SC Dismisses Appeals On JSW Steel's Resolution Plan For Bhushan Power And Steel

New Delhi: The Supreme Court, on Friday, dismissed appeals challenging JSW Steel’s Rs 19,700 crore resolution plan for Bhushan Power and Steel Limited (BPSL).

This was in context to the Court’s judgement of May 2, 2025, in which the bench of Justice Bela M Trivedi and Justice Satish Chandra Sharma had struck down JSW Steel’s plan and ordered BPSL’s liquidation under Article 142 of the Constitution.

The bench had then held that the Committee of Creditors (CoC) had erred in approving the plan.

JSW Steel, chosen as the successful resolution applicant in 2019, offered over Rs 19,000 crore to creditors. The plan was approved by the National Company Law Tribunal (NCLT) in September 2019 and upheld by the National Company Law Appellate Tribunal (NCLAT). The Enforcement Directorate (ED) challenged the plan citing alleged money laundering by BPSL’s former promoters.
The Supreme Court, on July 31, recalled its May 2 judgement, noting that it may have misapplied settled Insolvency and Bankruptcy Code (IBC) principles and relied on inaccurate or unargued points. It thus decided to rehear the matter.

“We have held that the delay is not attributable to CoC or the Successful Resolution Applicant (SRA). They have been trying to sort it out and enforce the resolution plan. We have held that CCDs issued by SRA are to be treated as equity. Commercial wisdom cannot be interfered with…Once the resolution plan is approved by CoC, permitting any claims to be reopened will amount to committing violence on provisions of law,” the bench of Chief Justice of India B R Gavai, Justice Satish Chandra Sharma and Justice Vinod Chandran held on Friday.
The Court also noted that JSW invested huge amounts in making BPSL a profit-making company and cannot be penalised for doing so.

Solicitor General Tushar Mehta, representing the CoC, had said during the hearing that JSW must pay Bhushan Power the Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) as it had not taken over the company as planned.

The erstwhile promoters of BPSL told the Court that liquidation of the company was not the objective, and that a fresh Corporate Insolvency Resolution Process (CIRP) should be initiated if JSW’s resolution plan is found to be flawed. They had also argued that the CoC could not have extended the time for implementing the resolution plan as it had become functus officio after the approval of the plan by NCLT.

JSW, however, insisted that the company had taken over a loss-making entity and fulfilled its commitments despite prolonged delays caused by the ED in attachment of assets. Even when the Resolution Professional (RP) began managing BPSL in 2021, the company continued to record net losses, it was submitted.