Claimant must establish contractual or documentary basis for interest under IBC.

In brief

The question

1. Whether the Resolution Professional erred in admitting only the principal amount of the Appellants' claims and rejecting the interest component.

The court held

The Appeals are dismissed.

It also directed

The Adjudicating Authority did not err in rejecting the Appellants' application because they failed to prove, by any contractual agreement or documentary evidence, their entitlement to interest on their unsecured loans.

The Resolution Professional's decision to admit only the principal amount was upheld.

01Facts

The Corporate Insolvency Resolution Process (CIRP) commenced against Pushp Ratna Realty Pvt. Ltd.

p. 3

Socrus Bio Sciences Ltd. (Appellant in Comp. App. (AT) (Ins) No. 132 of 2026) and Jayshree Agnihotri (Appellant in Comp. App. (AT) (Ins) No. 134 of 2026) filed their claims as Financial Creditors on 03/06/2025.

p. 4

The Resolution Professional (RP) admitted their claims for the principal amount but rejected the interest component.

p. 5, 6

The Appellants filed I.A/377(MP)2025 and I.A/378(MP)2025 before the Adjudicating Authority, praying for admission of interest at 18% per annum.

p. 7, 15

The Adjudicating Authority rejected these applications, finding that the Appellants failed to establish a contractual or documentary basis for entitlement to interest at 18%.

p. 7, 8, 16

The Appellants contended that a Board of Directors' decision on 03/07/2020 granted 15% interest to an unsecured loan by Mr. Ashok Jain, and that Jayshree Agnihotri's unsecured promoter loan, being similarly placed, should be entitled to the same interest.

p. 10, 12

The RP explained differential amounts in the balance sheets for Jayshree Agnihotri as adjustments for car EMI payments.

p. 20

02Issues

i.1. Whether the Resolution Professional erred in admitting only the principal amount of the Appellants' claims and rejecting the interest component.

p. 13, 23

ii.2. Whether the Appellants established a contractual or documentary basis for entitlement to interest at 18% or any other rate on their unsecured loans.

p. 8, 16, 17

03Law Applied

The court referred to the general principle of equity among creditors recognized in *Swiss Ribbons Pvt. Ltd. v. Union of India* (2019 SCC OnLine SC 73).

p. 17

It emphasized that this principle does not override the statutory requirement of substantiating a financial claim with cogent evidence under Sections 5(8) and 18 of the IBC 2016 read with Regulations 13 and 14 of the IBBI (CIRP) Regulations, 2016.

p. 17

Provisions in the judgment · 3 · Linked ones open on LawLens

Insolvency and Bankruptcy Code, 2016. Section 31 Section 5 Section 18

04Reasoning

The Adjudicating Authority rejected the applications because the Appellants "failed to establish any contractual or documentary basis evidencing entitlement to interest at the rate of 18% or at any rate whatsoever".

p. 8, 16, 17

The Resolution Professional's role is to collate claims based on submitted documents, and finding no such document for interest, correctly admitted only the principal amount.

p. 21

The Appellants did not provide material in their application to prove interest entitlement.

p. 21

While a specific board resolution indicated 15% interest for Ashok Jain's unsecured loan, the admission of Ashok Jain's claim was not the subject matter of the Appellants' application before the Adjudicating Authority.

p. 22

The slight increase in Jayshree Agnihotri's loan over the year 2019-20 was explained by the RP as adjustments for car EMI payments, not interest accrual.

p. 19, 20