In a move that might throw a spanner in NBCC’s grand plans of winning the bid for the beleaguered Jaypee Infratech (JIL) projects, Anuj Jain, the interim resolution professional in a letter to the committee of creditors (CoC), categorically said that the state-run infrastructure firm’s proposal is conditional and based on being granted relief from income-tax (I-T) liabilities.
On May 1, NBCC forwarded to the interim resolution professional a copy of a letter from the Ministry of Housing and Urban Development, granting approval to submit the resolution plan for JIL. NBCC further confirmed to the interim resolution professional by email that all administrative approvals have been received and the clause be treated as withdrawn.
“Please note that the process note dated December 27, 2018, approved by the CoC, provides that the resolution plan should be binding and non-conditional. In the CoC meeting, the interim resolution professional informed that the NBCC-revised resolution plan is conditional, as it has stated that the plan will not be binding unless key relief is granted. During the CoC meeting, the NBCC reiterated these and other conditions in the plan,” Jain said in his email.
The CoC, which is all set to meet on May 9, would seriously consider this email from the interim resolution professional before taking any decision on the issue of awarding the bid to NBCC. Sources said the chances are high that the Jaypee projects might go for a third round of bidding.
According to the revised resolution plan with regard to JIL reviewed by Business Standard, NBCC has demanded for I-T liabilities to be extinguished.
“On account of land parcels from Yamuna Expressway Industrial Development Authority (YEIDA) to JIL in terms of concession agreement, the I-T authority has been making an addition to the income of approximately Rs 2,950 crore on an annual basis — which on the basis of the data available has been estimated by the resolution applicant to be a tax demand of Rs 33,000 crore for a period of 30 years. Treating the transfer of land parcels as the revenue subsidy, this liability in its entirety shall stand extinguished upon the approval of this plan without any liability whatsoever of the corporate debtor or the resolution applicant,” it said in the document.
Also, NBCC wants relief from taking the consent of YEIDA for any business transfer between JIL and Yamuna Expressway special purpose vehicle (SPV).
It will include transfer of assets as well as land parcels from JIL to land bank SPV. NBCC has in its bid said the adjudicating authority’s approval should be final and no further approvals should be required.
“The interim resolution professional’s observations will play an important part in the discussions on May 9. But we will take everything into consideration, as thousands of homebuyers have made it clear that they want NBCC to take over the projects,” said a source close to the development.
NBCC has also offered to settle the total operational debt aggregating to Rs 9,712 crore by paying Rs 20 crore. Operational debt comprises I-T department claims, additional compensation claims of Yamuna Expressway landowners, and claims of other operational creditors.
It has promised to deliver flats to homebuyers in four years. It has also offered 1,400-acre land worth Rs 6,000 crore as well as Yamuna Expressway highway to lenders. NBCC has suggested that banks should raise about Rs 2,000 crore against the expressway and provide half of the amount to the public sector undertaking, which it will utilise as an upfront payment. NBCC will also fund the gap of about Rs 1,500 crore between estimated construction cost and receivables from customers.