JUDGMENT 1. - The petitioner, a Private Limited Company, has filed this writ petition for a direction to the respondents to pay an amount of Rs. 38,13,050/- as compensation by way of interest on the delayed release of subsidy. 2. The Government of India, Government of Rajasthan and the Rajasthan Financial Corporation with a view to promote industrialisation of backward areas/districts of Rajasthan had notified a scheme for grant of subsidy to industries set up in the notified backward districts subject to fulfilment of certain conditions. It is stated that the investment subsidy scheme was originally formulated by the Government of India on 26.8.1971 and the industries set up in the notified area as Category 'A', Category 'B' and Category 'C' were to be eligible for grant of central subsidy on fixed capital investment. The area of Udaipur where the industry of the petitioner is situated was notified in Category 'B' area. On the representations by the Government of India in terms of the aforesaid notification for grant of central investment subsidy, the petitioner had decided to set up a plant for manufacture of industrial oxygen gas at Udaipur which was a centrally backward area falling in Category 'B'. The petitioner got himself registered with the Director General of Trade Development, Central Sales Tax and Rajasthan Sales Tax authorities etc. Rajasthan Financial Corporation (herein-after called as RFC) had also sanctioned a loan of Rs. 48 lacs on 12.6.1985. It is stated that while sanctioning the short term loan, the RFC had relied on the under stated short projections as to the other sources of funds including the subsidy i.e. Capital, RFC Loan and Subsidy total Rs. 80 lacs out of which subsidy was considered as Rs. 11.50 lacs. The petitioner submits that it was registered by District Industries Centre for grant of central subsidy and the adoption by the RFC for the central subsidy as one of the source of funds which had induced the petitioner in believing that the assessment of the Government and the RFC to the effect that the petitioner was entitled to Rs. 15 lacs of subsidy in terms of central subsidy scheme. 3. The case of the petitioner was rejected for grant of subsidy on 13.12.1986. The petitioner challenged the rejection of grant of subsidy by filing S.B. Civil Writ Petition No. 2660/90 Earnest Industrial Gases Pvt. Ltd. Vs. 15 lacs of subsidy in terms of central subsidy scheme. 3. The case of the petitioner was rejected for grant of subsidy on 13.12.1986. The petitioner challenged the rejection of grant of subsidy by filing S.B. Civil Writ Petition No. 2660/90 Earnest Industrial Gases Pvt. Ltd. Vs. Secretary to the Government and others . A direction was sought from the High Court for directing the respondent to grant the central subsidy on investment in their unit to the extent of 15% of their investment subject to the over all ceiling prescribed by various circulars. A further amount of interest was also claimed for delay in disbursement of the subsidy. The writ petition was decided on 24.4.1995 and the action of the respondent in not granting the subsidy was set aside and the respondent was directed to consider the case of the petitioner on merit. As per the mandamus issued by the High Court in the above said writ petition, the State Level Committee in its meeting held on 10.10.1995 had decided that the petitioner was eligible to the grant of subsidy and it was recommended that the matter be taken up with the Union of India for granting subsidy to the petitioner and ultimately the Government of India vide its order dated 4.2.1997 conveyed the sanction of the President for the payment of Rs. 13.50 lacs to the Director of Industries, Rajasthan for disbursement to the petitioner company, in compliance of the order of the High Court and as per the decision taken by the State Level Committee. The order dated 4.2.1997 has been annexed as Annexure-1 which was conveyed to the petitioner on 19.2.1997 vide Annexure-2. A demand draft was also sent to the petitioner with the letter Annexure-3. It is the case of the petitioner that the subsidy of Rs. 13.50 lacs had ultimately reached him in the month of February/ March 1997 and the amount so received by the petitioner was handed over to the RFC for clearing his debts. It is the case of the petitioner that he was entitled for release of subsidy in September 1986, but by illegal order and without assigning any reason what so-ever, the petitioner was denied of the benefit of subsidy amounting to Rs. 13.50 lacs. 4. It is the case of the petitioner that he was entitled for release of subsidy in September 1986, but by illegal order and without assigning any reason what so-ever, the petitioner was denied of the benefit of subsidy amounting to Rs. 13.50 lacs. 4. The petitioner had been representing time and again and on each and every representation the petitioner was told by the respective authorities that no subsidy is to be given to the petitioner and it was only when the writ petition was filed in the year 1990 which was decided in the year 1995, ultimately, the respondent realised its own mistake and released the subsidy in March 1997 which otherwise could and should have been released in 1986. 5. It is the case of the petitioner that because of non-release of the subsidy, he had to obtain financial assistance of over Rs. 12.50 lacs from SBBJ as loan and had to pay heavy interest to such bank and had to suffer because of wrongful act of the respondent. It is stated that he had actually suffered a loss. It is further submitted that the RFC had also charged interest at the rate of 12.5% p.a. up to 31st December, 1991, 13% up to September, 1996 and more than 26% from 1st October, 1996 onwards and if the rate of interest at the above said rate is awarded to the petitioner, the petitioner shall be entitled to an amount of Rs. 38,13,050/- as per calculation attached as Schedule 'A'. 