The Hon'ble Supreme Court looked into two major issues under the IBC regime: (i) whether the NCLT and the NCLAT had the power to exclude any period from the statutory period in exercise of their inherent powers, without any express provision in the IBC and; (ii) whether a bidder whose resolution plan had already been rejected by the committee of creditors could submit a revised plan to the committee of creditors after the statutory period specified for submission of such plans.
IDBI Bank had filed an application under Section 7 of the IBC against Jaypee Industries Ltd. While the NCLT proceedings were pending, the homebuyers of a project of Jaypee Industries approached the Supreme Court whereby an order was passed granting the period of 180 days for the conclusion of the CIRP. The homebuyers also sought a clarification before the NCLT regarding the manner in which the percentage of homebuyers was to be reckoned, and this order was challenged before NCLAT. At the same time, IDBI Bank had also appealed its clarificatory application to the NCLAT.
Jaiprakash Associates, the holder company of Jaypee Industries Ltd., filed an appeal against the decision of the NCLAT, challenging their authority to exclude 90 days from the statutory period of the CIRP and starting a fresh process by allowing other resolution applicants to submit a revised resolution plan.
The Hon'ble Supreme Court exercising its power under Article 142 of the Constitution of India and in the interests of the home buyers gave 90 more days to the resolution professional to complete the CIRP. The Supreme Court specifically clarified that these directions were exceptional in nature and cannot be used as a precedent within the scope of IBC.
* Civil Appeal No. 6486 of 2019.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.