23 July 2019: With a view to wrest back control of its insolvent subsidiary Jaypee Infratech (JIL) under the provisions of Insolvency and Bankruptcy Code (IBC), which allows lenders to withdraw an insolvency petition, parent Jaiprakash Associates (JAL) on Monday said it would repay creditors their entire dues and hand over flats to homebuyers in three years.
JAL’s proposal is better than Suraksha and NBCC, who have evinced interest in JIL. So, the committee of creditors (CoC) should consider its offer under section 12A of the IBC, JAL’s counsel said before the National Company Law Appellate Tribunal (NCLAT).
JIL has Rs 9,800 crore outstanding to 13 banks. It is also required to complete around 20,000 flats and hand them over to buyers.
The two-member NCLAT Bench, headed by chairman Justice SJ Mukhopadhaya, has agreed to hear JAL’s plea. The counsel alleged that a proposal was made earlier before the CoC to withdraw the insolvency appeal, but it had fallen on deaf ears.
The NCLT allows withdrawal of an application admitted under section 7,9 or 10 of the IBC with the approval of 90% voting share of the CoC. JAL does not want liquidation of the company. It also does not want extension of the time period for the ongoing Corporate Insolvency Resolution Process (CIRP), the counsel said.
The NCLAT Bench has asked JAL to file written submissions over exclusion of time frame. It has scheduled the matter for “orders” on July 29.
On an application filed by a consortium led by IDBI Bank, JIL was admitted for initiation of insolvency process on August 2017. In the first round of insolvency proceedings conducted last year, the `7,350-crore bid of Lakshadweep, part of Suraksha Group, was rejected by lenders.
Later in October 2018, the IRP started the second round of bidding process. In all, five companies had submitted expression of interests, but only Suraksha and NBCC submitted financial bids. The CoC has rejected both the bids.