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You definitely don’t need a valid passport to move forward with H&C stage 2 (after AIP). When you submit your documents for stage 2, you need to include a cover letter to explain why you can’t provide a valid passport and request an exemption. I had the same situation when I submitted my documents for final approval, my passport was expired and with CBSA.
Can you please give me Format of cover letter.
 
My lawyer is misguiding me on same thing .my passport is expired and seized at CBSA. My lawyer told me to give valid passports. Where I have to send mail for exemption.please help
Send the request for exemption to the office that your aip came from.
 
It's written in your AIP.
And their email address is included as well, so that you can forward all the required documents for stage 2 processing.
Iam very confused they send me only approval letter .they have not requested for any documents.My lawyer said me they will send you letter again in the meantime prepare your documents Like PCC and passport .