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CS Professional · Insolvency and Bankruptcy - Law and Practice · Cross Border Insolvency (Elective 7.5)

The resolution professional of Anand Forgings Ltd applies under section 235 for a letter of request to a reciprocal country regarding a plant there. The Adjudicating Authority is not yet satisfied that evidence or action relating to the plant is actually required in connection with the CIRP. What follows?

The Adjudicating Authority may issue the letter of request only after being satisfied that evidence or action relating to the foreign assets is required in connection with the process. Filing the application does not make issuance automatic, and the letter goes to a competent court or authority of that country.

  1. AIt must issue the letter automatically once the application is filed
  2. BIt may issue the letter only on being satisfied that evidence or action is required in connection with the processCorrect
  3. CIt must refer the matter to the committee of creditors for voting
  4. DIt may issue the letter to any court worldwide regardless of reciprocal arrangements

Explanation

Section 235(2) gives the Adjudicating Authority a discretion: it 'may' issue the letter of request on being satisfied that evidence or action relating to the assets is required in connection with the process. It is not automatic, and the letter goes to a court or authority of the country competent to deal with the request.

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