No Interest Can be Claimed In Insolvency Petition Without Prior Intimation to Corporate Debtor: NCLT

The National Company Law Tribunal (NCLT) in Bengaluru ruled that no interest can be claimed in an insolvency petition without prior intimation to the corporate debtor. The case involved Janus GBAC Ltd., an operational creditor, against Beloorbayir Biotech Ltd. The tribunal emphasized that interest claims must be explicitly agreed upon in the contract between the parties. The absence of such an agreement or prior intimation to the debtor invalidates the interest claim in insolvency proceedings. This decision underscores the importance of clear contractual terms and proper communication between creditors and debtors in insolvency cases. The ruling aims to ensure fairness and transparency in the insolvency process, preventing creditors from making arbitrary interest claims without the debtor’s knowledge or consent. The NCLT’s decision highlights the need for operational creditors to adhere to contractual obligations and procedural requirements when filing insolvency petitions.