Partly allowed

R. Leelavathi v. The Andhra Pradesh Housing Board

Telangana HC3 Oct 2013WP/471/2012

Case brief

AI extract

What is this about?

The Single Judge allowed the writ petitions in part, directing the Andhra Pradesh Housing Board to re-calculate penal interest on belated instalment payments using the State Government's order dated 26.11.2010 instead of the original 1.5 times rate, and communicate the calculation within two months.

What did the court decide?

Direction to respondent No.1 to re-calculate interest applying G.O.Rt.No.303 dated 26.11.2010 and communicate the same to petitioners within two months.

R. Leelavathi Vs The Andhra Pradesh Housing Board — Specific Performance | Telangana HC (2013)

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THE HON’BLE SRI JUSTICE C.V.NAGARJUNA REDDY Writ Petition Nos.471/12, 19792/12, 20833/10, 27238/11, 30944/10 & 13487/11

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Dated 0 3 rd October, 2013

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Between:

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R.Leelavathi and others

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…Petitioners (W.P.No.471 of 2012)

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and

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The Andhra Pradesh Housing Board, rep.by its Vice-Chairman and Managing Director, Gruhakalpa, Hyderabad and another

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…Respondents

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(W.P.No.471 of 2012)

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Counsel for the petitioners: Sri M.Yeshwanth Kumar

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(W.P.No.471 of 2012)

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Counsel for the respondent: Sri M.Brahma Reddy

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(W.P.No.471 of 2012)

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The Court made the following:

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COMMON

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ORDER:

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In this batch of writ petitions, the only issue that needs to be considered is whether the levy of penal interest at 1½ times the interest fixed by the Andhra Pradesh Housing Board on outstanding instalments of the principal amount is unreasonable and arbitrary.

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The task of the Court is made easier by the State Government by issuing G.O.Rt.No.303, Housing (HB.II.1) Department, dated 26.11.2010. By the said GO, the State Government, considering the recommendation of the Vice-Chairman and Housing Commissioner of respondent No.1, has approved his proposal to permit respondent No.1 to collect penal interest at the flat rate of 12% per annum or the scheme rate of interest, whichever is higher, for the belated payment of the instalments by the allottees of the houses by respondent No.1, instead of at 1½ times on the normal scheme interest rate.

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Sri M.Yeshwant Kumar, learned counsel for the petitioners, submitted that while there is no dispute about the delay in payment, levy of penal interest is arbitrary. He therefore requested that the petitioners may be relieved of the obligation of payment of any penal interest.

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It is not in dispute that as per Clause-18 of the agreement of sale, the purchaser has to pay penal interest at 1½ times of the normal scheme interest rate on the belated payment of the instalments. This liability has now been reduced to 12% flat rate or the scheme rate of interest whichever is higher.

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In my opinion, the petitioners having agreed to pay penal interest for the belated payment must be thankful to the State Government for partially relieving them of the liability to pay the penal interest by reducing the same to the maximum of 12% or normal scheme rate interest whichever is higher.

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In the light of the above discussion, these writ petitions are allowed in-part with the direction to respondent No.1 to re-calculate the interest on the belated payments by each of the petitioners by applying G.O.Rt.No.303, Housing (HB.II.1) Department, dated 26.11.2010, and communicate the same to the petitioners, within two months from the date of receipt of a copy of this order.

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As a sequel to disposal of the writ petitions, the pending interlocutory applications shall stand disposed of as infructuous.

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C.V.NAGARJUNA REDDY, J

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03^rd October, 2013 Note: Issue CC in one week. (b/o) VGB

R. Leelavathi v. The Andhra Pradesh Housing Board

Case brief

What is this about?

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R. Leelavathi v. The Andhra Pradesh Housing Board

Case brief

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