Skip to content

CS Professional · Insolvency and Bankruptcy - Law and Practice · Introduction to Insolvency and Bankruptcy Code

The Board receives the Adjudicating Authority's direction concerning Suresh Iyer, who was proposed as bankruptcy trustee. Disciplinary proceedings are pending against him. Under Section 125, what is the Board's course of action and time limit?

The Board has ten days from receiving the direction to either confirm the proposed professional or reject him and nominate another bankruptcy trustee. Because disciplinary proceedings are pending against Suresh, the appropriate step is rejection and nomination of a different trustee within that ten-day period.

  1. AWithin ten days, reject his appointment and nominate another bankruptcy trusteeCorrect
  2. BWithin seven days, reject his appointment and leave the choice to the creditors
  3. CWithin ten days, confirm him but record the pending proceedings
  4. DWithin seven days, return the matter to the Adjudicating Authority without a decision

Explanation

Section 125(2) gives the Board ten days from receipt of the direction either to confirm the proposed professional or to reject him and nominate another bankruptcy trustee. With disciplinary proceedings pending, confirmation is not the path contemplated; rejection with nomination of another trustee is. The seven-day period applies to the Authority's direction.

Did you get it right without looking?

One question tells you little. A timed set on Introduction to Insolvency and Bankruptcy Code shows your real accuracy, how long you take and where you lose marks.

Practise Introduction to Insolvency and Bankruptcy CodeFree diagnostic mock

More Introduction to Insolvency and Bankruptcy Code questions