The Supreme Court on Wednesday stayed an order of the Punjab and Haryana High Court in which it had asked the Committee of Creditors (CoC) of Bhushan Power and Steel Limited and the National Company Law Tribunal (NCLT) to consider the objections raised by the former directors of the company before finalising any resolution plan. The directions by the high court were issued despite the Principal Bench of NCLT at New Delhi having already reserved its judgment on a resolution plan for Bhushan Power, submitted by JSW Steel.
On April 18, a former director of Bhushan Power Ravi Parkash Goyal approached the high court with a plea that he had neither been heard by the CoC of Bhushan Power nor been heard appropriately by the lender or the NCLT. The high court, after hearing Goyal’s petition, had directed that Bhushan Power CoC give him a fresh hearing and that the NCLT first decide on the issue of why he was not provided with the resolution plan despite clear orders in this regard from the Supreme Court in other cases. A two judge bench of the high court had also said that any decision taken by the NCLT would be “kept inoperative for two weeks” so as to enable Goyal to challenge it in accordance with law.
Bhushan Power lenders had later challenged the high court’s order in the National Company Law Appellate Tribunal (NCLAT), arguing that the high court did not have jurisdiction to adjudicate on the issue since the NCLT was already hearing the same. While passing its order in the issue, though the NCLAT had refrained from making any comments on the high courts’ order, it had said that the NCLT should pass its judgment in the issue “uninfluenced by any order except the decision of this appellate tribunal and the Supreme Court”.
“The adjudicating authority (NCLT) is supposed to decide the case on merit in accordance with law uninfluenced by any order except the decision of this appellate tribunal and the Supreme Court. While observing so, we are not expressing any opinion with regard to the intervention, which is sought to be made by the ex-directors and promoters of Bhushan Power and Steel Limited,” the appellate tribunal had then said. The NCLAT had, however, expressed its reservation as to how a vacation bench of the high court had passed an ex-parte order and that too without issuing notice to the respondents.
Bhushan Power owes close to Rs 37,248 crore to a consortium of lenders led by Punjab National Bank. It is the sixth out of the 12 large stressed accounts identified by the Reserve Bank of India.