Section 10. Initiation of corporate insolvency resolution process by corporate applicant. –

(1) Where a corporate debtor has committed a default, a corporate applicant thereof may file an application for initiating corporate insolvency resolution process with the Adjudicating Authority.

(2) The application under sub-section (1) shall be filed in such form, containing such particulars and in such manner and accompanied with such fee as may be prescribed.

¹[(3) The corporate applicant shall, along with the application, furnish-

• (a) the information relating to its books of account and such other documents for such period as may be specified;
• (b) the information relating to the resolution proposed to be appointed as an interim resolution professional; and
• (c) the 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 the application.]

(4) The Adjudicating Authority shall, within a period of fourteen days of the receipt of the application, by an order-

• (a) admit the application, if it is complete ²[and no disciplinary proceeding is pending against the proposed resolution professional]; or
• (b) reject the application, if it is incomplete ³[or any disciplinary proceeding is pending against the proposed resolution professional]: Provided that Adjudicating Authority shall, before rejecting an application, give a notice to the applicant to rectify the defects in his application within seven days from the date of receipt of such notice from the Adjudicating Authority.

(5) The corporate insolvency resolution process shall commence from the date of admission of the application under sub-section (4) of this section.

1. Ins. by Act No. 26 of 2018, sec. 7(a) (w.e.f. 6-6-2018), before substitution the sub clause 3, stood as under –
“(3). The corporate applicant shall, along with the application furnished the information relating to –

• (a) its books of account and such other documents relating to such period as may be specified; and
• (b)the resolution professional proposed to be appointed as an interim resolution professional.”

2.Ins. by Act No. 26 of 2018, sec. 7(b) (i) (w.e.f. 6-6-2018).
3. Ins. by Act No. 26 of 2018, sec. 7(b) (ii) (w.e.f. 6-6-2018).

CASE LAWS

1. Shareholder has a right to approve/disapprove the decision for initiating proceeding u/s 10 of the code. Right under the code does not cease to exist because of a contract or any other condition.

(Reference: NCLAT Order dated 04.12.2018 in the matter of Export-Import Bank of India & Anr Vs. Astonfield Solar (Gujrat) Pvt. Ltd. & Anr. Company Appeal (AT) (Insolvency) No. 754 of 2018)

2. Sec 10 does not empower AA to go beyond the records as mentioned under section 10 and information as required under Form-6 of the AA Rules subject to ineligibility under sec 11 of the code.

(Reference: NCLAT Order dated 01.12.2017 in the matter of Unigreen Global Pvt. Ltd Vs. Punjab National Bank & Ors. Company Appeal (AT)  (Insolvency) No. 81 of 2017)

3. A director not disqualified under sec 164 of the companies Act, 2013, had no authority to file the application.

(Reference: NCLT Order dated 17.09.2020 in the matter of Nessa Infrastructure Ltd. Vs. State Bank of India & Ors. Company Petition (I.B.) 61/10/NCLT/AHM/2018)