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The Insolvency & Bankruptcy Code,

2016
Direct Questions
Question 1: (Study Material – New Course)
When will the provisions of insolvency and liquidation of corporate persons be applicable on
a corporate person?

Question 2: (Study Material – New Course)

Who may initiate corporate insolvency process against a corporate person?

Question 3: (Study Material – New Course, ICAI RTP November 2017, ICAI Mock March
2018- New Course, ICAI RTP – November 2018 – New Course)
What is the Insolvency Resolution Process for financial creditors?

Question 4: (Study Material – New Course)

What is the Insolvency Resolution Process for operational creditors?

Question 5: (Study Material – New Course)

What are the eligibility criteria for appointment of an Insolvency Professional as a
Resolution Professional for a corporate insolvency resolution process?

Question 6: (Study Material – New Course)

What is the procedure of Insolvency Resolution Process for a Corporate Applicant?

Question 7: (Study Material – New Course, ICAI Mock October 2018 – New Course)
Is there any time limit for completion of the Insolvency Resolution Process?

Question 8: (Study Material – New Course, ICAI Mock April 2018 – Old Course)
What is the effect of order of moratorium?

Question 9: (Study Material – New Course)

What is a Resolution plan?
Answer:
A resolution plan is a proposal agreed to by the Debtors and Creditors of an entity in a
collective mechanism to propose a time bound solution to resolve the situation of
insolvency. As per Section 30, the Insolvency Resolution Professional (IRP) within the
prescribed time i.e. 180 days or in case of extension 270 days, where Fast Track Resolution
within 90 days or in case of extension 135 days, is required to submit the Resolution Plan to
Adjudicating Authority (NCLT) prepared by the Resolution applicant on the basis of
information memorandum.
The Resolution Plan should provide for:
(i) payment of insolvency resolution costs;
(ii) repayment of the debts to operational creditors;
(iii) management of affairs of the Company after approval of the resolution plan;
(iv) implementation and supervision of the resolution plan;

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(v) does not contravene provisions of the law for the time being in force; and
(vi) conforms to such other requirement as may be specified by the Board.

Question 10: (Study Material – New Course)

When can a corporate person initiate voluntary liquidation process?

Case Study Based Question

Question 11: (ICAI Mock April 2018 – New Course, Extra Question given by ICAI)
Mr. Madhyam, was appointed as an Interim resolution professional during the Corporate
Insolvency Resolution Process. What are the duties to be performed by Mr. Madhyam in the
given capacity?
Answer: Refer Section 18

Question 12: (ICAI Mock April 2018 – New Course)

Mr. X, a Resolution professional in a liquidation process, on an examination of sale of
property of Corporate debtor finds that a transaction was made by the corporate debtor to
his relative within 6 months preceding the Insolvency Commencement date, was
undervalued.
Give the following Answer:s in reference to the above situation-
-State the validity of the conduct of such transaction by corporate debtor to his relative.
-What will be the consequences when resolution professional determines such transactions
undervalue and fails to report that same to NCLT?
-What order NCLT shall pass when Corporate Debtor entered into an undervalued
transaction?
Answer:
Validity of the conduct of undervalued transaction: As per the provisions given in section
45 of the Insolvency and Bankruptcy Code, 2016, Mr. X, a resolution professional, on an
examination of the transactions of the Corporate Debtor, determines that certain
transactions were made by Corporate Debtor with a related party, within the period of two
years preceding the insolvency commencement date (in 6 months preceding the Insolvency
Commencement date), which were undervalued. Mr. X, shall make an application to the
NCLT to declare such transactions as void and reverse the effect of such undervalued
transaction and requiring the person who benefits from such transaction to pay back any
gains he may have made as a result of such transaction.
Failure to report to NCLT of undervalued transactions: As per the stated facts given in the
light of the provisions laid in Section 47 of the Insolvency and Bankruptcy Code, an
undervalued transaction has taken place and Mr. X (Resolution Professional) has not
reported it to the NCLT, in such case, a creditor , member or a partner of a Corporate
Debtor, as the case may be, may make an application to the NCLT to declare such
transactions void and reverse their effect in accordance with the relevant provisions of this
Code.
Order of NCLT: Where the NCLT, after examination of the application made above, is
satisfied that undervalued transactions had occurred; and Mr. X (RP) after having sufficient
information or opportunity to avail information of such transactions did not report such
transaction, there it shall pass an order of —

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(a) restoring the position as it existed before such transactions and reversing the effects
thereof in the manner as laid down in section 45 and section 48 of the Code. The order of
the Adjudicating Authority may provide for the following:—
1. require any property transferred as part of the transaction, to be vested in the corporate
debtor;
2. release or discharge (in whole or in part) any security interest granted by the corporate
debtor
3. require any person to pay such sums, in respect of benefits received by such person, to
the Mr. X (RP), as the Adjudicating Authority may direct; or
4. require the payment of such consideration for the transaction as may be determined by
an independent expert.
(b) requiring the Board(IBBI) to initiate disciplinary proceedings against Mr. X.

Question 13: (ICAI Mock March 2018 – New Course, Extra Question given by ICAI)
X Ltd. was intending to initiate voluntarily liquidation proceedings. A declaration was made
on affidavit of the some of the directors of the X Ltd. verifying full inquiry of the affairs of
the company. They gave the opinion that the company will be able to pay its debts in full
from the proceeds of assets to be sold in the voluntary liquidation.
Analysing the given situation, comment whether X Ltd can initiate voluntary liquidation
proceeding in compliance with the conditions given in the Insolvency and Bankruptcy Code,
2016. What are the required documents to be accompanied with the declaration?
Also, state the consequences, where if the articles fixed the period of duration for which
company may be carried and that period expires.
Answer:
Section 59 of the Insolvency & Bankruptcy Code, 2016 empowers a corporate person
intending to liquidate itself voluntarily if it has not committed any default to initiate
voluntary liquidation proceedings under the provisions of this Code.
Any corporate person registered as a company shall meet the following conditions to initiate
a voluntary liquidation process:-
(a) A declaration from majority of the directors of the company verified by an affidavit
stating
i. That they have made a full inquiry into the affairs of the company and have formed an
opinion that either the company has no debts or that it will be able to pay its debts in full
from the proceeds of assets to be sold in the voluntary liquidation; and
ii. That the company is not being liquidated to defraud any person.
(b) The declaration shall be accompanied with the following documents, namely:
i. Audited financial statements and a record of business operations of the company for the
previous two years or for the period since its incorporation, whichever is later;
ii. A report of the valuation of the assets of the company, if any, prepared by a registered
valuer.

(c) After making the declaration the corporate debtor shall within four weeks -
i. Pass a special resolution at a general meeting stating that the company should be
liquidated voluntarily and insolvency professional to act as the liquidator may be appointed.
ii. Pass a resolution at a general meeting stating that the company be liquidated voluntarily
as a result of expiry of the period of its duration (fixed by its articles or on the occurrence of

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any event in respect of which the articles provide that the company shall be dissolved, if
any) and appointing an insolvency professional to act as the liquidator.

In the given situations, according to the above provisions, a declaration was made on
affidavit of the some of the directors of the X Ltd. verifying full inquiry of the affairs of the
company, is not in compliance as the majority was the requirement for initiation of the
voluntary liquidation proceedings. And the further declaration that the company is not
being liquidated to defraud any person is not given in the affidavit. The documents to be
accompanied with declaration shall be as per the point (b) given above.
Where if the articles fixed the period of duration of continuation and that period expires, X
Ltd. after making declaration, shall within 4 weeks pass a resolution at a general meeting
stating that the company be liquidated voluntarily as a result of expiry of the period of its
duration as fixed by its articles and appointing an insolvency professional to act as the
liquidator.

