1. Consumer dispute — Refund of payments — Interest and compensation — Imposition of penalty to Consumer Welfare Fund. (Para 3 , 4 , 5 )
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2021 Supreme(SC) 954
SUPREME COURT OF INDIA
Uday Umesh Lalit, Hrishikesh Roy, JJ.
Shreyans Jain & Ors. - Appellants
Versus
Arijit Bhattacharyya & Ors. – Respondents
Civil Appeal No. 1097 of 2021, (Arising out of SLP (C) No. 5579 of 2021), (Arising out of SLP (C) D. No. 39616 of 2019)
Decided On : 05-04-2021
Advocates:
Advocate Appeared:
For the Petitioner: Mr. Rabin Majumder, Adv., Ms. Akansha Srivastava, Adv., Mr. Joydeep Mukherjee, AOR
For the Respondent: Mr. Sanjay Mukherjee, Adv., Ms. Komal Sorout, Adv., Mr. Rajan Kumar Singh, AOR
Advocate Appeared:
For the Petitioner: Mr. Rabin Majumder, Adv., Ms. Akansha Srivastava, Adv., Mr. Joydeep Mukherjee, AOR
For the Respondent: Mr. Sanjay Mukherjee, Adv., Ms. Komal Sorout, Adv., Mr. Rajan Kumar Singh, AOR
The Supreme Court waived a penalty imposed by the State Consumer Commission and affirmed by the National Commission, considering the specific facts and circumstances of the case and the satisfaction of the complainants' claims via payment of interest from deposited funds.
Headnote:
Appeal - Delay condoned - Leave granted - National Consumer Disputes Redressal Commission - OP Nos. 1 & 2 are jointly and severally directed to refund alongwith interest thereon @18% p.a. in favour of complainants from date of receipt of same till its full realization - OP Nos. 1 & 2 are also directed to make payment of Rs.1,00,000/- as compensation and Rs. 50,000/-as penal damages to complainants - All payments must be made within 30 days from date, otherwise amount of compensation and litigation cost shall carry interest @ 9% p.a. from this date till its realization – Held, notice was confined to question of imposition of penalty, we do not enter into question regarding rate of interest directed to be paid to respondent-original complainant - However, considering totality of circumstances, in Court view, interest of justice would stand sub-served if, from and out of amounts deposited by appellant, a sum of Rs.10 lakhs is made over to original complainants towards element of interest payable in terms of directions issued by State Commission towards satisfaction of all claims of original complainants - Rest of amount deposited by appellant shall be returned by Registry of State Commission to appellant - Appeal disposed of.
Legal Category Hierarchy
Table of Contents
2. Dispute over unpaid interest — Challenge against the imposition of penalty to the Consumer Welfare Fund. (Para 7 , 8 )
3. Notice confined to penalty imposition — Interest of justice served by redirecting deposited penalty amounts toward satisfaction of complainant's interest claims. (Para 9 , 10 )
4. Discretionary relief from penalty imposed by consumer commissions based on the totality of circumstances and satisfaction of complainant's claims. (Para 10 , 11 )
5. Penalty set aside — Deposited funds redirected to satisfy interest claims — Balance returned to appellant. (Para 10 , 11 , 13 )
6. Can a court redirect a penalty intended for a welfare fund to the complainant?
Yes, the court may redirect funds deposited as a penalty to the original complainants to satisfy interest claims if it serves the interest of justice and the totality of circumstances warrants it. (Para 10 )
7. Can the Supreme Court relieve a party of a penalty confirmed by the National Consumer Disputes Redressal Commission?
Yes, the court can relieve an appellant of a penalty imposed by the State Commission and affirmed by the National Commission based on the peculiar facts and circumstances of the case. (Para 11 )
ORDER :
1. Delay condoned.
2. Leave granted.
3. This appeal arises out of the judgment and order dated 24.01.2019 passed by the National Consumer Disputes Redressal Commission, New Delhi (‘The National Commission’, for short) in First Appeal No. 901 of 2017.
4. While disposing of Complaint Case No. CC/14/2012 preferred by respondent Nos. 1 and 2 herein, the State Consumer Disputes Redressal Commission (‘The State Commission’ for short) had directed:
"That the complaint is allowed on contest against OP Nos. 1 to 7 with cost of Rs.10,000/-to be paid by OP No.1/developer in favour of the complainants and dismissed against OP No.8 without any order as to costs.
The OP Nos. 1 & 2 are jointly and severally directed to refund Rs.5,91,150/- alongwith interest thereon @18% p.a. in favour of the complainants from the date of receipt of the same till its full realization. The OP Nos. 1 & 2 are also directed to make payment of Rs.1,00,000/- as compensation and Rs. 50,000/-as penal damages to the complainants. All the payments must be made within 30 days from date, otherwise the amount of compensation and litigation cost shall carry interest @ 9% p.a. from this date till its realisation.
The OP Nos. 1 & 2 are also directed to deposit a sum of Rs.10,00,000/-Bank draft as penalty in the State Consumer Welfare Fund of this Commission within 60 days positively in default the amount shall carry an interest @ 9% p.a.”
5. The directions stood affirmed with the dismissal of First Appeal by the National Commission, which decision is under challenge in this appeal.
6. While issuing notice, the matter was confined with regard to imposition of penalty in the sum of Rs.10 lakhs.
7. Mr. Sanjay Mukherjee, learned Advocate appearing for the original complainants, accepted that the amounts of Rs.5,91,150/-, Rs. 1,00,000/-and Rs.50,000/-as set out in the operative part of the directions issued by the State Commission have been received by his client. It is however submitted that the element of interest as awarded by the State Commission on the sum of Rs.5,91,150/-has not yet been received by his client. Mr. Mukherjee also submitted that on account of such imposition of interest, his client is entitled to a sum of Rs.10,81,670/-.
8. Mr.Rabin Majumder, learned Advocate appearing for the appellant, submitted that apart from having made over the amounts as accepted by the learned counsel for the respondent, a further sum of Rs.11,67,032/-stands deposited in the Registry of the State Commission. He further submitted that after the order issued by this Court on the last occasion, an additional sum of Rs.5 lakhs has also been deposited by his client.
9. Since notice was confined to the question of imposition of penalty, we do not enter into the question regarding rate of interest directed to be paid to the respondent-original complainant.
10. However, considering the totality of the circumstances, in our view, interest of justice would stand sub-served if, from and out of the amounts deposited by the appellant, a sum of Rs.10 lakhs is made over to the original complainants towards element of interest payable in terms of the directions issued by the State Commission towards satisfaction of all the claims of the original complainants. Rest of the amount deposited by the appellant shall be returned by the Registry of the State Commission to the appellant.
11. Insofar as the imposition of penalty is concerned, in the peculiar facts and circumstances of the instant case, we relieve the appellant of the burden of the penalty imposed by the State Commission and confirmed by the National Commission.
12. Ordered accordingly.
13. This appeal stands disposed of in the aforesaid terms.
14. No costs.
