Govt Reviewing Supreme Court Verdict That Voided JSW Steel’s ₹19,700-Cr Bhushan Deal

The Indian government is in the process of framing its response to the Supreme Court’s recent decision cancelling JSW Steel’s ₹19,700-crore takeout of Bhushan Power & Steel. The Department of Financial Services (DFS) has already met with lenders and law firms to study the implications of the order.

“Already I have gone through the order with all lenders. We have read the judgment, taken legal views, and are now dealing with the approach of the government. A decision will be reached soon,” Finance Ministry’s Secretary DFS M Nagaraju stated on Monday.

The Supreme Court, in a decision last Friday, held JSW Steel’s insolvency resolution plan for Bhushan Power & Steel as “illegal”, reversing the previous approval given by the National Company Law Tribunal in 2019. The order opens the door to possible liquidation of Bhushan unless legal or regulatory intervention at a later stage changes the direction.

The loss is likely to have drastic operational and financial implications for JSW Steel. The steel major is likely to lose 10–15% of its production capacity and witness a 10% hit in EBITDA if Bhushan goes for liquidation.JSW Steel, which would have posted FY26 consolidated EBITDA of ₹42,000–₹45,000 crore, is short by ₹4,000–₹4,500 crore as Bhushan’s contribution is nowhere to be found.

JSW Steel acquired Bhushan Power & Steel in 2019 under the insolvency sale, the biggest purchase to date by the company. Bhushan unit adds more than 13% of JSW’s current 34.2 million tonnes capacity per annum.
JSW Steel shares fell 0.73% to ₹965.10 on the BSE at 11:33 am on Monday following the Supreme Court verdict.
The prompt move by the Finance Ministry demonstrates a proactive measure to counteract the legal and economic implications of the ruling by India’s supreme court, especially considering the impact on India’s overall insolvency resolution system.