1. Section 66A of Information Technology Act was held unconstitutional in the case of
a) Justice K. S. Putta swamy Vs Union of India
b) M P Sharma Vs Satish Chandra
c) Shreya Singhal Vs Union Of India
d) Gagan Harsh Sharma Vs The State of Maharashtra

2. A Teacher is not a workman within the purview of Industrial Disputes Act, held in the case of

a) The Workmen vs Greaves Cotton & Co. Ltd. & Ors
b) John Joseph Khokar Vs Bhadange B. S. & ors
c) A. Sundarambal Vs Government of Goa
d) Dinesh Sharma and Ors. Vs State of Bihar

3. According to Factories_Act_1948
a) “child” means a person who has not completed his fifteenth year of age;
b) “child” means a person who has not completed his fourteenth year of age
c) “child” means a person who has not completed his eighteenth year of age
d) “child” means a person who has not completed his sixteenth year of age

4. The UNCITRAL Model Law and Rules do not become part of the Arbitration Act so as to become an aid to construe the provisions of the Act.- held in the case of
a) Union of India Vs East Coast Boat Builders and Engineers Ltd.,
b) Union of India Vs M.C. Mehta
c) Tata Press Ltd Vs Union of India
d) Union of India Vs Indian Change Chrome Ltd

5. According to Section 7(4) of the Arbitration and Conciliation Act, an arbitration agreement is in writing if it is contained in—
a) a document signed by the parties;
b) an exchange of letters, telex, telegrams or other means of telecommunication which provide a record of the agreement;
c) an exchange of statements of claim and defence in which the existence of the agreement is alleged by one party and not denied by the other.
d) All of the above

6. Waiver of right to object deviance from arbitration agreement is mentioned under ——— of the Arbitration and Conciliation Act
a) Section 7
b) Section 4
c) Section 20
d) Section 22

7. A intentionally and falsely leads B to believe that certain land belongs to A, and thereby induces B to buy and pay for it. The land afterwards becomes the property of A, and A seeks to set aside the sale on the ground that, at the time of the sale, he had no title.
He will not be allowed to prove his want of title.- Which Section of the Evidence Act is applicable?

a) Section 92
b) Section 124
c) Section 115
d) Section 101

8. The Arbitration Act 1996 repeals
a) The Arbitration Act, 1940,
b) The Arbitration (Protocol and Convention) Act, 1937
c) the Foreign Awards (Recognition and Enforcement) Act, 1961.
d) All of the above

9. Section 265A to 265L, Chapter XXIA of the Criminal Procedure Code deals with the concept of
a) Unlawful Assembly
b) Arrest without warrant
c) search and seizures
d) Plea bargaining

10. Security for good behaviour from habitual offenders is dealt under
a) Section 109 in Cr.P.C

b) Section 110 of Cr.P.C

d) None of the above

Information

IN THE COURT OF CIVILJUDGE, (Senior Division)…….
Suit no . . . . . . . . . of 20. . .

IN THE MATTER OF:
Mr. A
S/O ______________
R/O_______________ … Plaintiff
VERSUS
M/s XYZ
CIN:
Regd. Office: _______________ …Respondent/ Defendants

Through its Director and Authorised Signatory,
Shri Mr. B
S/O______________
R/O______________

Plaint filed on behalf of the plaintiff under Order VII Rule-10 and long cause title.
1. That Plaintiff Mr. A, S/o. ________, ______ years, Hindu, job, residing at  ___________

2. That Respondent/ Defendants is M/s XYZ incorporated under the Companies Act, 2013
and having its registered office of__________________________________________
through its Director and Authorised Signatory is Mr. B, S/o. ______aged _______ years,
Hindu, Job, residing at _________________________.
Written Statement of the Respondent under Order 8 Rule 1
(or Written Statement on behalf of all the Respondents)
The respondent(s) respectfully state(s) as follows : –
(1) Para no. 1 of the plaint is purely based on facts and defendant do not any
objections on the same.
(2) Para no. 2 of the plaint is purely based on facts and defendant do not any
objections on the same.
(3) Para no. 3 of the plaint is purely based on facts and defendant do not any
objections on the same.

(4) Para no. 4 of the plaint is denied and not admitted on the basis of the following
grounds as:-
1. The Plaintiff was on Leave.
2. Claims to be on medical leave.
3. No documents / fitness certificate submitted.
4. Internal Policy without adequate proofs salary cannot be credited.
5. Employee has already exhausted the limit of leave which are granted
by an Organisation in a calendar year.
6. In case of proof are submitted salary for the days when he has reported.
(5) Para no. 5 of the plaint is purely based on facts and defendant do not any
objections on the same.
(Facts constituting cause of action)
(6) Para no. 6 of the plaint is purely based on facts and defendant do not any
objections on the same.
(7) Para no. 7 of the plaint is purely based on facts and defendant do not any
objections on the same.
(8) Para no. 8 of the plaint is purely based on facts and defendant do not any
objections on the same.
(9) Para no. 9, the plaint is denied and not admitted on the basis of the following
grounds as:-
1. The plaintiff has been well informed verbally and via email that due to lockdown,
Respondent will not able to pay his salary until 30th May 2021. He was agreed to
that he has his consent over email.
2. The plaintiff has not admitted it in the plaint. And Said Plaintiff has been filed a
mischievous ground, so no claims of court fees can be entertained.
3. The Plaintiff was on Leave. Claims to be on medical leave. No documents / fitness
certificate submitted.
4. Internal Policy without adequate proofs salary cannot be credited.

5. Employee has already exhausted the limit of leave which are granted by
organisation in a calendar year. In case of proof are submitted salary for the days
when he has reported.
(10) Para No 10 of the plaint is purely based on facts and defendant do not any
objections on the same.
(11) Para No 11 of the plaint is purely based on facts and defendant do not any
objections on the same.
(Jurisdiction/Optional)
Respondent has committed to pay the salary as per terms and conditions agreed by
__/__/_. Respondent already has consent from the plaintiff. The respondent
therefore prays that the suit be dismissed with costs.
VERIFICATION
Verified at [Place] on this [Date:_____…] that the contents of paras 1 to 11 of the
plaint are true to my knowledge derived from the records of the Plaintiff maintained
in the ordinary course of its business, those of paras1 to 11 are true on information
received and believed to be true and last para is the humble prayer to this Hon’ble
Court.
Dated: __/__/___

Advocate for the Defendant Defendant

List of the document filed
 Copy of the email having consent to delay the salary.

EXAMINATION OF THE PLAINT
1. Examination of plaints/petitions/applications etc:- On the presentation or receipt of a plaint, the Court should examine it with special reference to the following points, viz:-
(i) Whether the plaint contains the particulars specified in Order VII, Rule 1, and conforms to the other rules of pleadings in Orders VI and VII and rules made by the High Court
thereunder;
(ii) Whether there is, prima facie, any non-joinder or mis-joinder of parties, or mis-joinder of causes of action;
(iii) whether any of the parties to the suit are minors and, if so, whether they are properly represented as laid down in Chapter 1- M (d) of this volume;
(iv) whether the plaint is duly signed and verified;
(v) whether the suit is within the jurisdiction of the Court or must be returned for presentation to proper Court (Order VII, Rule 10 );
(vi) whether the plaint is liable to be rejected for any of the reasons given in Order VII, Rule 11;
(vii) whether the documents attached to the plaint (if any) are accompanied by lists in the prescribed form and are in order;
(viii) whether the plaintiff has filed a proceeding containing his address for service during the litigation as required by Rule 19 of Order VII as framed by the High Court.
(ix) In money suits, whether the plaintiff has stated the precise amount the claims;
(x) Whether the plaintiff has stated in his plaint regarding the documents on which he relies his claim and are not in his possession and a statement in whose possession or power they are;
(xi) Whether the plaintiff has filed the address of the party in the prescribed form.
2. Pleadings:- The provisions of the Code, with regard to the pleadings (which term includes the plaint and written statements of parties) should be carefully studied. The principal rules of pleadings may be briefly stated as follows:
(a) The whole case must be stated in the pleadings, that is to say all material facts must be stated (Order VI, Rule 2).
(b) Only material facts are to be stated. The evidence by which they are to be proved is not to be stated (Order VI, Rules 2, 10, 11 and 12).
(c) The facts are to be stated concisely.
(d) It is not necessary to allege the performance of any condition precedent; and averment of performance is implied in every pleading but a non-performance of condition precedent, if relied on, must be distinctly stated (Order VI, Rule 6).
(e) It is not necessary to set out the whole or any part of a document unless the precise words thereof are necessary. It is sufficient to state the effect of the document as briefly as
possible (Order VI, Rule 9).
(f) It is not necessary to allege a matter of fact which the law presumes, or as to which the burden of proof lies on the other side (Order VI, Rule 13).
(g) When misrepresentation, fraud, undue influence, etc., are pleaded, necessary particulars must always be given (Order VI, Rule 4).
(h) When a suit is prima facie time-barred, the ground on which exemption is claimed must be stated (Order VII, Rule 6).

If the plaint is prolix (lengthy) or indefinite or omits to give the necessary particulars or to specify the relief claimed precisely or is defective in any other respect, it should be returned to the party or his counsel for such amendment as may be necessary in the actual presence of the presiding officer after he has signed the endorsement. The Court has wide powers in this respect (see Order VI, Rule 16 and 17). Where amendment is directed, an order should be recorded by the Judge indicating the particulars about the necessary
amendment and fixing a date for filing the amended plaint.

3. Non-joinder and mis-joinder of parties and causes of action:-
(a) Attention is drawn to the provisions of law contained in Order I and II of the Civil Procedure Code relating to non-joinder of parties and mis-joinder of causes of action and parties and as to representative suits:-
(i) Joinder of parties:- Order I, rule 1 and 3 provide in what case several plaintiffs or defendants may be joined in one suit.
(ii) Representative Suits:-Order I, rule 8 provides that when there are numerous persons having the same interest in one suit, one or more of such persons may sue or defend on behalf of all with the per- mission of the Court.
(iii) Objections as to non-joinder or mis-joinder:- Order I, rule 9 lays down that no suit shall be defeated by reason of mis-joinder or non- joinder of parties and Order I, rule 13 and Order II, rule 7 lay down that objections as to non-joinder or mis-joinder of parties or causes of action, etc., should be made at the earliest stage of the case.
(iv) Joinder of cause of action:- Order II, rules 3-5 provide in what cases several causes of action may be joined in one suit.
When an objection duly taken with regard to mis-joinder of causes of action is allowed by the Court the plaintiff should be permitted to select the cause of action with which he will
proceed and the Court should grant him time to amend the plaint by striking out the remaining causes of action. The Court should also give the plaintiff time within which to submit amended plaints for the remaining causes of action and for making up the Court fee that may be necessary. (Order II, Rule 8, Civil Procedure Code).
(v) Separate trial:- Order I, rule 2 and Order II, rule 6 provide for power of the Court to order separate trials if the joinder of several plaintiffs or several causes of action is inconvenient.
(vi) Striking out and adding parties:- Order I, rule 10 gives power to the Court to strike out unnecessary parties and add necessary parties.
(b) Necessary parties:-Suits for inheritance, partition or declaration of right in order to effect a partition, contribution, redemption, foreclosure, administration of property, dissolution and winding up of a partnership, and the like, cannot be properly disposed
of unless all persons interested in the matter are before the Court. Therefore, in cases of this description, if it appears that any necessary parties, have not been joined, the plaintiff should be ordered to joint them.
4. Signing and verification:-The plaint must be signed by the plaintiff, or, if by reason of absence or other good cause the plaintiff is unable to sign it, by his duly authorised agent. It must also be signed by the plaintiff’s pleader (if any) and be verified by the plaintiff, or by some other person proved to the satisfaction of the Court to be acquainted with the facts of the case.
The personal attendance of the plaintiff in Court for the purpose of verification is un- necessary. The verification must, however, be signed by the person making it.
5. Jurisdiction:- The jurisdiction of a Court depends upon the nature and value of the suit. (For detailed instructions see Chapter II on “Jurisdiction of Courts” and Chapter III on “Valuation of Suits “). If a suit is not within the jurisdiction of the Court, the plaint must be
returned in the presence of the Presiding Officer for presentation to proper Court. In such cases the presiding Officer must record on the plaint his reasons for returning it along with the other particulars mentioned in sub-rule (2) of Rule 10 of Order VII.
6. Rejection of plaint:- If the plaint discloses no cause of action, or is barred by any law on the statements made therein, or if the relief claimed is under-valued or the plaint is not sufficiently stamped and the plaintiff fails to correct the valuation or pay the deficiency in the Court-fee within the time fixed by the Court the plaint should be ‘rejected’ under Order VII, Rule 11 reasons being recorded by the Presiding Officer in support of the order.
It should be noted that the correct order in such cases is to ‘reject the plaint’ and not ‘dismiss the suit’. The rejection of a plaint does not preclude the institution of a fresh suit on the same cause of action, provided of course, it is not otherwise barred (e.g. by
limitation, etc.) by that time.
7. Comparison of copies of account:- Copies of any shop book or account produced should be compared with the original by Chief Ministerial Officer of the Court and the shop book or account should then be returned after marking the entries relied upon (Order VII, Rule 17).
When a shop book or other account written in a language other than English or the language of the Court is produced with a translation or transliteration of the relevant entry, the party producing it shall not be required to present a separate affidavit as to the correctness of the translation or transliteration but shall add a certificate on the document itself, that it is a full and true translation or transliteration of the original entry, and no
examination or comparison by the ministerial officer shall be required except by a special order of the Court.

8. Address of the parties:- The proceeding containing address for service is intended to facilitate the service of processes throughout the litigation (including appeals, etc.) and it is, therefore, important to see that it is duly filed at the outset according to this rule. Failure to comply with the rule is liable to be punished with dismissal of the suit but such an order may properly be passed in extreme cases when the failure is intentional and contumacious.

9. Land Suits:- If the plaint relates to agricultural land and the plaintiff is illiterate, it should be scrutinised with special care, according to the following directions:-
(i) The Presiding Officer shall ascertain by careful examination of the plaintiff or his agent, whether the prayer in the plaint corresponds in all particulars with the exact relief which the plaintiff orally describes himself as seeking. If the oral statements of the plaintiff or his agent are at variance with the written description of his claim, the plaint shall, in his or his
agent’s presence, be returned for amendment, and no amended plaint should be accepted until the Court is satisfied that it correctly expresses the claim which the plaintiff desires
to establish.
(ii) Every such plaint shall be accompanied by a statement, in the prescribed form setting forth the particulars relating thereto recorded in the Settlement record and in the last Jamabandi. This statement shall be verified by a signature of the Patwari of the Circle in which the land concerned is situate. Where by reason of partition, river action or other cause, the entries in the Settlement record and in the last Jamabandi do not accord, a brief explanation of the reason should be given in the column of remarks. Where the suit is for a specific plot with definite boundaries, it shall also be accompanied by a map, drawn to scale, showing clearly the specific plot claimed, or in relation to which the decree is to be made and so much of the fields adjoining it, also drawn to scale, as may be sufficient to facilitate identification. The specific plot and adjoining fields shall be numbered in accordance with the statement and the map shall be certified as correct by the Patwari or other person who prepared it. Where, however, the suit is for the whole of one or
more khasra numbers as shown in the Settlement map, or a share in such numbers, and not for a specific portion thereof no map will be required unless it is necessary for other reasons to show the boundaries of such khasra numbers.
10. Suits for recovery of money, mesne profits and accounts:- If the plaintiff seeks the recovery of money, the plaint should state the precise amount, as far as the case admits. In a suit for mesne profits or unsettled accounts it is sufficient to state the amount
approximately.
11. Suits by or against firms:-Suits by or against firms should be in the form prescribed in Order XXX. An explanation has been added by the High Court to Rule I of Order XXX, making it applicable to joint Hindu trading partnerships. (Notification No. 2212-G., dated 12th May, 1909).
12. Copies or concise statements of plaints:- When the plaint is admitted (after such amendment as may be found necessary), the plaintiff should be required to give as many copies of the plaint on plain paper as there are defendants, for being supplied to them. If
the plaint is long, or the number of defendants is large, the Court may permit concise statements of the plaint to be supplied instead. Such copies or concise statements must be examined by the chief ministerial officer and signed, if found correct (Order VII, Rule 9).
13. Parcha Yaddasht.:- When a plaint or petition is admitted and a date fixed for summoning of the other party or for any other purpose a memorandum (parcha yaddasht) on strong paper in the form given below duly filled in shall be given to the plaintiff or the petitioner or his agent if he is illiterate and not represented by counsel.

Form of Parcha Yaddasht.
IN THE COURT OF THE________________________AT Court____________
HOURS FROM _______________AM____________TO _________________
PM (Suit ____________) Civil Appeal________) No. ______________of 19

(Miscellaneous Application)

Instructions

1. In the case of parties who are illiterate and un- accompanied by counsel a parcha is to be given without demand (1) to the person who presents the plaint, appeal or petition and (2) when a case is not disposed of at the first hearing, to the defendant, or, if there be
serveral, to such defendants or respondents as the Court may direct.

