The Supreme Court on Wednesday restrained all 13 directors — including five promoter directors — of Jaiprakash Associates (JAL) and their “immediate and dependent family members” from transferring any personal assets or property without the court’s permission. Any violation of the apex court’s orders would see them being held liable for criminal prosecution and contempt of the court. “Your wealth has gone up at the cost of home buyers… You had a pleasant journey riding the top… but you will have to now come down in the interest of the home buyers… You can’t destroy the life savings of home buyers… Mortgage, sell everything including jewellery to pay the home buyers. We will also attach your personal properties,” a bench led by Chief Justice Dipak Misra told Manoj Gaur and 12 directors who were personally present in the court. The bench, however, allowed JAL to pay dues of Rs 2,000 crore in easier instalments. The amount is being paid by JAL on behalf of its subsidiary Jaypee Infratech, which has a liability towards 32,000 home buyers. Earlier on November 6, the apex court had rejected JAL’s offer to deposit `400 crore towards the dues of Rs 2,000 crore and had asked it to deposit a “substantial amount such as Rs 1,000 crore” to prove its bona fides.
Home buyers raised a demand for a forensic audit of both JAL and Jaypee Infratech. Attorney general KK Venugopal told the bench he had learned from newspaper reports about the diversion of Rs 10,000 crore and called for a forensic audit of the two companies. Senior advocates Mukul Rohatgi, Kapil Sibal and Ranjit Kumar, appearing for the directors and promoters, said they had no problem with the forensic audit. However, they asked for more time till June to deposit the money as JAL was under a debt restructuring process. The firm handed over a demand draft for Rs 275 crore on Wednesday and must deposit Rs 150 crore by December 14 and another Rs 125 crore by December 31. While maintaining that it had nothing personal against the promoters and directors, the CJI advised Gaurs to “pay up like good boys (achhe bachon ki tarah paise jama kar dein)”.
The bench further said the circumstances warranted that not only the top officials but also their family members, including wife and children, should be restrained from transferring rights in the assets. “Any violation of this order would make them liable for contempt and criminal prosecution,” it warned. The court also directed amicus curiae and advocate Pawan Shree Agrawal to set up within a week a web portal that would contain all details including grievances of the hassled home buyers.
Das, appearing for the company, to furnish all the information as sought by the amicus. Similar websites have been set up under the court’s orders in cases of default by real estate companies like Unitech and Supertech. Coming down heavily on real estate major JAL for failing to deposit Rs 2,000 crore, the Supreme Court had on November 13 asked its directors to be personally present before it and disclose their personal assets. It had also rejected JAL’s proposal to hive off its multi-crore Yamuna Expressway toll asset rights to generate Rs 2,000 crore.
Flat buyers had challenged the August 9 order of the Allahabad bench of the National Company Law Tribunal 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, 2016, the tribunal had appointed the interim resolution professional to carry out the proceedings, as the board of directors of the company would remain suspended.