NCLT allows SFIO to pursue ₹5,400 crore recovery from Bhushan Power and Steel
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What happened
The NCLT permitted the SFIO to proceed with recovery action totaling ₹5,400 crore in the Bhushan Power and Steel case. It rejected former promoters' objections that the completed insolvency process barred such action, and directed the SFIO to file respondent-specific details on individual roles.
Why it matters
The order indicates that insolvency resolution under the IBC does not automatically close the door on separate fraud-recovery proceedings tied to past management conduct. That can affect recovery expectations, litigation strategy, and deal pricing in distressed acquisitions where buyers seek clarity on legacy liabilities.
The National Company Law Tribunal has approved the Serious Fraud Investigation Office's move to recover ₹5,400 crore from Bhushan Power and Steel Limited and rejected objections from former promoters. The tribunal said insolvency resolution does not block recovery proceedings and asked the SFIO to specify the role of each respondent. The order keeps open post-insolvency enforcement against alleged past wrongdoing and will be read closely across stressed-asset and M&A markets.
Watch for
SFIO filing before the NCLT by 2026-11-05 detailing the role of each named respondent in the ₹5,400 crore recovery claim NCLT daily order sheet update by 2026-11-05 setting the next hearing date or compliance deadline in the Bhushan Power and Steel matter Former promoters' appeal filing before NCLAT by 2026-11-05 challenging the NCLT order on post-insolvency recovery JSW Steel exchange filing by 2026-11-05 stating whether the order changes its legal or financial position regarding Bhushan Power and Steel
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