Section 8 Demand Notice under IBC
Serve a demand notice to recover unpaid operational debt from a corporate debtor under Section 8 of the Insolvency and Bankruptcy Code, 2016.
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Overview of Section 8 Demand Notice
Under the IBC, an operational creditor must issue a demand notice (Form 3) to a corporate debtor before initiating insolvency proceedings. The notice outlines the total unpaid amount, transaction details, due date and amount claimed. The debtor has 10 days to respond by paying or disputing the debt.
Key Provisions of Section 8
Section 8 requires the debtor to respond within 10 days with proof of payment or evidence of an existing dispute, legal or arbitration proceedings begun before notice receipt. Failure to respond allows the creditor to file for insolvency resolution under Form 5 before the NCLT.
Why Issue a Section 8 Demand Notice
● Provides the debtor a fair opportunity to clear dues without insolvency ● Ensures compliance with IBC requirements ● Preserves operational relationship before formal proceedings ● Establishes clear record of demand for tribunal application
1. Documents Required for Section 8 Demand Notice
● Invoices relating to the unpaid operational debt
● Form 3 demand notice draft
● Details of operational creditor and corporate debtor
● Proof of default from information utilities (if any)
● Any security or contract documents supporting the claim
● Certificate of incorporation of the debtor
Procedure to Serve Section 8 Demand Notice
● Draft Form 3 notice with total unpaid amount, transaction details, due date and amount claimed
● Attach relevant invoices and proof of debt
● Serve the notice on the corporate debtor by hand or registered post
● Debtor must respond within 10 days by payment or disputing the claim
● If no response or dispute, file insolvency application (Form 5) before NCLT
Fees for Demand Notice and Insolvency Application
Filing fee for Form 3 is nominal. Tribunal application (Form 5) fee varies with authorized share capital or debt amount.
Timeline under Section 8
Key timeframes for notice and subsequent insolvency proceedings:
Notice Period
10 days
Debtor must respond to demand notice
Tribunal Application
Immediately after 10-day period
File Form 5 with NCLT if no response or dispute
NCLT Decision
14 days
NCLT admits or rejects insolvency application
Resolution Process
180 days (extendable)
Insolvency resolution to be completed
Appeal Timeline
30 days
File appeal before NCLAT
Why Choose DoStartup for Section 8 Notices
Expert drafting of Form 3 demand notices
Compliant service to corporate debtors
End-to-end support through insolvency application
Legal expertise in IBC processes
Fast turnaround on notice preparation
Guidance through NCLT procedures