Debt-ridden Jaypee Infratech's insolvency proceedings will continue for now as the Allahabad bench of NCLT has posted the matter for hearing on May 21 after lead lender IDBI sought extension of bankruptcy process beyond the deadline that expired on Monday. IDBI had approached the National Company Law Tribunal (NCLT) seeking extension of the corporate insolvency resolution process (CIRP) beyond the May 6 deadline as the proceedings are still underway to find a buyer for the Jaypee group's realty firm.

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According to sources, the Allahabad bench has posted the matter for hearing on May 21 and till then "status quo" will be maintained. A meeting of committee of creditors (CoC) has been scheduled on May 9, Jaypee Infratech's Interim Resolution Professional (IRP) Anuj Jain informed last week.

Sources had said the CoC will now discuss the proposal of state-owned NBCC to acquire Jaypee Infratech, the real estate arm of Jaypee group. Jaypee Infratech is a subsidiary of Jaiprakash Associates, the flaghsip firm of Jaypee group.

The creditors, which include banks and home buyers, on May 3 rejected the bid of Mumbai-based Suraksha group, the lone contender left after rejection of NBCC's bid on the ground that the offer did not have the approvals of government authorities.

As the NBCC has now got the necessary approvals, the CoC is ready to discuss on NBCC's bid once again on May 9.  On January 28 this year, the NCLT had extended the period of the CIRP by another 90 days as 180 days mandated under the Insolvency and Bankruptcy Code (IBC) was ending on February 5, 2019.

Under the IBC, a resolution process has to be completed under 180 days with a further extension of 90 days to 270 days. And if the company fails to complete the CIRP within the mandated 270 days, then the company goes for liquidation.

In the last hearing on April 29, IDBI had requested the tribunal to deduct the number of days in litigation period at several judicial forums, which include the National Company Law Appellate Tribunal (NCLAT) and the Supreme Court.

IDBI's plea was supported by the representative of the home buyers, who have also got the status of financial creditors after amendments in the IBC. However, the promoters of Jaypee Infratech had opposed any move to extend the resolution period.

In 2017, the NCLT admitted the application by an IDBI Bank-led consortium seeking resolution of Jaypee Infratech.

During the first round of insolvency proceedings, the Rs 7,350 crore bid of Lakshdeep, part of Suraksha group, was rejected by lenders as it was found to be substantially lower than the company's net worth and assets.

In October 2018, the resolution professional started a fresh initiative to revive Jaypee Infratech on the NCLT's direction.