Patna High Court
Sri Devendra Prasad Sinha vs The State Of Bihar on 2 May, 2025
Author: Mohit Kumar Shah
Bench: Mohit Kumar Shah
IN THE HIGH COURT OF JUDICATURE AT PATNA
Civil Writ Jurisdiction Case No. 8630 of 2014
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1.1. Dhananjay Kumar Son of Late Devendra Prasad Sinha Resident of M.I.G.-
224, Lohia Nagar, P.S.- Kankarbagh, District- Patna- 800020.
1.2. Sanjeev Kumar Son of Late Devendra Prasad Sinha Resident of M.I.G.- 224,
Lohia Nagar, P.S.- Kankarbagh, District- Patna- 800020.
1.3. Sushila Sinha Wife of Late Devendra Prasad Sinha Resident of M.I.G.- 224,
Lohia Nagar, P.S.- Kankarbagh, District- Patna- 800020.
... ... Petitioners
Versus
1. The State of Bihar through the Secretary, Housing Department, Government
of Bihar, New Secretariat Building, Patna.
2. The Bihar State Housing Board, through its Chairman, 6, Sardar Patel Marg,
Patna- 15.
3. The Chairman, Pricing Committee, Bihar State Housing Board, Patna.
4. The Managing Director, Bihar State Housing Board, 6, Sardar Patel Marg,
Patna- 15.
5. The Manager Estate-cum-Joint Secretary, Bihar State Housing Board, 6,
Sardar Marg, Patna 15.
6. The Executive Engineer, Patna Division no.- 1, Bihar State Housing Board,
6, Sardar Patel Marg, Patna- 15.
7. The Revenue Officer, Bihar State Housing Board, 6, Sardar Patel Marg,
Patna- 15.
... ... Respondent/s
======================================================
Appearance:
For the Petitioners : Mr. Bindhyachal Singh, Sr. Adv.
Mr. Krishna Chandra, Adv.
For the State : Mr. Pankaj Kumar Singh, AC to GA-9
For the Housing Board : Mr. Ansuman Singh, Adv.
======================================================
CORAM: HONOURABLE MR. JUSTICE MOHIT KUMAR SHAH
CAV JUDGMENT
Date: 02-05-2025
Patna High Court CWJC No.8630 of 2014 dt.02-05-2025
2/35
The present writ petition has been filed for quashing the
order dated 25.1.2014, passed by the Chairman, Pricing
Committee, Bihar State Housing Board, Patna, by which the
application, filed by the petitioner for waiving the interest
charged over the enhanced price has been rejected. The
petitioner has also prayed for quashing the consequential fresh
demand notice dated 31.01.2014, issued by the Revenue Officer,
Bihar State Housing Board, Patna. Lastly, it has been prayed to
direct the Respondent authorities to execute the registered lease
deed for 90 years in favor of the petitioners.
2. The brief facts of the case, according to the petitioners,
are that the father of the petitioners, late Sri Devendra Prasad
Sinha (hereinafter referred to as "the original petitioner") had
applied for allotment of house in the middle income group, vide
Application No. 168850, before the Bihar State Housing Board,
Patna (hereinafter referred to as "the Board"), whereupon the
Respondent-Board, after due scrutiny and verification, had
issued an allotment letter, vide Memo No. 6184, dated 2.8.1980,
for MIG House No. 224, ad-measuring 2.06 kattha, situated at
Lohiyanagar, Kankarbagh, Patna, wherein the interim (tentative)
cost of the land was mentioned as Rs. 59,200/-. Thereafter, the
Respondent-Board had entered into an agreement with the
Patna High Court CWJC No.8630 of 2014 dt.02-05-2025
3/35
original petitioner on 04.08.1980, after payment of 40% amount
i.e. a sum of Rs. 23,680/-. The Respondent-Board had then
issued a letter dated 08.08.1980, acknowledging payment of
40% of the estimated cost of the land in question, as also
admitting entering into an agreement with the original
petitioner. In this letter, it was also acknowledged by the
Respondent-Board that the original petitioner is residing in the
allotted plot on rent since 01.08.1977 and that allotment of the
said land/house has been regularized on rent cum purchase
basis. It is stated by the learned Senior Counsel for the
petitioners that as per the terms and conditions mentioned in the
allotment letter as well as in the lease agreement, the original
petitioner was required to pay the balance amount, after
deduction of a sum of Rs. 23,680/- from the estimated total cost
of Rs. 59,200/- in 180 equal installments of Rs. 403.26 per
month, which the original petitioner had paid in 142
installments only and in fact, the original petitioner had
deposited a sum of Rs. 709.57 in excess.
3. Nonetheless, the Respondent-Board, all of a sudden
issued a demand notice dated 10.1.2006 for a sum of Rs.
2,98,716/-, which was challenged by the original petitioner by
filing a writ petition bearing CWJC No. 4211 of 2007 and a
Patna High Court CWJC No.8630 of 2014 dt.02-05-2025
4/35
coordinate Bench of this Court, by an order dated 29.02.2012,
had disposed off the said writ petition with liberty to the
petitioner to move the Managing Director, Bihar State Housing
Board, Patna, by filing a representation/ application raising his
grievances, who in turn was directed to forward the matter to the
Pricing Committee, which was directed to consider the claim of
the respective parties and take a decision by passing a reasoned
order, after granting opportunity of hearing to all concerned,
within a period of four months of filing of such representation.
Thereafter, the original petitioner had filed a representation
before the Managing Director of the Respondent-Board,
whereafter the Pricing Committee of the Respondent-Board,
after hearing the parties had passed the impugned order dated
25.01.2014
, holding that as per the agreement the cost has been
revised, whereafter demand has been made as per the agreement
and along with the revised cost, interest also becomes
automatically applicable, hence no exemption can be granted as
far as the interest amount is concerned, thus there is no error in
the calculation made by the Board, therefore the claimant should
make payment of the amount calculated by the Board
immediately. The Board had then issued a fresh demand notice
dated 31.01.2014, raising a demand of Rs. 6,39,981.61/-.
