Jaypee Case hearing Entire Details along with the Great News for Home buyers ...

SC said home buyers will get flats even in case of liquidation..

SC now evaluating two options as per law:

1. Whether revised bidding to be invited from suraksha, kube and adnani. Also whether JAL will allowed for bidding or not..

2. Who will approve plan i.e. SC monitored committee or IBC (homebuyers and financial creditors)

AG, judges supported us and said lets create resolution but Justice Chandrachud said we will not make resolution

3. Kotak said they will jnfuse 3300cr if court give them company and suraksha said allow rebidding and they will revise thier bids..

Brief by Trilegal team

Dear All,

In today’s hearing before the Supreme Court, three counsels got a chance to tender their written representations and make oral submissions.

The first submission was made by Mr. Tushar Mehta—Additional Solicitor General of India, continued on behalf of the Insolvency and Bankruptcy Board of India (IBBI). He pointed out the importance of Section 29A and said that allowing JAL to regain control of JIL will set a bad precedent as other debarred promoters may also approach the Supreme Court for such concession. He suggested that the insolvency process can be extended and the committee of creditors (COC) can be reconstituted to consider fresh proposals/resolutions plans for JIL.

Counsel for the IRP—Mr. Parag Tripathi suggested that there are two options in the current scenario:

(i)              Reconstitution of the COC with representation of the homebuyers; and

(ii)  A committee set up by the Supreme Court to evaluate the resolution plans.

In the second option, JAL may also be allowed to present a resolution plan. Further, he also suggested that HB are unsecured FC.

In our view, constitution of a committee by the Supreme Court for considering resolution plans would be sub-optimal, for two reasons:

(i)    JAL will continue to be in contention; and

(ii)  Homebuyers would have no control over members of the committee (unlike the COC process where IRP for homebuyers is specifically required to comply with the instructions of each and every homebuyer).

Mr. Gopal Jain, appearing for Cube highways said that they are willing to put INR 3300 crores in an escrow account immediately if their resolution plan is accepted.

Similar, Mr. Jayant Bhushan, appearing for Suraksha said that their plan was rejected because homebuyers did not have any voting rights in the COC. He argued that COC should be reconstituted with representation for the homebuyers and their plan, bidding process should be considered afresh by the newly constituted COC.

The hearing will continue tomorrow at 2 pm, wherein other homebuyers, RBI and IDBI would make their submissions.

It may be fruitful to convince other homebuyers’ groups and members of associations that the second option presented by the IRP (i.e. committee set up by the Supreme Court to evaluate the resolution plans) is not the most desirable way forward, due to reasons reiterated below:

(i)  JAL will continue to be in contention; and

(ii) Homebuyers would have no control over members of the committee (unlike the COC process where IRP for homebuyers is specifically required to comply with the instructions of each and every homebuyer).