Question 14: ICAI Mock August 2018 – New Course & Old Course
Discuss the Principles on the basis of which the Insolvency Professional Agency (IPA) is
enrolled and regulate insolvency professionals as its members in accordance with the I & B
Code, 2016.
Answer:
Principles governing registration of Insolvency Professional Agency
ͻƚŽƉƌŽŵŽƚĞƚŚĞƉƌŽĨĞƐƐŝŽŶĂůĚĞǀĞůŽƉŵĞŶƚŽĨĂŶĚƌĞŐƵůĂƚŝŽŶŽĨŝŶƐŽůǀĞŶĐLJƉƌŽĨĞƐƐŝŽŶĂůƐ
ͻ ƚŽ ƉƌŽŵŽƚĞ ƚŚĞ ƐĞƌǀŝĐĞƐ ŽĨ ĐŽŵƉĞƚĞŶƚ ŝŶƐŽůǀĞŶĐLJ ƉƌŽĨĞƐƐŝŽŶĂůƐ ƚŽ ĐĂƚĞƌ ƚŽ ƚŚĞ ŶĞĞĚƐ ŽĨ
debtors, creditors and such other persons as may be specified
ͻƚŽƉƌŽŵŽƚĞŐŽŽĚƉƌŽĨĞƐƐŝŽŶĂůĂŶĚĞƚŚŝĐĂůĐŽŶĚƵĐƚĂŵŽŶŐƐƚŝŶƐŽůǀĞŶĐLJƉƌŽĨĞƐƐŝŽŶĂůƐ
ͻƚŽƉƌŽƚĞĐƚƚŚĞŝŶterests of debtors, creditors and such other persons as may be specified
ͻƚŽƉƌŽŵŽƚĞƚŚĞŐƌŽǁƚŚŽĨŝŶƐŽůǀĞŶĐLJƉƌŽĨĞƐƐŝŽŶĂůĂŐĞŶĐŝĞƐĨŽƌƚŚĞĞĨĨĞĐƚŝǀĞƌĞƐŽůƵƚŝŽŶŽĨ
insolvency and bankruptcy processes under this Code.

Question 15: ICAI Mock August 2018 – New Course & Old Course
Mr. Ramlal, an Insolvency professional was appointed as a resolution professional for a
corporate insolvency process initiated against the corporate debtor, Monotech Ltd. Mr.
Ramlal is a partner of consulting firm M/s supervision and company which is entity
recognized under the IBBI. It was discovered that M/s supervision and company had a
transaction with the Monotech Ltd. amounting to 11% of its gross turnover in the last
financial year 2017-2018.
Analyse the given situation as per the Insolvency and Bankruptcy Code, 2016, and advise on
the validity of appointment of Mr. Ramlal as resolution professional against Monotech Ltd.
Answer:
As per Regulation 3 of Insolvency and Bankruptcy (Insolvency Resolution Process for
Corporate Persons) Regulation, 2016, an insolvency professional shall be eligible for
appointment as a resolution professional for a corporate insolvency process if he and all
partners and directors of the insolvency professional entity of which he is partner or
director are independent of the corporate debtor. However such an Insolvency professional
who is appointed as an resolution professional shall not be an employee or proprietor or a
partner of a legal or consulting firm that has or had any transaction with the corporate

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debtor amounting to ten per cent or more of the gross turnover of such firm in the last
three financial years, subject to compliance of other requirements.
In the given instance, Mr. Ramlal, was appointed as Resolution professional for a corporate
insolvency process initiated against the Monotech Ltd. During the process, it was discovered
that Mr. Ramlal is a partner of a consultant firm M/s supervision and company, which has
made transaction of 11% of the gross turnover of the firm in the financial year 2017-2018
with Monotech Ltd.
Accordingly, Mr. Ramlal being a partner of the Firm had made a transaction of more than
10% of the gross turnover of the firm in the previous financial year 2017-2018. So his
appointment as resolution professional against Monotech Ltd for initiation of CIRP, is not
valid.
Replacement of Resolution Professional: As per the Code, if a debtor or a creditor is of the
opinion that the resolution professional appointed is required to be replaced, he may apply
to the Adjudicating Authority (AA) for replacement of such professional. Within seven days
of receipt of the application AA may make reference to the Board for Replacement of
Resolution Professional. As per Section 27 of the Code, the Committee of Creditors (CoC)
may replace the insolvency Resolution Professional with another resolution professional by
passing a resolution for the same to be approved by a vote of 66% per cent of voting shares
of the creditors. The Committee of Creditors shall forward the name of the new proposed
Insolvency Professional to the Adjudicating Authority, and after the confirmation of the
proposed insolvency resolution professional by the Board he shall be appointed in the same
manner as laid down in Section 16 which deals with the Appointment of IRP.

Question 16: (ICAI RTP – May 2018 – Old & New Course, ICAI Mock April 2018 – Old
Course)
Wisdom Ltd. commits a default against the debts taken from the financial creditors. Mr. F, a
financial creditor initiated the corporate insolvency resolution process against the Wisdom
Ltd. Mr. X, another financial creditor, thereof files an application for initiating corporate
insolvency resolution process with the Adjudicating Authority. Examine with reference to
the validity as to the filing of an application by Mr. X for initiation of corporate insolvency
resolution process?
Answer:
In the given problem, on commission of default by the Wisdom Ltd., Mr. F filed an
application for initiating corporate insolvency resolution process before adjudicating
authority. Further, Mr. X another financial creditor moved an application for initiation of
insolvency resolution process against the Wisdom Ltd.
According to the section 6 of the Code, where any corporate debtor commits a default, a
financial creditor, Operational creditor or the Corporate debtor itself may initiate insolvency
resolution process against such corporate debtor.
But as per Section 13 of the Code, once an application is admitted by the Adjudicating
authority, it shall by an order declare a moratorium for the purposes referred to in section
14. Then causes a public announcement of the initiation of CIRP by IRP and call for the
submission of claims under section 15 and appoint an IRP in the manner as laid down in
section 16 of the Code. Public announcement lays down all the relevant information related
to the CIRP. So that the all creditors entitled under the law can raise their claim in this case.
So, no further application for initiation of CIRP can be initiated by Mr. X., however he is
entitled under the law to raise his claim in this case against the Wisdom Ltd.

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Question 17: (ICAI Exam November 2017, ICAI RTP – May 2018 – Old & New Course)
Standard International Ltd. who is a foreign trade creditor having its office in Hong Kong
wanted to file a petition under insolvency and bankruptcy code 2016 on default of the
debtor in India. It moved a petition under section 9 of the code seeking commencement of
insolvency process. The foreign company was not having any office or bank account in India.
Because of this, it couldn’t submit a “certificate from financial institution “as required under
the code. Examine whether the petition is permissible under the Insolvency & Bankruptcy
Code, 2016?
Answer:
As per the facts given in question, Standard International Ltd., is a foreign trade creditor. He
wanted to file a petition under the under Section 9 of the Insolvency and Bankruptcy Code,
2016 for commencement of Insolvency process against the defaulter in India. Standard
International Ltd. was not having any office or bank account in India.
As per the requirement of section 9 of the Code, along with application certain documents
were needed to be furnished by the creditor to the Adjudicating authority. Being a foreign
trade creditor, Standard International Ltd was also required to provide a copy of certificate
from the financial institutions maintaining accounts of the creditor confirming that there is
no payment of an unpaid operational debt by the corporate debtor. Since, Standard
International Ltd. was not having any office or bank account in India, it cannot furnish
certificate from financial institution as defined under the section 3(14) of the code.
However as per the amendment, the words – Copy of Certificate from Financial Institution,
if available were added in the section; thus making it non-mandatory.
So, Petition under section 9 of the Code is permissible.

