Deposit "Substantial Amount" To Prove Bonafide : SC To Jaypee

Real estate giants Jaypee Associates suffered a setback today when the Supreme Court refused to allow it to deposit to Rs 400 crore with its registry as against Rs 2,000 crore directed by it earlier.

The company argued :"no company possessed such a huge amount of liquid fund" but the bench headed by Chief Justice Dipak Misra asked it to submit a "substantial amount" to establish its bonafide saying "Rs 400 crore was a paltry sum".

The company had been asked to deposit Rs 2,000 crore by September 11.

"Arrange whatever money you can arrange, but it must be a bonafide exercise", the bench said when the counsel for the firm said the share holders' consent would be needed to sell the assets of the group.

The bench then said that the firm may consider depositing at least Rs 1,000 crore by November 13 with its registry.

SC had on September 11 directed the Jaypee Associates to deposit Rs 2000 crore by October 27 and asked the NCLT-appointed interim resolution professional (IRP) to take over its management and work out a plan to protect the interests of homebuyers and creditors.

It had also restrained the managing director and directors of Jaypee Infratech Ltd from travelling abroad without its permission and asked the parent company, Jaypee Associates, to deposit the money.

The top court had asked Jaypee Infratech to hand over the records to the IRP for drafting of a resolution plan indicating protection of interests of over 32,000 hassled home buyers and creditors.

It had also stayed any other proceedings instituted against Jaypee Infratech for any purpose in any forum like the consumer commission, as IRP has been given control of the company's management.

The court had allowed Jaypee Associates to raise Rs 2000 crore by selling land or properties and deposit them in the apex court registry by October 27.