Jaiprakash Associates (JAL) on Monday sought permission from the Supreme Court to “hive off” its multi-crore Yamuna Expressway toll asset rights to generate Rs 2,000 crore that it is supposed to deposit to cover part of its subsidiary Jaypee Infratech’s liability towards 32,000 homebuyers.
Jaiprakash Associates (JAL) on Monday sought permission from the Supreme Court to “hive off” its multi-crore Yamuna Expressway toll asset rights to generate Rs 2,000 crore that it is supposed to deposit to cover part of its subsidiary Jaypee Infratech’s liability towards 32,000 homebuyers. While submitting the proposal in a sealed cover, senior counsel Kapil Sibal told a bench led by Chief Justice Dipak Misra that Jaypee Infratech needs approval to “hive off its operation, collection and maintenance rights for a limited period” to raise the funds. He said the group has a “concrete offer” from a prospective buyer who is willing to pay Rs 2,500 crore for the expressway.
Jaypee Infratech has a 37-year licence ending 2050 to operate and maintain the 165-km, six-lane expressway connecting Noida with Agra. According to sources, its annual toll collections on the expressway are around Rs 200 crore. The apex court asked the firm to share the proposal with the attorney general, Anuj Jain, the interim resolution professional (IRP) appointed by the National Company Law Tribunal (NCLT) and the Insolvency and Bankruptcy Board of India. The IRP also submitted an interim resolution plan to the bench.
The matter will be heard next on October 25. Homebuyers, however, opposed the proposal, saying it is JAL which is supposed to deposit Rs 2,000 crore, but the Jaypee group is transferring properties of Jaypee Infratech. The apex court had on September 11 asked JAL, the parent company of Jaypee Infratech, to deposit Rs 2,000 crore with its registry by October 27 to protect the interests of flat buyers. It had also asked the group to take approval of the the IRP before selling any property and restrained the directors and managing directors of Jaypee Infratech and JAL from travelling abroad without the court’s prior permission.
It had also restored the insolvency resolution proceedings against Jaypee Infratech and directed the IRP to take over the “records and management” of the company and submit within 45 days an interim resolution which should safeguard interests of “low- and middle-income homebuyers” who have invested in the real estate major’s 27 housing projects in the national capital region.
Flat buyers had challenged the August 9 order of the Allahabad bench of the NCLT that admitted IDBI Bank’s plea for initiating insolvency proceedings against the debt-ridden Jaypee Infratech for defaulting on a Rs 526-crore loan. While initiating the liquidation proceedings under the Insolvency and Bankruptcy Code of India, 2016, the tribunal had appointed the IRP to carry out the proceedings, as the board of directors of the company would remain suspended.