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HUDA v. Kedar Nath

Civil Appeal · Neutral citation not assigned (Civil Appeal No. 9951 of 2014)Decided 29 Oct 2014
Civil Appeal No. 9951 of 2014
Justice Anil R. Dave · Justice Kurian Joseph · Justice R.K. Agrawal

Background

An auction purchaser paid one-quarter of the price of a commercial booth but repeatedly failed to pay the remaining instalments. He successfully challenged HUDA's demand for 18% compound interest in the lower courts. Even after the Supreme Court offered opportunities to pay using the 10% rate he accepted, he paid nothing toward the outstanding amount.

Decision Breakdown

The Supreme Court allowed HUDA's appeal and set aside the lower courts' orders. It found prolonged and continuing default, lack of a genuine intention to pay, and construction carried out without permission. Even assuming the objection to 18% compound interest was correct, that did not excuse failure to pay the undisputed price and 10% interest. The Court refused further time and permitted HUDA to recover possession in accordance with law; it did not resolve the appeal by approving the disputed higher interest rate.

Lesson Learnt

Disputing an excessive interest demand does not excuse nonpayment of sums you accept are due. Repeated failure to honour an auction's payment terms can lead to lawful resumption despite an earlier favourable court order.

Official source (sci.gov.in)View Judgment (PDF)

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