Interest Calculator
Simple or compound interest on any principal over any period — useful for decrees, maintenance, refunds, and claims.
Interest type
Interest in Indian legal proceedings
Interest arises in litigation in several contexts: contractual interest specified in an agreement, statutory interest under specific Acts, and court-awarded interest under the Code of Civil Procedure, 1908.
CPC Section 34 — decree interest
Section 34 empowers a civil court to award interest on the principal sum adjudged in a money decree. The provision has two limbs: (a) pre-decree interest, from the date of the suit to the date of decree, at a rate the court deems reasonable; and (b) post-decree interest, from the date of decree to the date of payment, generally capped at 6% per annum under Section 34(2) unless a higher rate is justified.
The Supreme Court has held in numerous cases that Section 34 interest is compensatory — it is meant to compensate the decree-holder for being kept out of the money. Courts look at the prevailing bank rates, the nature of the transaction, and any contractual stipulation when fixing the rate.
Maintenance arrears (Family law)
Arrears of maintenance under the Hindu Marriage Act, 1955, the Code of Criminal Procedure / Bharatiya Nagarik Suraksha Sanhita, or the Protection of Women from Domestic Violence Act, 2005 can carry interest. The rate is typically 6% or at the court's discretion. This calculator lets you compute the accumulated interest on any arrear amount over the period of default.
Cheque-dishonour claims (NI Act s. 138)
A conviction under Section 138 of the Negotiable Instruments Act, 1881 may include an order for compensation under Section 357 of the CrPC / Section 396 BNSS. Separately, civil claims for the cheque amount plus interest are maintainable. Interest from the date of dishonour at a reasonable rate is commonly awarded.
Refund claims (Tax and consumer)
Refund claims under income tax law carry interest under Section 244A of the Income Tax Act, 1961 (0.5% per month or part thereof). Consumer claims may attract interest under Section 39 of the Consumer Protection Act, 2019. This calculator provides the arithmetic; the applicable rate under each statute must be separately verified.
Frequently asked questions
What rate of interest do courts award under CPC Section 34?
Section 34 of the CPC gives courts discretion to award interest at 'such rate as the court deems reasonable' from the date of suit to the date of decree (pendente lite). For post-decree interest, Section 34(2) caps the rate at 6% per annum unless a higher rate is notified by the RBI or the court directs otherwise based on the contract or circumstances. Actual rates vary widely depending on the nature of the claim and prevailing conditions.
Is this calculator specific to any court or jurisdiction?
No. This is a general-purpose arithmetic tool for simple and compound interest calculation. It does not enforce court-specific rate caps or jurisdiction-specific rules. Use it as a computation aid and verify the applicable rate and period with counsel.
How is compound interest different from simple interest?
Simple interest is calculated on the principal only: SI = P × R × T. Compound interest accrues on the principal plus previously accumulated interest. Over the same period and rate, compound interest produces a higher total than simple interest. The difference grows with time and compounding frequency.
What compounding frequency should I use for decree interest?
Indian courts typically award simple interest on decree amounts unless the underlying contract specifies compound interest. Use the 'Simple' option for most decree interest calculations. Compound interest is more relevant for contractual claims where the contract explicitly provides for it.
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