Hi Rumesh88,
I thought the same at first too. Replaced the vacuum switch (it had a problem of not cutting out vacuum once I turn off the AC, too) and replaced all the hoses with new ones. Still the problem is there. I think the diaphragm inside the unit is leaking, hence the arm is not pulled all the way inside to pull the throttle to the required position. If I keep on advancing the engine from the carburetor, at a certain point the pull is enough to compensate the AC compressor load and the problem disappears. (then again the engine is too advanced when the A/C turns off)