India’s Supreme Court has decisively affirmed JSW Steel Ltd.’s 197 billion rupees ($2.2 billion) acquisition of debt-laden Bhushan Power & Steel Ltd. This ruling comes after a review of its earlier judgment, which had initially quashed the significant deal. A three-judge bench, presided over by Chief Justice of India B.R. Gavai, upheld the acquisition's validity, emphasizing its adherence to the established debt resolution process.

A critical aspect of the verdict was the court’s rejection of lenders’ demands for additional payments from JSW, India’s largest steelmaker. These lenders had sought further compensation to account for earnings generated by Bhushan Power during the period of delay in the acquisition's finalization. The court explicitly stated that “Permitting any claims to be reopened will amount to committing violence on the provisions of the law,” further noting that the delay could not be attributed to JSW, as it was caught in extensive legal proceedings surrounding the deal.

The judges elaborated that accepting contentions for additional payments or rejecting the deal would be “disastrous” and would fundamentally defeat the purpose for which India's bankruptcy laws were enacted. This strong stance underpins the court’s commitment to finality in resolution plans under the Insolvency and Bankruptcy Code.

This affirmation marks a major relief for tycoon Sajjan Jindal’s company. JSW Steel has already integrated Bhushan Power as a subsidiary since completing the acquisition in 2021 and has since substantially boosted the unit's annual crude steel capacity by nearly 65%. While JSW shares saw an initial surge of up to 1.7% following the order, these gains were later erased.

The legal journey of this acquisition was complex. In July, a two-judge bench, also headed by Justice Gavai, had recalled a previous Supreme Court order from May. The May order had initially rejected JSW's plan, citing non-conformity with India’s bankruptcy laws and directing the liquidation of Bhushan Power. JSW, alongside several lenders, had subsequently sought a review of this pivotal decision, a legal recourse available under Indian law only on limited grounds, such as apparent errors in judgment.