Says Jaypee buyers strongly believe that there are several instances that prove that their money was diverted and used for other purposes.
Stating that homebuyers stuck in Jaypee Infratech's projects continue to feel "cheated and harassed", the homebuyers' authorised representative has recommended to the IRP to include the issue of forensic audit of JIL's accounts since its inception in the agenda of the committee of creditors meeting.
The 14th CoC meeting is scheduled for November 18.
The issue of comprehensive forensic audit of the corporate debtor since inception is one of the basic demand of the majority of homebuyers which forms part of 58.22 percent of the total COC in terms of voting percentage, the letter written by Jaypee homebuyers' representative Kuldeep Verma to the Interim Resolution professional Anuj Jain, said.
"… majority of home buyers strongly believed that prima facie there are lot of glaring instances which proves that money given by homebuyers to corporate debtor were diverted and used for purposes other than with the objective which was only construction of homes for homebuyers.
"Homebuyers continue to feel cheated and harassed as their hard-earned money is allegedly diverted and percentage of completion of projects is not directly proportionate to payments made by respective home buyers. The difference in certain projects is very huge and still there is no proper reasonable answer acceptable to homebuyers.
"The corporate debtor did not honour its commitment. The CA certificate provided is probably a statement of fact at macro level with absolutely no finer details of utilisation of money over a period of time and home buyers still feel that a more comprehensive forensic study is the need of the hour wherein there is a huge possibility of fraudulent trading or wrongful trading.
Buyers have mentioned that in view of new amendment to IBC 2016 the agenda for a comprehensive forensic audit of Jaypee Infratech Limited need to be voted again. Hence you are requested to include an agenda for voting of comprehensive forensic audit of the corporate debtor and put the same agenda for voting of the COC in the forthcoming meeting, being 14th meeting of the Committee of Creditors which is scheduled on 18.11.2019, the homebuyers' representative's letter said.
Homebuyers stuck with incomplete houses in Jaypee projects had written to their representative, authorised to attend the committee of creditors meeting, to include in the agenda the issue of forensic audit of JIL's accounts since its inception in 2009.
"We request you to instruct Anuj Jain, IRP-JIL to include an agenda item in 14th CoC to be held on 18th Nov 2019 titled 'Forensic Audit of JIL since inception Y2009' to unearth homebuyers' money to activities other than construction. The issue was put to vote at the 6th CoC and now in view of new IBC amendment, this agenda item should be again put to vote immediately," the letter sent earlier this week had said.
An audit was conducted by TR Chadha and Co LLP but it pertains to the period 2014-2017 period, while the majority of the homebuyers paid their amounts during the 2009-2013 period.
"Both these periods are not comparable and just an eye wash to confuse the home buyers. A critical analysis of the publicly available documents of JIL and JAL was commissioned by 9Associations of home buyers. This report by ASA India Financial Advisory Services LLP was shared with IRP-JIL earlier. It points to various instances of diversion of homebuyers’ money to activities other than construction mainly through related party transactions and inflated or gold plating of contracts. This report has also been submitted to Hon’ble Supreme Court in Nov 2017," the buyers' letter had noted.
Lenders of debt-ridden Jaypee Infratech will meet on November 18 to take forward the process of insolvency resolution following the Supreme Court’s directions on November 6 that the Jaypee Infratech insolvency process should be completed within 90 days and that only the government’s construction arm NBCC and Suraksha Realty be allowed to submit their revised proposals before the Committee of Creditors.
Jaypee Infratech informed exchanges on November 13 that "a meeting of Committee of Creditors (CoC) will be held on November 18, 2019".
The agenda of the meeting is to discuss the “Resolution Plans of NBCC (India) Limited and Suraksha Realty Limited expected to be received on November 16, 2019 amongst CoC members followed by discussion with representatives of NBCC and Suraksha and the next steps…Any other matter that may be raised by the member of the CoC,” the notice had said.
As many as 13 banks and over 23,000 homebuyers have voting rights in the CoC Committee of Creditors (CoC) of Jaypee Infratech.
The Supreme Court on November 6 had ruled that the Jaypee Infratech insolvency process should be completed within 90 days and allowed the government’s construction arm NBCC and Suraksha Realty to submit their revised proposals before the Committee of Creditors.
A total of 90-day extension has been granted by the apex court under extraordinary powers of the Supreme Court under Article 142. The apex court also clarified that this case should not set a precedent.
The apex court made it clear that the parent company of the embattled firm JP Associates cannot bid for Jaypee Infratech. On July 30 this year, the National Company Law Appellate Tribunal (NCLAT) had allowed fresh bidding for the cash-strapped JIL but had barred its promoter Jaypee Group from participating in the auction.
The apex court said the pendency of any other application before the NCLT or NCLAT, including any interim direction, shall be no impediment for the IRP to receive and process the revised resolution plan from the two bidders.
A bench of justices AM Khanwilkar and Dinesh Maheshwari said it is passing directions in an "exceptional situation" to do complete justice to home buyers, Jaypee group and banks concerned.
Crisis-hit Jaypee group firm Jaypee Infratech went into insolvency in 2017 after the National Company Law Tribunal (NCLT) admitted an application by an IDBI Bank-led consortium seeking resolution of the firm. Jaypee Infratech, a subsidiary of Jaiprakash Associates, has an outstanding debt of nearly Rs 9,800 crore.
Interim Resolution Professional (IRP) Anuj Jain, in October 2018, started a fresh initiative to revive Jaypee Infratech on the NCLT's direction. In the second round, lenders first rejected bid of Suraksha Realty and then that of state-owned NBCC.
In the first round of insolvency proceedings, the Rs 7,350 crore bid of Lakshdeep, part of Suraksha Group, was rejected by email@example.com Are you happy with your current monthly income? Do you know you can double it without working extra hours or asking for a raise? Rahul Shah, one of the India's leading expert on wealth building, has created a strategy which makes it possible... in just a short few years. You can know his secrets in his FREE video series airing between 12th to 17th December. You can reserve your free seat here.