Interest On Operational Debt Cannot Be Claimed If There Is No Clause In Agreement For Payment Of Interest: NCLAT

The NLCAT New Delhi bench of Justice Ashok Bhushan and Barun Mitra held that no interest on principal amount can be claimed if there is no clause to this effect in the agreement executed between the parties. The RP has also filed reply to the Supplementary Affidavit, which was filed by the Appellant, with regard to interest, it was pleaded in the reply that there is no clause of payment of interest on delayed payment in the Sub-contract Agreement entered in 16.06.2010. Per contra, the respondent submitted that in the Sub-contract Agreement entered between Corporate Debtor and the Appellant, there was no Clause for any payment of interest. There being no clause in the Agreement to include the interest on the delayed payment, no error was committed by the Adjudicating Authority, refusing to accept the claim of the Appellant towards interest on the operational debt, which was claimed by the Appellant. The tribunal while agreeing with the findings of the NCLT observed that with regard to claim under the MSME, the Adjudicating Authority has observed that NCLT is not appropriate Forum to consider the issue pertaining to the interest, claimed by the Appellant under Section 16 of the MSMED Act therefore the interest under this section cannot be claimed before the NCLT.