The BSS stores the Kc and forwards the Set Cipher Mode command to the MS. The CIPH_MOD_CMD only tells the MS which encryption to use (A5/X), no other information is included.
The BSS retains the Kc and transmits the Set Cipher Mode instruction to the MS. The CIPH_MOD_CMD merely instructs the MS on which encryption method (A5/X) to employ, without offering further information.