Mumbai University Solved Question Papers
Bankruptcy Laws
Previous Year Question Paper with Solution
LLB 3 years · Sem 4
May 2026 - 60/40 Examination
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LLB 3 years Sem 4 Bankruptcy Laws May 2026 - 60/40 Question Paper with Solutions
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First published on munotes.in on 24 October 2026.
Published by munotes.in, Mumbai.
Model answers written and edited by the munotes.in editorial desk.
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The University does not publish an official answer key for this paper. The answers in this volume are model answers, written to show how a full-mark answer is built. They are a study aid, not an authority on what an examiner marked.
The question paper reproduced here is the paper as set by the University of Mumbai at the May 2026 - 60/40 examination.
Contents
The questions below are the paper as the University of Mumbai set it at the May 2026 - 60/40 examination, in the order it was set.
MarksPage
MarksPage
The Paper as Set
The questions in this volume are the questions asked at the May 2026 - 60/40 examination, reproduced as the University of Mumbai set them, in the order it set them. Nothing has been reworded, added or left out. Only the answers are ours. See the original question paper.
Duration 2 hours · Total marks 60 · 22 questions answered
Instructions printed on the paper
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How to use this volume
Solve the paper first, under exam conditions and against the clock. Then read the answers here and mark your own. Reading a solution before attempting the question feels productive and teaches very little, because recognising an answer is not the same as being able to write one.
Q.1
Q.1: Answer any six of the following
12 Marks - 2 marks each
(a)What is a 'Default' as per the I.B.C?[2]
Answer
Section 3(12) defines default as non-payment of debt when whole or any part or instalment of the amount of debt has become due and payable and is not paid by the debtor or the corporate debtor.
The definition has four parts.
- There must be a debt, that is, a liability in respect of a claim (sections 3(11) and 3(6)).
- The debt, or a part or an instalment of it, must be due and payable. A debt not yet due cannot be in default.
- It must not have been paid. The word was "repaid" until 2018, when it became "paid".
- Non-payment of even one instalment is enough.
Why it matters. Default is the trigger for every process. A financial creditor, an operational creditor or the company itself may start a CIRP when "any corporate debtor commits a default" (section 6). Part II applies only where the default is at least one crore rupees (section 4).
The leading case. In Innoventive Industries Ltd. v. ICICI Bank (2018) 1 SCC 407 the Supreme Court held that on a financial creditor's application the NCLT asks only whether a default has occurred. It looks at the records of an information utility or other evidence. The debtor may show that the debt is not due in law or in fact. Once default is shown, the application must be admitted if it is complete. Since 26 May 2026 section 7(5) says so in terms.
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