NEW DELHI: National Company Law Appellate Tribunal (NCLAT), on Monday, reserved its order in Jaiprakash Associates Ltd’s (JAL) appeal against NCLT‘s order of admitting it into insolvency.
National Company Law Tribunal (NCLT) Allahabad passed an insolvency admission order earlier this year on ICICI bank‘s plea, holding the construction and infrastructure company to have defaulted on payments amounting to ₹1269 crore.
JAL has argued that its total debt was restructured under the master restructuring agreement (MRA), and the default date mentioned by the lenders goes before the MRA, which is bad in law.
JAL’s counsel said, “Date of default is superseded by restructuring agreement.”
However, lenders led by ICICI Bank have countered JAL’s argument, stating that the debt relating to the present petition was never part of any MRA.
JAL’s counsel has also said that NCLT committed a mistake by not awaiting the outcome of its petition filed before the Allahabad High Court.
JAL has filed a petition before the high court, appealing against Yamuna Expressway Industrial Development Authority’s (YEIDA) order, which cancelled the allocation of land parcels to it.
JAL has informed the appellate tribunal that the land was valued more than its debt amount, and if the land was restored, it could easily repay its total debt. The lenders have relied on Chitra Sharma’s judgment arguing that the apex court had directed the initiation of insolvency proceedings against JAL.
However, JAL has opposed the above argument, stating that the Supreme Court had not approved any initiation of insolvency proceedings against it, especially when a debt resolution agreement was hammered out between JAL and lenders.
