India's National Company Law Tribunal (NCLT) yesterday issued the much-awaited verdict in Jaypee Infratech Ltd.’s insolvency resolution, and approved the bid of Suraksha Reality and Lakshdeep Investments & Finance Private Ltd.

Jaypee Infratech was undergoing a corporate insolvency resolution process (CIRP) since 9 August 2017.

Suraksha Reality-Lakshdeep Investments consortium’s offered a total of 20,363.36 crore rupees ($2.50 billion) under the resolution plan of the company.

Following are the key highlights from the NCLT’s order:

Key NCLT Orders

• The NCLT passed the order related to reconciliation of 750 crore rupees deposited by the company’s parent Jaiprakash Associates Ltd. and interest thereon between Jaypee Infratech/its homebuyers and Jaiprakash Associates.

• The NCLT rejected the objections raised by Yamuna Expressway Industrial Development Authority (YEIDA), ICICI Bank, and Jaiprakash Associates along with Manoj Gaur against the resolution plan.

• The NCLT directed to set up a monitoring committee within seven days. The committee will take all necessary steps for expeditious implementation of the approved resolution plan.

• The NCLT directed Suraksha Realty to deliver/provide possession of the units to the homebuyers/allottees strictly as per the timeframe promised in the resolution plan.

• The monitoring committee will supervise and monitor the progress of construction of units and related infrastructure developments on a day-to-day basis and file the monthly progress report with the NCLT.

• The Interim Resolution Professional Anuj Jain will stand discharged from his duties immediately after constituting the monitoring committee.

• Suraksha sought several reliefs and concessions under the resolution plan. However, the NCLT granted only a few and directed that even if no reliefs and concessions are granted it will still implement the plan.

Below are the key highlights from Suraksha Reality-Lakshdeep Investments consortium’s resolution plan.

Resolution Plan Highlights

• Following the approval of resolution plan by the NCLT, the issued, subscribed and paid-up share capital of Jaypee Infratech, including preference shares, if any, will be canceled and reduced in its entirety.

• The cancellation of the issued, subscribed and paid up share capital of Jaypee Infratech, including preference shares, if any, will be affected as part of the NCLT’s order approving the resolution plan.

• The share certificate held by the company’s shareholders will stand canceled on the NCLT approval date.

• Jaypee Infratech will take the steps for delisting of its equity shares.

• Existing public shareholders will be given an aggregate exit at a price of 14 lakh rupees, which is not less than the liquidation value, after paying off dues in the order of priority.

• No amount will be paid to the promoter shareholders.

Persons Implementing Resolution Plan

In a stock exchange announcement today, Jaypee Infratech’s Company Secretary Surender Kumar Mata shared the details of key persons involved in the implementation of the resolution plan.

He said the key executives who will be involved in the implementation of the resolution plan are Sudhir Valia, Aalok Dave and Suresh Bansal.

• Valia, a chartered accountant, is a co-founder of Sun Pharmaceutical Industries Ltd. He has an experience of more than a decade in managing the real estate development activity and infrastructure business through Suraksha Realty and other associates.

• Dave, a chartered accountant & LLB, has an extensive experience in stressed assets management space. He is the managing director & CEO of Suraksha Asset Reconstruction Ltd. (Suraksha ARC) since its inception in October 2015.

• Bansal currently manages projects being revived by Suraksha ARC. He has experience of 43 years in projects management, construction management, contracts management, and arbitration matters.

Resolution Process Timeline

• The NCLT’s Allahabad bench admitted IDBI Bank’s insolvency petition against Jaypee Infratech on 9 September 2017. Later, the case the case was transferred to Delhi and the matter also reached to the Supreme Court.

• The Supreme Court on 24 March 2021 directed the NCLT to complete Jaypee Infratech’s corporate insolvency resolution process within 45 days.

• The resolution plan of Suraksha Realty received 98.66% votes of the company’s committee of creditors (CoC), while the plan of NBCC (India) Ltd. got 98.55% votes of the CoC. Accordingly, the CoC passed the resolution plan of Suraksha Reality.

(Note: $1 = 81.8994 Indian rupees)

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