Along with the Bhushan Power and Steel, JSW Steel case, RP under the spotlight, too

Last week's Supreme Court order scrapping JSW Steel's acquisition of Bhushan Power and Steel (BPSL) has put under the spotlight the role of Mahender Kumar Khandelwal, the resolution professional the top court hauled up for his 'utter' failure in discharging 'statutory' duties in one of India's biggest manufacturing debt-resolutions to date.

His record as a resolution professional-after India revamped bankruptcy laws to help extricate lakhs of crores of rupees stuck in debt-laden companies-is best described as chequered. Khandelwal faced questions over the 'unnecessary use' of chartered planes, besides allegations of favouring JSW Steel in the debt resolution. He also faced charges of allegedly being a party to what probe agencies described as similar to a money-laundering exercise during his early tenure as a Bhushan administrator.

In its observations on Friday, the Supreme Court bench cited two key reasons for its decision: A delay in implementing the resolution plan, and the funding structure used by JSW Steel.

"The resolution professional had utterly failed to discharge his statutory duties...during the course of entire CIR proceedings of the corporate debtor BPSL," the bench said in its judgement.

Khandelwal was pulled up for allegedly not making an application for extension of time under Section 12 of the Insolvency and Bankruptcy Code (IBC), and for not certifying whether JSW Steel was "eligible" under Section 29A to submit a resolution plan. The resolution professional also allegedly didn't make any applications to avoid transactions in accordance with Chapter-III of the code, the SC said.

Bhushan Power was one of the 'dirty dozen' recognised by the Reserve Bank of India (RBI) in 2017 for resolution, and this bankruptcy received bids from multiple interested parties.