Jaypee Infratech’s creditors on May 27 started voting on a proposal to give a seven-day extension to the government’s construction arm NBCC and Mumbai-based 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 voting to get the consent of homebuyers and lenders on the issue will continue until Friday (May 28). Homebuyers hold 57% voting rights in the process to select the bidder for the embattled firm.
The CoC on May 24 decided to provide another opportunity by way of additional time of seven days (till 5 pm on 04.06.2021), 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 had 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.
If the revised bids by both the applicants are not allowed by the Committee, then Suraksha’s plan, on which voting was deferred on May 24, will be put to vote.
In case the CoC does not approve the proposal by a requisite majority, voting on Suraksha Plan in terms of CoC decision in the meeting held on May 20, 2021, which was deferred on May 24, would resume on May 31 and continue till June 3, the CoC had decided on May 24.
The voting is also to seek a tie-break formula.
The voting is being conducted through the Central Depository Services (India) Limited platform on www.evotingindia.com for all the CoC members that include banks, financial institutions, homebuyers and FD holders.
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 had filed an addendum to its bid and also written 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.
Earlier, over the weekend, it had 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 had also written 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 You Tube, Suraksha ARC managing director and chief executive officer Aalok Dave told homebuyers that "we should be your first preference and not standby option."
Based on his discussions with lenders,
Dave said banks are in favour of resolution and they will vote for a plan that is compliant and better for them on merit.
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