Published on: 15 August 2023 at 11:28 IST
Court: Supreme Court
Citation: Suneja Towers (P) Ltd. V. Anita Merchant (2023)
Honourable Supreme Court of India Consumer Forums have adequate powers to provide for the amount of compensation as deemed fit keeping in view of the facts, circumstances, the gravity of the negligence and consequential injury suffered by the consumer including punitive damages as per the deemed situation. However the Consumer Forum can-not award compound interest in the cases of monetary refund.
76. The synthesis of the cited decisions aforesaid, for the present purpose, leads to the result that none of these decisions could be taken as guide for award of compound interest in an action before the Consumer Fora under the Act of 1986. In regard to such cases, in our view, the forum would be entitled to provide for the amount of compensation as deemed fit, having regard to the facts and circumstances of the case and the gravity of the negligence of the opposite party and consequential injury suffered by the consumer.
The forum could award even punitive damages but that would depend on the relevant circumstances and for that matter, the relevant factors shall have to be specified. In regard to such awarding of compensation and/or punitive damages, the forum concerned could take all the relevant factors into account and award such amount as deemed fit and necessary but ordinarily, in the matters of money refund, awarding of compound interest as a measure of punitive damages is not envisaged.
As to what would be the quantum of compensation and for that matter, what would be the quantum of punitive damages, would depend on facts and circumstances of each case but while awarding so, the forum would be advised to specify all the relevant factors and basis of its quantification.
A shortcut of awarding compound interest is neither envisaged by the statute nor do we find any such term of contract between the parties or any such usage. As noticed, the attempt to seek compound interest in such real estate dealings did not meet with approval of this Court and in the case of Ireo Grace Realtech (supra) such a claim was declined by a 3-Judge Bench of this Court for having no nexus with the commercial realities of the prevailing market.
Going by the principles governing the nature of jurisdiction of the Consumer Fora as also the principles enunciated by this Court including those in the 3-Judge Bench decision, we need to disapprove the proposition of awarding compound interest in the cases of monetary refund in such dealings.
Drafted By Abhijit Mishra
