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CS Professional · Corporate Restructuring, Valuation and Insolvency · Preparation and Approval of Resolution Plan

The Adjudicating Authority approved Gopal Pharma Ltd's resolution plan on 10 March 2025. The plan requires the resolution applicant to obtain a licence transfer under another law, and that law gives only six months for such approval. By when must the applicant obtain the necessary approvals under section 31(4)?

The applicant must obtain the approvals within one year from the Adjudicating Authority's approval date, or the period given in the other law, whichever is later. Here one year exceeds six months, so the deadline is one year from 10 March 2025.

  1. AWithin six months, being the period under the other law
  2. BWithin one year from 10 March 2025, since that is the later periodCorrect
  3. CWithin 90 days of the order
  4. DBefore the plan is approved by the committee of creditors

Explanation

Section 31(4) requires approvals within one year from the date of the Adjudicating Authority's approval or within the period provided in such law, whichever is later. One year is later than six months, so the deadline is one year from 10 March 2025. The six-month option ignores the 'whichever is later' wording.

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