The National Company Law Appellate Tribunal (NCLAT) has said that lenders can vote against state-owned construction firm NBCC’s proposal to acquire debt-ridden Jaypee Infratech and directed for the completion of the ongoing voting process.
The tribunal said it had not restricted lenders from voting against the plan and that voting share of financial creditors who do not vote will not be counted while calculating the total voting share.
Most of Jaypee Infratech’s 23,000 homebuyers, who constitute around 58% of the committee of creditors, have not voted on the NBCC plan so far, with most of those who have voted favouring the plan. Thirteen banks are also members of the committee of creditors of Jaypee Infratech which has total outstanding debts of nearly? 9,800 crore.
The voting was set to be completed on Monday.
“We have not said do not vote against. We have said the CoC may not file final report on the decision, if it is rejected,” said a three-member bench led by Justice SJ Mukhopadhaya.
Lenders had filed a petition before the NCLAT to allow them to vote against the NBCC plan.
A condition in NBCC’s resolution plan that requires lenders to purchase unsold inventory from Jaypee Infratech has been the key reason that lenders have opposed the resolution plan.
The bench also directed that the vote share of members who abstain from voting on the plan not be counted while calculating the total votes and the votes required for approval.
“We make it clear that if any of the financial creditors remain absent in voting, their voting percentage shall not be counted for the purpose of counting voting share,” said the bench.
Lenders had also sought permission from the NCLAT to allow the resolution professional to seek new expressions of interest.
The tribunal also reminded the lenders that they would not be allowed to “take a brick” from the Jaypee Infratech if it were to go into liquidation as Jaypee Infratech’s real estate projects were built on land owned by Yamuna Expressway Industrial Development Authority (YEIDA).
“Jaypee Infratech is not the owner of the land. They have no lease in their favour because they have not paid the total lease money. You can go for liquidation but you cannot take even a brick out of it because the land belongs to YEIDA,” said the bench directed that the matter will now be heard on July 2 by the NCLAT instead of the National Company Law Tribunal, which had been hearing it so far.
Source: Economic Times