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CS Professional · Corporate Restructuring, Valuation and Insolvency · Preparation and Approval of Resolution Plan

A resolution plan for Kaveri Textiles Ltd has been approved by the committee of creditors. The members want the plan's implementation to be supervised after approval. Under Regulation 38 of the IBBI (Insolvency Resolution Process for Corporate Persons) Regulations, 2016, which statement is correct?

The committee shall consider setting up a monitoring committee to supervise implementation, and that monitoring committee must submit quarterly reports to the Adjudicating Authority on the status of implementation. It is not compulsory to appoint the resolution professional, and reporting is not monthly to the Board.

  1. AThe committee shall consider setting up a monitoring committee, and the monitoring committee must submit quarterly reports to the Adjudicating Authority on the status of implementationCorrect
  2. BThe committee must always appoint the resolution professional as the sole monitoring committee member, with an enhanced fee
  3. CThe monitoring committee must submit monthly reports to the Insolvency and Bankruptcy Board of India
  4. DThe committee has no role in monitoring because supervision is left entirely to the Adjudicating Authority

Explanation

Regulation 38(4) says the committee shall consider setting up a monitoring committee, and the monitoring committee shall submit quarterly reports to the Adjudicating Authority. The RP is not mandatory, and reports go to the Adjudicating Authority, not monthly to the Board.

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