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CS Professional · Corporate Restructuring, Valuation and Insolvency · Application for Corporate Insolvency Resolution Process

Under section 7, an application by a financial creditor is incomplete because the record of default was not furnished. The Adjudicating Authority is satisfied on the other points. Which provision governs its power?

Where the application is incomplete, the Adjudicating Authority may reject it under section 7(5)(b), but must first give the applicant notice to rectify the defect within seven days of receiving that notice. The fourteen-day period concerns ascertaining default and does not govern rectification.

  1. AIt may reject the application, after giving notice to rectify the defect within seven daysCorrect
  2. BIt must admit the application since default may exist for any financial creditor
  3. CIt must refer the matter to the Insolvency and Bankruptcy Board before any order
  4. DIt may reject the application only after fourteen days' notice

Explanation

Section 7(5)(b) allows rejection where the application is incomplete. The proviso requires notice to rectify the defect within seven days of receipt of the notice. Fourteen days is the period for ascertaining default, not for rectification.

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