NCLAT defers hearing on JSW Steel’s Bhushan Power buyout till Jan 31

Industry: ,    January, 2020
On October 10, the ED had attached assets worth over Rs 4,025 crore of debt-ridden BPSL in connection with its money laundering probe linked to an alleged bank loan fraud by its former promoters of BPSL.

An appellate tribunal on Friday said it would give one last chance to the Central Bureau of Investigation (CBI), the corporate affairs ministry and the Enforcement Directorate (ED) to address whether JSW Steel, the successful resolution applicant for debt-ridden Bhushan Power and Steel (BPSL), should be held liable for prosecution for offences committed by the erstwhile management of BPSL.

The ED had attached assets of BPSL worth over Rs 4,000 crore last year, stalling the implementation of JSW Steel’s resolution plan. The corporate affairs ministry had opposed the move.

“By way of a last chance, we will give the corporate affairs ministry, ED, and CBI (opportunity) to address as to why the appeal may not be disposed of in terms of Section 32A as inserted by Section 10 of Insolvency and Bankruptcy Code amendment ordinance 2019,” said a twomember bench of the National Company Law Appellate Tribunal.

The IBC amendment ordinance 2019 passed by the central government in December grants immunity to the new management of a company acquired under the IBC from offences committed by the erstwhile management if the new management is not a related party to the erstwhile management or under suspicion of being complicit in an offence committed by previous management.