ED Restores Rs 4,025 Crore Worth of Assets to JSW in Bhushan Steel Resolution Case
In a significant development, the Enforcement Directorate (ED) on Saturday announced the return of assets worth Rs 4,025 crore to JSW, the successful resolution applicant of the troubled Bhushan Power and Steel Ltd (BPSL), under the Corporate Insolvency Resolution Process (CIRP) of the Insolvency and Bankruptcy Code (IBC).
The assets were seized by the ED in 2019 following a money laundering investigation that revealed the previous promoters of BPSL had defrauded banks, misappropriating funds amounting to Rs 47,204 crore for personal investments. The case was registered under the Prevention of Money Laundering Act (PMLA) based on an FIR filed by the CBI.
According to the ED, the promoters manipulated financial records to show fictitious expenses and purchases, allowing them to siphon off bank funds as cash. This cash was channeled into various companies owned through dummy directors and employees, which was then used for investments in shares and real estate.
After tracking the illicit funds, the ED attached assets, including land, buildings, and machinery, valued at Rs 4,025 crore. The promoter, Sanjay Singal, was arrested in November 2019, and a chargesheet was filed against him and BPSL in January 2020. While the special court took cognizance of the case, the trial has been delayed for over four years due to repeated adjournments requested by the accused.
Additionally, the ED has attached assets worth Rs 427 crore linked to various shell companies associated with the accused.
A supplementary chargesheet is expected soon, and the agency plans to begin the restitution process for the remaining assets. The creditor banks had initiated the corporate resolution process under IBC, with JSW seeking assets worth approximately Rs 19,350 crore, in relation to the Rs 47,204 crore outstanding loans.
In an affidavit filed with the Supreme Court, the ED requested the court to order the return of the attached assets to JSW as part of the restitution process under PMLA. On December 11, the Supreme Court accepted the ED’s request and directed that the assets be handed over to JSW.
