Y. K. Sabharwal,j.

( 1 ) UNDER the Essential Commodities Act, the Fertilisers (Control) Order 1985 (earlier it was fertiliser Control Order, 1957) was enacted to ensure that fertilisers are available to the farmers at a subsidised price. A Scheme was notified on 1st November 1977 under which a fertiliser producing unit was to submit data of its cost of production to Fertiliser Industry Co- ordination Committee (for short ficc ) alongwith other fixed/capital cost related details. FICC was to work out a retention price which is a combination of norms and actuals in regard to the cost of production plus depreciation plus interest plus 12% post tax return on net worth. If the selling price at which a manufacturer is compelled to sell is less than the retention price fixed for the unit, the difference between the two is payable to the manufacturer under the Scheme.

( 2 ) THE petitioners in the year 1978 sought for an industrial licence to set up a plant of Ammonia fertiliser at Taluja. The industrial licence was issued on 5th December 1979. It was agreed between the parties that commercial production in the said plant would commence within a period of 30 months of entering into agreement with effect from 31st December 1979. The said period of 30 months ended on 1st July 1982. The petitioners, however, commenced commercial production of ammonia, which is a fertiliser, from 1st December 1983.

( 3 ) THE aforesaid scheme is applicable to the petitioners. The FICC fixed provisional retention price from time to time and in accordance with the scheme, the petitioners were paid difference between the retention price and the selling price.

( 4 ) THE petitioners claim that sometime after 1986, the cost of production of the petitioner s unit escalated due to increase in price of gas by ONGC, increase in electricity tariff, a revised wage settlement with the Union and various other heads of expenses. The petitioners filed its escalation claims from time to time but the same were not considered by FICC.

( 5 ) THIS petition was filed in February 1992. During the pendency of the writ petition, on 31st March 1992, FICC declared a final retention price. This fixation was retrospective from 1st December 1983. The petitioners claim that final price so fixed was arbitrary inasmuch as it disallows a part of the project cost and also did not take into account several other costs escalation claims made by the petitioner. On 23rd November 1993 this court directed the petitioners to place their claims alongwith other supporting documents for consideration of FICC. The FICC was directed to fix a date for appearance of the parties after receipt of documents from the petitioner. The court directed FICC to afford an opportunity of hearing to the petitioners and expressed the hope that it will take independent decision without being influenced by decisions taken earlier from 1st December 1983 till 24th August 1992. In accordance with the directions of the court, FICC decided the matter.

( 6 ) AFTER decision of FICC the only issues which now survive in this petition are:- i) Project cost disallowance. ii) Reimbursement of Taluja-Tromway transport cost. iii) Interest due to delay in making payments by FICC. We will now consider them seriatim. i) Project Cost Disallowance The capital cost as per the project report was Rs. 55. 35 crores as against the actuals of Rs. 64. 43 crores as indicated in the published accounts of the petitioner s company for 1983-84. The project was to be completed and commercial production started from 1st July 1982. The commercial production actually started on 1st December 1983. There was thus delay of 14 months. According to petitioners this delay occurred on account of reasons beyond their control such as delay of supply of gas from ONGC, non supply of electricity by MSEB, a crane accident and strike/lockouts in major suppliers units. The petitioners also claim that it has been discriminated in the matter inasmuch as in the case of

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