UPDATE on Supreme court hearing today 16th July 2018: Fali Nariman Senior lawyer spoke to around 20 minutes and explained the following: 1) will increase the workforce on ground 2) 500 flats will be delivered per month 3)requested SC to give permission to sell his cement plants, which are on the block. The hearing will continue tomorrow at 10:30 am and the homebuyers lawyers will be heard. For your information attaching the submitted document for people to read.
(1).docx
Ltd. (JIL) shall deposit a further sum of
Rs.1,000 crores jointly and severally by
15.6.2008. Subject to the said deposit,
there shall be a stay of further
proceedings only insofar as the
liquidation is concerned. In the
meantime, interim Resolution
Professional (IRP) shall remain in
management. If the amount is not
deposited by 15.6.2018, the statutory
proceedings shall continue.”
IN PLACE OF AND IN SUBSTITUTION OF THE
ABOVE PORTION, IT IS PRAYED THAT THE
FOLLOWING FURTHER ORDER MAY BE
PASSED:
“SINCE JAL HAVE ALREADY
UNDERTAKEN TO DEPOSIT POST-DATED
CHEQUES AS STATED ABOVE WITH THE
REGISTRAR OF SUPREME COURT
AGGREGATING TO RS.600 CRORES AS
STATED ABOVE, THE STAY OF
LIQUIDATION PROCEEDINGS WILL
CONTINUE, AND THERE SHALL ALSO BE
A STAY OF THE DIRECTION THAT ‘THE
INTERIM RESOLUTION PROFESSIONAL
SHALL REMAIN IN MANAGEMENT”2
- With regard to the outstanding dues to
(1+12) bankers of JIL (lead banker IDBI) a
firm and concrete proposal duly signed by
the Directors of JAL and JIL has been
submitted to IDBI for favourable
consideration and acceptance.
2The maximum statutory time limit for resolution process under the Code has expired on
12.5.2018 (section 12)
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C:\Users\UserPC\Downloads\Jaypee Note 16 July 2018 corrected by FSN (1).docx
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
WRIT PETITION (CIVIL) NO.744 OF 2017
IN THE MATTER OF:
CHITRA SHARMA & ORS: ……PETITIONER
VERSUS
UNION OF INDIA & ORS. …..RESPONDENT
AND
SPECIAL LEAVE PETITION No.24001 of 2017
IN THE MATTER OF:
MS. MOHNA: ........ PETITIONER
VERSUS
JAYPEE INFRATECH LTD. & ORS. .....RESPONDENT
2
C:\Users\UserPC\Downloads\Jaypee Note 16 July 2018 corrected by FSN (1).docx
BRIEF NOTE TO BE SUBMITTED TO THE HON’BLE
COURT ON MONDAY 16TH JULY 2018 – THE
NOTE HAS BEEN CIRCULATED OVERNIGHT TO
COUNSEL/ADVOCATES FOR THE PARTIES
APPEARING AND TO THE AMICUS.
(DIRECTIONS SOUGHT AND PRAYED FOR FROM
YOUR LORDSHIPS)
(1) Jaiprakash Associates Ltd. (JAL) is a public
listed Company having 5.57 lakh individual
shareholders and 15 directors (with 8
independent directors and 2 nominee
directors of Banks (Lenders)
(a) Shri Jaiprakash Gaur, his family and
Associates hold 28.8 percent of its share
capital
(b) Banks and public financial institutions
hold 5% of capital.
(c) Rest is held widely by the public (5.57
lakh).
2(A) Jaiprakash Associates Ltd (JAL) in the year
2003 had bid for and were allotted in a global
tender the work of construction of 165 km
long expressway from Noida to Agra at JAL’s
own cost including, cost of acquisition of land
required for the Expressway. Under the
global tender JAL was entitled to realize its
investment:
a)By way of collection of toll for 36 years
from 2012;
b)By way of development of parcels of land
as stipulated in global tender at 5 specified
locations from Noida to Agra.
The cost of acquisition was to be borne and
was borne by JAL and a Concession
Agreement in above terms was entered into
by Yamuna Expressway Industrial
C:\Users\UserPC\Downloads\Jaypee Note 16 July 2018 corrected by FSN (1).docx
Development Authority (earlier known as Taj
Expressway Authority) with JAL.
2(B) In the year 2006, at the instance of
Government of UP which had floated the
global tender awarded to JAL, JAL was
required to set up and incorporate a Special
Purpose Vehicle (SPV): Jaypee Infratech Ltd
(JIL).
2(C) Between 2003 and 2006 before the Special
Purpose Vehicle (SPV) was set up, UP govt.
undertook the process of acquisition of land
for the Project, land for Expressway and land
parcels for development. The Concession
Agreement (pursuant to a direction from a
Committee set up by the UP Government)
was transferred in the year 2006 to the SPV
viz. Jaypee Infratech Ltd (JIL).
