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CS Professional · Insolvency and Bankruptcy - Law and Practice · Corporate Insolvency Resolution Process

Orchid Engineering Ltd has filed a fast track application. On day 90 the Adjudicating Authority granted a 30-day extension. On day 115 the CoC wants a further 15 days, as the total would still be within 135 days. Under section 56, what is the position?

A second extension cannot be granted. The proviso to section 56(3) permits an extension of the fast track process only once, so after the 30-day extension was granted, a further 15 days is barred even though the total would be within 135 days, whatever the CoC vote.

  1. AA second extension cannot be granted, because an extension under the section may be granted only onceCorrect
  2. BA second extension of 15 days can be granted, as total time stays within 135 days
  3. CA second extension can be granted if 90% of the CoC votes in favour
  4. DA second extension can be granted if the corporate debtor consents

Explanation

The proviso to section 56(3) bars more than one extension regardless of the total period. The 30 days already granted used up the single extension, so staying within 135 days does not help. CoC voting percentage or debtor consent cannot override the proviso.

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