HIND LEVER CHEMICALS LIMITED Vs. UNION OF INDIA

JUDGEMENT

(1.) In this petition the petitioner has, inter-alia, prayed for the issuance of a writ of mandamus commanding and/or directing the respondents to release the entire subsidy/concessional amount to the petitioner company on the basis of sales of fertilizers made to registered dealers in the state of Bihar. The petitioner has also prayed for a writ, order or direction directing the respondents 5 & 6 (State of Bihar and Director of Agriculture, State of Bihar) to complete the sales certification process in respect of fertilizer sales made by the petitioner company in the state of Bihar and to submit Proforma-B to the respondent No.1 (Union of India) strictly within a period of 45 days from the date of receipt of the subsidy claims from the petitioner company in Proforma-A with regard to subsidy claims lodged for the period 1.11.2001 onwards. The petitioner has also prayed for a direction directing the respondent No.1 to pay to the petitioner company a sum of Rs.75.28 crores (approximately) representing the outstanding subsidy sum of Rs.60.63 crores alongwith interest thereon and further interest till actual payment to the petitioner company.

(2.) The petitioner has been manufacturing and marketing phosphatic and potassic fertilizers under the brand name "PARAS" for over 15 years. The petitioner company has its own complex of fertilizer manufacturing plants located at Haldia in the state of West Bengal and has been supplying fertilizers in several states, including Bihar. The entire grievance in the present petition is with regard to the supply and sale of fertilizers in the state of Bihar. It is stated in the petition that the operations in Bihar started with the single product "Di-Ammonium Phosphate (DAP)" and subsequently the petitioner expanded operations in Bihar to sell various other types of fertilizers and the petitioner now sells DAP, MOP (Muriate of Potassium), SSP (Single Super Phosphate) and MPK (complex fertilizers), etc. About 1/3rd of the total production of the fertilizers of the petitioner is sold in the state of Bihar and in the year 2000 the petitioner's sales were over 3 lakh metric tonnes of fertilizers in the state of Bihar.

(3.) In 1977 a scheme for price control of fertilizers was introduced. This scheme was discontinued by the Central Government in 1992 in respect of phosphatic fertilizers. However, as the de-control of phosphatic fertilizers was found to be counter to the interest of the farmers, the Central Government reintroduced a type of price control on such fertilizers through a scheme of subsidy/price concession by issuing guidelines on 16.06.1993. These guidelines were entitled "GOI Guidelines for Scheme of Concession on Sale of Decontrolled Fertilisers to Farmers during 1993-94" . Under these guidelines the product-wise concessions were specified as under:- <FRM>JUDGEMENT_526_ILRDLH12_2003Html1.htm</FRM> It was indicated in paragraph 2 of the said guidelines that while prices were no longer under statutory control, the intention of the Government for extension of concession for decontrolled fertiliser under the scheme was to bring down prices of these fertilisers to a level comparable and competitive with the prices at which the imported products were being sold. It was, therefore, provided therein that the State Governments must continuously monitor the market prices of imported products while implementing the scheme. The expected sale prices to farmers after concession were indicated as under:- <FRM>JUDGEMENT_526_ILRDLH12_2003Html2.htm</FRM> The idea behind the scheme was that if manufacturers sold fertilisers at the suggested prices, then they were entitled to the concessions at the rates specified above. These rates of concessions and suggested prices have been altered from time to time but the principle remains the same.