2(D)From 2008 onwards loans of Rs.8,125 crores
were given to JIL by IDBI (lead Bank) and 12
other Banks against partial mortgage of
lands acquired in the Noida-Agra sector
(6175 acres) and by pledge of 51%
shareholding held by the promoter company
(Jaiprakash Associates Ltd.).
All the toll money receivables by the
company (viz. JIL) were required to be
deposited and were deposited in an account
called Trust & Retention Account (TRA)
controlled by the IDBI (the Leader of the
lender Group) and disbursal was prioritised
by the lead Bank – retaining amounts for
interest on loans at an average rate of 12.6%
and then only permitting withdrawals for
expenditure towards construction of homes.
3. Housing Plan envisaged construction of
project in June 2009 at two locations of
acquired land totalling 2517 acres: in two
parcels namely 1162 acres in Wish Town
Noida and 1355 acres in Mirzapur as under:
(a) 307 towers (each tower ranging from 90
to 110 Units) in two parcels of land
admeasuring 2517 acres (out of 6175
acres)
(b) Large part of the rest if un-built
land(6175 minus 2517 acres) mortgaged
against loans of(1 + 12) Banks (with
IDBI as lead Bank): loans initially were
of Rs.6550 crores, later (and now) of the
order of Rs.8125 crores (principal)
4. IMPEDIMENTS
First impediment was between 2009 to
2011.Because of the impending 19th
Commonwealth Games the building
contractors who had been engaged by
JAL/JIL for construction, under express
orders of the Government agencies,
transferred a substantial part of the
workforce from the housing projects to work
for the Commonwealth Games.
The second impediment leading to temporary
disruption of work at site was an ex-parte
order issued by National Green Tribunal
dated 11.01.2013 restraining all builders of
Noida and Greater Noida area from
extracting any quantity of underground
water for the purposes of construction or
otherwise: water for construction has had to
be arranged with water tankers.
The third impediment(for 2 years) was
another order issued by National Green
Tribunal dated 14.8.2013 to the effect no
further construction was to be done within
10 kms radius of Okhla Bird Sanctuary
without obtaining proper environment
clearance. (All the planned 307 towers were
in parcels of land which were within 10 km of
Okhla Bird Sanctuary.) It was only on
19thAugust 2015 that a Notification was
issued by Government of India lifting the
environment restriction and maintaining it
only 100 meters radius of Okhla Bird
Sanctuary.
5. Despite the above impediments,307
Towers(each Tower consisting of 20 to 30
floors), envisaged in the project for
construction on land admeasuring 2517
acres, were/are being completed and
constructed as per details below:
(i) 41 Towers (with 5507 flats/Units)
were completed and possession
handed over to 5507 Home Buyers
on or before 9th August 2017i.e.
date of initiation of corporate
insolvency proceedings
(ii) During the pendency of corporate
insolvency proceedings between 9th
August 2017 and 12thMay 2018
(maximum time limit given for
completion of resolution process
under section 12 of the Code which
ended on 12th May 2018) – 30
Towers (with 4874 Units) were
completed and possession handed
over to 4874 home-buyers.
(iii) Between 12th May 2018 to 15th July
2018, 8 more Towers (with
819flats/Units) were completed and
possession handed over to 819
Home-Buyers.
(It is clarified that upto the
initiation of Insolvency proceedings
307 Towers (32,732 Units) were
under various stages of
construction and upto 15th July
2018, 79 Towers (11,200 Units)had
been completed and possession
handed over to 11,200 home-
buyers.)
(iv) The remaining 21,532 home buyers
(for 21,532 flats/Units) have still to
be accommodated in 228 Towers
which are under various stages of
construction;
6. Apart from what is stated above both before
the commencement of insolvency
proceedings and after 12th May 2018
construction activity on the project site has
not been stalled or stopped and is going
ahead and completion achieved is indicated
below month-wise:
Month Units completed
and handed over
to home-buyers.
August 2017 Under
construction
September 2017 257
October 2017 299
November 2017 20
December 2017 88
January 2017 81
February 2018 353
March 2018. 3420
April 2018 178
May 2018 178
June 2018. 819
Total 5693 units in 38
Towers
constructed and
completed and
possession
handed over to
5693 home
buyers
7. Till date:
(i) construction of 106 Towers (out of
remaining 228 towers) - consisting of
11,336 units/flats is 50% to 90%
complete, and
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(ii) construction of 50 Towers consisting of
6,500 Units is between 25% to 50%
complete, and
(iii) construction of 72 Towers is less than
25% complete.
