NCLT ADMITS INSOLVENCY PLEA AGAINST JAYPEE INFRA
MUMBAI: The Allahabad bench of the National Company Law Tribunal (NCLT) on Wednesday admitted insolvency proceedings against Jaypee Infratech Ltd, one of the 12 companies referred to the tribunal following the Reserve Bank of India’s June 13 directive to banks, according to two people aware of the matter.
The NCLT bench accepted the petition moved by IDBI Bank, the leader of the consortium of lenders to the Jaypee Group company, and also approved the appointment of an interim resolution professional.
“Jaypee Infratech has withdrawn all the objections with respect to its admission under the Insolvency and Bankruptcy Code (IBC). This has been done keeping in mind the interest of all its stakeholders,” said Jaypee Infratech’s lawyer RP Agarwal.
Including Jaypee Infratech, various benches of NCLTs have so far admitted insolvency proceedings against 10 of the 12 identified companies. The decision is pending in case of Lanco Infratech Ltd and Era Infra Engineering Ltd.
A chartered accountant has been appointed as the interim insolvency professional. “The final decision regarding the appointment of insolvency professional will be taken after the creditors committee meets up after a month,” he added.
With the admission of Jaypee Infratech into insolvency proceedings, a 180-day moratorium— extendable by 90 days— has started, during which its board is replaced by the resolution professional. The professional discharges the functions of the board until the resolution is completed.
Jaypee Infratech has interests in road and real estate sectors. The company has constructed the 165km Yamuna Expressway, connecting Noida and Agra. As on March 31, the consolidated debt of Jaypee Infratech was over ₹7,922 crore with a negative interest coverage ratio, which means the firm is not earning enough to repay its debt.
Jaypee Group firms such as Jaiprakash Associates Ltd and Jaiprakash Power Ventures Ltd have been under stress with escalating debt because of the issues plaguing the infrastructure space.