On Monday, the National Company Law Appellate Tribunal (NCLAT) allowed JSW Steel to acquire Bhushan Power & Steel Ltd for Rs 19,700 crore by providing it immunity from prosecution by the Enforcement Directorate.
A 2-Member bench headed by Chairman Justice S J Mukhopadhaya said that JSW Steel will be immuned from the acts done by the former promoters of Bhushan Power & Steel Ltd (BPSL).
However, it also said that prosecution against the Ex-Promoters under the money laundering act by the Enforcement Directorate can continue.
It has also turned down the pleas filed by operational creditors, seeking higher claims.
The bench said that the EBITDA (earnings before interest, tax, depreciation & amortisation) earned by BPSL during its corporate insolvency resolution period will be given to JSW Steel.
On Oct 10, the Enforcement Directorate 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 Ex-Promoters.
JSW Steel, which emerged as the successful resolution applicant with its Rs 19,700 crore bid for BPSL, filed a petition against the ED's move before the NCLAT.
On Oct 14, the appellate tribunal ordered the Enforcement Directorate to immediately release the confiscated assets of BPSL in favour of the resolution professional of the debt-ridden firm.
While the Enforcement Directorate was of the opinion that it can attach the property of BPSL under the Prevention of Money Laundering Act (PMLA), the ministry of corporate affairs has been maintaining that the ED can't do so as the proceedings under the Insolvency & Bankruptcy Code was going on.
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