On the basis of the above the expectation
and undertaking is to accommodate
approximately 500 home buyers out of the
remaining 21,532home buyers every single
month starting from July 2018.
And in order to somehow alleviate the long
delay in completing and giving possession of
UNITS to the remaining 21,532 home buyers,
JAL & JIL undertake to engage double the
existing strength of workers (at present
there are approximately 4000 workers
working on the project) for construction of
Towers (Units) with the expectation that the
completion process gets further expedited:
THE YES BANK HAS BEEN APPROACHED AND
IT IS CONFIDENTLY EXPECTED (SHOW
LETTER) THAT FURTHER LOAN OF RS.2,700
CRORES WILL BE FORTHCOMING AGAINST
PERMISSION REQUESTED FROM THIS
HON’BLE COURT TO MONETISE TOLL-
RECEIVABLES (FOR 10 YEARS) IN FAVOUR
OF YES BANK.
8. It is respectfully submitted that all this can
only be done -
First if the home buyers who have already
sought refund of their monies against
allotment of their Units are refunded their
principal sum which is to the tune of Rs.
1372 crores.
- Against this under earlier orders passed by
this Hon’ble Court a sum of Rs. 750 cr in
various instalments have already been
deposited in this Hon’ble Court on which
interest of Rs.25 crores (approximately) has
accrued, and 8
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- It is proposed that:
Post dated cheques of Rs.600 crores
(Rupees Six hundred crores) be deposited
forthwith with the Registrar of this Hon'ble
Court on the assurance of JAL that the
cheques will be honoured on their due
dates viz:
(a) Cheque dated 16thJuly, 2018 in favour of
the Registrar, Supreme Court of India
for a sum of Rs.10 crores (Rupees Ten
crores only);
(b) Cheque dated 23rd July, 2018 in favour
of the Registrar, Supreme Court of India
for a sum of Rs.15 crores (Rupees
Fifteen crores only);
(c) Cheque dated 30th July, 2018 in favour
of the Registrar, Supreme Court of India
for a sum of Rs.25 crores (Rupees
Twenty five crores only);
(d) Cheque dated 6th August, 2018, in favour
of the Registrar, Supreme Court of India
for a sum of Rs.25 crores (Rupees
Twenty five crores only);
(e) Cheque dated 13th August, 2018, in
favour of the Registrar, Supreme Court
of India for a sum of Rs.25 crores
(Rupees Twenty five crores only);
(f) Cheque dated 20th August, 2018 in
favour of the Registrar, Supreme Court
of India for a sum of Rs.25 crores
(Rupees Twenty five crores only);
(g) Cheque dated 27th August, 2018 in
favour of the Registrar, Supreme Court
of India for a sum of Rs.475 crores
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(Rupees four hundred and seventy five
crores only);1
- In order that the actual total deposit of
Rs.600 crores (Rupees Six hundred crores
only) is realised on the due dates, IT IS
PRAYED THAT PRIOR APPROVAL MAY BE
GRANTED BY THIS HON'BLE COURT (IN
TERMS OF THE ORDER ALREADY PASSED ON
11TH SEPTEMBER, 2017) FOR JAL TO DISPOSE
OF IDENTIFIED CEMENT ASSETS INCLUDING
ITS CEMENT PLANT AT REWA, MADHYA
PRADESH;
- TO ENABLE JAL TO DO THIS, THE NATIONAL
COMPANY LAW TRIBUNAL (NCLT),
ALLAHABAD MAY KINDLY BE DIRECTED BY
THIS HON’BLE COURT (PRAYER (C) IN I.A.
83510 OF 2018 IN SLP CIVIL 24001 OF
2017) TO PROCEED FORTHWITH TO DECIDE
AND PASS APPROPRIATE ORDERS IN CP NO.
19/ALD/2018 AND CA NO.
174/ALD/2017,for sanctioning the Scheme
of Arrangement, propounded pursuant to
Master Restructuring Agreement signed and
accepted by all 32 creditors of JAL. The
Scheme of Arrangement is already filed with
the National Company Law Tribunal (NCLT),
Allahabad and the NCLT in its Order dated
25.01.2018 has sought for appropriate
directions from this Hon’ble Court.
- IT IS ALSO PRAYED THAT THE FOLLOWING
PORTION OF ORDER DT. 16.5.2018, IN WRIT
PETITION (C) 744/2017 (AND CONNECTED
PETITIONS) BE CLARIFIED AS BELOW:
- The order dated 16.5.2018 states:
“Having heard learned counsel for the
parties at length, it is directed that the
Jai Prakash Associates Ltd (JAL), the
holding company of Jaypee Infratech
1Order for distribution of principal amounts to all home buyers pro-rata who have opted for
refund has already been passed on 21.03.2018.
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