The NCLT on Tuesday adjourned its hearing over a petition filed by Sanjay Singhal, former promoter of debt-ridden Bhushan Power & Steel Ltd (BPSL), to June 26. Singhal has approached the National Company Law Tribunal (NCLT), seeking enforcement of the order passed by the Supreme Court, which had on May 2 quashed the Rs 19,700 crore resolution plan from Sajjan Jindal-led JSW Steel.
Setting aside the previous order passed by the tribunal, the apex court had directed initiation of liquidation of BPSL, as per the provisions of the Insolvency & Bankruptcy Code.
Following this, Singhal moved NCLT to place on record the judgment order of the Supreme Court and its implementation.
The matter was listed before the Delhi-based Principal bench of the NCLT, where a two-member bench comprising its president adjourned the matter to June for the next hearing.
However, NCLT took the judgment passed by the Supreme Court on BPSL on record.
During the proceedings of the NCLT, Solicitor General of India Tushar Mehta, appearing for the government, said that there are several stakeholders in this matter.
He suggested that all parties are required to be heard in this matter by the insolvency tribunal and suggested granting time to identify them and make a party in this by impleading them.
Mehta further said that various stakeholders are considering their options after this Supreme Court ruling, including a fresh CIRP (Corporate Insolvency Resolution Process) for BPSL.
This was accepted by the NCLT bench, following which the hearing was adjourned.
CIRP was initiated against BPSL in July 2017 after admitting the plea of public sector lender Punjab National Bank. It was among the first list of 12 NPA or bad loan cases identified by the Reserve Bank of India in 2017.
In February 2020, the National Company Law Appellate Tribunal allowed JSW Steel to acquire BPSL for Rs 19,700 crore by providing it immunity from prosecution by the Enforcement Directorate.
The ED had attached assets worth over Rs 4,025 crore of BPSL in connection with its money laundering probe linked to an alleged bank loan fraud by its former promoters.
The appellate tribunal had on October 14 directed the ED to immediately release the confiscated assets of BPSL in favour of the resolution professional of the debt-ridden firm.
These orders were challenged before the Supreme Court.
On May 2, the Supreme Court in its order had criticised multiple stakeholders, including the successful resolution applicant (SRA) JSW Steel for procedural lapses and failure to uphold the objectives of the IBC.
Almost three years after the implementation of the resolution plan, the apex court has directed return of money by the financial and operational creditors.
It held that the Committee of Creditors (Coc) failed to exercise its commercial wisdom while approving JSW's resolution plan, which was in absolute contravention of the mandatory provisions of the IBC and CIRP regulations.
The verdict declared the NCLT orders of September 5, 2019 and the NCLAT judgment of February 17, 2022, as "perverse" and lacking jurisdiction, and consequently, set those aside.
The bench rejected the resolution plan of JSW, as approved by the CoC, for being non-compliant with the IBC.
NCLT was subsequently directed to initiate liquidation proceedings against BSPL under section 33(1) of the IBC, exercising the court's powers under Article 142 of the Constitution.
The top court said the CoC should not have accepted the resolution plan.
Setting aside the previous order passed by the tribunal, the apex court had directed initiation of liquidation of BPSL, as per the provisions of the Insolvency & Bankruptcy Code.
Following this, Singhal moved NCLT to place on record the judgment order of the Supreme Court and its implementation.
The matter was listed before the Delhi-based Principal bench of the NCLT, where a two-member bench comprising its president adjourned the matter to June for the next hearing.
However, NCLT took the judgment passed by the Supreme Court on BPSL on record.
During the proceedings of the NCLT, Solicitor General of India Tushar Mehta, appearing for the government, said that there are several stakeholders in this matter.
He suggested that all parties are required to be heard in this matter by the insolvency tribunal and suggested granting time to identify them and make a party in this by impleading them.
Mehta further said that various stakeholders are considering their options after this Supreme Court ruling, including a fresh CIRP (Corporate Insolvency Resolution Process) for BPSL.
This was accepted by the NCLT bench, following which the hearing was adjourned.
CIRP was initiated against BPSL in July 2017 after admitting the plea of public sector lender Punjab National Bank. It was among the first list of 12 NPA or bad loan cases identified by the Reserve Bank of India in 2017.
In February 2020, the National Company Law Appellate Tribunal allowed JSW Steel to acquire BPSL for Rs 19,700 crore by providing it immunity from prosecution by the Enforcement Directorate.
The ED had attached assets worth over Rs 4,025 crore of BPSL in connection with its money laundering probe linked to an alleged bank loan fraud by its former promoters.
The appellate tribunal had on October 14 directed the ED to immediately release the confiscated assets of BPSL in favour of the resolution professional of the debt-ridden firm.
These orders were challenged before the Supreme Court.
On May 2, the Supreme Court in its order had criticised multiple stakeholders, including the successful resolution applicant (SRA) JSW Steel for procedural lapses and failure to uphold the objectives of the IBC.
Almost three years after the implementation of the resolution plan, the apex court has directed return of money by the financial and operational creditors.
It held that the Committee of Creditors (Coc) failed to exercise its commercial wisdom while approving JSW's resolution plan, which was in absolute contravention of the mandatory provisions of the IBC and CIRP regulations.
The verdict declared the NCLT orders of September 5, 2019 and the NCLAT judgment of February 17, 2022, as "perverse" and lacking jurisdiction, and consequently, set those aside.
The bench rejected the resolution plan of JSW, as approved by the CoC, for being non-compliant with the IBC.
NCLT was subsequently directed to initiate liquidation proceedings against BSPL under section 33(1) of the IBC, exercising the court's powers under Article 142 of the Constitution.
The top court said the CoC should not have accepted the resolution plan.
