Katju wants Govt to pay interest on late payment for ads in print media

NEW DELHI: Press Council of India chairman Markandey Katju has said interest of 12 per cent should be levied if payment for government advertisements is not made to newspapers within a month.

In a letter to the Information and Broadcasting Ministry cabinet secretary and chief secretaries of all states, Justice Katju noted that newspapers and periodicals are made to run from "pillar to post" to get the dues from Government Departments in Central and State Governments and the Union Territories and other authorities.

"Non-compliance of this directive will be taken very seriously by me, and the person or authority concerned will have to face the consequences," Katju said, asking Government departments to make the payments within a month of their advertisements being published in newspapers.

He stressed that the levy of interest per annum should not be taken as "penalty or punishment" and it is the normal accretion of capital. "It may be mentioned that interest is not a penalty or punishment at all. It is the normal accretion on capital. Hence for delayed payment, interest has also to be paid."

Katju said he had noticed a case where no payment was made by Directorate of Advertising and Visual Publicity (DAVP) till date to a newspaper for an advertisement published in 1997.

"In my opinion, this is most improper and unfair. The government or the statutory authority must behave as a role model for the citizens and must make prompt payments for goods or services they receive. If the management of a newspaper or journal receives prompt payment, they can invest it elsewhere and keep the money in circulation. If that is not done, the money is blocked," Katju wrote.