Jaypee Infratech insolvency: NCLAT extends resolution period of debt-ridden company by 90 days

New Delhi: The National Company Law Appellate Tribunal on Tuesday extended the resolution period of Jaypee Infratech for another 90 days, which includes a 45-day window for the resolution professional and lenders of the debt-ridden firm to invite fresh bids.

The Committee of Creditors and the resolution professional would have 45 days to consider the resolution plans and select a final bidder to complete the process.

A two-member bench headed by Chairman Justice S J Mukhopadhaya said that as Corporate Insolvency Resolution was pending for a long time, it would give only 45 days to Resolution Professional (RP) and the Committee of Creditors (CoC) of the Jaypee Infratech to complete the process of inviting new bids.

It also granted another 45 days to the RP and the CoC to finish the entire process of selecting a final bidder.

"In view of aforesaid extraordinary situation, we are of the view that the period from 17th September 2018 i.e the date of application filed by the Association of the allottees for clarification for the order and till the final decision i.e. 4th June 2019 can be excluded for the purpose of counting the 270 days," the NCLAT said.

 Jaypee Infratech insolvency: NCLAT extends resolution period of debt-ridden company by 90 days

Representational image. Reuters.

However it also said that as the matter is pending since long, it was "not inclined to exclude the total period of 260 days and instead in the interest of the Allottees, we exclude 90 days for the purpose of counting the period of 270 days of ‘Corporate Insolvency Resolution Process', which should be counted from the date of receipt of the copy of this order."

The said period is to enable the RP and the CoC to call for "fresh ‘resolution plans' and to consider them" within a "period of 45 days," the NCLAT said.

The appellate tribunal further added: "Rest of the period of 45 days margin is given to remove any difficulty and appropriate order as may be passed by the Adjudicating Authority (NCLT)."

The appellate tribunal has also rejected the plea of Jaiprakash Associates Ltd, the promoters of Jaypee Infratech, to be eligible to submit a bid.

"No liberty is given to ‘Jaiprakash Associates Ltd.', in view of the aforesaid observation and decision of Hon'ble Supreme Court in ‘Chitra Sharma' (Supra)," it said.

The NCLAT had asked state-owned NBCC, whose bid was rejected by the CoC of Jaypee Infratech, to submit fresh resolution plan for the debt-ridden company.

"It is made clear that all the earlier ‘resolution plan(s)' including the plan submitted by the NBCC, can not be considered, having been rejected by the CoC. However, it will be open to the ‘NBCC' to file a fresh improved ‘resolution plan," it said.

Meanwhile, the NCLAT also did not express any opinion over the bid to be filed by Adani Infra for Jaypee Infratech.

"It is informed that ‘Adani Infra also proposed to file ‘resolution plan' but we are not expressing any opinion with regard to the same," said NCLAT.

Lenders were requesting to exclude the 250 days from 17 September, 2018, to 4 June, 2019, from the stipulated period for Corporate Insolvency Resolution Process (CIRP), as this time was taken by the National Company Law Tribunal (NCLT) to decide on the voting rights of the homebuyers.

Updated Date: Jul 30, 2019 18:54:03 IST