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      Question

      Under Section 7 of the Insolvency and Bankruptcy Code,

      2016, which of the following is NOT a pre-condition for a financial creditor to file an application for initiating the Corporate Insolvency Resolution Process (CIRP)? 
      A The existence of a default in repayment of a financial debt Correct Answer Incorrect Answer
      B The default amount must be at least the prescribed threshold limit Correct Answer Incorrect Answer
      C The financial creditor must be recognized by the Reserve Bank of India Correct Answer Incorrect Answer
      D The application must be filed before the expiry of the limitation period Correct Answer Incorrect Answer
      E The financial creditor must provide evidence of the default to the Adjudicating Authority Correct Answer Incorrect Answer

      Solution

      Section 7 requires a financial creditor to prove the existence of default, the prescribed minimum default amount, provide evidence, and file within the limitation period. Recognition by the RBI is not a pre-condition for filing an application under Section 7 of the IBC Act [Section 7 of IBC, 2016].

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