Jaypee homebuyers oppose NCLAT order

NEW DELHI: A group of homebuyers has approached the Supreme Court challenging the National Company Law Appellate Tribunal (NCLAT) order allowing NBCC and creditor bank to thrash out resolution plan to take over Jaypee Infratech, even after the plan was rejected by a committee of creditors (CoC) which included homebuyers.
The petition has been filed by a group 1000 homebuyers alleging that the NCLAT order passed on July 2 was in violation of Insolvency and Bankruptcy Code (IBC) as statutory period of 270 days for wrapping up Corporate Insolvency Resolution Process had expired and the tribunal had extended the deadline in violation of law.
“The NCLAT’s impugned order while recording that the resolution plan submitted by NBCC was rejected by the CoC has sought to set aside such rejection and to further reopen such negotiations, usurping the powers/functions, of the NCLT, COC and Resolution Professional, especially when the statutory period for completion of CIRP as stipulated under IBC has expired,” the petition filed by advocate M L Lahoty said.
With creditors rejecting NBCC’s bid to acquire Jaypee Infratech, the NCLAT had directed representatives of banks, allottees and other stakeholders to appear before it on July 17 to sort out differences on the NBCC attempt and consider how the bid could be tweaked for the benefit of homebuyers. During voting, majority of CoC had rejected NBCC’s bid to acquire Jaypee Infratech.
Challenging the order, the petitioners said, “The NCLAT has erroneously usurped the functions/ powers of the resolution professional wherein NCLAT has sought to call the representatives of the financial creditors, the resolution applicant, the resolution professional, the allottees and the fixed deposit holders for conducting such renegotiation for the resolution plan on July 17 especially when the resolution plan has already been rejected once by the majority of the creditors after the expiry of the statutory period.”
The homebuyers also expressed reservations against allowing NBCC to complete the unfinished housing projects of Jaypee and pleaded the apex court to pass order for protection of homebuyers. “The experience of over 48,000 homebuyers of Amrapali with regard to NBCC is extremely frustrating since NBCC refused to invest or arrange any funds for construction of the projects due to which no further construction work is being carried out,” the petition said.
The apex court had on July 11 assured homebuyers that it would intervene to protect the interests of Jaypee homebuyers if the resolution plan under insolvency proceedings failed and asked all parties including NBCC and creditor banks to sort out differences.

Sources: realty.economictimes.indiatimes.com

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