NCLAT admits banks’ petition over Jaypee Infratech land

The NCLAT was hearing the appeal over the order of the Allahabad bench of the NCLT, which had asked debt-ridden Jaiprakash Associates Ltd to return nearly 760 acres of land to its subsidiary Jaypee Infratech.

The National Company Law Appellate Tribunal on Thursday admitted a petition filed by banks against the NCLT order which had directed Jaiprakash Associates to return nearly 760 acres of land to its subsidiary Jaypee Infratech.

Tower cranes operate in a residential building construction site at a Jaypee Infratech Ltd project in Noida, Uttar Pradesh. (Prashanth Vishwanathan/Bloomberg)

A two-member bench headed by Chairman Justice S J Mukhopadhaya also issued notices to the resolution professional (RP) of the company over the petition filed by three lenders -- Axis Bank, Standard Chartered Bank and ICICI Bank. The bench fixed July 13 as the next date of hearing.

During the proceedings, the appellate tribunal observed that the adjudicating authority (NCLT) does not have jurisdiction to declare any instrument illegal.

NCLAT was hearing the appeal over the order of the Allahabad bench of the National Company Law Tribunal (NCLT), which had asked debt-ridden Jaiprakash Associates Ltd to return nearly 760 acres of land to its subsidiary Jaypee Infratech, declaring the transfer of the land as “fraudulent” and “undervalued”.

NCLT had directed JP Group’s flagship firm Jaiprakash Associates Ltd (JAL) to release and discharge interest created over the land to lenders including ICICI Bank.

The order had come on a petition filed by Jaypee Infratech’s resolution professional (RP) Anuj Jain in the NCLT seeking direction over transactions entered into by the company’s promoters creating mortgage on 858 acres of land to secure debt for JAL.