CS Professional · Corporate Restructuring, Valuation and Insolvency · Cross Border Insolvency
Meridian Textiles Ltd is in CIRP. Its resolution professional (RP) believes the company owns a warehouse and receivables in a foreign country with which India has made reciprocal arrangements under section 234 of the Code. He needs evidence relating to these assets. What is the correct course under the Code's cross-border provision?
The RP must apply to the Adjudicating Authority. If it is satisfied that evidence or action on the foreign assets is required in the process, it may issue a letter of request to the competent foreign court or authority. The RP cannot issue the request himself.
- AApply to the Adjudicating Authority, which, if satisfied that evidence or action is required, may issue a letter of request to a court or authority of that countryCorrect
- BSend a letter of request directly to the foreign court without involving the Adjudicating Authority
- CApply to the Insolvency and Bankruptcy Board, which issues the letter of request to the foreign court
- DObtain a 66% vote of the committee of creditors, after which the RP may issue the letter of request himself
Explanation
Under section 235, the RP, liquidator or bankruptcy trustee applies to the Adjudicating Authority. If it is satisfied that evidence or action relating to the foreign assets is required, it may issue the letter of request to a competent court or authority of that country. The RP has no power to issue the request himself, and neither the Board nor a CoC vote is the route.
Did you get it right without looking?
One question tells you little. A timed set on Cross Border Insolvency shows your real accuracy, how long you take and where you lose marks.
More Cross Border Insolvency questions
- Ms. Iyer is an insolvency professional seeking to handle a cross-border matter. Her peer argues about who sets the minimum eligibility requi…
- In the liquidation of Bharat Steels Ltd, the liquidator believes that machinery is located in a country with which India has a Section 234 r…
- Meridian Textiles Ltd, an Indian company, has a subsidiary in Dubai that is also in financial distress. Mr. Rao, an insolvency professional,…
- Under Section 234(1) of the IBC, which statement correctly describes the Central Government's power regarding foreign countries?
- In a bankruptcy matter, a trustee finds that a personal guarantor of corporate debtor Sahyadri Infra Ltd holds property in a reciprocating c…
- The Central Government notifies that, for a country with which reciprocal arrangements exist, application of the IBC to a corporate debtor's…