Operational debt dispute defeats section 9 insolvency claim where invoices, part-payments, and liability were contested.

An application under section 9 of the Insolvency and Bankruptcy Code was found not maintainable because the operational debt was not shown to be clear and undisputed. The corporate debtor denied liability, produced bank statements showing part-payments, and disputed the invoices and the amount claimed; the alleged admission of liability was not supported by the cited email. Insolvency proceedings cannot be used as a debt recovery mechanism where a genuine dispute exists between the parties. The application was therefore rejected for want of an undisputed operational debt.

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Issues: Whether the operational creditor's application under section 9 of the Insolvency and Bankruptcy Code, 2016 was maintainable in the face of the corporate debtor's denial of liability and the existence of a dispute regarding the invoices and payments.

Analysis: The claim arose from running business transactions and the corporate debtor produced bank statements showing part-payments, while also disputing the correctness of the amount claimed. The alleged admission of liability was not supported by the referenced email. An application under section 9 is not meant to recover disputed dues, and insolvency proceedings cannot be used as a substitute for debt enforcement where the debt is not clear and undisputed.

Conclusion: The application under section 9 was not maintainable and was rejected for want of an undisputed operational debt and in view of the existing dispute between the parties.

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