Insolvency proceedings for Jaypee Infratech, which were restarted by the Supreme Court on August 9, 2018 have crossed 330 days, the time limit proposed in the cabinet-approved amendments to the Insolvency and Bankruptcy Code. Jaypee Infratech has failed to deliver around 23,000 flats and owes over Rs 9,800 crore to lenders.
Lenders and homebuyers have supported the proposed exclusion with a view to allow new bidders to participate in the resolution process after the committee of creditors (CoC) rejected a resolution plan by the government-owned NBCC with banks voting against the plan unanimously. Jaiprakash Associates Ltd (JAL) — the parent company of Jaypee Infratech — has however opposed the proposed exclusion period as it may be allowed to retake control of the company by reaching an agreement with the creditors if the corporate insolvency resolution process fails and the company goes into liquidation.
“We are willing to pay creditors 100% of their dues and provide the flats to all homebuyers in three years” said counsels for JAL, adding later that it would also pay damages for the delay to the homebuyers and offer free maintenance for one year and that their application to resolve the claims against Jaypee Infratech had not been considered by the committee of creditors.
Adani Infrastructure has also expressed interest in taking over debt-laden Jaypee Infratech with an informal proposal that offered to begin delivery of flats in nine months with a fresh equity infusion of Rs 1,700 crore and Rs 1,000 crore to settle the dues of employees and financial creditors.
NCLAT is set to pass orders on the matter on July 29. However, these orders are not likely to be affected if the proposed 330-day limit is passed into law before that date, said experts.