Question 18: (ICAI Exam May 2018 – New Course)

You are appointed as Interim Resolution Professional in XYZ Company Ltd. under the
Insolvency and Bankruptcy Code, 2016. State the time limit to make Public Announcement?
Also state the protocol for issuance of public notice. Who shall bear the expenses of public
announcement?
Answer:
(1) Time Limit for making Public Announcement
Interim Resolution Professional shall make the Public Announcement immediately after his
appointment. “Immediately” here means not more than three days from the date of
appointment of the Interim Resolution Professional. Hence, the time limit to make Public
Announcement is within 3 days from the date of appointment of the Interim Resolution
Professional.
(2) Protocol for issuance of Public Notice
As per Section 15 of the Insolvency and Bankruptcy Code,2016, public announcement shall
include the following:-
(a) Name & Address of Corporate Debtor under the Corporate Insolvency Resolution
Process.
(b) Name of the authority with which the corporate debtor is incorporated or registered.
(c) Details of interim resolution Professional who shall be vested with the management of
the Corporate Debtor and be responsible for receiving claims.
(d) Penalties for false or misleading Claims.
(e) The last date for the submission of the claims.
(f) The date on which the Corporate Insolvency Resolution Process ends.

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(3) Expenses of Public Announcement

The expenses of public announcement shall be borne by the applicant which may be
reimbursed by the Committee of Creditors, to the extent it ratifies them.

Question 19: (ICAI Exam May 2018 – New Course)

Rose Garden Ltd. was incurring continuous losses and its financial position went bad to
worse. Black Stone (Private) Ltd., a trade creditor, issued notice under Section 271 of the
Companies Act, 2013 for winding up of Rose Garden Ltd. on the ground that Rose Garden
Ltd. was unable to pay its debts. After some time, Black Stone (Private) Ltd. being an
operational creditor filed a petition before the Adjudicating Authority to initiate insolvency
process under the Insolvency and Bankruptcy Code, 2016. Demand Notice and copy of
invoice were not served to Rose Garden. Ltd. since a notice was earlier issued for winding
up. All other formalities were complied with. The Adjudicating Authority initiated Insolvency
Resolution Process by admitting the application and appointed Resolution Professional.
After complying required formalities, the Adjudicating Authority issued orders for
moratorium and other relief within the stipulated time. Being aggrieved by the order of
Adjudicating Authority, Rose Garden Ltd. (Corporate debtor) filed an appeal before NCLAT
under the Insolvency and Bankruptcy Code, 2016. Determine will the Company succeed in
its appeal?
Answer:
As per Section 8 of the Insolvency and Bankruptcy Code, 2016, once a default has occurred,
the operational creditor has to deliver a demand notice or a copy of invoice demanding
payment of debt in default to the corporate debtor.
Since in the given case, demand notice and copy of invoice was not served to the Rose
Garden Ltd., so the requirement for the initiation of the corporate insolvency resolution
process by operational creditor under section 9 of the Code, was not in compliance. So, the
admission of application in line with the compliance of other required formality as to issue
of order of moratorium and other relief, given by the NCLT was against the law.
As Rose Garden Ltd. (Corporate debtor) was aggrieved by the Order of the Adjudicating
Authority on the non-compliance of requirement of Section 8, Rose Garden Ltd. will succeed
in its appeal filed before the National Company Law Appellate Tribunal.

Question 20: (ICAI Mock August 2017)

What is the procedure for replacement of insolvency resolution professional? What are the
key tasks to be performed by a Resolution Professional?
Answer:
As per Section 27 of the Insolvency & Bankruptcy Code, the Committee of Creditors may at a
meeting, by a vote of 66% of voting shares propose to replace the insolvency resolution
professional with another resolution professional.
The Committee of Creditors shall forward the name of the insolvency professional proposed
by them to the Adjudicating Authority and after the confirmation of the proposed
insolvency resolution professional by the Board he shall be appointed in the same manner
as laid down in Section 16.
Where any disciplinary proceedings are pending against the proposed resolution
professional then the resolution professional appointed under section 22 shall continue till
the appointment of another resolution professional under this section.

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Key tasks to be performed by a Resolution Professional:

The following are the key tasks to be performed by a resolution professional:-
(a) Obtaining Valuation of the entity
(b) Preparation of Information Memorandum
(c) Preparation of Resolution plan
(d) Obtaining consent of the Committee of Creditors for the Resolution plan
(e) Periodic reporting to the Board

Question 21: (ICAI Mock August 2017, ICAI RTP November 2017, ICAI Mock April 2018 –
Old Course)
State the circumstances when persons are not entitled to make an application to initiate
corporate insolvency resolution process.
Suppose a corporate debtor has committed a default and is undergoing a corporate
insolvency resolution process. A corporate applicant Mr. X thereof files an application for
initiating corporate insolvency resolution process with the Adjudicating Authority, State
whether he is entitled to make an application to initiate corporate insolvency resolution
process?
Answer:
The following persons shall not be entitled to make an application to initiate corporate
insolvency resolution process -
(a) a corporate debtor undergoing a corporate insolvency resolution process; or
(b) a corporate debtor having completed corporate insolvency resolution process twelve
months preceding the date of making of the application; or
(c) a corporate debtor or a financial creditor who has violated any of the terms of resolution
plan which was approved twelve months before the date of making of an application under
this Chapter; or
(d) a corporate debtor in respect of whom a liquidation order has been made.

In this section, a corporate debtor includes a corporate applicant in respect of such

corporate debtor. [Section 11 of the Insolvency and Bankruptcy Code, 2016]
As per the facts corporate applicant Mr. X seems to be a independent individual and not a
corporate applicant in relation to such corporate debtor who is undergoing a corporate
insolvency resolution process. So, he shall be entitled to make an application to initiate
corporate insolvency resolution process.

