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Checking relevance for Nedumpilli Finance Company Limited VS State of Kerala...

Checking relevance for M. P. Co-operative Bank LTD. , Jabalpur: M. P. Rajya Sahkaribank Maryadit, Bhopal: M. P. Co-operative Bank LTD. VS Addittional Commissioner Of Income Tax, M. P. , Bhopal: Commissioner Of Income Tax, Jabalpur: Addittional Commissioner Of Income Tax...

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Checking relevance for Commissioner of Income-Tax VS Henkel SPIC India Ltd. ...

Commissioner of Income-Tax VS Henkel SPIC India Ltd. - 2015 0 Supreme(SC) 1635 : Under Section 73 of the Companies Act, a promoter must keep the application (corpus) money in a separate bank account in trust for the applicants. Neither the principal nor the interest earned may be used by the company until the allotment is completed and all refundable amounts, together with any interest due for delay, are paid back. The interest that remains after such refunds belongs to the company only after the trust terminates. This establishes the promoter’s liability to keep the corpus fund separate and to refund the amount with accrued interest to the applicants (e.g., a housing society).Checking relevance for Bikram chatterji VS Union Of India...

Bikram chatterji VS Union Of India - 2019 5 Supreme 3 : The Court held that the promoter is liable to keep the buyers'''' corpus in a separate escrow account and, if the project is not completed, must refund the amount paid by the allottees along with interest and compensation as mandated under RERA (Section 11(4)(h)). The promoter was directed to open an escrow account in UCO Bank and deposit Rs.250 crore, confirming the promoter’s liability to maintain a separate fund and to refund it with interest to the housing society/allottees.Checking relevance for BIKRAM CHATTERJI VS UNION OF INDIA...

BIKRAM CHATTERJI VS UNION OF INDIA - 2018 0 Supreme(SC) 2023 : The court held that the promoter remains liable for the corpus fund and must keep it in a separate escrow account; this liability cannot be transferred to the co‑developer.Checking relevance for Commissioner Of Income Tax, A. P. VS Trustees Of H. E. H. The Nizams Family Trust: H. E. H. The Nizams Family Trust...

Checking relevance for Commissioner of Income Tax VS Prabhukunj Co-op. Housing Society Limited...

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Checking relevance for The Commissioner of Income-tax VS Henkel SPIC India Ltd. ...

The Commissioner of Income-tax VS Henkel SPIC India Ltd. - 2003 0 Supreme(Mad) 2012 : Under Section 73 of the Companies Act, a promoter (company) must keep the corpus/application money in a separate bank account and may not use it for its own purposes. If the money is to be refunded (e.g., shares are not allotted), the promoter must repay the principal together with interest accrued on the amount, the interest being payable for the period of delay beyond the statutory grace period. The interest earned remains part of the separate account and cannot be transferred to any other account until the refund is made.Checking relevance for GUJARAT STATE CO OPERATIVE LAND DEVELOPMENT BANK LIMITED VS COMMISIONER OF INCOME TAX...

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Checking relevance for Commissioner Of Income Tax, Karnataka VS Karnataka State Co-operative Apex Bank...

Checking relevance for Haryana State Cooperative Land Development Bank LTD. VS Haryana State Cooperative Land Development Banks Employees Union...

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Checking relevance for Zoroastrian Co-operative Housing Society LTD. VS District Registrar Co-operative Societies (Urban)...

Checking relevance for Kavit Ahuja VS Shipra Estate Ltd. & Jai Krishna Estate Developers Pvt. Ltd. ...

Kavit Ahuja VS Shipra Estate Ltd. & Jai Krishna Estate Developers Pvt. Ltd. - Consumer (2015) : The promoter/developer is liable to refund the amount deposited by the buyer with interest (the court held 18% per annum) when they default on delivering possession of the flats. The court held that the developer has no legal right to forfeit any part of the money deposited by the buyer.