6. The respondents while admitting the facts as stated in regard to the establishment of industry, conditions of grant of subsidy, declining to grant of subsidy in the year 1986 when it was due, filing of the writ petition for a mandamus to the respondents for consideration for subsidy to be released and ultimately decision having been taken by the respondents to release the subsidy, are admitted. However, objections have been taken to the effect that because of filing of the earlier writ petition, the matter was filly hit by the principles of res judicata and that no writ petition was maintainable with the prayer to pay compensation in the shape of interest. 7. However, objections have been taken to the effect that because of filing of the earlier writ petition, the matter was filly hit by the principles of res judicata and that no writ petition was maintainable with the prayer to pay compensation in the shape of interest. 7. It is the submission of the learned counsel for the respondents that the petitioner had earlier as well in the writ petition No. 2660/90 while praying for release of central investment subsidy had also prayed for grant of interest 18% p.a. due to delay in disbursement of central investment subsidy and invites the attention of this court to the order passed by this Court on 24.4.1995 in the above-said writ petition, copy of which has been attached as Annexure R-1/1. The Hon'ble Judge of this court had determined the question whether it is the date of the application or the date of investment or the date of consideration of the application by the State Level Committee which confers any right in favour of any particular interpreuner. The scheme for central investment subsidy provides the eligibility conditions which scheme had come to an end on 30.9.1988 and as per the instructions issued by the Central Government in circular dated 21.7.1989, it was decided that any project sanctioned before 30.9.1988, disbursement made by the State Government or its agency in respect of non-manufacturing activities will be eligible for reimbursement by the Government of India. It was further noticed that the doctrine of promissory estoppel represents a principle evolved by equity to avoid injustice and, though commonly named promissory estoppel, it is neither in the realm of contract nor in the realm of estoppel. The matter was considered by the Single Judge of this court in the above-said writ petition and it was held that where the application has been considered before 30.9.1988 and subsidy was not granted for the reason which may or may not be sustainable under law, at later stage the respondents cannot raise a plea that the scheme had come to an end and the respondents were not justified in rejecting the application on the ground that the scheme had come to an end. A direction was given to the respondents to pass an order after giving an opportunity to the petitioner of hearing within a period specified in the judgment. A direction was given to the respondents to pass an order after giving an opportunity to the petitioner of hearing within a period specified in the judgment. The operative part of the judgment is reproduced as under: 'The consideration of the application besides the investment is the relevant criteria and, therefore, the application of the petitioner could not be refused to be considered on the ground that the scheme has not come to an end. In my view, therefore, in a case where the application has been considered before 30.9.1988 and the subsidy was not granted for reason which may or may not be sustainable under law, at later stage the respondents cannot raise a plea that the scheme has come to an end. The respondents were not justified in rejecting the application on the ground that the scheme has come to an end. The effective steps of investment were also taken in time. The orders of the respondents, therefore, are and the matter is sent to the Central Government to consider the case of the petitioner on merit and not to reject the application on the ground that the scheme has come to an end on 30.9.1988. The respondents would pass an order after giving an opportunity to the petitioner of hearing within a period of three months from the date of submission of copy of this judgment. The writ petition is accordingly allowed." 8. This court had determined the rights of the petitioner to the effect that his application had not been properly considered and he was entitled for consideration of grant of subsidy and, therefore, direction was given to the respondents to consider the case of the petitioner by holding that declining of subsidy was not in accordance with law. 9. After the aforesaid decision of this court, the matter had been taken up by the State Level Committee and again was sent to the Union of India and the Union of India after consideration of the case ultimately revoked its earlier order of 1986 and passed a fresh order granting subsidy which was ultimately paid in the month of February/ March 1997. Prior to the decision of the State Level Committee and the Government of India, it could not be said that the matter stood concluded so far as actual payment of subsidy was concerned or is hit by the principles of res judicata. Prior to the decision of the State Level Committee