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CS Professional · Insolvency and Bankruptcy - Law and Practice · Insolvency Resolution of Individuals and Partnership Firms

Ravi is a partner in Ravi & Kapoor Associates. His brother-in-law's spouse is not a partner, but Kapoor's wife and Ravi's employee Sunil are known to him. For the purpose of Part III, which of the following persons is an 'associate' of Ravi?

Kapoor is Ravi's associate, because the definition of associate includes a person who is in partnership with the debtor. A mere customer, an unrelated lender or an outside shareholder do not fall within any listed category of associate.

  1. AKapoor, a person in partnership with RaviCorrect
  2. BA stranger who merely buys goods from the firm
  3. CA lender who has no relationship with Ravi
  4. DA customer who owns shares in a listed company

Explanation

Section 79(2)(c) makes a person who is in partnership with the debtor an associate. Kapoor is therefore an associate. A mere buyer, an unrelated lender or a shareholder customer fits none of the listed categories.

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