IBBI Securities & Financial Assets flashcards

33 cards. Read the term and the definition here. The deck at the top of this page is optional.

Section 7 application

An application by a financial creditor to initiate CIRP against a corporate debtor for default of Rs 1 crore or more, filed with the NCLT under the IBC.

Section 9 application

An application by an operational creditor to initiate CIRP after serving a 10-day demand notice on the corporate debtor and the debt remaining unpaid.

Section 10 application

A voluntary application by a corporate debtor to initiate its own CIRP, requiring a special resolution and financial statements, and showing no prior CIRP in 12 months.

Section 14 moratorium

A court-ordered bar on suits, asset transfers, security enforcement and recovery proceedings against the corporate debtor during the CIRP period.

Section 29A disqualification

A rule barring wilful defaulters, NPAs over one year, connected persons of disqualified applicants, and convicted persons from submitting a resolution plan.

Section 31 resolution plan

A CoC-approved resolution plan that, once approved by NCLT, binds the corporate debtor and all stakeholders, including government authorities.

Section 12A withdrawal

A provision allowing withdrawal of a CIRP application with the approval of 90% of the CoC voting share, typically before a resolution plan is approved.

Section 33 liquidation

A provision under which NCLT orders liquidation of the corporate debtor when the CoC rejects a resolution plan or the plan is not implemented.

Section 53 waterfall

The order of priority for distributing liquidation proceeds: insolvency costs, secured creditors, employee wages, financial debts, government dues, and residual to shareholders.

Section 66 fraudulent trading

A provision allowing NCLT to order a person who carried on business to defraud creditors to contribute to the corporate debtor's assets.

Section 43 preferential transactions

A transaction giving a creditor or surety an advantage over others during the look-back period, which the RP may apply to avoid or reverse.

Section 45 undervalued transactions

A transfer of assets for significantly less than market value during the look-back period, which the RP may challenge to restore value to the estate.

Section 12A 90% threshold

The CoC voting share required to approve withdrawal of a CIRP application, as amended in 2019 to replace the earlier 75% threshold.

Section 60 NCLT jurisdiction

The NCLT bench having territorial jurisdiction over the corporate debtor's registered office hears IBC applications and related proceedings.

Section 5(8) financial debt

A debt disbursed against the consideration for time value of money, including loans, bonds, debentures, and amounts raised under derivative transactions.

Section 5(21) operational debt

A claim for goods or services, employment dues, or government dues payable to an operational creditor, distinct from financial debt.

Section 22 RP appointment

The CoC may replace the IRP with a resolution professional by a 66% vote, subject to the RP being a registered insolvency professional.

Section 24 CoC meetings

The RP convenes CoC meetings, sets the agenda, and records minutes; the CoC quorum is 33% of voting share.

Section 25 RP duties

The RP must take control of the corporate debtor, manage its operations, prepare the information memorandum, and conduct the CIRP within timelines.

Section 28 CoC approval

Certain RP actions, such as raising interim finance or creating security, require prior approval of the CoC by a 66% vote.

Section 30 plan submission

A resolution applicant submits a plan to the RP, who must present it to the CoC for approval; the plan must comply with Section 30(2) requirements.

Section 32A immunity

A provision granting immunity to a corporate debtor from prosecution for offences committed before the CIRP, subject to conditions in the plan.

Section 35 liquidation powers

The liquidator may sell assets, institute or defend suits, and distribute proceeds in accordance with Section 53 of the Code.

Section 36 liquidation estate

The pool of assets available for distribution in liquidation, excluding assets held in trust and certain personal assets of the corporate debtor.

Section 53A secured creditors

A provision allowing secured creditors to realise their security interest in liquidation, outside the Section 53 waterfall, in certain circumstances.

Section 54 PPIRP

A pre-packaged insolvency resolution process for MSMEs, introduced in 2021, allowing a debtor to propose a base resolution plan before formal admission.

Section 188 IBBI

The provision establishing the Insolvency and Bankruptcy Board of India as the regulator to register professionals and issue regulations under the Code.

Section 196 IP registration

The IBBI registers insolvency professionals, who must pass a professional examination and comply with continuing education requirements.

Section 231 NCLAT appeal

An appeal against an NCLT order lies to the NCLAT within 30 days, and the NCLAT must dispose of the appeal within 30 days.

Section 62 Supreme Court appeal

An appeal against an NCLAT order lies to the Supreme Court within 45 days, on a question of law or fact.

CIRP 330-day limit

The outer time limit for completing the corporate insolvency resolution process, including extensions and litigation, per Section 12 as amended.

Information utility

An entity registered with IBBI that stores financial information and provides evidence of default to support IBC applications.

Insolvency professional agency

An entity registered with IBBI that enrolls insolvency professionals and enforces professional standards and a code of conduct.