Over 20,000 homebuyers of Jaypee have written to the Uttar Pradesh Chief Minister requesting to approve the proposal of out of court settlement between Yamuna Expressway Industrial Development Authority (Yeida)
and Suraksha for farmers compensation.
In March this year, a bankruptcy court had approved Suraksha Asset Reconstruction Co’s (ARC) takeover of the debt-laden property and infrastructure company Jaypee Infratech, dismissing three different appeals against the Rs 7,936- crore resolution bid and rekindling hopes of about 20,000 homebuyers waiting for possession of their promised apartments for nearly a decade.
The matter is presently pending in NCLAT where all the appeals have been heard and the matter is reserved for Judgment.
According to a homebuyer, 20,000 families of Jaypee Wishtown, Noida have been struggling for the last more than 10 years to get their dream house.
While all other issues have been resolved, the biggest hurdle is that of farmers’ compensation by YIEDA.
In this connection, the successful resolution applicant, Suraksha had a series of meetings with YIEDA for almost 3 months to arrive at a out of court settlement and submitted the offer for settlement to NCLAT on July 20 this year.
This proposal was approved in the board meeting of YIEDA and sent by YIEDA to UP Government for cabinet approval on September 13, 2023.
“More than 2 months have passed but UP government has still not approved this proposal. YIEDA has been seeking extension of date in NCLAT for more than 6 months now. If this proposal is approved by the cabinet, it will be to the mutual benefit of YIEDA, Suraksha and JPWT homebuyers at large,” the homebuyer has said in the letter to CM.
Each home buyer has incurred expenses twice to the amount paid to Jaypee Group towards their home by way of interest and rent in these 10 years. There are approximately 100 towers where Jaypee has not laid even one brick since 2014.
The delivered flats are also below the standard quality and amenities promised by them at time of booking has not been provided.
“We have many home buyers who have lost their life’s waiting for the delivery of the flat, some have put in their life savings by paying 80 to 90% of the flat value, while others are under deep financial stress. We would like Suraksha to restart the stalled construction and hand over the flats in the promised quality with the amenities agreed to us at the time of booking,” said homebuyer.
The next date given for acceptance of Suraksha’s proposal is January 12, 2024.
The bulk of the projects are along the arterial expressway linking Greater Noida with either Noida or Jewar – the site of the second airport servicing the Indian capital.
Suraksha ARC had offered 2,500 acres of land and nearly Rs 1,300 crore by way of issuing NCDs as part of its winning bid in 2021.
Jaypee Infratech, a real estate and infrastructure company, was among the initial 12 entities the central bank had referred to the NCLT in August 2017 under the Insolvency and Bankruptcy Code (IBC).
Lead lender IDBI Bank‘s petition was admitted more than five years ago and since then, the resolution has seen four rounds of bidding and various litigations frustrating both lenders and home buyers. The projects include multiple residential towers in Noida and Mirzapur.
In June 2021, the CoC, through a court monitored process, finally approved Suraksha ARC’s bid to take over the distressed borrower.
Jaypee Infratech owes IDBI Bank, ICICI Bank, IFCI and State Bank of India (SBI) and homebuyers a total of Rs 22,600 crore. Homebuyers have advanced Rs 12,714 crore, or 55% of the debt, while lenders have 43%, or Rs 9,234 crore of the debt.
In January, banks led by IDBI sold their debt to the NARCL, marking the first acquisition for the government-backed bad-loan aggregator. The NARCL had offered Rs 3,570 crore – the biggest to date by the government-backed bad bank.
Suraksha’s revised resolution plan increased the aggregate offer to institutional financial creditors by Rs 1,298 crore, expanding the total offer to Rs 7,736 crore. The other contender was NBCC.
