In Brief
The Supreme Court held that interest on unpaid disgorgement and penalty orders under the SEBI Act can be charged prospectively from 25.8.2014 onwards under Section 28A read with Section 220 of the Income Tax Act, 1961, and in equity under the Interest Act, 1978. However, when an original disgorgement order does not expressly provide for future interest till payment—as opposed to quantified interest up to a specific date—no such future interest can be recovered. The Court distinguished between substantive law (interest) and procedural law (recovery mechanisms). In the disgorgement case, since the order did not contain language for future interest (unlike similar orders by the same officer), no interest beyond that quantified to 21.7.2009 was payable. For penalty cases, interest is awardable in equity from the cause of action, but only prospectively from 25.8.2014.
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