SUNDARAM, J. ( 1 ) RULE. Mr. J. D. Ajmera, learned Counsel, appears for the respondent and waives service of rule. Considering the limited scope of the controversy, which we are called upon to resolve in this Special Civil Application, especially when we take note of the norms set down on the question in issue by the rulings of the apex Court, we propose to dispose of the Special Civil Application today itself, on merits. Learned Counsel on both the sides made their submissions, on merits. The proceedings, subject-matter of challenge in the Special Civil Application, is one under Sec. 14b of the Employees Provident Funds and Miscellaneous provisions Act, 1952 (hereinafter referred to as "the Act" ). By the proceedings impugned, the 1st respondent has chosen to impose 25% damages on the contributions, which were delayed for verying periods. The point that is being taken by Mr. Buch, learned Counsel for the petitioner, is that the adjudication of the question of imposition of damages by the 1st respondent runs counter to the ratio decidendi set down in Organo Chemical Industries and Anr. v. Union of India and Ors. , 1979 (II) LLJ 416 , in that the 1st respondent has not considered the various factors that should be normally taken note of on this question, such as the number of defaults, the period of delay, the frequency of defaults and the amounts involved. Further, learned Counsel for the petitioner would submit that the petitioner has been declared a "sick unit" and it is practically facing a financial crisis on account of huge losses and this also is a factor, which should be relevantly taken note of on the question of imposition of damages and the 1st respondent was not in order, in totally brushing aside this aspect as irrelevant, and giving an untenable reason for so brushing aside. ( 2 ) AS against this, Mr. J. D. Ajmera, learned Counsel for the respondents, would submit that the complaint that there has been no consideration of the relevant factors at the hands of the 1st respondent is a futile one and he draws our attention to the summing up paragraph in the impugned proceedings, in particular, to the following set of expressions:"xxx having regard to the circumstances, presistency and length of each default and on over all consideration of the representation made by the establishment xxxxx. "to say that this would suffice the purpose and the proceedings impugned need not be frowned upon on the ground of lack of consideration of the relevant factors. ( 3 ) THE fact remains that, apart from the sweeping statement in the summing up paragraph of the impugned proceedings, factors which have been set down as relevant to be considered while assessing the question of imposition of damages, have not been discussed at all by the 1st respondent. In the pronouncement in Organo Chemical Industries and Anr. v. Union of India and ors. , 1979 (II) LLJ 416 , the Supreme Court observed :"xxx Having regard to the punitive nature of the power exercisable under Sec. 14b and the consequences that ensue therefrom, an order under Sec. 14b must be a speaking order containing the reasons in support of it. The guidelines are provided in the Act and its various provisions, particularly in the word "damages" the liability for which in Sec. 14b arises en the "making of default". While fixing the amount of damages, the Regional Provident Fund Commissioner usually takes into consideration as he has done here, various factors, viz. , the number of defaults, the period of delay, the frequency of defaults and the amounts involved xxxxx"here, we find that, it is not a case of total omission to make the contributions. There had been only delayed contributions. The periods are different and the days of delay are also different. A glance at the statement of damages, annexed to the impugned proceedings, shows that the days of delay range from a minimum of 7 days to a maximum of 47 days, but, a flat rate of 25% has been adopted by the 1st respondent; and certainly, we cannot commed the impugned proceedings on the ground that the application of the norms, as set down by the pronouncement of the supreme Court, referred to above, has been done. This only exposes lack of application of mind on the part of the 1st respondent. As to how the functionary under sec. 14b of the Act should discharge the obligations has been expatiated by S. Natarajan, J. , as he then was, of the High Court of Madras in K. A. Subramaniam v. The Commissioner, the Regional Provident Fund, Tamil Nadu and Pondicherry states and Am. As to how the functionary under sec. 14b of the Act should discharge the obligations has been expatiated by S. Natarajan, J. , as he then was, of the High Court of Madras in K. A. Subramaniam v. The Commissioner, the Regional Provident Fund, Tamil Nadu and Pondicherry states and Am. , 1979 Labour and Industrial Cases 981, in the following terms"xxx The authority empowered to impose damages has to first of all decide whether the facts of a case warrant the imposition of damages. If his assessment of the situation results in a finding that imposition of damages is called for, then he has to determine the quantum of damages with reference to relevant factors such as the loss suffered by the affected party, the hardship caused to the beneficiaries, the efforts taken by the enforcement machinery to collect the defaulted payments etc. There is, therefore, a clear line of distinction between imposition of penalty which is penal in nature and imposition of damages which is compensatory in nature xxx xxx xxx"we cannot straightway say that what has been done by the 1st respondent by the impugned proceedings does conform to what has been recapitulated by the learned single Judge in the. above pronouncement. The petitioner has been declared a sick unit and the 1st respondent declines to take note of it for any consideration on a peculiar reasoning that the concerned authority BIFR has not specifically recommended for partial or total waiver of penal damages under the Act. When we take note of these features, we have no other alternative but to interfere in writ powers. Accordingly this Special Civil Application is allowed and the matter stands remitted back to the file of the 1st respondent for him to reconsider the whole question, taking note of the norms set down therefor by the pronouncements, referred to above, as well as other pronouncements throwing light on the subject. ( 4 ) IT is needless to state that the petitioner will co-operate in the procees to be freshly prosecuted by the 1st respondent. ( 5 ) RULE is made absolute to the aforesaid extent, with no order as to costs. .