2. Every entry in any column after the first entry is to be signed by the officer making it.

14. Parcha Yaddasht:-A similar parcha shall be given to the opposite party when he appears if he is illiterate and not represented by counsel.
15. Filling in of the Parcha:- Parcha shall he filled in and signed by the Reader of the Court and given to the parties concerned in the presence of the Presiding Officer as soon as the date of hearing is fixed.
In Small Cause Courts and in the Courts of the District Judges this parcha may be filled in by any other official if the Presiding Officer so directs.
16. Filling in of the Parcha:- The above parcha shall be used throughout the proceedings and properly filled in whenever the case is adjourned. If the parcha is lost a duplicate should be given.

District court

Due Date

Corporate Insolvency Resolution Process

As a result, the focal point of the IBC is the default of a payment obligation. The Insolvency and Bankruptcy Code, 2016 lays down the provisions for conducting insolvency or bankruptcy of individuals, partnership firms, LLP and companies. However, the process of insolvency and liquidation of corporate debtors under the Insolvency and Bankruptcy Code applies where the minimum default amount is Rs.1 crore only.

Creditors Under The Insolvency and Bankruptcy Code

When a company or LLP becomes insolvent or commits a default, the financial creditor, operational creditor or the corporate debtor can file an application to initiate the Corporate Insolvency Resolution Process by the Adjudicating Authority, i.e. National Company Law Tribunal.

A financial creditor is a person to whom the business owes a financial debt and includes a person to whom such debt is legally transmitted or assigned. A financial debt means a debt along with interest disbursed against the consideration for the value of money and includes-

• The amount borrowed against the payment of interest.
• The amount raised by acceptance under the acceptance credit facility or its dematerialized equivalent.
• The amount raised under the note purchase facility or the issue of notes, bonds, loan stock, debentures or any other similar instrument.
• The amount of the liability relating to a lease or hire purchase contract that is deemed as capital or finance lease under the Indian Accounting Standards or such other accounting standards.
• Receivables discounted or sold other than the receivables sold on a non-recourse basis.
• The amount raised under any other transaction, including any purchase agreement or forward sale having the commercial effect of a borrowing.
• Any derivative transaction entered in connection with benefit from or protection against fluctuation in any price or rate.
• Any counter-indemnity obligation relating to a bond, indemnity, guarantee, documentary letter of credit or other instrument issued by a financial institution or bank.
• The amount of liability relating to any of the indemnity or guarantee for any of the points mentioned above.

An operational creditor is a person to whom the business owes an operational debt and includes persons to whom such amount has been legally transferred or assigned for services or goods given by them. An operational debt means a claim relating to the provision of services or goods, including debt or employment regarding payment of dues arising under any law in force and payable to the Central Government, State Government or local authority.

Process of Corporate Insolvency Resolution

The conduct of the Corporate Insolvency Resolution Process of a corporate debtor is provided in Part II of the Insolvency and Bankruptcy Code, which are as follows-

Initiation of Corporate Insolvency Resolution Process

• The financial creditor can initiate the Corporate Insolvency Resolution Process against the corporate debtor by applying to NCLT. The operational creditor should first give a demand notice of an unpaid invoice to the corporate debtor demanding the default payment amount. When the operational creditor does not receive payment from the corporate debtor after the expiry of ten days of delivery of the demand notice or invoice demanding payment, he can apply to NCLT for initiating the Corporate Insolvency Resolution Process.
• A partner or member of the corporate debtor authorized to initiate Corporate Insolvency Resolution Process or a person in charge of managing the affairs or who has control and supervision over the financial affairs of the corporate debtor can initiate the Corporate Insolvency Resolution Process with NCLT.
• NCLT will pass an order within fourteen days of either admitting or denying the CIRP application. The Corporate Insolvency Resolution Process will commence from the admission date of the application by NCLT. The CIRP completion period is 180 days from the admission date of the CIRP application.

Declaration of Moratorium and Public Announcement

After the admission of the Corporate Insolvency Resolution Process application, NCLT will pass an order-

• • • Declaring a moratorium for prohibiting certain actions and transactions.
    • Causing a public announcement of initiating the Corporate Insolvency Resolution Process and call for the submission of claims.
    • Appointing an interim resolution professional.

NCLT orders on the Corporate Insolvency Resolution Process commencement date declaring the moratorium for prohibiting the following-

• • • Continuation or institution of suits or proceedings against the corporate debtor.
    • Encumbering, transferring, disposing of or alienating by the corporate debtor of its assets or beneficial interest or legal right.
    • Any action to recover, foreclose or enforce any security interest created by the corporate debtor relating to its property, including any action under the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002.
    • Recovery of any property by a lessor or owner, where the property is in possession or occupied by the corporate debtor.

The public announcement of the Corporate Insolvency Resolution Process should contain the following information-

• • • Name and address of the corporate debtor.
    • Name of the authority under which the corporate debtor is registered or incorporated.
    • Last date for submission of claims.
    • Details of the interim resolution professional who will be responsible for receiving claims and take over the management of the corporate debtor.
    • Penalties for misleading or false claims.
    • The date of closure of the Corporate Insolvency Resolution Process, i.e. 180th day from the admission date of the CIRP application.

The interim resolution professional appointed will have the following powers relating to the corporate debtor from the date of his appointment-

• • • Management of the affairs of the corporate debtor.
    • Exercise the powers of the board of directors or partners of the corporate debtor and suspension of the powers of the director or partner of the corporate debtor.
    • Officers and managers of the corporate debtor will have to report to the interim resolution professional and give access to the records and documents of the corporate debtor.
    • Financial institutions having and maintaining accounts of the corporate debtor will act on the instructions of the interim resolution professional and furnish all available information relating to the corporate debtor.

Committee of Creditors

The interim resolution professional will constitute a committee of creditors after collating all received claims against the corporate debtor and determining its financial position. The committee of creditors will consist of all the financial creditors of the corporate debtor.

The committee of creditors should hold the first meeting within seven days of the constitution of the committee. The committee of creditors in their first meeting should decide to either appoint or replace the interim resolution professional through a majority vote of not less than 66% of the voting share of the financial creditors.

Appointment of Resolution Professional

When the committee of creditors decide to continue with the interim resolution professional appointed by NCLT as the resolution professional, it should communicate its decisions to NCLT, the interim resolution professional and the corporate debtor. When the committee of creditors decides to replace the interim resolution professional, it should file an application to NCLT to appoint the proposed resolution professional along with his written consent. NCLT should forward the name of the proposed resolution professional submitted by the committee of creditors to the Insolvency and Bankruptcy Board of India for its confirmation. NCLT shall appoint the proposed resolution professional after receiving confirmation from the Board. The resolution professional will conduct the entire Corporate Insolvency Resolution Process and manage and control the operations of the corporate debtor during the CIRP.

Preparation of Information Memorandum

The resolution professional should prepare an information memorandum in the form and manner containing the relevant information as specified by the Board to formulate a resolution plan. A resolution applicant should submit a resolution plan prepared on the basis of the information memorandum to the resolution professional.

The resolution applicant is the person who submits a resolution plan either individually or jointly with any other person. The resolution professional will examine each resolution plan submitted to him for confirming that each resolution plan-

• Provides for the payment of the insolvency resolution process costs as specified by the Board prioritizing the payment of all other debts of the corporate debtor.
• Provides for the payment of debts of the operational creditors as specified by the Board.
• Provides for managing the affairs of the corporate debtor after approval of the resolution plan.
• Supervision and implementation of the resolution plan.
• It does not contradict the provisions of the law(s) in force.
• Confirms to such other requirements specified by the Board.

The resolution professional will present the resolution plan after its examination to the committee of creditors for its approval. The committee of creditors can approve the resolution plan by a vote of not less than 66% of the voting share of the financial creditors.

Approval of Resolution Plan

The resolution plan for the revival of the company or LLP should be approved within 180 days from the commencement of the CIRP by the creditors. However, NCLT can extend the period of 180 days by another 90 days.

NCLT will pass an order approving the resolution plan approved by the committee of creditors after being satisfied that the resolution plan meets the requirements of the IBC. NCLT order of approval of the resolution plan will be binding on the corporate debtor and its employees and members.

NCLT order of approval of the resolution plan will also be binding on the guarantors and stakeholders involved in the resolution plan and the creditors, including the Central or State Government or any local authority.

NCLT can pass an order to reject the resolution plan if it is satisfied that the resolution plan does not meet the requirements laid down under the IBC. When NCLT passes the order of rejection of the resolution plan, it will pass an order of the liquidation of the corporate debtor.

After the approval of the liquidation of the corporate debtor, the committee of creditors will appoint the liquidator to sell the corporate debtor’s assets and share them among the stakeholders. The distribution of the assets will be made as per the provisions of the IBC.

Q.1. When did the Insolvency and Bankruptcy Code 2016 receive the President’s assent:

A 5 August 2016
B 28 May 2016
C 5 May 2016
D 15 June 2016

Q.2. What is the applicability of IBC:

A Companies incorporated under the Companies Act, 2013 or under any previous
company law, Limited Liability Partnerships incorporated under Limited Liability
Partnership Act, 2008, Partnership firms and Individuals.
B Companies incorporated under the Companies Act, 2013 or under any previous
company law, Hindu Undivided Family, Partnership firms and Individuals.
C Companies incorporated under the Companies Act, 2013 or under any previous
company law, Limited Liability Partnerships incorporated under Limited Liability
Partnership Act, 2008 and Co-operative Societies registered under Co-operative
Societies Act, 1972.
D Companies incorporated under the Companies Act, 2013 or under any previous
company law, Trusts under the Indian Trusts Act, 1882, Co-operative Societies
registered under Co-operative Societies Act, 1972, Individuals.

Q.3. What is the impact of IBC on other legislation:
A IBC does not have any effect on other legislations.

B Other legislations shall have an overriding effect on IBC.
C IBC has an overriding effect on other legislations.
D IBC is an independent code.

Q.4. Which Legislations are getting repealed on enforcement of IBC:
A The Presidency Towns Insolvency Act 1909, Provincial Insolvency Act 1920 and Sick
Industrial Companies (Special Provisions) Act 1985.
B Sick Industrial Companies (Special Provisions) Act 1985, The Securitisation and
Reconstruction of Financial Assets and Enforcement of Security Interest Act 2002 and
The Payment and Settlement Systems Act 2007.
C Provincial Insolvency Act 1920, The Securitisation and Reconstruction of Financial
Assets and Enforcement of Security Interest Act 2002 and Recovery of Debts due to
Banks and Financial Institutions Act, 1993.
D Sick Industrial Companies (Special Provisions) Act 1985 and some provisions of
Negotiable Instruments Act, 1881.

Q.5. Who can initiate Corporate Insolvency Resolution Process (CIRP):
A Only Corporate Debtor
B Financial Creditor and Operational Creditor.
C Financial Creditor, Operational Creditor and Corporate Debtor.
D Corporate Debtor and Financial Creditor.

Q.6. When can CIRP be initiated:
A The minimum amount of default is Rupees Five Lakh or such higher amount which
shall not exceed Rupees Two Crore.
B The minimum amount of default is Rupees One Lakh or such higher amount which
shall not exceed Rupees One Crore.
C The minimum amount of default is Rupees Ten Lakh or such higher amount which
shall not exceed Rupees Three Crore.

D The minimum amount of default is Rupees Eight Lakh or such higher amount which
shall not exceed Rupees Three Crore.

Q.7. What constitutes default under IBC:
A Non-payment of debt when whole or any part or instalment of the amount of debt
has become due and payable and is not repaid by the debtor or the corporate debtor.
B Non-payment of debt when whole or part of the payment is demanded by the
financial or operational creditor.
C Non-payment of any amount, whether in full or in part, on demand by the creditors
or concerned authorities.
D Any payment of the creditor that is subsisting.

Q.8. What is debt under IBC:
A Any amount of money that is owed or due to any party.
B A liability or obligation in respect of a claim which is due from any person and
includes a financial debt and operational debt.
C Any liability arising in respect of money advanced by a creditor to the debtor.
D Debts arising out of loans advanced by a financial institution.

Q.9. Who is a Financial Creditor under IBC:
A Any person to whom a financial debt is owed and includes a person to whom such
debt has been legally assigned or transferred to.
B Any person that has a claim on the services of a second party.
C Any person to whom a financial debt is owed.
D Any person who owes financial debt to another.

Q.10. Which of the following is not a financial debt:
A Any amount raised by acceptance under any acceptance credit facility or its dematerialised equivalent.

B Receivables sold or discounted other than any receivables sold on non-recourse basis.
C Contract to pay rent for the use of plant, property or equipment.
D Any amount raised pursuant to any note purchase facility or the issue of bonds,
notes, debentures, loan stock or any similar instrument.

Q.11. Who is an ‘Operational Creditor’ under IBC:
A A creditor whose liability subsists upto 6 months and is listed in the balance sheet.
B A person to whom an operational debt is owed and includes any person to whom
such debt has been legally assigned or transferred.
C Any creditor listed in the balance sheet of the corporate debtor.
D Any person that has advanced loan to another party.

Q.12. Which of the following is not an operational debt:
A Deferred income tax
B Payment to be made to the supplier of the Company.
C Retirement benefits payable under pension plan
D Any amount raised under any other transaction, including any forward sale or
purchase agreement, having the commercial effect of a borrowing.

Q.13. Whether an operational creditor can assign or legally transfer any operational debt
to a financial creditor:
A Yes. However, the transferee shall be considered as an operational creditor to such
extent of transfer.
B Yes but the transferee shall be considered as a financial creditor in relation to such
transfer.
C No. An operational creditor cannot assign or legally transfer any operational debt to a
financial creditor.
D No. An operational creditor can assign or legally transfer an operational debt only to
an operational creditor.

Q.14. Does a financial creditor include a secured creditor:
A No, a financial creditor does not include a secured creditor.
B Yes, a financial creditor includes a secured creditor.
C Yes, a financial creditor includes a secured creditor but he shall not exercise the rights
of a secured creditor.
D No, a financial creditor does not include a secured creditor but he is entrusted with
the rights of a secured creditor.

Q.15. Which of the following statement relating to operational creditors is true:
A All unsecured creditors are operational creditors but all operational creditors are not
unsecured creditors.
B All unsecured creditors are not operational creditors but all operational creditors are
unsecured creditors.
C Unsecured creditors have no relation with operational creditors.
D Unsecured creditors and operational creditors are the same in this Code.

Q.16. Which of the following statement relating to workmen/employees is true:
A Workmen and employees whose past payments are due come under the definition of
operational creditor.
B Workmen and employees whose past payments are due do not come under the
definition of operational creditor.
C Workmen and employees whose past payments are due are independent and do not
have any relationship with operational creditor.
D Workmen and employees whose past payments are due will come under the
definition of operational creditor, only if the operational creditors give prior approval
of the same.

Q.17. Who is a corporate debtor under IBC:
A Any person that owes debt to a company.

B A company that owes debt to any person.
C A corporate person who owes a debt to any person.
D An entity that owes money to a financial institution.

Q.18. Who are considered corporate persons under the provisions of IBC:
A Companies and Limited Liability Partnerships.
B Companies and Unlimited Liability Partnership firms.
C Companies, Limited Liability Partnerships and Trusts.
D Companies, Unlimited Liability Partnership firms and Societies.

Q.19. Who is ‘financial service provider’ in IBC:
A A person engaged in the business of providing financial services in terms of
authorisation issued or registration granted by a financial sector regulator.
B A person engaged in the business of providing all kinds of financial services.
C A person engaged in any kind of business where the authorisation is issued or
registration is granted by a financial sector regulator.
D A person engaged in the business of providing all kinds of financial as well as
operational services.

Q.20. Which of the following is not a financial service:
A Accepting of deposits
B Effecting contracts of insurance
C Payment of wages to employees
D Establishing or operating an investment scheme

Q.21. Which of the following statement relating to financial service provider is correct:
A Financial service provider cannot initiate CIRP nor can any CIRP be initiated against it.
B Financial service provider can initiate CIRP and also CIRP can be initiated against it.

C Financial service provider cannot initiate CIRP but CIRP can be initiated against it.
D Financial service provider can initiate CIRP but CIRP cannot be initiated against it.

Q.22. Whether IBC is applicable to person resident outside India:
A No, IBC is not applicable to a person resident outside India.
B Yes, IBC is applicable to a person resident outside India.
C IBC is applicable to a person outside India with the prior approval of the Board.
D IBC is applicable to person resident outside India as well as to foreign persons.

Q.23. Who is the Regulator under IBC:
A Reserve Bank of India.
B INSOL India.
C Insolvency and Bankruptcy Board of India.
D Indian Board for Insolvency and Bankruptcy.

Q.24. Which among the following is not entitled to initiate CIRP:
A A corporate debtor in respect of whom a liquidation order has been made.
B A corporate debtor that has not gone through a corporate insolvency resolution
process.
C A financial creditor.
D An operational creditor.

Q.25. Which statement regarding Information Utility is correct:
A Information Utility shall collect, collate and disseminate financial information to
facilitate insolvency resolution.
B Information Utility shall register the debtors and creditors as insolvency professionals
and act as a storehouse of their information.
C Information Utility shall accept applications of corporate insolvency.

D Information utility shall store information of all insolvency and bankruptcy cases.

