No Automatic Right To Interest Under IBC, Regulation 16A(7) Of CIRP Regulations Does Not Mandate Interest On Principal Amount: NCLT Mumbai

The NCLT Mumbai held that there is no automatic right to interest under the IBC, and Regulation 16A(7) of the CIRP Regulations does not mandate interest on the principal amount of debt during the corporate insolvency resolution process. The tribunal clarified that while interest may be considered as part of the claim, the regulations do not automatically entitle creditors to interest on the principal amount for the duration of the CIRP. Any claim for interest would need to be substantiated and considered based on the specific terms of the debt agreement and the overall resolution plan.