Banks asked not to move NCLT against Jaiprakash
The Reserve Bank of India has ordered banks not to initiate bankruptcy proceedings against Jaiprakash Associates in order to safeguard the interests of home buyers. The company is among 28 firms that banks were directed to refer to bankruptcy court…

The Reserve Bank of India has ordered banks not to initiate bankruptcy proceedings against Jaiprakash Associates in order to safeguard the interests of home buyers.

The company is among 28 firms that banks were directed to refer to bankruptcy court if debt resolution plans were not in place by the end of 2017.

“The regulator has told us to ‘keep on hold’ the move to refer Jaiprakash Associates to the NCLT (National Company Law Tribunal),” Economic Times quoted a senior bank official as saying.

Jaiprakash Associates, with debt of Rs 250 billion, is part of the Jaypee Group promoted by Manoj Gaur and his family.

In November last year the Supreme Court has barred promoters and directors  from transferring any personal assets or property without its permission. This was to ensure that buyers, who had paid for homes built by the company, but had not got possession of them, would be protected.

The ruling followed an appeal by hundreds of home buyers after IDBI Bank filed insolvency proceedings in August against Jaypee Infratech, a subsidiary of Jaiprakash Associates.

In 2007, Jaypee group started the development of 32,000 flats and plots in its township Wish Town at Noida, of which nearly 8,000 units have been delivered so far.

In 2007, Jaypee group started the development of 32,000 flats and plots in its township Wish Town  of which nearly 8,000 units have been delivered so far.

Of the total flats/plots, Jaypee Infratech, which has already gone into insolvency, began work on 28,000 units while the remaining 4,000 units were with Jaypee group’s flagship firm Jaiprakash Associates.

“Subject to orders of Supreme Court and National Company Law Tribunal (NCLT), we intend to complete and deliver all 32,000 units by 2020,” Jaypee advisor Ajit Kumar told PTI.

 

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