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CS Professional · Corporate Restructuring, Valuation and Insolvency · Application for Corporate Insolvency Resolution Process

Ganga Steels Ltd filed a Section 9 application against Narmada Fabricators Pvt Ltd. It attached the demand notice but left out the affidavit required under Section 9(3)(b). The Adjudicating Authority finds the application incomplete and no other defect. What must it do before rejecting it?

It must first give the applicant a notice to rectify the defect within seven days of receiving that notice. The proviso to Section 9(5) makes this opportunity mandatory before an application can be rejected as incomplete.

  1. AReject it immediately, as incompleteness is a ground for rejection with no further step
  2. BAdmit it conditionally and ask for the affidavit within thirty days
  3. CGive notice to the applicant to rectify the defect within seven days of receipt of the noticeCorrect
  4. DRefer the matter to the Insolvency and Bankruptcy Board of India

Explanation

The proviso to Section 9(5) requires the Adjudicating Authority to give the applicant notice to rectify the defect within seven days of receipt before rejecting the application as incomplete. Immediate rejection skips this mandatory step.

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