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Jaypee infratech case: Financial creditors vote for allowing more time to NBCC, Suraksha Group to submit revised bids

Jaypee Infratech’s creditors, on May 27, started voting on a proposal to give a seven-day extension to NBCC and Suraksha Group to submit revised plans to take over the embattled firm and complete construction of around 20,000 homes that have been delayed by almost a decade. The process ended on May 28.

On May 23, the Chairman of Jaiprakash Associates (JAL) Manoj Gaur wrote a letter to the IRP

On May 23, the Chairman of Jaiprakash Associates (JAL) Manoj Gaur wrote a letter to the IRP


Jaypee Infratech’s Committee of Creditors have voted for extending the bidding process and allowing both the government’s construction arm NBCC and Mumbai-based Suraksha Group to submit their revised bids by June 4.

The deadline for submission of the final bids is June 4 and resolution plans should be compliant with insolvency laws and a Supreme Court judgment dated March 24, sources said.

Jaypee Infratech’s creditors on May 27 started voting on a proposal to give a seven-day extension to NBCC and Suraksha Group to submit revised plans to take over the embattled firm and complete construction of around 20,000 homes that have been delayed by almost a decade. The process concluded on May 28.

Sources said that members representing 98.54 per cent of the voting rights gave their assent to the proposal to provide a final opportunity to both the resolution applicants to submit their revised bids within seven days.

Over 20,000 homebuyers have 56.61 per cent voting rights in the Committee of Creditors (CoC) and that of Fixed Deposit Holders is 0.13 per cent. As many as 13 banks have 43.26 per cent voting share.

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IRP Anuj Jain is also expected to now file an application with the Supreme Court to seek a 30-day extension until July 7 to complete the corporate insolvency resolution process.

The CoC also passed the resolution to convene meetings at short notice of 24 hours. It should be remembered that on May 23, Jain informed shareholders that a meeting of the CoC is scheduled on May 24.

It also decided to favour the tie-breaker formula in case plans submitted by both the bidders get equal votes, sources said.

The CoC, on May 24, decided to provide another opportunity by way of additional time of seven days, to both the resolution applicants i.e. NBCC and Suraksha to submit their revised Resolution Plans in accordance with the provisions of the Code and the CIRP Regulations and the Supreme Court judgment dated March 24, 2021.

It also proposed that fresh plans be invited from both the resolution applicants besides asking the IRP to file an application on behalf of CoC before the Supreme Court to seek further additional time of 30 days until July 7, 2021, to complete the Corporate Insolvency Resolution Process of Jaypee Infratech Limited.

The committee of creditors of debt-ridden Jaypee Infratech also met on May 24 to discuss the addendum to its final bid filed by the NBCC.

The IRP was of the view that both the NBCC’s proposals offering dissenting financial creditors (DFCs) non-convertible debentures for payment of liquidation value and the proposal offering Guarantee Security Interest and Promoter Security Interest for payment of liquidation value, was not in accordance with the Insolvency and Bankruptcy Code (IBC).

NBCC filed an addendum to its bid and also wrote a letter to the Interim Resolution Professional (IRP) Anuj Jain on May 24, drawing his attention to the legal opinion taken from retired judge Justice AK Sikri, which was submitted along with the NBCC’s Resolution Plan dated May 18, 2021.

It even questioned Anuj Jain’s jurisdiction in rejecting its offer.

The government’s construction arm NBCC on May 26 has said that its resolution plan for taking over of the embattled firm Jaypee Infratech was ‘legally compliant’ and that if it is permitted to submit a fresh bid, it will attempt to answer all objections raised by the interim professional Anuj Jain.

On May 23, the Chairman of Jaiprakash Associates (JAL) Manoj Gaur also wrote a letter to the IRP urging him to consider JAL's settlement offer, which was submitted before the Supreme Court in 2019.

On May 26, Suraksha group urged homebuyers to support its resolution plan and vote against a proposal to allow more time for submission of new offers by the company and NBCC. In a video message on YouTube, Suraksha ARC managing director and chief executive officer Aalok Dave told homebuyers that "we should be your first preference and not standby option".

Suraksha’s Resolution Plan submitted with changes to Anuj Jain on May 18 was found to be compliant with the provisions of the IBC and corporate insolvency resolution process regulations, as well as the Supreme Court directions on the Jaypee matter.

The 21st meeting of the CoC was held on May 20. This is the fourth round of the bidding process.



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Vandana Ramnani
first published: May 29, 2021 01:34 pm
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