NCLT seeks JP Associates reply to notice on ICICI Bank plea

The Allahabad bench of the National Company Law Tribunal on Monday asked Jaiprakash Associates to reply by Tuesday regarding the notice it issued to the company on September 10 on the petition of ICICI Bank initiating insolvency proceedings against the company.

The two-member bench also asked ICICI Bank to file any rejoinder to JP Associates reply by September 20 and has scheduled the matter for hearing on September 26. The company owes around Rs 1,260 crore to ICICI Bank. ICICI Bank had filed an insolvency case in the NCLT after the Reserve Bank of India last month rejected its plea to make an exception in the case of JP Associates as banks had finalised a restructuring plan and also partly implemented it.

JP Associates figured in the second list of insolvency accounts which the RBI had sent to the banks in August 2017 asking them to resolve these cases outside the NCLT till December 2017. Failing this they would have to go for the insolvency proceedings, RBI had said.

In June 2017, the lenders had approved a restructuring plan for JP Associates according to which its land parcels would be carved out into a special purpose vehicle for selling to prospective buyers on a long-term payment basis to reduce the company’s debt.

In June 2017 the company also managed to close the sale of its cement units to UltraTech Cement which brought down its debt by Rs 10,000 crore. By October 2017, JP Associates had approved its de-merger scheme of transferring its movable and immovable assets worth Rs 11,834 crore to Jaypee Infrastructure Development. The scheme was then sent to RBI for approval. However, with the Supreme Court finally changing its stance on insolvency of JP Associates subsidiary Jaypee Infratech made the RBI change its mind.

ICICI Bank