New Delhi—In a gut punch to one of India’s steel giants, the Supreme Court on May 2, 2025, slammed the brakes on JSW Steel’s bid to take over Bhushan Power and Steel, declaring the resolution plan illegal and ordering the beleaguered company into liquidation. The ruling, delivered with the weight of finality, sent ripples through the steel industry and left JSW Steel scrambling after a years-long saga.
The court’s decision came down like a hammer, stating flat-out that JSW’s resolution plan—approved earlier by the Committee of Creditors under the Insolvency and Bankruptcy Code—didn’t pass muster. The plan, meant to revive Bhushan Power, a company drowning in debt and legal woes, was riddled with issues the justices couldn’t overlook. Instead of greenlighting a takeover, the court directed the immediate liquidation of Bhushan Power, effectively pulling the plug on hopes for a turnaround.
Bhushan Power’s troubles aren’t new. The company, once a major player in India’s steel sector, has been tangled in financial messes and fraud allegations for years. Back in 2017, it was dragged into insolvency proceedings after defaulting on massive loans. JSW Steel stepped in as the white knight in 2019, offering a resolution plan worth over ₹19,000 crore toილ
The Supreme Court’s ruling has immediate fallout. JSW Steel’s stock took a beating, dropping more than 6% on May 2 as investors recoiled from the news. The liquidation order means Bhushan Power’s assets—plants, machinery, and land—will now be sold off to repay creditors, a process that could drag on and leave little for unsecured lenders.
The case has roots stretching back to 2019, when the National Company Law Tribunal first approved JSW’s plan. But legal challenges piled up fast. A key issue was whether the plan unfairly favored certain creditors, violating the spirit of the insolvency code. The Supreme Court, after dissecting arguments, agreed that the deal was flawed from the start.
For JSW Steel, the ruling is a bitter setback. The company had already sunk significant resources into the acquisition, banking on Bhushan Power’s assets to boost its production capacity. Now, with liquidation looming, JSW faces a financial hit and a strategic dead end.
The decision also raises bigger questions about India’s insolvency framework. Bhushan Power’s case, one of the first major tests of the 2016 bankruptcy code, was supposed to showcase how distressed companies could be revived. Instead, it’s become a cautionary tale of delays, disputes, and dashed hopes.
Liquidation proceedings will now kick off under the supervision of a court-appointed liquidator. Bhushan Power’s creditors, owed billions, are bracing for a long wait. Secured lenders like Punjab National Bank and State Bank of India may recover some funds, but smaller creditors could be left with scraps. The company’s workforce, too, faces uncertainty as operations wind down.
The Supreme Court’s order is final, with no appeal allowed. Bhushan Power and Steel, once a titan of Indian industry, is now headed for the auction block, its future reduced to a ledger of debts and a stack of legal papers.