Patna High Court CWJC No.8630 of 2014 dt.02-05-2025
4. It is submitted by the learned Senior Counsel for the
petitioners that the original petitioner had written a letter dated
22.06.1992 to the Executive Engineer, Patna Division-1, Bihar
State Housing Board, Patna, stating therein that full payment of
the house in question has been made by the month of June,
1992, hence a statement of amount deposited by the original
petitioner as per the Respondent-Board's account be furnished
so that the house can be transferred in the name of the original
petitioner, whereafter the Executive Engineer, Bihar State
Housing Board, Patna Division-1, Patna, had written a letter
dated 01.07.1992 to the Manager, Estate-cum-Joint Secretary,
Bihar State Housing Board, Patna, stating therein that he has
verified from the divisional ledger that the original petitioner
has made full payment of the house in question, hence in case
any further amount is to be paid by the petitioner, the same be
intimated to him, however no intimation was then made to the
original petitioner regarding any balance amount to be paid by
him. Nonetheless, the Revenue Officer of the Respondent-
Board, vide letter dated 10.01.2006, had raised a demand of Rs.
2,98,716/- on the head of balance payable amount and interest
thereon, pertaining to the land/house in question apart from a
sum of Rs. 1,875/- on the head of outstanding rent.
Patna High Court CWJC No.8630 of 2014 dt.02-05-2025
5. The learned Senior Counsel for the petitioners has next
submitted that as per the terms and conditions of the lease
agreement dated 04.08.1980, the original petitioner had paid the
entire balance amount including the principal amount and the
interest in only 142 installments instead of 180 installments and
had in fact deposited an excess amount of Rs. 709.57/-, which is
not disputed by the Respondent-Board. In fact, the original
petitioner had repeatedly written letters and approached the
Respondent authorities to intimate him about any outstanding
dues to be paid by him as well as requesting the authorities to
finally transfer the land and house in his name, however to no
avail. The learned Senior Counsel for the petitioners has, at this
juncture, referred to an office order dated 02.08.1980, issued by
the Chairman, Bihar State Housing Board, Patna, wherein it has
been admitted that after the year 1974, no further development
of any kind has been made and the Board has already charged
the capitalized cost, which includes the cost of land acquisition,
development charges as well as interest over the same. Thus, it
is submitted that no escalation cost could have been charged
from the original petitioner. The learned Senior Counsel for the
petitioners has further referred to an office order dated
18.3.2008, issued by the Chairman-cum-Managing Director,
Patna High Court CWJC No.8630 of 2014 dt.02-05-2025
Bihar State Housing Board, Patna, wherein it has been directed
that it would be incumbent upon the Housing Board to complete
the process of final transfer of the allotted house/flat/plots etc.
within 45 days of payment of the last installment and in case
any delay takes place in completing the process of final transfer,
after payment of last installment by the allottee, no interest or
penalty would be charged for the said period as also the
concerned Executive Engineer had been directed to send details
of payment of installments by the allottee and spot inspection
report within 15 days of payment of the last installment, to the
Estate Officer. Thus, it is submitted by the learned Senior
Counsel for the petitioners that since the Respondent-Board had
failed to complete the process of final transfer of the aforesaid
land/house in question in favor of the original petitioner within a
period of 45 days of payment of the last installment i.e. June,
1992, no interest / penalty can be charged from the petitioners.
6. The learned Senior Counsel for the petitioners has
contended that for the first time, the original petitioner was
intimated about the outstanding dues on account of price
escalation and the interest levied thereon, vide letter dated
10.01.2006 and along with the same a copy of the ledger
account of the original petitioner was enclosed showing
Patna High Court CWJC No.8630 of 2014 dt.02-05-2025
payment of all the installments before time i.e. in 142
installments instead of 180 installments as also admittedly
excess amount to the tune of Rs. 709.57/- was depicted to have
been paid by the original petitioner, as is apparent from running
pages no. 184 to 188 of the brief. The learned Senior Counsel
for the petitioners has also referred to the calculation chart,
appended to the said demand notice dated 10.01.2006, to submit
that for the first time, the Respondent-Board had disclosed that
though as per the agreement balance amount of Rs. 35,520/- was
to be paid in 180 installments, starting from the month of
September, 1980, however, by mistake a sum of Rs. 37,371/-
had been left out to be mentioned in the agreement (so-called
escalated price), hence after levying interest thereon for the
period September, 1980 upto the month of February, 2006, the
balance amount totals up to a sum of Rs. 2,98,715.65/-, apart
from outstanding rent to the tune of Rs. 1,875/-.
7. Thus, it is the submission of the learned Senior Counsel
for the petitioners that for the first time, the escalated
differential amount / left out amount to the tune of Rs. 37,371/-
was demanded from the original petitioner vide demand notice
dated 10.01.2006, which the original petitioner was also ready
to pay, nonetheless the Respondent-Board had illegally
Patna High Court CWJC No.8630 of 2014 dt.02-05-2025
demanded extra amount over and above the said amount of Rs.
37,371/- on the head of interest at the rate of 8.5 per cent per
annum starting from September, 1980 upto the month of
February, 2006, which is unlawful, inasmuch as the entire fault
lies with the Respondent-Board and is not attributable to the
original petitioner. In this regard, the learned Senior Counsel for
the petitioners has referred to a judgment dt. 05.12.2007,
rendered by a coordinate Bench of this Court, in CWJC No.
