Supreme Court Reserves Order On Jaypee Plea Against NCLAT Verdict 
Laborers stand outside the Jaypee Wish Town Project, developed by Jaypee Infratech Ltd., in Noida. (Photographer: Prashanth Vishwanathan/Bloomberg)

Supreme Court Reserves Order On Jaypee Plea Against NCLAT Verdict 

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The Supreme Court Wednesday reserved order on the Jaypee Group plea against the National Company Law Tribunal verdict, which barred it from participating in the auction of its debt-ridden group firm, Jaypee Infratech Ltd.

The group said it has built and delivered around 6,000 dwelling units to homebuyers during the insolvency proceedings. On July 30 this year, the NCLAT had allowed fresh bidding for the cash-strapped JIL but had barred its promoter Jaypee Group from participating in the auction.

The bench comprising Justices AM Khanwilkar and Dinesh Maheshwari was told by senior advocate FS Nariman, appearing for the real estate firm, that around 12,000 flats or dwelling units have been delivered to the homebuyers, and of the total around 6,000 have been given during the tough times of facing the insolvency proceedings.

Nobody said that we swallowed the money (of homebuyers).
Senior Advocate FS Nariman

In response to a query from the bench as to whether the firm would be able to get the statutory approval of 90 percent members of the Committee of Creditors to bid for its ailing group firm, JIL, Nariman said that he cannot guarantee this. But, the proposal of the company does not contain any "hair cut" and rather, it has offered sops to the homebuyers.

The counsel for the homebuyers opposed the plea and said they have been waiting for the last 10 years and wanted their homes and the issue that whether they are built by the Jaypee group or by the National Buildings Construction Corporation Ltd. was immaterial for them. The bench has now fixed the matter on Nov. 6 when it will pronounce its order on the plea of the Jaypee group.

The apex court had earlier said it would first hear the appeal of Jaypee Group against the NCLAT order that barred it from participating in the auction of JIL and would deal later with the revised proposal of state-owned NBCC to complete the stalled projects of Jaypee Group to address grievances of harassed home buyers.

The NBCC, in pursuance of an earlier order of the apex court, had submitted a revised plan in a sealed cover on the issue of taking over the stalled housing projects of JIL to ensure that hassled home buyers get their dream homes.

The court, however, had not opened the seal of the revised plan and told that it would deal with it later.

On Sept. 3, the apex court had sought to know from NBCC whether it was willing to give a revised proposal to complete the stalled projects of cash-strapped Jaypee group even as the Centre said it has to step in because "a mess has been created by the promoter".

The top court had said if NBCC, which saw two of its proposals rejected earlier by lenders of the defaulting Jaypee group, is not willing to submit a revised plan, then it may look for other alternatives.

The cash strapped company had further said that it may not have any objection if the NBCC is allowed to give a revised proposal, but Jaypee Group should also be allowed to give a fresh proposal as it is wiling to pay all its dues to lenders and finish all the stalled projects within a period of three years.

On July 30, the NCLAT had allowed fresh bidding for the cash-strapped Jaypee Infratech but barred its promoter Jaypee Group from participating in the auction.

To enable the fresh bidding process, the NCLAT extended the resolution period of JIL for 90 days, which includes a 45-day window for the resolution professional and lenders of the debt-ridden firm to invite fresh bids.

The NCLAT direction came in view of lenders rejecting the resolution plan NBCC and Suraksha Realty in the second round of bidding. Jaypee Infratech went into insolvency in August 2017 after the NCLT admitted an application filed by an IDBI Bank-led consortium.

In the first round of insolvency proceedings conducted last year, the Rs 7,350-crore bid of Lakshadweep, part of Suraksha Group, was rejected by lenders. The NCLAT had asked state-owned NBCC, whose bid was rejected by the CoC of Jaypee Infratech, to submit fresh resolution plan for the debt-ridden company.

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