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2012 (12) TMI 391 - HC - Companies LawClaim of Excise Department - Liability to pay Interest on principal amount - co. in liquidation - non-availability of funds - held that:- Central Excise Department is only a preferential creditor and his debt has to rank after the payment has been made to the secured creditors and to the workmen; Provident Fund Commissioner is to rank in a still higher priority; further submission being that as on date in view of the financial status of the company, no interest is payable by the company. In the present case admittedly no interest was agreed upon between the parties; argument of the respondent is to the effect that Section 11AA of the Act is operative by law and interest becomes payable in view of this statutory provision. Rule 156 envisages a situation where no rate of interest has been agreed upon between the parties. It postulates that interest can be paid up to a maximum of 4%. where the Official Liquidator has a surplus after payment in full of all the claims which are admitted to proof. It is only where an excess amount is available that the question of payment of interest will be considered as per Rule 179. As on date as is the submission by the Official Liquidator, Rs.2,20,00,000/- is lying with him out of which Rs.35 lacs has to paid to the workmen. The claim of the Central Excise has been admitted to Rs.1,85,04,400.76; the liability of the company today would thus be almost Rs.2,20,00,000/-. Keeping in view of the fund position, no fund is available with the Official Liquidator to consider the payment of interest to the Department. Claim of interest of the Department (Central Excise) dis-allowed - application has become infructuous and disposed of.
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