Both the NCLT and NCLAT works under IBC where there is no equity jurisdiction – Ranjeet Singh Vs. M/s Karan Motors Pvt. Ltd.- NCLAT New Delhi
The Adjudicating Authority rejected the applications on the ground that since the admitted principal amount has already been paid by the Corporate Debtor, therefore there is no occurrence of default and no debt is due. Hence, in absence of any claim between the parties the Appellant cannot claim interest at the rate of 18%.
NCLAT upheld the decision of the AA and held that in view of the judgment passed by Hon’ble Supreme Court in Pratap Technocrats (P) Ltd. (2021) ibclaw.in 148 SC, we are conscious of the facts that both the NCLT and NCLAT works under IBC where there is no equity jurisdiction and we are bound by the provisions of the IBC while adjudicating the matters under IBC. The Ld. Adjudicating Authority have rightly dismissed the Applications under Section 9 of the IBC filed by the Appellants by observing that “if for delayed payment applicant(s) claim any interest, it well be open to them to move before a court of competent jurisdiction for recovery of interest, but initiation of Corporate Insolvency Resolution Process is not the answer.”