9630 of 1999 (Smt. Shanti Verma & Ors. vs. The State of
Bihar & Ors.), relevant portion whereof is produced herein
below:-
"Now in 1999 that is almost two decades after the house
was constructed on the already acquired lands and
almost two decades after petitioner's occupation thereof
and almost two decades after its allotment to the
petitioner, the impugned communications are issued by
the respondent-Housing Board informing the petitioner
that as on 30.04.1999, the final dues of the petitioner in
respect of the house allotted to him is about Rs
1,70,641/-, which the petitioner was required to deposit
immediately. As noted above, in 1981 when the house was
allotted to the petitioner, the tentative cost, as disclosed,
was about Rs 61,000/- which having been paid, a further
sum of over Rs. 1,71,000/- was being demanded. This
prima facie unreasonable demand brought the petitioner
to this Court.
Patna High Court CWJC No.8630 of 2014 dt.02-05-2025
It may be mentioned that the petitioner has annexed a
calculation (Annexure-7) in which it is shown that in fact
the cost escalation as on the date of allotment of house to
him in 1981 was about Rs 39,224.87 P only as against
which the demand now is of over Rs, 71,000/-.
It was urged that the difference between the two figures is
nothing but the interest that has been charged by the
Board over the said amount from 1981 to 1999. It is not
in dispute that this demand of escalated price or any part
thereof was ever earlier made from the petitioner. It is not
disputed that this cost escalation is being demanded for
the first time in the year 1999. Ultimately, the question is
whether the demand is justified, is it fair and equitable?
The petitioner submits that for the inordinate delay
caused by the Housing Boards, exclusively in finalizing
the demand, the petitioner, who was not at any fault
whatsoever, cannot be burdened with the phenomenal
interest burden as if the demand was made in 1981 itself
and the petitioner neglected to pay the same.
It may also be relevant to note one important fact at this
stage. As noted above, petitioner enclosed a chart
(Annexure-7) alleging that the cost of escalation was in
fact only about Rs 39,000/- as on 1981 and the rest
amount of the demand as being made in the year 1999 out
of about Rs 1,71,000/- was interest but these facts have
not been disputed or denied much less specifically by the
respondent-Board. They have accepted that the actual
cost was marginal but the balance was interest which is
also evident from the submissions made on behalf of
Patna High Court CWJC No.8630 of 2014 dt.02-05-2025
respondent-Board as noted above.
First coming to the submission of the respondent-Board
that it is a non-profit making organization working on no
profit no loss basis and, as such, its actions in charging
interest as aforesaid in respect of a demand raised for the
first time in 1999, interest being demanded from 1981 to
1999 is, thus, justified, I have only to say that if such a
stand is permitted and accepted by the Court as just, fair
and reasonable, it will only put premium on delay and
inefficiency to the detriment of citizens who have no say
in the matter. The Housing Board could have slept over
the matter for another decade and then raised the
demand adding another decade's interest and forced
petitioners to pay the same leaving them no alternative
but to pay. This, to my mind, is neither just nor fair. It is
for the respondent-Housing Board to manage its affairs
in an efficient manner and it cannot make the citizens pay
for its gross inefficiencies. Holding otherwise would be
making citizens pay for not what they have done but for
the mistakes committed by someone else who would
benefit from his own mistakes to the detriment of the
innocent citizen. This Court cannot permit such a
situation. If Housing Board seeks equity then it is well
established it must do equity as well. It cannot say that
my acts have been inequitous to the detriment of the
citizen, but citizens must recompensate it even though
they are not at fault or have committed no breach. It is
like punishing another for fault of yet another over whom
the punished has no control.
Patna High Court CWJC No.8630 of 2014 dt.02-05-2025
The petitioners have relied on a judgment of Hon'ble
Single Judge of this Court in the case of Smt Bina Singh
@ Sinha Versus Bihar State Housing Board & Others
being CWJC No 236 of 2001, which was allowed by
judgment and order dated 07.07.2006 of this Court. In my
view, the facts are virtually the same. That related to MIG
House No 172 at Lohianagar, Känkerbagh, Patna. Most
of the submissions as advanced before this Court were
also raised therein and they were considered and the
stand of the Board was rejected. Ultimately, this Court
directed in that case that the respondent-Housing Board
could lay a demand only in respect of actual price
escalation as on the date of allotment and not any interest
thereon, thereafter, till demand was made. The petitioners
have also placed reliance on judgment of this Court in
CWJC No. 10818 of 2000. disposed of on 15.09.2003,
which is similar to the case of Smt Bina Singh (supra)
and in this case also similar view was taken that interest
for anterior period to the demand could not be charged.
Against that judgment, it is stated at the Bar and not
disputed that Board's Letters Patent Appeal and then
Special Leave Petition to the Apex Court were dismissed
in limine. While delivering the said judgment in CWJC
No. 10818 of 2000, this Court placed reliance on a
Division Bench judgment of this Court in the case of
Bihar State Housing Board & Others Versus Sardar
Singh since reported in (1999) 1 BLJR 694. In that case,
Division Bench of this Court in the Letters Patent Appeal
by the Board challenging the judgment of the Single
Judge held that no interest could be charged for the
Patna High Court CWJC No.8630 of 2014 dt.02-05-2025
period prior to demand being made. There, it was found
that when the house was allotted in 1980 it was allotted
at a particular price and it was only in 1994 additional
demand was sought to be made for additional amount
and interest thereon. This demand was for the first time
being made by the Board. The respondent (writ
petitioner) it was held was not responsible for the delay
and it cannot be punished for the negligence on part of
the Board. The Division Bench then held that the learned
Single Judge was fully justified in striking off the interest
from the demand raised by the Board. No exception was
taken to the judgment delivered by the learned Single
Judge. The Letters Patent Appeal was dismissed. The said
Division Bench judgment of this Court still holds the
field.
Thus, in view of the judgments aforesaid, it is clear that
the interest component of the demand cannot be
sustained. The petitioner is, thus, liable to pay only the
actual cost escalation as on 1981 and not interest thereon
upto the date when finally the demand has been raised
because the delay in raising the demand is squarely on
part of the Board with which the petitioner had nothing to
do. Petitioner cannot be permitted to suffer because of
negligence, inefficiency or otherwise of the Board.
