# In the matter of Jaypee Infratech Ltd.

> NCLT judgment dated 2018-05-16. Citation: TCN-2018-NCLT-01397. The case involves an application filed by the Resolution Professional of Jaypee Infratech Ltd.…

- **Court:** NCLT
- **Order date:** 16 May 2018
- **Citation:** TCN-2018-NCLT-01397
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/jaypee-infratech-ltd-c4c67ece

## Summary

### Background

The case involves an application filed by the Resolution Professional of Jaypee Infratech Ltd. (JIL) under sections 43, 45, 60(5)(a), and 66 of the Insolvency and Bankruptcy Code, 2016, seeking directions regarding certain transactions. The Resolution Professional contends that the transactions, specifically the creation of mortgages of 858 acres of JIL's immovable property to secure the debt of its related party, Jaiprakash Associates Ltd. (JAL), are fraudulent and preferential. The application seeks to declare these transactions as preferential under section 43 of the Code and to direct the Directors and promoters of JIL to contribute to the assets of the Corporate Debtor. The petitioner argues that these transactions were carried out when JIL was facing financial

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## Facts

Jaypee Infratech Limited (JIL), a special-purpose company promoted by Jaiprakash Associates Ltd. (JAL), was involved in the design, engineering, and construction of the Yamuna Expressway. JIL was granted rights to develop 25 million square meters of land along the expressway. JIL launched various projects in Noida, Mirzapur, and Agra, selling 32,962 units and collecting ₹13,569 crores from flat buyers by August 13, 2017. Project completion in Noida was scheduled for 2013-2014, but completion ranged from 17% to 80%. JIL faced financial stress, failing to meet project completion deadlines and deliver flats to homebuyers. As of August 9, 2017, JIL had an outstanding liability of ₹132 crores to 7451 Retail Fixed Deposit Holders. JIL's account was declared a Non-Performing

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## Issues and analysis

### Issue 1: Whether the Interim Resolution Professional …

**Ratio:** Section 25 of the Insolvency and Bankruptcy Code, 2016, casts a duty upon the Resolution

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**Reasoning:** The Hon'ble Supreme Court in writ petition No. 744 of 2017, vide order dated 4th

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**Interpretation:** The Resolution Professional has a duty to file an application for avoidance of

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**Application:** The applicant has been conducting the corporate insolvency resolution process

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## Parties

- **Judges:** V. P. S…; Saroj Ra…
- **Appellants:** IDBI Bank L…
- **Respondents:** Jaypee Infratech…; Manoj…

## Timeline

- **2015-09-30 — NPA Declaratio…**: Life Insurance Corporation declared JIL's…
- **2016-03-31 — NPA Declaration by…**: Other lenders declared JIL's account…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 66 — Fraudulent trading or wrongful trading](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-66)

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