ONGC LIMITED Vs. ASSISTANT OF NATURAL GAS CONSUMING INDUSTRIES
LAWS(SC)-2004-4-139
SUPREME COURT OF INDIA (FROM: GUJARAT)
Decided on April 12,2004

ONGC LIMITED Appellant
VERSUS
ASSN. OF NATURAL GAS CONSUMING INDUS. Respondents

JUDGEMENT

Rajendra Babu, J. - (1.) A batch of writ petitions was filed in the High Court of Gujarat challenging the increase in the price of gas and by an interim order, the High Court directed ONGC to supply gas at the old rate of Rs. 504/- per 1000 M3. Subsequently, by another order made on 29-10-1982, the price was raised to Rs. 1000/- per 1000M3. By an order made on 30-7-1983, the High Court allowed the writ petitions and set aside the price which had been determined by ONGC. Pursuant to a certificate of fitness, appeals were filed in this Court and this Court continued the interim order granted by the High Court and thereby the respondents in the appeals received gas for which they paid a price of Rs. 1000/- per 1000M3.
(2.) This Court, on 4-5-1990, by judgment upheld the prices fixed by ONGC and allowed the appeals. After the appeals were allowed, ONGC became entitled to receive the difference in the price of gas supplied. ONGC, in addition to the said principal amount, also demanded interest thereon in terms of Clause 5.02 of the contract. When payment was not made in accordance with their demands, I.A. Nos. 1-11 and 23-33 were filed in this Court and this Court, by an order made on 6-4-1993, passed the orders for categorising the respondents into three categories. The first category being where the principal amount was allowed to be paid in instalments. Where such offer was not made, this Court made it clear that ONGC was entitled to recover the entire dues. The third category is of such cases where the companies concerned have become sick and proceedings were pending before BIFR under the SICA. Subsequently, it was directed that these IAs will remain pending and would be listed for hearing for directions regarding payment of interest after the principal amount is paid. But in some of the cases, there is no dispute that the payment of principal amount has been made in terms of this Courts order.
(3.) Thereafter, applications in I.A. Nos. 190-200 were filed by ONGC claiming interest on the balance principal amount in terms of this Courts order dated 4-5-1990. This Court, after examining the matter, held as under: "..................ONGC was under an obligation by virtue of the interim orders to comply with the terms of the earlier contracts and to supply gas in the manner provided thereunder. This part of the contract was performed by the ONGC who thus became entitled to recover from the industries the price which had originally been charged by them. For the late payment of the amount, the contract in Clause 5 had contemplated payment of interest at the rate and the manner specified therein..........." ;


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