Over 2,000 home buyers still stranded as Jaypee Infra’s insolvency case lurches towards a resolution

HOPE FOR RELIEF

Some relief has appeared on the horizon in the form of the National Company Law Tribunal (NCLT). After the Supreme Court order, home buyers have approached the NCLT, which has asked the IRP to consider the claims of those who have not filed their claims.

A property buyer, who is on the verge of losing his home due to non-filing of claim, told Moneycontrol: “As per the advice dated 22.08.2017 issued by IBBI (Insolvency and Bankruptcy Board of India) to the IRP in a frequently asked questions (FAQ) on the website of the corporate debtor, it was revealed that if a homebuyer was unable to file his/her claim, then the IRP would consider the claims on the basis of the company’s record (SOA) and books of account and decide after its verification. Relying on this, many homebuyers were convinced that no claim is required to be filed as it would be taken as per SoA, as mentioned in the FAQ.”

Obviously, that is not what has happened. According to the home buyer, ``the Creditor of Committee has decided that claims received from home buyers and FD holders after December 6, 2019 be forwarded to both the resolution applicants, namely NBCC (India) Limited, Suraksha Realty Limited and Lakshadweep Investments and Finance Private Ltd for consideration”.

NBCC BACKS OUT

A source close to development told Moneycontrol that in view of the ``said SC order, one of the resolution applicants, NBCC, has chosen not to provide anything for unclaimed home buyers as well as for those who have filed their claims after stipulated time. The other buyer, Suraksha, seems to have made a provision for those home buyers who will file their claims until the date of approval of the final resolution plan by NCLT”.

Jaypee Infrastructure Limited sold property to around 20,000 home buyers, but never delivered. After 12 years of litigation, some hope appeared to be emerging of getting what was due, but the apex court’s observations have put paid to their expectations.

A home buyer told Moneycontrol: “It is not clear whether the IRP informed the SC about the FAQ issued in 2017 and that after issuing such FAQ to general public, he has neither acted upon nor has he removed the said FAQ from the official website of the corporate debtor, which can still be accessed”.

PAYMENTS CONCLUDED

According to him, most home buyers have made more than 90 percent of the payment and some even have paid the entire amount. ``This amount will stand forfeited and they will not be entitled to any refund,” the distraught home buyer said.

Another home buyer told Moneycontrol: ``Most importantly, the selected resolution applicant, NBCC or Suraksha, shall stand to gain as they shall be almost free to sell these forfeited homes at revised prices to anyone else and pocket 100 percent profits as they are getting these homes at zero cost”.

Several calls and messages to IRP went unanswered and NBCC also did not reply to mail sent by Moneycontrol.

BACKGROUND

It all started when the IDBI Bank-led consortium of lenders of JIL, the corporate debtor, approached the National Company Law Tribunal (NCLT) in 2017 seeking resolution of a bankrupt Jaypee Infratech.

The NCLT appointed an Insolvency Resolution Professional or IRP to revive the corporate debtor.

In this process, the IRP through public notices invited claims from creditors as well as home buyers.

As per the advice dated 22.08.2017 issued by IBBI to the IRP in a FAQ on the website of the corporate debtor, it was revealed that if a homebuyer was unable to file his/her claim then the IRP would consider the claims on the basis of the Company’s record (SOA) and books of account and decide after its verification.

Many homebuyers were convinced thereafter that no claim was needed to be filed as it would be taken as per SoA, as mentioned in the FAQ, leading to this colossal mix up.