Invoice-based insolvency notices need not state default date separately; curable defects cannot justify rejection of section 9 claims.

For invoice-based operational debt claims, Form 4 need not separately state the date of default, so omission of that date in the demand notice is not fatal to section 9 proceedings. The text also notes that limitation should not be computed mechanically from each invoice date where the invoices contemplate payment on demand with delayed-payment interest, and that rejection under section 9(5)(ii) must rest only on the statutory grounds for refusal. A curable defect cannot be treated as a substantive bar. The impugned order was set aside and the matter remitted for fresh consideration of the section 9 application on merits.

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Issues: (i) Whether an invoice-based demand notice in Form 4 required specific mention of the date of default and whether omission of that date invalidated the section 9 application; (ii) Whether the operational creditor's claim was barred by limitation and whether rejection of the section 9 application was justified under the statutory grounds for rejection.

Issue (i): Whether an invoice-based demand notice in Form 4 required specific mention of the date of default and whether omission of that date invalidated the section 9 application.

Analysis: The statutory scheme permits an operational creditor to proceed either by a demand notice or by an invoice demanding payment, and the form applicable depends on the nature of the operational debt. Where the debt is invoice-based, Form 4 governs and does not require a separate recital of the date of default in the notice itself. The objection that the default date was not separately mentioned in the demand notice or that the application referred to a later date of default was therefore not treated as fatal.

Conclusion: The omission to state a separate date of default in the invoice-based notice did not invalidate the section 9 proceedings.

Issue (ii): Whether the operational creditor's claim was barred by limitation and whether rejection of the section 9 application was justified under the statutory grounds for rejection.

Analysis: The invoices contained terms indicating payment on demand with interest for delayed payment, which supported the view that the dealings were of a continuing nature and that limitation could not be mechanically computed from each invoice date in the manner adopted in the impugned order. Rejection under section 9(5)(ii) is confined to the statutory grounds specified therein, and the defect relied upon by the adjudicating authority was treated as a rectifiable one rather than a substantive bar. The impugned order therefore could not stand.

Conclusion: The limitation objection was not accepted as a valid basis for rejection, and the order dismissing the section 9 application was unsustainable.

Final Conclusion: The impugned order was set aside and the matter was sent back for a fresh decision on the section 9 application on its merits.

Ratio Decidendi: For an invoice-based operational debt proceeding, the prescribed Form 4 need not separately state the date of default, and rejection of a section 9 application must rest only on the statutory grounds of rejection, not on an extraneous or curable defect.

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