In a dramatic legal turn, the Supreme Court of India has agreed to hear JSW Steel Ltd’s review petition in open court regarding its previously quashed acquisition of Bhushan Power and Steel Ltd (BPSL). The hearing is scheduled for July 31, 2025, at 3:00 PM IST, offering JSW Steel and its consortium of lenders a critical opportunity to reverse the May 2 judgment that ordered BPSL’s liquidation.
This development marks a pivotal moment in one of India’s most complex insolvency cases, with implications for corporate governance, creditor rights, and the future of distressed asset resolution under the Insolvency and Bankruptcy Code (IBC).
Key Developments and Highlights:
- Supreme Court allows oral hearing of JSW Steel’s review petition on July 31
- May 2 ruling had scrapped JSW’s ₹19,350 crore acquisition of BPSL and ordered liquidation
- Lenders including SBI and PNB support JSW’s plea, citing operational revival and financial stability
- Interim relief granted on May 26, halting liquidation proceedings pending review
Background of the Dispute:
JSW Steel acquired BPSL in March 2021 after a prolonged insolvency process initiated in 2017. The ₹19,350 crore resolution plan was approved by the Committee of Creditors (CoC), the National Company Law Tribunal (NCLT), and later upheld by the National Company Law Appellate Tribunal (NCLAT). However, dissenting financial creditors and former promoters challenged the acquisition, leading to the Supreme Court’s May 2 verdict that declared the resolution plan illegal due to timeline violations, eligibility concerns, and unequal treatment of creditors.
JSW Steel’s Arguments in Review Petition:
- JSW Steel claims its acquisition revitalized BPSL, doubling production capacity from 2.3 MTPA to 4.5 MTPA
- Revenue surged from ₹8,701 crore in FY17 to ₹25,973 crore in FY25, with annual exports averaging ₹2,976 crore
- The company argues that liquidation would be catastrophic for stakeholders, including lenders, employees, and the broader steel ecosystem
- JSW also contests the court’s interpretation of IBC provisions, particularly regarding implementation delays and promoter eligibility
Lenders’ Position and Financial Exposure:
- Punjab National Bank and State Bank of India, leading the CoC, have filed separate review petitions supporting JSW
- Banks argue that the resolution plan was fully implemented and that the May 2 judgment contains factual and legal errors
- Total exposure to BPSL exceeds ₹47,000 crore, with lenders warning that liquidation would jeopardize recoveries and destabilize the sector
Legal and Sectoral Implications:
The Supreme Court’s decision to allow oral hearings signals recognition of the case’s complexity and potential precedent-setting impact. Legal experts note that the outcome could redefine how resolution timelines and bidder eligibility are interpreted under the IBC.
For the steel industry, the case is a litmus test for investor confidence in India’s insolvency framework. JSW Steel’s ability to retain BPSL could influence future bids for distressed assets and shape the contours of corporate restructuring in India.
What’s Next:
- Oral hearing on July 31 will determine whether the May 2 judgment stands or is overturned
- If JSW succeeds, it could retain control of BPSL and avoid refunding the ₹19,350 crore paid to creditors
- A ruling in JSW’s favor may also prompt legislative or regulatory clarifications to prevent similar disputes
Conclusion:
The Supreme Court’s acceptance of JSW Steel’s review petition has reignited hope for a resolution in the Bhushan Power case. With billions at stake and the future of a major industrial asset hanging in the balance, all eyes are now on the July 31 hearing — a moment that could reshape India’s insolvency landscape.
Sources: Economic Times, LiveMint, Moneycontrol, CNBC-TV18, Insolvency Tracker India
