Regulation 40 - Detection of Fraud or Insolvency - Insolvency and Bankruptcy Board of India (Voluntary Liquidation Process) Regulations, 2017

Detection of Fraud or Insolvency 40. (1) Where the liquidator is of the opinion that the liquidation is being done to defraud a person, he shall make an application to the Adjudicatory Authority to suspend the process of liquidation and pass any such orders as it deems fit. (2) Where the liquidator is of the opinion that the corporate person will not be able to pay its debts in full from the proceeds of assets to be sold in the liquidation, he shall make an application to the Adjudicating Authority to suspend the process of liquidation and pass any such orders as it deems fit.