The Supreme Court criticised the Yamuna Expressway Industrial Development Authority (YEIDA) during a hearing on its appeal against the National Company Law Appellate Tribunal’s (NCLAT) approval of Suraksha Realty’s resolution plan for the debt-ridden Jaypee Infratech Ltd. The three-judge bench, led by Justice Sanjiv Khanna, expressed concern over YEIDA’s lack of attention to the plight of homebuyers, who are seen as the ultimate victims of the ongoing legal dispute.
“You are not concerned with the homebuyers; that’s where the problem lies. The ultimate sufferers are the homebuyers,” remarked Justice Khanna during the hearing. The court emphasised that as a government authority, YEIDA must protect the interests of homebuyers and not just focus on its own dues.
Supreme Court Orders Affidavit from YEIDA
The bench directed YEIDA to file an affidavit outlining the steps it has taken to assist homebuyers, along with any schemes or regulations it has enacted to safeguard their interests. This directive aims to hold YEIDA accountable for its responsibilities towards the homebuyers affected by Jaypee Infratech’s insolvency.
The court agreed to hear the case in full during its October session, ensuring that the interests of the homebuyers, who have been waiting for relief, remain a central focus.
NCLAT’s May Ruling Provided Relief to Homebuyers
In May 2023, the NCLAT had offered significant relief to around 20,000 homebuyers by approving Suraksha Realty’s resolution plan for Jaypee Infratech. YEIDA, which had an agreement with Jaypee since 2007, had filed claims totalling Rs 6,111.6 crore, primarily for pending works, external development charges, and unexecuted external development works. In addition, YEIDA sought Rs 1,689 crore in compensation for land acquired from farmers, affecting about 10,000 farmers.
NCLT and NCLAT Decisions on YEIDA’s Claims
The National Company Law Tribunal (NCLT) approved Suraksha Realty’s resolution plan in March 2023 but allocated only Rs 10 lakh towards YEIDA’s claim for additional compensation. This sparked legal challenges from various parties, including YEIDA, the Income Tax Department, and Jaiprakash Associates Ltd.
While the NCLAT upheld most of the NCLT’s decision, it rejected YEIDA’s claim for additional farmers’ compensation but directed Suraksha Realty to pay Rs 1,334.3 crore to YEIDA, which amounted to 79% of the claimed amount, aligning it with the payments made to other secured creditors.
The Supreme Court’s focus on homebuyers in the Jaypee Infratech insolvency case underscores the need for authorities like YEIDA to prioritise the interests of vulnerable stakeholders. The case will continue in October, with the court closely monitoring YEIDA’s efforts to support the homebuyers affected by this prolonged legal battle.
