Printing of the condition of interest without any consequential claim in case of delay while making follow-up for the payments cannot support the contention of interest claim – North Agro Industries Pvt. Ltd. Vs. Mahindra and Mahindra Ltd. – NCLT Mumbai Bench
August 16, 2023
NCLT Mumbai Bench held that: (i) If the Operational Creditor had not notified to the Corporate Debtor at the time of supply of goods or prior to it that it is registered under MSME Act, the Corporate Debtor cannot be fastened with obligation to make payments in accordance with MSME Act, and consequently cannot be made liable to pay interest @ 3 times of RBI lending rate as claimed by the Applicant. (ii) As regards contentions of the Applicant that the invoices contained the stipulation of interest @24% p.a., this Bench finds that the Applicant has neither intimated about the levy of interest consequent to delayed payments nor raised any debit note. (iii) There exists prior dispute in relation to deficiency in the goods and claim of benefit under MSME Act. (iv) IBC proceedings cannot be used for recovery proceedings or for tangential goals. The intention of the legislation was never to allow this form of abuse of the IBC by extortionists such as the Applicant to harass and intimidate legitimate corporates such as the Corporate Debtor.