Question 22: (ICAI Mock October 2017)

Mr. X, a Financial creditor filed an application against corporate debtor (defaulter) for the
initiation of insolvency process before the NCLT on 1st of July, 2017. NCLT admitted the
application on satisfaction that default has occurred and the application is complete from all
the compliances, through an order passed on 10th of July, 2017. As per the Insolvency and
Bankruptcy Code, 2016, state the initiation date for the corporate insolvency resolution
process and the insolvency commencement date. Also calculate time period for the
completion of the Insolvency Resolution Process by the NCLT.
Answer:
As per the Section 5 (11) of the Insolvency & Bankruptcy Code, 2016, Initiation date is the
date on which a financial creditor, corporate applicant or operational creditor, as the case
may be, makes an application to the Adjudicating Authority for initiating corporate

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insolvency resolution process. So accordingly, in the given case is an 1st of July 2017
initiation date for commencing of corporate insolvency resolution process.
Further section 5(12) states that Insolvency commencement date is the date of admission
of an application for initiating corporate insolvency resolution process by the Adjudicating
Authority under sections 7, 9 or section 10, as the case may be. In case of a financial
creditor, the NCLT shall, within fourteen days of the receipt of the application, ascertain the
existence of a default from the records of an information utility or on the basis of other
evidence furnished by the financial creditor.
As per the stated facts default has been determined within the given time period of 14 days
from receipt of application.
Accordingly, 10th of July is the date on which the application for initiation of corporate
insolvency process is admitted by the NCLT, so it is the insolvency commencement date.
Time for completion of Insolvency Resolution Process (IRP): Section 12 of the Code states
that any Insolvency Resolution Process shall be completed within a period of one hundred
and eighty days (i.e., 6 months) from the date of admission of the application to initiate the
process. So accordingly, corporate insolvency process should be completed by 10th of
January, 2018. However, the NCLT may on an application made by the resolution
professional, under a resolution passed by the Committee of Creditors, by a vote of 66% of
voting shares, after consideration provide one extension which shall not extend more than
90 days.

Question 23: (ICAI Mock October 2017, ICAI Mock October 2018 – Old Course)
A resolution applicant submits a resolution plan to the resolution professional. After
examination of resolution plan, the resolution professional without convening a meeting of
the committee of creditors, submitted the resolution plan to the Adjudicating Authority.
State the validity of the act of the resolution professional under the Insolvency and
Bankruptcy Code, 2016.
Answer:
According to the Insolvency & Bankruptcy Code, 2016, the resolution professional shall
convene a meeting of the committee of creditors and seek the vote of the creditors prior to
taking any of the actions.
No action shall be approved by the committee of creditors unless approved by a vote of
seventy five per cent of the voting shares. Where any action is taken by the resolution
professional without seeking the approval of the committee of creditors in the manner as
required in this section, such action shall be void.
The resolution professional shall submit the resolution plan as approved by the committee
of creditors to the Adjudicating Authority.
Since in the given case, resolution professional without convening a meeting of the
committee of creditors, submitted the resolution plan to the Adjudicating Authority, so the
act of the resolution professional is not in compliance with the Code, so his act is not valid.

Question 24: (ICAI Mock October 2017, ICAI Mock October 2018 – Old Course)
When will the provisions of insolvency and liquidation of corporate persons be applicable on
a corporate person?
Answer:
As per the provision given in Section 4 of the Insolvency & Bankruptcy Code, 2016 the
matter related to the insolvency and liquidation of corporate debtors shall be applicable

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only when the amount of the default is one lakh rupees or more. However, the Central
Government may, by notification, specify the minimum amount of default of higher value
which shall not be more than one crore rupees.

Question 25: (ICAI Mock March 2018 – Old Course)

Samridhi Pvt. Ltd. is declared as defaulter against Shubham cooperative Bank Ltd. for
financial debt of Rs. 10 cr. against the business transactions. State in the given situation
whether the Shubham cooperative Bank can initiate the insolvency resolution process
against Samridhi Pvt. Ltd. under the provisions of the Insolvency & Bankruptcy Code.
Answer:
According to the Banking Regulation (Amendment) Act, 2017 vide Notification dated 25th
August, 2017 w.e.f. 4th May 2017, Section 35AA have been inserted. This section deals with
the Power of Central Government to authorise Reserve Bank for issuing directions to
banking companies to initiate insolvency resolution process. According to the section, the
Central Government may, by order, authorise the Reserve Bank to issue directions to any
banking company or banking companies to initiate insolvency resolution process in respect
of a default, under the provisions of the Insolvency and Bankruptcy Code, 2016.
The “default” has the same meaning assigned to it in clause (12) of section 3 of the
Insolvency and Bankruptcy Code, 2016.
Accordingly, Shubham cooperative Bank can initiate the insolvency resolution process
against Samridhi Pvt. Ltd. under the section 7 of the Insolvency & Bankruptcy Code, 2016,
only when Reserve bank (authorized by Central Government) issues directions to Shubham
cooperative Bank to any banking company to initiate insolvency resolution process in
respect of a default, under the provisions of the Insolvency and Bankruptcy Code, 2016.

Question 26: (ICAI Mock March 2018 – Old Course)

Mr. Naman was a resolution professional for the Corporate Insolvency Resolution process
initiated against the corporate debtor, PQR Pvt. Ltd. However, attempt to resolve the
insolvency of PQR Pvt. Ltd. failed. An order for liquidation of PQR Pvt. Ltd., was passed by
the NCLT. Mr. Naman acted as liquidator. The resolution plan submitted by Mr. Naman was
rejected for failure to meet the requirements. Board recommended for the replacement of
Mr. Naman.
What steps may be taken for the appointment of another liquidator under the Insolvency
and Bankruptcy Code. What are the other aspects related to the charge of fees for the
conduct of liquidation proceeding.
Answer:
According to section 34 of the Insolvency and Bankruptcy Code, 2016, where the
Adjudicating Authority passes an order for liquidation of the corporate debtor, the
resolution professional appointed for the corporate insolvency resolution process, shall act
as the liquidator for the purposes of liquidation unless replaced by the Adjudicating
Authority.
The Adjudicating Authority shall by order replace the resolution professional, if—
(a) the resolution plan submitted by the resolution professional was rejected for failure to
meet the requirements; or
(b) the Board recommends the replacement of a resolution professional to the
Adjudicating Authority for reasons to be recorded in writing.

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On rejection of resolution plan due to failure to meet the requirements, the Adjudicating
Authority may direct the Board to propose the name of another insolvency professional to
be appointed as a liquidator.
The Board shall propose the name of another insolvency professional within ten days of the
direction issued by the Adjudicating Authority.
The Adjudicating Authority shall, on receipt of the proposal of the Board for the
appointment of an insolvency professional as liquidator, by an order appoint such
insolvency professional as the liquidator.
Charge of fees for conduct of liquidation proceedings: An insolvency professional proposed
to be appointed as a liquidator shall charge such fee for the conduct of the liquidation
proceedings and in such proportion to the value of the liquidation estate assets, as may be
specified by the Board.
Payment of fees: The fees for the conduct of the liquidation proceedings shall be paid to the
liquidator from the proceeds of the liquidation estate.

Question 27: (ICAI Mock March 2018 – Old Course)

What order shall be passed by the NCLT if Resolution plan submitted by Resolution
professional to the NCLT after the expiry of the insolvency resolution process.
Answer:
As per section 33 of the Insolvency and Bankruptcy Code, 2016 where the adjudicating
Authority does not receive a resolution plan within 180 days of the insolvency resolution
process period, following shall be the consequences:
(i) Adjudicating authority shall pass an order requiring the corporate debtor to be liquidated
in the manner as laid down in Chapter III of Part II of the Code.
(ii) issue a public announcement stating that the corporate debtor is in liquidation; and
(iii) require such order to be sent to the authority with which the corporate debtor is
registered.
Where the resolution plan approved by the Adjudicating Authority is contravened by the
concerned corporate debtor, any person other than the corporate debtor, whose interests
are prejudicially affected by such contravention, may make an application to the
Adjudicating Authority for a liquidation order.
On receipt of an application, if the Adjudicating Authority determines that the corporate
debtor has contravened the provisions of the resolution plan, it shall pass a liquidation
order.

