Under the Insolvency and Bankruptcy Code 2017 certain persons are ineligible to submit resolution pl...........

Economic Affairs Industrial Sickness

Under the Insolvency and Bankruptcy Code 2017 certain persons are ineligible to submit resolution plans in case of a default. Which of the following fall under this category?

1. A willful defaulter

2. Promoters or management of the company if it has an outstanding non-performing debt for over a year and has not repaid the amount before submitting the plan.

3. Disqualified directors under the Companies Act 2013

4. A person convicted of an offense punishable with two or more years of imprisonment.

Select the correct answer using codes given below

1 and 2 only

1, 2 and 3 only

1 and 3 only

All of the above

छोटे Courses बड़े Results

Master Industrial Sickness

Prepare through Micro-courses

Try Now

Explanation:

..All the statements are correct. The Lok Sabha has passed the Insolvency and Bankruptcy Code (Amendment) Bill 2017 to pave the way for tightening loopholes in existing code and to make resolution process more effective.
Key Features of bill-
Resolution applicant: The bill redefines resolution applicant mentioned in code as a person who submits a resolution plan after receiving an invite by insolvency professional to do so.
Eligibility for resolution applicants: It amends provision related to eligibility in IBC to state that insolvency professional will only invite those resolution applicants to submit a plan, who fulfil certain criteria laid down by him with approval of committee of creditors and other conditions which may be specified by Insolvency and Bankruptcy Board.
Ineligibility to be a resolution applicant: It prohibits certain persons from submitting resolution plan in case of defaults. These include: (i) wilful defaulters, (ii) promoters or management of the company if it has outstanding non-performing debt for over year and (iii) disqualified directors, among others.
Liquidation: The bill bars the sale of property of a defaulter to such persons who is ineligible to be a resolution applicant during liquidation.
Penalties: The Bill inserts provision to specify that person contravening any provisions of IBC, for which no penalty has been specified, will be punishable with fine ranging between Rs. 1 lakh to Rs. 2 crore.