2024 (7) TMI 560 - AT - Insolvency and Bankruptcy

Suit for recovery - application filed u/s 9 of IBC - interest @ 24% is calculated from the date of default till the date of filing suit - HELD THAT - The argument raised by Respondent No. 1 appears to be attractive but in view of the statement made by Respondent No. 1 while appearing in the suit which is already captured in the early part of this order, Respondent No. 1 himself stated that he has received part payment of Rs. 34,00,000/- from the Appellant herein and after giving credit to the said payment, an amount of Rs. 61,18,217/- was remaining which includes principal amount of Rs. 23,70,417/- and interest of Rs. 37,37,710/- @18% p.a. Since, Respondent No. 1 itself has claimed the interest @ 18% which too has been granted by the Hon ble High Court in its judgment decree dated 14.12.2022, therefore, it does not lie in his mouth to claim interest @ 24% on the balance amount. The contention of the Appellant and the calculation submitted by him by way of a chart which is already referred to above is accepted, that the remaining amount to be claimed by Respondent No. 1 is less than Rs. 1 Cr. which does not meet the criteria of the threshold, therefore, the application filed under Section 9 of the Code is not maintainable. The appeal is thus allowed and the impugned order is set aside though without any order as to costs - appeal allowed.

Summary

Issues:
- Appeal against order passed in CP (IB) No. 1193/MB-IV/2020 by the Adjudicating Authority under Section 9 of the Insolvency and Bankruptcy Code, 2016.
- Claim of interest @ 24% p.a. on the principal amount from the date of default.
- Suit filed before the Hon'ble High Court of Bombay for recovery of a specific amount.
- Decree in the suit directing payment of principal amount with interest.
- Discrepancy in interest rates claimed by the Appellant and granted by the Court.
- Calculation of interest affecting the maintainability of the application under Section 9 of the Code.
- Acceptance of the contention regarding the threshold amount for the application.
- Setting aside the impugned order based on the calculation submitted by the Appellant.

Analysis:
The judgment pertains to an appeal against an order passed by the Adjudicating Authority under Section 9 of the Insolvency and Bankruptcy Code, 2016. The appeal challenged the order related to a claim of interest at 24% p.a. on the principal amount from the date of default. The Appellant contended that the interest claimed was not part of the purchase order and disputed the validity of the interest amount. The Court directed notice to the Respondents for scrutiny and ordered the filing of necessary documents within a specified timeline.

The Appellant argued that a suit was previously filed before the Hon'ble High Court of Bombay for recovery, resulting in a decree for payment of the principal amount with a specific interest rate. The discrepancy arose regarding the interest rates claimed by the parties, with the Appellant asserting that the interest calculated at 18% fell short of the threshold amount under Section 4 of the Code. The Court examined the submissions and calculations provided, ultimately accepting the Appellant's contention that the remaining amount claimed by the Respondent did not meet the threshold criteria, rendering the application under Section 9 not maintainable.

The judgment emphasized the importance of the statements made by the parties during the suit proceedings, highlighting that the Respondent's own admission regarding the partial payment and the interest rate granted by the Court played a crucial role in determining the maintainability of the application. Based on the analysis of the arguments and calculations presented, the Court allowed the appeal, setting aside the impugned order without any costs. Additionally, the judgment acknowledged the submission regarding unpaid dues of the IRP, allowing for a separate application to be filed before the Adjudicating Authority in accordance with the law.