Question 28: (ICAI Mock August 2018 – Old Course, ICAI RTP November 2018 – Old Course,
ICAI Mock October 2018 – New Course)
The following particulars relate to Big Rammy (Private) Ltd. which has gone into Corporate
Insolvency Resolution Plan (CIRP):
Sr. No. Particulars Amount in Rs.
1 Amount realized from the sale of liquidation of assets 14,00,000
2 Secured creditor who has relinquished the security 5,00,000
3 Unsecured financial creditors 4,00,000
4 Income-tax payable within a period of 2 years
preceding the liquidation commencement date 50,000
5 Cess payable to state government within a period
of one year preceding the liquidation commencement date 20,000

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6 Fees payable to resolution professional 75,000

7 Expenses incurred by the resolution professional
in running the business of the Big Rammy (Private) Ltd.
on going concern 25,000
8 Workmen salary payable for a period of thirty months
preceding the liquidation commencement date. The
workmen salary is equal per month 3,00,000
9 Equity shareholders 10,00,000

State the priority order in which the liquidator shall distribute the proceeds under the
Insolvency and Bankruptcy Code 2016.
Answer:
As per section 53 of Insolvency and Bankruptcy Code, 2016, the proceeds from the sale of
liquidation assets shall be distributed in the following order of priority:
Insolvency Resolution Process Cost and Liquidation cost to be paid in full

Question 29: (ICAI Exam November 2017):

Nature India Limited filed a petition under the Insolvency and Bankruptcy Code, 2016 with
National Company Law Tribunal (NCLT) against Tulip Limited and the petition was admitted.
After that, Nature India Limited wanted to withdraw the petition based on a settlement
arrived between the parties. Whether it is permissible to withdraw the petition after it has
been admitted? Decide. Also explain the rules relating to the admission and rejection of
application by an adjudicating authority under the Insolvency and Bankruptcy Code, 2016.
Answer:
As per the facts given in the question, Nature India Limited filed a petition under the
Insolvency and Bankruptcy Code, 2016 with NCLT against the Tulip Limited and the petition
was admitted. After that Nature India Limited wanted to withdraw the same due to
settlement between the parties. As per Rule 8 of the Insolvency and Bankruptcy (Application
to Adjudicating Authority) Rules, 2016, the Adjudicating Authority may permit withdrawal of

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the application made under rules 4 (Application by financial creditor), 6 (Application by

operational creditor) or 7 (Application by corporate applicant), as the case may be, on a
request made by the applicant before its admission.
Since in the given instance, Nature India Limited wanted to withdraw the petition after it
was admitted by the adjudication authority. So it is now permissible to withdraw the
petition after been admitted u/s 12A

Provisions related to admission or rejection of application by an adjudicating authority in

the Insolvency and Bankruptcy Code, 2016- The Adjudicating Authority shall, on the receipt
of the application within the given time period under the relevant provisions, ascertain the
existence of a default and pass the order [under Section 9(5) of the IBC, 2016]. Where the
Adjudicating Authority is satisfied, either—

Further, the Adjudicating Authority shall communicate order of admission or rejection of

such application within given time, as the case may be.

Question 30: (ICAI Exam May 2018 – Old Course)

M/s Systemtek India Private Limited (Appellant-Corporate Debtor) has challenged the order
dated 3rd July, 2017 passed by the Adjudicating Authority (National Company Law Tribunal)
Mumbai Bench, Mumbai, in the National Company Law Appellate Tribunal (NCLAT).
NCLT had admitted the application preferred by appellant under Section 10 of the
Insolvency and Bankruptcy Code, 2016 and an order of Moratorium was passed and
Insolvency Resolution Professional was ordered to be appointed by the Ld. Adjudicating
Authority (NCLT).
The only grievance of the appellant in its challenge is that the movable and immovable
property of Guarantor (promoter) has been attached pursuant to a Corporate Insolvency
Resolution Process initiated under section 10 against the Appellant by the Ld. Adjudicating
Authority (NCLT) which is violative of section 14(1)(c) of the Insolvency and Bankruptcy
Code, 2016 though the Code prescribes a Moratorium for certain types of transactions.
Decide.
Answer:
As per the given facts in the question, Appellant, M/S Systemtek India Private Limited,
challenged the order passed by the NCLT on the ground stating that the movable and
immovable property of guarantor (Promoter) has been attached pursuant to a Corporate
Insolvency Resolution Process initiated under Section 10 of the Code against the Appellant.

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As per Section 14(1) of the Insolvency and Bankruptcy Code, 2016, on the Insolvency
commencement date, the NCLT shall by order declare moratorium prohibiting certain acts
by /against the Corporate Debtor. According to clause ( c) of the said provision, the order
prohibits any action to foreclose, recover or enforce any security interest created by the
corporate debtor in respect of its property including any action under the Securitisation and
Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002.
The order of moratorium shall have effect from the date of such order till the completion of
the corporate insolvency resolution process.
The word ‘its’ used in clause (c) of sub-Section (1) of Section 14 of IBC, 2016, refers to
corporate debtor and not the guarantors.
In view of this, the Order of NCLT under Section 14(1)(c) of IBC 2016 is not violative.
However M/s Systemtek India Private Limited can challenge the Order of the NCLT on the
ground that until the liability of the Company is decisively crystallize, the guarantor cannot
be held liable.

Question 31: (ICAI Exam May 2018 – Old Course)

BDLK Limited decided to go for voluntary winding up and accordingly the Board of Directors
at a meeting of the Board are about to take the necessary steps to initiate the winding up
proceedings. The Board of Directors of the company approached you for guidance in this
regard. Please list out the steps required under the Insolvency & Bankruptcy Code 2016
before approval of such liquidation proposal with specific reference to meetings and actions
of relevant stakeholders.
Answer: Full Section 59

Question 32: (ICAI Exam May 2018 – Old Course)

M/s TAS Constructions Private Limited, an operational creditor on 2nd April, 2018 being the
default date issued a demand notice through speed post to M/s Dheeraj Constructions
Private Limited, an unpaid operational/corporate debtor demanding payment of its invoice
dated 19th March, 2018 for Rs.5,60,000 (15 days payment terms) towards supply of certain
works contract services as per the provisions of section 8(1) of the Insolvency and
Bankruptcy Code, 2016 and rules framed there under/s
Dheeraj Constructions Private Limited on receipt of the demand notice informed the
operational creditor, that vide their e-mail dated 30th March, 2018, addressed to the
company and all its directors, they have disputed the invoice on the quality of the services
rendered and were withholding payment till the dispute is settled but without initiating any
legal proceedings under any law for the time being in force. The operational creditor on
expiry of the period of 10 days from the date of delivery of the demand notice and non-
payment of its dues approached the Adjudicating Authority for the initiation of the
corporate insolvency resolution process under section 9(1) of the Insolvency and Bankruptcy
Code, 2016. Will the application of the operational creditor filed under section 9 (1) read
with section 8(2) (a) of the Insolvency and Bankruptcy Code, 2016 be permitted?
Answer:
The given problem is based on Section 9(1) of the Insolvency and Bankruptcy Code, 2016.
According to the provision, after the expiry of the period of ten days from the date of
delivery of the notice or invoice demanding payment, if the operational creditor does not
receive payment from the corporate debtor or notice of the dispute, the operational

