BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT
DATED: 15/07/2011
CORAM
THE HONOURABLE MR.JUSTICE R.SUDHAKAR
W.P.(MD)No.5980 of 2011
W.P.(MD)No.5981 to 6003 of 2011
and
M.P(MD)Nos.1 of 2011 (in all petitions)
W.P.(MD)No.5980 of 2011:
S.Paramasivan ... Petitioner
Vs.
1.State of Tamil Nadu,
represented by its
Secretary to Government,
Housing Unit and Urban Development
Department, Fort St.George,
Chennai - 600 009.
2.The Chairman and Managing Director,
Tamil Nadu Housing Board,
Nandanam,
Chennai - 600 009.
3.The Executive Engineer and
Administrative Officer,
Tamil Nadu Housing Board,
Tirunelveli Housing Unit,
Sivanthipatty Road,
Tirunelveli - 627 011. ... Respondents
Petition filed under Article 226 of the Constitution of India praying for
the issuance of a writ of Certiorarified Mandamus to call for the records
pertaining to the impugned demand notice in Letter No.R4/VMC/11 dated 13.03.2011
on the file of the respondent No.3 and quash the same as illegal and
consequently, direct the respondent No.3 to calculate interest on difference in
land cost between the original tentative land cost and the final land cost from
the date of finalisation of land cost i.e. 13.03.2011.
!For Petitioner ... Mr.T.Lajapathi Roy
^For Respondents... Mr.M.Govindan,
Special Govt. Pleader for R.1
Mr.A.Kannan for R.2 and R.3
* * * * *
:COMMON ORDER
W.P(MD)Nos.5980 to 6003 of 2011 have been filed to call for the records
pertaining to the impugned demand notice in Letter No.R4/VMC/11 dated 13.03.2011
and 10.03.2011 in respective cases, on the file of the respondent No.3 and quash
the same as illegal and consequently, direct the respondent No.3 to calculate
interest on difference in land cost between the original tentative land cost and
the final land cost from the date of finalisation of land cost i.e. 13.03.2011
and 10.03.2011 respectively.
2. The petitioners in all these cases are allottees of the houses in
V.M.Chatram Scheme at Tirunelveli. The allotments were made during the period
1996 - 1998 on payment of the tentative cost which includes land cost. There
was an agreement between the petitioners - allottees and the respondent Housing
Board that they have to pay the final land cost as may be determined by the
respondent Housing Board at the appropriate time together with interest as
agreed upon.
3. The land which was acquired to promote the scheme was the subject
matter of proceedings for enhancement of compensation by the original land
owners and therefore, the finalisation of the tentative cost got postponed for
long number of years.
4. Thereafter, on 13.03.2011, the respondent Housing Board issued a notice
to the petitioner in W.P.(MD)No.7430 of 2011 and the same reads as follows:
Lr.No.R4/VMC/11 Dated:13.03.2011
Account No:- 6709000002
To
Thiru/Tmt.GANESAN S A
House No.2 Type MIG
TNHB colony, V.M.Chatram, St.III, Ph.I,
Tirunelveli.
Sir/Madam,
Sub:- TNHB - Tirunelveli Housing Unit - V.M.C.PH1-ST1-3- Outstanding
dues - Intimation - Regarding.
Ref:- G.O.Ms.No.37 Hg&UD Dep.
Dated 14-02-2011
1) I wish to inform that the house No.MIG - 2 at V.M.C.PH1-ST1-3 has been
allotted to you on 7/24/1998. The Government of Tamilnadu has given interest
relief on some heads based on the recommendations of the High Level committee as
per the G.O.Ms.No.37 dated 14-02-2011. The Final land cost of the scheme is now
finalized.
2) Accordingly, the computer generated outstanding dues statement for the
house is shown below.
Demand (As per the G.O.37) Collection
Tentative Cost 282800 Lumpsum 0
Interest 96212 Monthly 0
Installment
Penal Interest Penal Interest 0
MC 5400 MC 360
Interest (ID) 0 Initial Deposit 0
Capitalisation 0 Balance cost 292718
Interest 0 Land Cost 0
Difference in 99870 Capitalisation 0
land cost
Interest 140304
Balance cost 0
Interest
Total 624586 Total 293078
Oustanding dues 331508
3) You are requested to remit the above said amount of Rs.331508/- based
on the G.O., on or before 31-03-2011.
4) You are informed that the above dues should be paid in one lumpsum
within four months from the date of issue of G.O. This relief will not be
extended if you have not paid the dues on or before 13-06-2011.