Q.26. From whom does Information Utility get information of assets in which security
interest is created:
A Financial Creditor and Operational Creditor
B Corporate Debtor may provide information.
C Insolvency Professionals
D Insolvency Professionals Agencies

Q.27. What is initiation date in CIRP:
A The date on which a financial creditor, corporate applicant or operational creditor
makes an application to the Adjudicating Authority for initiating corporate insolvency
resolution process.
B The date of admission of an application by a financial creditor, corporate applicant or
operational creditor for initiating corporate insolvency resolution process by the
Adjudicating Authority.
C The date on which a financial creditor, corporate applicant or operational creditor
realises the insolvent status of the corporate debtor.
D The date on which the corporate debtor is unable to pay its debts to the creditors.

Q.28. What is insolvency commencement date:
A The date on which a financial creditor, corporate applicant or operational creditor
makes an application to the Adjudicating Authority for initiating corporate insolvency
resolution process.
B The date of admission of an application by a financial creditor, corporate applicant or
operational creditor for initiating corporate insolvency resolution process by the
Adjudicating Authority.
C The date on which a financial creditor, corporate applicant or operational creditor
realises the insolvent status of the corporate debtor.
D The date on which the corporate debtor is unable to pay its debts to the creditors.

Q.29. What is resolution plan:
A A plan proposed by the financial or operational creditor for insolvency resolution of
the corporate debtor as a going concern.
B A plan proposed by the Adjudicating Authority creditor for insolvency resolution of
the corporate debtor as a going concern.
C A plan proposed by any person for insolvency resolution of the corporate debtor as a
going concern.
D A plan proposed by the corporate debtor themselves for insolvency resolution of the
corporate debtor as a going concern.

Q.30. Who approves the resolution plan:
A Committee of creditors.
B Insolvency Professional.
C Adjudicating Authority.
D Insolvency and Bankruptcy Board of India.

Q.31. What is the voting requirement for approval of resolution plan by creditors:
A 85 percent of voting shares
B 60 percent of voting shares
C 75 percent of voting shares
D 90 percent of voting shares

Q.32. Which of the following does not form the content of resolution plan:
A Provides for the management of the affairs of the Corporate debtor after approval of
the resolution plan.
B Provides for the payment of insolvency resolution process costs in a manner specified
by the Board in priority to the repayment of other debts of the corporate debtor
C The implementation and supervision of the resolution plan

D Provisions that are in contravention of any of the provisions of the law for the time
being in force.

Q.33. Who constitutes the committee of creditors:
A Insolvency professional.
B Financial or operational creditor.
C Interim resolution professional.
D Adjudicating Authority.

Q.34. Who shall receive the notice of meeting of committee of creditors:
A Only the members of committee of creditors.
B Members of committee of creditors, members of suspended Board of Directors and
operational creditors in case their aggregate dues is not less than ten percent of debt.
C Members of the committee of creditors, operational creditors in case their aggregate
dues is not less than ten percent of debt and special invitees.
D Members of the committee of creditors and special invitees.

Q.35. When is it required to send a notice to operational creditor:
A all operational creditors.
B when their aggregate due is not less than twenty percent of the paid up share capital
of the corporate debtor.
C when their aggregate due is not less than ten percent of the debt.
D Notice is not sent to operational creditors at all.

Q.36. What is the time limit within which the first meeting of committee of creditors
should be held:
A Within 14 days of constitution of committee.
B Within 7 days of constitution of committee.
C Within 10 days of constitution of committee.

D As per the discretion of the committee.

Q.37. Which of the following agenda items should be taken up in the first meeting of
committee of creditors:
A Appointment of interim resolution professional as insolvency professional or to
replacement of the interim resolution professional by another resolution
professional.
B Preparation of draft resolution plan.
C Discussion of the status of the corporate debtor as on the present date and the road
map ahead.
D Collection of information on corporate debtor from independent sources.

Q.38. Who is a resolution professional:
A Independent person appointed by the High Court to conduct corporate insolvency
resolution process.
B Insolvency professional appointed to conduct corporate insolvency resolution
process.
C Independent person appointed by the applicant to conduct corporate insolvency
resolution process.
D any person qualified to be appointed as a resolution professional and who has
submitted an application to the Board to undertake corporate insolvency resolution
process.

Q.39. What is the term of appointment of interim resolution professional:
A 30 days from the date of his appointment.
B 14 days from the date of his appointment.
C 20 days from the date of his appointment.
D 10 days from the date of his appointment.

Q.40. Which of the following activities cannot be undertaken by an interim resolution
professional:
A To appoint accountants, legal or other professionals.
B To issue instructions to personnel of the corporate debtor for keeping the corporate
debtor as a going concern.
C To enter into contracts on behalf of the corporate debtor.
D To undertake liquidation proceedings of the corporate debtor.

Q.41. Which of the following statement regarding appointment of insolvency
professional is true:
A Any creditor who is a member of the committee of creditors may appoint an
insolvency professional other than the resolution professional to represent such
creditor in a meeting of the committee of creditors.
B Any creditor who is a member of the committee of creditors may appoint an
insolvency professional other than the resolution professional to represent such
creditor provided 75% of the members of committee of creditors agree to it.
C No creditor who is a member of the committee of creditors can appoint an insolvency
professional other than the resolution professional to represent such creditor.
D Any creditor who is a member of the committee of creditors may appoint an
insolvency professional other than the resolution professional to represent such
creditor with the previous permission of the Insolvency and Bankruptcy Board of
India.

Q.42. Which of the following statements regarding operational creditors is correct:
A Operational creditors can attend and vote at meetings of committee of creditors.
B Operational creditors can neither attend nor vote at meetings of committee of
creditors.
C Operational creditors can attend but cannot vote at meetings of committee of
creditors.
D Operational creditors can attend but can vote only with prior approval of the
committee of creditors.

Q.43. Which of the following statements relating to a director or KMP of corporate
debtor who has given loan to corporate debtor is correct:
A Such a director shall have right of representation, participation and voting in a
meeting of committee of creditors.

B Such a director shall not have the right of representation but can participate and vote
in a meeting of committee of creditors.
C Such a director shall not have any right of representation, participation and voting in
a meeting of committee of creditors.
D Such a director shall have the right of representation and participation but cannot
vote in a meeting of committee of creditors.

Q.44. When the financial creditor is related to corporate debtor is there any restriction
with respect to his representation at the meeting of committee of creditors or voting:
A The related financial creditor shall be restricted with respect to his participation,
voting and representation at the meeting of committee of creditors and voting.
B The related financial creditor shall not be restricted with respect to his representation
at the meeting of committee of creditors and voting.
C The related financial creditor can participate and vote at the meeting of committee of
creditors but without any representation.
D The related financial creditor can participate but not vote at the meeting of
committee of creditors by representation.

Q.45. Which of the following is not a related party in relation to corporate debtor:
A A director or partner of the corporate debtor.
B A key managerial personnel of the corporate debtor.
C Any person or entity that is materially related to the company .
D Relatives of a director or partner or key managerial personnel of the corporate
debtor.

Q.46. What is the time limit for an operational creditor to initiate insolvency resolution
process from the date of delivering of notice or invoice demanding payment:
A 7 days
B 10 days
C 14 days
D 12 days

Q.47. Which of the following does not constitute as evidence of default by the
operational creditors:
A copy of invoice or demand notice.
B a contract for the supply of goods and services with corporate debtor.
C bank statement.
D financial accounts.

Q.48. What is the time limit for completion of insolvency resolution process:
A 180 days from the date of appointment of resolution professional.
B 180 days from the date of default by the corporate debtor.
C 180 days from the date of submission of application for insolvency.
D 180 days from the date of admission of the application.

Q.49. How much is the extension period for completion of insolvency resolution process:
A 90 days.
B 180 days.
C 120 days.
D 150 days.

Q.50. Who shall declare a moratorium:
A Insolvency Professional
B Insolvency Professional Agency
C Adjudicating Authority
D Insolvency and Bankruptcy Board of India

Q.51. Which of the following activities shall not be prohibited or terminated during the
moratorium period:
A Transferring, encumbering, alienating or disposing of any assets by the corporate
debtor.
B The recovery of any property by an owner or lessor where such property is occupied
by or in the possession of the corporate debtor.

C any action to foreclose, recover or enforce any security interest created by
the corporate debtor.
D The supply of essential goods or services to the corporate debtor.

Q.52. Which of the following actions does not require the prior approval of the
committee of creditors:
A Appoint accountants, legal or other professionals for the corporate debtor.
B Create any security interest over the assets of the corporate debtor.
C Record any change in the ownership interest of the corporate debtor.
D Make any change in the management of the corporate debtor or its subsidiary.

Q.53. Who is an applicant under Section 7 of IBC:
A Corporate Debtor.
B Financial Creditor.
C Operational Creditor.
D Adjudicating Authority

Documents Required for Financial Creditor

The prescribed documents are to be submitted along with the application form.

• A record of the default recorded with the information utility or such other document or evidence of default.
• The name of the resolution professional proposed to act as an interim resolution professional.
• Any other information as may be specified by the board.

Documents Required for Operational Creditor

The following documents are to be furnished at the time of making the application form.

• A copy of invoice demanding payment or demand notice delivered by the operational creditor to the corporate debtor.
• An affidavit stating that there is no notice given by the corporate debtor describing to a dispute of the outstanding operational debt.
• A copy of the certification from the financial institutions maintaining accounts of the operational creditor confirming that there is no payment of an unpaid operational debt by the corporate debtor, if available.
• A copy of any report with information utility confirming that there is no payment of an unpaid operational debt by the corporate debtor, if available.
• Any other proof is confirming that there is no payment of an unpaid operational debt by the corporate debtor or such additional information, as may be prescribed by the central government.

Documents Required for Corporate Debtor

The following documents are to be furnished at the time of making the application form.

• The information is representing its books of account and such other documents for such period as may be specified by the Board.
• The information representing the resolution professional proposed to appointed as an interim resolution professional.
• The special resolution is given by shareholders of the corporate debtor or the resolution adopted by at least three-fourths of the total number of partners of the corporate debtor, as the case may be, approving the filing of the application.

How to Apply for CIRP?

The following is the processes for resolution or liquidation of corporate which are as follows:

Step 1: Application To The NCLT A creditor of a corporate (financial or operational), or the company, can request to the National Company Law Tribunal. It is used to admit that the company enters the Corporate Insolvency Resolution Process. For this, creditors must show the failure of payment of a debt which is more than one Lakh rupees, and the NCLT has to pass an order either admitting or denying the application within 14 days.

The financial and an operational creditor have to satisfy separate requirements when making their requests before the NCLT. A financial creditor needs to furnish the report of the default. The Insolvency and Bankruptcy Code, 2016 creates a new class of record keepers known as Information Utilities.

Then the operational creditor needs first to make a demand for his unpaid debt. By an ongoing dispute, it is open to the corporate debtor to defend the claim.

Step 2: Appointment of Interim insolvency Resolution Professional When a corporate debtor is accepted into the CIRP (Corporate Insolvency Resolution Process), it checks the board of directors. Further, the management is placed under an independent “interim resolution professional”. From this and till the end of the CIRP (Corporate Insolvency Resolution Process), the management ceases to have any control over the activities of the company.

Step 3: MoratoriumMoreover, a moratorium takes part which prohibits the following:

• Continuing or beginning of any legal matters on the corporate debtor
• Transfer of its assets
• Execution of security interest
• Recovery of property as an owner
• Discontinuing or termination of the supply of basic goods and services, the moratorium lasts till the corporate debtor is in CIRP process.

Step 4: Verification and analysis of claimsNow, the interim resolution professional will summon, verify claims made by the corporate debtor’s creditors also, list them. After that, in 30 days of the acceptance into CIRP (Corporate Insolvency Resolution Process), from the COC (Committee of Creditors), comprising all the financial creditors of the corporate debtor.

Step 5: Appointment of the resolution professional The COC (Committee of Creditors) appoints an independent person to operate as the “resolution professional” for the remainder of the CIRP (Corporate Insolvency Resolution Process). The resolution professional will be the same person or the same person as the interim resolution professional depending upon COC.

Step 6: Acceptance of the Resolution Plan A resolution plan for the restructuring of the corporate must be approved within 180 days from the commencement of  CIRP by creditors.

All person, management, the creditors, or a third party can propose such a resolution plan. It is the duly of resolution professional to check that the plan satisfies the criteria set up in the Insolvency and Bankruptcy Code, 2016.

If a plan is accepted within this period and is sanctioned by the NCLT

The approval of the resolution plan when it meets the conditions binding on the corporate debtor and its employees, members, creditors, guarantors and other stakeholder involved in the resolution plan. The resolution professional is required to obtain necessary approvals required under any law for the time being n force within one-year from the date of approval by adjudicating authority.

If no resolution plan is accepted in this period

If the resolution plan is claimed, then NCLT is obliged to order the liquidation of the corporate debtor. Upon approval of liquidation, COC appoints the liquidator to sell the assets of the corporate debtor and share them among the stakeholders.

Insolvency and Bankruptcy Board of India
Frequently Asked Questions (FAQs) on Corporate Insolvency Resolution Process

Q1. What are the objectives of the Insolvency and Bankruptcy Code, 2016 (Code)?
Ans: The Code consolidates and amends the laws relating to reorganisation and insolvency
resolution of corporate persons, partnership firms and individuals in a time bound
manner for maximization of value of assets of such persons, to promote entrepreneurship,
availability of credit and balance the interests of all the stakeholders.

Q2. What is corporate insolvency?
Ans: Corporate insolvency is a state where a corporate person fails to pay debt, whether whole or any part or instalment, when due and payable.

Q3. Who is a corporate person?
Ans: A corporate person means:
a) a company as defined under the Companies Act, 2013;
b) a Limited Liability Partnership as defined under the Limited Liability Partnership Act, 2008; or
c) any other person incorporated with limited liability under any law. It does not include any Financial Service Provider. However, Financial Service Provider could be notified for the purpose of their insolvency and liquidation proceedings, under section 227 of the Code.

Q4. Who is a corporate debtor?
Ans: A corporate debtor is a corporate person who owes a debt to any person.

Q5. What is corporate insolvency resolution process (CIRP)?
Ans: CIRP is the process of resolving the corporate insolvency of a corporate debtor in accordance with the provisions of the Code.

Q6. Who can initiate CIRP?
Ans: CIRP may be initiated by a financial creditor under section 7, an operational creditor under section 9 and corporate applicant of corporate debtor under section 10 of the Code.

Q7. What is the minimum default amount for initiating CIRP against a corporate debtor?
Ans: The minimum amount of default for initiating CIRP was ₹ 1 lakh till recently. The
Government vide notification dated 24th March, 2020, has increased the minimum amount of default to ₹ 1 crore.

Q8. Who is a Financial Creditor?
Ans: Any person to whom a financial debt is owed and includes a person to whom such debt has been legally assigned or transferred to.

Q9. What is Financial Debt?
Ans: It means a debt along with interest, if any, disbursed against consideration of time value of money. It also includes those enumerated in section 5(8)(a) to (i) of the Code, such as money borrowed against the payment of interest, amount of any liability in respect of any lease or hire purchase contract, any amount raised for a transaction having commercial effect of borrowing such as amount raised from allottee under a real estate project etc.

Q10. Who is an Operational Creditor?
Ans: Any person to whom an operational debt is owed and includes any person to whom such debt has been legally assigned or transferred.

Q11. What is Operational Debt?
Ans: It means claim arising in relation to supply of goods and services. It also includes claims in relation to employment or dues payable to Central Government, State Government or any local authority.

Q12. Who is a Corporate Applicant?
Ans: Corporate Applicant means:
a) corporate debtor;
b) a member or partner of the corporate debtor who is authorised to make an application for the CIRP under its constitutional document or
c) an individual who is in charge of managing the operations and resources of the corporate
debtor; or
d) a person who has the control and supervision over the financial affairs of the corporate debtor.

Q13. Which court/tribunal has the jurisdiction to hear an application for CIRP?
Ans: National Company Law Tribunal, having territorial jurisdiction over the place where the
registered office of the corporate person is located serves as the Adjudicating Authority, in relation to insolvency resolution and liquidation for corporate persons.

Q14. What documents are required to be submitted by a Financial Creditor along with the
application for CIRP?
Ans: The documents to be submitted by a financial creditor along with the application as stated in section 7(3) of the Code and rule 4 of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016, inter-alia, include, record of default recorded with information utility or other record or evidence of default as specified and the name of the proposed interim resolution professional.

Q15. What documents are required to be submitted by an Operational Creditor along with
the application for CIRP?
Ans: The documents to be submitted by an operational creditor along with the application as stated in section 9(3) of the Code and rule 6 of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016 interalia, include a copy of the invoice demanding payment or demand notice delivered by the operational creditor, affidavit stating that no dispute of the debt has been raised by the corporate debtor and a copy of certificate from financial institution, record with information utility or any other proof, confirming that there is no payment of unpaid debt.

Q16. Is there a specific form/format for the demand notice/ invoice demanding payment to
be sent to corporate debtor under section 8?
Ans: Yes. As per rule 5 of Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016, the demand notice needs to be furnished to the corporate debtor in Form 3 or copy of an invoice attached with a notice in Form 4.

Q17. Can a corporate debtor undergoing CIRP file an application for initiating CIRP against
its own debtors?
Ans: Yes, a corporate debtor undergoing CIRP can do so in terms of section 11 of the Code.

