Model Question Paper (1 July 2017 to 31 December 2 017) Part-02

Q.1:- A corporate insolvency resolution process commences on the date of _______:

• date of admission of the application by the National Company Law Tribunal
• date of appointment of interim resolution professional.
• first meeting of the committee of creditors
• date of public announcement.

Q.2:- The management of the affairs of a corporate debtor undergoing corporate insolvency resolution process vests in the.

• Board of Directors.
• Insolvency and Bankruptcy Board of India.
• Interim Resolution Professional.
• Committee of Creditors.

Q.3:- A resolution professional shall file an application to the adjudicating authority to extend the period of fast track resolution if instructed to do so by a resolution passed at a meeting of the committee of creditors by a vote of not less than percent of the voting shares.

• 66
• 90
• 75
• 51

Q.4:- A liquidator collects the claims of creditors on commencement of the liquidation process. Which of the following is true in this regard?

• A creditor may withdraw or vary his claim.
• A creditor may withdraw but not vary his claim.
• A creditor may neither withdraw nor vary his claim.
• A creditor may not withdraw but vary his claim.

Q.5:- The expression “workmen’s dues” for the purpose of distribution of proceeds from the sale of liquidation assets under section 53 of the Insolvency and Bankruptcy Code, 2016 shall have the same meaning as assigned to it in the.

• the Recovery of Debts Due to Banks and Financial Institutions Act, 1993.
• the Companies Act, 2013.
• the Factories Act, 1948.
• the Securitisation and Reconstruction of the Financial Assets and Enforcement of the Securities Interest Act, 2002.

Q.6:- The debtor is discharged from interest by the Adjudicating Authority in respect of the qualifying debts under the Fresh Start Process from

• date of application till the date of the discharge order.
• date of admission of application till the date of discharge order.
• date of admission of application till the end of the moratorium period.
• date of application till the end of the moratorium period.

Q.7:- If an application is made for Insolvency Resolution Process by a partnership firm, an interim-moratorium shall commence on the date of the

• application in relation to all the debts and shall cease to have effect on the date of admission of such application.
• application in relation to qualifying debts and shall cease to have effect on the date of admission of such application.
• application in relation to all the debts and shall cease to have effect within 7 days of admission of such application.
• admission of application in relation to all the debts and shall cease to have effect within 7 days of admission of such application.

Q.8:- If a bankruptcy trustee has not been proposed in the application for bankruptcy of a debtor, the adjudicating authority shall.

• direct the Insolvency and Bankruptcy Board of India to nominate a bankruptcy trustee within 10 days.
• direct the creditor applicant to suggest a bankruptcy trustee within 10 days.
• reject the application.
• appoint a bankruptcy trustee from the database of insolvency professionals.

Q.9:- Which of the following is not true regarding the distribution of interim dividend by a bankruptcy trustee?

• The bankruptcy trustee shall make provision for disputed proofs and claims.
• Whenever the bankruptcy trustee has sufficient funds in his hand, he may declare and distribute interim dividend among the creditors in respect of the bankruptcy debts.
• The bankruptcy trustee shall not proceed with distribution of interim dividend, if contingent liabilities constitute more than 50% of the value of liquidation estate.
• If the bankruptcy trustee has declared any interim dividend, he shall give notice of such dividend and the manner in which it is proposed to be distributed.

Q.10:- The Insolvency and Bankruptcy Board of India has passed an order suspending certificate of registration granted to an Information Utility. The Information Utility, if aggrieved, may prefer an appeal to the.

• Minister for Corporate Affairs.
• National Company Law Tribunal.
• High Court of Delhi.
• National Company Law Appellate Tribunal.

Q.11:- If during the corporate insolvency resolution process or a liquidation process, it is found that any business of the corporate debtor has been carried on with intent to defraud creditors of the corporate debtor, the resolution professional may make an application in this regard to ________:

• the Insolvency and Bankruptcy Board of India
• the High Court
• the National Company Law Appellate Tribunal
• the National Company Law Tribunal

Q.12:- A Debt Recovery Tribunal may entertain or dispose of.

• a question of priorities arising out of insolvency of a corporate debtor.
• a criminal proceeding by or against an individual debtor.
• a claim made by a corporate debtor.
• a suit or a proceeding by or against an individual debtor.

Q.13:- Any transfer of property, not being a transfer or delivery made in the ordinary course of a company business, if made within a period of one year before the presentation of a petition for winding up by the Tribunal shall be against the Company Liquidator.

• void
• valid
• an offence
• voidable

Q.14:- An Interim Resolution Professional incurred an expenditure of Rs. 2 lakh on public announcement of a corporate insolvency resolution process. If the committee of creditors ratified an expenditure of Rs. 50,000 for the public announcement,…………

• the matter will be brought to the notice of NCLT for directions
• the remaining amount will become part of insolvency resolution process cost.
• the remaining amount will be borne by the applicant.
• the total amount of Rs.2 lakh will be insolvency resolution process cost.

Q.15:- Where all financial creditors are related parties of the corporate debtor, the committee of creditors shall comprise.

• all operational creditors.
• debenture holders.
• 18 largest operational creditors and one representative each of workmen and of employees.
• insolvency resolution professional and operational creditors.

Q.16:- Which of the following is not a requirement for a company to be registered as an insolvency professional agency?

• It is not under the control of person(s) resident outside India.
• It is promoted by a statutory regulator.
• It has a minimum net worth of ten crore rupees.
• Its sole object is to carry on the functions of an insolvency professional agency.

Q.17:- The Insolvency Professional Agency does not initiate disciplinary proceedings against a professional member based on.

