The Supreme Court today suggested that the realty firm Jaiprakash Associates Limited (JAL) should pay Rs 600 crore, instead of Rs 1,000 crore ordered earlier, to refund the principal amount to the hassled home buyers.
The Supreme Court today suggested that the realty firm Jaiprakash Associates Limited (JAL) should pay Rs 600 crore, instead of Rs 1,000 crore ordered earlier, to refund the principal amount to the hassled home buyers. A bench headed by Chief Justice Dipak Misra asked senior advocate F S Nariman, representing JAL, to take instruction from JAL on depositing Rs 600 crore with the apex court registry.
It said that after the amount is deposited, it would ask the National Company Law Tribunal (NCLT) at Allahabad to expeditiously decide the firm’s plea on revival or restructuring of its subsidiary firm — Jaypee Infratech Limited (JIL). The bench, which also comprised Justices A M Khanwilkar and D Y Chandrachud, had on May 16 directed JAL to deposit 1,000 crore by June 15, in addition to Rs 750 crore already deposited, by June 15 to provide refunds to the home buyers who had wished to opt out of its various housing schemes.
“This case (of home buyers) can be disposed off if they (JAL) deposit Rs 600 crore for refund of the principal amount. We will ask the NCLT to decide the company petition (of JAL),” the bench said. The court also made it clear that it would deal with the issue of refund of money to only those home buyers who do not want possession of their homes. On being informed that Rs 750 crore has already been deposited with the apex court and another Rs 600 crore would be required to pay the principal amount to home buyers, the court asked the realty firm to “establish its bonafide” by paying the money.
Lawyer Pawan Shree Agrawal, who is assisting the court as an amicus curiae, said the home buyers, registered with the portal for seeking refund, have to be paid Rs 1,379 crore and so far Rs 750 crore have been deposited with the apex court registry, leaving a shortfall of almost Rs 650 crore for refunding the principal sum to them. The court, however did not record this aspect in its order and asked Nariman to take instruction from JAL and apprise it on July 13, the next date of hearing, about the company’s stand on depositing Rs 600 crore with it.
At the outset, Nariman said that as many as 17 proposals for reviving JIL have been rejected so far and JAL has entered into agreements with a bank which has agreed to issue a letter of credit to the tune of Rs 1,000 crore subject to certain conditions like mortgaging of properties. “I want a letter of credit from a bank which would say that it will deposit Rs 1,000 crore, provided the NCLT disposes off the petition (of JAL) on revival of JIL,” Nariman said, adding that the NCLT has said it would do almost nothing as the apex court is seized of the matter.
The bench then asked JAL to deposit Rs 600 crore, saying it would ask the NCLT to decide its plea as soon as possible. It fixed the matter for further hearing on July 13. Earlier, the top court had asked JAL to deposit Rs 1,000 crore by June 15 to provide refunds to home buyers and made clear that on submission of the amount, the liquidation proceedings against JIL shall remain stayed. It had also asked the amicus curiae to disburse the money to the home buyers on a “pro-rata” basis.
JAL had said the company has been delivering possession of 500 dwelling units every months to home buyers and moreover, 92 per cent home buyers wanted possession of their homes. Senior advocate Ajit Sinha, appearing for home buyers including one Chitra Sharma, had said the court had directed the real estate firm to deposit Rs 2,000 crore and only Rs 750 crore has been deposited and hence, it was a case of non-compliance of the order.
The home buyers had moved the apex court stating that around 32,000 people had booked flats and were now paying instalments. The plea had also stated that hundreds of home buyers were left in the lurch after the NCLT, on August 10 last year, admitted the IDBI Bank’s plea to initiate insolvency proceedings against the debt-ridden realty firm for allegedly defaulting on a Rs 526-crore loan.