Insolvency of Partnership Firm and Individual – Corporate Restructuring, Insolvency, Liquidation & Winding-Up Important Questions
Question 1.
Explain the objective and procedural requirements for issuance of Public Notice under section 102 of the Insolvency and Bankruptcy Code, 2016. [Dec. 2019 – New Syllabus – 5 Marks]
Answer:
- As per Section 102 of the Insolvency and Bankruptcy Code, 2016, the Adjudicating Authority shall issue a public notice for inviting claims from the creditors of the debtor.
- The purpose of such public notice is to provide an opportunity to all the creditors to be a part of the repayment plan.
- The Adjudicating Authority shall issue a public notice within 7 days of passing the order, for inviting claims from all creditors within 21 days of such issue.
- Such public notice shall be
- published in at least one English and one vernacular newspaper which is in circulation in the state where the debtor resides;
- affixed in the premises of the Adjudicating Authority; and
- placed on the website of the Adjudicating Authority.
- The Public Notice u/s 102 shall include the following
(a) details of the order admitting the application;
(b) particulars of the resolution professional with whom the claims are to be registered; and
(c) the last date for submission of claims.
Question 2.
In a case of Individual Insolvency, creditors resolved to replace the Resolution Professional and approached you for an advice. Offer your views for replacing the Resolution Professional.
Answer:
- In case of individual Insolvency Resolution Process, a Resolution Professional can be replaced with another Resolution Professional. Section 98 of the IBC, 2016 provides for the grounds and the manner in which a resolution professional can be replaced.
- Where the debtor or the creditor is of the opinion that the Resolution Professional shall be replaced, he may apply to the Adjudicating Authority for such replacement.
- The Adjudicating Authority shall make a reference to the Board (within 7 days) for replacement of Resolution Professional.
- The Board shall recommend the name of a Resolution Professional to the Adjudicating Authority against whom no disciplinary proceedings are pending, (within 10 days).
- On the basis of the communication of the Board, the Adjudicating Authority shall pass an order appointing a new Resolution Professional.
- The Adjudicating Authority may give directions to the Resolution Professional to share all information with the new Resolution Professional and to co-operate with the new Resolution Professional, as may be required.