On a petition by home buyers, the Supreme Court on Monday stayed the order passed by National Company Law Tribunal (NCLT) which had declared Jaypee Infratech as insolvent. The court also issued notice the realty giant, the Finance Ministry, the Reserve Bank of India and the Uttar Pradesh Government. In addition, a notice has also been sent to the Ministry of Corporate Affairs and IDBI Bank.
On August 10, IDBI Bank had approached NCLT to initiate insolvency proceedings against the realty giant, which is heavily debt-ridden, for defaulting on a Rs 526-crore loan, leaving thousands of home buyers in the lurch.
The company had reported a net loss of Rs 876 crore on Rs 962 crore in revenues in 2016-17 and its gross debt stood at Rs 7,922 crore. Jaypee Infratech is part of 12 large defaulters identified by the Reserve Bank of India. The RBI had asked banks to refer troubled companies to NCLT which had a combined debt of close to Rs 2.4 lakh crore, which they failed to pay after several attempts at loan recovery.
“Around 32,000 buyers have booked their homes in 27 different housing projects of Jaypee Infratech had been left stranded due to the pendency of the insolvency proceedings against Jaypee,” senior advocate Ajit Sinha, representing 24 flat-buyers, had earlier said. He added, “The decrees and orders passed by the consumer courts and civil courts which are in favour of home buyers could not have been executed because of the ongoing insolvency proceeding.”
Jaypee Infratech is into road construction and real estate business. It has constructed the Yamuna Expressway, connecting Delhi-Agra.