Thus, in the facts as noted above and in view of the law
as discussed above, I find that the demand as raised by
the respondent-Housing Board was wholly unjustified
and unsustainable in fact or in law in so far as it related
to the interest component on the escalated cost as
Patna High Court CWJC No.8630 of 2014 dt.02-05-2025
determined with effect from 1981 which is the date of
allotment of the house to the petitioner. The petitioners
would, thus, be liable to pay only the cost of escalation as
calculated as on 1981 and as the demand was for the first
time raised in 1999, no interest, can be charged for the
period in between that is from 1981 to 1999 and, thus, the
impugned letter of the year 1981 is quashed to the extent
indicated above. The petitioner would now, thus, be liable
to pay only the cost of escalation calculated with effect on
1981 when allotment was made to him and he came in
possession pursuant to the said allotment."
8. Thus, it is the submission of the learned Senior Counsel
for the petitioners that no interest could have been charged by
the Respondent-Board for the period prior to raising of the
demand vide demand notice dated 10.1.2006 and further no
interest is payable on the left out amount / escalated amount till
date, inasmuch as the Respondent-Board has deliberately
demanded illegal amount from the petitioners, hence it is
submitted that the demand notices dated 10.1.2006 as also the
one dated 31.1.2014 be quashed and the petitioners be granted
liberty to deposit the escalated price i.e. a sum of Rs. 37,371/-,
whereafter the Respondent-Board be directed to execute the
registered lease for 90 years, pertaining to the house in question,
in favor of the petitioners.
9. Per contra, the learned counsel for the Respondent-Board
Patna High Court CWJC No.8630 of 2014 dt.02-05-2025
has submitted, by referring to the counter affidavit /
supplementary counter affidavit / second counter affidavit / third
supplementary counter affidavit, filed on behalf of the
Respondent-Board that as per Clause 3 of the allotment letter
dated 02.08.1980, the tentative cost of the house was Rs.
59,200.00, subject to escalation on certain conditions. Clause 4
of the said allotment letter states that payment would be
followed by execution of the agreement, possession of the house
and cancellation of the allotment in case of non-compliance.
Thus, after adjusting the earnest deposit, the petitioner was
required to pay the balance amount of Rs. 35,520.00 for the
house in 180 monthly installments of Rs. 351.16 each, if paid
before the 7th of the month or Rs. 403.26, if paid after the 7th. It
is stated that Clause 4 of allotment letter dated 02.08.1980 states
that the property cost is tentative, subject to increase and Clause
6 thereof specifies the ground rent to be Rs. 2.00 per 10 square
meters annually for 260.22 square meters with the board having
the right to revise the rent every 30 years. Clause 7 states that
1% interest will be charged on all dues and a sum of Rs. 50.00
as administrative fee per default will apply for MIG. Clause 8
states that upon full payment and clearance of dues and there
being no violation of the terms, a 90-year leasehold deed will be
Patna High Court CWJC No.8630 of 2014 dt.02-05-2025
executed in favor of the settlee.
10. The learned counsel for the Respondent-Board further
submits that the petitioner was informed vide letter No. 124
dated 10.01.2006 (Annexure-C to the Counter Affidavit of the
Respondent-Board) that a sum of Rs. 2,96,616.00 is outstanding
for payment as on 31.01.2006 (Rs. 2,98,716.00 by 28.02.2006)
plus Rs. 1,875.00 on the head of due rent, hence he should pay
the same but to no avail.
11. It is stated by the learned Counsel for the respondent-
Board that in pursuance to the order dated 29.02.2012, passed in
CWJC No. 4211 of 2007, the Pricing Committee, after hearing
both the parties upheld the Board's demand for payment under
Clause 4(a) of the agreement including revised costs and
interest. A fresh demand notice for a sum of Rs. 6,39,981.61 was
issued on 31.01.2014 but the petitioner did not pay the same,
hence the final lease transfer could not take place.
12. In the supplementary counter affidavit filed on behalf of
the respondent-Board it has been stated that the valuation of the
MIG, house No. 224 is based on the total construction
expenditure incurred in 1973-74 with capitalization up to
31.03.1980, amounting to a sum of Rs. 69,804.00. Thus, the
revaluated price was calculated to the tune of Rs. 1,45,706.00,
Patna High Court CWJC No.8630 of 2014 dt.02-05-2025
payable by 30.04.1997 and communicated vide Board's Letter
No. 1285 dated 05.03.1997 (Annexure- H of the Supplementary
counter affidavit). In the 2nd supplementary counter affidavit
filed on behalf of the respondent-Board, it has been stated that
the petitioner has not deposited the full amount as per the Hire
Purchase Agreement and has failed to pay the required 148
installments in time.
13. Lastly, the learned counsel for the Respondent-Board has
relied on an order dated 10.02.2020, passed by the Hon'ble
Supreme Court of India, in Civil Appeal No. 1406 of 2020
(Bihar State Housing Board vs. Meera Prasad, dead through
LRS. & Ors.). The learned counsel for the Respondent-Board
has also relied on a judgment dated 13.09.2019, rendered by the
Hon'ble Apex Court in Civil Appeal No. 7243 of 2019 (The
Bihar State Housing Board & Ors. vs. Radha Ballabh Health
Care & Research Institute Private Limited), paragraphs no. 28
and 31 whereof are reproduced herein below:-
"28. The question raised before the High Court was
whether the appellant is entitled to updated price or the
market price. We find that such discussion by the High
Court is totally irrelevant inasmuch as the respondent has
accepted the price on three occasions; firstly on March
21, 2014, then on April 2, 2014 whereby, the respondent
Patna High Court CWJC No.8630 of 2014 dt.02-05-2025
remitted a sum of Rs.40 lakhs by two cheques as well. The
respondent has accepted the payment schedule but
subject to final measurements of plots. It is thereafter the
letter of allotment was issued on December 11, 2014.
