IBC 2016 Section 4, 6, 7 Quick understanding
(a) Initiation of corporate insolvency resolution process by financial creditor.
(i) Filing of application before adjudicating authority: A financial creditor either by
itself or jointly with other financial creditors may file an application for initiating
corporate insolvency resolution process against a corporate debtor before the
Adjudicating Authority when a default has occurred.
A default includes a default in respect of a financial debt owed not only to the applicant
financial creditor but to any other financial creditor of the corporate debtor.
(ii) Furnishing of information: The financial creditor shall, along with the application
furnish—
(a) record of the defaultthe name of the resolution professional proposed to act as an interim
resolution professional; and
(c) any other information as may be specified by the Board.
(iii) Time period for determination of default: The Adjudicating Authority shall, within
fourteen days of the receipt of the application, ascertain the existence of a default
from the records of information utility or on the basis of other evidence furnished by
the financial creditor.
(iv) Order: Where the Adjudicating Authority is satisfied that—
(a) a default has occurred and the application is complete and there is no
disciplinary proceeding pending against the proposed resolution professional, it
may, by order, admit such application; or
(b) default has not occurred or the application is incomplete or any disciplinary
proceeding is pending against the proposed resolution professional, it may, by
order, reject such application:
Provided that the Adjudicating Authority shall, before rejecting the application, give a
notice to the applicant to rectify the defect in his application within seven days of
receipt of such notice from the Adjudicating Authority.
(v) Commencement of corporate insolvency resolution process: The corporate
insolvency resolution process shall commence from the date of admission of the
application.
(vi) Communication of Order: The Adjudicating Authority shall communicate—
(1) the order to the financial creditor and the corporate debtor;
(2) the order to the financial creditor, within seven days of admission or rejection of
such application, as the case may be. [Section 7]