JSW Energy joins race for Raigarh Champa Rail Infra after NCLAT nod

Appellate tribunal NCLAT has quashed an NCLT order that denied permission to the lenders of debt-ridden Raigarh Champa Rail Infrastructure to start a fresh bidding process.

The development has come as a relief to JSW Energy which had sought permission to participate in the insolvency resolution process of Raigarh Champa Rail Infrastructure Pvt Ltd (RCRIPL), an ancillary company of KSK Mahanadi.

JSW Energy has already acquired KSK Mahanadi Power, a 3,600 MW thermal power plant in Chhattisgarh, for Rs 16,084 crore through the insolvency process, earlier in March this year.

The Chennai-bench of the NCLAT said it sees no demerits in the decision of the lenders' body CoC to invite fresh Expression of Interest (EoI) by re-issuing fresh Form G, inviting new prospective buyers as it "will certainly increase competition and in all likelihood, result in higher bids."  ".... since, the EoI is proposed to be reopened for everybody and not for JSW alone, it is fair and transparent and not discriminatory and that since, existing PRAs (Prospective Resolution Applicants) are proposed to be retained with option given to them to participate in challenge mechanism, it is also fair to the existing Resolution Applicants," it said.

Moreover, the tribunal over the bid submitted by Medha group, which was the highest and also approved earlier by RCRIPL lenders with 100 per cent votes earlier, said it is "proposed to be the Reserve Price, there cannot be any value erosion of the Corporate Debtor, if EoI process is reopened."  Five companies, including Adani Power, Jindal Power, Medha Servo Drives, Sherisha Technologies and Vedanta, were in the race to acquire the special Purpose Vehicle (SPV) promoted by KSK group.

Earlier, on April 3, 2025, the Hyderabad bench of the National Company Law Tribunal (NCLT) denied permission to the RP and the lenders' body Committee of Creditors (CoC) for issuance of a fresh Form G and invitation of EoI from new eligible Prospective Resolution Applicants, including JSW Energy.

Instead, in fresh bidding, NCLT directed to conduct the challenge mechanism amongst the bidders as earlier decided by the CoC.

However, NCLAT said it sees no demerits in the proposal of the RP and decision of the CoC, as going by previous decisions, the lenders' body has the power to call for fresh Form G and permit other PRAs to participate even after submission of EoI.

"The Impugned Order of April 3, 2025, is hereby quashed and as a consequence. The relief as sought for, by the Resolution Professional, to be permitted to issue fresh Form G and to invite Expression of Interest (EoI) from new and interested eligible Prospective Resolution Applicants is granted," said the NCLAT order passed on June 19, 2025 by a two member comprising Justice Sharad Kumar Sharma and Jatindranath Swain.

Form G under IBC is an Invitation for Expression of Interest (EoI) and is published by the Resolution Professional (RP) to invite potential resolution applicants to submit their proposals for taking over a company undergoing CIRP.

JSW Energy has already acquired KSK Mahanadi Power, a 3,600 MW thermal power plant in Chhattisgarh, for Rs 16,084 crore through the insolvency process, earlier in March this year.

RCRIPL is an SPV promoted by the KSK group to construct, lay a railway line and associated infrastructure from coal fields in Mand Raigarh to the power stations in Janjgir Champa.

It passes through the Indian Railways Network for transporting coal, associated fuels and such other raw materials, as well as fly ash and other.

CIRP was started against RCRIPL on January 1, 2021, and the first final Form G was issued on 24.08.2021. However, the EoI submission process remained pending till May 2024, because NCLT directed the RP of KMPCL (KSK Mahanadi Power Company Ltd) not to receive any resolution pending adjudication of various proceedings seeking consolidation of the CIRP of KMPCL and KWIPL (KSK Water Infrastructures).

Later on July 4, 2024, CoC approved the resolution plan submitted by Medha with 100 per cent voting share and moved a plea before NCLT.

However, before the Hyderabad bench of NCLT could approve Medha's bid, the RP of RCRIPL filed another plea seeking permission for undertaking a challenge mechanism among the resolution applicants/bidders in accordance with the CIRP Regulations.

This application for withdrawal of Plan Approval by lenders was approved by a majority voting share of 78.59 per cent of CoC, and NCLT allowed it.

However, instead of proceeding with the challenge mechanism, the RP then filed another plea, wherein permission for reopening of the bidding process for RCRI was sought, for the purpose of inviting an EoI from JSW Energy, enabling them to participate in the CIRP.

This new request of the RP to allow to opening bidding process and add JSW Energy was denied by NCLT, saying it was contrary to the principles of fairness and the timelines of the CIRP process.

Later, JSW Energy also approached NCLT by filing applications seeking permission to participate in the CIRP of Raigarh Champa Rail Infrastructure by requesting issuance of a fresh Form G, which was again dismissed.

Finally, a third application was moved by RP to facilitate the entry of JSW as a Resolution Applicant in the CIRP of RCRI.

It sought permission of the tribunal for issuance of a fresh Form G and invitation of EoI from new, interested, and eligible Prospective Resolution Applicants for submission of Resolution Plans.

This was again rejected by a two-member bench of NCLT comprising Members Sanjay Puri and Rajeev Bhardwaj on April 3, 2025.

This was challenged before the appellate tribunal NCLAT, which on June 16 quashed the NCLT order.