CAIIB · BRBL

Resolution of stressed assets under insolvency and bankruptcy code 2016

Chapter notes, video classes, MCQ practice tests and quick-revision one-liners for Banking Regulations and Business Laws — CAIIB.

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Q

When did the Insolvency and Bankruptcy Code (IBC) 2016 come into force?

A

The IBC 2016 came into force on 28th May 2016, replacing several earlier insolvency laws and providing a unified framework for resolving insolvency of individuals, firms, and companies.

Q

What is the minimum default amount required for an operational creditor to initiate CIRP under IBC 2016?

A

One lakh rupees is the minimum default threshold.

Q

What is the primary objective of the Insolvency and Bankruptcy Code 2016?

A

The primary objective is to consolidate and amend laws relating to reorganisation and insolvency resolution of corporate persons, partnership firms, and individuals in a time-bound manner to maximise the value of assets.

Q

What is the time limit for completing Fast Track Insolvency Resolution Process under IBC 2016?

A

Fast Track CIRP must be completed within 90 days.

Q

Who is an Insolvency Resolution Professional (IRP) under the IBC 2016?

A

An IRP is a registered professional appointed to manage the affairs of a corporate debtor during the Corporate Insolvency Resolution Process (CIRP) and is regulated by the Insolvency and Bankruptcy Board of India (IBBI).

Q

Under IBC 2016, who appoints the Insolvency Resolution Professional during CIRP?

A

National Company Law Tribunal (NCLT) appoints the IRP.

Q

What is the time limit prescribed for completing the Corporate Insolvency Resolution Process (CIRP) under IBC 2016?

A

The CIRP must be completed within 180 days from the date of admission of the application, extendable by a further 90 days by the NCLT, and mandatorily completed within 330 days including any extensions and legal proceedings.

Q

What is Section 7 of IBC 2016 related to?

A

Section 7 allows financial creditors to initiate CIRP.

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