Partly allowed

Mr. S. Pradeep Pandurangan v. Mrs. Deepa

Madras HC19 Jan 2016A/176/2016

Case brief

AI extract

What is this about?

The Court disposed of an application by the Official Assignee seeking 18% per annum interest on a sum of Rs. 5 crores deposited by the second respondent in an escrow account. Holding that no specific agreement existed for such high interest, the Court denied the 18% claim but directed the withdrawal of the deposited amount along with the actual bank interest accrued. The second respondent was disc

What did the court decide?

Application for 18% interest dismissed; directive to withdraw deposited amount and accrued interest for payment to insolvent; second respondent discharged of liability.

Mr. S. Pradeep Pandurangan Vs Mrs. Deepa — Insolvency and Bankruptcy | Madras HC (2016)

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Appln.No.176 of 2016 in I.P.No.25 of 2014

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Appln.No.176 of 2016 in I.P.No.25 of 2014 Dr.G.JAYACHANDRAN,J. &

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C.V.KARTHIKEYAN,J.

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This application for direction to the second respondent to pay a sum

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of Rs.5 crores with interest at the rate of 18% p.a., from 21.04.2014 till the date of realization, is taken up for consideration. On considering the evidence on behalf of the applicant/official assignee, this Court finds that the second respondent pursuant to the filing of this application has deposited Rs.5 crores and the same has been invested in the bank and kept under escrow account which is earning interest.

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The learned counsel appearing for the second respondent submitted that since the principal claim amount has already been deposited and the same is earning interest, the claim of 18% interest is to be rejected.

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The claim made by the insolvent is based on the bank entries. There is no specific agreement by the borrower that he will pay back the money with the interest at the rate of 18% p.a. Therefore, the transaction cannot be presumed to be commercial transaction to claim interest much less 18%.

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https://www.mhc.tn.gov.in/judis

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Appln.No.176 of 2016 in I.P.No.25 of 2014

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This Court is of the view that the claim of 18% interest is therefore

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not sustainable. At the same time, the money advanced by the insolvent is getting interest through the bank from the deposit made by the second respondent.

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In such circumstances, this application is disposed of with a

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direction that the amount deposited in the escrow account along with the accrued interest shall be withdrawn and paid in the account of the insolvent for disbursement to the creditors in future. In the light of the above order, the liability of the second respondent is hereby discharged.

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Accordingly, the Application No.176 of 2016 in I.P.No.25 of 2014

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is partly allowed. No order as to costs.

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[Dr.G.J.J.] [C.V.K.J.] 16.08.2023

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ari

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https://www.mhc.tn.gov.in/judis

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Appln.No.176 of 2016 in I.P.No.25 of 2014

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Dr.G.JAYACHANDRAN,J. & C.V.KARTHIKEYAN,J.

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ari

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Appln.No.176 of 2016 in I.P.No.25 of 2014

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16.08.2023

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https://www.mhc.tn.gov.in/judis

Mr. S. Pradeep Pandurangan v. Mrs. Deepa

Case brief

What is this about?

What did the court decide?

Mr. S. Pradeep Pandurangan v. Mrs. Deepa

Case brief

What is this about?

What did the court decide?

What the court decided

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Issues for consideration

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Parties & counsel

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