Synopsis: A bench headed by Chief Justice Dipak Misra also ordered Pawan Shree Agrawal to set up a portal to take care of the concerns of JAL’s home buyers.
The Supreme Court, recently, ordered realtor Jaiprakash Associate Limited (JAL) to provide details of its ongoing country-wide housing projects, while reiterating its direction not to alienate its directors from their personal property.
Amicus curie Pawan Shree Agrawal was also directed by a bench headed by Chief Justice Dipak Misra to create a portal to take care of the grievances of JAL home buyers.
The bench, which also includes Justices A M Khanwilkar and D Y Chandrachud, reported that it would decide at a later stage to invite the Reserve Bank of India (RBI) to file insolvency proceedings with the National Company Law Tribunal (NCLT) against the JAL promoter.
The bench also found that senior lawyer Ranjit Kumar, representing independent directors of JAL, had submitted that, on account of their age, they were exempted from personal appearance before the bench on each date of the hearing.
However, the bench, which exempted independent directors from personal appearance, reiterated its earlier direction by not leaving the country without its prior approval nor alienating or creating third party interests in its personal property.
The interest of homebuyers was important, noted the bench and in pursuance of its previous order, the JAL will have to deposit the money.
Senior Advocate Mukul Rohatgi and Advocate Anupam Lal Das, appearing for JAL said that they had sold several properties and were in the midst of restructuring the loan.
They said that by January 25, as directed by the Apex court on December 15 last year, JAL will deposit Rs. 125 crore more to safeguard the interests of its homebuyers.
So far, JAL has deposited Rs. 425 crore with the Apex court registry.
The top court had previously barred 13 directors from alienating their personal property as well as that of their immediate family members, five promoters and eight independent directors.
The guidance of the Apex court that the directors shall not in any way alienate the personal properties of their or their family members implies the freezing of their assets. The court also restrained the managing director and the directors of Jaypee Infratech Ltd from travelling abroad without prior permission on 13 November last year.
Jaypee Infratech was ordered by the court to hand over the records to the Interim Resolution Professional (IRP) to prepare a resolution plan to protect the interests of more than 32,000 distressed home buyers and creditors.
Homebuyers, including one Chitra Sharma, had moved the Apex court through lawyer Ashwarya Sinha, saying that about 32,000 persons had booked their flats and were now paying installments.
On September 4, 2017, the top court had stayed the insolvency proceedings before the NCLT against the real estate firm.
Under the Insolvency and Bankruptcy Code, 2016, flat buyers do not fall into the category of secured creditors and can thus only get their money back if anything is left after the secured and operational creditors have been repaid, Sharma, said in her appeal.
On August 10, 2017, hundreds of home buyers were left in the lurch after the NCLT accepted the petition of IDBI Bank to initiate insolvency proceedings against the debt-ridden real estate company for defaulting on a Rs. 526 crore loan.