Q18. What documents are required to be submitted by a corporate debtor / corporate
applicant along with the application for CIRP?
Ans: The documents to be submitted by a corporate debtor along with the application, as stated in section 10(3) of the Code and rule 7 of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016 , inter alia, include information relating to its books of account, name of the proposed interim resolution professional and 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 application.

Q19. Is there a form/format for the application to be filed before the Adjudicating
Authority?
Ans: Yes. The form of application to be filed by the financial creditor, operational creditor and corporate debtor are provided under Form 1, Form 5 and Form 6 respectively of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016.

Q20. Can a corporate debtor undergoing liquidation, file an application for initiation of
CIRP on itself?
Ans: No.

Q21. What is time limit within which the CIRP should be completed?
Ans: As per section 12(1) of the Code, the CIRP shall be completed within a period of 180 days from the date of admission of the application to initiate such process. The Adjudicating Authority may grant a one-time extension of 90 days. The maximum time within which CIRP has to be mandatorily completed, including any extension or litigation period, is 330 days.

Q22. What is the procedure to extend the time period beyond one hundred and eighty days?
Ans: The committee of creditors is required to pass a resolution, with sixty-six percent of the total voting share, to extend the CIRP. Thereafter, the resolution professional needs to file an application to the Adjudicating Authority seeking approval for such extension.

Q23. Can a CIRP once initiated be withdrawn?
Ans: Yes. It can be withdrawn either before admission by the Adjudicating Authority or even after admission. The Adjudicating Authority may allow withdrawal of application admitted under section 7 or section 9 or section 10, on an application made by the applicant through the resolution professional, with the approval of 90 percent of voting share of the committee of creditors. The application for withdrawal may also be made by the applicant through interim resolution professional even before the constitution of committee of creditors.

Q24. What does the Insolvency Resolution Process Costs include?
Ans: The Insolvency Resolution Process Costs is defined to mean those costs indicated in section (13) of the Code read with regulation 31 of Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016. It includes amount of any interim finance along with cost of raising such finance, fee and expenses of interim resolution professional or resolution professional ratified/approved by the committee of creditors, fee of the authorised representative representing class of creditor, cost incurred for running the corporate debtor as going concern, amount due to suppliers of essential goods and services etc.

Q25. Who will fix and bear the expenses/ cost incurred by the interim resolution
professional?
Ans: As per regulation 33 of Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016, the applicant is required to fix the expenses incurred or to be incurred by the interim resolution professional. In case, the expenses are not fixed by the applicant, the Adjudicating Authority shall fix the expenses. Such costs/expenses shall be borne by the applicant which shall be reimbursed by the committee of creditors to the extent ratified by it. Further, the amount of the expenses ratified by the committee of creditors shall form part of insolvency resolution process costs.

Q26. Who will fix and bear the expenses/ cost incurred by the resolution professional?
Ans: The committee of creditors shall fix the expenses to be incurred on or by the resolution professional and such expenses shall form part of insolvency resolution process costs.

Q27. How is an Interim Resolution Professional appointed in a CIRP?
Ans: The Adjudicating Authority appoints the insolvency professional proposed by the financial or operational creditor in their application, as the interim resolution professional on the insolvency commencement date. However, where the name of the insolvency professional is not proposed in the application filed by an operational creditor, the Adjudicating Authority makes a reference to the Board for the recommendation of an insolvency professional, who may act as an interim resolution professional. The Board within ten days of the receipt of a reference from the Adjudicating Authority, recommends the name of an Insolvency Professional to the Adjudicating Authority against whom no disciplinary proceedings are pending.

Q28. What is the term of an interim resolution professional?
Ans: The term of an interim resolution professional continues till the date of appointment of the resolution professional under section 22.

Q29. What is the first step to be taken by interim resolution professional after admission of
CIRP?
Ans: After admission of CIRP by the Adjudicating Authority, an interim resolution professional makes a public announcement in Form A within three days from his appointment and calls for submission of claims from the stakeholders.

Q30. What are the contents of a public announcement?
Ans: The public announcement contains information relating to (a) name and address of the corporate debtor, (b) name of authority where corporate debtor is incorporated/ registered, (c) last date for submission of claims, (d) details of interim resolution professional, (e) estimated date of closure of CIRP, (f) state where claim forms can be downloaded or obtained from, and (g) choice of three insolvency professionals identified to act as the authorised representative of creditors in each class etc.

Q31. Where is the public announcement made?
Ans: The public announcement is published in (a) one English and one regional language
newspaper, (b) on the website of corporate debtor, if any, and (c) on the website designated by the Board.

Q32. Is there any prescribed form for public announcement?
Ans: Yes, Form A to the Schedule to Insolvency and Bankruptcy Board of India (Insolvency
Resolution Process for Corporate Persons) Regulations, 2016.

Q33. Who bears the expenses of public announcement?
Ans: The applicant initiating CIRP bears the expenses of the public announcement which may be reimbursed to the extent ratified by the committee of creditors.

Q34. What does moratorium mean?
Ans: As per section 14(1) of the Code, an order of moratorium passed by the Adjudicating
Authority shall prohibit the following:
a) the institution of suits or continuation of pending suits or proceedings against the corporate debtor including execution of any judgement, decree, or order in any court of law, tribunal, arbitration panel or other authority.
b) transferring, encumbering, alienating, or disposing off by the corporate debtor any of its assets or any legal right or beneficial interest therein.
c) any action to foreclose, recover or enforce any security interest created by the corporate debtor in respect of its property including any action under the SARFAESI Act, 2002.
d) recovery of any property by an owner or lessor where such property is occupied by or in the possession of the corporate debtor.

Q35. Whether moratorium would apply to a guarantor of the corporate debtor?
Ans: As per section 14(3) of the Code, the order of moratorium shall not apply to a surety in a contract of guarantee to a corporate debtor. Consequently, actions or proceedings, if any, against a guarantor of the corporate debtor are not impacted by the order of moratorium.

Q36. What is the duration of moratorium?
Ans: The order of moratorium comes into force from the date of such order by the Adjudicating Authority till the completion of the CIRP. Further, if the Adjudicating Authority approves the resolution plan under section 31(1) or passes an order for liquidation of corporate debtor under section 33, the moratorium ceases to have effect from the date of such approval of resolution plan or liquidation order, as the case may be.

Q37. Can a license, permit, registration, quota, concession, clearance or similar grants or
rights stand suspended/terminated on grounds of insolvency?
Ans: No, such grants or rights given by the Central Government, State Government, local
authority, sectoral regulator or any other authority constituted under any other law for the time being in force, cannot be suspended or terminated on the grounds of insolvency. However, this is subject to the condition that there is no default in payment of current dues arising for their use or continuation during the moratorium period.

Q38. Can a supplier terminate or suspend supply of essential goods and services to the
corporate debtor during the moratorium period?
Ans: No, essential goods and services specified under regulation 32 of the Insolvency and
Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016, cannot be terminated or suspended during moratorium.

Q39. What constitutes essential goods and services as per the Code?
Ans: The essential goods and services specified are (a) electricity; (b) water; (c)
telecommunication services; and (d) information technology services, to the extent these are not a direct input to the output produced or supplied by the corporate debtor. For instance, water supplied to a corporate debtor will be essential supplies for drinking and sanitation purposes, but not for generation of hydroelectricity.

Q40. Will the supply of critical goods and services be terminated, suspended or interrupted
during the moratorium period?
Ans: Where the interim resolution professional or resolution professional, as the case may be, considers that supply of certain goods or services are critical to protect and preserve the value of the corporate debtor and manage the operations of corporate debtor as a going concern, then supply of such goods or services shall not be terminated, suspended or interrupted during the period of moratorium. However, this is subject to the condition that the corporate debtor makes payment for the supplies arising during the moratorium period.

Q41. Who will manage the corporate debtor after admission of CIRP?
Ans: Upon the appointment of the interim resolution professional, the affairs of the corporate debtor shall be managed by him. Thereafter, it shall be managed by the resolution professional upon his appointment.

Q42. What happens to the power of the board of directors or the partners of the corporate
debtor?
Ans: The powers of the board of directors or the partners of the corporate debtor as the case may be, shall stand suspended upon the appointment of the interim resolution professional. Such powers shall be exercised by the interim resolution professional and resolution professional, as the case may be.

Q43. To whom does an officer/manager of a corporate debtor report after commencement
of CIRP?
Ans: As per section 17(1)(c) of the Code, the officers and managers of the corporate debtor shall report to the interim resolution professional. Upon appointment of resolution professional, the resolution professional shall exercise the same powers and perform duties vested or conferred on interim resolution professional, in terms of section 23(2) of the Code.

Q44. Whether financial institutions of corporate debtor are bound by the instructions of
interim resolution professional or resolution professional?
Ans: As per section 17(1)(d) of the Code, the financial institutions maintaining the accounts of the corporate debtor are bound to act on the instructions of the interim resolution professional in relation to such accounts and are required to furnish information relating to the corporate debtor. The same powers are also available to a resolution professional after his appointment.

Q45. Who is required to perform the compliance obligations on behalf of the corporate
debtor?
Ans: During CIRP, the responsibility to comply with the requirements under any law on behalf of the corporate debtor lies with the interim resolution professional and resolution professional, as the case may be.

Q46. What are the forms prescribed for submission of claims by the stakeholders?
Ans: The Schedule to the Insolvency and Bankruptcy Board of India (Insolvency Resolution
Process for Corporate Persons) Regulations, 2016 provides various forms for filing of claims by different stakeholders which are as under:
S. No. Form Stakeholder category
1. Form B Operational Creditor
2. Form C Financial Creditor
3. Form CA Class of Creditors
4. Form D Workman or employee
5. Form E Authorised representative of workmen/employees
6. Form F Other Creditors

Q47. How is the committee of creditors constituted?
Ans: The interim resolution professional shall receive and collate all claims submitted by creditors pursuant to the public announcement and thereafter constitute the committee of
creditors comprising of financial creditors, which is not a related party.

Q48. Whether a financial creditor being a related party of the corporate debtor, can
participate or vote in the committee of creditors.
Ans: No, a financial creditor which is a related party to the corporate debtor is not included in the committee of creditors and therefore, shall not have any voting share in the committee.

Q49. How shall the voting share of financial creditors be determined in case of consortium
finance arrangement?
Ans: In a case, where the corporate debtor owes financial debts to two or more financial creditors as part of a consortium or agreement, each such financial creditor shall be part of the committee of creditors and their voting share shall be determined on the basis of the financial debts owed to them.

Q50. What will the committee of creditors comprise in case there is no financial creditor or
they are related parties?
Ans: Where the corporate debtor does not have financial creditors or where all financial creditors are its related parties, the committee of creditors shall comprise of operational creditors and shall be set up as per regulation 16 of the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016.

Q51. Who shall be the members of the committee of creditors consisting of only operational
creditors?
Ans: As per regulation 16 of the Insolvency and Bankruptcy Board of India (Insolvency
Resolution Process for Corporate Persons) Regulations, 2016, the committee of creditors having only operational creditors shall consist of following members:
a) eighteen largest operational creditors by value or all operational creditors, where they are less than eighteen in number;
b) one representative elected by workmen other than workmen included under ‘a’; and
c) one representative elected by all employees other than employees included under ‘a’

Q52. How is the resolution professional appointed by the committee of creditors?
Ans: The committee of creditors, may, in the first meeting or subsequent meeting either resolve to appoint the interim resolution professional as resolution professional or to replace the interim resolution professional by another resolution professional by at least sixty-six percent voting share.

Q53. Who shall be the recipients of the notice of the meeting of committee of creditors?
Ans: The interim resolution professional or resolution professional, as the case may be, shall send the notice of the meeting of committee of creditors to:
a) all the members of the committee of creditors including authorised representatives,
b) members of suspended board of directors or partners of corporate debtor, and
c) operational creditors or their representatives if amount of their aggregate due is not less than 10% of the debt.
However, only the members of the committee of creditors shall have voting rights while others shall have right to participation only.

Q54. What is the quorum for the meeting of committee of creditors?
Ans: There should be members holding at least thirty three percent of voting rights either present in person or by video conferencing or by audio visual means, to form a quorum.

Q55. What are the contents of the notice of meeting of committee of creditors?
Ans: The contents of the notice are provided in regulation 21 of the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016. The notice contains information relating to venue, time, and options available for participation through video conferencing or audio and visual means. It shall also contain:
a) a list of the matters to be discussed at the meeting;
b) a list of the issues to be voted upon at the meeting; and
c) copies of all documents relevant to the matters to be discussed and the issues to be voted upon at the meeting

Q56. Does a member of committee of creditors need to be physically present in the meeting to cast vote?
Ans: A member of the committee of creditors can participate in the meeting through electronic means also. As per regulation 25 of the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016, the resolution professional is required to take the vote of the members of the committee of creditors present in the meeting.
However, in respect of members who did not vote at the meeting on the matters listed for
voting, the resolution professional shall also seek a vote, by electronic voting system in accordance with regulation 26 where the voting shall be kept open for at least 24 hours from the circulation of the minutes.
Q57. How is the authorised representative for the class of creditors appointed?
Ans: The interim resolution professional shall identify three insolvency professionals, from the State or Union Territory, which has the highest number of creditors in the class as per records of the corporate debtor, for representation of such creditors. The interim resolution professional, in public announcement (Form A), shall offer choice of three such insolvency professionals to act as the authorised representative for the class of creditors. Thereafter, the insolvency professional who is the choice of the highest number of financial creditors in the class is selected by the interim resolution professional to act as the authorised representative of the creditors in respective class and apply to the Adjudicating Authority for his appointment.

Q58. What are the rights and duties of the authorised representative of financial creditors?
Ans: The rights and duties of the authorised representative are as provided under section 25A of the Code. It includes the right to participate and vote in the meetings of committee of creditors.
The authorised representative circulates the agenda of the meeting to the creditors in class and may seek their preliminary views to enable him to effectively participate in the meeting. Thereafter, the authorised representative circulates the minutes of the meeting and seeks voting instructions from such creditors to enable him to vote accordingly.

Q59. When is the first meeting of committee of creditors held?
Ans: The first meeting of committee of creditors is to be held within 7 days of filing of report of its constitution to the Adjudicating Authority. It is held within 30 days from insolvency commencement date.

Q60. What happens to the CIRP where the interim resolution professional is not appointed
as resolution professional by committee of creditors or Adjudicating Authority?
Ans: The interim resolution professional continues to perform the functions of the resolution professional from the 40th day of the insolvency commencement date till a resolution professional is appointed.

Q61. Whether interim resolution professional or resolution professional can unilaterally
undertake significant actions during CIRP?
Ans: No. Section 28(1)(a) to (m) of the Code, elaborate the list of actions that require prior
approval of the committee of creditors by a vote of sixty-six per cent of the voting shares. These include matters like interim finance, creation of security interest over the assets of corporate debtor, change of capital structure or recording any change in ownership interest of corporate debtor, undertaking related party transactions, making change in management, etc.

Q62. What happens when resolution professional acts without approval of committee of
creditors for actions listed under Section 28(1)?
Ans: Such action shall be void. The committee of creditors may report the actions of the resolution professional to the Board for taking necessary actions against him under the relevant provisions ofthe Code.

Q63. When can a resolution professional be replaced?
Ans: Where the committee of creditors is of the opinion that a resolution professional appointed under section 22 is required to be replaced, it may pass a resolution to that effect by a vote of sixty six per cent of voting shares. The committee of creditors may thereafter apply to the Adjudicating Authority for the appointment of proposed resolution professional along with the written consent from such person in the specified form.

Q64. Who will appoint the valuers and for what purpose?
Ans: The resolution professional appoints two registered valuers within 7 days of his appointment but not later than 47th day from the insolvency commencement date, to determine the fair value and liquidation value of the corporate debtor.

Q65. What is fair value?
Ans: As per regulation 2(hb) of the Insolvency and Bankruptcy Board of India (Insolvency
Resolution Process for Corporate Persons) Regulations, 2016, fair value means the estimated realizable value of the assets of the corporate debtor, if they were to be exchanged on the insolvency commencement date between a willing buyer and a willing seller in an arm’s length transaction, after proper marketing and where the parties had acted knowledgeably, prudently and without compulsion.

Q66. What is liquidation value?
Ans: As per regulation 2(k) of the Insolvency and Bankruptcy Board of India (Insolvency
Resolution Process for Corporate Persons) Regulations, 2016, liquidation value means the
estimated realizable value of the assets of the corporate debtor, if the corporate debtor were to be liquidated on the insolvency commencement date.

Q67. Can fair value or liquidation be shared with members of committee of creditors or the
prospective resolution applicant?
Ans: The fair value and liquidation value may be shared with the members of the committee of creditors only after the receipt of resolution plan in accordance with the Code and Regulations, and receiving the confidentiality undertaking from each such member. However, fair and liquidation value is not shared with the prospective resolution applicant.

Q68. What is Information Memorandum? Who prepares it? When is it prepared?
Ans: The information memorandum means a memorandum prepared by the resolution professional under section 29(1) containing relevant information of the corporate debtor for formulating a resolution plan. It shall contain those details specified in regulation 36(2) of the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016. The resolution professional is required to submit the information memorandum in electronic form to each member of the committee of creditors within 2 weeks of his appointment, but not later than 54th day from the insolvency commencement date, whichever is earlier. The sharing of information memorandum by the resolution professional to the members of the committee of creditors or to a resolution applicant is subject to receiving a confidentiality undertaking, in terms of regulation 36(4) of the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016.

