Section 13 of The Insolvency and Bankruptcy Code, 2016.
- (1)The Adjudicating Authority, after admission of the application under section 7 or section 9 or section 10, shall, by an order—
- (a)declare a moratorium for the purposes referred to in section 14;
- (b)cause a public announcement of the initiation of corporate insolvency resolution process and call for the submission of claims under section 15; and
- (c)appoint an interim resolution professional in the manner as laid down in section 16.
- (2)The public announcement referred to in clause (b) of sub-section (1) shall be made immediately after the appointment of the interim resolution professional.
Summary
- The tribunal must issue a set of mandatory orders immediately after admitting an insolvency case.
- It must declare a moratorium, which is a temporary freeze on all debt recovery actions and lawsuits against the company.
- It must direct a public announcement to be made about the start of the insolvency process.
- It must issue a public call inviting all creditors to submit their financial claims.
- It must appoint an interim resolution professional to take charge of the company.
- The public announcement must be issued immediately after the interim resolution professional is appointed.
Practical examples
FAQ
1. What three orders must the tribunal pass upon admitting an application under The Insolvency and Bankruptcy Code, 2016?
Under Section 13 of The Insolvency and Bankruptcy Code, 2016, the tribunal must declare a moratorium, order a public announcement with a call for claims, and appoint an interim resolution professional.
2. When must the public announcement be made under Section 13 of the Indian Bankruptcy Code?
Under Section 13 of the Indian Bankruptcy Code, the public announcement of the insolvency process must be made immediately after the appointment of the interim resolution professional.
3. Which section of the Code is cross,referenced by Section 13 for declaring a debt freeze?
Under Section 13 of the 2016 Bankruptcy Code, the tribunal declares a moratorium for the purposes referred to in Section 14 of the Code.
Test yourself
Q1.Under Section 13 of The Insolvency and Bankruptcy Code, 2016, which of the following is NOT an order that the tribunal must pass immediately after admitting an insolvency application?
Q2.Under Section 13 of the 2016 Insolvency Code, when must the public announcement inviting claims be made?
Q3.Under Section 13 of the corporate law of 2016, which section details the appointment process of the interim resolution professional mentioned in the tribunal's admission order?
Q4.Under Section 13 of the Indian Bankruptcy Code, the declaration of a moratorium refers to the purposes laid down in which section?