Govt preparing response to SC verdict on ₹19,700 cr JSW-Bhushan Power deal

The Centre is reviewing the Supreme Court’s order that quashed JSW Steel’s ₹19,700 crore resolution plan of Bhushan Power and Steel Ltd (BPSL), and will soon finalise its response, the Department of Financial Services (DFS) said on Monday, according to a report by Reuters.

“I have already reviewed [the order] with all the lenders. We have taken a position, we have studied the judgment, we have got our advocates’ view on the judgment,” DFS Secretary M Nagaraju said. “Now we are taking a view in the government on how we approach the judgment. We will finalise soon.”

Supreme Court rejects JSW Steel's resolution plan

On April 2, the Supreme Court rejected JSW Steel’s resolution plan of BPSL under the corporate insolvency resolution process (CIRP), ordering instead the liquidation of the debt-laden company. The top court set aside earlier rulings by the National Company Law Tribunal (NCLT) and the National Company Law Appellate Tribunal (NCLAT) that had approved JSW’s resolution plan.

In its judgment, the bench said the approved plan did not conform to sections 30(2) and 31(2) of the Insolvency and Bankruptcy Code (IBC). “The Resolution Plan of JSW as approved by the CoC [Committee of Creditors] stands rejected,” the court said, adding that liquidation proceedings should be initiated by the NCLT under its suo motu powers granted by Article 142 of the Constitution.

JSW Steel acquired BPSL in 2021 under IBC

JSW Steel had acquired BPSL in March 2021 under the IBC framework. The acquisition was seen as a key strategic move for the steelmaker, giving it a manufacturing foothold in Odisha and eastern India. The unexpected reversal by the court has now thrown the future of the asset and its creditors into uncertainty.

The DFS is expected to consult with lenders, legal experts, and possibly the Insolvency and Bankruptcy Board of India (IBBI) before determining whether further legal or legislative steps might be taken.