Jaypee Infratech Homebuyers Move Supreme Court Challenging NCLAT Order Which Allowed Fresh Bidding

Clients who had purchased homes from Jaypee Infratech (JIL) have moved the Supreme Court, challenging an National Company Law Appellate Tribunal (NCLAT) order which had allowed fresh bidding for the debt-laden real estate firm and also barred its original promoters from participating in any fresh auction.

In this connection, it may be recalled that JIL’s parent company Jaiprakash Associates (JAL), and Manoj Gaur, CMD of the suspended management of JIL, had also challenged the NCLAT’s order which had allowed fresh bidding for the firm.

Earlier, the Supreme Court had restrained the Committee of Creditors (CoC) of JIL from inviting fresh bids for two weeks and had asked for maintaance of the status quo after the government counsel informed the court that proposed amendments to the Bankruptcy Code were being notified soon.

More than 1,100 home buyers of various JIL projects stated in their petition that the NCLAT extended the Corporate Insolvency Resolution Period (CIRP) of JIL for another 90 days so as to invite fresh bids for the debt-laden firm, without even considering all other proposals.

According to home buyers, the NCLAT order amounted to usurping the powers of the NCLT, CoC and resolution professional at a time when the statutory period for completion of CIRP as stipulated under the IBC had expired.

Home buyers have urged the Supreme Court to do justice by inviting bids in the court itself in order to get rid of cumbersome process of litigations and proceedings before the CoC, NCLT, and NCLAT.

They stated that JAL had submitted its proposal to the CoC under Section 12A of the IBC for consideration and withdrawal of CIRP. Though the proposal given by JAL was completely in favour of all financial creditors which included homebuyers, it was not considered, the home buyers stated.