The duty of the PUDA to refund earnest money to unsuccessful applicants without requiring them to complete any formalities, and the entitlement of the complainant to interest at the rate of 10% per annum from six months after the closing of the scheme up to the date when the cheque was sent.

Mr. Justice R.S. Mongia, President—This is an appeal by the Punjab Urban Planning and Development Authority (in short “PUDA”) against the judgment of the District Forum dated 19.4.2004 by which the complaint of the complainant was allowed in the following terms:

“13. In view of our discussion above, complaint is accepted and the opposite parties are directed to pay Rs. 500 as compensation for mental tension, harassment and costs of litigation and interest @ 12% per annum on the amount of Rs. 1,500 deposited as earnest money from the date of deposit till payment within one month from the receipt of the copy of the judgment. The copies of the judgment be sent to the parties free of costs. File be consigned to the record room.”

2. Brief facts are that the complainant had deposited a sum of Rs. 1,500 as earnest money for allotment of one anal of residential plot in Urban Estate, Garah Road, Jalandhar with the opposite parties. The said payment was acknowledged by the PUDA vide receipt No. 68 dated 16.6.1972. The application of the complainant was registered at Serial No. 162 of the register and the number was REO 267/GE-IK. The complainant urged that the PUDA neither informed the complainant regarding any allotment of plot nor had refunded the earnest money. The complainant had applied for the refund of earnest money on 16.12.1975 and had also sent back the original receipt. However, it was only vide registered letter dated 5.9.2002 by the PUDA that the cheque in the sum of Rs. 1,500 was sent to the complainant without any interest. The present complaint was filed before the District Forum in the year 2003 claiming interest on the refund amount. As observed above, the complaint was allowed by the District Forum in the terms mentioned above.

3. The case of the appellant was that the complainant had not asked for refund of the earnest money and after asking for the refund she was to complete certain formalities and after the formalities were completed the refund was sent. As per the PUDA Regulations if an applicant remains unsuccessful in the draw of lots the refund of the earnest money is to be made within 180 days of the close of the scheme and if the refund is made after 180 days it is to carry interest at the rate of 10% per annum. We fail to understand as to why an applicant, who has remained unsuccessful for the allotment of a plot, is to ask the refund of the earnest money. It is the duty of the PUDA to send back the earnest money if in case the applicant remains unsuccessful in the draw of lots or otherwise is not allotted a plot. No formalities are to be completed because the refund of the earnest money can always be made by way of a crossed bank draft/cheque as has been done in the present case. At least, the PUDA can write back to those applicants who have remained unsuccessful in the draw of lots that they should indicate whether they want the refund of the earnest money or they want that the money may be retained by the PUDA for consideration in any future schemes. Then it is upto the applicant to reply as to whether he wants refund or opts that the money may be retained by the PUDA for consideration in future schemes. No such letter is on the record, which may have been written by the PUDA to the complainant. The regulation regarding refund of the earnest money in case of unsuccessful applicants is as follows:

“REFUND OF EARNEST MONEY:

After the draw of lots, the unsuccessful applicants shall be refunded the earnest money within 180 days from the closing date of scheme. However, 10% interest shall be allowed from 181st day onwards in case refund is made after 180 days. In case, applicant asks for refund before the draw of lots, refund shall be allowed after deducting token amount of Rs. 500.”

4. In view of the above regulation, we are of the opinion that the District Forum was not correct in awarding 12% per annum interest and that too from the date of deposit. The complainant would be entitled to the interest at the ra