Supreme Court stays insolvency proceedings against Jaypee Infratech
September 04, 2017It's a great victory for aggrieved home buyers of Jaypee Infratech as Supreme Court has ordered a stay of insolvency proceedings against the real estate baron.
On August 9, 2017, the NCLT has admitted the petition of IDBI Bank to fast track the resolution process of Jaypee Infratech Rs 526.11 crore debt default under the provisions of Insolvency and Bankruptcy Code, 2016.
On account of being unsecured creditors, home buyers were in a bedlam as they would neither get home nor refund of their hard earned money. As per the provisions of insolvency code, the financial interest of the secured creditors takes precedence over that of unsecured creditors. Homebuyers have been tagged under the category of unsecured creditors.
A Public Interest Litigation(PIL) was filed by a homebuyer, Chitra Sharma. It was claimed in the PIL that homebuyers are left remedy less because of the order of NCLT. The plea has sought a direction to the Centre and others that the Insolvency and Bankruptcy Code & quot shall not curtail the legal statutory and vested rights of the flat owners/buyers as consumers& quot defined under the Consumer Protection Act.The plea was moved to Supreme Court for seeking protection of the interest of 30,000 buyers who have invested their hard earned money in Jaypee projects.
Jaypee Infratech is the subsidiary of Jaiprakash Associates is into road construction and real estate business. It has constructed Yamuna Expressway, connecting Delhi to Agra.