The National Company Law Tribunal has ordered the start of insolvency proceedings against Jaiprakash Associates Ltd (JAL). This comes six years after lenders, led by ICICI Bank, first requested action.
The decision will significantly affect the company's real estate operations in Noida and Greater Noida. JAL, the flagship company of the Jaiprakash Group, has housing projects under the brand Wish Town in Noida. Some units have not been delivered yet, and the company has not provided the exact number. In its most recent annual report, the company stated that it had given possession of over 21,000 residential units by March 2023.
However, the move will not impact buyers of JAL apartments and villas whose properties have been registered.
While the legal case was ongoing, JAL sold large pieces of land in its Noida "township" to companies like Max and Kalpataru, which are constructing high-end residential properties. In addition to real estate, JAL has investments in cement, hotels, power, and EPC. Last year, the company reported a loss of over Rs 1,500 crore.
The company still has a large business constructing EPC projects, such as dams and power projects in various locations like Bhutan, Nepal, Gujarat, and Telangana.
Right now, the Implementation and Monitoring Committee (IMC) is in charge of managing JIL’s daily operations. This committee was established by the National Company Law Tribunal (NCLT) and consists of representatives from Suraksha, JIL, homebuyers, and an IRP.
