Supreme Court sets 45-day deadline for resolution plan
The Supreme Court on Wednesday directed fresh consideration of resolution plans for the debt-ridden Jaypee Group within 45 days, saying no new expression of interest will be entertained for taking over the firm and only state-owned NBCC and Suraksha Realty may file revised proposals, giving new hope for the completion of about 22,000 pending flats in Noida and Greater Noida.
The apex court remitted to the Committee of Creditors (CoC) the issue of approval of the resolution plan.
For about 22,000 homebuyers who have invested in the Jaypee Group’s housing projects and are still awaiting possession of their flats, the judgment has heightened hopes of an early resolution, even as there is no end in sight to the corporate insolvency resolution procedure (CIRP) of Jaypee Infratech Limited (JIL), pending before the National Company Law Tribunal (NCLT) since 2017.
A bench of justices AM Khanwilkar, Dinesh Maheshwari and Sanjiv Khanna, in its 375-page judgment, said: “We are conscious of the requirements of the discipline of Insolvency and Bankruptcy Code (IBC) and would hasten to observe that the course which is being adopted is in the complex and peculiar features of this case but, this repeat exercise concerning the CIRP of JIL cannot be an unending process and needs to be taken to its logical conclusion.”
In exercise of its extraordinary powers under Article 142, the apex court directed NBCC and Suraksha Realty to submit fresh resolution plans in two weeks and directed the Committee of Creditors (which also has homebuyers) to consider it and submit a report to the adjudicating authority within an extended period of 45 days beginning Wednesday.
Since August 2017, when JIL went into the insolvency process after NCLT admitted the application by an IDBI Bank-led consortium, this is the fourth round of litigation which has been decided by the apex court. On March 3 last year, NCLT approved NBCC’s bid to acquire JIL through the insolvency process and complete over 20,000 pending flats over the next three and half years. The order was, however, challenged in the appellate tribunal NCLAT and later in the Supreme Court.
NCLAT had asked NBCC to implement its proposal to acquire debt-ridden JIL and complete over 20,000 pending flats, but said that its direction was subject to its final order.
Last year, the Supreme Court withdrew to itself all matters pending before the NCLT and NCLAT after NBCC objected to modification in its resolution plan by the NCLT, which was later challenged by it before NCLAT. The court heard NBCC, homebuyers and other stakeholders, including the Jaypee Group, before reserving order on the way forward in October 2020.
Homebuyers said that after a long wait, the order passed by the court was not on expected lines. “After so many months, we expected the court to give us a solution. The court held that ₹750 crore deposited by Jaypee Associates Limited could not be part of the resolution plan of NBCC as it was property of JAL. They should have ordered the same to be given towards construction of JAL housing projects,” said Arvind Verma, president of Knight Court Social Welfare Association, a housing project of JAL.
With PTI inputs