CS Professional · Corporate Restructuring, Valuation and Insolvency · Resolution Strategies

The CoC of Vindhya Steel Ltd has approved a resolution plan in a corporate insolvency resolution process, and the Adjudicating Authority approves it under Section 31(1). Which statement is correct?

The approved plan binds the corporate debtor, employees, members, creditors, guarantors and other stakeholders, including the Central Government, State Governments and local authorities owed statutory dues. This is the effect of Section 31(1), and the moratorium ceases after the approval order.

1. AThe plan binds only the creditors who voted in favour
2. BThe moratorium under section 14 continues until the plan is fully implemented
3. CThe plan binds the corporate debtor, its employees, members, creditors, guarantors and other stakeholders, including Central and State Governments and local authorities owed statutory duesCorrect
4. DThe plan binds only the corporate debtor and the resolution applicant