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creditor may file an application before the Adjudicating Authority for initiating corporate
insolvency resolution process.
However, as per Section 8(2)(a) of the Code, the corporate debtor shall, within a period of
ten days of the receipt of the demand notice or copy of the invoice bring to the notice of the
operational creditor about existence of dispute, if any, and record of the pendency of the
suit or arbitration proceedings filed before the receipt of such notice or invoice in relation to
such dispute.
Facts given states that the Dheeraj Constructions Private Limited on receipt of the demand
notice, informed M/s TAS Constructions Private Limited (Operational Creditor) that through
email dated 30th March, 2018, addressed the company and all its directors, of the dispute
on the invoice and withholding of the payment till the settlement of the dispute.
The provision of Section 8(2)(a) envisages existence of dispute, if any and record of the
pendency of the suit or arbitration proceedings filed by the Corporate Debtor before receipt
of such notice or invoice in relation to such disputes: thus existence of disputes and record
of pendency of the suit or arbitration proceedings both are to be filed. Whereas, Section 5
(6) defines ‘disputes” as disputes includes a suit or an arbitration proceedings relating to:
(a) The existence of the amount of the debt
(b) The quality of goods or service or
(c) The breach of the representation or the warranties.
The Supreme Court has settled the position in the case of Innoventive Industries Vs ICICI
Bank.
Hence, the requirement of Section 8, to bring to the notice of the operational creditor about
an existence of dispute only and not along with the record of the pendency of the suit or
arbitration proceedings as settled by the Supreme Court in the cases referred above filed
before the receipt of such notice or invoice in relation to such dispute have been complied
with and record of the pendency of the suit or arbitration proceedings filed before the
receipt of such notice or invoice in relation to such dispute, have been complied with.
So, the application of M/s TAS Constructions Private Limited (Operational Creditor) shall not
be permitted under Section 9 of the Insolvency and Bankruptcy Code, 2016 as Dheeraj
Construction Private Limited has complied the provisions of Section 8(2)(a) of the IBC, 2016.

Question 33 (ICAI Exam November 2018 – New Syllabus)

As on March 31, 2018, the audited balance sheet of M/s Sharp Industries Limited, revealed
total assets of Rs. 1 Crore. M/s Sharp Industries Limited, in the capacity of a Corporate
Debtor, filed an application on July 1, 2018 with the Adjudicating Authority for initiating a
fast track corporate insolvency resolution process. Explain under the provisions of
Insolvency and Bankruptcy Code, 2016 the following:
(i) Whether the application made by M/s Sharp Industries Ltd. For initiating a fast track
corporate insolvency resolution process is, admissible ?
(ii) The time period including the extension of time period, if any, within which the fast track
corporate insolvency resolution process shall be completed ?
Answer: Refer Section 55 & 56

Question 34: (ICAI Exam November 2018 – New Syllabus)

XY Ltd. filed a petition under Insolvency and Bankruptcy code, 2016 with NCLT against
DF.Ltd. (corporate Debtor) and the petition was admitted. There were only three financial
creditors including XY Ltd. During the corporate Insolvency Resolution process, the

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corporate Debtor settled the claims of all the 3 financial creditors. Whether such settlement
agreement could be termed as a valid resolution plan? Also discuss whether a financial
creditor in respect of whom there is no default can file an application before Adjudicating
Authority (NCLT) for initiating corporate insolvency resolution process. Discuss.
Answer: Refer Section 12A & Section 4

Question 35: (ICAI Exam November 2018 – Old Syllabus)

Best Bank, a financial creditor sent a demand notice for a claim of Rs 10.2 crores on XYZ
Limited, a corporate debtor on 6th February, 2018. When the petition was filed before NCLT
under Insolvency and Bankruptcy Code, 2016, Best Bank claimed that the XYZ Ltd has
defaulted Rs. 29.8 crores instead of original amount of Rs. 10.2 crores. NCLT appointed an
interim insolvency resolution professional. XYZ Ltd made an appeal with NCLAT demanding
that the Best Bank's claim is not maintainable as there is a difference in the amount
mentioned in the demand notice and the application filed under the Code. Decide whether
the contention of XYX Limited is correct. Also, State who can file Corporate Insolvency
Resolution process under the Code.
Answer: Refer Section 7

Question 36: (ICAI Exam November 2018 – Old Syllabus)

Mr. SP booked office space with Elegant Construction Limited. At the time of booking Rs. 36
lakhs was paid. Remaining amount of Rs. 10 lakhs was paid at the time of taking delivery. He
entered into a Memorandum of understanding (MoU) with the company having various
terms and conditions of the sale/allotment. According to the MoU, Elegant Construction
Limited was required to build and deliver the possession of the unit within 2 years from the
date of execution of the MoU. It also stipulated payment of an assured return of Rs. 82,000
per month (subject to TDS u/s 194A of IT Act, 1961) till possession of the unit was delivered
to Mr. SP. Elegant construction Limited failed to pay the assured return. Thereafter, Mr. SP
filed an application for initiating insolvency resolution process. Decide about the validity of
the said application in view of the provisions of Insolvency and Bankruptcy code, 2016 as
regards the definition of a “Financial Creditor" under section 5 (7) read with section 5 (8) of
the code.
Answer: Hint: Refer Definition of Financial Creditor & Case Law – Nikhil Mehta & Sons (HUF)
v. M/s AMR Infrastructures Ltd.

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26.Arbitratorcanresignwhentheywant,
(a)Aftergivingreasonsfordoingso Š‡•‘Ž˜‡…›Ƭƒ”—’–…›
(b)Withoutgivingreasonsforresigning
(c)Cannotresigntillthecasegetsclosed ‘†‡ǡʹͲͳ͸ 
(d)Noneoftheabove

27. Request for Settlement Award must be made within ____ days of MCQscoverscertaingeneralinformationalsowhichneedstobeconsidered
receiptoffinalaward: fromthissectiondirectlyforexaminationpurpose.
(a)45  (b)30  (c)90  (d)120 
 1.IBC,2016wasintroducedinLokSabhaon:
28.NationalityofArbitratorisusuallyrelevantin: (a)28thMay,2016  (b)21stDecember,2015
th
(a)DomesticArbitration (c)15 May,2016 (d)Noneoftheabove
(b)InternationalArbitration 
(c)(a)or(b) 2.ForIBC,2016President’sassentwasreceivedon:
(d)(a)&(b) (a)28thMay,2016  (b)21stDecember,2015
 (c)15thMay,2016 (d)Noneoftheabove
29.ArbitrationandConciliationAct,1996cameintoenforcementon: 
(a)1stJanuary1996  (b)1stApril1996 3.Insolvencyincaseofindividualsisknownas:
(c)22ndAugust1996  (d)22ndApril1996 (a)Liquidation  (b)Bankruptcy
 (c)CorporateInsolvency(d)Both(a)&(b)
 
 4.Insolvencyincaseoforganizationsisknownas:
MCQsAnswersofArbitration&ConciliationAct,1996 (a)Liquidation(b)Bankruptcy
1.(c) 6.(c) 11.(a) 16.(a) 21.(d) 26.(b) (c)CorporateInsolvency(d)Both(b)&(c)
2.(b) 7.(c) 12.(c) 17.(a) 22.(d) 27.(b) 
3.(d) 8.(b) 13.(c) 18.(c) 23.(a) 28.(b) 5.IncaseofnonͲcorporates,ifinsolvencyisuntreateditleadsto:
4.(c) 9.(a) 14.(d) 19.(c) 24.(c) 29.(c) (a)Liquidation(b)Bankruptcy
5.(d) 10.(c) 15.(a) 20.(b) 25.(a)  (c)CorporateInsolvency(d)Both(a)&(b)
 
