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The Supreme Court further directed the National Company Law Tribunal to initiate liquidation proceedings against BPSL.
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SHASHI SHEKHAR KASHYAP
The Supreme Court, in a judgment, on Friday rejected the resolution plan submitted by JSW Steel for Bhushan Power and Steel Ltd (BPSL).
The National Company Law Appellate Tribunal had previously approved the resolution plan.
“The judgment passed by the NCLAT in allowing the company appeal of JSW and issuing the directions without any authority of law and without jurisdiction is perverse, coram non judice and liable to be set aside,” a Bench headed by Justice Bela M. Trivedi said.
The court found the resolution plan in “flagrant violation and contravention” of the law.
“The Resolution Professional had utterly failed to discharge his statutory duties contemplated under the Insolvency and Bankruptcy Code (IBC) and the Corporate Insolvency Resolution Process (CIRP) Regulations during the course of entire CIR proceedings of the corporate debtor, BPSL,” the Supreme Court concluded.
The court invoked its inherent powers under Article 142 of the Constitution to direct the National Company Law Tribunal to initiate liquidation proceedings against the BPSL under the IBC and in accordance with the law.
COC faulted
The court faulted the Committee of Creditors (CoC) for accepting the resolution plan. The court further directed the National Company Law Tribunal to initiate liquidation proceedings against BPSL.
“The CoC had failed to exercise its commercial wisdom while approving the Resolution Plan of the JSW, which was in absolute contravention of the mandatory provisions of IBC and CIRP Regulations. The CoC also had failed to protect the interest of the creditors by taking contradictory stands before this court, and accepting the payments from JSW without any demurrer, and supporting JSW to implement its ill-motivated plan against the interest of the creditors,” Justice Trivedi held.
Yet to get order: JSW
In a statement, JSW Steel Spokesperson said they have “learnt that the Hon’ble Supreme Court pronounced judgment on May 2 rejecting the Resolution Plan approved by NCLAT on certain grounds”. The statement said JSW would decide its future course of action after reviewing the judgment with their legal advisors.
Published on May 2, 2025
This article first appeared on The Hindu Business Line
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