Refund Interest Rate: Chandigarh District Commission Holds DDA Liable For Deficiency In Service And Unfair Trade Practices

The Commission held DDA liable for deficiency in service and unfair trade practices for not refunding the interest rate as due. It directed it to pay interest at a rate of 10% per annum on the amount of Rs. 7,63,398/- from the date of the deposit until its refund date and compensate the complainant with an amount of Rs. 25,000/- for both mental agony and litigation costs.

Brief Facts:

The Complainant deposited Rs. 4,500/- with DDA in 1979 for a housing scheme and received an allotment letter. Later, an amount of Rs. 7,58,000/- along with a loan from IDBI Bank and an additional Rs. 20,000/- by cheque was deposited. The Complainant also paid an interest of Rs. 5,03,514/- on the loan amount of Rs. 8,17,670/- until 2013. In January 2013, the Complainant informed the DDA about fulfilling all requirements, including submitting necessary documents and paying Rs. 99,600/- for collector stamps.

However, the DDA issued a notice in June 2006 stating that the complainant was ineligible for a DDA flat as they had been allotted a flat in a different housing scheme. This scheme, involving the IFCI Cooperative Housing Society in Dwarka, was formulated much later than 1979 and completed in 1999. The complainant claimed of being unaware and that DDA didn't inform or return their payment of Rs. 7,82,951/-. The Complainant requested a refund and eventually received Rs. 7,63,398/- but without any interest.

The Complainant asserted the right to interest on the retained amount and sought the return of stamps through several letters, but the DDA did not respond. Due to this, the complainant filed a consumer complaint.

Contentions of DDA:

DDA stated that the complainant was allotted a flat in a specific sector in Dwarka in December 2001. The DDA accused the complainant of withholding information that they were already allotted a flat, IFCI CGHS Ltd., through a draw in November 1999, and that he had submitted a false affidavit in 2002 denying ownership of another residential house in Delhi. This led to the issuance of a Show Cause Notice in June 2006. The DDA mentioned that the complainant had filed a previous consumer complaint in 2018, which he withdrew in August 2022.

DDA argued that the Complainant's false affidavit amounted to a serious criminal offense and claimed that there was no deficiency in their service. He acknowledged issuing a refund of Rs. 7,63,398/- on humanitarian grounds but denied the complainant's request for interest on the retained amount.

Observations of the Commission:

The District Commission allowed the complaint and observed DDA’s contention that the complainant concealed the fact that the complainant already owned a flat in Delhi through DDA. It highlighted that once the allocation was annulled, and the refund was made, the accrued interest on that amount should have also been returned. DDA has gained monetary benefits by wrongfully utilizing the complainant's funds from 2002 to 2017.

The Commission, further, held that the actions of the DDA, a government institution, cannot be permitted to profit at the expense of an ordinary consumer. It also highlighted that the complainant's request for a refund of the expenses incurred on stamp paper is not valid since DDA already returned the stamp papers for the purpose of obtaining a refund on the stamp duty and thus, it was the complainant's responsibility to seek a refund of the stamp duty expenses from the relevant authority from which they were initially acquired, once it was returned to the complainant in its their original state.

The Commission, in conclusion, held DDA liable for deficiency in service and unfair trade practices and directed it to pay interest at a rate of 10% per annum on the amount of Rs. 7,63,398/- from the date of the deposit until its refund date and compensate the complainant with an amount of Rs. 25,000/- for both mental agony and litigation costs.

Case Title: Vidya Shankar Pandey vs. Delhi Development Authority

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