Q69. When does the Resolution Professional publish invitation for the Expression of
Interest?
Ans: In terms of section 25(2)(h) of the Code, the resolution professional invites prospective resolution applicants who fulfill the criteria laid down with the approval of the committee of creditors , to submit a resolution plan or plans. For this purpose, the resolution professional publishes brief particulars of the invitation for expression of interest in Form G of the Schedule to the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016. The Form G states where detailed invitation for expression of interest, containing the eligibility criteria for prospective resolution applicants, can be downloaded or obtained and the last date of submission by eligible prospective resolution applicant.

Q70. Is there any provisional list of eligible prospective resolution applicants issued by the
resolution professional?
Ans: Yes, the resolution professional prepares and issues a provisional list of eligible prospective resolution applicants within ten days of the last date for submission of expression of interest

Q71. Can objection be raised against the provisional list of eligible prospective resolution
applicants issued by resolution professional?
Ans: Yes, such objection may be made with supporting documents within five days from the date of issue of the provisional list.

Q72. When does the resolution professional issue Request for resolution plan? To whom it is
issued and what are its contents?
Ans: The resolution professional issues the request for resolution plan, along with information memorandum and evaluation matrix to every prospective resolution applicant, appearing in the provisional list and to those who have contested the decision of resolution professional for his non inclusion in that list. The request for resolution plan is issued within five days of the date of issue of the provisional list. It shall detail each step of the process, the manner and purpose of interaction between the resolution professional and prospective resolution applicant and the timelines for each activity.

Q73. When is the final list of eligible prospective resolution applicants issued by the
resolution professional?
Ans: The resolution professional issues the final list of prospective resolution applicants to the committee of creditors, within ten days of the last date for receipt of objections.

Q74. Does the request for resolution plans submission also require submission of any nonrefundable deposit?
Ans: No, the request for resolution plan does not require submission of any non-refundable deposit.
Q75. What is Resolution Plan?
Ans: As section 5(26) of the Code, resolution plan means a plan proposed by any person for insolvency resolution of the corporate debtor as a going concern in accordance with Part II. It may include provisions for the restructuring of the corporate debtor, including by way of merger, amalgamation and demerger.

Q76. Who prepares the Resolution Plan?
Ans: A resolution applicant prepares the Resolution Plan on the basis of the information
memorandum given by the resolution professional.

Q77. Is there any list of persons who are not eligible to act as resolution applicants?
Ans: Yes, section 29A of the Code lists out the kind of persons who are not eligible to submit a resolution plan, either individually or acting jointly or in concert. The ineligibilities include undischarged insolvent, willful defaulter as per guidelines of RBI, classification of account as Non Performing Asset for more than one year, conviction for certain offences, disqualification to act as director of company, prohibition from trading in securities market, invoked guarantee remaining unpaid, having connected person with similar ineligibilities etc.

Q78. How can a resolution applicant submit his resolution plan?
Ans: A resolution applicant may submit a resolution plan to the resolution professional, prepared on the basis of the information memorandum, along with an affidavit stating that he is eligible under section 29A.

Q79. Within what time resolution applicants are to submit their resolution plans?
Ans: The prospective resolution applicants shall be provided a minimum of thirty days to submit the resolution plan(s).

Q80. Is there any requirement for furnishing performance security by the resolution
applicant?
Ans: Yes, the request for resolution plan requires the resolution applicant to provide a performance security of such nature, value, duration, and source within the time specified. Further, such performance security is liable to be forfeited in case of any failure or contribution in failure by the resolution applicant in implementation of resolution plan approved by the Adjudicating Authority.

Q81: Who shall examine that the resolution plan meets the requirements laid down under
Section 30(2)?
Ans: The resolution professional.

Q82: What is the process of approval of resolution plan?
Ans: The committee of creditors evaluates all compliant resolution plans as per evaluation matrix and thereafter vote on all such plans simultaneously. The resolution plan needs an approval of at least sixty-six percent of voting share of the committee of creditors. Further, the resolution plan, which receives the highest votes, is considered as approved. After the resolution plan is approved by the committee of creditors, the resolution professional submits the resolution plan to the Adjudicating Authority. Thereafter, the Adjudicating Authority accords final approval to the resolution plan under section 31(1) of the Code.

Q83: Can a resolution applicant attend meeting of the committee of creditors?
Ans: Yes. The resolution applicant may attend the meeting of the committee of creditors.
However, the resolution applicant shall not have a right to vote at the meeting of the committee of creditors unless such resolution applicant is also a financial creditor.

Q84. After filing of claim, when can one expect the payment to be credited or made?
Ans: The payments will be made as per the resolution plan approved by the committee of creditors of the corporate debtor, and further by the Adjudicating Authority, including any modifications thereof. All payments shall be dealt with in accordance with the provisions of the Code.

Q85. What is the manner of payment to operational creditors and dissenting financial
creditors under a resolution plan?
Ans: The payment to operational creditors and to financial creditors who do not vote in favour of the resolution plan are required to be provided in the resolution plan in the manner stated in section 30(2)(b) of the Code. Further, regulation 38 of the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016 provides for the mandatory contents of the resolution plan, which inter alia include that amount payable to the operational creditors and to financial creditors who did not vote in favour of the resolution plan shall be paid in priority to financial creditors who voted in favor of resolution plan.

Q86. What happens when the resolution plan is not filed within 180 days of the
commencement date or such other extended period?
Ans: The Adjudicating Authority may pass orders for the liquidation of the corporate debtor if the resolution plan is not filed within 180 days of insolvency commencement date or such other extended period.

Q87. Does committee of creditors make any assessment of corporate debtor to be sold as a
going concern?
Ans: Under regulation 39C of the Insolvency and Bankruptcy Board of India (Insolvency
Resolution Process for Corporate Persons) Regulations, 2016, while approving the resolution plan under section 30 or deciding to liquidate the corporate debtor under section 33, the committee of creditors may recommend that the liquidator may first explore sale of the corporate debtor as a going concern or sale of business of the corporate debtor as a going concern,. The committee of creditors may also identify and group the assets/liabilities, which according to commercial considerations may be sold as going concern.

Q88. Who is responsible for determining and filing applications in relation to avoidance
transactions of a corporate debtor against which CIRP has been admitted?
Ans: As per section 25(2)(j) of the Code, it is the duty of the resolution professional to file
application for avoidance of transactions under sections 43 (preferential transactions), 45
(undervalued transactions), 50 (extortionate transactions) or 66 (fraudulent transactions) of the Code. In terms of regulation 35A of the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016 the resolution professional is required to form an opinion on such transactions within 75 days, to make determination within 115 days and file application before Adjudicating Authority within 135 days from insolvency commencement date.

Q89. What is the look back period for determination of preferential and other transactions
under the Code?
Ans: The look back period for preferential or undervalued transactions is one year preceding the insolvency commencement date in case of non-related party, and two years preceding the insolvency commencement date in case of related party. For extortionate transactions, the look back period is two years preceding insolvency commencement date. There is no specific look back period for fraudulent transactions.

Q90. Which authority acts as Appellate Authority for CIRP and liquidation under the
Code?
Ans: National Company Law Appellate Tribunal.

Q91. What are the timelines for filling an appeal before the National Company Law
Appellate Tribunal under the Code?
Ans: Every appeal before National Company Law Appellate Tribunal is to be filed within a period of 30 days from the date of order by National Company Law Tribunal. However, National Company Law Appellate Tribunal may allow an appeal after the expiry of said period on genuine reasons, but such period should not exceed 15 days.

Q92. What are the grounds for appeal against an order approving a resolution plan under
section 31 of the Code?
Ans: The grounds on which an order approving resolution plan can be challenged under the Code are as laid down in section 61(3)(i) to (v). It, inter alia, includes grounds such as approved resolution plan in contravention of provision of any law, material irregularity in exercise of powers by resolution professional, debts owed to operational creditors not provided in resolution plan in manner specified insolvency resolution process costs not provided for repayment in priority to other debts etc.

Q93. What are the grounds for appeal against liquidation order passed under section 33 of
the Code?
Ans: An appeal against a liquidation order passed under section 33 may be filed on grounds of material irregularity or fraud committed in relation to such a liquidation order.

Q94. Can an appeal be made against the order of National Company Law Appellate
Tribunal?
Ans: Any person aggrieved by the order of National Company Law Appellate Tribunal may file an appeal to the Supreme Court on a question of law.

Q95. What are the timelines for filling an appeal before Supreme Court of India?
Ans: Every appeal before Supreme Court is to be filed within a period of 45 days from the date of order by National Company Law Appellate Tribunal. However, Supreme Court may allow an appeal after the expiry of said period on genuine reasons but such period should not exceed 15 days.

Q96. Whether any civil court or authority has jurisdiction to entertain any suit or proceeding under the Code?
Ans: No

Q97. What is procedure and timelines for filling online forms by the Insolvency Professional
on the electronic platform of the Board?
Ans: Please refer regulation 40B of the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016 that prescribes timeline with in which an insolvency professional, shall file the Forms, along with the enclosures thereto, on the electronic platform of the Board.

Q98. Who can go for Fast track corporation insolvency resolution process (Fast Track
CIRP)?
Ans: Chapter IV Part II of the Code provides a fast track process for insolvency resolution, which is applicable in respect of the following category of corporate debtors laid down in section 55(2) of the Code:
a) a corporate debtor with assets and income below a level as may be notified by the Central Government; or
b) a corporate debtor with such class of creditors or such amount of debt as may be notified by the Central Government; or
c) such other category of corporate persons as may be notified by the Central Government.

Q99. What are the categories of corporate debtor, notified by the Central Government for
the purpose of Fast Track CIRP?
Ans: The Central Government has notified the following categories of corporate debtors:
a) a small company as defined under 2(85) of Companies Act, 2013 (18 of 2013); or
b) a startup (other than the partnership firm) as defined in the notification of the Government of India in the Ministry of Commerce and Industry number G.S.R. 501(E), dated the 23rd May, 2017 published in the Gazette of India, Extraordinary, Part II, section 3, sub-section (i), dated the 23rd May, 2017; or
c) an unlisted company with total assets, as reported in the financial statement of the immediately preceding financial year, not exceeding ₹ 1 crore.

Q100. What are the timelines for completion of Fast Track CIRP?
Ans: The fast track process is required to be conducted within a period of 90 days with a provision of one-time extension of up to 45 days.

Q101. Whether there is any regulation governing Fast Track CIRP?
Ans: Yes. The Insolvency and Bankruptcy Board of India (Fast Track Insolvency Resolution
Process for Corporate Persons) Regulations, 2017.

Disclaimer: The FAQs have been prepared solely for the purpose of creating awareness and must not be used as a guide for taking or recommending any action or decision, commercial or otherwise. One must do its own research or seek professional advice, if it intends to take any action or decision using the material covered here.

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In this modern era, organisations have become more people-centric than ever — especially since this approach pays great dividends in terms of enhanced employee performance and lower attrition rates. Human Resource Management or HRM plays a key role in allowing employers and organisations to reach their objective.

The functions of Human Resources Management hold great significance in the growth and overall development of the organisations. After all, when the employees grow and develop their skills, the organisation will automatically experience growth and expansion. Some of the primary functions of Human Resources Management include job design and job analysis, recruitment/ hiring and selection, training and development, compensation and benefits, performance management, managerial relations and labour relations.

1) Which of the following is the correct abbreviation of HRM?

1. Human Resource Management
2. Human Resourcefulness Management
3. Human Relation Management
4. Humanistic Relation Management

Answer Human Resource Management

Reason : Human resource management is strategic planning followed by several organizations that focus on recruiting, managing, and guiding newly hired employees.

2. __________ is considered as first wage incentive plan in the modern era of the industry.

1. Barth plan
2. Halsey plan
3. Gantt task plan
4. Taylor’s differential piece-rate plan

Answer Taylor’s differential piece-rate plan

Reason : None.

3. Which of the following is involved in the in-basket training?

1. Simulation
2. On-the-job training
3. Vestibule training
4. Coaching

Answer Simulation

Reason: In-basket training is a kind of exercise that is accompanied by the organizations while hiring and promoting an employee.

4. Under which of the following methods, common factors related to all jobs are identified?

1. Merit
2. Ranking
3. Factor comparison
4. Point

Answer Point

Reason: Under the Point method, common factors related to all the jobs are identified. It identifies all the possible job factors under primary groups (i.e., skill, effort, responsibilities, working conditions), typically up to five groups, where each factor is assigned with a dollar value (as opposed to pointing value).

5. Which of the following involves one to one interaction amid the administer and the participant?

1. Motivation
2. Counseling
3. Training
4. All of the above

Answer Counselling

Reason: To formulate self-difficulties like stress or emotional feelings caused due to heartbreaks or any professional/personal issues, the client set a meeting with the counselor to undertake a counseling session.

6. Stress is laid on __________ in the grid seminars.

1. Professionalism
2. Training and Development
3. Teaching
4. All of the above

Answer Teaching

Reason: Stress is laid on teaching in the grid seminars. In general, the Grid Training refers to a comprehensive organizational development program, which was formerly developed by Blake and Mouton to put emphasis on the complete development of individuals, groups, and the organization as a whole.

7. Which of the following is enhanced by 360-degree feedback?

1. Managerial decisions
2. HR decisions
3. HRD
4. All of the above

Answer All of the above

Reason: 360-Degree Feedback enhances the quality of HR, Management, and HRD decisions.

8. What is the difference between the Japanese management system and other management systems?

1. It is a system in contrast to the American management system.
2. It is mainly concern with high quality and performance standards.
3. It is encouraged to perform repetitively and reliably.
4. None of the above.

Answer It is a system in contrast to the American management system.

Reason: Japanese management system emphasizes creating skilled workers by making them adapt to organizational changes, as and when required.

9. What is included in the content of the job description?

1. Skills and educational qualification
2. Job title and work environment
3. Both (a) and (b)
4. None of the above

Answer Job title and work environment

Reason: The job description provides all the desired information which is required for evaluating a job. Job analysis is a systematic process that collects all the relevant statistics about the job for articulating job description and job specification, required for selecting an employee, providing job satisfaction and motivation, etc.

10. What does job evaluation seek?

1. Evaluating the importance of different jobs within the organization.
2. Evaluating employee’s performance of their respective job profiles.
3. Determining the relative worth of various jobs within the organization in monetary terms.
4. Establishing the hierarchy of different job profiles in the organization.

Answer Determining the relative worth of various jobs within the organization in monetary terms.

Reason: A job evaluation refers to an efficient way of defining the value of a job in contrast to other jobs within an organization.

11. How are the union leaders elected at different federations?

1. based on employer’s recommendations
2. Based on the seniority
3. Based on political considerations
4. Based on the democratic principle

Answer Based on the democratic principle

Reason:  Union leaders at different levels and federation get elected on the basis of democratic principle. Organizational democracy refers to the system of organization, which is more focused on freedom than that of fear and control.

12. Which of the following pairs in the given sequence represents the initial as well as the final step incurred in the T&D program?

1. Evaluating T&D program followed by implementing it.
2. Determining the need for the T&D program and then evaluating the T&D program.
3. Determining the need for the T&D program followed by designing the T&D program itself.
4. Designing the T&D program and then implementing it.

Answer Determining the need for the T&D program and then evaluating the T&D program.

Reason: The (T&D) program, which is abbreviated as “Training and Development,” is one of the most powerful and essential programs for organizations as it makes it easier to make an improvement and develop the skills and knowledge of their employees.

13. Which of the following refers to the term quality improvement?

1. A team effort.
2. Achieved by the quality inspector.
3. Zero things went wrong.
4. Tough job; somewhat impossible task.

Answer Achieved by the quality inspector.

Reason: Quality improvement can be identified as a structured approach that helps in assessing the performance of systems and processes, followed by determining if there is any need for improvement in both functional and operational areas.

14. For closure, each worker has to compensate with __________ average pay for each preceding year of completed service.

1. 20 days
2. 15 days
3. 25 days
4. 30 days

Answer 15 days

Reason: For closure, each worker has to compensate with 15 days average pay for each preceding year of completed service. The retrenched employee must be provided with 15 days of average pay for a year of continuous service or any part thereof in excess of six months.

15. Which of the following are one of kind of skills inventory, regression, replacement charts, Markov analysis?

1. Training plan
2. Retention plan
3. Redundancy plan
4. Forecasting methods

Answer Forecasting methods

Reason: Forecasting refers to a process of formulating the predictions of upcoming events, which requires historical data.

16. Why is the career path in Japanese employee management non-specified?

1. Rotational job results in providing a benefit such skills that are necessary for top-quality executives.
2. At the time of induction, the employees within the organization get exposure to switch their careers in different job domains and get themselves trained to have hands-on trending technologies.
3. In order to keep the employee up to date, the Japanese industries offer rotational jobs.
4. Japanese management system emphasizes creating skilled workers by making them adapt to organizational changes as and when required.

Answer Japanese management system emphasizes creating skilled workers by making them adapt to organizational changes as and when required.

Reason: None.

