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CS Professional · Corporate Restructuring, Valuation and Insolvency · Liquidation on or after Failing of Resolution Plan

In a pre-packaged insolvency resolution process for Ganga Foods Ltd, the resolution professional has not received CoC approval for any resolution plan by the end of the ninety-day period from the commencement date. What must the resolution professional do?

The resolution professional must file an application with the Adjudicating Authority for termination of the pre-packaged process on the day after the ninety-day period expires, since no resolution plan was approved by the committee of creditors within that period.

  1. AWait until day 120 and then pass a liquidation order himself
  2. BOn the day after expiry of that period, file an application with the Adjudicating Authority for termination of the pre-packaged processCorrect
  3. CConvert the process into a regular CIRP automatically
  4. DContinue the process for another 90 days

Explanation

Section 54D(2) requires submission of the approved plan within ninety days. Under section 54D(3), if no plan is approved in that period, the resolution professional must, on the day after expiry, apply to the Adjudicating Authority for termination. The resolution professional cannot pass liquidation orders.

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