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CS Professional · Corporate Restructuring, Valuation and Insolvency · Pre-Packaged Insolvency Resolution Process

In a PPIRP of Narmada Foods Ltd, the commencement date is 1 March. The committee of creditors has not approved any resolution plan by the end of the period within which the resolution professional must submit the approved plan to the Adjudicating Authority. What must the resolution professional do?

The resolution professional must file an application for termination of the PPIRP on the day after the 90-day period expires. Section 54D(3) triggers this duty when no plan is approved by creditors within ninety days from commencement, not at 120 days.

  1. AWait until day 120 and then file for termination
  2. BFile an application for termination on the day after the 90-day period expiresCorrect
  3. CAutomatically extend the process by 30 days without any application
  4. DConvert the process to liquidation by his own order

Explanation

Section 54D(2) requires submission of the approved plan within 90 days of commencement. Under 54D(3), if no plan is approved in that period, the RP files a termination application on the day after it expires. The 120 days is the outer limit for completion, not the trigger.

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