17. What is meant by the factual statement of the duties and responsibilities?

1. Job analysis
2. Job specification
3. Job evaluation
4. Job description

Answer job description

Reason: The job description provides all the desired information which is required for evaluating a job. Job analysis is a systematic process that collects all the relevant statistics about the job for articulating job description and job specification, required for selecting an employee, providing job satisfaction and motivation, etc.

18. What are the possible factors that help in understanding the nature of a human being?

1. As per one’s behavior at his/her workplace.
2. Based on how successfully a management team influences an individual employee or a group.
3. With the help of human behavior’s determinants.
4. By studying the human behavior of each employee in alliance with the organization.

Answer As per one’s behavior at his/her workplace.

Reason: The following factors help understand human nature:

• Tasks and workload patterns
• Working environment
• Leadership quality
• Availability of resources
• Skills acquired by an individual
• Employee attitude, risk tolerance, and personality

19. What do you understand by the written record of duties, responsibilities, and conditions of a job?

1. Job enrichment
2. Job ranking
3. Job enlargement
4. Job description

Answer Job description

Reason: A job description refers to a written record of duties, responsibilities, and conditions, including a complete informative portrayal in terms of scope, tasks, duties, obligations, and work environment for any specific job profile.

20. What is the ‘Laisezz Fair’ viewpoint?

1. A view popularized by Ronssean, Bentham, and Hobbes.
2. A minimum of public intervention in economic activities.
3. The business enterprise must get the opportunity to earn more profits.
4. The change in the concept of labor from the commodity approach to the human concept.

Answer A minimum of public intervention in economic activities.

Reason: None.

21. Which of the following provides necessary information for job evaluation?

1. Job Enrichment
2. Job Description
3. Job Ranking
4. Job Enlargement

Answer Job Description

Reason: The job description provides all the desired information which is required for evaluating a job. Job analysis is a systematic process that collects all the relevant statistics about the job for articulating job description and job specification, required for selecting an employee, providing job satisfaction and motivation, etc.

22. A/An __________ is considered to be a vertical move in terms of rank and responsibilities.

1. Appraisal
2. Reward
3. Increment
4. Promotion

Answer Promotion

Reason: A promotion is considered to be a vertical move in terms of rank and responsibilities. The act of promotion elevates an employee to a new position offering higher pay, privileges, or status than the previous one. It mainly refers to the vertical movement in terms of rank and responsibility.

23. A/An __________ is a plan or a program scheme that helps to motivate an individual or a group to deliver outstanding performance.

1. Promotion Scheme
2. Incentive Scheme
3. Reward
4. None of the above

Answer Incentive Scheme

Reason: An incentive scheme is a plan or program that motivates an individual or group performance. Incentive schemes attempt to link at least a portion of pay to job performance to encourage higher productivity. Incentives, as often called, should be aligned with the behaviors that help achieve organizational goals or performance. Incentives are either individual or group (organization-wide).

24. What is defined as a record of outcomes resulting from a particular job or an activity at a specific time?

1. Evaluation
2. Work function
3. Performance
4. None of the above

Answer Performance

Reason: Performance can be defined as a set of outcome records generated by a specific job function or activity during a particular time period. The assessment of employee’s performance discloses one’s contribution company’s objectives.

25. Which of the following is the correct abbreviation of MPDQ?

1. Modern Positions Developed Qualitatively
2. Management Process Descriptive Questions
3. Management Position Description Questionnaire
4. Methods for Personality Development Questions

Answer Management Position Description Questionnaire

Reason: The MPDQ, which stands for Management Position Description Questionnaire, refers to an inquiry form that is utilized in human resource management for analyzing the management positions.

26. Which of the following is evolved in staffing?

1. Termination
2. Estimation of workload
3. Personnel appointments and placements
4. All of the above

Answer All of the above

Reason: Staffing is a constant process that finds, selects, evaluates, and develops a healthy relationship on the work front between the present and forthcoming employees.

27. What does quantitative technique refer to?

1. Waiting line problems and the queuing theory
2. Gaming, Game theory and Probability theory
3. Models, simulation, and resource allocation technique
4. All of the above

Answer All of the above

Reason: None.

28. What is mean by decision in management?

1. To formulate a proper conclusion after considerations.
2. A decision that looks out for the alternatives.
3. A decision is the outcome of a group of people or an individual.
4. All of the above.

Answer To formulate a proper conclusion after considerations

Reason: None

29. Which of the following aims to put the financial measure on an organization’s intellectual capital?

1. Exchange of knowledge
2. Financial knowledge
3. The consortium
4. None of the above

Answer Exchange of Knowledge

30. Which of the following tells the correct importance of controlling?

1. Power to influence people’s behavior
2. Process of regulating the activities
3. An important mental process on the part of the manager
4. To ensure that all of the activities are coordinated as per the plan.

Answer To ensure all of the activities are coordinated as per the plan.

31. Which of the following takes a full interest in the process of strategic planning?

1. Training & Development
2. Quality Control
3. Human Resource
4. Production

Answer Training & Development

Reason: The training & Development team takes full part in the strategic planning process. It identifies the target that an organization is trying to accomplish and enlists the desired steps that are needed to encounter while reaching the target.

32. What is the scope of Human Resource Management?

1. Performing training and development sessions for employee growth.
2. Maintaining good impersonal industrial relations and worker’s morale for companies’ productivity.
3. Accomplishing advanced research in behavioral sciences, new ideas in man, management, and advances in the field of training and development.
4. None of the above.

Answer Accomplishing advanced research in behavioral sciences, new ideas in man, management, and advances in the field of training and development.

Reason: The scope of human resource management refers to all the activities accompanied under the HRM, which are as follows:

• Human Resource Planning
• Job Analysis Design
• Recruitment and Selection
• Orientation and Induction
• Training and Development
• Performance Appraisal
• Compensation, Planning, and Remuneration
• Motivation, health, safety, and welfare
• Industrial relations.

33. How many factors were identified by Pettigrew & Whipp to manage the successful change?

1. Four
2. Five
3. Three
4. Six

Answer Five

Reason: Pettigrew & Whipp postulated five key factors such as environmental assessment,” “leading change,” “linking strategic and operational change,” “human resources as assets and liability,” and “coherence” that are needed to manage the change. It is one such important factor, which is being shared among the high organization.

34. Who suggested that Human Resource Strategy isn’t as effective as it was supposed to be?

1. Tony Groundy
2. Peter Ducker
3. Anonymous
4. John Zimmerman

Answer Tony Groundy

Reason: Tony Groundy suggested that Human Resource Strategies are not much effective. Mainly HR Strategy (Human Resource Strategy) is designed for a long-term plan created to achieve objectives in the field of human resource and human capital management and development within the organization. Human Resource strategy is one of the outputs of strategic management in the field of human resources management.

35. Which of the following issues tends to be well disguised?

1. Territorial
2. Social
3. Political
4. Economical

Answer Territorial

Reason: Territorial issues tend to be well disguised. Sales operations adjust territories at least annually and usually include input from first-line managers, who bring local knowledge to the table. When making adjustments to territories, they consider workload, relationships, and even sales rep characteristics such as tenure and experience.

36. Developing characteristics of people are needed to run business in __________.

1. Short term
2. Medium term
3. Long term
4. All of the above

Answer Long term

Reason: The developing characteristics of people need to run business in the long term. The long-run refers to the time horizon required for a producer to have flexibility over all relevant production decisions.

37. What are those aspects on which the HR professionals apply the risk management techniques?

1. HR Competencies
2. HR Strategies
3. Both (a) and (b)
4. None of the above

Answer HR Strategies

Reason: The Human Resource Strategy refers to an overall plan of a business that helps manage the human capital to align it with its business activities. It sets a direction for all the major areas of HR that includes the hiring process, performance appraisal, development, and compensation.

38. What does a job specification include?

1. Personal characteristics
2. Physical characteristics
3. Psychological characteristics
4. All of the above

Answer All of the above

Reason : In general, a job specification labels the knowledge, skills, education, experience, and abilities required in a person for the desired job.

39. How has HRM become one of the highly focused jobs?

1. It focuses on obtaining as well as maintaining a satisfied workforce.
2. It results in maximum output with the increased customer satisfaction.
3. It promotes group satisfaction with individual development.
4. Optimum utilization of manpower by motivation and improving efficiency.

Answer It results in maximum output with the increased customer satisfaction.

Reason: None

40. The business side of the process begins with the strategic __________ as one of the guiding frameworks.

1. Policy
2. HR
3. Plan
4. All of the above

Answer Plan

Reason: The business side of the process begins with the strategic plan as the guiding framework. Strategic planning can be understood as a process of managing a company’s resources to meet the end results, which mainly involves setting up the objectives, a complete analysis of the competitive environment and internal organization, assessing strategies accompanied by ensuring that management has rolled out the policies across the organization.

41. Who laid the foundation of Human Resource Management practices?

1. David C. McClelland
2. Roethlisberger and Dickinson
3. Peter Drucker and Douglas McGregor
4. Elton Mayo

Answer Peter Drucker and Douglas McGregor

Reason:  Peter Drucker and Douglas McGregor laid the foundation of HRM practices.

42. Which of the following is considered as strategic activity?

1. Productivity
2. Recruitment
3. Planning
4. All of the above

Answer Recruitment

Reason: Recruitment refers to a strategic activity as it mainly focuses on fascinating the desired candidates for the specific roles. Selecting is a process undertaken to recognize and select the eligible candidate for the desired job. So, we can conclude that recruitment is not an operational activity but plays a vital role in any organization’s strategic activity.

43. Which of the following fields requires a skilled HR professional?

1. People handling
2. Clarifying
3. Both (a) and (b)
4. None of the above

Answer Clarifying

Reason: HR professionals are required to be skilled in the field of clarifying fuzzy visions followed by providing feedback to the managers and the higher authority at the same time.

44. Human relation approach refers to __________

1. An approach in which workers are facilitated with humanity at the workplace.
2. A shared teamwork between the employee and the employer for solving problematic issues.
3. Forming a group of people on the work front so as to inspire them to work collectively for the company’s growth in terms of social, economic, and psychological productivity.
4. None of the above

Answer Forming a group of people on the work front so as to inspire them to work collectively for the company’s growth in terms of social, economic, and psychological productivity.

Reason: Human relations are defined as the study of group behavior for the purpose of improving interpersonal relationships as among employees.

45. Directing, being one of the preeminent functions of Human Resource Management that falls under __________

1. Operative functions
2. Technical functions
3. Managerial functions
4. Behavioral functions.

Answer Managerial functions

Reason: In order to meet the desired goals or the end results, the manager directs the workers by means of instructing, guiding, and overviewing their performance.

46. What is the need for Human Resource Planning?

1. For undergoing an effective employee development program
2. To represent a base for recruitment
3. To represent a base for selection policy
4. All of the above

Answer All of the above

Reason : Human resource planning is one of the most strategic functions incorporated by the Human Resource Management team, which analyzes its employees’ capabilities and the demand or supply of work in the market.

47. Which of the following components are reformed to support the strategies of human resource function?

1. Control systems
2. Appointment
3. Rewards
4. Job allotment

Answer  (a) & (c)

Reason: In order to support the strategies of human resource functions, control systems and rewards are altered. Strategic human resource management is a kind of practice in which employees are fascinated, developed, rewarded, and retained for the growth of both the employees and the organization.

48. Finding ways to reduce __________ is a crucial responsibility of management.

1. Stress
2. Dissatisfaction
3. Uncertainty
4. None of the above

Answer Uncertainty

Reason: The primary role of a manager is to ensure the daily functioning of a department or group of employees.

49.Human factor can be defined as __________

1. The entire concept of human behavior
2. Interrelated Physiological, Psychological and Socio-ethical aspects of a human being.
3. Micro and macro issues of socioeconomic factor
4. None of the above

Answer Interrelated Physiological, Psychological, and Socio-ethical aspects of a human being.

Reason: None.

50. Which of the following correctly defines the Human Resource Department?

1. Functional department
2. Service department
3. Line department
4. Authority department

Answer Service Department

Reason : As the name suggests, the human resource department handles all the organization’s activities pertaining to the employees.

Evolution Cycle of the HR Function

Every Human Resources department develops along with the development and growth of the organization. The HRM evolves through 3 distinct stages where it begins as a Business Function, turns into a Business Partner and afterwards a Strategic Partner.

In every one of these cases, the job and responsibilities of the HR division evolve to be more strategic. At more elevated levels of maturity, the HR department can increase the value of the leadership potential, top talent, company goals, employee retention rate and long haul manageability of the association.

At each stage, the credits and worth added by the Human Resources department change and the mediums required for this will change . At any rate, HR in an association should be liable for overseeing employee information, finance, time management, and setting up organization strategies. The HR department handles the effectiveness of human resource strategies and should be incorporated into every decision making process in the organization.

As a business partner, HR’s job is to meet the “current business needs” with the goal that the association can develop at a quantifiable rate. At this stage, HR moves to competency-based recruitment, pay grades, sudden turn of events, correspondence and organization plan.

HR helps in formalizing the organization hierarchy (who does what and reports to whom). That done, it recognizes the skills essential for each work job. Further, it helps in characterizing programs that are essential for building up these abilities, recruitment strategies to assess the expertise levels and benchmarking the abilities against industry norms and contenders etc.

All out salary (finance and advantages) likewise turns into a centre territory where the HR assists the association with drawing in and holding talented employees by turning into a pioneer in paying the employees.

Utilizing the expertise database and the company structure, the HR work develops pay hikes, improves the preparation capacity and makes the recruitment work more receptive to the abilities required by the association.

Organizations that see their HR as a strategic business partner have faith in giving the full maturity of their HR work. Such organizations are centered around accomplishing leadership roles instead of a year-on-year development.

Importance of HRM:

Strategy management is an essential component of every organization and plays a critical aspect in human resource management. HR managers oversee strategies to guarantee that the organization meets its business objectives while also making major contributions to corporate decision-making, which includes assessments for present workers and projections for subsequent ones based on business requirements. HR is also the agency to contact if any form of professional problem emerges between workers. They guarantee that challenges and disputes are properly handled by examining the topic objectively and fostering good conversation to establish a solution. Furthermore, they assist employees in understanding various methods of creating productive work connections as well as the need not to allow personal judgment to affect their behaviour.

Features of HRM

1. A Part of Management Discipline

HRM is a crucial aspect of administration. Even though it is not considered a profession in itself, it is unquestionably a subject of study. Because HRM is part of the management process category, it largely relies on management concepts, methods and procedures when managing the human resources of almost any business segment.

2. Universal Existence

HRM is universal and is applicable everywhere, irrespective of the size, nature and variety of scopes.

3. Concerned with People

HRM is concerned with the management of human resources or human characteristics in a business segment. It oversees a variety of individuals, including workers/labourers, bosses, managers and other associated senior managers. As a result, HRM is described as the management of “people resources’ and their dedication to their jobs.

4. Action-oriented

Instead of record-keeping, written processes or regulations, the focus of Human Resource Management is “activity.” Employee issues are resolved by sensible policies.

5. Directed towards the achievement of objectives

HRM is focused on working to attain organizational goals. It also gives tools and procedures for properly managing the firm’s human resources.

6. Integrating mechanism

Among the most essential purposes of HRM is to identify the best way to achieve shared goals. It also helps to establish friendly relationships among employees at all levels of a business.

7. Development-oriented

HRM strives to optimize or maximize the usage of employees’ talents or potential. For all of this, it tailors the compensation structure to the demands of the personnel. It also influences staff training in order to improve their abilities. It makes every effort to fully use the capabilities of its people to serve the organizational goals.

8. Continuous processes

Human Resources Management is an ongoing process, it operates from the day an organisation is created until it is disbanded. It primarily focuses on managing the firm’s human capital, which is a continuous process rather than a one-time event or a bad transaction.

9. Comprehensive function

Human Resources Management can never be an isolated process since it involves all employees. No one is exempt from the periphery of HRM, regardless of his or her status, remuneration or kind of job.

Objectives of HRM:

Some of the key objectives of HRM are:

• Human Resources managers strive to reduce expenses in areas, such as retaining employees. HR specialists are taught to conduct effective negotiations with potential and current workers, as well as to be knowledgeable about employee perks that are likely to attract excellent applicants and keep current employees.
• Human Resources managers play an important role in developing employer-employee relationships since they contribute considerably to training and development programs. This leads to staff development inside the organization, hence, increasing employee happiness and productivity.
• Human resource managers are in charge of organizing activities, events and celebrations inside the organization, which provide possibilities for team development. Furthermore, it increases employee engagement and fosters a sense of confidence and regard among colleagues.

Top  7 Functions of Human Resources Management:

1. Job design and job analysis
2. Employee hiring and selection
3. Employee training & development
4. Compensation and Benefits
5. Employee performance management
6. Managerial relations
7. Labour relations

Other Human Resources Management Functions:

8. Employee engagement & communication

9. Health and safety regulations

10. Personal support for employees

11. Succession Planning

12. Industrial Relations

1. Job design and job analysis

One of the foremost functions of HRM is job design and job analysis. Job design involves the process of describing duties, responsibilities and operations of the job. To hire the right employees based on rationality and research, it is imperative to identify the traits of an ideal candidate who would be suitable for the job. This can be accomplished by describing the skills and character traits of your top-performing employee. Doing so will help you determine the kind of candidate you want for the job. You will be able to identify your key minimum requirements in the candidate to qualify for the job.

