Invoice-only interest cannot enlarge operational debt or sustain a Section 9 insolvency application below the statutory threshold.

Interest mentioned only in invoices, without any contract or established course of conduct showing acceptance or payment, cannot be added to operational debt under the Insolvency and Bankruptcy Code, 2016. A unilateral invoice term does not create an enforceable interest liability where mutual consent is absent, and the claimed interest cannot be clubbed with the principal sum to satisfy the statutory default threshold for a Section 9 application. The dispute over interest also indicates a bona fide dispute on enforceability. As the principal outstanding remained below the threshold, the Section 9 application was not maintainable.

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Issues: Whether interest mentioned only in invoices, without any contractual agreement or established course of conduct showing acceptance or payment, can be added to operational debt for computing the threshold under the Insolvency and Bankruptcy Code, 2016 and sustaining a Section 9 application.

Analysis: The invoices alone did not establish a binding entitlement to interest. There was no formal agreement between the parties providing for interest on delayed payment, and no past practice of interest being paid by the corporate debtor. In such circumstances, unilateral insertion of an interest clause in invoices could not override the absence of mutual consent or create an enforceable liability. The claimed interest therefore could not be clubbed with the principal outstanding to cross the statutory minimum default threshold. The dispute over interest also constituted a bona fide dispute on enforceability.

Conclusion: Interest stated only in the invoices was not includible in operational debt, and the Section 9 application was not maintainable as the principal outstanding remained below the statutory threshold. The appeal failed.

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