Jaypee Infra IRP claims NBCC bid still 'conditional'

Last Updated: Thu, May 09, 2019 11:18 hrs
A man walks in front of a billboard of Jaypee Infratech in Mumbai

New Delhi: Even as NBCC secured the required approvals from the ministries and government departments, the Insolvency Resolution Professional (IRP) of Jaypee Infratech (JIL) has said that the NBCC's revised resolution plan remains conditional, which goes against that CoC process note which says that the resolution plan should be binding and non-conditional.

In a letter dated May 2, IRP Anuj Jain said: "Please note that the NBCC revised resolution plan remains conditional as NBCC has stated that the plan will not be binding on it unless key reliefs as mentioned in Schedule 3 are granted."

NBCC received the required approvals by May 1.

Jain said during the April 26 meeting, he had informed the CoC that the NBCC's revised bid is being conditional as the company said its plan will not be binding on it unless 2 key reliefs mentioned in Schedule 3 (reliefs and concessions) are granted.

The state-run construction major sought relief from taking consent of the Yamuna Expressway Industrial Development Authority's (YEIDA) for any business transfer between JIL and Yamuna Expressway SPV for transfer of assets as well as land parcels from JIL to land bank "special purpose vehicle".

The other relief is regarding an income-tax liability.

The Income Tax Department has been making an annual tax addition of around Rs 2,950 crore, as per a concession agreement for the transfer of land from YEIDA to JIL, which amounts to around Rs 33,000 crore for 30 years as tax demand. The NBCC wants this liability to be removed.

The IRP, however, on Friday called for a meeting of the CoC to discuss on NBCC's revised bid on May 9.

The Allahabad bench of the NCLT also on Monday ordered continuation of the corporate insolvency resolution process (CIRP) till its next hearing on May 21 and also ordered the CoC to consider the NBCC bid which makes the company's chances of acquiring the JIL are now stronger.

It will be the only bid to be considered by the CoC now after the lenders rejected Suraksha's bid in its latest e-voting procedure.

Sources said the bid of NBCC (India) Ltd -- formerly known as National Buildings Construction Corporation Ltd -- is worth around Rs 24,000 crore, compared to the liquidation value set by the Committee of Creditors (CoC) at Rs 17,000 crore.