Thirdly, the respondent remitted another sum of
Rs.1,71,00,000/- vide three separate cheques in January,
2015 so as to complete 20% of the interim price of letter
of allotment dated December 11, 2014. It is thereafter an
agreement was executed on March 12, 2015
unequivocally and categorically accepting the offer of the
appellant. It was not open to the respondent to dispute the
price of allotment offered by the appellant. The
respondent is estopped to dispute the allotment price in
these circumstances.
31. The action of the respondent to dispute the
allotment price after accepting the price is neither fair
nor reasonable and cannot be accepted."
14. At this juncture, the learned Senior Counsel for the
petitioners has submitted, by referring to the second
supplementary affidavit filed by the petitioners that the letter
dated 05.03.1997 brought on record by the Respondent-Board
by way of Annexure-H to the supplementary counter affidavit,
stated to have been written by the Revenue Officer, Bihar State
Housing Board, Patna, to the Executive Engineer, Bihar State
Housing Board, Patna Division-1, Patna, with a copy stated to
have been forwarded to the original petitioner was never either
Patna High Court CWJC No.8630 of 2014 dt.02-05-2025
received nor served upon the original petitioner or the present
petitioners and the detailed calculation chart has been received
by the original petitioner only vide the aforesaid demand notice
dated 10.01.2006, thus reliance placed on the said letter dated
05.03.1997 by the Respondent-Board is misplaced. Nonetheless,
it is submitted by the learned Senior Counsel for the petitioners
that the same reasoning put forth during the course of arguments
for assailing the demand notice dated 10.01.2006, would also
apply for annulment of the said letter dated 05.03.1997,
inasmuch as the same also contains interest element for anterior
period to the demand which cannot be charged.
15. I have heard the learned counsel for the parties and gone
through the materials on record. The admitted facts which are
not in dispute are that the MIG house bearing No. 224, situated
at Lohia Nagar, Kankarbagh, Patna, was allotted in favor of the
original petitioner, vide letter dated 02.08.1980, whereafter a
lease agreement was entered into between the Respondent-
Board and the original petitioner on 04.08.1980, wherein it had
been specifically stated that the settlee Board has agreed to allot
MIG House No. 224 to the original petitioner at a total cost of
Rs. 59,200/-, out of which initial payment of a sum of Rs.
23,680/- has been made and the balance amount shall be paid by
Patna High Court CWJC No.8630 of 2014 dt.02-05-2025
the original petitioner in 180 equal monthly installments,
starting from the first day of the month of September, 1980. The
original petitioner had then paid the balance cost, totaling to a
sum of Rs. 35,520/- in only 142 monthly installments and in fact
had paid an excess amount of Rs. 709.57. Thereafter, the
original petitioner had written a letter dated 22.6.1992 to the
Executive Engineer, Patna Division-1, Bihar State Housing
Board, Patna, stating therein that he has paid the entire cost of
the house in question, hence in case any outstanding amount is
required to be paid, he be intimated about the same so that the
process of final transfer can be completed. In pursuance thereof
the Executive Engineer, Patna Division-1, Bihar State Housing
Board, Patna, had vide letter dated 01.07.1992, written to the
Manager, Estate-cum-Joint Secretary, Bihar State Housing
Board, Patna that the original petitioner has paid the entire cost
of the house in question which has been verified from the
divisional ledger, hence it be intimated as to whether he has to
pay any further amount. The respondent-Board had then slept
over the matter and suddenly a demand notice dated 10.1.2006
was sent to the original petitioner demanding a sum of Rs.
2,98,716/- which comprised of a sum of Rs. 37,371/- on the
head of left out amount / escalated price and rest of the amount
Patna High Court CWJC No.8630 of 2014 dt.02-05-2025
was by way of interest for the period September, 1980 upto the
month of January/February, 2006.
16. The aforesaid demand notice dated 10.01.2006 was
challenged by the original petitioner by filing a writ petition
bearing CWJC No. 4211 of 2007 and a coordinate Bench of this
Court, by an order dated 29.02.2012, had disposed off the said
writ petition with liberty to the petitioner to move the Managing
Director, Bihar State Housing Board, Patna, by filing a
representation raising his grievances, who was in turn directed
to forward the matter to the Pricing Committee, which was
directed to consider the claim of the respective parties and take
a decision within a period of four months of filing of such
representation. The original petitioner had then filed a
representation before the Managing Director of the Respondent-
Board, whereafter the Pricing Committee of the Respondent-
Board had passed the impugned order dated 25.01.2014, holding
that as per the agreement the cost has been revised, whereafter
demand has been made and along with the revised cost, interest
also becomes automatically applicable, hence no exemption can
be granted as far as the interest amount is concerned, thus there
is no error in the calculation made by the Board, therefore the
claimant should make payment of the amount calculated by the
Patna High Court CWJC No.8630 of 2014 dt.02-05-2025
Board immediately. The Board had then issued a fresh demand
notice dated 31.01.2014, raising a demand of Rs. 6,39,981.61/-.
17. This Court finds that while the learned Senior Counsel for
the petitioners has submitted that since the left-out amount/
escalated price demand, to the tune of Rs. 37,371/- was raised
by the Respondent-Board for the first time vide demand notice
dated 10.01.2006, the Respondent-Board is precluded from
charging interest for the prior period, i.e September, 1980 to
February, 2006 and even, thereafter whereas the learned counsel
appearing for the Respondent-Board has submitted that the
original petitioner had given his consent for paying the revised
cost as per the terms and conditions entered into by him with the
Respondent-Board, hence along with the revised cost, the
amount of interest automatically gets levied, thus the petitioners
will have to pay the interest amount as well, in case they want
execution of the registered lease agreement.
