The Commissioner vs. Smt. Daya Sharma W/O Shri Bholashankar Sharma

Held

The Court held that the Rajasthan Housing Board was not justified in demanding interest on due monthly installments from the respondent. The office order dated 19.02.2018 clearly stipulated that interest and penalty would not be recovered from allottees of Housing Board schemes (EWS/LIG/MIG) allotted prior to 01.01.2001. Since the respondent was allotted a house under the MIG scheme in 1982, the demand for interest amounting to Rs. 7,16,105 was contrary to this order. The Court found no merit in the appellants' arguments that the interest could only be waived if an amount was due, as the office order provided a specific exemption. The learned Single Judge was therefore correct in holding the interest demand unjustifed and that the amount of interest was liable to be refunded to the respondent. The Court also found no dispute regarding the imposition of interest at 18% per annum and upheld the Single Judge's direction for refund along with interest at that rate. The appeal was dismissed.

Facts

The Rajasthan Housing Board (appellants) issued a demand notice dated 21.02.2018 to Smt. Daya Sharma (respondent No.1) for a total amount of Rs. 32,30,567, which included Rs. 7,16,105 as interest on due monthly installments. Respondent No.1 had been allotted a house under the MIG scheme in 1982. The appellants had withheld information about an office order dated 19.02.2018, which stipulated that interest and penalty would not be recovered from allottees of Housing Board schemes (EWS/LIG/MIG) allotted prior to 01.01.2001. Respondent No.1 filed a writ petition challenging the demand, particularly the interest component. The learned Single Judge allowed the writ petition, holding the interest demand unjustified and directing its refund with interest at 18% per annum. The appellants filed a Special Appeal (Writ) against this order.

Key Issues

1. Whether the Rajasthan Housing Board was justified in demanding interest on due monthly installments from the respondent, an allottee under the MIG scheme, in light of the office order dated 19.02.2018? (Question of law) Contentions: Petitioner (Appellants): The demand for interest could only be waived if some amount was due against the allottee. The learned Single Judge erred in allowing the writ petition, and the rate of interest (18% per annum) imposed was on a much higher side without proper explanation. Respondent (Respondent No.1): As per Annexure-1, the interest calculated was Rs. 7,16,105, which was liable to be waived in terms of the office order dated 19.02.2018. The appellants had withheld information regarding this order when issuing the demand notice. The respondent was allotted a house under the MIG scheme in 1982, making the interest recovery unjustified.