Job analysis involves describing the job requirements, such as skills, qualification and work experience. The vital day-to-day functions need to be identified and described in detail, as they will decide the future course of action while recruiting.

2. Employee hiring and selection

Recruitment is one of the primary functions of human resource management. HRM aims to obtain and retain qualified and efficient employees to achieve the goals and objectives of the company. All this starts with hiring the right employees out of the list of applicants and favourable candidates.

An Human Resources Management helps to source and identify the ideal candidates for interview and selection. The candidates are then subjected to a comprehensive screening process to filter out the most suitable candidates from the pool of applicants. The screened candidates are then taken through different interview rounds to test and analyse their skills, knowledge and work experience required for the job position.

Once the primary functions of HRM in recruitment are completed, and the candidate gets selected after rounds of interviews, they are then provided with the job offer in the respective job positions. This process is important because these selected employees will, after all, help the company realise its goals and objectives.

3. Employee training & development

Imparting proper training and ensuring the right development of the selected candidates is a crucial function of HR. After all, the success of the organisation depends on how well the employees are trained for the job and what are their growth and development opportunities within the organisation.

The role of HR should be to ensure that the new employees acquire the company-specific knowledge and skills to perform their task efficiently. It boosts the overall efficiency and productivity of the workforce, which ultimately results in better business for the company.

Human Resources Management plays a very crucial role in preparing employees for bigger tasks and responsibilities, which leads to the holistic development of employees at work. And an organisation which provides ample growth and development opportunities to its employees is considered to be a healthy organisation.

4. Compensation and Benefits

Benefits and compensation form the major crux of the total cost expenditure of an organisation. It is a must to plug the expenses, and at the same time, it is also necessary to pay the employees well. Therefore, the role of human resource management is to formulate attractive yet efficient benefits and compensation packages to attract more employees into the workplace without disturbing the finances of the company.

The primary objective of the benefits and compensation is to establish equitable and fair remuneration for everyone. Plus, HR can use benefits and compensation as a leverage to boost employee productivity as well as establish a good public image of the business.

Therefore, one of the core HR department functions is to lay down clear policies and guidelines about employee compensation and their available benefits. One of the functions of HR manager is to ensure the effective implementation of these policies and guidelines. This creates equality and builds transparency among the employees and the management within the organisation. After all, the level of employee satisfaction at work is directly proportional to the compensation and benefits they receive.

5. Employee performance management

The next activity on HR functions list is effective employee performance management. Effective performance management ensures that the output of the employees meets the goals and objective of the organisation. Performance management doesn’t just focus on the performance of the employee. It also focuses on the performance of the team, the department, and the organisation as a whole.

The list of HR functions for performance management includes:

• • Developing a proper job description
  • Initiating an appropriate selection process to hire the right candidates for the job positions
  • Providing the right training and education needed to enhance the performance of the employees
  • Enabling real-time feedback and coaching employees to boost efficiency among them
  • Conducting performance reviews monthly or quarterly to discuss the positives and the improvement areas of employees
  • Formulating a proper exit interview process to understand why experienced employees choose to leave the company
  • Designing a proper appraisal and compensation system that recognises and rewards the workforce for their effort and hard work

6. Managerial relations

Relationships in employment are normally divided into two parts — managerial relations and labour relations. While labour relations is mainly about the relationship between the workforce and the company, managerial relations deals with the relationship between the various processes in an organisation.

Managerial relations determine the amount of work that needs to be done in a given day and how to mobilise the workforce to accomplish the objective. It is about giving the appropriate project to the right group of employees to ensure efficient completion of the project. At the same time, it also entails managing the work schedules of employees to ensure continued productivity. It is essential that HR handles such relations effectively to maintain the efficiency and productivity of the company.

7. Labour relations

Cordial labour relations are essential to maintain harmonious relationships between employees at the workplace. At the workplace, many employees work together towards a single objective. However, individually, everyone is different from the other in characteristics. Hence, it is natural to observe a communication gap between two employees. If left unattended, such behaviours can spoil labour relations in the company.

Therefore, it is crucial for an HR to provide proper rules, regulations and policies about labour relations. This way, the employees have a proper framework within which they need to operate. Therefore, every employee will be aware of the policies which will create a cordial and harmonious work environment.

Such a structured and calm work atmosphere also helps with improving performance and aching higher targets.

8. Employee engagement and communication

Employee engagement is a crucial part of every organization. Higher levels of engagement guarantee better productivity and greater employee satisfaction. Efficiently managing employee engagement activities will help in improving the employee retention rates too. HRM is the right agent who can manage the employee engagement seamlessly. Proper communication and engagement will do wonders for the employees as well as the organization. The more engaged the employees are, more committed and motivated they will be.

Human resource teams know the ‘humans’ of the organization better than anyone else. This gives them an upper hand in planning engagement activities. Although such activities might not fall under the direct functions of HRM, they are indeed required for the organizational welfare and employer branding.

9. Health and safety regulations

Every employer should mandatorily follow the health and safety regulations laid out by the authorities. Our labour laws insist every employer to provide whatever training, supplies, PPE, and essential information to ensure the safety and health of the employees. Integrating the health and safety regulations with company procedures or culture is the right way to ensure the safety of the employees. Making these safety regulations part of the company activities is one of the important functions of HRM.

10. Personal support for employees

HRM assists employees when they run into personal problems which may interfere with the workflow. Along with discharging administrative responsibilities, HR departments also help employees in need. Since the pandemic, the need for employee support and assistance has substantially increased. For example, many employees needed extra time off and medical assistance during the peak period of the pandemic. For those who reached out for help, whether it may be in the form of insurance assistance or extra leaves, companies provided help through HR teams.

11. Succession Planning

Succession planning is a core function of HRMs. It aims at planning, monitoring, and managing the growth path of the employees from within the organizations.

What usually happens is that promising and bright employees within the organization who have excelled in their roles are handpicked by their supervisors and HRs, and their growth paths are developed.

This, of course, becomes quintessential as those employees who recognize the fact that the company is investing in their growth and development, and therefore, will stay loyal in the long run. However, while developing such employees towards a higher role, companies must keep in mind several aspects, such as improving employee engagement, assigning challenging tasks and activities.

An employee leaving the organisation can prove to be disruptive and expensive. Therefore, succession planning is a saviour of some sorts, as it helps identify the next person who is just right to replace the outgoing individual.

12. Industrial Relations

It’s usually the production lines and manufacturing units where this HR function is mostly used. You see, Unions exist in factories and manufacturing units. And their responsibility is towards the goodwill about the workers — in fact, they’re always vocal and upfront about.

Now, for a company, especially into manufacturing and production, the HRs must have ongoing Industrial Relations practices. They must also continuously engage with the Unions in a friendly and positive manner to maintain amicable relations.

The true motive of Industrial Relation touches on a lot of issues within the company. For instance, Industrial Relations may be in place to meet wage standards, reduce instances that call for strikes and protests, improve working and safety conditions for employees, reduce resource wastage and production time and so on.

Industrial Relations is extremely important because, if handled properly, it can circumvent protests, violence, walkouts, lawsuits, loss of funds and production time. IR is a sensitive yet critical function of the HR department, naturally, it requires personnel with vast experience.

Human Resources Management plays a major role in the smooth functioning of the organisation. The process starts with formulating the right policies for the job requirements and ends with ensuring a successful business growth of the company. Therefore, HRM works as an invisible agent that binds together all the aspects of the organisation to ensure smooth progress.

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What is relation between Law and morality?

What is difference between law and morality?

Here are the some multi-choice questions enlisted for preparation for Pre Examination online Test, E-Learning ICSI & LAWs, LLB Law Examination.

These Multi-choice questions or MCQs can help you in your CS & CA and other law related exams. We have also provided Online exam solved answers for your preparation.

Note: Answers highlighted in Green are right answers.

91. What is similarity in law and morals?

a. both regulate human conduct
b. both not regulate human conduct
c. both use similar language
d. above a and c is correct

92. Morals have ______.

a. Universal values
b. various from society to society
c. various from time to time
d. various from person to person.

93. Law looks to __________.

a. external conduct
b. internal conduct
c. both a and b
d. none of above

94. The statutes dealing with tax are termed as ______.

a. civil statues
b. penal statute
c. fiscal statutes.
d. personal statutes

95. When there is a conflict between two or more statues or two or more parts of a statute then the rule

a. welfare construction
b. strict construction
c. harmonious construction
d. none of above

96. Pith and substance is a legal doctrine in ________.

a. Canadian constitutional interpretation
b. Indian constitutional interpretation
c. Indian and Canadian Constitutional interpretation
d. none of above

97. The doctrine of colorable legislation refers to the

a. question of competency of the legislature
b. question of fact
c. question of jurisdiction
d . nature of legislation

98. Repugnancy as an inconsistency or contradiction between two or more parts of a legal instrument

a. true
b. false
c. can’t say

99. Law Commission of India is ________.

a. executive body
b. judicial body
c. legislative body
d. quasi-judicial body

100. The first Law Commission was established during the British Raj era in _____.

a. 1834
b. 1836
c. 1860
d. 1881

Preparation for Pre-Examination Test,

E-Learning ICSI & LAWs Law Examination.

Multi-choice questions or MCQs for CS & CA exams.

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Parliament of India consists of the President and two houses. The lower house is called the House of the People- Lok Sabha, while the upper house is known as the Council of States- Rajya Sabha.

Council of Ministers

Council of ministers shall be composed of not less that 250 members, of whom 12 shall be nominated by the President and the remainder 238 shall be representatives on the States and Union Territories elected by the method of indirect election.

Nomination- The 12 nominated members shall be chosen by the President from amongst persons having special knowledge or practical experience in literature, science, art and social service.

Representation of States

The representatives of each State shall be elected by the elected members of the Legislative assembly of the State in accordance with the system of proportional representation by means of a single transferable vote.

Representation of Union Territories

The representatives of the Union Territories shall be chosen in such a manner as Parliament may prescribe. Under this power, the Parliament has prescribed that the representatives of Union Territories to the Council of States shall be indirectly elected by members of an electoral college for that territory, in accordance with the system of proportional representation by means of the single transferable vote.

Note: Answers highlighted in Green are right answers.

81. In a federal system, the guardian of the Constitution is

a. the Parliament
b. the Judiciary
c. the council of Ministers
d. the National Security Advisor

82. The Union Legislature in India is empowered

a. Not to amend the basic structure of the Constitution
b. to amend the basic structure of the Constitution
c. To abrogate the basic structure
d. None of these

83. The states enjoy exclusive jurisdiction over subjects of

a. Union list
b. State list
c. Residuary List
d. Concurrent list

84. Majority provisions of the Constitution of India can be amended by

a. the Parliament
b. The President
c. the State Legislature
d. the Parliament of the consent of states

85. The procedure for amending the Constitution is in

a. Article 368
b. Article 360
c. Article 367
d. Article 371

86. The list dividing powers between union and states are given in the ————- schedule

a. IV
b. V
c. VI
d. VII

87. Operation of law means…..

a. prospective operation of law
b. retrospective operation of law
c. both as above a and b
d. none of above

88. What is mean repeal of law?

a. change in law
b. amendment in law
c. removal or reversal of law.
d. none of above

89. General clauses Act enacted in the year…

a. March 11, 1897
b. January 15, 1920
c. August 15 1987
d. December 31, 1975

90. The term morals refer…

a. ethics or principles
b. legal rules by a competent authority .
c. only above a is correct
d. both a and b correct.

FAQs For Constitution of India

Note: Answers highlighted in Green are right answers.

71. According to the ___________ rule, the words of the statute are to be given their plain and ordinary meaning.

a. Literal rule
b. golden rule
c. natural rule
d. mischief rule

72. Which rule of statutory interpretation should judges apply first?

a. Purposive approach
b. Mischief rule
c. Golden rule
d. Literal rule

73. The concept of the Judicial review has been borrowed from the Constitution of

(a) U.K.
(b) Switzerland
(c) U.S.A
(d) U.S.S.R

74. The idea of ‘concurrent list’ in the Indian constitution is taken from the Constitution of…………?

a. Ireland
b. Canada
c. Australia
d. Japan

75. What are the four factors the courts are required to consider according to Heydon’s case?

a. What was the mischief and defect for which the common law did not provide?
b. What was the common law before the Act was passed?
c. What was the remedy Parliament passed to cure the mischief?
d. All are above

76. When may judges apply the mischief rule?

a. When there is ambiguity in the statute
b. When there is absurdity
c. When the law needs to be changed
d. When not to do so would lead to injustice

77. Under the _________________ rule the words may be given a secondary meaning if applying the literal leads to absurdity.

a. mischief rule
b. golden rule
c. liber rule
d. none of above

78. The Union List consists of

a. 97 subjects
b. 61 subjects
c. 47 subjects
d. 73 subjects

79. An interpretation of the Constitution of India is based on the spirit of

a. Fundamental Duties
b. Fundamental Rights
c. Preamble
d. Federal System

80. The sequence of procedure for passing a Bill in the House is

a. First reading, Committee stage, report stage, second reading, third reading
b. First reading, second reading, committee stage, report stage, third reading
c. First reading, second reading, third reading, Committee stage, report stage
d. First reading, Committee stage, second reading, third reading

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Important Note

The Constitution does not use the terms ‘statute’ though one finds the terms ‘law’
used at many places. The terms ‘law’ is defined as including any ordinance, order,
bye-law, rule, regulation, notification, and the like.

In short ‘statute’ signifies written law in contradiction to unwritten law.

‘Document’: Generally understood, a document is a paper or other material thing
giving information, proof or evidence of anything.

The Law defines ‘document’ in a more technical form. Section 3 of the Indian Evidence Act, 1872 states that ‘document’ means any matter expressed or described upon any substance by means of letters, figures or marks or by more than one of those means, intended
to be used, or which may be used, for the purpose of recording that matter.

Example: A writing is a document, any words printed, photographed are documents.

Section 3(18) of the General Clauses Act, 1897 states that the term ‘document’ shall
include any matter written, expressed or described upon any substance by means of
letters, figures or marks, or by more than one of those means which is intended to be
used, or which may be used, for the purpose of recording this matter.
Generally, documents comprise of following four elements:

(i) Matter—

This is the first element. Its usage with the word “any” shows that the definition of document is comprehensive.

(ii) Record—

This second element must be certain mutual or mechanical device employed on the substance. It must be by writing, expression or description.

(iii) Substance—

This is the third element on which a mental or intellectual elements comes to find a permanent form.

(iv) Means—

This represents forth element by which such permanent form is acquired and those can be letters, any figures, marks, symbols which can be used to communicate between two persons.

Difference between Interpretation and Construction:

Interpretation is of finding out the true sense of any form and the construction is the drawing of conclusion respecting subjects that lie beyond the direct expression of the text. [Bhagwati Prasad Kedia v. C.I.T,(2001)]
Where the Court adheres to the plain meaning of the language used by the legislature, it would be ‘interpretation’ of the words, but where the meaning is not plain, the court has to decide whether the wording was meant to cover the situation before the court. Here the court would be resorting to what is called ‘construction’.
‘Interpretation’ and ‘Construction’ overlap each other and it is rather difficult to state where ‘interpretation’ leaves off and ‘construction’ begins.

Rules of Interpretation/Construction

Primary Rules

• Rule of Literal Construction

It is the cardinal rule of construction that words, sentences and phrases of a statute should be read in their ordinary, natural and grammatical meaning so that they may have
effect in their widest amplitude.
At the same time, the elementary rule of construction has to be borne in mind that words and phrases of technical nature are ‘prima facie’ used in their technical meaning, if they have any, and otherwise in their ordinary popular meaning.

When the language of the statute is plain and unambiguous and admits of only one meaning, no question of construction of a statute arises, for the Act speaks for itself.
The meaning must be collected from the expressed intention of the legislature (State of U.P. v. Vijay Anand, AIR 1963 SC 946).
A word which has a definite and clear meaning should be interpreted with that meaning only, irrespective of its consequences.

• Rule of Reasonable Construction

Generally the words or phrases of a statute are to be given their ordinary or “literal” meaning. But when the grammatical or literal construction leads to a manifest absurdity
then the courts shall interpret the statute so as to resolve the inconsistency and make the enactment a consistent whole.
This principle is based on the rule that the words of a statute must be construed reasonably so as to give effect to the enactment rather than reduce it to a futility. (Interpretatio fienda est ut res magis valeat quam pereat) Hence this rule is called the Rule of Reasonable Construction.
So, while interpreting a law, two meanings are possible, one making the statute absolutely vague and meaningless and other leading to certainty and a meaningful interpretation, in such case the latter interpretation should be followed. (Pratap Singh v State of Jharkhand (2005)3 SCC 551).

• Rule of Harmonious Construction
• Rule of Beneficial Construction
• Rule of Exceptional Construction
• Rule of Ejusdem Generis

Secondary Rules

• Effect of usage
• Associated Words to be Understood in Common Sense Manner

Note: Answers highlighted in Green are right answers.

