JSW Steel has decided not to make the payment of ₹19,700 crore to close the Bhushan Power and Steel without getting final nod from the Supreme Court.
The deadline for paying the committed money to Committee of Creditors ended on Monday. The National Company Law Appellate Tribunal (NCLAT) had approved JSW Steel resolution plan on February 17 with the immunity from criminal proceedings being conducted by central investigating agencies on past-BPSL promoter Sanjay Singal and over riding the attachment of BPSL asset by investigating agencies.
The petition also questioned NCLAT’s decision to allow the winning bidder JSW Steel to retain the Ebitda of ₹3,000 crore made during the insolvency period. Following this, Singal moved the Supreme Court against the NCLAT order.
Earlier this month, accepting the petition filed by BPSL promoter petition, the three-judge Supreme Court panel headed by Chief Justice SA Bobde refused to stay JSW Steel from proceeding with the acquisition.
The development had poured water on bankers plan to receive the money before March-end and shore up their profits given the current challenging business environment.
JSW Steel is now banking on the short SC judgement which said “AM Singhvi, learned counsel appearing for Committee of Creditors states that in case he receives the money, he will return the said amount within two months, if the appeal succeeds...”
Mention of the word “in case” in the judgement clearly means that the payment to be made for the deal by JSW Steel before the final SC judgement is optional and it cannot be declared as defaulter, said a senior lawyer.
Moreover, he added a corporate cannot commit such huge money without certainty of getting the asset.