YEIDA questions Jaiprakash Associates' plan to clear land dues in Allahabad HC

The Yamuna Expressway Industrial Development Authority (YEIDA) has raised concerns in the Allahabad High Court regarding a plan put forth by Jaiprakash Associates Ltd (JAL) to settle outstanding dues, which led to the cancellation of 1,000 hectares of land allotted to the company. The disputed land was initially allocated to JAL for the development of a Sports City along the Yamuna Expressway, but was subsequently revoked by YEIDA on February 12, 2020. In an attempt to rectify the situation, JAL approached the high court expressing its willingness to clear all outstanding payments and present a resolution plan for completing residential projects.

However, conflicting figures regarding the amount of land dues have been presented by both parties. While YEIDA claims that JAL owes Rs 3,621 crore, the company insists that the outstanding amount is no more than Rs 1,483 crore. JAL's resolution plan involves selling 150 acres of land in the "core area" to generate the necessary funds for repayment.

YEIDA has expressed doubt about the feasibility of this plan, arguing that the land in question is already mortgaged to a third party. JAL's report states that it possesses 61.4 acres of housing land, 81.7 acres of commercial land, and 5.2 acres of institutional land within the "core area" of YEIDA. According to estimates, the value of this land amounts to Rs 2,755 crore, nearly double the amount claimed by JAL as its debt to YEIDA.

JAL has informed the court of its intention to sell or sublease the land within one year of receiving the high court's order, with the proceeds being deposited into an escrow account. YEIDA would then be able to withdraw up to Rs 1,483 crore from the account, while the remaining funds would be held until the legal proceedings are concluded.

YEIDA has raised objections to the plan, highlighting that the land is encumbered due to the existing mortgage. In an affidavit, YEIDA argued that JAL's proposal to sell or sublease the "unencumbered land" lacks credibility. The mortgagee bank or financial institution, YEIDA contends, is likely to demand the settlement of its outstanding dues as a priority, significantly reducing the remaining amount available to the Authority.

JAL has been given a period of time to release the encumbrance from the land in the "core area." The next hearing in the case is scheduled for July 13, allowing further deliberation on the matter to take place. The outcome of these proceedings will determine the future course of action regarding the outstanding land dues and the fate of the Sports City project along the Yamuna Expressway.

Next (Tamil Nadu Housing Board places petition box to resolve plaints)

YEIDA questions Jaiprakash Associates' plan to clear land dues in Allahabad HC

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