18. Having gone through the materials on record, this Court
finds that admittedly the calculation chart, showing the levy of
revised cost / left out amount / escalated price amount, was
furnished to the original petitioner along with the demand notice
dated 10.01.2006, which has not been disputed by the
Respondent-Board and a bare perusal of the said calculation
Patna High Court CWJC No.8630 of 2014 dt.02-05-2025
chart would show that the amount of revised cost / left out
amount / escalated price is only a sum of Rs. 37,371/-, whereas
the remaining amount i.e. approximately a sum of Rs. 2,61,345/-
is on the head of interest for the period September, 1980 up to
the month of February, 2006 i.e. for a period of about 26½
years. It is a well-settled law that interest can be charged only on
an amount which was not paid upon legitimate demand being
raised and interest for anterior period to the demand cannot be
charged at all. In this connection, reference be had to the
judgment rendered by a coordinate Bench of this Court in the
case of Smt. Shanti Verma & Ors. (supra).
19. In Bihar State Housing Board vs. Sardar Singh,
reported in (1999) 1 BLJR 694, a learned Division Bench of this
Court has held that interest can be charged only on an amount,
which was not paid after demand, however if no demand has
been made, no interest can be charged. It would be gainful to
refer to yet another judgment, rendered by a coordinate Bench
of this Court in the case of Krishna Deva Prasad vs. The State
of Bihar & Ors., reported in (2003) 2 PLJR 46, paragraphs no.
17 and 18 whereof are reproduced herein below:-
"17. I have some doubt whether it was open to the
Board to take a decision not to allow the adjustment of
Patna High Court CWJC No.8630 of 2014 dt.02-05-2025
rent five years after the payments were accepted on that
basis and the contract was practically closed. But even
assuming that the Board was at liberty to unilaterally re-
open the issue of fixing the price of the house, there can
be absolutely no justification for not intimating the
petitioner and not making a demand from him for twelve
years even after the price of the house along with interest
was finally determined in November, 1984. In these facts
the demand for payment of interest on the outstanding
balance for the period November, 1984, to 20.3.1996
would plainly mean asking the petitioner to pay a heavy
penalty for the laches, oversight and inefficiency of the
Board. Though it is an admitted position that no notice or
intimation was sent to the petitioner prior to the letter,
dated 20.6.1996, with regard to the outstanding liability
in the light of the reversal of decision and adoption of a
different mode of calculation of interest, it is stated on
behalf of the Board that the petitioner was otherwise
aware of the outstanding dues against him. In this regard,
reliance is placed on a representation filed by the
petitioner on 11.6.1986, a copy of which is at Annexure
'D'. In my view, the reliance is wholly misplaced. In that
representation, the petitioner primarily made a request
for execution of the final transfer deed with regard to the
house allotted to him and all that was said in that
representation was that it was not open to the Board to
unilaterally change the terms or revise and re-fix the
price against the terms embodied in its proposal and
offer. In the rejoinder affidavit filed on behalf of the
petitioner it is explained that he used to go to the Board's
Patna High Court CWJC No.8630 of 2014 dt.02-05-2025
office from time to time and he had vaguely learnt that
there was some proposal to refix the valuation of the
house by a different mode and he was protesting against
that. Moreover, he did not receive any reply to this
representation filed in June, 1986, and he had, therefore,
no means to know that his pleas were not accepted and
the outstanding balance shown against him in the Board's
books of account was attracting huge Interests and that
by 1996 the dues had accumulated to a sum of over Rs.
01,67,528/-, In Bihar State Housing Board v. Sardar
Singh 1998 (3) All P.L.R., 404, a Division Bench of this
Court held that interest could be charged only on an
amount which was not paid after demand. In the facts and
circumstances of this case, the Division Bench decision
applies with full force and I have no hesitation in holding
that even if the Board's decision not to allow adjustment
of rent towards the value of the house is upheld it cannot
be held entitled to charge interest on the outstanding dues
as on 31.3.1979. From the discussion, made above, it is
clear that the Board can claim from the petitioner only a
sum of Rs. 26,445.90 but no interest accruing on that
amount for the simple reason that no demand for payment
of that sum was ever made to the allottee.
18. In the result, this writ petition is allowed. The
order, dated 8.4.2000, passed by the Board's Committee
(Annexure 10) and the Impugned demand (Annexure 7),
are quashed. The petitioner is directed to make payment
of the sum of Rs. 26,445.90 within one month from today
and the Board in turn is directed to execute the
Patna High Court CWJC No.8630 of 2014 dt.02-05-2025
document(s) of title with regards to MIG. House No. 119
and to submit them for registration within two months
from the date of the deposit made by the petitioner."
20. It would also be apt to refer to a judgment rendered by a
coordinate Bench of this Court in the case of Smt. Nawlakha
Devi & Anr. vs. State of Bihar & Ors., reported in (2005) 2
PLJR 184, paragraphs no. 1 and 2 whereof are reproduced
herein below:-
"1. On 2.2.1976 the husband of petitioner no. 1 was
allotted M.I.G. quarters No. 164M, Lohia Nagar,
Kankarbagh, Patna. The price of the quarters was fixed
at Rs. 58,000/-. The allottee deposited Rs. 6,500/- at the
time of filing of the application. However, it was clear
stipulation that the price may escalate due to acquisition
of land and further construction. On 12.4.1980 the
allottee was directed to deposit Rs. 8,000/-. He deposited
the said amount. After deposit of the said amount the
balance stood at Rs. 43,500/-. The allottee was permitted
to deposit the said amount in 60 monthly equal
instalments. He accordingly deposited the entire amount
till 1985. After deposit of the amount on 26.3.1985
petitioner no. 2 made a request to the Housing Board for
registration of the document. However, nothing was done.
Again, the respondent-Board raised a demand for Rs.
