Operational debt in a running account was upheld where balance confirmation supported default under insolvency law.

Operational debt under the Insolvency and Bankruptcy Code was found to arise from invoices evidencing purchase and sale of gold bars, with payments reflected in a running account rather than invoice-wise settlement. The balance confirmation dated 12.02.2019 was relied on to support the outstanding liability, and the record did not substantiate the claim that the amounts were only advances or that any pre-existing dispute existed. On that basis, default was treated as established and the admission under Section 9 was upheld; the appeal was dismissed.

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Issues: Whether the operational creditor had established an operational debt and default under Section 9 of the Insolvency and Bankruptcy Code, 2016, in the context of a running account and confirmed outstanding balance.

Analysis: The invoices on record showed transactions of purchase and sale of gold bars between the parties, and the account reflected periodic payments that were not invoice-wise. The material indicated a running and current account rather than isolated transactions, and the balance confirmation dated 12.02.2019 was relied upon to show the outstanding liability. The contention that the amounts were merely advances and that no services were rendered was found untenable on the record and was not shown to constitute a pre-existing dispute.

Conclusion: The operational debt and default were established, and the admission of the application under Section 9 was upheld. The appeal was dismissed.

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