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High court rejects Jai Prakash Associates Limited petition of selling land
On December 21, 2019, Yeida cancelled the allotment of 1,000 hectares to JAL after it defaulted on payments amounting to ₹3,621 crore. But JAL did not agree to the amount cited by Yamuna authority and said it owed only ₹1,483 crore to Yeida
The Allahabad high court has rejected Jaiprakash Associates Limited (JAL)’s proposal to sell its land and pay the land cost dues owed to the Yamuna Expressway Industrial Development Authority (Yeida).
Although the plea was rejected by the court on June 13, the order was made public only on Thursday.
The realty firm, in April, had expressed its intention to sell 150 acres along the Yamuna Expressway to raise about ₹1,500 crore to pay the Yeida.However, Yeida objected to the plan on the grounds that the parent company of the group, JAL, has already mortgaged 80 acres, of the 150 acres, to banks and thus the company cannot sell the same to raise funds.
Jayant Bhushan, the advocate appearing for JAL, told the court that JAL should be given more time for settling its dues as it could then free up the 150 acres from encumbrances and sell it.Notably, this land parcel is part of the ”core area” of the Sports City project that is coming up along the Yamuna Expressway.
Sports City is a mega project as part of which a consortium of developers will construct housing units, sports facilities, and commercial spaces.
JAL’s proposal included securing the outstanding amount against 61.41 acres of housing land, 81.75 acres of commercial land, and 5.21 acres of institutional land, totalling 150 acres in the “core area”. The value of the land parcel was estimated to be ₹2,755 crore, and JAL said it intends to sell or sublease the land within a year from the date of the high court order and deposit the proceeds into an escrow account. Yeida will be entitled to withdraw up to ₹1,483 crore from the escrow account, while the remaining amount will remain in the account until the court proceedings are concluded, the company informed the court.
On December 21, 2019, Yeida cancelled the allotment of 1,000 hectares to JAL after it defaulted on payments amounting to ₹3,621 crore. But JAL did not agree to the amount cited by Yamuna authority and said it owed only ₹1,483 crore to Yeida.
Subsequently, the company filed a writ petition in 2020 seeking time to pay the dues. Since then, the case is being heard by the Allahabad high court.
“In view of the above, prayer for a stay made by the petitioner (JAL), to allow it one year time to sell about 150 acres of land in the core area of Sector 25 under SEZ scheme, is declined. The prayer is thus rejected,” said Allahabad high court in its order delivered on June 13 by chief justice Pritinker Diwaker and justice Saumitra Dayal Singh. The order was made public on Thursday.
The Yeida senior officials were not available for comment.
Jaiprakash Associates Limited could not be contacted for comment despite repeated attempts.
It may recalled that it was JAL which built and opened the country’s first Formula One track — the Buddh International Circuit (BIC) — in October 2011.
Designed by German architect and racetrack designer Hermann Tilke, BIC hosted the Formula One Indian Grand Prix from 2011 to 2013. The venue was dropped from the Formula One calendar in 2014.
JAL developed several other sports facilities, including a cricket stadium and other associated buildings for F1 races, on the plot. The company’s infrastructure projects have been mired in controversy with around 6,000 homebuyers and investors struggling to get possession of their units for several years.
Jaypee Infratech Limited, the group’s infrastructure company, has been facing corporate insolvency proceedings since 2017.
