The Insolvency and Bankruptcy Code, 2016
Part-II Insolvency Resolution and Liquidation for Corporate Persons
Chapter-II Corporate Insolvency Resolution Process
Section 10: Initiation of corporate insolvency resolution process by corporate applicant.
*10. (1) Where a corporate debtor has committed a default, a corporate applicant thereof may file an application for initiating corporate insolvency resolution process with the Adjudicating Authority.
(2) The application under sub-section (1) shall be filed in such form, containing such particulars and in such manner and accompanied with such fee as may be prescribed.
1[(3) The corporate applicant shall, along with the application, furnish—
(a) the information relating to its books of account and such other documents for such period as may be specified;
(b) the information relating to the resolution professional proposed to be appointed as an interim resolution professional; and
(c) the special resolution passed by shareholders of the corporate debtor or the resolution passed by at least three-fourth of the total number of partners of the corporate debtor, as the case may be, approving filing of the application.]
(4) The Adjudicating Authority shall, within a period of fourteen days of the receipt of the application, by an order—
(a) admit the application, if it is complete 2[and no disciplinary proceeding is pending3 against the proposed resolution professional]; or
(b) reject the application, if it is incomplete 2[or any disciplinary proceeding is pending3 against the proposed resolution professional]:
Provided that Adjudicating Authority shall, before rejecting an application, give a notice to the applicant to rectify the defects in his application within seven days(i) from the date of receipt of such notice from the Adjudicating Authority.
(5) The corporate insolvency resolution process shall commence from the date of admission of the application under sub-section (4) of this section.
Reference
*Effective from 01.12.2016.
1. Subs. by the Insolvency and Bankruptcy Code (Second Amendment) Act, 2018, w.e.f. 06.06.2018, for the sub-section:
“(3) The corporate applicant shall, along with the application furnish the information relating to—
(a) its books of account and such other documents relating to such period as may be specified; and
(b) the resolution professional proposed to be appointed as an interim resolution professional.”
2. Ins. by the Insolvency and Bankruptcy Code (Second Amendment) Act, 2018, w.e.f. 06.06.2018.
3. Commencement of Disciplinary Proceeding-LA/010/2018, 23rd April, 2018.
Judicial Pronouncements:
J1. Hon’ble Supreme Court in M/S. Surendra Trading Company Vs. M/S. Juggilal Kamlapat Jute Mills Company Limited and Others [2017] ibclaw.in 08 SC held that provision of removing the defects within seven days under proviso to sub-section (5) of Section 7 or proviso to sub-section (5) of Section 9 or proviso to sub-section (4) of Section 10, is directory and not mandatory in nature.
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