The bankruptcy law in India may have finally settled its first major case. The Supreme Court's decision on Friday in the Essar Steel case has won for banks an amount of at least Rs 35,000 crore which global steel giant Arcelor Mittal is going to pay out to buy Essar Steel from its defaulting promoters, the Ruias.

The apex court has set aside the National Company Law Appellate Tribunal's (NCLAT) ruling that provided for equal distribution of proceeds between financial and operational creditors.

However, the importance of the Supreme Court's judgement goes way beyond just this Rs 35,000 crore. The judgement sets some key ground rules by which future cases will be decided.

CNBC-TV18 explains:

The significance of the Essar Steel verdict by Supreme Court

CNBC-TV18 spoke to Bahram Vakil founding partner at AZB & Partners, corporate lawyer, Shardul Shroff, Rashesh Shah, Chairman & CEO of Edelweiss Group and Arijit Basu MD of State Bank of India to decode the judgement.

Vakil said, "This is a very big one and this issue now hopefully is put to rest for good. Certainly, this was the architecture of the law from day one, so wonderful that the Supreme Court has put it."

Shroff said, "I think the NCLAT has to go both by letter of the law and the spirit of the law. It is unequivocally clear that the Supreme Court has reiterated the fact that decision of the CoC is final, they have the primacy and there is no authority in the law for NCLAT to substitute the judgement of the CoC by their own judgment."

Basu said, "It is not just about Essar Steel but we feel that it brings in finality to the entire NCLT and the IBC process as was set up in 2016. What was happening was various NCLT courts, various NCLAT courts were giving diverse judgments and which was leading to a lot of confusion."

Shah said, "Though it has taken time, I think in hindsight it is a good thing that it is a very clear cut judgment and the important thing is not only Essar Steel, but there are at least another 8-10 cases which are also hinging upon the same principles which were raised on the Essar Steel case and those will also quickly get released. So, I would think between now to March 2020, there is a fair amount of liquidity that will get released in a lot of these NCLT cases."