Insolvency: Jaypee should be directed to finish projects, say homebuyers

Homebuyers of Jaypee Infratech Ltd (JIL) want the National Company Law Tribunal (NCLT) or the Supreme Court to find a solution to the company’s financial difficulties other than liquidating its assets.

Chances of liquidation increased after the committee of creditors (CoC) rejected the Rs 73.5-billion bid by the highest bidder, Lakshadweep Pvt Ltd, a joint venture between Suraksha Asset Reconstruction Company and Mumbai-based Dosti Realty.

Meanwhile, Jayprakash Associates Ltd on Wednesday filed a special leave petition before the Supreme Court, asking it to consider its offer to the committee of creditors (CoC) earlier. 

It pleaded that the NCLT, Allahabad, be restrained from proceeding on the matter until the Supreme Court order.

Raising slogans – 'Paisa nahi, ghar chahiye' (we want our homes, no money) – on Thursday, agitated homebuyers said the insolvency process should not be applicable to them and their demands should be met outside it.

Protesting in Jaypee’s Wish Town in Greater Noida (Uttar Pradesh), homebuyers said they did not want to settle for anything less than the possession of their homes and wanted to stop paying EMIs (equated monthly instalments) for the dwellings they had not been given possession of. 

They want the Jaypee group to honour its commitment and complete the project. One buyer said, “We want the company to arrange for funds to complete the project.”

They said Jaypee had the bandwidth to complete the projects. Hence, the company should not face liquidation, said these home buyers. 

They wanted the developer to give them an undertaking on completing the projects, wanted the current builder to be directed and monitored to ensure timely completion. 

The homebuyers had moved the Supreme Court soon after the NCLT admitted JIL's insolvency case. 

The case is coming up for hearing on Friday. 

In its offer to the CoC, the Jaypee group had offered 2,000 shares of JIL for free to each homebuyer as part of its Rs 100 billion proposal to reclaim the real estate firm.

The group promised a marginal haircut to JIL lenders and minority shareholders and possession of homes by 2021.