The National Consumer Disputes Redressal Commission in Vivek Kishorchandra Mehta and Anr versus Puranik Builders Pvt. Ltd. & Anr. reversed the Orders passed by the the State Disputes Redressal Commission, Maharashtra and allowed the interest to the appellant @6% P.A. while observing that if money has remained for some time with the opposite parties, they are liable to pay some interest on that amount. As there was no agreement in terms of payment of interest or on the rate of interest and the complainant himself has cancelled the contract and demanded the refund of the amount paid,it is deemed appropriate to allow a lump sum compensation equivalent to interest @ 6% p.a. on the amount refunded.
The State Commission had dismissed the complaint while observing as under:
It appears that complainant himself has cancelled the booking of the flat no. 404 out of Building N0. A-3. It is admitted fact that the complainant received back an amount of Rs. 60,00,000/- paid towards consideration without any protest. It appears that the contract between the parties came to an end. Now, relationship between the parties does not exist as consumer and service provider. Therefore, consumer complaint is not admitted and dismissed in limine.
The National Commission observed so while referring para 9 of case titled as Alokl Shanker Pandey versus Union of India & Ors., II(2007) CPJ 3(SC).At para 9 of the said Judgment it was observed as under by the Apex Court:
“9. It may be mentioned that there is misconception about interest. Interest is not a penalty or punishment at all, but it is the normal accretion on capital. For Example if A had to pay B a certain amount, say 10 years ago, but he offers that amount to him today, then he has pocketed the interest on the principal amount. Had A paid that amount to B 10 years ago, B would have invested that amount somewhere and earned interest thereon, but instead of that A has kept that amount with himself and earned interest on it for this period. Hence equity demands that A should not only pay back the principal amount but also the interest thereon to B.”