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CS Professional · Insolvency and Bankruptcy - Law and Practice · Adjudication and Appeals for Corporate Persons

The IBBI fails to perform an act within the period specified under the Code in a matter before the NCLT. Which statement about condonation of this delay under Section 198 is correct?

The Adjudicating Authority, here the NCLT, may condone the Board's delay, but only for reasons recorded in writing. Section 198 operates notwithstanding anything else in the Code and has no 15 day cap, which belongs to the Section 61 appeal proviso.

  1. AThe NCLT may condone the delay for reasons recorded in writingCorrect
  2. BThe NCLAT must condone it automatically without reasons
  3. CThe NCLT may condone the delay only if the Central Government consents
  4. DThe delay cannot be condoned because Section 61 fixes a 15 day ceiling for the Board

Explanation

Section 198 applies where the Board does not perform an act within the specified period. The relevant Adjudicating Authority may condone the delay, for reasons recorded in writing. The 15 day ceiling is in Section 61 for appeals, not Section 198, so it does not apply here.

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