NCLT starts insolvency against Jaiprakash Associates

06 Jun 2024 CW Team

The judgement was issued on Monday afternoon by a two-member bench at NCLT, Allahabad, consisting of Members Praveen Gupta and Ashish Verma, according to attorneys involved in the case. According to them, the tribunal has also ordered the start of a corporate insolvency resolution process (CIRP) against JAL and appointed an interim resolution professional (IRP).

The union of Jaypee Infrastructure Development Ltd. and Jaiprakash Associates Ltd. has also been rejected by the tribunal's Allahabad bench. Leading private sector lender ICICI Bank filed a Section 7 of the IBC bankruptcy suit against JAL in September 2018. In addition, SBI, the largest lender in the nation, filed a complaint with NCLT against JAL, alleging a total default of Rs 68 billion as of September 15, 2022. In August 2017, the Reserve Bank of India listed JAL as one of the 26 major loan defaulters to commercial banks for the purpose of filing for bankruptcy.

Several Jaypee Group enterprises, including Jaypee Cement Corporation, are in the process of being declared insolvent before the NCLT. Its second company, Jaypee Infratech, is also facing insolvency; this week, the Mumbai-based Suraksha group's request was upheld by the NCLAT, an appellate body. The business had failed on repayments of a principle sum of Rs 17 billion and interest of Rs 28 billion on April 30, the JAL had announced last month.

A scheme of arrangement that has been officially agreed upon by all parties involved is awaiting National Company Law Tribunal approval. The corporation stated that the entire debt is currently undergoing reorganisation.

The National Company Law Tribunal (NCLT) accepted the argument put forth by private lender ICICI Bank and ordered the commencement of insolvency proceedings against the indebted Jaiprakash Associates Ltd. The primary activities of the Jaypee Group's flagship company, Jaiprakash Associates Ltd. (JAL), are construction, cement, and hospitality. In order to lower its debt, JAL has sold a large number of cement factories in recent years.The judgement was issued on Monday afternoon by a two-member bench at NCLT, Allahabad, consisting of Members Praveen Gupta and Ashish Verma, according to attorneys involved in the case. According to them, the tribunal has also ordered the start of a corporate insolvency resolution process (CIRP) against JAL and appointed an interim resolution professional (IRP).The union of Jaypee Infrastructure Development Ltd. and Jaiprakash Associates Ltd. has also been rejected by the tribunal's Allahabad bench. Leading private sector lender ICICI Bank filed a Section 7 of the IBC bankruptcy suit against JAL in September 2018. In addition, SBI, the largest lender in the nation, filed a complaint with NCLT against JAL, alleging a total default of Rs 68 billion as of September 15, 2022. In August 2017, the Reserve Bank of India listed JAL as one of the 26 major loan defaulters to commercial banks for the purpose of filing for bankruptcy.Several Jaypee Group enterprises, including Jaypee Cement Corporation, are in the process of being declared insolvent before the NCLT. Its second company, Jaypee Infratech, is also facing insolvency; this week, the Mumbai-based Suraksha group's request was upheld by the NCLAT, an appellate body. The business had failed on repayments of a principle sum of Rs 17 billion and interest of Rs 28 billion on April 30, the JAL had announced last month.A scheme of arrangement that has been officially agreed upon by all parties involved is awaiting National Company Law Tribunal approval. The corporation stated that the entire debt is currently undergoing reorganisation.

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