Yamuna Expressway Industrial Development Authority Vs. Monitoring Committee of Jaypee Infratech Ltd. Through Anuj Jain, Secretary & Ors. - To put finality to the process and by accepting the claim of Appellant as secured Operational Creditor towards amount of Rs.1689 crores and directing payment of amount equivalent, which has been given to the secured Financial Creditor,

NCLAT (2024.05.24) in  Yamuna Expressway Industrial Development Authority  Vs. Monitoring Committee of Jaypee Infratech Ltd. Through Anuj Jain, Secretary & Ors. [Company Appeal (AT) (Insolvency) No.493 of 2023] held that;

• Appellant being secured operational creditor, it is entitled for a different treatment in the resolution plan which is meted out to the other secured creditors.

• We have already held Appellant as secured Operational Creditor with respect to additional farmers’ compensation of Rs.1689 crores. The Financial Creditors under Resolution Plan have been proposed the payment of 79% of their secured dues. The Appellant, who is also a secured Operational Creditor to the extent of Rs.1689 crores, is also entitled for payment of same percentage of amount, which has been offered to the Financial Creditors.

• To put finality to the process and by accepting the claim of Appellant as secured Operational Creditor towards amount of Rs.1689 crores and directing payment of amount equivalent, which has been given to the secured Financial Creditor,

Excerpts of the order;

# 47. Counsel for the Appellant relied on Section 13 and Section 13-A to support his submission that Appellant is secured operational creditor of the corporate debtor since any amount payable to the authority under section 13 constitute a charge over property. Section 13 refers to any consideration of money instalment thereof. Any amount due on account of transfer of any site and building of the authority. Admittedly, by the Concession Agreement dated 07.02.2003 land as comprised in the lease deed was transferred on lease as per the Concession Agreement in favour of the concessionaire. Thus, the amount payable consequent to the transfer is fully covered by Section 13. We may also notice certain clauses of the Concession Agreement dated 07.02.2003 as per which concessionaire is liable to pay all acquisition cost for acquisition of land. In Chapter IV of the Concession Agreement, Clause 4.1 provides:-

• “CHAPTER-TV

• LAND

• 4.1. Land for construction of Expressway shall be provided by TEA to the Concessionaire, generally in a width of 100 meters along the alignment of the Expressway with additional land width, where required, for developing other facilities like Toll Plazas etc., on following terms & conditions.”

. .

# 56. The above judgment was not a case where question of security interest by an operational creditor came for consideration. Present is a case where the appellant is claiming secured creditor of the corporate debtor in reference to additional farmers’ compensation. We, thus, are of the view that the judgment of the “New Okhla Industrial Development Authority Versus Anand Sonbhadra” (supra) is not applicable in the facts of the present case. Adjudicating Authority failed to notice the provision of Section 13 and 13-A and considered of the claim of the appellant was only as operational creditor. Appellant being secured operational creditor, it is entitled for a different treatment in the resolution plan which is meted out to the other secured creditors. We have already noticed above that after the order of the Hon’ble Supreme Court, this Appellate Tribunal in this appeal drew attention of both the parties to judgment of “Greater Noida Industrial Development Authority vs. Prabhjit Singh Soni” (supra), the SRA has come up with without prejudice offer of Rs.1216 Crores payment towards additional farmers’ compensation which offer is clearly in recognition of the fact that Appellant is a secured creditor.

 

# 114. We have already held Appellant as secured Operational Creditor with respect to additional farmers’ compensation of Rs.1689 crores. The Financial Creditors under Resolution Plan have been proposed the payment of 79% of their secured dues. The Appellant, who is also a secured Operational Creditor to the extent of Rs.1689 crores, is also entitled for payment of same percentage of amount, which has been offered to the Financial Creditors. We, thus, are of the view that towards additional farmers’ compensation, the Appellant is entitled for 79% of its claim, i.e., 79% of Rs.1689 crores, which comes to Rs.1334.31 crores. The SRA has already offered to make payment of Rs.1216 crores. Thus, the SRA has to bear additional amount of Rs.118.31 crores. The entitlement of Appellant being secured creditor is thus, clearly to amount of Rs.1334.31 crores. The SRA has already given an offer to bear Rs.1216 crores, ends of justice will be served in issuing direction to SRA to make payment of Rs.118.31 crores in addition to Rs.1216 crores already offered by it.

# 115. Now, we come to the timeline, which has been proposed by the SRA for payment. As per Regulation 38, the Operational Creditors are entitled for payment of their dues in priority over Financial Creditor. The payment of priority to the Operational Creditor is not upfront payment of their claims. The timeline proposed for payment of Rs.1216 crores in the offer of SRA is payment in priority over Financial Creditor, since, Financial Creditors are not being paid the amount in priority to the Operational Creditor. The submission of the Appellant that entire payment should be paid at once by the SRA, cannot be accepted. We have already noticed that stakeholders are awaiting for their claims to be considered, including those Homebuyers and there has been prolonged litigations on different issues and the Resolution Plan could be approved only by impugned order dated 07.03.2023. To put finality to the process and by accepting the claim of Appellant as secured Operational Creditor towards amount of Rs.1689 crores and directing payment of amount equivalent, which has been given to the secured Financial Creditor, ends of justice will be served in paving a way forward for implementation of the Resolution Plan. We could have asked the SRA to move for an addendum to be submitted before the CoC, by including the aforesaid provisions, but it will delay the process. Hence, we have adopted second course, i.e., by issuing direction to the SRA to make payment of 79% of secured claim of the Appellant of Rs.1689 crores within the timeline as indicated above, which direction shall make the Resolution Plan of the SRA compliant deserving approval.

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