Skip to content

CS Professional · Corporate Restructuring, Valuation and Insolvency · Regulatory Approvals of Scheme

A student preparing a note on the Companies Act, 2013 claims that a Rehabilitation and Insolvency Fund under Section 269 can finance the revival of Meghdoot Pharma Ltd. Which statement is correct as per the official text?

The claim is incorrect because Section 269, which dealt with the Rehabilitation and Insolvency Fund, was omitted from the Companies Act, 2013 with effect from 15 November 2016. No such statutory fund is available under the Act to finance revival of a company.

  1. ASection 269 has been omitted w.e.f. 15-11-2016, so the claim is incorrectCorrect
  2. BSection 269 applies only if the scheme is sanctioned under Section 262
  3. CSection 269 fund applies to companies with accumulated losses above paid-up capital
  4. DSection 269 is valid and the fund is available to any sick company

Explanation

The official text lists Section 269 (rehabilitation and insolvency fund) as omitted by s. 255 and the Eleventh Schedule w.e.f. 15-11-2016. Hence the fund cannot finance any revival. The other options treat the section as operative.

Did you get it right without looking?

One question tells you little. A timed set on Regulatory Approvals of Scheme shows your real accuracy, how long you take and where you lose marks.

Practise Regulatory Approvals of SchemeFree diagnostic mock

More Regulatory Approvals of Scheme questions