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CS Professional · Corporate Restructuring, Valuation and Insolvency · Cross Border Insolvency

Zenith Textiles Ltd has its registered office in Coimbatore and has been admitted to insolvency in India. A creditor asks which authority has jurisdiction over insolvency resolution and liquidation of this corporate debtor under the Insolvency and Bankruptcy Code, 2016. Which is correct?

The Adjudicating Authority is the National Company Law Tribunal bench having territorial jurisdiction over the place of the corporate person's registered office, here Coimbatore. The creditor's location, asset location or the appellate tribunal do not determine the forum for insolvency resolution or liquidation.

  1. AThe NCLT having territorial jurisdiction over the place of the company's registered officeCorrect
  2. BThe NCLT bench nearest to the creditor's place of business
  3. CThe Debt Recovery Tribunal at the place of the largest asset
  4. DThe NCLAT sitting at New Delhi as the first forum

Explanation

Section 60(1) makes the NCLT with territorial jurisdiction over the place where the registered office of the corporate person is located the Adjudicating Authority. The creditor's location or asset location does not decide the bench. The NCLAT is an appellate body, not the first forum.

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