Relief for Bhushan Steel In Odisha As NCLAT Directs Release Of Assets

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In what may have come as a temporary relief to Bhushan Power and Steel Limited (BPSL), the National Company Law Appellate Tribunal (NCLAT) on Monday put on hold the Rs 19,700-crore payout by JSW Steel for acquiring the debt-ridden firm, reported PTI.

Further, the Enforcement Directorate (ED) has been directed that:

  • The attached properties of BPSL should be released
  • Any more assets of the firm should not be attached without NCLAT’s permission

Directing the ED and CBI to file a reply in the next two days, an NCLAT bench headed by Chairman Justice S J Mukhopadhyaya said that Insolvency and Bankruptcy Code (IBC) would fail if the agency functions like this.

“IBC cannot be annulled in this manner. Money laundering is by an individual,” NCLAT observed.

The tribunal further said the ED has no jurisdiction to attach the property of a corporate debtor, particularly when an appeal is pending with regard to attachment, it was reported.

It may be recalled that the ED had attached assets worth over Rs 4,025 crore belonging to BPSL in Odisha in connection with its money laundering probe linked to an alleged bank loan fraud on Saturday

The matter has been listed for further hearing on October 25.

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