A. No.790 of 2008 delivered by the High Court of Punjab & Haryana at Chandigarh, this appeal has been filed by the original defendant – Haryana Urban Development Authority, through its Chief Administrator.

3. The facts giving rise to the present litigation in a nutshell are as under :

The present respondent had participated in an auction conducted by the appellants for disposal of certain booths situated in Sector 9 at Panchkula and had offered the highest bid of Rs.4 lakhs for booth no.103 situated in the said sector. As he was the highest bidder, subject to the conditions of the auction, he was allotted the said booth vide Memo No.12351 dated 14th September, 1988. The respondent had deposited Rs.40,000/-, being 10% of the amount of bid, immediately and thereafter he had further deposited a sum of Rs.60,000/-so as to make 25% of the total amount offered by him.

4. The balance amount of Rs.3 lakhs was to be paid by the respondent to the appellant authorities in 10 half yearly instalments along with interest @ 10% per annum. There was a condition in the auction sale that in case of default in payment, the respondent had to pay interest @ 10% per annum on the unpaid amount and it was also open to the appellant to impose further amount of penalty and to resume possession of the booth.

5. It is an admitted fact that the respondent committed several irregularities in making payment of the remaining amount. As he did not pay the remaining instalments, he was called upon to pay the same along with interest @ 18% per annum, compounded quarterly. In the aforestated circumstances, the respondent had filed a suit challenging the validity of the action of the appellant of charging 18% compound interest and resumption of the booth.

6. It was mainly contended in the suit filed by the respondent that it was not open to the appellant to charge 18% compound interest. According to the respondent, the appellant could have charged only 10% interest on the delayed payments.

7. After considering relevant evidence, the trial court had decreed the suit, especially on the ground that it was not open to the appellant to charge 18% compound interest.

8. Being aggrieved by the final outcome of the suit, the appellant had filed first appeal, but the same had been dismissed.

9. In the aforestated circumstances, the appellant had filed Regular Second Appeal No.790 of 2008 before the High Court.

10. After considering the facts and submissions made by the learned counsel, the High Court dismissed the second appeal by observing that the appellant was entitled to charge only 10% interest and not 18% interest compounded quarterly, as demanded by the appellant.

11. The learned counsel appearing for the appellant authority had submitted that though the respondent had succeeded in the suit as well as in the first appeal and the second appeal, till the date of admission of the present appeal, the respondent had not made payment and it had also been submitted that the respondent’s bona fides were doubtful.

12. In the aforestated circumstances, so as to see whether the respondent was in fact interested in retaining the booth in question, this Court had passed an order on 17th February, 2014, directing the appellant as well as the respondent to place on record their calculations with regard to the amount payable by the respondent on the basis of interest @ 10% per annum on the unpaid instalments. In pursuance of the aforestated direction, the appellant had given a statement giving details about the amount payable by the respondent with 10% interest on the unpaid instalments. The respondent had been directed to make the payment from time to time so as to know his bona fides.

13. Finally, on 5th September, 2014, this Court had passed an order directing the respondent to pay at least Rs.13 lakhs before 10th October, 2014 and the said amount was, in fact, much l