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

The Adjudicating Authority approves the resolution plan for Kaveri Steels Ltd under section 31(1). Which consequence follows directly from section 31(3) after the order of approval?

After approval under section 31(1), the section 14 moratorium ceases to have effect, and the resolution professional must forward all CIRP records and the resolution plan to the Insolvency and Bankruptcy Board of India to be recorded on its database.

  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 the CIRP records and the plan to the Board for its databaseCorrect
  3. CThe resolution professional must file the records with the Competition Commission of India
  4. DThe CIRP records are destroyed and the Board is only informed of the plan's value

Explanation

Section 31(3) provides that after the approval order the section 14 moratorium ceases to have effect, and the resolution professional forwards all records relating to the CIRP and the plan to the Board to be recorded on its database. The option saying the moratorium continues is wrong since it ceases on approval.

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