Section 8 explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Section 8 is the first step for an operational creditor. It lets the creditor deliver a demand notice (or a copy of an invoice) on the corporate debtor after a default, and it gives the corporate debtor ten days to bring a dispute or proof of payment to the creditor's notice. This article reads it as per the IBBI consolidated text of the Code amended up to 12 August 2021. The Insolvency and Bankruptcy Code (Amendment) Act, 2026 does not amend section 8.
An operational creditor may, on the occurrence of a default, deliver a demand notice or a copy of an invoice demanding payment to the corporate debtor in the prescribed form and manner. The corporate debtor has ten days from receipt to bring to the creditor's notice an existing dispute (or a pending suit or arbitration), or payment of the unpaid operational debt, with the proof the section lists.
Sub-section (1): the demand
Section 8(1) says an operational creditor "may, on the occurrence of a default, deliver a demand notice of unpaid operational debt or copy of an invoice demanding payment of the amount involved in the default to the corporate debtor in such form and manner as may be prescribed". The text prints "unpaid operational debtor copy"; this is a spacing slip for "debt or copy" and is flagged here, not corrected.
Four points come from the words:
- The word is "may": the section gives the creditor a right to deliver the notice.
- The trigger is "the occurrence of a default". Default and operational debt are defined in section 3 and section 5; see our articles on default and operational debt.
- The notice can be a demand notice or a copy of an invoice.
- The form and manner are prescribed. The Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016 are the rules for sections 7, 8, 9 and 10 as the first lines of the copy consulted say; the copy consulted is amended up to 24 September 2020. Nothing else from the Rules is taken here.
Creditors drafting this notice can use a legal notice drafting service so the amount, the default date and the demand are stated cleanly.
Sub-section (2): the ten-day reply
Section 8(2) requires the corporate debtor, "within a period of ten days of the receipt of the demand notice or copy of the invoice", to bring to the creditor's notice one of two things:
| Clause | What the corporate debtor brings to notice |
|---|---|
| (a) | the existence of a dispute, if any, or the record of the pendency of the suit or arbitration proceedings filed before the receipt of such notice or invoice in relation to such dispute |
| (b)(i) | payment of the unpaid operational debt by sending an attested copy of the record of electronic transfer of the unpaid amount from the bank account of the corporate debtor |
| (b)(ii) | payment of the unpaid operational debt by sending an attested copy of the record that the operational creditor has encashed a cheque issued by the corporate debtor |
Two details deserve attention. First, the suit or arbitration in clause (a) must have been "filed before the receipt of such notice or invoice". Second, the two modes of showing payment are specific: an attested copy of the electronic-transfer record or of the record that the cheque was encashed. "Dispute" is defined in section 5(6) as including a suit or arbitration relating to the existence of the amount of debt, the quality of goods or service, or the breach of a representation or warranty.
The Explanation: what a demand notice is
The Explanation says that, for the purposes of the section, "demand notice" means "a notice served by an operational creditor to the corporate debtor demanding payment of the operational debt in respect of which the default has occurred."
Example. Verma Packaging supplies cartons to Zenith Appliances Private Limited and raises an invoice for Rs 12 lakh that falls due on 30 April. On 5 May Verma delivers a demand notice. Zenith has ten days from receipt. If Zenith had already filed a suit about the quality of the cartons before receiving the notice, it can bring the record of that suit to Verma's notice. If it paid by bank transfer, it can send an attested copy of the transfer record. If it does neither within ten days, the section is silent on what follows; the next step lies in section 9 (see our post).
What the section does not say
Section 8 does not say what the Adjudicating Authority does with an uncontested demand, how a dispute is tested, or what follows if the ten days pass; those are matters for section 9 and are not taken up here. It does not name a form, a fee or a mode of delivery beyond "prescribed". And it speaks only of an operational creditor: a financial creditor starts the process through section 7 with no demand notice. On the contrast between the two creditors, see financial creditor vs operational creditor.
The Amendment Act, 2026 (No. 6 of 2026) changes section 9 but leaves section 8 as printed; it comes into force on the date or dates the Central Government notifies, and the notification is not in the texts consulted, so check whether any related change has been notified. Amendments and notifications made after 12 August 2021, other than the Amendment Act, 2026, are not in the texts consulted and should be checked.
Need help with a demand notice or a reply?
A notice that misstates the amount or the default date creates trouble later, and a reply that misses the ten days loses the chance to put a dispute or payment on record. Our team can help with a legal notice for the creditor, or a measured reply for the corporate debtor.
Key takeaways
- Only an operational creditor sends a demand notice; it may be a notice or a copy of an invoice.
- The corporate debtor has ten days from receipt to bring a dispute, a pending suit or arbitration, or proof of payment to notice.
- Proof of payment is an attested copy of the electronic transfer record or of the record that the cheque was encashed.
- The suit or arbitration must have been filed before receipt of the notice or invoice.
- The 2026 Act leaves section 8 unchanged.
Read next
- Section 9: application by an operational creditor
- Demand notice by an operational creditor: draft
- Reply to a CIRP notice: draft for the corporate debtor
- Section 5: operational creditor and operational debt
Disclaimer: Based on the IBBI consolidated text of the Insolvency and Bankruptcy Code, 2016 amended up to 12 August 2021 and on the Insolvency and Bankruptcy Code (Amendment) Act, 2026 (No. 6 of 2026), which comes into force on the date or dates notified by the Central Government, as consulted on 2 October 2026. It explains the words of the statute only; commencement notifications, other amendments made after 12 August 2021, notified thresholds, the rules and IBBI regulations, and the way tribunals and courts apply these sections should be checked. This article is general information, not legal advice; check the official text before acting.