4,704/- towards principal and interest. The petitioners
deposited the said amount. The petitioners thereafter
have always been requesting the Housing Board to
Patna High Court CWJC No.8630 of 2014 dt.02-05-2025
register the deed. They also served legal notice for the
said purpose but nothing was done. The petitioners thus
filed C.W.J.C. No. 3170 of 1997 for direction to the
Housing Board to register the document. The said writ
petition was disposed of on 5.8.1998 directing the
petitioners to go before the Price Committee constituted
by virtue of the order of this court. The petitioners filed
written statement before the Price Committee of the
Board on 22.9.1998. For the first time the respondent
-Housing Board issued annexure 11, the calculation
chart. This annexure 11 was issued admittedly in the year
1997/1998. By annexure 11 the Housing Board raised the
price of the quarters in question to the tune of Rs.
18,981.17. However, the interest over the said amount
was calculated to the tune of Rs. 75,958.22. The dispute
is with respect to interest. It has been stated by the
learned counsel for the petitioners that whenever the
demand was made, the petitioners used to deposit and
they deposited the entire amount. Thereafter no demand
was made and calculation chart was made available to
the petitioners in the year 1998. Since there was no
demand, therefore, no Interest can be charged. Learned
counsel for the respondents, however, submitted that there
was a clause in the agreement that even though demand
was not raised interest could be charged over the due
amount. The submission, in my view, is fallacious. It is
well settled rule of law that interest over the due amount
can be charged only after demand. Admittedly, the house
in question was allotted to the husband of petitioner no. 1
in the year 1976 and the possession, according to the
Patna High Court CWJC No.8630 of 2014 dt.02-05-2025
Board, was delivered in the year 1980. The demand was
raised till 1987 and deposit was made by the petitioners
and thereafter no demand was made. Unless demand is
made no interest can be charged. In support of the
submission learned counsel relied upon a Division Bench
decision in the case of Bihar State Housing Board v.
Sardar Singh, (1999) 1 BLJR 694, wherein it has been
held that since no demand was made, therefore, no
interest can be charged. Similar view has been expressed
in the case of Krishna Deva Prasad v. State of Bihar 2003
(2) PLJR 46.
2. Thus, on consideration as discussed above demand
with respect to interest by the Housing Board cannot be
held to be legal. The said part of annexure 11 is hereby
quashed. The petitioners will pay Rs. 18,981.17 within a
period of three weeks from today and on deposit of the
said amount the Housing Board will execute registered
deed in favor of the petitioners within two months
thereafter."
21. Having regard to the law laid down by the learned
Division Bench of this Court in the case of Sardar Singh
(supra) and by the learned coordinate Benches of this Court in
the case of Krishna Deva Prasad (supra), Smt. Nawlakha Devi
& Anr. (supra) and Smt. Shanti Verma & Ors. (supra), this
Court is of the view that interest can be charged by the
Respondent-Board only on an amount, which has not been paid
after demand, however interest for anterior period to the demand
Patna High Court CWJC No.8630 of 2014 dt.02-05-2025
cannot be charged. Thus, in the present case even if the demand
notice dated 10.01.2006 is considered to be a notice intimating
the original petitioner about the balance cost / left out amount /
escalated price, no interest could have been charged for the prior
period, hence the petitioners are liable to pay only a sum of Rs.
37,371/-, which is the left out amount / balance cost / escalated
price amount. As far as the interest for the period after
10.01.2006 is concerned, this Court finds that the Respondent-
Board is responsible for creation of the aforesaid situation,
whereby and whereunder a wrong demand was raised, vide
demand notice dated 10.01.2006, inasmuch as the same also
includes interest for the prior period i.e approximately a sum of
Rs. 2,61,345/- and then the Pricing Committee had also rejected
the case of the original petitioner illegally, vide impugned order
dated 25.1.2014 on a wrong premise that once the original
petitioner has agreed to make payment of revised price, interest
would be levied automatically, which in any view of the matter
cannot be justified in law, since unless and until a demand is
raised pertaining to the revised cost and the allottee fails to pay
the same, no interest can be charged, a situation which had not
arisen prior to 10.01.2006. As far as the demand notice dated
31.1.2014 is concerned, by which further interest amount has
Patna High Court CWJC No.8630 of 2014 dt.02-05-2025
been added and demand to the tune of Rs. 6,39,981.61 has been
raised, the same is also not justified, rather is illegal on the
aforesaid analogy hence, this Court is of the view that the
Respondent-Board cannot be permitted to profiteer out of its
own wrong, thus the interest amount, post 10.01.2006 till date
can also not be charged from the petitioners. The law in this
regard is no longer res integra, inasmuch as the Hon'ble
Supreme Apex Court in a judgment, rendered in the case of
Kusheshwar Prasad Singh vs. The State of Bihar & Others,
reported in (2007) 11 SCC 447, has held in paragraphs no. 14 to
16, as follows:-
"14. In this connection, our attention has been invited
by the learned counsel for the appellant to a decision of
this Court in Mrutunjay Pani v. Narmada Bala Sasmalt
wherein it was held by this Court that where an
obligation is cast on a party and he commits a breach of
such obligation, he 9 cannot be permitted to take
advantage of such situation. This is based on the Latin
maxim commodum ex injuria sua nemo habere debet (no
party can take undue advantage of his own wrong).
15. In Union of India v. Major General Madan Lal Yadav
the accused army personnel himself was responsible for
delay as he escaped from detention. Then he raised an
objection against initiation of proceedings on the ground
that such proceedings ought to have been initiated within
Patna High Court CWJC No.8630 of 2014 dt.02-05-2025
six months under the Army Act, 1950. Referring to the
above maxim, this Court held that the accused could not
take undue advantage of his own wrong. Considering the
relevant provisions of the Act, the Court held that
presence of the accused was an essential condition for the
commencement of trial and when the accused did not
make himself available, he could not be allowed to raise
a contention that proceedings were time-barred. This
Court (at SCC p. 142, para 28) referred to Broom's Legal
Maxims (10th Edn.). p. 191 wherein it was stated:
"It is a maxim of law, recognised and established,
that no man shall take advantage of his own wrong;
and this maxim, which is based on elementary
principles, is fully recognised in courts of law and of
equity. and, indeed, admits of illustration from every
branch of legal procedure."
