NCLT Names Resolution Professional For Jaypee Infratech

The National Company Law Tribunal has admitted the plea of public sector lender IDBI Bank relating to the Rs 526 crore loan default by Jaypee Infratech and appointed an interim resolution professional for it.

The Allahabad bench of NCLT has appointed Anuj Jain as the interim resolution professional (IRP) to carry out the proceedings under the Insolvency and Bankruptcy Code.

"The interim resolution professional shall perform all his functions strictly which are contemplated, inter alia, by section 17, 18, 20 and 21 of the code," said Judicial Member H P Chaturvedi in the order.

The NCLT directed that "all the personnel connected with the corporate debtor (Jaypee Infratech), its promoter or any other person associated with the corporate debtor are under legal obligation to extend every assistance and cooperation to the IRP".

The IRP "shall be under duty to protect and preserve the value of the property of the corporate debtor as part of its obligation imposed" on it, NCLT said.

As per the order, Jaypee Infratech, which is part of the debt-ridden Jaypee group, has defaulted on Rs 526.11 crore loan outstanding to IDBI.

Jaypee Infratech is into road construction and real estate business. It has constructed the Yamuna Expressway, connecting Delhi-Agra.

The NCLT bench has pronounced the operative portion only, saying "the order in detail is recorded separately".

Earlier, the Jaypee group firm had filed objection against the admission of IDBI's petition. However, on August 4, it withdrew the same expressing its desire for an early approval of the resolution plan for the debtor.

In the memo filed before the tribunal, Jaypee Infratech said that it has no objection considering the "interest of all the stakeholders of the residents company, including home buyers and depositors".

"It is now an undisputed position in the matter that the financial creditor along with other lenders as well as the corporate debtor company are having consensus for early approval of the resolution," said the NCLT.

The Jaypee group is selling its assets to reduce debt. UltraTech Cement in June closed the acquisition of cement plants of Jaiprakash Associates for Rs 16,189 crore.

Bankruptcy proceedings have also been initiated against other companies, including Bhushan Steel, Bhushan Steel and Power, Electrosteel Steels and Lanco Infratech, Alok Industries and Jyoti Structures, which are among the 12 non performing asset (NPA) or bad loan cases identified by the Reserve Bank of India.

The 12 accounts alone constitute a quarter of the over Rs 8 lakh crore of NPAs. Of the total, Rs 6 lakh crore are with public banks alone.

The internal advisory committee (IAC) of the RBI, after its meeting on June 13, had recommended 12 accounts representing about 25 percent of gross NPAs of the banking system for immediate reference under the IBC.

These accounts have an exposure of more than Rs 5,000 crore each, with 60 percent or more classified as bad loans by banks as of March 2016.