(FE)
The Supreme Court on Monday ordered a status quo on the liquidation proceedings of Bhushan Power and Steel (BPSL) at the National Company Law Tribunal (NCLT), offering a temporary reprieve to JSW Steel. The apex court’s directive means the NCLT is expected to defer its hearing on the liquidation until a review petition by JSW is filed and considered.
A bench comprising Justices BV Nagarathna and Satish Chandra Sharma directed JSW Steel to submit its review petition before the expiry of the statutory limitation period, ending June 2. The court made it clear that it was not taking a position on the merits of the matter at this stage but noted that proceeding with liquidation could undermine the forthcoming review.
During Monday’s proceedings, senior advocate Neeraj Kishan Kaul, representing JSW Steel, argued that liquidation would cause irreversible harm as BPSL is a profit-making entity. Solicitor General Tushar Mehta, appearing for the CoC, supported a delay, highlighting the complexities of unwinding a resolution plan implemented five years ago, especially with repayments involving foreign banks.
Mehta proposed that the NCLT hearing be scheduled post-June 10, after summer vacations, to allow all parties sufficient time to prepare. He also questioned the standing of Sanjay Singhal, BPSL’s former promoter, who had filed for liquidation.
While acknowledging that the NCLT proceedings were based on the earlier Supreme Court order, the bench emphasised that its current direction was intended to protect the interests of all stakeholders until the legal process surrounding the review petition plays out. It disposed of JSW’s plea by directing a status quo without delving into the merits of the arguments.
Following the development, JSW Steel shares closed 2.31% higher on the BSE at Rs 1,031.75.
BPSL was admitted to insolvency in 2017 with outstanding dues exceeding Rs 45,000 crore. JSW Steel emerged as the successful bidder with a Rs 19,300 crore resolution plan that was approved by the NCLT in 2019 and later upheld by the National Company Law Appellate Tribunal (NCLAT) in 2020.
JSW has since integrated BPSL into its operations. In the fourth quarter of FY25, BPSL recorded crude steel production of 0.98 million tonnes and a net profit of Rs 42 crore. Revenue for the quarter stood at Rs 5,635 crore with an operating Ebitda of Rs 570 crore.
BPSL’s Odisha plant, with a capacity of 4.5 million tonnes per annum, remains a key contributor to JSW Steel’s overall steel-making capacity of 34.2 million tonnes.
