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CS Professional · Insolvency and Bankruptcy - Law and Practice · Introduction to Insolvency and Bankruptcy Code

Kaveri Textiles Ltd's lawyer states that the IBC, 2016 extends only to the states and not to the Union Territories of Jammu and Kashmir and Ladakh. As per the official text, what is the correct position?

The Code extends to the whole of India under Section 1(2). The proviso that earlier applied to Jammu and Kashmir was omitted by the 2020 adaptation orders for Jammu and Kashmir and for Ladakh, so the lawyer's claim of exclusion is incorrect.

  1. AThe Code extends to the whole of India; the earlier proviso on Jammu and Kashmir was omitted by the 2020 adaptation ordersCorrect
  2. BThe Code excludes Ladakh because its adaptation order added a proviso
  3. CThe Code applies to the whole of India only after a separate notification for each Union Territory
  4. DThe Code applies to Jammu and Kashmir only through a State law

Explanation

Section 1(2) says the Code extends to the whole of India. The proviso relating to Jammu and Kashmir was omitted by the 2020 adaptation orders for Jammu and Kashmir and for Ladakh. So the lawyer's claim is wrong.

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