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

The Adjudicating Authority approved the resolution plan of Sundaram Cables Ltd on 10 March 2025. The plan requires the resolution applicant to obtain a licence transfer under another law. That law prescribes a period of 6 months for such approval. Within what time must the applicant obtain the necessary approvals under section 31(4)?

The applicant has one year from the date of approval, that is until 10 March 2026. Section 31(4) gives one year or the period provided in the other law, whichever is later, and one year is longer than the six months allowed under the other law.

  1. AWithin 6 months, being the period under the other law
  2. BWithin 90 days from the date of approval of the plan
  3. CWithin one year from 10 March 2025, since this is later than the period under the other lawCorrect
  4. DWithin 30 days of the approval of the plan

Explanation

Section 31(4) requires the applicant to obtain necessary approvals within one year from the date of approval by the Adjudicating Authority, or within the period provided in the other law, whichever is later. One year is later than 6 months, so the applicant has until 10 March 2026. Option A picks the shorter period, which is wrong because the later one governs.

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