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NCLT’s Mumbai bench approves Jyoti Structure’s amended resolution

NTT Communications- Netmagic

The Mumbai bench of National Company Law Tribunal (NCLT) on Tuesday gave nod to the amended resolution plan for Jyoti Structures by Netmagic. Netmagic as per the amended resolution plan is offering to pay ₹3,965 crore to the lenders in the next 12 years.

In the previous year resolution plan the time period for paying to lenders was 15 years which is now slashed by 3 years.

The new decision comes just one day after the Mumbai bench of NCLT adjourned the case for a final review on 26 of April.

Jyoti Structures, which owes ₹7,010.55 crore and unpaid interest to the lenders, is among the first 12 large accounts referred to NCLTs by the Reserve Bank in June 2017

In the new resolution plan the sole offer was given by Sanghi, who is the managing director and chief executive of data centre company Netmagic, he said to the tribunal that he will pay ₹3,965 crore to the lenders in the next 12 years.
Also, as per the amended resolution plan, he will pay ₹147 crore to the employees and ₹11 crore as statutory dues too, which has to be paid immediately. While in a period of seven years ₹115 crore has to paid to its operational creditors.
However, DBS Bank has decided to file an appeal and is opposing the amended resolution bid.
Last week NCLAT ordered to Sanghi to revise its resolution bid, which it did and also got approved by NCLT. The bench has also set aside Mumbai bench’s previous order dated 31 July, 2018 and ordered the liquidation of the Jyoti Structures and also ordered the Mumbai bench to reconsider the bid.
Mumbai based bench earlier ordered liquidation of the company rejection is resolution bid on 31 July, citing delays beyond the mandated 270 days under IBC and the absence of required majority of 75% at the March 26 & 27, 2018 voting when only 62.66% of the lenders had accepted the bid.

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