• the directions given by the IBBI.
• a reference made by the Grievances Redressal Committee.
• the recommendation of the Committee of Creditors.
• monitoring of professional members.

Q.18:- An insolvency professional agency shall inform the IBBI within days, if any of its professional members has temporarily surrendered his certificate of membership.

• eight
• fifteen
• seven
• five

Q.19:- Who decides the fees payable to a liquidator under the IBBI (Liquidation Process) Regulations?

• Adjudicating Authority
• Corporate Debtor
• Committee of Creditors
• IBBI

Q.20:- Which of the following is eligible to voluntarily liquidate itself?

• Where debt equity ratio of the company is less than one.
• Where the company has no debt or can pay all its debts in full.
• Where the adjudicating authority does not receive a resolution plan of a company
• Where the committee of creditors decides to liquidate the company during the resolution period

Q.21:- The Annual Status Report indicating progress of the voluntary liquidation is not required to include the.

• developments in any material litigation.
• details of assets that are yet to be sold.
• distribution made to stakeholders.
• cost of realization of the assets.

Q.22:- The responsibilities of the Technical Committee under the IBBI (Information Utilities) Regulations, 2017, include.

• recommendations to the IBBI for laying Technical Standards.
• identification of chief technology officers of Information Utilities.
• evaluation of technology used by the Information Utilities.
• shortlisting of applicants for registration as Information Utilities.

Q.23:- The Preliminary Report under the IBBI (Liquidation Process) Regulations, 2016 may not contain____________.

• the details of the onerous property.
• the capital structure of the corporate debtor.
• the estimates of assets and liabilities of the corporate debtor on the liquidation commencement date.
• the proposed plan of action for carrying out the liquidation.

Q.24:- Which of the following creditors/ groups of creditors cannot reject a proposed resolution plan?

• Bank B2
• Bank B l and B 2 together
• GCC
• Bank B1

Q.25:- GCC is a/an for its claims against PC:

• Corporate Guarantor
• A financial as well as an operational creditor
• An operational creditor
• A financial creditor

Q.26:- The balance sheet of a company does not show

• financial health of the company.
• what the company owns and what the company owes.
• income and expenditure of the company.
• assets and liabilities of the company.

Q.27:- The Policy Repo Rate is the Reverse Repo rate.

• equal to
• 75% of
• higher than
• lower than

Q.28:- The Government of India may borrow upon the security of the

• Fiscal Fund of India
• Consolidated Fund of India
• Public Account of India
• Contingency Fund of India

Q.29:- As per the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002, what constitutes as ‘non­ performing assets’?

• An account for which a borrower has refused to repay.
• An asset of a borrower which has been classified by a credit rating agency as doubtful.
• An asset or an account of a borrower which has been classified by a bank as doubtful or sub-standard.
• An asset of borrower’s subsidiaries company.

Q.30:- Which of the following decides applications from the banks and financial institutions for recovery of debts due to them?

• Debt Recovery Appellate Tribunal
• Debt Recovery Tribunal
• Central Board of Direct Taxes
• Securities Appellate Tribunal

Q.31:- As per the Sale of Goods Act, 1930, as a stipulation collateral to the main purpose of the contract, the breach of which gives rise to a claim for damages but not to a right to reject the goods and treat the contract as repudiated.

• guarantee
• condition or warranty
• condition
• warranty

Q.32:- As per the Indian Contract Act, 1872, the contract iswhere both parties are under mistake as to matter of fact essential to the agreement.

• valid
• void
• voidable at the option of party least at fault
• voidable at the option of either party

Q.33:- Which of the following circumstances is not a condition for winding up of limited liability partnership by the Tribunal?

• if the limited liability partnership has made a default in filing with the Registrar the Statement of Accounts and Solvency or annual return for any two consecutive financial years
• the number of partners of the limited liability partnership is reduced below two for the last 12 months.
• the number of partners of the limited liability partnership is reduced below two for the last 9 months.
• the limited liability partnership decides that it would be wound up by the Tribunal.

Q.34:- As per the Indian Partnership Act, 1932 regarding dissolution of partnership at will, a partnership firm with four partners at will may be dissolved, if any of the partners gives notice to partners of his intention to dissolve the firm.

• either verbally or in writing, all other
• verbally, all other
• in writing, any of the two other
• in writing, all other

Q.35:- Can a member function as a Bench of National Company Law Tribunal?

• Yes, only in exigencies when no other member is available.
• Yes, a technical member, if duly authorised.
• No, a member cannot function as a Bench.
• Yes, judicial member, if duly authorised.

Q.36:- The date from which the scheme of mergers and amalgamation of companies is effective is………….:

• date of order of merger by National Company Law Tribunal.
• date of creditor’s assent to merger.
• appointed date.
• effective date.

Q.37:- Par value of a share means-

• dividend value of the share
• market value of the share
• face value of the share
• actual value of the share

Q.38:- An order of the IBBI directing an inspecting authority to conduct an inspection of records of a service provider may not contain.

• scope of inspection
• composition of inspecting authority
• timelines for conducting the inspection
• privileges of service provider

Q.39:- In a Fast Track Insolvency Resolution Process, the fast track process costs do not include.

• the amount due to suppliers of essential goods and services.
• the amount of any interim finance and the costs incurred in raising such finance.
• the cost incurred by the resolution professional in running the business of the corporate debtor as a going concern.
• the expenses on public announcement not ratified by the committee of creditors.

Q.40:- “S4A” scheme of RBI stands for

• Scheme for Sustainable Structuring of Systemic Assets
• Scheme for Sustainable Structuring of Stressed Assets
• Scheme for Schematic Structuring of Stressed Assets
• Scheme for Schematic Structuring of Systemic Assets