IN THE HIGH COURT OF JUDICATURE, ANDHRA PRADESH AT HYDERABAD (Special Original Jurisdiction) FRIDAY, THE ELEVENTH DAY OF JULY TWO THOUSAND AND EIGHT PRESENT THE HON'BLE MR JUSTICE V.V.S.RAO WRIT PETITION NO : 16730 of 2003 Between: The Sirpur Paper Mills Limited, Rep. by General Manager (R.M.), Mr. V.V.S.Prasad, S/o late Dr. V. Hanumantha Rao, R/o Hyderabad. ..... PETITIONER AND 1 The Principal Chief Conservator of Forests, Andhra Pradesh, Aranya Bhavan, Hyderabad. 2 The Divisional Forest Officer, Wild Life Management, Atmakur, Kurnool District. .....RESPONDENTS Petition under Article 226 of the constitution of India praying that in the circumstances stated in the Aﬃdavit ﬁled herein the High Court will be pleased to to issue a Writ of Mandamus or any other appropirate Writ, direction or directions, declaring the proceedings of the 2nd Respondent in Rc. No. 1721/94f/H8 dated 19-7-2003 as illegal, arbitary and unconstitutional and to issue a consequential direction to the Respondents not to proceed against the Petitioner for recovering of the alleged amount of interest onthe extraction charges without ﬂollowing due process of law as per Section 70 of the A.P. Forest Act, and pass Counsel for the Petitioner: MR.V.SRINIVAS Counsel for the Respondents: GP FOR FORESTS The Court made the following Order: THE HON'BLE SRI JUSTICE V.V.S.RAO WRIT PETITION No.16730 of 2003 ORDER: The Sirpur Paper Mills Limited (SPML) is a company engaged in manufacture of paper and paper boards. They purchased main raw material/bamboo from forest divisions in Adilabad, Guntur, Kurnool and Warangal Districts. Whenever the department of forests itself extracts bamboos as industrial cuts, stacks them, makes them into bundles, they are picked up by the company. When bamboo is supplied as extracted by the department extraction charges in addition to selling charges are levied. During the period from 1991-1996 the respondents supplied bamboo under an agreement entered into with the petitioner. Clause 6 thereof provides for payment of extraction charges. The Divisional Forest Oﬃcer, second respondent herein, issued proceedings in January, 1995, demanding incidental charges and penal interest in addition to extraction charges relating to the period 1993-1994. The petitioner disputed the demand for payment of penal interest. Second respondent herein, therefore, issued a communication dated 19.07.2003 calling upon the petitioner to pay balance amount with penal interest amounting to Rs.3,57,796/-. This is challenged in instant writ petition. In the counter-affidavit filed by second respondent, the contention of the petitioner that the amount towards extraction charges and selling price of bamboos has been paid is agreed. It is, however, stated that as per Clauses 6 and 7 of the supply agreement extraction charges up to the point of delivery have to be paid within ﬁfteen days time. If the amount is not paid within the stipulated time, the petitioner is liable to pay the same with penal interest. This Court heard learned counsel for the petitioner and learned Government Pleader for Forests. It is brought to the notice of this Court an unreported judgment of this Court in Sirpur Paper Mills Limited v Principal Chief Conservator of Forests (W.P.No.9520 of 1999 dated 27.06.2007). In said judgment a similar question has been considered as to whether the respondents are entitled to levy penal interest on extraction charges. The plea of department was negatived by this Court observing as under. In the agreement, there is a speciﬁc provision, namely, Clause 11, which mandates that the selling price for bamboo must be paid before 15th of the succeeding month. It is, in this context, payment of interest is provided on belated payments. Clause 11 of the agreement reads as under: “Selling price for bamboo weighed at the weighbridge during a month shall be paid before the 15th of the succeeding month. Interest at the rate of 22% per annum or at the rate prescribed by the Government from time to time shall be paid by the lessee on all arrears and other amounts payable by the Lessee. In calculating interest, any overdue period of ﬁfteen days and below will be treated as half month and any period of ﬁfteen days and above but less than one month will be treated as one month”. From a reading of this clause, it is possible to contend that it applies not only to selling price but also to other amounts. Even if a liberal interpretation is to be given to this provision, it applies to such amount, as has become due beyond stipulated time. While the agreement had prescribed time for payment of the selling price, no such period is mentioned as regards extraction charges, which are covered by Clause 6 of the agreement. Unless there existed stipulated period, whether under the written agreement or as per practice for payment of a particular amount, it cannot be treated as belated. Further, in the absence of any speciﬁc provision, the payment of an amount can be said to have been belated if only it was preceded by a demand with the speciﬁc assertion that non-compliance of the demand attracts interest. The record does not disclose that any such demand with the threat of levy of interest was made against the petitioner as regards payment of the extraction charges. Even where the liability to pay interest exists, the claim as regards the interest has to be made while receiving the corresponding amount. If the amount is accepted without demur and no amount towards interest is demanded, the recipient of the amount cannot be permitted to make an independent claim for interest at a later point of time. Following the above judgment, which is between the same parties with reference to dealing with payment of penal interest on extraction charges for diﬀerent period, this writ petition has to be allowed. Therefore, the writ petition is allowed. No costs. _____________ (V.V.S.RAO, J) 07th November, 2008 GHN To 1 The Principal Chief Conservator of Forests, Andhra Pradesh, Aranya Bhavan, Hyderabad. 2 The Divisional Forest Officer, Wild Life Management, Atmakur, Kurnool District. 3 2CCs to GP for Forests 4 2CD copies Form-NIC-OGS/WP{MADHURI}