New Delhi, Sept 26 (UNI) In a significant turnaround, the Supreme Court today overturned its own earlier judgment dated May 2, 2025, and upheld JSW Steel’s Rs 19,700-crore resolution plan for Bhushan Power and Steel Ltd (BPSL), one of the RBI’s infamous “Dirty Dozen” referred for insolvency.
A bench comprising Chief Justice of India B. R. Gavai, Justice Satish Chandra Sharma and Justice K. Vinod Chandran delivered the verdict while deciding a batch of appeals arising from the approval of JSW’s plan by the Committee of Creditors (CoC) during the Corporate Insolvency Resolution Process (CIRP).
The order came on review petitions filed by JSW Steel, the CoC, and the erstwhile Resolution Professional challenging the court’s earlier liquidation order.
The bench held that the May 2 ruling rejecting JSW’s plan suffered from “patent error” and deserved to be set aside.
While recognising that the erstwhile promoters Sanjay Singhal and Arti Singhal had the locus to file appeals as “persons aggrieved,” the court found their petitions devoid of merit, noting that their conduct was questionable and aimed at delaying the CIRP.
The judgment reaffirmed that the commercial wisdom of the CoC is paramount under the Insolvency and Bankruptcy Code (IBC), and once a resolution plan is approved by the adjudicating authority, it does not warrant judicial interference.
The court also clarified the role and continuance of resolution professionals and CoCs post-approval of a plan.
On the issue of EBITDA, the Bench categorically held that since neither the Request for Resolution Plan (RfRP) nor the resolution plan itself provided for distribution based on EBITDA, allowing such claims at this stage would defeat the intent of the IBC.
Accordingly, the court dismissed the CoC’s plea seeking an additional Rs 6,100 crore based on BPSL’s EBITDA during the insolvency period.
The court further recorded that JSW had complied with its obligation of upfront equity infusion, brought in the form of compulsorily convertible debentures, which are valid equity instruments under the plan. Appeals filed by operational creditors including Jaldhi Overseas, Medi Carrier, and others were also dismissed.
The verdict effectively restores JSW Steel’s acquisition of BPSL, bringing closure to a prolonged legal battle. The Supreme Court had earlier, in May, ordered liquidation citing procedural lapses and delays, but following review petitions in June, the matter was revisited and judgment was reserved in August before today’s ruling.
Senior advocates Neeraj Kishan Kaul and Gopal Jain represented JSW Steel, assisted by the legal team from Karanjawala & Co., led by Senior Partner Nandini Gore and Partner Tahira Karanjawala, along with associates, and a team from AZB & Partners headed by Senior Partner Rajendra Barot.
The CoC was represented by Solicitor General of India Tushar Mehta, assisted by Raunak Dhillon of Cyril Amarchand Mangaldas.
