After battling for more than two-and-half years, JSW Steel bid to takeover bankrupt Bhushan Power and Steel (BPSL) is far from over.
BPSL promoter Sanjay Singal has filed a petition in the Supreme Court against National Company Law Appellate Tribunal order clearing ₹19,700 crore bid of JSW Steel to acquire the bankrupt company under Insolvency and Bankruptcy Code.
The case is likely to come for hearing on Monday.
Apart from questioning the authority of NCLAT to provide immunity to JSW Steel, the petition has raised brows over vesting ₹3,000 crore profit made by BPSL during the insolvency period to JSW Steel.
"Can JSW Steel be allowed to retain the EBITDA of ₹3,000 crore made during the Corporate Insolvency Resolution Process as a windfall gain and at the cost of creditors.. especially when the insolvency process has extended over two-and-half years.
It is submitted that during the insolvency period the company was run by a committee of creditors at their own cost and risk without servicing any interest in substantial outstanding debt. The Committee of Creditors in their affidavit filed in October 2019 have made a claim on EBITDA.
However, the petition said NCLAT has set aside the order passed by Adjudicating Authority (NCLT) transferring the money to CoC.. thereby exposing JSW Steel to huge benefit..."
If BPSL can be given immunity from the ongoing investigation, Singal has claimed whether he as a promoter of the company can also claim such immunity "especially when the investigating agency itself contending that the monies were utilised for the benefit of corporate debtor (BPSL) only and even as per the case of Enforcement Director the appellant (Singal) never benefitted".
The petition is also highlighting lack of powers to NCLAT to remove the attachment of property (including BPSL) made by Directorate of Enforcement under Prevention of Money Laundering Act even when the SC has admitted a special leave petition filed by CoC against ED in this regard.
The petition has also sought clarity on whether JSW Steel can be termed as a related party with BPSL as it had a joint venture for operating Roma Coal Company...
However, JSW Steel had earlier clarified that the joint venture was formed as the government allotted the coal mine to four companies including JSW Steel and BPSL. Moreover, the joint venture was a non-starter and dissolved before it could start.