The Supreme Court on Wednesday asked directors of Jaiprakash Associate Limited to submit the details regarding the company's ongoing housing projects in the country. With the current order, the apex court seems to be taking steps to ensure the beleaguered company does not make any excuse to deposit the assured money of Rs 125 crore, the deadline for which was extended till January 25 from December 31 last month. However, the counsels representing Jaypee assured the SC bench that they had sold some company properties and the loan restructuring process was on.
The bench headed by Chief Justice Dipak Misra reiterated its earlier order, and refrained the company directors from selling their personal assets. It said the Reserve Bank of India's request for nod on filing insolvency proceedings would be considered later. Besides, the bench exempted the company directors from appearing on every hearing on the grounds of their old age, as requested by the counsel of the company's independent directors. To protect the interest of buyers, the bench has asked amicus curie Pawan Shree Agrawal to set up a portal where all grievances of home buyers would be noted. The step would help keep a tab on number of complaints against Jaypee facing insolvency proceedings.
On the request of senior advocate Ranjit Kumar, who appeared for the independent directors of JAL, the SC bench exempted them from appearing for every hearing but reiterated they could not leave the country without the apex court's permission. The bench also said they couldn't sell off their personal assets or create third-party interest. The top court had earlier said any violation of its directive would hold them liable for criminal prosecution and contempt action.
The Supreme Court had passed an interim order in September 2017 directing JAL to deposit Rs 2,000 crore with the court registry in relation to the insolvency proceedings pending against its subsidiary, Jaypee Infratech Limited. The top court, however, had given the company the option of depositing the above amount in instalments. So far, the company has deposited only Rs 450 crore with the court.
Flat buyers, under the Insolvency and Bankruptcy Code of 2016, do not fall in the category of secured creditors like banks and hence can get back their money only if something is left after repaying the secured and operational creditors, reported PTI. Considering the law - which seems to be first securing the investments made by secured creditors like banks - over 32,000 homebuyers who had also invested in the company by buying Jaypee flats could lose money.
IDBI Bank, the largest creditor of Jaypee Infratech Ltd and the leader of the consortium of lenders to the Jaypee Group, had dragged to the National Company Law Tribunal (NCLT) on August 10, 2017, to initiate the insolvency proceedings to recover its Rs 546 crore loan. Later, several homebuyers had moved the Supreme Court against the company to get back their money. Hence, the top court had put a stay on the insolvency proceedings on September 4, 2017.
With PTI inputs