16. It is settled principle of law that a man cannot be
permitted to take undue and unfair advantage of his own
wrong to gain favourable interpretation of law. It is sound
principle that he who prevents a thing from being done
shall not avail himself of the non-performance he has
occasioned. To put it differently, "a wrongdoer ought not
to be permitted to make a profit out of his own wrong".
22. It would be gainful to refer to yet another judgment,
rendered by the Hon'ble Supreme Court of India in the case of
Municipal Committee, Katra & Others vs. Ashwani Kumar,
reported in 2024 SCC Online SC 840, paragraphs no. 18 and 19
Patna High Court CWJC No.8630 of 2014 dt.02-05-2025
whereof are reproduced herein below:-
"18. The situation at hand is squarely covered by the
latin maxim nullus commodum capere potest de injuria
sua propria', which means that no man can take
advantage of his own wrong. This principle was applied
by this Court in the case of Union of India v. Maj. Gen.
Madan Lal Yadav¹ observing as below:-
"28....In this behalf, the maxim nullus commodum
capere potest de injuria sua propria meaning no
man can take advantage of his own wrong squarely
stands in the way of avoidance by the respondent
and he is estopped to plead bar of limitation
contained in Section 123(2). In Broom's Legal
Maxim (10th Edn.) at p. 191 it is stated:
it is a maxim of law, recognised and established,
that no man shall take advantage of his own
wrong; and this maxim, which is based on
elementary principles, is fully recognised in
courts of law and of equity, and, indeed, admits
of illustration from every branch of legal
procedure."
The reasonableness of the rule being manifest,
we proceed at once to show its application by
reference to decided cases. It was noted therein
that a man shall not take advantage of his own
wrong to gain the favourable interpretation of
the law. In support thereof, the author has
placed reliance on another maxim frustra legis
Patna High Court CWJC No.8630 of 2014 dt.02-05-2025
auxilium invocat quaerit qui in legem committit.
He relies on Perry v. Fitzhowe [[L.R.] 8 Q.B.
757:15 QB 239]. At p. 192, it is stated that if a
man be bound to appear on a certain day, and
before that day the obligee puts him in prison,
the bond is void. At p. 193, it is stated that "it is
moreover a sound principle that he who prevents
a thing from being done shall not avail himself
of the non-performance he has occasioned". At
p. 195, it is further stated that "a wrong doer
ought not to be permitted to make a profit out of
his own wrong". At p. 199 it is observed that "the
rule applies to the extent of undoing of taking
away a right previously possessed".
19. It is beyond cavil of doubt that no one can be
permitted to take undue and unfair advantage of his own
wrong to gain favourable interpretation of law. It is a
sound principle that he who prevents a thing from being
done shall not avail himself of the non-performance he
has occasioned. To put it differently, 'a wrong doer ought
not to be permitted to make profit out of his own wrong.
The conduct of the respondent-writ petitioner is fully
covered by the aforesaid proposition."
23. At this juncture, it would not be fair to the Respondent-
Board in case the judgment referred to by its learned counsel are
not dealt with by this Court. As far as the order passed by the
Hon'ble Supreme Court of India in the case of Smt. Meera
Prasad (supra) is concerned, firstly the same does not lay down
Patna High Court CWJC No.8630 of 2014 dt.02-05-2025
any law and secondly the facts and circumstances of the said
case are distinguishable from the present case. As regards the
judgment referred to by the learned counsel for the Respondent-
Board, rendered by the Hon'ble Supreme Court of India in the
case of Radha Ballabh Healthcare & Research Institute
Private Limited (supra) is concerned, the same is also
distinguishable in the facts and circumstances of the present
case, inasmuch as it has been held in the said judgment that the
action of the allottee to dispute the allotment price, after
accepting the price is neither fair nor reasonable and cannot be
accepted, based on the fact that an agreement was executed
unequivocally and categorically accepting the offer of the
Housing Board, as also in view of the stipulation in the
advertisement that if the allotment letter is issued after
31.05.2008, the price of the allotted plot will be on the updated
rates as on the date of allotment, whereas in the present case,
though the original petitioner had paid the cost of the house in
question, as mentioned in the agreement executed by him with
the Respondent-Board, however after a lapse of about 26 ½
years, the Respondent-Board has revised the cost of the
aforesaid house and has sought to charge interest for the said
26 ½ years, for which the original petitioner cannot be faulted
Patna High Court CWJC No.8630 of 2014 dt.02-05-2025
and laches are wholly attributable to the Respondent-Board.
24. Having regard to the facts and circumstances of the case,
for the foregoing reasons and taking into account the law laid
down by the Hon'ble Apex Court as also this Court in various
pronouncements, as referred to herein above in the preceding
paragraphs, I deem it fit and proper to quash the impugned order
dated 25.01.2014, passed by the Chairman, Pricing Committee,
Bihar State Housing Board, Patna as also the demand notices
dated 10.01.2006 and 31.01.2014 respectively, issued by the
Revenue Officer, Bihar State Housing Board, Patna and direct
the Respondent-Board to accept the revised cost / left out
amount / escalated price to the tune of Rs. 37,371/- from the
petitioners and in case the same is paid within a period of four
weeks from today, the Respondent-Board shall initiate process
for final transfer of the house in question and execute the
necessary registered lease deed in favor of the petitioners within
a period of four weeks, thereafter.
25. The writ petition stands allowed.
(Mohit Kumar Shah, J)
Ajay/-
AFR/NAFR AFR
CAV DATE 12.12.2024
Uploading Date 02.05.2025
Transmission Date NA
