Q: How is the resolution plan approved ?

Ans: Under the Insolvency and Bankruptcy Code, 2016 (“I&B Code”), a Corporate Insolvency Resolution Process (“CIRP”) is initiated with an order of the Adjudicating Authority (“NCLT”) admitting an application by a creditor or debtor. As soon as the application under relevant sections of the I & B Code is admitted, a Resolution Professional (“RP”) is appointed by the NCLT.
The RP then constitutes the Committee of Creditors (“CoC”) as provided under the I&B Code. Further, prospective resolution applicants are invited to submit a resolution plan and thereafter, the plan is voted and approved by the CoC and the NCLT respectively. Once approved, the resolution plan is binding on all the stake holders.
x

Comments

Post a Comment

Popular posts from this blog

Q: What is corporate applicant ?

Ans: Corporate Applicant: The term 'Corporate Applicant' is defined under Section 5(5) of the IBC to include the company itself and any member, partner or individual who is authorised to supervise or control the affairs of the company. When a Corporate Debtor commits a default, a corporate applicant can initiate insolvency in terms of Section 10 of the IBC. In simple words, when a company becomes a corporate debtor and it wants to initiate a corporate insolvency resolution process against itself, such a corporate debtor being the corporate applicant can file a Petition under Section 10 of the IBC. It is to be noted here that company is corporate applicant who renders credit and company is also a corporate debtor and since every member of company is corporate debtor, so any member can file petition under Section 10 of IBC . 
Read more

Q: Delineate about the appointment of resolution professional ?

  Appointment of RP: Since an RP is someone who is appointed by a Committee of Creditors (hereafter, referred to as “CoC”) before its constitution an Interim RP is appointed because committee of creditors take all the important decisions in corporate insolvency resolution process from appointment of resolution professional to termination of resolution professional. The interim RP acts in the same way an RP would and manages the affairs of the CD till the appointment of an RP. As per section 22 of the Insolvency and Bankruptcy Code, 2016 (hereafter, referred to as the “Code”) within seven days of the CoC’s formation it must hold its first meeting and decide whether it would like to appoint the Interim RP as the RP or it can select a new RP. The outcome of the same must be communicated to the RP, the Corporate debtor and the NCLT.  The NCLT is a tribunal here for RP and CoC and it was constituted under section 408 of companies act, 2013.  NCLT is a quasi judicial body and i...
Read more