Skip to content

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

Mr. Shah, liquidator of Aarav Exports Ltd, consults some secured creditors about the best way to realise the assets and decides to follow a different course. Which statement is correct?

The consultation does not bind him. Under section 35(2) the liquidator may consult stakeholders entitled to distribution, but need not follow their views, and the records of the consultation must be made available to stakeholders who were not consulted, as the Board specifies.

  1. AConsultation is not binding on him, but records of it must be made available to stakeholders not consultedCorrect
  2. BConsultation binds him if a majority of those consulted agree
  3. CHe may not consult any stakeholder without Adjudicating Authority permission
  4. DRecords of consultation are confidential and need not be shared

Explanation

Section 35(2) lets the liquidator consult stakeholders entitled to distribution under section 53. The consultation is not binding, and records must be made available to the other stakeholders not consulted, in the manner specified by the Board.

Did you get it right without looking?

One question tells you little. A timed set on Liquidation on or after Failing of Resolution Plan shows your real accuracy, how long you take and where you lose marks.

Practise Liquidation on or after Failing of Resolution PlanFree diagnostic mock

More Liquidation on or after Failing of Resolution Plan questions