NCLAT calls stakeholders on July 17 to discuss NBCC plan again, says no other plan should be considered for now Aashish Aryan | New Delh
NCLAT calls stakeholders on July 17 to discuss NBCC plan again, says no other plan should be considered for now
Aashish Aryan | New Delhi
Last Updated at July 2, 2019 18:15 IST
The insolvency resolution of Jaypee Infratech Limited (JIL) is back to the drawing board after the National Company Law Appellate Tribunal (NCLAT) on Tuesday asked representatives of all stakeholders including banks, homebuyers and fixed deposit holders to restart discussions on the bid submitted by NBCC (India).
The NCLAT has called all the representatives for another round of discussion on July 17 after it was informed that the 13 banks, which are lenders to JIL, had rejected the plan submitted by NBCC and some homebuyers had abstained from voting.
On Tuesday, the Resolution Professional (RP) of JIL informed the NCLAT that of the total votes polled on NBCC’s plan, nearly 34.75 per cent of homebuyers had voted in favour, while 1.44 per cent had voted against. As much as 23.8 per cent of the homebuyers had abstained from the voting process, the RP of JIL told NCLAT. The homebuyers comprise of as much as 59 per cent of the Committee of Creditors (CoC) of JIL.
The 13 banks, which make up the other 40.75 per cent of the CoC, had all voted against NBCC’s bid for the company, the RP said. Voting on NBCC’s bid for JIL had started on May 31 and ended on June 10.
On July 17, the NCLAT said it would hear the banks on the issues they had against NBCC’s plan and whether they could modify it appropriately so that it could meet the needs of all the stakeholders. It has asked the banks to nominate one high ranking officer from any one bank, who could represent all the 13 lenders of JIL.
The banks will also have to produce a gist of the resolution plan submitted by NBCC and objections they have with regard to it on the next date, the appellate tribunal said.
During the hearing on Tuesday, a three-member bench led by Chairperson Justice S J Mukhopadhaya also observed that only NBCC’s plan should be considered at this stage as it was “a government company and one could rely on it”. The observation by NCLAT came after the banks requested that the appellate tribunal should allow them to call for and consider other bids, including the one by Adani as it was offering more money and had promised to complete the pending projects of JIL in nine months.
The proposal however ticked off the NCLAT which observed that banks should not engage in “backdoor” negotiations with the Adani group. If the group had a good proposal to finish the project, it should file and intervention application and appear before the appellate tribunal, the three-member bench said. The Adani group, the appellate tribunal observed, does not have relevant experience in the infrastructure space and hence should not be considered at this stage.
Only if the resolution plan submitted by NBCC failed to make any headway despite NCLAT’s intervention, other plans including the one submitted by Adani would be considered, Justice Mukhopadhaya said.
NBCC, while bidding for JIL, had asked to be exempted from income tax liability as well as from taking consent of development authorities for transfer of businesses. It had also not agreed to change its proposal that lenders take unsold flats in case the state-owned firm fails to sell them in the market.
JIL was taken to the National Company Law Tribunal (NCLT) by an IDBI Bank-led consortium for failing to repay debt worth nearly Rs 24,000 crore. In the first round of insolvency proceedings conducted last year, the Rs 7,350-crore bid of Lakshdeep, part of Suraksha Group, was rejected by lenders. In October 2018, the RP of the company started a second round of bidding to revive JIL.
First Published: Tue, July 02 2019. 18:13 IST