Final Relief Could Not Be Granted In An Interlocutory Application: SC Sets Aside Consumer Commission Order

Post By 24 Law
June 25, 2025

The Supreme Court overturned an order by the National Consumer Disputes Redressal Commission (NCDRC), which directed the Indore Development Authority (IDA) to accept the outstanding payment and transfer the possession of a plot of land that had been allotted 28 years ago. The Court was reviewing a Special Leave Petition challenging the NCDRC's decision to instruct the IDA to accept payment with interest and hand over the plot after multiple rounds of litigation.

A two-judge Bench comprising Justice Bela M. Trivedi and Justice Satish Chandra Sharma observed that the respondent had defaulted on the payment as per the terms of the allotment, even after the first round of litigation in the High Court. The Court stated, "It was the respondent who committed default in depositing the balance amount as per the terms and conditions of the [Notice Inviting Tender] and even after the first round of litigation before the High Court, the respondent did not deposit the amount... which was outstanding against him and, therefore, at this juncture, after a lapse of 28 years, the question of directing the appellant i.e. Indore Development Authority as has been done by the National Commission to accept the amount does not arise."

Regarding the order by the State Consumer Forum, the Court remarked, "In the considered opinion of this Court, final relief could not have been granted by the State Commission on an interlocutory application filed in the matter." The Court set aside both the orders passed by the State and National Forums and instructed the IDA to issue a fresh tender for the plot and allot it through auction or by following the due process as per the rules.

Advocate Amit Pawan appeared for the appellant, Indore Development Authority, and Advocate Udayaditya Banerjee appeared for the Respondent, one Dr. Hemant Mandovra.

Background of the Case

The case stemmed from a notice inviting tenders for various plots, including one allotted to the respondent after he submitted his offer. The payment terms involved an initial 50% premium and lease rent within 30 days, with the remaining amount payable in 12 quarterly installments. Although the respondent made the initial payment, he failed to deposit the remaining installments, leading to the cancellation of the allotment as per the rules of the IDA.

The respondent challenged the cancellation by filing a writ petition in the Madhya Pradesh High Court, which restored the allotment on the condition that the outstanding amount be paid within 30 days. The respondent then submitted a demand draft but not for the full amount, which led the IDA to return it. The respondent subsequently requested a reduction in the amount, which the IDA allowed. However, instead of making the reduced payment, the respondent filed a complaint with the District Consumer Disputes Redressal Forum, seeking the execution of the sale deed. The District Forum dismissed the complaint because the respondent had not deposited the required amount as directed by the High Court.

The respondent then approached the High Court again through a writ petition, which was withdrawn. He later sought permission from the State Forum to deposit the reduced amount under protest, with the liberty to reclaim it. The IDA opposed this request, stating that the amount had increased due to accumulated interest. The State Forum granted an interim order, eventually directing the respondent to pay the full outstanding amount with interest. The National Forum, in its revision petition, instructed the IDA to calculate the interest within two weeks, accept the payment, and hand over possession of the plot within three weeks from receipt of payment.

Court's Conclusion

The Supreme Court noted that the National Commission had overlooked the appellant's arguments and erroneously directed the IDA to accept the payment and hand over the plot. Consequently, the Court set aside the earlier orders and directed the IDA to issue a fresh tender and follow the proper procedures for allotment.