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CS Professional · Insolvency and Bankruptcy - Law and Practice · Corporate Insolvency Resolution Process

The CIRP period of Deccan Polymers Ltd expires while the resolution plan awaits the Adjudicating Authority's decision. The RP asks whether his authority to manage the company has ended. Under section 23, what is the correct position?

The resolution professional continues to manage the corporate debtor's operations after the CIRP period expires, until the Adjudicating Authority passes an order approving the resolution plan under section 31(1) or appointing a liquidator under section 34. Expiry of the period alone does not end his role.

  1. AHis authority ends on expiry of the CIRP period, and the board of directors resumes
  2. BHe continues to manage the operations until an order approving the plan under section 31(1) or appointing a liquidator under section 34 is passedCorrect
  3. CHe continues only for 30 days after expiry
  4. DHe continues only to file reports, not to manage operations

Explanation

The proviso to section 23(1) says the RP continues to manage the operations after the CIRP period expires until an order approving the plan under section 31(1) or appointing a liquidator under section 34 is passed. The board does not resume control at expiry, and no fixed 30-day limit is mentioned.

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