Bankers agree to return JSW Steel money if it loses the case
In a interesting twist, the Supreme Court had accepted the petition filed by Bhushan Power and Steel promoter Sanjay Singal against JSW Steel’s bid to take over the bankrupt company in an insolvency driven process.
Among other issues, the petitioner had questioned the National Company Law Appellate Tribunal’s powers to provide immunity for JSW Steel from the ongoing investigation against BPSL and its promoters.
The three-judge Supreme Court panel headed by Chief Justice SA Bobde refused to stay JSW Steel from proceeding with the acquisition.
The court said if JSW Steel pays the money and loses the case, then the lenders have to return the money to the company.
The development has put JSW Steel in quandary as it will be declared a defaulter if it does not pay the committed ₹19,700 crore to close the deal before the March 16 deadline.
JSW Steel’s plea in the Apex Court not to declare it as defaulter remains inconclusive.
The next hearing in the case is fixed for April 15.
Singal had questioned the NCLAT’s decision to approve JSW Steel’s bid despite the Enforcement Directorate attaching BPSL’s asset under the Prevention of Money Laundering Act.
The petition also asked whether Section 32A inserted through an ordinance conferred powers on the NCLAT to remove the attachment made by the Enforcement Directorate under the PMLA. This apart, the NCLAT has allowed the winning bidder JSW Steel to retain the EBITDA of ₹3,000 crore made during the insolvency period.
Rightfully, the petition claimed that the money should go to the financial creditors.
It is submitted that during the insolvency period, the company was run by the committee of creditors at its own cost and risk without servicing the huge outstanding debt.
The Committee of Creditors in its affidavit filed last October made a claim on the EBITDA, but it has been quashed by the NCLAT.
Thank you for being a loyal user of Portfolio.
Portfolio will be a paid section hereon.
Please Subscribe to get access to one of our early bird packs.
Or click on Free Trial to get 14 days free trial.
What You'll Get
-
Web + Mobile
Access exclusive content of the Hindu Businessline across desktops, tablet and mobile device.
-
Exclusive Portfolio and Investment Advice, Banking, Lifestyle and Specials
Get diverse set of perspectives from our trusted experts on Portfolio, Banking, Economy, Environment and others.
-
Ad free experience
Experience cleaner site with zero ads and faster load times.
-
Personalised dashboard
Customize your preference and get a personalized recommendation of stories based on your interest.
Published on
March 09, 2020
A letter from the Editor
Dear Readers,
The coronavirus crisis has changed the world completely in the last few months. All of us have been locked into our homes, economic activity has come to a near standstill. Everyone has been impacted.
Including your favourite business and financial newspaper. Our printing and distribution chains have been severely disrupted across the country, leaving readers without access to newspapers. Newspaper delivery agents have also been unable to service their customers because of multiple restrictions.
In these difficult times, we, at BusinessLine have been working continuously every day so that you are informed about all the developments – whether on the pandemic, on policy responses, or the impact on the world of business and finance. Our team has been working round the clock to keep track of developments so that you – the reader – gets accurate information and actionable insights so that you can protect your jobs, businesses, finances and investments.
We are trying our best to ensure the newspaper reaches your hands every day. We have also ensured that even if your paper is not delivered, you can access BusinessLine in the e-paper format – just as it appears in print. Our website and apps too, are updated every minute, so that you can access the information you want anywhere, anytime.
But all this comes at a heavy cost. As you are aware, the lockdowns have wiped out almost all our entire revenue stream. Sustaining our quality journalism has become extremely challenging. That we have managed so far is thanks to your support. I thank all our subscribers – print and digital – for your support.
I appeal to all or readers to help us navigate these challenging times and help sustain one of the truly independent and credible voices in the world of Indian journalism. Doing so is easy. You can help us enormously simply by subscribing to our digital or e-paper editions. We offer several affordable subscription plans for our website, which includes Portfolio, our investment advisory section that offers rich investment advice from our highly qualified, in-house Research Bureau, the only such team in the Indian newspaper industry.
A little help from you can make a huge difference to the cause of quality journalism!
Support Quality Journalism
Please Email the Editor