51. What Statute is an aid in the interpretation of Statutes?

a. General Clauses Act, 1897
b. Interpretation of Statutes Act, 1897
c. Law of Legislations, 1897
d. All of the above

52. While applying the literal rule of interpretation, it is important to keep in mind the:

a. language
b. theme
c. context
d. applicability

53. Illustration: While interpreting a statute, one has internal and external aids to construction. Question: Which of the following in not an Internal aid to construction?

a. long title
b. preamble
c. headings
d. definitions
e. Parliamentary history

54. Delegatus non potest delegare

a. Debtor follows the person of the debtor
b. An action does not arise from a bare promise
c. A delegated power cannot be further delegated
d. The law does not concern itself with trifling matters

55. expressumn facit cessare tacitum

a. Private disadvantage is counter balanced by public good.
b. The reason of a decision.
c. An action does not arise from a bare promise
d. express mention of one person or thing is exclusion of another.

56. Generalia specialibus non derogant

a. The king can do no wrong.
b. general things do not derogate from special things.
c. The land passes with its burdens.
d. An accessory follows the principal.

57. Utres valet potior quam pareat.

a. it may rather become operative than null.
b. A matter adjudged is taken for truth.
c. An accessory follows the principal.
d. The land passes with its burdens.

58. Expressum facit cessare tacitum.

a. Private disadvantage is counter balanced by public good.
b. what is expressed makes what is implied to cease.
c. An accessory follows the principal.
d. A matter adjudged is taken for truth.

59. Judicium simper pro veritate accipitur

a. A judgment always accepted as true
b. A judgment pronounced by a judge to decide in a matter falling within his jurisdiction is of no effect
c. In equal delict, the position of the defender is the stronger
d. The immediate and not the remote cause is to be considered

60. Supreme Courts precedent in binding on

a. Courts
b. Appellate Tribunals
c. Income Tax Authorities
d. All of the above.

61. In which of the following cases free and fair election is recognized as basic structure of Indian Constitution?

a. Indira Gandhi V- Raj Narayan
b. Minerva Mills V- Union of India
c. Both (A) and (B) above
d. None of the above

62. Doctrine of Separation of Powers was systematically formulated by

a. Plato
b. Montesquieu
c. Dicey
d. Aristotle

63. ‘Rule of Law’ means

a. Supremacy of Judiciary
b. Supremacy of Law
c. Equality before Law
d. Supremacy of Parliament

64. Which one of the following statement is true?

a. Delegated legislation cannot have retrospective effect-
b. Delegated legislation can have retrospective effect, if authorized by Act or Statute-
c. Delegated legislation can have retrospective effect, if not authorized by Act or Statute but have reasonable and rational justification-
d. None of the above-

65. Which of the following interpretations of the Constitution regarding the utility of Directives is/are found to be correct?
I. Even though the implementation of a Directive Principle may cause hardship to a few individuals, it should be upheld in the larger interests of the community.
II. In view of the absolute prohibition of consumption of liquor in Article 47, there cannot be any fundamental right to manufacture and sell intoxicating liquor.

a. I and II
b. Neither I nor II
c. Only I
d. Only II

66. The legislative process includes the process of implementing and enforcing the law once made.

a True
b False

67. Which of the following statements accurately capture Dicey’s view on the limitations which exist on Parliament’s law-making powers?

a. Parliament’s law-making powers are subject to external and internal political limits.
b. Parliament’s law-making powers are not subject to any limits.
c. Parliament’s law-making powers are subject to legal limitations.
d. Parliament’s law-making powers are subject to legal and political limitations.

68. who is the final answer to interpret the constitution

a. The President
b. The Parliament
c. The lok Sabha
d. The Supreme Court

69. The power of Supreme Court to decide the dispute between the centre and the states falls under its

a. Advisory Jurisdiction
b. Appellate Jurisdiction
c. Original Jurisdiction
d. Advisory and appellate Jurisdiction

70. When may judges apply the golden rule?

a. When the mischief rule can’t be applied
b. In the same circumstances as the purposive approach
c. When applying the literal would be unfair
d. When applying the literal rule leads to an absurd or repugnant result

Here are the some multi-choice questions enlisted for preparation for Pre Examination online Test, E-Learning ICAI & LAWs Law Examination. These Multi-choice questions or MCQs can help you in your CS & CA and other law related exams. We have also provided Online exam solved answers for your preparation.

71. Formal legal document which creates or confirms a right or record a fact is a—
(a) Document
(b) Deed
(c) Statute
(d) Instrument

72. Which among the following is the cardinal rule of construction of statutes—
(a) Harmonious Rule of construction
(b) Beneficial Rule of construction
(c) Literal Rule of construction
(d) Reasonable Rule of construction

73. Rule of Reasonable Construction is based on the maxim—
(a) Absolut asentenia expositor non indigent
(b) Ut res magis valeat quam pareat
(c) Quo facit per alium facit per se
(d) contemporanea expositio

74. Rule of Beneficial construction is also known as—
(a) Purposive construction
(b) Mischieve Rule
(c) Heydons’s Rule
(d) All of the Above

75. Pick the odd one out of the following aids to interpretation—
(a) Preamble
(b) Marginal Notes
(c) Proviso
(d) Usage

76. Which rule of construction is applicable where there is a real and not merely
apparent conflict between the provisions of an Act, and one of them has not
been made subject to the other—
(a) Rule of Beneficial construction
(b) Rule of Literal construction
(c) Rule of Harmonious construction
(d) Rule of Exceptional construction

77. An internal aid that may be added to include something within the section
or to exclude something from it, is—
(a) Proviso
(b) Explanation
(c) Schedule
(d) Illustrations

78. An aid that expresses the scope, object and purpose of the Act—
(a) Title of the Act
(b) Heading of the Chapter
(c) Preamble
(d) Definitional sections

Question and Answer

Question 1: Explain the rule of ‘beneficial construction’ while interpreting the statutes quoting an example.

Answer: Where the language used in a statute is capable of more than one interpretation,
the most firmly established rule for construction is the principle laid down in the Heydon’s case.

This rule enables, consideration of four matters in constituting an act :
(1) what was the law before making of the Act,
(2) what was the mischief or defect for which the law did not provide,
(3) what is the remedy that the Act has provided, and
(4) what is the reason for the remedy.

The rule then directs that the courts must adopt that construction which ‘shall suppress the mischief and advance the remedy’. Therefore even in a case wherethe usual meaning of the language used falls short of the whole object of the legislature, a more extended meaning may be attributed to the words, provided they are fairly susceptible of it.

If the object of any enactment is public safety, then its working must be interpreted widely to give effect to that object. Thus in the case of Workmen’s Compensation Act, 1923 the main object being provision of compensation to workmen, it was held that the Act ought to be so construed, as far as possible, so as to give effect to its primary provisions.

However, it has been emphasized by the Supreme Court that the rule in Heydon’s case is applicable only when the words used are ambiguous and are reasonably capable of more than one meaning [CIT v. Sodra Devi (1957) 32 ITR 615 (SC)].

Question 2: Explain the principles of “Grammatical Interpretation” and “Logical Interpretation” of a Statute. What are the duties of a court in this regard?

Answer: Principles of Grammatical Interpretation and Logical Interpretation: In order
to ascertain the meaning of any law/ statute the principles of Grammatical and Logical Interpretation is applied to conclude the real meaning of the law and the intention of the legislature behind enacting it.

Meaning: Grammatical interpretation concerns itself exclusively with the verbal expression of law. It does not go beyond the letter of the law, whereas Logical interpretation on the other hand, seeks more satisfactory evidence of the true intention of the legislature.
Application of the principles in the court:

In all ordinary cases, the grammatical interpretation is the sole form allowable. The court cannot delete or add to modify the letter of the law. However, where the letter of the law is logically defective on account of ambiguity, inconsistency or incompleteness, the court is under a duty to travel beyond the letter of law so as to determine the true intentions of the legislature. So that a statute is enforceable at law, however, unreasonable it may be. The duty of the court is to administer the law as it stands rather it is just or unreasonable.

However, if there are two possible constructions of a clause, the courts may prefer the logical construction which emerges from the setting in which the clause appears and the circumstances in which it came to be enacted and also the words used therein.

Question 3: What is the effect of proviso? Does it qualify the main provisions of an
Enactment?

Answer :Normally a Proviso is added to a section of an Act to except something or qualify something stated in that particular section to which it is added. A proviso should not be, ordinarily, interpreted as a general rule. A proviso to a particular section carves out an exception to the main provision to which it has been enacted as a Proviso and to no other provision. [Ram Narian Sons Ltd. Vs. Commissioner of Sales Tax AIR (1955) S.C. 765]

Question 4: Does an explanation added to a section widen the ambit of a section?

Answer: Sometimes an explanation is added to a section of an Act for the purpose of
explaining the main provisions contained in that section. If there is some ambiguity in the provisions of the main section, the explanation is inserted to harmonise and clear up and ambiguity in the main section. Something may added be to or something may be excluded from the main provision by insertion of an explanation. But the explanation should not be construed to widen the ambit of the section.

Question 5: Gaurav Textile Company Limited has entered into a contract with a Company. You are invited to read and interpret the document of contract. What rules of interpretation of deeds and documents would you apply while doing so?
Answer: The rules regarding interpretation of deeds and documents are as follows :
First and the foremost point that has to be borne in mind is that one has to find out what reasonable man, who has taken care to inform himself of the surrounding circumstances of a deed or a document, and of its scope and intendments, would understand by the words used in that deed or document.

It is inexpedient to construe the terms of one deed by reference to the terms of another. Further, it is well established that the same word cannot have two different meanings in the same documents, unless the context compels the
adoption of such a rule.

The Golden Rule is to ascertain the intention of the parties of the instrument after considering all the words in the documents/deed concerned in their ordinary, natural sense. For this purpose, the relevant portions of the document have to be considered as a whole. The circumstances in which the particular words have been used have also to be taken into account.

Very often, the status and training of the parties using the words have also to be taken into account as the same words maybe used by a ordinary person in one sense and by a trained person or a specialist in quite another sense and a special sense. It has also to be considered that very many words are used in more than one sense. It may happen that the same word understood in one sense will give effect to all the clauses in the deed
while taken in another sense might render one or more of the clauses ineffective.

In such a case the word should be understood in the former and not in the latter
sense. It may also happen that there is a conflict between two or more clauses of the
same documents. An effect must be made to resolve the conflict by interpreting the clauses so that all the clauses are given effect. If, however, it is not possible to give effect of all of them, then it is the earlier clause that will override the latter one.

Question 5:How will you interpret the definitions in a statute, if the following words are used in a statute?
(i) Means, (ii) Includes Give one illustration for each of the above from statutes you are familiar with.

Answer: Interpretation of the words “Means” and “Includes” in the definitions- The definition of a word or expression in the definition section may either be restricting of its ordinary meaning or may be extensive of the same.

When a word is defined to ‘mean’ such and such, the definition is ‘prima facie’ restrictive and exhaustive, we must restrict the meaning of the word to that given in the definition section.
But where the word is defined to ‘include’ such and such, the definition is ‘prima facie’ extensive, here the word defined is not restricted to the meaning assigned to it but has extensive meaning which also includes the meaning assigned to it in the definition section.

Example— Definition of Director [section 2(34) of the Companies Act, 2013]—Director meansa director appointed to the board of a company. The word “means” suggests exhaustive definition.

Definition of Whole time director [Section 2(94) of the Companies Act, 2013]— Whole time director includes a director in the whole time employment of the company. The word “includes” suggests extensive definition. Other directors may be included in the category of the whole time director.

Question 6: Differentiate Mandatory Provision from a Directory Provision. What factors decide whether a provision is directory or mandatory?

Answer: Practically speaking, the distinction between a provision which is ‘mandatory’ and
one which is ‘directory’ is that when it is mandatory, it must be strictly observed; when it is ‘directory’ it would be sufficient that it is substantially complied with.

However, we have to look to the substance and not merely the form, an enactment in mandatory form might substantially be directory and, conversely, a statute in directory form may in substance be mandatory. Hence, it is the substance that counts and must take precedence over mere form.

If a provision gives a power coupled with a duty, it is mandatory: whether it is or is not so would depend on such consideration as:
− the nature of the thing empowered to be done,
− the object for which it is done, and
− the person for whose benefit the power is to be exercised.

Question 7: Define Grammatical Interpretation. What are the exceptions to grammatical interpretation?

Answer: Grammatical Interpretation and its exceptions: ‘Grammatical interpretation’ concerns itself exclusively with the verbal expression of the law, it does not go beyond the letter of the law. In all ordinary cases, ‘grammatical interpretation’ is the sole form allowable. The Court cannot take from or add to modify the letter of the law. This rule, however, is subject to some exceptions:

(i) Where the letter of the law is logically defective on account of ambiguity, inconsistency or incompleteness. As regard the defect to ambiguity, the Court is under a duty to travel beyond the letter of the law so as to determine from the other sources the true intention of the legislature. In the case of the statutory expression being defective on account of inconsistency, the court must ascertain the spirit of the law.

(2) If the text leads to a result which is so unreasonable that it is self-evident that the legislature could not mean what it says, the court may resolve such impasse by inferring logically the intention of the legislature.

Question 8: Write short note on:
(i) Provision
(ii) Explanation,
with reference to interpretation of Statutes, Deeds and Documents.

Answer: (i) Proviso: The normal function of a proviso is to except something out of the
enactment or to qualify something stated in the enactment which would be within its purview if the proviso were not there. The effect of the proviso is to qualify the preceding enactment which is expressed in terms which are too general.

As a general rule, a proviso is added to an enactment to qualify or create an exception to what is in the enactment. Ordinarily a proviso is not interpreted as stating a general rule. It is a cardinal rule of interpretation that a proviso to a particular provision of a statute only embraces the field which is covered by the main provision.

(ii) Explanation: An Explanation is at times appended to a section to explain the meaning of the text of the section. An Explanation may be added to include something within the section or to exclude something from it. An Explanation should normally be so read as to harmonise with and clear up any ambiguity in the main section. It should not be so construed as to widen the ambit of the section. The meaning to be given to an explanation will really depend upon its terms and not on any theory of its purpose.

Question 9: Explain ‘Mischieve Rule’ for interpretation of statute. Also, give four matters it considers in construing an Act.
Answer: Mischieve Rule: Where the language used in a statute is capable of more than
one interpretation, principle laid down in the Heydon’s case is followed. This is known as ‘purposive construction’ or ‘mischieve rule’.

The rule then directs that the courts must adopt that construction which ‘shall suppress the mischief and advance the remedy’. It has been emphasized by the Supreme Court that the rule in Heydon’s case is applicable only when the words used are ambiguous and are reasonably capable of more than one meaning.

It enables consideration of four matters in construing an Act:
(1) what was the law before the making of the Act;
(2) what was the mischief or defect for which the law did not provide;
(3) what is the remedy that the Act has provided; and
(4) what is the reason for the remedy.

Question 10: Explain how ‘Dictionary Definitions’ can be of great help in interpreting / constructing an Act when the statute is ambiguous.
Answer: Dictionary Definitions: First we refer the Act in question to find out if any particular word or expression is defined in it. Where we find that a word is not defined in the Act itself, we may refer to dictionaries to find out the general sense in which that word is commonly understood.

However, in selecting one out of the several meanings of a word, we must always take into consideration the context in which it is used in the Act. It is the fundamental rule that the meanings of words and expressions used in an Act must take their colour from the context in which they appear. Further, judicial decisions laying down the meaning of words in construing statutes in pari materia will have greater weight than the meaning furnished by dictionaries. However, for technical terms, reference may be made to technical dictionaries.

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Note: Answers highlighted in Green are right answers.

51. What Statute is an aid in the interpretation of Statutes?

a. General Clauses Act, 1897
b. Interpretation of Statutes Act, 1897
c. Law of Legislations, 1897
d. All of the above

52. While applying the literal rule of interpretation, it is important to keep in mind the:

a. language
b. theme
c. context
d. applicability

53. Illustration: While interpreting a statute, one has internal and external aids to construction. Question: Which of the following in not an Internal aid to construction?

a. long title
b. preamble
c. headings
d. definitions
e. Parliamentary history

54. Delegatus non potest delegare

a. Debtor follows the person of the debtor
b. An action does not arise from a bare promise
c. A delegated power cannot be further delegated
d. The law does not concern itself with trifling matters

55. expressumn facit cessare tacitum

a. Private disadvantage is counter balanced by public good.
b. The reason of a decision.
c. An action does not arise from a bare promise
d. express mention of one person or thing is exclusion of another.

56. Generalia specialibus non derogant

a. The king can do no wrong.
b. general things do not derogate from special things.
c. The land passes with its burdens.
d. An accessory follows the principal.

57. Utres valet potior quam pareat.

a. it may rather become operative than null.
b. A matter adjudged is taken for truth.
c. An accessory follows the principal.
d. The land passes with its burdens.

58. Expressum facit cessare tacitum.

a. Private disadvantage is counter balanced by public good.
b. what is expressed makes what is implied to cease.
c. An accessory follows the principal.
d. A matter adjudged is taken for truth.

59. Judicium simper pro veritate accipitur

a. A judgment always accepted as true
b. A judgment pronounced by a judge to decide in a matter falling within his jurisdiction is of no effect
c. In equal delict, the position of the defender is the stronger
d. The immediate and not the remote cause is to be considered

60. Supreme Courts precedent in binding on

a. Courts
b. Appellate Tribunals
c. Income Tax Authorities
d. All of the above.

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