6.Incaseofcorporates,ifinsolvencyisuntreateditleadsto:
  (a)Liquidation(b)Bankruptcy
(c)CorporateInsolvency(d)Both(a)&(b)


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7.  ________ is a legal proceeding involving a person or business that is 15.CompositionofInsolvency&BankruptcyBoardofIndiaincludes:
unabletorepayoutstandingdebts. (a)2membersfromofficeofCG (b)2membersnominatedbyRBI
(a)Liquidation    (b)Insolvency (c)3Chairmen  (d)Atleast3wholetimemembersnominatedbyCG
(c)Bankruptcy    (d)Noneoftheabove 
 16.QuasiJudicialfunctionofInsolvencyprofessionalagenciesincludes:
8.Ifanypersonisunabletopaydebtsthensuchperson/entityistreatedas: (a)AddressingGrievances
(a)Liquidated    (b)Insolvent (b)MonitoringInsolvencyprofessionals
(c)Bankrupt    (d)Noneoftheabove (c)DraftingByeͲlawsforInsolvencyprofessionals
 (d)Alloftheabove
9.___________iswindingupofacompany 
(a)Liquidation    (b)Insolvency 17. Information Utilities means a centralized electronic database about
(c)Bankruptcy    (d)Noneoftheabove informationon:
 (a)FinancialInstitutions  (b)InsolvencyProfessionals
10.PurposebehindenactmentofIBC,2016is: (c)Creditors    (d)CorporateDebtors
(a)Balanceinterestofallstakeholders   
(b)Promoteentrepreneurship 18.PartIIIofIBC,2016appliesto:
(c)Increaseavailabilityofcredit (d)Alloftheabove (a)WholeofIndia  
 (b)WholeofIndiaexcludingJammu&Kashmir
11.1stlevelofAdjudicatingAuthorityforLLPis: (c)Jammu&Kashmir   (d)Noneoftheabove

(a)NCLT (b)DRT (c)DRAT (d)SupremeCourt
19.IBC,2016isapplicableto:

(a)Individuals     (b)LLPs
12.Insolvency&BankruptcyBoardofIndiawasestablishedon:
(c)Personalguarantorstocorporatedebtors (d)Alloftheabove
(a)1stOctober,2016   (b)15thOctober,2016 
th
(c)30 September,2016  (d)Noneoftheabove 20. Provisions relating to Corporate Insolvency Resolution Process are
 coveredin_____ofthecode.
13.HeadofficeofInsolvency&BankruptcyBoardofIndiaisat: (a)PartI   (b)PartII
(a)Kolkata (b)NewDelhi  (c)Mumbai (d)Chennai (c)PartIII   (d)Noneoftheabove


21.IBC,2016shallapplytomattersrelatingtoinsolvency&liquidationof
14.Insolvency&BankruptcyBoardofIndiaisa:
corporatedebtorswhere:
(a)LLP    (b)BodyCorporate
(a)MinimumamountofdefaultisRs.5lakhs
(c)Association   (d)HUF
(b)MinimumamountofdefaultisRs.1lakhs

(c)MinimumamountofdefaultisRs.5lakhs
 
(d)Noneoftheabove

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22.LimitofamountofdefaultunderIBC,2016canbeincreasedupto:: 28. Who are not entitled to make application to initiate CRP under IBC,
(a) Rs.5Crore  (b) Rs.1Crore  (c) Rs.10Crore 2016?
(d)Noneoftheabove (a)CorporatedebtorundergoingCIRP
 (b) Corporate debtor having completed CIRP 12months preceding date of
23.FinancialcreditormayfileanapplicationtoAdjudicatingAuthority: makingapplication
(a)Eitherbyitself  (b)Jointlywithotherfinancialcreditor (c)Corporatedebtor/financialcreditorwhohasviolatedtermsofresolution
(c)(a)or(b)   (d)Noneoftheabove planwhichwasapproved12monthsbeforedateofmakingapplication
 (d)Alloftheabove
24.AdjudicatingAuthorityshallascertaindefaultdonebycorporatedebtor 
within_____daysofreceiptofapplication. 29. CIRP must be completed within ____ days from date of admission of
(a)7  (b)15  (c)14  (d)Noneoftheabove applicationtoinitiatesuchprocess.
 (a)30  (b)45  (c)90  (d)180
25.Corporatedebtorshallbringtothenoticefoperationalcreditor: 
(a)Existenceofdispute  (b)Recordofpendencyofsuitfiledearlier 30.CIRPshallbeextendedifresolutionispassedatcommitteeofcreditors
(c)Paymentofunpaidoperationaldebt (d)Alloftheabove meetingbyavoteof___%ofvotingshares.
 (a) 25  (b)60  (c)33  (d)66
26.OperationalCreditor,whilesubmittingthefollowingdocumentstoAA, 
i.e. copy of record with information utility confirming that no payment is 31.OnsatisfactionofAA,maximumextensionthatcanbegrantedtoCIRP
donebycorporatedebtor,is: isof___days.
(a)Mandatory    (b)Optional   (a)180 (b)45  (c)90  (d)60
(c)Tobesubmittedifavailable  (d)Noneoftheabove 
 32.HowmanytimescanextensionbegrantedincaseofCIRP?
27.CIRPbycorporateapplicantshallincludenecessarydocumentssuchas: (a)2times (b)1time (c)DependsontheIBBIorAA
(a)InformationrelatingtoBOA&otherdocuments (d)Nolimit
(b)InformationrelatingtoRP,proposedtobeappointedasIRP 
(c) SR passed by SHS of corporate debtors or resolution passed by 3/4th of 33. Adjudicating authority may allow to withdraw the applications on an
totalnumberofpartnersofcorporatedebtor applicationmadebyapplicantwithapprovalof___%ofvotingshareofCOC
(d)Alloftheabove aspersection12A.
 (a)51  (b)66  (c)25  (d)90
  
34.Publicannouncementshallbemadeimmediatelyafterappointmentof
IRP,maximumwithin___days
(a)7  (b)3  (c)15  (d)10

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35.Inmoratorium,acalmperiodof__daysisdeclared. 41.Alldecisionsofcommitteeofcreditorsshallbetakenbyavoteof___%
(a)90  (b)145  (c)180  (d)Noneoftheabove ofvotingshare.
 (a)>50% (b)>60% (c)ш51% (d)Noneoftheabove
36. Supply of goods/services shall be terminated or suspended during the 

moratoriumperiod.Thisstatementis: 42.1stmeetingofcommitteeofcreditorsshallbeheldwithin____daysof
(a)True    (b)False itsformation.
(c)PartlyTrue    (d)Noneoftheabove (a)30  (b)7  (c)14  (d)14


43.In1stmeetingofcommitteeofcreditoritcaneitherresolvetoappoint
37.AAshallappointIRPwithin___daysofcommencementofprocess.
IRP or replace the IRO by another RP by majority vote of ___ % of voting
(a)7  (b)15  (c)30  (d)Noneoftheabove
share.

