TMI Blog2019 (6) TMI 967X X X X Extracts X X X X X X X X Extracts X X X X ..... rohibition to claim interest by operational creditor is envisaged under the Code, as long as such prohibition is absent, the operational creditor obviously can claim interest as envisaged under Sale of Goods Act. As to material placed before this Bench, this Operational Creditor counsel having filed Purchase Orders, Invoices and the Acknowledgements reflecting that this debt is not barred by limitation and section 8 notice being served upon the debtor and the debtor having not disputed anything on the claim amount mentioned by the creditor, this Operational Creditor counsel has proved the existence of debt and default. Petition admitted - Mr. Karuppiah Muruganandan appointed as Interim Resolution Professional - Moratorium declared. - CP/1461/IB/2018 - - - Dated:- 6-5-2019 - MR B.S.V. PRAKASH KUMAR, MEMBER (JUDICIAL) AND MR S. VIJAYARAGHAVAN, MEMBER (TECHNICAL) For The Operational Creditor : Shri Rohan Rajasekaran Mrs. Nandhini Raghunathan Advocate For The Corporate Debtor : None-Present on the date of hearing ORDER Per : MR B.S.V. PRAKASH KUMAR, MEMBER (JUDICIAL) It is a Comp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ler or the buyer to recover interest or special damages in any case whereby law interest or special damages may be recoverable, or to recover the money paid where the consideration for the payment of it has failed. (2) In the absence of a contract to the contrary, the court may award interest at such rate as it thinks fit on the amount of the price- (a) to the seller in a suit by him for the amount of the price-from the date of the tender of the goods or from the date on which the price was payable; (b) to the buyer in a suit by him for the refund of the price in a case of a breach of the contract on the part of the seller-from the date on which the payment was made. 5. Upon reading the Section of law, it is evident that unless there is a provision in the contract debarring the seller/creditor from claiming interest, if consideration towards the goods supplied has not been paid, the seller is entitled to claim interest from the date on which the price was payable. In this case, the Debtor received goods in the year 2011, ever since this part payment remained due outstanding, that apart, this Debtor having not dispu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Corporate Insolvency Resolution Process is not the answer. 8. The points emanate from the factual data available in the finding above are - 1. The claim is only for interest. 2. NCLT dismissed the claim on the ground the petition u/s 9 would not lie for claiming interest alone. 3. When it was appealed before Honourable NCLAT, the order passed by the NCLT was upheld on the ground that the principal was already paid and as per agreement no interest was payable. 4. If interest is to be claimed on delayed payment, the remedy lies before Civil Court, not under section 9 of the Code. 9. The facts of the present case are different from the above finding, the difference is, one - it is not a claim for simpliciter interest on delayed payment; two - it is not a case where the corporate debtor replied to section 8 notice questioning the operational creditor as to how the creditor could claim interest on the unpaid principal for the interest clause is not present in the invoices raised against the debtor; three - the corporate debtor remained absent at the time of hearing of this petition as wel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... remain adding unless it is given for other considerations other than commercial considerations. Two - Credit policy is the breath of business, once it is choked depriving the unpaid creditors claiming interest on unpaid consideration, business will not run minus credit. If interest clause is there in the understanding, such creditor is obviously entitled, even if such clause is not there, then also the claimant is entitled to claim interest as stated in the Sale of Goods Act. To run business, credit is a must, when credit is a must; it must be construed that payment of reasonable interest in commercial parlance is in built in the Credit Policy. For this reason alone, in the year 1930 itself, almost 100 years before that is when the Sale of Goods Act has come into force, it was felt that unless it is explicitly stated that interest shall not be claimed, the seller is entitled to claim interest though it is not stipulated in the contract. 14. I must also say that it is not this corporate debtor only runs its business on credit, so will be the case with operational creditor also, it has also to pay interest to its creditors, if price of goods supplied to debtor is not p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eby state that it cannot be said as prohibition for claiming interest. If prohibition of claiming of interest is the understanding derived from non-mentioning of entitling the operational creditor interest over its claim, then even if agreement provides interest clause, then also it cannot be claimed because prohibition of claiming interest is assumed from the Code. No doubt it is complete Code; it does not mean the Parliament has brought in section 238 of the Code to negate every other law in force, especially which is not inconsistent with the IBC. 19. It might be said that interest shall not be claimed de-hors interest clause binding both the parties, for that matter every day-to-day transactions are based on understanding between two parties, when law says how that understanding works when one party is in violation of it, then it has to be construed whatever that has been said in the law has to read as part of the contract/understanding between the parties, that is how section 61 of Sale of Goods Act is applicable. 20. As to material placed before this Bench, this Operational Creditor counsel having filed Purchase Orders, Invoices and the Acknowled ..... X X X X Extracts X X X X X X X X Extracts X X X X
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