Jaypee Infratech case: IRP files Suraksha’s resolution plan before NCLT

Jaypee Infratech’s Interim Resolution Professional (IRP) Anuj Jain has filed Mumbai-based Suraksha Group’s resolution before the National Company Law Tribunal, IRP told Moneycontrol on July 8.

“An application has been filed before the NCLT which will now hear the matter and approve the Suraksha plan. It may take two to three months for NCLT to approve the plan,” Jain said.

Earlier, in a regulatory filing on July 8, the company informed that the IRP had filed the resolution plan of Suraksha Realty Ltd.

“Pursuant to Regulation 30 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (LODR) and in accordance with the requirements of Schedule III, this is to inform that the Interim Resolution Professional has filed on 07.07.2021, the resolution plan of Suraksha Realty Limited along with Lakshdeep Investments and Finance Private Limited (“Suraksha”) as approved by Committee of Creditors with the Adjudicating Authority i.e. Hon’ble National Company Law Tribunal, Principal Bench, New Delhi,” the regulatory filing said.

On whether the company will draw into the Rs 300 crore interim finance offered by Suraksha in its plan to complete the housing units, Jain said that “if we need the money, it is available and we will draw on it but right now we have funds to execute construction. Interim finance is interest bearing and comes at a cost. We will use it only if we need it.”

“Right now we are sufficiently funded to scale up construction,” he said, adding "we would be utilising the Rs 250 crore available with us to restart work and scale up. We are looking at completing around 3000 new units,” he said.

It must be remembered that Suraksha Group had offered to deposit Rs 300 crore upfront in its bid that was approved by the CoC to ensure construction works do not hamper till the resolution plan gets approved by National Company Law Tribunal (NCLT).

He also confirmed that Suraksha Group has deposited Rs 100 crore as a ‘performance bank guarantee’.

As for the application Jain had filed before the Supreme Court last month seeking an extension of 30 days for completion of the corporate insolvency resolution process by the first week of July, he said that the matter may come up before the apex court soon.

On June 23, the financial creditors of Noida-based Jaypee Infratech Ltd selected Suraksha Group of Mumbai over state-owned NBCC to take over the debt-laden developer and complete the unfinished 20,000 odd-apartments.

Under its plan, Suraksha ARC has proposed to infuse Rs 125-crore worth equity into Jaypee Infratech. It also said that it will avail Rs 3,000 crore in loans to complete construction of the residential units which have been pending for over a decade. It plans to finish construction work within 42 months after taking over Jaypee Infratech.

Suraksha Group has also promised to immediately infuse Rs 300 crore if its bid was approved by the CoC to ensure construction is not hampered while awaiting the NCLT’s approval of the resolution plan. A CoC member had told Moneycontrol that the company hopes to complete around 5000 housing units with this amount.

The company had also promised to form a project wise Monitoring Committee to monitor the progress of construction work and to oversee how funds are being deployed. It has also proposed to develop a mobile application to provide regular construction updates to buyers, the CoC member had said.

A separate escrow account had also been proposed for each project as stipulated under RERA wherein funds from homebuyers would be collected and construction costs borne, the member said.

During the voting on the NBCC and the Suraksha resolution plans to take over Jaypee Infratech from June 14 to June 23, 2021, the Suraksha Group received 98.66 percent of the votes compared with NBCC’s 98.54 percent. Voting started on June 14 and ended on June 23. This was the fourth round of bidding to find a buyer for Jaypee.

This was the fourth round of bidding process.

After the CoC nod, Suraksha group required the approval of the National Company Law Tribunal (NCLT).

JIL went into Corporate Insolvency Resolution Process (CIRP) in August 2017 after the NCLT admitted an application by an IDBI Bank-led consortium.