5) If any discrepancy over the statement, please come over to this office
along with original receipts and meet the undersigned during the working days
for reconciliation.
6) Please avail this opportunity and settle the dues and collect the sale
deed.
Sd/K.Arumugam,
Exe.Engr&Admn.Officer.
/Forwarded by order/
Asst.Revenue Officer."
*******
5. The similar notices were issued to all the allottees either on
10.03.2011 or on 13.03.2011 and the writ petitions have been filed challenging
the demand notices of the third respondent primarily contending that the
interest calculated and demanded by the respondent Housing Board on the
difference in land cost should be based on the date when the final land cost was
determined and not from the earlier date, arbitrarily fixed by the respondent
Housing Board. In other words, the interest should be calculated on and from
the date when the final land cost was actually determined by the respondent
Housing Board i.e. 10.03.2011 or on 13.03.2011 respectively, the date of the
impugned notice in each case and not from the earlier date. Consequently, the
petitioners will have to pay lesser amount on account of interest on
differential land cost.
6. In this regard, the petitioners rely upon the decision of the Division
Bench of this Court in V.Muralidharan v. State of Tamil Nadu reported in 2007
Writ L.R. 710, more particularly to the findings in paragraphs 21 and 25, which
read as follows:
“21. The question now to be decided is what is the period from which
interest is payable both in respect of final land cost and capitalisation
charge. As for the period from which interest can be claimed is concerned, the
final determination of land cost was made on 21.5.2004 with effect from
31.12.2000 as per Board’s resolution and it is agreeable to the writ
petitioners/allottees. When the demand was made in March, 2001, the final land
cost did not reach a finality. It came up for further consideration before the
authorities from time to time and only before the Lok Adalat, the parties came
to an almost near agreement on the final cost. Even thereafter respondents did
not approve and finalise the land cost and it is only pursuant to the Board’s
resolution dated 21.5.2004, the final land cost was determined by the respondent
and demand notices have been issued from June, 2004. The tenor of the notice
dated 10.6.2004 clearly states that the land cost and capitalisation cost should
be paid within a particular date, failing which interest will be calculated. It
is, therefore, clear that the demand itself is prospective. The respondents
wanted to conclude the issue only after the Board’s resolution and such decision
has been communicated in June, 2004 and thereafter. Therefore, the liability of
the allottees to pay interest would arise only in default of payment of the
amount as demanded by the respondents in June, 2004 pursuant to the Board’s
resolution dated 21.5.2004. So, the Department cannot charge interest from the
date of allotment. Eventhough logically interest should be charged depending
upon the date of service of notice, in order to avoid any unnecessary confusion
and complication in such matter, on the basis of the fair concession made by the
counsel appearing for the petitioners/allottees to the effect that interest can
be charged from the date of Board’s resolution dated 21.5.2004, we make it clear
that interest on the revised land cost as well as capitalisation charges would
be payable with effect from 21.5.2004. As already indicated the counsel
appearing for the petitioners have fairly conceded that interest can be charged
from 21.5.2004. Therefore, the allottees are liable to pay the interest on and
from 21.5.2004.
****
25. In the result, all the writ petitions are disposed of with the
following directions:-
(a) The petitioners/allottees will pay the final land cost at the rate of
Rs.3,49,100/- per ground with 5% nominal profit. The actual amount determined
by the respondents in respect of each allottee shall be paid together with
interest as per the rate set out in the agreement from 21.5.2004 till date of
payment.
(b) The capitalisation charges will be determined for the period from the
date when flat or house was made ready for occupation till date of allotment for
occupation and such amount will be indicated separately. The interest on such
amount will be payable from 21.5.2004.
(c) If the respondents have not intimated the petitioners/allottees about
the capitalisation charges so far, it is open to the respondents to specify the
amount as stated in clause (b) and demand the same with interest from 21.5.2004.
On complying with the above directions and satisfying any other
requirement as per law, the petitioners/allottees, who have prayed for execution
of sale deeds in their favour, are entitled to get the sale deeds executed. No
costs.
At the time of pronouncement of the order, at request of the learned
counsel appearing for the petitioners and also Mr.D.Verasekaran, learned counsel
appearing for the Housing Board, there will be a further direction that the
final determination will be done by the Housing Board within a period of six
weeks from the date of receipt of a copy of this order.”
