Bhushan Power follows parent to NCLT as PNB acts tough

Bhushan Power & Steel on Friday became the sixth amongst the 12 largest indebted companies named by the RBI to face liquidation proceedings, as the lenders led by PNB decided to refer it to NCLT. The proceedings will be carried out against the company under the Insolvency and Bankruptcy Code (IBC). Its parent company, Bhushan Steel, was referred to the tribunal for liquidation on Thursday by the lenders led by SBI.

The Delhi-based Bhushan Power & Steel, which owes Rs 37,248 crore to a consortium of lenders led by Punjab National Bank, is the sixth out of the 12 large stressed accounts identified by the Reserve Bank earlier this month for referral to the National Company Law Tribunal (NCLT).

"Banks at a meeting on Friday decided to refer the case to NCLT for recovery," said a banker. On Thursday, lenders led by SBI had decided to send Bhushan Steel, Essar Steel and Electrosteel Steels to NCLT to initiate insolvency proceedings.

While Bhushan Steel is in default of Rs 44,478 crore to banks, Essar Steel owes Rs 37,284 crore and Electrosteel Steels Rs 10,273.6 crore. Amtek Auto which owes Rs 14,074 crore to lenders will also be referred to NCLT soon.

On Saturday, Lanco Infratech, in default of Rs 44,364.6 crore, said the RBI had directed its lead banker IDBI Bank to initiate insolvency procedure.

The internal advisory committee (IAC) of the RBI after its meeting on June 13 had recommended 12 accounts constituting about 25 per cent of the gross NPAs of the banking system for immediate reference under IBC.

Other identified accounts include Alok Industries (Rs 22,075 crore), Monnet Ispat (Rs 12,115 crore), Era Infra (Rs 10,065.4 crore), and Jypaee Infratech (Rs 9,635 crore).