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CS Professional · Corporate Restructuring, Valuation and Insolvency · Role, Functions and Duties of IP, IRP and RP

Ms. Farah Siddiqui's name has been approved as the proposed resolution professional under section 54A(2)(e) for a corporate debtor planning a pre-packaged insolvency resolution process, but the process has not yet been initiated. Which statement is correct about her position under section 208?

She must take such actions as are necessary to perform her functions and duties before the pre-packaged process is initiated. Section 208(1A) extends the professional's function to the pre-initiation stage once the proposed resolution professional's name is approved under section 54A(2)(e).

  1. AShe has no function under the Code until the Adjudicating Authority admits the application
  2. BShe must take such actions as may be necessary to perform her functions and duties prior to the initiation of the pre-packaged processCorrect
  3. CShe is bound by the code of conduct only after the committee of creditors is constituted
  4. DShe may perform only the functions of an insolvency professional agency before initiation

Explanation

Section 208(1A) applies where the proposed resolution professional's name is approved under section 54A(2)(e). It makes it her function to take necessary actions to perform her functions and duties before the pre-packaged process begins. Hence she is not idle until initiation, and the code of conduct in 208(2) applies to every insolvency professional.

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