While allowing a bunch of petitions in the Jaypee Infratech matter, the Supreme Court ordered a fresh round of bidding for the company but barred the parent Jaiprakash Associates or its promoters from participating in it.
The recently amended bankruptcy code classifies home buyers as financial creditors, and get to decide on a company’s future along with lenders. In the light of this, the Court also ordered the reconstitution of the company’s Committee of Creditors.
A division bench including Chief Justice Deepak Misra said that the insolvency proceedings against Jaypee Infratech will be dealt with by the Allahabad bench of the National Company Law Tribunal (NCLT).
The three-judge bench comprising Chief Justice Dipak Misra and Justices AM Khanwilkar and DY Chandrachud, said that the insolvency resolution process for Jaypee Infratech will be deemed to have started afresh from today for a period of 180 days.
The National Company Law Tribunal may extend this period by up to 90 days if necessary, the bench said. The insolvency resolution professional has been ordered to invite fresh bids but both Jaiprakash Associates and Jaypee Infratech have been barred from participating.
The Court also allowed the Reserve Bank of India to direct banks to take JAL to bankruptcy courts.
“JIL/JAL (Jaypee Infratech/Jaiprakash Associates) and their promoters shall be ineligible to participate in the CIRP by virtue of the provisions of Section 29A. RBI is allowed, in terms of applications to this Court to direct the banks to initiate corporate insolvency resolution proceedings against JAL under IBC,” the Supreme Court said.
“The amount of Rs 750 crore which has been deposited in this court by JAL/JIL shall together with the interest accrued thereon be transferred to the NCLT and continue to remain invested and shall abide by such directions as may be issued by the NCLT,” the order said.
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