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

Kavita Rao, an insolvency professional, is named as the proposed bankruptcy trustee in a bankruptcy application filed under section 122. The Adjudicating Authority received the application on 3 March. By what date must it direct the Board to confirm that no disciplinary proceedings are pending against her?

The direction must be given by 10 March. Under section 125(1), when an insolvency professional is proposed as bankruptcy trustee, the Adjudicating Authority must direct the Board within seven days of receiving the application to confirm no disciplinary proceedings are pending against that professional.

  1. ABy 10 March, i.e. within seven days of receiving the applicationCorrect
  2. BBy 13 March, i.e. within ten days of receiving the application
  3. CBy 17 March, i.e. within fourteen days of receiving the application
  4. DBy 2 April, i.e. within thirty days of receiving the application

Explanation

Section 125(1) requires the Adjudicating Authority to direct the Board within seven days of receiving the application. Three March plus seven days gives 10 March. The ten-day period belongs to the Board's response, not to the Authority's direction.

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