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CS Professional · Insolvency and Bankruptcy - Law and Practice · Pre-Packaged Insolvency Resolution Process (Elective 7.5)

The Adjudicating Authority admits the pre-pack application of Vindhya Alloys Pvt Ltd. A disciplinary proceeding is pending against the insolvency professional named in the application. Whom does the Authority appoint as resolution professional under section 54E?

The Adjudicating Authority appoints a resolution professional based on the recommendation of the Board. Under section 54E(1)(b), the professional named in the application is appointed only if no disciplinary proceeding is pending against him; otherwise the Board's recommendation decides.

  1. AThe named professional, since disciplinary proceedings are irrelevant
  2. BA professional chosen by the corporate debtor's directors
  3. CA professional based on the recommendation made by the BoardCorrect
  4. DA professional chosen by the members by ordinary resolution

Explanation

Under section 54E(1)(b), the named professional is appointed if no disciplinary proceeding is pending. If one is pending, the appointment is based on the Board's recommendation. Directors and members have no role in this replacement.

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