Interest claims involving disputed facts should be pursued before an appropriate forum, not adjudicated in writ jurisdiction.

The petitioner no.1, Bengal DCL Housing Development Company Limited, is a joint-sector company in which the West Bengal Housing Board and DCL Properties Private Limited each hold 49.5% shares.

By letter dated 1 December 2010, respondent no.2, WBHIDCO Ltd., offered allotment of three acres of land at Plot No. BG/3, Sub-CBD area, Action Area-I, New Town, Kolkata, for a total consideration of ₹21,96,15,000. The petitioner paid 25% of the consideration, amounting to ₹5,49,03,750, following which the land was allotted to it.

The petitioners alleged that possession was not handed over and that the allotment was subsequently cancelled by letter dated 10 August 2013. Disputes thereafter arose concerning refund of the deposited amount.

By letter dated 22 September 2015, respondent no.2 stated that the amount would be refunded after deducting ₹2,26,49,906, allegedly recoverable from respondent no.3, the West Bengal Housing Board.

On 8 September 2026, respondent no.2 informed the Court that ₹2,26,49,906 had been remitted to the petitioner no.1. The petitioners acknowledged receipt of the amount but reserved their claim for interest for the period during which the amount was withheld.

Whether the petitioners were entitled to interest on the sum of ₹2,26,49,906 allegedly wrongfully withheld by respondent no.2.

Whether the claim for interest could be adjudicated in the writ proceedings, or required determination by an appropriate forum owing to disputed questions of fact.

Whether the contractual terms, particularly paragraph/clause 11 of the letter dated 1 December 2010, excluded any claim for compensation or interest.

The Court applied the principle that disputed questions of fact and contractual claims requiring evidentiary adjudication ordinarily cannot be conveniently determined in a writ petition under Article 226 of the Constitution.

The Court also considered the contractual stipulation relied upon by respondent no.2, namely paragraph/clause 11 of the letter dated 1 December 2010, which was argued to exclude compensation where the land was not allotted.

Although the principal amount of ₹2,26,49,906 had been refunded during the pendency of the writ petition, the petitioners continued to claim interest on the basis that the amount had been wrongfully retained.

Respondent no.2 disputed liability by relying on the contractual terms, particularly clause 11. Determining whether the withholding was wrongful, whether the contractual clause barred compensation, and the applicable period and rate of interest would require examination of disputed facts and contractual obligations.

The Court therefore held that such questions could not be conveniently adjudicated in the writ jurisdiction and left the petitioners free to pursue the claim before an appropriate forum.

The petitioners’ claim for interest was expressly left open for adjudication before an appropriate forum.

They were granted the benefit of exclusion of the period spent prosecuting the writ petition, provided that any such proceeding was initiated within one month from receipt of the certified copy of the order.