SC restrains NCLAT from finalising bids on Bhushan Power and Steel Ltd without its nod

The Supreme Court has restrained the National Company Law Appellate Tribunal (NCLAT) from taking a final decision on bids for the debt-stricken Bhushan Power and Steel Ltd (BPSL) without its permission.

A bench of justices R F Nariman and Indu Malhotra sought response from the Centre and others on a plea filed by BPSL chairman and managing director Sanjay Singal while tagging the matter with a batch of similar cases for joint hearing.

"Issue notice... In the meantime, the bids will not be finalised by the National Company Law Tribunal without the leave of this court," the bench said.

The order came while hearing a petition by BPSL chairman and managing director Sanjay Singal challenging various sections of the code including Section 29A, which disqualifies defaulting promoters and connected entities from bidding for their own companies.

According to the plea, insolvency and bankruptcy code is an "imbalanced economic provision" which is "metamorphosing into a takeover or a liquidation code".

In a related development, the NCLAT had yesterday stayed the meeting of Committee of Creditors of Bhushan Power and Steel Ltd to vote on bids.

The NCLAT had also pulled up resolution professional Mahendra Kumar Khandelwal for not following its previous orders to address operational creditors' grievances and take their suggestion by allowing them to attend the meeting.

NCLAT said it would consider whether contempt of court proceedings should be initiated against the resolution professional in the next hearing.