Statutory interest on stayed penalty payments remains recoverable where the underlying contravention is ultimately upheld.

Statutory interest remained payable on delayed payment of a competition penalty even though the original penalty order was stayed during appeal. Regulation 5 of the Competition Commission of India (Manner of Recovery of Monetary Penalty) Regulations, 2011 permits simple interest where a demand notice is not paid within the stipulated time, and waiver or reduction is confined to specified circumstances. A stay only postpones enforcement; it does not extinguish the underlying penalty liability. Where the appellate forum ultimately upheld the contravention and merely reduced the penalty amount, the modified liability related back to the original order, and interest for the non-payment period was validly recoverable.

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Issues: Whether interest on penalty was payable despite the stay of the penalty order and the pendency of the appeal before the appellate forum.

Analysis: Regulation 5 of the Competition Commission of India (Manner of Recovery of Monetary Penalty) Regulations, 2011 provides for simple interest where the amount specified in a demand notice is not paid within the stipulated period, and also contemplates reduction or waiver only in specified circumstances. The stay of the original penalty order did not extinguish the liability to pay the penalty; it only postponed enforcement. The appellate order did not set aside the finding of contravention and merely reduced the quantum of penalty, so the modified liability related back to the original penalty order. Applying the principle that a beneficiary of an interim stay must make restitution once the stay is vacated, the delay in payment could not be ignored merely because the demand was challenged and stayed for a period.

Conclusion: Interest on the delayed payment of penalty was payable, and the demand for interest was valid.

Ratio Decidendi: Where a statutory penalty order is stayed pending appeal but the contravention is ultimately upheld, the beneficiary of the stay remains liable to pay statutory interest for the period of non-payment unless the governing order or statute provides otherwise.

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