If Interest On Principal Amount Crosses Threshold Limit, Application U/S 7 Of IBC Can Be Admitted: NCLAT
The NCLAT Delhi bench of Justice Yogesh Khanna and Mr. Ajai Das Mehrotra has affirmed that if interest on the principle amount disbursed to the corporate debtor crosses the threshold limit as provided under section 4 of the IBC, application under section 7 of the code can be admitted as interest is considered to be a disbursal against time value of money under section 5 of the code. The Corporate Debtor had not paid any amount towards interest though it has deducted TDS which is also reflected in Form 26AS of Income Tax Department as Tax deducted at source on behalf of the Financial Creditor.The total amount of debt and interest payable by the Corporate Debtor as on 31.03.2022 amounts to Rs. It was further submitted that there was no agreement, the demand for interest is illegal and contrary to the law and that the TDS was deducted and deposited by the Corporate Debtor at the request of the Financial Creditor so that they can put their accounts in order and that application under Section 7 is filed on 30.05.2022 which is beyond 3 years of disbursal of funds and is time barred. NCLT has rightly admitted the Corporate Debtor in CIRP on an application under Section 7 of IBC, 2016 filed by the Financial Creditor.
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