The National Company Law Appellate Tribunal (NCLAT) on Friday directed the Enforcement Directorate (ED) to file an affidavit, giving an update on its differences with the ministry of corporate affairs (MCA) over the insolvent company, Bhushan Power & Steel’s (BPSL) assets attachment.
Hearing a bunch of petitions, a two-member NCLAT bench headed by chairperson Justice SJ Mukhopadhaya also expressed its displeasure over the government’s procrastination in arriving at a consensus on the vexed issue that has stymied BPSL’s resolution. The National Company Law Tribunal (NCLT) approved JSW Steel’s Rs. 19,700-crore bid to take over BPSL in August.
“We need to pass an order,” the NCLAT bench said, in reply to ED’s counsel submission that deliberation in the government were underway on trying to bring an amicable solution to the issue. The NCLAT has scheduled the matter for further hearing on December 12.
The ED and MCA, both under the aegis of Nirmala Sitharaman, are at loggerheads over the attachment of the assets of debt-ridden BPSL in a money laundering case against its former promoters.
While the ED feels it has the authority to do so under the Prevention of Money Laundering Act (PMLA), the MCA is of the view that once the NCLT approves a resolution plan, it becomes binding on all stakeholders and all statutory authorities.
Following attachment of some of the assets worth over Rs. 4,025 crore on October 10, the NCLAT had asked the investigating agency to release the assets and observed that the ED has no jurisdiction to attach the property of a corporate debtor, particularly when an appeal was pending with regard to attachment. “IBC cannot be annulled in this manner. Money laundering is by an individual,” the NCLAT had earlier observed.
JSW Steel had on September 13 filed an appeal before the NCLAT, seeking immunity from attaching the assets of the insolvent company, post-take over, by investigating agencies.