On 15.7.2022, the Hon’ble Principal Bench of National Company Law Appellate Tribunal, New Delhi, has held that that the total amount for maintainability of claim will include both principal debt amount as well as interest on delayed payment which was clearly stipulated in the invoice itself.[1]
Vikash Parasrampuria- Sole Proprietor of ‘Chiranjilal Yarns Trading’ the Operational Creditor (in short OC) is supplier of different type of yarns and has supplied goods to Bombay Rayons Fashions Ltd. who is the Corporate Debtor herein (in short CD). The OC has raised invoices between March, 2017 and January 2020, wherein, OC supplied goods for Rs. 2,02,26,017/- under nine invoices. The CD has paid three invoices with substantial delay; for one invoice part payment made and remaining five invoices, CD has failed to make any payment.
Based on above position, the Adjudicating Authority admitted the Section 9 application and approved initiation of CIRP along with appointment of IRP.
Aggrieved by Impugned Order Appellant- Mr. Prashant Aggrawal, Member of Suspended Board of Bombay Rayon Fashions Limited has preferred Appeal before this Tribunal.
All 9 invoices clearly stipulated provision of Interest on delayed payment. Payments of three invoices has been made in full and for one invoice in part against said invoices by CD and no dispute on this clause was ever raised as noted from record available before the Appellate Tribunal.
Hon’ble Appellate Tribunal referred the legal definition of debt as per section 3(11) of IBC is as under:-
3(11) “debt” means a liability or obligation in respect of a claim which is due from any person and includes a financial debt and operational debt.”
Since, the word “claim” is mention in definition of debt in Section 3(11) we need to refer to definition of claim under Section 3(6) of IBC which is as follows:-
“3.(6) “claim” means
(a) a right to payment, whether or not such right is reduced to judgment, fixed, disputed, undisputed, legal, equitable, secured or unsecured;
(b) right to remedy for breach of contract under any law for the time being in force, if such breach gives rise to a right to payment, whether or not such right is reduced to judgment, fixed, matured, unmatured, disputed, undisputed, secured or unsecured;
Since, interest on delayed payment was clearly stipulated in invoice and therefore, this will entitle for “right to payment” (Section 3(6) IBC) and therefore will form part of “debt” (Section 3(11) IBC)
Therefore, the total amount for maintainability of claim will include both principal debt amount as well as interest on delayed payment which was clearly stipulated in the invoice itself.
[1] Company Appeal (AT) (Ins) No. 690 of 2022, Mr. Prashant Agarwal vs. Vikass Parasrampuria and Others
DUCTUS EDGE 