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TMI Blog2007 (11) TMI 400X X X X Extracts X X X X X X X X Extracts X X X X ..... it has been decided to act as per decision taken in Lord Krishna Textile Mills. Reference was also made to letter dated 3-3-2003 of the Special Secretary, Government of Uttar Pradesh addressed to BIFR. In the circumstances, the matter is remitted to the High Court with the following directions that the BIFR shall be moved by the parties to clarify whether delayed payment surcharge is included in interest or the damages in view of the conceded position that no interest was levied. The order of the BIFR shall be placed on record before the High Court. The parties shall move the BIFR within one month and BIFR is requested to pass necessary orders within two months thereafter.The effect of waiver in case of Lord Krishna Mills case shall be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e (totalling to Rs. 88,02,577.25) was raised." 4. Stand of the appellant was that the demand of late payment surcharge is contrary to the scheme approved on 5-2-2000 by the Board for Industrial and Financial Reconstruction (in short BIFR ). According to para 5.04 there was no scope for charging late payment surcharge because the scheme clearly provided for interest and damage. This plea was resisted by U.P. Corporation Ltd. It was the stand of the Corporation that there was no scope for writing off late payment surcharge and in any event, the same was not part of the approved scheme. The appellant had stated that the principal amount has been paid in full. 5. The appellant had pointed out that in the case of Lord Krishna Mills, ano ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o far as Lord Krishna Mills case is concerned and, therefore, the High Court was not justified in refusing to grant relief. 9. Learned counsel for the Corporation supported the judgment of the High Court stating that late payment surcharge is different from interest or damage and, therefore, the same could not have been waived. 10. There is no doubt about the binding effect of the scheme. The approved scheme was circulated and relevant clauses 5.03 and 5.04 read as follows: "5.03 State Government (Uttar Pradesh): ( i )To declare NTCUPL and its mills as Relief Undertaking for the purpose of granting reliefs concessions including sales tax, holiday deferment etc. ( ii )To approve without any condition the sale of surplus land p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) has no application because the decision in that case related to surcharge on energy charges. If there was any doubt about the true effect of clauses 5.03 and 5.04 the matter could have been highlighted before the BIFR and could have been clarified. In fact, sub-sections (8) and (9) of section 18 of SICA throw considerable light on the issue. They read as follows: "18. Preparation and sanction of Schemes ****** (8) On and from the date of the coming into operation of the sanctioned scheme or any provision thereof, the scheme or such provision shall be binding on the sick industrial company and the transferee company or, as the case may be, the other company and also on the shareholders, creditors and guarantors and employees of the s ..... X X X X Extracts X X X X X X X X Extracts X X X X
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