M/s. Eastern Synpacks Ltd vs State Of Jharkhand & Ors

In course of submission, learned counsel for the respondents/opposite parties has submitted a revised statement of amount of interest which the

respondents have now agreed to pay for the delayed payment on the total amount i.e. for the period of 11 months calculated from 4-5-2009 i.e. the

date after lapse of the three months stipulated period, till the date of payment, @ 10% per annum.

Counsel for the petitioner raises a dispute claiming that the respondents by such calculation, have sought to conveniently avoid payment of interest

for the period of 9 years commencing from 15-11-2000 till the date of final payment i.e. till today, although even as per the directions contained in the

impugned order of this Court, respondents are liable to pay interest for the entire 9 years period during which the payments were intentionally withheld

by the respondents.

As it appears, the petitioner had filed the writ application vide W. R (C) No. 1311 of 2008 in the year 2008, challenging the order of the respondents

dated 15-6-2007, issued by the Industries Department, Government of Bihar, whereby the respondents had declared that the petitioner company is not

entitled to any power subsidy. Upon contest, by order dated 4-2-2009, the petitioner's prayer was allowed with a specific direction in the following

terms to the respondent:

“The concerned respondents are directed to release the amount of power subsidy to the petitioner which had accrued from 9-5-1996 to

1999â€"2000 (later, period was modified and specified as 8-3-1995 to 17-3-2000) along with interest @ 12% per annum, within three months from the

date of this order. Since the period of claim of subsidy relates to the period prior to the date of reorganization of the State, the Department of

Industries, Government of Bihar, shall pay the amount of power subsidy as claimed by the petitioner, in accordance with the directions herein.â€​

The opposite party has claimed through its show-cause replies that the direction as contained in the order dated 4-2-2009 have been complied with

by making payment of Rs. 12,46,116.91 to the petitioner through his counsel. The opposite party has also conceded its liability to pay interest on the

aforesaid amount for the delay of 11 months in making the payment. The petitioner on the other hand, has disputed the contention of the

respondent/opposite party, on the ground that though, the principal amount of subsidy calculated from 8-3-1995 till 17-3-2000 along with the stipulated

rate of interest @ 12% per annum, has been paid, but while computing the amount of interest, the respondent/opposite party appears to have

conveniently ignored the period of almost nine years during which, payment of subsidy was withheld. By submitting afresh statement of calculation,

the petitioner has claimed that it is entitled to a total sum of Rs. 23,29,072.59 which includes the principal amount of subsidy for the period 1995â€"96

till 1999â€"2000 and interest calculated @ 12% per annum on the principal amount, till the date of final payment.

The controversy, as now raised, relates to the payment of amount of interest for the period of nine years, till the date of final payment, during which

period, payment of the subsidy was withheld.

The direction contained in the order of this Court dated 4-2-2009 has to be understood in the context in which it was passed. While allowing the writ

application of the petitioner, this Court had declared that the Department of Industries, Government of Bihar was liable to pay the amount of power

subsidy to the petitioner for the relevant years. Therefore, while directing the respondent State of Bihar to pay the total amount of subsidy which had

accumulated in between the period 8-3-1995 till 17-3-2000, a further direction was issued to pay the principal amount together with interest @ 12%

per annum, within three months from the date of the order. The order implies therefore unequivocally that the interest has to be computed at the rate

specified from the date when the specified amounts were payable, till the date of final payment. There is no ambiguity or vagueness in the direction as

contained in the order dated 4-2-2009 and it leaves no scope for any other interpretation as sought to be made by the respondent/opposite party. To

reiterate, the liability to pay interest on the delayed payment continue from the date when the principal amounts of subsidy was payable and till the

date when the amounts were finally paid. Even otherwise, the period between 8-3-1995 till 17-3-2000 was specified only for the purposes of

computing the total amounts of arrears of subsidy upon which, the interest was payable at the stipulated rate, till the date of payment specified in the

order. The direction did not confine payment of interest till 17-3-2000 only.

In the light of the above facts and circumstances, the payment of Rs. 12,46,116.91 made by the respondent/opposite party to the petitioner now, is

deemed to be only partial compliance of the order.

The respondent/opposite party is therefore directed to compute the amounts of interest which had accrued at the stipulated rate of 12% per annum

for the entire period commencing from the date when the subsidy amount was payable and till the date of final payment and to pay the same to the

petitioner within one month from the date of this order.

Let this case be posted on 10th May, 2010.

Let a copy of this order be given to the counsel for the respondent/opposite party, State of Bihar.

Order accordingly.