• Liability of Promoter to Keep Corpus Fund in Separate Account and Refund with Interest
• Promoters are generally required to deposit collected amounts, specifically towards the corpus fund, into a separate interest-bearing account. The purpose is to utilize the interest accrued for maintenance and society benefits ["Eden Garden Co-Operative Housing Society Ltd. VS Mahaveer Builders - Consumer"], ["EDEN GARDEN CO-OPERATIVE HOUSING SOCIETY LTD. vs M/S. MAHAVEER BUILDERS - Consumer National"].
• It is emphasized that the corpus fund must be kept in a separate account, not mixed with other funds, and should accrue interest which is to be used for society maintenance ["Alliance Projects vs Palm Flat Owners Welfare Ass - Madras"], ["Income-tax Officer, Ward TDS-2 VS Branch Manager, State Bank of Bikaner & Jaipur - Income Tax Appellate Tribunal"].
• Promoters are liable to refund the corpus amount along with interest if they fail to transfer the fund to the society or if the fund is misappropriated or not maintained properly ["Eden Garden Co-Operative Housing Society Ltd. VS Mahaveer Builders - Consumer"], ["EDEN GARDEN CO-OPERATIVE HOUSING SOCIETY LTD. vs M/S. MAHAVEER BUILDERS - Consumer National"], ["Dhruv (A. T. T. ) Co-Op. Housing Society Ltd. VS Dhruv Constructions - Consumer"].
• In cases where the corpus fund was not deposited in interest-bearing accounts or interest was not accrued, courts have held promoters liable to pay interest and refund the amount, often with additional compensation for delay or deficiency ["EDEN GARDEN CO-OPERATIVE HOUSING SOCIETY LTD. vs M/S. MAHAVEER BUILDERS - Consumer National"], ["Oberoi Woods Co-Operative Housing Society Limited VS Oberoi Reality Limited - Consumer"].
• Promoters have a statutory obligation under laws like the PAPRA Act to refund amounts with interest if they do not deliver possession timely or if funds are misused ["EDEN GARDEN CO-OPERATIVE HOUSING SOCIETY LTD. vs M/S. MAHAVEER BUILDERS - Consumer National"], ["EDEN GARDEN CO-OPERATIVE HOUSING SOCIETY LTD. vs M/S. MAHAVEER BUILDERS - Consumer National"], ["AIR Force Naval Housing Board VS Rajiv Chopra - Consumer"].

• Courts have directed promoters to open escrow accounts for the corpus fund, and failure to do so or to transfer the fund properly results in liability to refund with interest ["Eden Garden Co-Operative Housing Society Ltd. VS Mahaveer Builders - Consumer"], ["EDEN GARDEN CO-OPERATIVE HOUSING SOCIETY LTD. vs M/S. MAHAVEER BUILDERS - Consumer National"].

• Analysis and Conclusion

• Promoters are legally bound to keep the corpus fund in a separate, interest-bearing account and to utilize the interest for society maintenance. Failure to do so, or misappropriation of the corpus, makes them liable to refund the amount along with accrued interest, often with additional compensation for delay or deficiency ["Eden Garden Co-Operative Housing Society Ltd. VS Mahaveer Builders - Consumer"], ["EDEN GARDEN CO-OPERATIVE HOUSING SOCIETY LTD. vs M/S. MAHAVEER BUILDERS - Consumer National"], ["Dhruv (A. T. T. ) Co-Op. Housing Society Ltd. VS Dhruv Constructions - Consumer"].
• The law mandates transparency and proper account management, with courts enforcing refund and interest payments when promoters default or misuse funds ["Alliance Projects vs Palm Flat Owners Welfare Ass - Madras"], ["Oberoi Woods Co-Operative Housing Society Limited VS Oberoi Reality Limited - Consumer"].
• Overall, promoters' liability includes not only depositing the corpus in a separate account but also ensuring interest accrual and timely refund if they fail to transfer or misuse the corpus fund, reinforcing accountability in promoter obligations towards society members ["Eden Garden Co-Operative Housing Society Ltd. VS Mahaveer Builders - Consumer"], ["EDEN GARDEN CO-OPERATIVE HOUSING SOCIETY LTD. vs M/S. MAHAVEER BUILDERS - Consumer National"].