The Supreme Court on December 13 directed the Enforcement Directorate (ED) to handover to JSW Steel the debt-ridden Bhushan Power & Steel’s properties worth Rs 4,025 crore that were provisionally attached in 2019 in connection with a money laundering probe linked to an alleged bank loan fraud by the erstwhile management.  

A bench presided by Justice Bela M Trivedi and Justice S C Sharma directed the release of the properties of the corporate debtor, Bhushan Power and Steel Ltd, which were provisionally attached by the Enforcement Directorate (ED).  

The properties are now to be handed over to JSW Steel Ltd (JSW), the successful resolution applicant in the insolvency proceedings of Bhushan Power and Steel Ltd (BPSL). 

The Enforcement Directorate temporarily attached the assets in 2019 under the Prevention of Money Laundering Act (PMLA) because the former management was under investigation for an alleged bank loan fraud. 

The ED has restituted assets worth Rs 4,025 crore of the erstwhile Bhushan Steel and Power Limited to JSW Steel following approval from the Supreme Court, the agency said on December 14. It said the restitution of assets was made under Section 8(8) of the PMLA (restitution pending trial), read with Rule 3A of PMLA Restoration of Property Rules.  

In its order, the Supreme Court, relying on an affidavit filed by the ED, observed that Section 8(8) of the Prevention of Money Laundering Act, 2002, read with Rule 3A of the Prevention of Money Laundering (Restoration of Property) Rules, 2016, permitted JSW to take control of the corporate debtor’s properties that were provisionally attached by the ED. The ED further submitted that, given the peculiar circumstances of the present case, JSW should be permitted to take control of the attached properties. 

Under the management and control of JSW Steel Ltd., BPSL has undergone a significant turnaround. As of now, BPSL provides direct and indirect employment to over 20,000 individuals. Within a short span of three years since the implementation of the resolution plan, BPSL has doubled its operational steel manufacturing and production capacity, operating with only a tenth of the liabilities it faced at the commencement of insolvency proceedings. 

JSW Steel Ltd was represented before the Supreme Court by Senior Advocates Neeraj Kishan Kaul and Gopal Jain, along with a legal team from Karanjawala & Co, led by Nandini Gore (Senior Partner), Tahira Karanjawala (Partner), Swati Bharadwaj, Akarsh Sharma, Manvi Rastogi and Sharanya Ghosh.