7 March 2019: Resolution applicants for Jaypee Infratech — state-run NBCC and Sudhir Valia-promoted Suraksha ARC — have factored in their respective resolution plans the Rs 750 crore deposited by the insolvent developer’s parent firm, which is lying with the National Company Law Tribunal (NCLT) as per the Supreme Court directive.
While Suraksha intends to utilise the fund for construction of the unfinished housing units, NBCC wants to utlise it for payment as penalty to the homebuyers on account of delaying the hand-overs.
Though not clearly objecting to their proposals, in the last meeting of the committee of creditors (CoC), Cyril Amarchand Mangaldas, the law firm advising the lenders, suggested that the two should spell out an alternate resolution plan without factoring in the amount of Rs 750 crore.
The Supreme Court in November 2017 had asked Jaiprakash Associates (JAL), JIL’s parent company, to deposit Rs 2,000 crore in instalments so as to cover part of its subsidiary JIL’s liability towards 30,000 homebuyers. Till May last year, JAL had deposited only Rs 750 crore with the SC registry, which was transferred subsequently to the NCLT.
In relation to 858 acres that was mortgaged for loans by JAL, both the applicants opined that it should vest with JIL. However, the law firm said, “This cannot be a condition or an assumption for the implementation of the resolution plan.”
Separately, in its resolution plan, NBCC has said statutory liabilities, including I-T, GST and stamp duty, which could arise in the future on account of transfer of land shall be borne by the secured financial creditors. Suraksha also suggested that the liabilities should be borne by the lenders.
However, the legal advisor observed that the responsibility and liability for GST, I-T and stamp duty should be with the resolution applicant/JIL and not to the account of the secured financial creditors.
During the course of the CoC meeting, the resolution plan evaluation advisor, RBSA Capital Advisors, pointed out that though Surakhsa has proposed a Rs 3,000-crore capital infusion, the amount is actually far less at Rs 2,450 crore.