Bhushan Power & Steel

Bhushan Power & Steel Limited (BPSL) is a bankrupt steel company that is engaged in the manufacturing and marketing of steel products.[1] It was established in 1970. In July 2019, BPSL was allegedly involved in fraud worth ₹3805.15 crore rupees (US$535.23 million),[2] as detected by Punjab National Bank.[3][4] It is one of India's most indebted companies and appears among the 12 companies referred by the Reserve Bank of India (RBI) to a bankruptcy court for the purpose of debt resolution.[5][1]

Bhushan Power & Steel Limited
TypePrivate
IndustrySteel company
Founded1970
Headquarters
New Delhi
,
India
Key people
Sanjay Singal (MD & Chairman)
WebsiteOfficial website

History

Bhushan Power & Steel was founded in 1970, incorporated in 1999 and registered with the Registrar of Companies in Delhi. The company established its facility in Chandigarh in 1973 to manufacture Tor steel and wire rod. It has 7 manufacturing facilities in India.[6] The company is promoted by Sanjay Singal.[7][8]

Bhushan Power & Steel was acquired by JSW Steel in September 2019.[9][10] JSW Steel's offer of Rs. 19,700 crores was approved by NCLT.[11]

The Enforcement Directorate (ED) had attached assets worth Rs 4,025 crore of BPSL in October 2019 regarding the ongoing probe.[12] The National Company Law Appellate Tribunal (NCLAT) put a stay order, and the Ministry of Corporate Affairs stated in the proceedings that the ED did not have the jurisdiction to attach assets in an insolvency process.[13] The ED is seeking a legal opinion to take the case before the Supreme Court against the order of NCLAT.[14]

Fraud cases

In April 2019, the Central Bureau of Investigation accused the company of taking a loan of ₹47,000 crore (US$7 billion) from various banks including Punjab National Bank (New Delhi and Chandigarh), Oriental Bank of Commerce (Kolkata), IDBI Bank (Kolkata) and UCO Bank (Kolkata), which later turned into non-profitable assets. The case is under investigation by the Central Investigation Bureau.[15]

More banks followed suit in revealing financial misdealing. On July 6, 2019, Bhushan Power and Steel Limited was accused of committing another fraud of ₹3805.15 crore rupees (US$535.23 million) from Punjab National Bank.[16][17] On July 13, 2019, Allahabad Bank disclosed that it had detected a fraud of ₹1,774.82 crore (US$249 million) by BPSL.[18] On July 16, 2019, Punjab & Sind Bank (PSB) reported a ₹238 crore (US$33 million) fraud by BPSL.[19]

References
  1. Srivastava, Pragya (October 23, 2017). "India's Bad Loans: Here is the list of 12 companies constituting 25% of total NPAs". The Financial Express (India).
  2. "38051500000 INR to USD | Convert Indian Rupees to US Dollars | XE". www.xe.com. Retrieved 2019-10-19.
  3. "PNB plunges over 8% after detection of Rs 3,800 crore fraud". Business Today. July 8, 2019.
  4. "PNB detects Rs 3,805-crore fraud by Bhushan Power & Steel; accuses the firm of misappropriating funds, manipulating books". Business Today. July 7, 2019.
  5. Mehta, Sangita (August 13, 2018). "Bhushan Power: Tata Steel gives a revised bid for Bhushan Power, lenders to meet on Tuesday". The Economic Times.
  6. "Everything You Need To Know About Bhushan Power And Steel". Business Insider. July 7, 2019.
  7. Raghunathan, Anuradha (Jun 7, 2010). "Why Two Bhushan Steels". Forbes.
  8. Karmali, Naazneen (May 13, 2014). "Steel Tycoon Sanjay Singal Is India's Newest Billionaire". Forbes.
  9. Mazumdar, Rakhi; Das, Saikat (February 13, 2019). "JSW Steel set to acquire Bhushan Power". The Economic Times.
  10. Iyengar, Suresh P (July 8, 2019). "Scam may delay JSW's buy of Bhushan Power". Business Today.
  11. "NCLT approves JSW Steel's ₹19,700 crore bid for Bhushan Power & Steel". Livemint. 2019-09-05. Retrieved 2020-04-19.
  12. "ED attaches Rs 4,000 cr assets of Bhushan Steel". The Tribune India.
  13. "NCLAT halts Bhushan Power sale to JSW Steel; asks ED to release BSPL assets". Business Standard.
  14. "ED may move Supreme Court against NCLAT order on Bhushan Power's attached properties". Business Today.
  15. Pandey, Munish (April 25, 2019). "Look out circular issued against chief of Bhushan Power & Steel company, his wife". India Today.
  16. Pokharel, Krishna (July 7, 2019). "Indian Bank Defrauded by Another Borrower". The Wall Street Journal.
  17. Rajput, Rashmi (July 10, 2019). "Bhushan Steel turns into a case bigger than anything Indian courts have ever seen". The Economic Times.
  18. "Allahabad Bank defrauded of Rs 17,775 crore by Bhushan Power & Steel". India Today. July 13, 2019.
  19. "Punjab & Sind Bank flags fraud in Bhushan Power account". Livemint. 17 July 2019.
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