New Delhi: The National Court Tribunal (NCLT) on Tuesday delayed the bankruptcy of Bhushan Power & Steel Ltd (BPSL) until May 30, when directives were expected to be issued to a request from former promoter Sanjay Singal.
Singal’s plea seeks execution of the Supreme Court on May 2, which is a resolution plan of Rs 197 billion” ₹1970 billion resolution plans and directed NCLT to initiate liquidation procedures.
The adjournment follows the request of Tushar Mehta, a lawyer representing the coalition government and other stakeholders, to avoid any notice. He urged the bench to allow Singal to identify and approve all necessary parties before formally hearing the matter.
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Meta told the bench: “Let him (single) consider who he wants to join, and who is the necessary party before even sending the notice, we can send it thereafter.”
The NCLT President, led by Justice R. Sudhakar, agreed to Mehta’s submission and directed Singal’s attorney to place all relevant stakeholders before the next hearing.
“So all of you should think about it. Yes. We can’t make a decision,” the bench said.
During the NCLT hearing, Mehta said stakeholders are considering various legal options for the Supreme Court ruling, including seeking the BPSL’s new corporate bankruptcy settlement process (CIRP).
“Every option is being considered because it will have to be clarified by the court of honors,” Mehta said. He added: “We can even convince the court to initiate a new CIRP process because the ultimate goal of IBC is to preserve the company as a constant concern. The liquidation is the ultimate death.”
Mehta also raised concerns about BPSL assets, which have been attached to the Law Enforcement Bureau (ED) under the Money Laundering Act (PMLA).
He reminded the court that IBC Article 32A was introduced to protect solution applicants from past criminal debts once the solution plan was approved. Mehta said that with the resolution plan now invalidates, there are some issues regarding whether ED attachments can survive and whether those assets can be included in liquidation.
“Now, with the shelving of the resolution plan, even these ED attachments can be restored. There is also a broader question: can property be attached according to different regulations, according to the liquidation process?” Mehta noted.
Meanwhile, Singal’s lawyers urged the court to appoint someone to control the company’s assets to prevent potential abuse or transfer. The lawyer proposes: “Someone must be appointed to control the assets to prevent siphons.”
NCLT said it will consider all submissions and issuance instructions on May 30.
On February 2, the Supreme Court’s ruling overturned a plan of full implementation of resolution five years after approval by the NCLT and the Creditors Committee, which had already produced shock waves through India’s breaking ecosystem.
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The judgment also brought financial setbacks to lenders. The bank must now return it ₹According to the resolution plan, Rs 19,350 crore was obtained from JSW Steel. However, the recovery rate for liquidation in the mid-lossal is expected to be significantly lower, forcing banks to obtain new supply hits, especially when public sector banks face margin pressures and potential declines in fiscal 26.
BPSL is one of the top 12 major offenders identified by the Reserve Bank of India under the Bankruptcy and Bankruptcy Act in 2017, owing money ₹472 billion.
