CMA Final · Corporate and Economic Laws · Insolvency and Bankruptcy Code, 2016
Which of the following statements about the territorial extent of the Insolvency and Bankruptcy Code, 2016, is correct as per Section 1 of the Code?
The Insolvency and Bankruptcy Code, 2016 extends to the whole of India under Section 1(2). It is a central enactment, so no State needs to adopt it, and it is not confined to particular cities or categories of territory.
- AIt extends to the whole of IndiaCorrect
- BIt extends only to the States and excludes all Union Territories
- CIt extends only to companies registered in metropolitan cities
- DIt extends to India but each State must separately adopt it
Explanation
Section 1(2) states that the Code extends to the whole of India. The Code is a central law that applies without any State-level adoption, and nothing in the text limits it by type of region or city of registration. The option on States excluding Union Territories is therefore wrong.
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