and the Government of India, it could not be said that the matter stood concluded so far as actual payment of subsidy was concerned or is hit by the principles of res judicata. If any wrong decision had been taken, the petitioner was at liberty to approach this court afresh and if any right, according to the petitioner had accrued to it, even after subsequent decision of grant of subsidy, the petitioner could definitely get it enforced. In the present case, for the first time when the decision of subsidy was taken by the department, was when after the decision of the High Court, the matter was put up before the State Level Committee and ultimately the Government of India agreeing with the recommendations of the State Level Committee had decided to pay the subsidy which should have in any case been paid in the year 1986 and, therefore, the plea of res judicata in the present case is not available to the counsel for the respondent. 10. I am also strengthened by the a judgment in the case of Life Insurance Corporation of India and another Vs. Gangadhar Vishwanath Ranade (1989)4 SCC 297 wherein the writ petition was filed against the LIC to make certain payment due against the policy to the insurer along with interest and the writ petition was withdrawn on withdrawal of the notice issued by the Income Tax Officer under Section 226(3) of the Income Tax Act. It was in consequence of the withdrawal of the ITO's notice that the payment was actually made by the LIC to the respondent. It was held by the Hon'ble Supreme Court that it was difficult to appreciate as to how the withdrawal of the writ petition can in any manner preclude the respondent from raising the question of the LIC's liability to pay interest when the principal amount alone was paid later. On principal amount having been paid the writ petition was filed by the insurer to pay interest on the principal amount due against the policies and the Hon'ble Court had held that the writ petition was clearly maintainable and the earlier writ petition could not in any manner got the adjudication on this point. On principal amount having been paid the writ petition was filed by the insurer to pay interest on the principal amount due against the policies and the Hon'ble Court had held that the writ petition was clearly maintainable and the earlier writ petition could not in any manner got the adjudication on this point. It was observed as under: 'The next writ petition filed by Smt. Kamalabai G. Ranade was S.C.A. No. 302 of 1977 in the Bombay High Court. The prayer made therein was for a direction to the LIC to pay the principal amount together with interest thereon. In this writ petition also the ITO was impleaded as a party. This writ petition had to be filed because inspite of the LIC having made the requisite statement under Section 226(3)(vi) of the Income Tax Act, 1961 on December 5, 1975 the ITO had not withdrawn the notice under Section 226(3) of the Income Tax Act, 1961 issued to the LIC and, therefore, the LIC was not making the payment to the respondent. On April 4, 1977 that writ petition was dismissed as withdrawn as a result of the ITO's counsel filing a copy of the order dated April 1, 1977 withdrawing the ITO's notice under Section 226(3) of the Income Tax Act, 1961 enabling the LIC to make the payment due against the policies to the respondent. The operation of the notice under Section 226(3) of the Income Tax Act, 1961 by the ITO being the only reason given by the LIC to support its action of non-payment to the respondent, it was unnecessary to pursue that writ petition when the ITO had made the order withdrawing the notice under Section 226(3) of the Act. Admittedly, it was in consequence of the withdrawal of the ''ITO's notice by order dated April 1, 1977 that payment was actually made by the LIC to the respondent. It is, therefore, difficult to appreciate how the withdrawal of that writ petition can, in any manner, preclude the respondent from raising the question of the LIC's liability to pay interest when the principal amount alone was paid later. It is, therefore, difficult to appreciate how the withdrawal of that writ petition can, in any manner, preclude the respondent from raising the question of the LIC's liability to pay interest when the principal amount alone was paid later. The LIC having refused to pay the interest on the principal amount in spite of the inordinate delay in payment, the Writ Petition No. 1248 of 1977 had to be filed giving rise to this appeal raising only the question of LIC's liability to pay interest on the principal amount due against the policies. The same is, therefore, dearly maintainable and the earlier writ petitions cannot, in any manner, bar the adjudication of this point herein for the reasons already given. This contention of the learned counsel for the appellant is also, therefore, rejected.' 