New Delhi: The Supreme Court ordered the liquidation of Bhushan Power and Steel Ltd (BPSL) on Friday, rejecting JSW Steel's plan to deal with bankrupt companies.
Supreme Court Rules ₹The resolution plan of 197,000 crore submitted by JSW Steel is illegal and violates the Bankruptcy and Bankruptcy Act (IBC).
The court said the resolution plan should not be approved by the Commission on Creditors (COC) and invoked its extraordinary powers under Article 142 of the Constitution to guide the liquidation of the BPSL.
This marks the second time in recent months (after airlines) that the Supreme Court has ordered the liquidation of a major insolvent company by exercising these constitutional powers.
Wait for detailed order.
JSW Steel proposes payment ₹Rs 1935 billion of financial creditors, totaling nearly 60%, and ₹3.5 billion yuan to operating creditors ₹73.3 billion.
BPSL is one of the 12 large non-performance assets (NPAs) identified by the Reserve Bank of India in 2017, which is one of the bankruptcy solutions under the IBC. At that time, it had more than ₹4.7 billion yuan from lenders and above ₹Operating creditors are 78 billion. The easing of the deal is expected to significantly affect major banks, including the National Bank of India and the National Bank of Punjab, which led the COC in the case.
The law enforcement bureau (ED) has exacerbated the company's troubles by conducting a high-profile investigation of its former salesman ₹40.25 million in bank loans.
In October 2019, under the Money Laundering Act (PMLA), the emergency room accompanied the assets of BPSL, which were identified as proceeds of crime. These attachments are central legal issues in delaying the acquisition process.
In December 2024, the Supreme Court ordered the emergency department to release valued affiliated assets ₹The agency caught Rs 4,000 crore during the investigation. Nevertheless, ED is still arguing that JSW Steel is a stakeholder, citing its minority stake in a separate joint venture with BPSL.
Through this ruling, one of India's longest-running and most-watched bankruptcy cases has ended, although there is no liquidation, not a solution.
