New Delhi: A bankruptcy court on Tuesday approved a resolution plan submitted by state-run NBCC (India) Ltd to acquire Jaypee Infratech Ltd, offering relief to thousands of homebuyers in the property developer’s stalled projects in Noida and Greater Noida.
The principal bench of the National Company Law Tribunal (NCLT) cleared the NBCC proposal to take charge of incomplete projects of Jaypee Infratech and complete around 20,000 flats over the next three and half years.
NCLT directed that the ₹750 crore deposited by Jaypee Infratech parent Jaiprakash Associates Ltd with the Supreme Court’s registry will be part of the resolution plan as well.
The bench said, “ ₹750 crore would be treated as part of the plan," news agency PTI reported. The bench added that certain modifications were made to the resolution plan approved by it. Finer details of the modifications made by the court would be known on Wednesday, once the written order is available.
The resolution of Jaypee Infratech is likely to provide relief to distressed homebuyers and aid the Indian real estate sector, battling a severe demand slowdown. The Supreme Court on 6 November ordered that the resolution of Jaypee Infratech be completed within 90 days.
Experts said resolution of large companies in distress under the Insolvency and Bankruptcy Code (IBC) offered hope to investors. “Clarity has emerged in the IBC process due to various amendments to the code as well as judicial pronouncements, and there is much more confidence in the bankruptcy resolution process now," said Sumant Batra, managing partner of law firm Kesar Dass B and Associates. “While the resolution of Jaypee Infratech is another encouraging sign, it being a government agency coming forward, it is too early to say sentiments are going to improve dramatically for the real estate sector as a whole due to Jaypee."
