A court in New Delhi has discharged JSW Steel Ltd, formerly known as Monnet Ispat, in a case related to alleged irregularities in the allocation and running of two coal blocks in Chhattisgarh. The court’s decision comes after JSW filed a discharge plea, citing immunity granted under the law, as the company took over Monnet Ispat under the Insolvency and Bankruptcy Code (IBC).
The case dates back to September 2012, when the Central Bureau of Investigation (CBI) filed a case against JSW and others related to the alleged irregular allocation of coal blocks between 1993 and 2005. The coal blocks in question, Gare Palma and Rajgamar Dipside, were allegedly allocated to JSW’s predecessor, Monnet Ispat, without a transparent bidding process.
However, under the IBC, JSW was able to take over Monnet Ispat through a resolution process, which granted the company immunity from prosecution. The adjudicating authority approved JSW’s application to take over Monnet Ispat, and the court has now discharged JSW from the case.
This decision is significant, as it marks another instance of a company being able to escape criminal prosecution under the IBC. The IBC has been criticized for providing an easy exit route for companies involved in financial wrongdoing, and cases like this one have raised concerns about the lack of accountability in the country’s corporate sector.
The discharge of JSW also raises questions about the effectiveness of the CBI’s investigation into the coal block allocation scam. The CBI had filed multiple cases against various companies and individuals involved in the scam, but many of these cases have since been closed or discharged due to various reasons.
Overall, the discharge of JSW Steel Ltd in the coal block allocation case highlights the challenges in holding companies accountable for financial wrongdoing in India, and the need for a more robust regulatory framework to prevent such cases in the future.