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CS Professional · Insolvency and Bankruptcy - Law and Practice · Corporate Insolvency Resolution Process

In Kaveri Steels Ltd, the CoC passes a valid resolution to replace the RP and forwards the proposed professional's name to the Adjudicating Authority. What does the Adjudicating Authority do next under the Code?

The Adjudicating Authority forwards the name of the proposed resolution professional to the Insolvency and Bankruptcy Board for confirmation, and the appointment is then made in the same manner as laid down in section 16. It does not appoint directly or involve the debtor's board.

  1. AAppoints the proposed professional directly without any further reference
  2. BForwards the name to the Board for confirmation, and the RP is appointed in the manner laid down in section 16Correct
  3. CRejects the proposal and asks the CoC to nominate three names
  4. DAsks the corporate debtor's board to approve the name

Explanation

Section 27(3) and (4) require the CoC to forward the name to the Adjudicating Authority, which forwards it to the Board for confirmation. The appointment follows the manner in section 16. Direct appointment skips the Board's confirmation, which is why the first option is wrong.

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