11. In regard to second plea being taken by the respondents that the petitioner could not have filed the writ petition for direction to pay compensation by way of interest i.e. the writ petition cannot be filed for claiming the interest. The counsel for the petitioner relies on the judgment LIC Vs. Gangadhar Vishwanath Ranade (supra) wherein the Hon'ble Supreme Court had held that assignee of the policies who had become entitled to receive the amounts due thereunder on the dates of their maturity, must be compensated by the LIC for its failure to perform statutory obligation within a reasonable time. It was held that the performance of this statutory obligation by the LIC, in the present case, being after inordinate delay, award of interest to the assignee of the policies to whom the payment thereunder had to be made even according to the stand of the LIC was, therefore, clearly justified. The Hon'ble Supreme Court had held that the interest @15% p.a. cannot be said in excessive to permit interference with the writ in appeal when particularly the High Court had come to the conclusion that that was the reasonable rate in view of the fact that the LIC itself charges interest at that rate. 12. Yet in another case Executive Engineer (Irrigation) Balimela and others Vs. Abhaduta Jena and others (1988) 1 SCC 418 the Hon'ble Supreme Court had held that the general statutory provisions in regard to the award of interest by a court are contained in the Interest Act and the Civil Procedure Code. 12. Yet in another case Executive Engineer (Irrigation) Balimela and others Vs. Abhaduta Jena and others (1988) 1 SCC 418 the Hon'ble Supreme Court had held that the general statutory provisions in regard to the award of interest by a court are contained in the Interest Act and the Civil Procedure Code. It was observed as under: 'The general statutory provisions in regard to the award of interest by a court are contained in the Interest Act and the Civil Procedure Code. The Interest Act of 1839 contained only one section and it was as follows:' 1. It is, therefore, hereby enacted that, upon all debts or sums certain payable at a certain time or otherwise, the court before which such debts or sums may be recovered may, if it shall think fit, allow interest to the creditor at a rate not exceeding the current rate of interest from the time when such debts or sum certain were payable, if such debts or sums be payable by virtue of some written instrument at a certain time, or if payable otherwise, then from the time when demand of payment shall have been made in writing, so as such demand shall give notice to the debtor that interest will be claimed from the date of such demand until the term of payment: provided that interest shall be payable in all cases in which it is now payable by law.' 'In 1978, the Interest Act 1839 was repealed and a new Interest Act was enacted. The Statement of Objects and Reasons of the new Act recited:' 'The Law Commission of India in its sixty-third report had recommended the revision of the existing Interest Act, 1839. This Act is a very short one; besides a preamble, it contains only one section and a proviso. However, it is a statute of importance, since it prescribes the general law of interest which becomes applicable in the absence of any contractual or statutory provisions specifically dealing with the subject. According to the Commission, almost every phrase used in the Act has given rise to problems of interpretation and judicial decisions have disclosed divergence of views in respect of the same. The Commission has revised the Act comprehensively so as to make its provisions more precise, specific, unambiguous and juristically satisfactory. According to the Commission, almost every phrase used in the Act has given rise to problems of interpretation and judicial decisions have disclosed divergence of views in respect of the same. The Commission has revised the Act comprehensively so as to make its provisions more precise, specific, unambiguous and juristically satisfactory. It is proposed to replace the existing Act by a new Act based on the recommendations of the Law Commission.' 'The new Act has made some important changes. One of the important changes is that the expression 'court' is defined to include a tribunal and an arbitrator. Debt is defined as meaning any liability for an ascertained sum of money, including a debt payable in kind, but not including a judgment debt. Section 3(1) enables the court, if it so thinks fit, to award interest, in any proceeding for the recovery of any debt or damages or in any proceeding in which a claim for interest in respect of any debt or damages already paid is made, to the person entitled to the debt or damages or to the person making such claim, for the whole or part of the following period: (a) if the proceeding relates to a debt payable by virtue of a written instrument at a certain time, then, from the date when the debt is payable to the date of institution of the proceedings; (b) if the proceeding does not relate to any such debt, then from the date mentioned in this regard in a written notice given by the person entitled or the person making the claim to the person liable that interest will be claimed, to the date of institution of the proceeding. Section 3(3) provides that nothing in the section shall apply in relation to (i) any debt or damages upon which interest is payable as of right, by virtue of any agreement; or (ii) any debt or damages upon which payment of interest is barred by virtue of an express agreement. Section 3(3)(c) provides that nothing in the section shall empower the court to award interest upon interest. Section 3(3)(c) provides that nothing in the section shall empower the court to award interest upon interest. Section 4(1) provides, 'notwithstanding anything contained in Section 3, interest shall be payable in all cases in which it is payable by virtue of any enactment or other rule of law or usage having the force of law.' Section 4(2) further provides, notwithstanding anything as Section 4 [sic as aforesaid, and without prejudice to the generality of the provisions of sub-section (1)], the court shall allow interest in the class of cases specified in the provision. Section 5 provides that nothing in the Act shall affect the provisions of Section 34 of the Code of Civil Procedure , 1908.' 