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CS Professional · Corporate Restructuring, Valuation and Insolvency · Insolvency

Vidarbha Insolvency Forum, a newly formed body, begins enrolling insolvency professionals as members and offering them services under the Insolvency and Bankruptcy Code, 2016, but has not applied to the Insolvency and Bankruptcy Board of India for any certificate. Which statement is correct?

The forum cannot function or enrol insolvency professionals as members without a valid certificate of registration issued by the Board. The Code bars any person from carrying on business as an insolvency professional agency except under such a certificate, so operating before registration is unlawful.

  1. AIt may operate until the Board rejects its application, since registration is only a formality
  2. BIt may enrol members if its bye-laws are approved by the Central Government
  3. CIt may not carry on business as an insolvency professional agency or enrol insolvency professionals as members without a valid certificate of registration issued by the BoardCorrect
  4. DIt may enrol members provided it publishes the list of members on its website

Explanation

The Code provides that, save as otherwise provided, no person may carry on business as an insolvency professional agency and enrol insolvency professionals as members except under a certificate of registration issued by the Board. Option A is wrong because no operation is allowed before registration is granted.

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