7. The learned Counsel for the petitioners further relied upon the order
of the Honourable Supreme Court in Civil Appeal No.1805 of 2007 dated 02.09.2008
in V.Muralidharan’s case referred to above, to state that the date on which the
Board resolved to determine the final cost should be taken as a relevant date in
this case also.
8. The third respondent, on notice, filed a counter affidavit common for
all the writ petitions and contended that the Board’s resolution No.6.05 to 6.08
and 6.40 was passed on 03.02.2011 wherein the Scheme cost was finally decided.
9. The learned Counsel for the respondents relied upon paragraph 14 of the
said resolution to state that the cut-off date fixed for calculating interest on
the final land cost was taken as 31.08.1996 and the interest is calculated on
the final land cost from that date. He justified the calculation as above.
10. The notice which is under challenge contains two parts. The first part
refers to G.O.(Ms)No.37 dated 14.02.2011 and that G.O was issued for a limited
period of time granting the concessional rate of interest for the payment of
difference in the land costs. At this point of time, it is accepted by both
sides that G.O. is no more in force. Insofar as the petitioners are concerned,
G.O.(Ms)No.37 dated 14.02.2011 is not resorted to as they do not fall within the
period specified. The second part is the calculation of interest on the
differential land cost as per the terms of the agreement and that is now
disputed by the petitioners based on the finding of the Division Bench of this
Court and the decision of the Honourable Apex Court referred to above.
11. In view of the above, the only issue that has to be decided by this
Court will be with regard to the relevant date for payment of interest towards
difference in the land costs.
12. In the decision of the Division Bench of this Court in V.Muralidharan
v. State of Tamil Nadu reported in 2007 Writ L.R. 710, a similar claim was made
by the Housing Board to the allottees under the Ellis Nagar Housing Board
Scheme. Among other issues, the issue relating to payment of interest on
difference in land cost was considered and in that decision, it was held that
the relevant date for calculation of interest will be the date when the final
determination of the land cost was made i.e. 21.05.2004 based on the Board’s
resolution dated 31.12.2000 and the interest was directed to be paid from
21.05.2004 i.e. the date of final determination of land cost.
13. When the matter was taken up on appeal to the Honourable Supreme
Court, the issue relating to the relevant date above was modified to read as the
date when the Board’s resolution was actually passed. In other words, instead of
21.05.2004, the day after the Board’s resolution i.e., 01.01.2011 was to be
taken as the relevant date for payment of interest. In that case, the Board’s
resolution was passed on 31.12.2000 and the Honourable Supreme Court fixed the
relevant date for payment of interest as 01.01.2001. The present case is no
different from V.Muralidharan’s case and the said decision will squarely apply
to the present cases insofar as interest on the difference in land cost.
14. Drawing the same analogy to the present case, the Board’s resolution
even as per the counter affidavit and the copy of the resolution which has been
now produced by the learned Counsel for the respondent Housing Board, is dated
03.02.2011 whereby the final land cost has been determined.
15. In view of the decision of the Honourable Apex Court and the decision
of the Division Bench of this Court in V.Muralidharan’s case, relating to
allotment in the Ellis Nagar Housing Board Scheme which is similar to the
present case, the interest on the difference in the land cost shall be reckoned
from the date of Board’s resolution No.6.05 to 6.08 and 6.40 dated 03.02.2011.
16. The impugned notices in all the writ petitions insofar as they claim
interest on the difference in the land costs from an earlier date, is set aside
and the respondent Housing Board is directed to rework the interest as per the
agreement on and from the Board’s resolution dated 03.02.2011 till the date of
payment. Such exercise shall be completed within a period of eight weeks from
the date of receipt of a copy of this order. Subject to the above, the
respondents shall release the sale deeds if all other requirements are complied
with.
17. The petitioners are entitled to pay the other amounts as per the
notices forthwith to avoid default or interest liability if any applicable.
18. The writ petitions insofar as the petitioners are concerned, are
partly allowed as above. Consequently, the connected Miscellaneous Petitions
are closed. No costs.
rsb
To
1.The Secretary to Government,
State of Tamil Nadu,
Housing Unit and Urban Development
Department, Fort St.George,
Chennai – 600 009.
2.The Chairman and Managing Director,
Tamil Nadu Housing Board,
Nandanam,
Chennai – 600 009.
3.The Executive Engineer and
Administrative Officer,
Tamil Nadu Housing Board,
Tirunelveli Housing Unit,
Sivanthipatty Road,
Tirunelveli – 627 011.