Debt Recovery Interest Calculator
Compute legally entitled statutory, contractual, and penal interest on unpaid commercial debts, invoices, and defaulted loans under Indian Law.
Enter Debt & Default Parameters
Total Statutorily Recoverable Claim
MSME Facilitation Council (MSMED Act 2006) + Section 16 Statutory Demand Notice
Legal Basis & Statutory Explanation
In India, claiming interest on unpaid commercial debts is an established statutory right under multiple legislative enactments:
1. MSMED Act, 2006 (Section 16)
Mandates that buyers who fail to pay an MSME within the agreed period (or within 45 days) are liable to pay compound interest with monthly rests at three times the RBI bank rate. This rate overrides any contrary agreement between the parties.
2. Negotiable Instruments Act, 1881 (Section 80)
Where no rate of interest is specified in a promissory note or bill of exchange, interest shall be calculated at the statutory rate of 18% per annum from the date at which the instrument ought to have been paid.
3. Code of Civil Procedure (Section 34 & Order 37)
In commercial suits, the court has the discretion to grant pre-suit, pendente lite, and future interest up to the contractual commercial rate, typically ranging between 12% and 18% per annum.
4. Interest Act, 1978
Grants courts the power to award interest on debts from the date written notice is served claiming interest, reinforcing the vital necessity of serving an immediate formal Advocate Demand Notice.
Important Legal Disclaimer
This calculator is designed strictly for informational, educational, and preliminary estimation purposes. Calculations do not constitute formal legal advice, a binding assessment, or an attorney-client relationship. The actual interest rate awarded by courts or arbitration tribunals is governed by the specific contractual terms, evidence, judicial discretion under Section 34 CPC, and the specific facts of each case. For an enforceable claim assessment, please consult our Bar Council certified advocates.
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