NCLT approves Rs 700 cr resolution plan for Raigarh Champa Rail Infrastructure

In a significant ruling that brings a five-year-long insolvency proceeding to a close, the National Company Law Tribunal (NCLT) in Hyderabad has approved the resolution plan submitted by JSW Energy Limited for Raigarh Champa Rail Infrastructure Private Limited. The order, passed on January 21, 2026, greenlights a resolution plan worth ₹700 crore, marking the end of a Corporate Insolvency Resolution Process (CIRP) that began in January 2021. The plan, which received 100% approval from the Committee of Creditors (CoC) in November 2025, was formally sanctioned by the two-member bench of Judicial Member Rajeev Bhardwaj and Technical Member Sanjay Puri.

The approval brings certainty to a process that was marred by delays and legal skirmishes. The CIRP, initiated by a petition from Axis Bank, saw multiple twists, including a change in the majority lender. JM Financial Asset Reconstruction Company (JMFARC) eventually became the sole member of the CoC after acquiring debt from various lenders, holding 78.59% of the voting share.

The path to JSW’s victory was anything but linear. Earlier in the process, Medha Servo Drives had emerged as the preferred bidder, but protracted litigation from other aspirants—including Jindal Power and JSW itself—stalled the process. After a series of dismissals and appeals, the NCLAT in June 2025 finally permitted the issuance of a fresh Form-G, reopening the bidding.

In the rebid, JSW Energy competed with Shanti GD Ispat & Power. The SRA’s final offer of ₹700.10 crore significantly exceeded the company’s liquidation value of ₹206.22 crore and its fair value of ₹293.74 crore, ensuring a better recovery for creditors.

Under the terms of the approved plan, secured financial creditors, led by JMFARC with admitted claims of ₹543.62 crore, will receive ₹699.99 crore—a recovery of 129% of their admitted dues. This will be paid out over ten years, comprising ₹104.3 crore in upfront cash and ₹550 crore via debt instruments carrying interest of 8% for the first eight years and 10% thereafter. Operational creditors, including Axis Trustee Services, will receive their full admitted dues of ₹10.58 lakhs within 90 days.

The tribunal noted JSW Energy’s extensive experience in the power sector, highlighting its operational capacity of over 13,000 MW and its successful turnaround of other distressed assets like Ind Bharat Energy and KSK Mahanadi. The NCLT, citing settled law from the Supreme Court, emphasized that the commercial wisdom of the CoC is paramount and that judicial review is limited to ensuring the plan meets the statutory requirements of Section 30(2) of the IBC.

With the plan now approved, the moratorium under Section 14 stands lifted. A monitoring committee, including representatives of JSW and the financial creditors, will oversee the implementation of the plan. The performance bank guarantee of ₹50 crore furnished by JSW will remain in force until all payments are made.

For JSW Energy, the acquisition consolidates its position in the sector, bringing a rail infrastructure asset critical for coal evacuation under its control. For the creditors, the decade-long payout structure offers a steady, secured return, closing a chapter on a non-performing asset that had been stuck in resolution for over five years.

Summary of Distribution under the Resolution Plan

Also See: NCLT approves JSW Infra’s Rs 467 cr resolution plan for NCR Rail Infrastructure