ORDER

1. Special leave granted.

2. The Government of Assam introduced an Industrial Policy called "Industrial Policy of Assam 1986" (the Policy). The Policy provided power subsidy in the following terms :

"Power subsidy

Power subsidy will be granted as follows :

With regard to the small-scale sector, power subsidy will be granted to the extent of 50% for the first five years of commercial production. There will be no ceiling to the subsidy amount which can be availed of by the small-scale sector.

Subsidy on drawal of power lines :

For the SSI units 50% of the cost incurred on drawal of Electrical Power Line, from the main line to the factory sheds, will be subsidised up to a ceiling of Rs 20,000 for each industrial unit.

Power subsidy :

(a) Power subsidy will be granted as follows :

With regard to the small-scale sector, power subsidy will be granted to the extent of 50% for the first five years of commercial production. There will be no ceiling to the subsidy amount which can be availed of by the small-scale sector.

(b) * * *

(c) Power subsidy will be allowed on actual consumption of power for manufacturing process in respect of the small-scale sector, power actually consumed by the units, except that used for residential purpose will be subsidised.

(d) Existing units undertaking expansion/diversification will also be eligible for power concession for the expanded/diversified part of their activities.

Reimbursement of the subsidy amount will be done directly by the Udyog Sahayak on a quarterly basis."

3. The authority to reimburse the subsidy was Udyog Sahayak, a Branch of the Directorate of the Industries, Government of Assam. The industries entitled to the subsidy were to be given the same for a period of 5 years from the date of the setting up of the industry. The respondent-industry was set up sometime in July 1988 and as such the entitlement of the industry was up to July 1993. It is the case of the industry that no subsidy was paid till December 1993 and as such a writ petition was filed in the High Court in March 1993 seeking a direction to the State of Assam to pay the subsidy in terms of the Policy. The writ petition came for motion hearing before the High Court on 31-3-1993, when the following order was passed :

"Post the petition for order on 26-4-1993 for consideration of the interim prayer. In the meantime, petitioner shall clear the bill dated 11-3-1993 amounting to Rs 6,27,708 within 7 days from today adjusting any amount if already paid by the petitioner against the said bill. It is directed that until further order electricity supply to the petitioner industry shall not be disconnected."

Thereafter the petition came for hearing before the High Court on 18-6-1993. The High Court passed the following order :

"Taking into consideration the hardship faced by the petitioner due to admitted failure on the part of the Government to pay the subsidy, for the ends of justice, in the interim, I direct that Government of Assam shall pay the arrear electricity charges to ASEB as well as current charges payable up to June 1993 within a period of one month from today and the ASEB will receive the payment from the Government. The petitioner, shall, however, be liable to pay the current bills raised for consumption of electricity on and from July 1993. Respondent ASEB is directed not to disconnect the supply of electricity to Petitioner 1 until further order."

4. The High Court finally allowed the writ petition and directed the State Government to pay the subsidy to the respondent-Company in terms of the Policy. Apart from the abovesaid direction, the High Court further held as under :

"The word subsidy means a grant of money made by the Government in aid of the promoters of any enterprise or work, and the expression reimburse means to pay back, to make restoration or to indemnify. Therefore, the petitioner-Company has to pay the energy charges to ASEB and then the Government has to pay