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

Kaveri Textiles Ltd's resolution plan was approved by the Adjudicating Authority by an order under section 31(1). Which of the following follows immediately after that order?

After approval under section 31(1), the section 14 moratorium ceases to have effect, and the resolution professional must send all records of the insolvency process and the plan to the Board for recording on its database. The moratorium does not survive until implementation or until further approvals are obtained.

  1. AThe moratorium under section 14 continues until the plan is fully implemented
  2. BThe moratorium under section 14 ceases to have effect, and the resolution professional forwards all CIRP records and the plan to the Board to be recorded on its databaseCorrect
  3. CThe resolution professional must file the plan with the Competition Commission of India for the first time
  4. DThe moratorium ceases only after the resolution applicant obtains all other legal approvals

Explanation

Under section 31(3), after approval the section 14 moratorium ceases to have effect and the resolution professional forwards all records of the CIRP and the plan to the Board for its database. The moratorium does not continue until implementation or until other approvals are obtained. Any Competition Commission approval for a combination must come before the committee of creditors approves the plan, so it is not a first-time filing at this stage.

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