(a)51  (b)75  (c)33  (d)66
38.TenureofIRPshallbe: 
(a)Tillthedateofappointmentofresolutionprofessionalu/s22 44.CommitteeofcreditorcanresolvetocontinueIRPasRPsubjectto____
(b)Till180daysfromdateofappointment consentfromIRP.
(c)TillthetimespecifiedbyAdjudicatingAuthority (a)Oral    (b)Written
(d)Noneoftheabove (c)Both(a)&(b)   (d)Noneoftheabove
 
39.IRPvestedwithmanagementofcorporatedebtorshall: 45.IfCOCresolvestoreplacetheIRPthenitshallfileanapplicationtoAA
(a) Act&executeinname&onbehalfofcorporatedebtor forappointmentofnewRPalongwith:
(b) TakeactionsspecifiedbyInsolvency&BankruptcyBoardofIndia (a)WrittenconsentofIRP  (b)WrittenconsentfromRP
(c)Beresponsibleforcomplyingwithrequirementsunderanylawonbehalf (c)WrittenconsentfromproposedRP (d)Alloftheabove
ofcorporatedebtor 
(d)Alloftheabove 46. Rights & duties of Authorised representatives of financial creditor
 includes:
40. As per Regulation 16 of Insolvency & Bankruptcy Regulations, 2016 (a)Righttoparticipate&voteinmeetingofcommitteeofcreditoronbehalf
where corporate debtor has no financial debt or where financial creditors offinancialcreditor
arerelatedpartiesofcorporatedebtor,committeeshallconsistof: (b) Filing with committee of creditor any instruction received from financial
(a)18largestoperationalcreditorsbyvalue creditorforvoting
(b)1representativeelectedbyallworkmen (c)Circulate agenda&minutesofmeetingofcommitteeofcreditorstothe
(c) 1representativeelectedbyallemployees financialcreditorherepresents
(d)Alloftheabove (d)Alloftheabove

 


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47.RPshallgivenoticeofeachmeetingofcommitteeofcreditorto: 53.Whoisineligibletobearesolutionapplicant?
(a)Membersofcommitteeofcreditors (a)Anundischargedinsolvent  
(b)Membersofcommitteeifcreditorsincludingauthorizedrepresentatives (b)AWilfuldefaulterasperRBI
(c)MembersofsuspendedBOD/partnersofcorporatedebtor (c) Person whose account is classified as NPA & a period of 6 months has
(d)Both(b)&(c) elapsedfromsuchclassification 
 (d)ProhibitedbySEBI
48. RP shall give notice of each meeting of committee of creditor to 
operationalcreditorortheirrepresentativeifamountofaggregateduesis 54.Aftersubmissionofplan,COCmayapprovethesamebyvoteof:
___%ofdebt. (a)75% (b)50% (c)66% (d)90%
(a)ш10 (b)>10  (c)<10  (d)10 
 55. If resolution plan consists of provision for Combination u/s 5 of
49.Dutiesofresolutionprofessionalincludes: CompetitionAct,Applicantshalltakeapprovalfrom:
(a)Convene&attendallmeetingsofcommitteeofcreditor (a)RBI  (b)Cartel (c)CG (d)CompetitionCommissionofIndia
(b)PrepareInformationMemorandum 
(c)Inviteprospectivelenders,investorstoputforwardresolutionplans 56.CanResolutionProfessionalactasaLiquidator?
(d)Alloftheabove (a)Yes  (b)No  (c)Yes,withwrittenconsentbysuchRP
 (d)Yes,withwrittenconsentbysuchCOC
50. Resolution Professional can be replaced by Committee of Creditors by 
voteof: 57.Liquidatorcannotsellassets/propertiesofcompanytosuchperson:
(a)75% (b)50% (c)66% (d)90% (a)whoisapartofCOC  (b)whoisanOperationalCreditor
 (c)whowasineligibleu/s29A  (d)whoisaFinancialCreditor
51. If any disciplinary proceedings are pending against the proposed 
ResolutionProfessional,thentheexistingResolutionProfessionalshall: 58. Can Appeal be filed by Creditor against acceptance of claim by
(a)continueforever   (b)resign LiquidatorduringLiquidationProcess?
(c)continuetillnewRPisappointed (d)continuetillIBBIorders (a)Yes  (b)No
 
52.InformationMemorandumispreparedby: 59.FastTrackCIRPshallbecompletedwithin___days:
(a)ResolutionProfessional  (b)InterimResolutionProfessional (a)180  (b)90  (c)270  (d)45
(c)CommitteeofCreditors  (d)CorporateDebtor 
 60.FastTrackCIRPcanbemadeinrespectofwhichCorporateDebtor?
  (a)SmallCompanyasperIBC  (b)PartnershipStartupFirm
(c)AnyListedCompany  (d)Noneoftheabove


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61.AmountraisedfromAllotteeunderRealEstateProjectistreatedas:
(a)OperationalDebt  (b)FinancialDebt (c)Eitherof(a)or(b) ‡…—”‹–‹‡•‘–”ƒ…–
(d)CannotbetreatedasDebtatall
 ȋ‡‰—Žƒ–‹‘Ȍ…–ǡͳͻͷ͸Ƭ
62.QuorumforthemeetingofCOCshallbe__%ofVotingRights
(a)33% (b)67% (c)75% (d)50%
 —Ž‡•ǡͳͻͷ͹
63.IfAssesseehasinvestedinRealEstateunderan“AssuredReturnPlan”,
&notreceivedtheReturnortheRealEstateProperty,Assesseecanstillbe MCQscoverscertaingeneralinformationalsowhichneedstobeconsidered
treatedas: fromthissectiondirectlyforexaminationpurpose.
(a)FinancialCreditor  (b)OperationalCreditor 
(b)CorporateDebtor  (d)Noneoftheabove 1.SecuritiesContract(Regulation)Act,1956extendsto____________
 (a)WholeofIndiaexcepttheStateofJammuandKashmir
 (b)WholeofIndiaexcepttheStateofSikkim
 (c)WholeofIndiaexcepttheStateofJammuandKashmirandSikkim
MCQsAnswersofInsolvency&BankruptcyCode,2016 (d)Noneoftheabove
1.(b) 11.(a) 21.(b) 31.(c) 41.(c) 51.(c) 61.(b) 
  2.TheprovisionsofthisActshallnotapplyto
2.(a) 12.(a) 22.(b) 32.(b) 42.(b) 52.(a) 62.(a)
3.(b) 13.(b) 23.(c) 33.(d) 43.(d) 53.(c) 63.(a) (a)TheGovernment,theReserveBankofIndia(RBI),anylocalauthority,or
anycorporationsetͲupbyaspeciallaworanypersonwhohaseffectedany
4.(c) 14.(b) 24.(c) 34.(b) 44.(b) 54.(c) 
transactionwithorthroughtheagencyofanysuchauthorityasisreferredto
5.(b) 15.(d) 25.(d) 35.(c) 45.(c) 55.(d) 
inthisclause
6.(a) 16.(a) 26.(c) 36.(b) 46.(d) 56.(c) 
(b)Anyconvertiblebond orsharewarrantoranyoptionorrightinrelation
7.(c) 17.(d) 27.(d) 37.(d) 47.(d) 57.(c) 
thereto, in so far as it entitles that the person in whose favour any of the
8.(b) 18.(b) 28.(d) 38.(a) 48.(a) 58.(a) 
former has been issued to obtain shares (optional) on the basis of agreed
9.(a) 19.(d) 29.(d) 39.(d) 49.(d) 59.(b)  price.
10.(d) 20.(b) 30.(d) 40.(d) 50.(c) 60.(d)  (c)(a)and(b)
(d)Noneoftheabove

 

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