High Court set to re-examine decision annulling JSW Steel's $2.3 billion Bhushan Power agreement
The Supreme Court of India has decided to reconsider its May 2, 2025 judgment that quashed JSW Steel's $2.3 billion resolution plan for Bhushan Power and Steel Limited (BPSL). This recall comes after the Court found errors in its earlier ruling and a failure to properly consider binding legal precedents, leaving the matter open for fresh adjudication.
The Court's decision to re-examine the insolvency resolution process of BPSL, including the validity of JSW Steel's resolution plan, is significant for Indian bankruptcy reforms. The case touches upon the interpretation of the Insolvency and Bankruptcy Code, 2016 (IBC), particularly concerning the appealability of resolution plans under Section 61(3) and proper adherence to the insolvency resolution process. The Supreme Court’s reconsideration could clarify key procedural questions, reinforce creditor rights, and impact the uncertainty faced by bidders and investors in insolvency cases, thereby influencing the effectiveness and credibility of India's bankruptcy framework.
The rejection of the deal by the Supreme Court in May had unsettled buyers of other distressed assets and cast a shadow over Indian bankruptcy reforms introduced in 2016. The liquidation proceedings of Bhushan Power were paused weeks later, allowing JSW Steel to seek a review of the verdict.
The top court heard the review plea on Thursday and has scheduled the case for hearing on August 7. The Court found that the verdict quashing the deal did not correctly consider the legal position established by past precedents, leading to its decision to recall the judgment and consider the matter afresh.
[1] The Economic Times. (2021, July 22). Supreme Court to reconsider order quashing JSW Steel's deal for Bhushan Power. Retrieved from https://economictimes.indiatimes.com/news/economy/corporate/supreme-court-to-reconsider-order-quashing-jsw-steels-deal-for-bhushan-power/articleshow/85583882.cms
[2] Livemint. (2021, July 22). Supreme Court to reconsider its order quashing JSW Steel's $2.3 billion deal for Bhushan Power. Retrieved from https://www.livemint.com/companies/news/supreme-court-to-reconsider-its-order-quashing-jsw-steels-2-3-billion-deal-for-bhushan-power-11626976070412.html
[3] Bar & Bench. (2021, July 22). Supreme Court to reconsider order quashing JSW Steel's deal for Bhushan Power and Steel Limited. Retrieved from https://www.barandbench.com/news/litigation/supreme-court-to-reconsider-order-quashing-jsw-steels-deal-for-bhushan-power-and-steel-limited
[4] Business Standard. (2021, July 22). Supreme Court to reconsider its order quashing JSW Steel's $2.3 billion deal for Bhushan Power. Retrieved from https://www.business-standard.com/article/companies/supreme-court-to-reconsider-its-order-quashing-jsw-steel-s-2-3-billion-deal-for-bhushan-power-121072200063_1.html
The Supreme Court's decision to reconsider its previous ruling on the JSW Steel's resolution plan for Bhushan Power and Steel Limited (BPSL) has significant implications for the business and finance sector in India, as it could impact the certainty and effectiveness of Indian bankruptcy reforms and the rights of creditors. The review of the verdict could also sway investors' decisions in future insolvency cases, given the uncertainties that stirred in the market due to the initial rejection of the deal.