'We may also cite a case where one of the parties is forced to pay interest to a third party, say on an overdraft, consequent on the failure of the other party to the contract not fulfilling the obligation of paying the amount due to them. In such a case also equity may compel the payment of interest. Loss of interest in the place of the right to remain in possession may be rightfully claimed in equity by the owner of a property who has been dispossessed from it.' 13. Counsel for the respondent relies on the decision in Union of India & Ors. Vs. M/s. Orient Enterprises and another AIR 1998 SC 1729 , on the proposition that no writ petition for seeking the relief of payment of interest on delayed refund of the amount could be maintained. It was held by the Hon'ble Supreme Court that till the insertion of Section 27-A in the Customs Act by Act 22 of 1995 there was no right entitling payment of interest on delayed refund under the Act. Such a right was conferred for the first time by the said provisions and thus at the relevant time there was no statutory right entitling the respondents for payment of interest on delayed refund and the writ petition filed by them was not for the enforcement of a legal right available to them under any statute. Such a right was conferred for the first time by the said provisions and thus at the relevant time there was no statutory right entitling the respondents for payment of interest on delayed refund and the writ petition filed by them was not for the enforcement of a legal right available to them under any statute. It was a case where the company was issued show cause notice to the effect that the goods imported by the company were liable to confiscation as the import was contrary to the provisions of Import Policy and gave option to the company to redeem the same for payment of redemption amount. The redemption amount was deposited was deposited and delivery of the goods was obtained. The appeal filed was allowed by the Tribunal. Special appeals were dismissed and the amount deposited towards the fine was refunded to the company. The writ petition was filed for claiming the relief of interest on the amount from the date of deposit till actual refund made. The Hon'ble Supreme Court had held that at the relevant time there was no legal right said to have been infringed. 14. The facts in the present case are distinguishable. In the case of Union of India and others Vs. MIs Orient Enterprises and another (supra) the redemption amount of fine was deposited by the company. A quasi-judicial order having been set aside, the company was entitled to refund of the amount only. But in the present case, the petitioner was entitled to the subsidy on the circulars issued by the Central Government and other institutions which were payable in the year 1986. For the reason that such subsidy had been stopped with effect from the subsequent dates, it was held by this court that it was the duty of the State authorities to have paid the subsidy if the application of the establishment had been made prior to the date. The mandamus having been given, the Central Government had paid the subsidy after reconsideration of the matter which was to be paid in the year 1986. The petitioner was deprived of his money of Rs. The mandamus having been given, the Central Government had paid the subsidy after reconsideration of the matter which was to be paid in the year 1986. The petitioner was deprived of his money of Rs. 13.50 lacs unlawfully as has been held by this court in the writ petition filed by the petitioner and had the amount been paid to the petitioner, the petitioner would have deposited the amount with the lending agency and could have saved his payment of interest. The petitioner did suffer. Even though the petitioner is claiming the compensation at the rate of percentage of interest as mentioned in the writ petition, but actually what the petitioner is claiming, interest on the money which was illegally refused to be paid to the petitioner. It was not a case of any refund. The company was duty bound to make the payment in the year 1986. The company had retained the amount which should have belonged to the petitioner in the year 1986 itself. Under the Interest Act if any amount or any debt or any transaction which is to be complied with in making of the payment but the payment not having been made, interest is accruable. There is no escape from the conclusion that the petitioner is entitled to the award of the interest from the date it was refused till the actual payment. 15. For the reasons mentioned above, the writ petition is to be partly allowed to the extent that the petitioner shall be paid interest on the subsidy amount from the period after three months of the subsidy amount had become due and till the payment i.e. February 1997 @ 12% p.a. and not on the rate as has been now claimed by the petitioner. The contention of the petitioner of the fact that he should be allowed the same rate which he had paid to his financial institution cannot be accepted. It was not the financial institution which had to take decision on the payment of the subsidy, but it was the Central Government and thus in my opinion interest @ 12% p.a. is sufficient to meet the ends of justice in the present case which shall be paid on the amount of subsidy so released from three months after the due date of subsidy having become due till actual date of payment.The petition is disposed of with the above-said observations. Costs are assessed at Rs. 2,000/-.Petition Partly Allowed. *******