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SC orders Jaypee to deposit Rs 2k crore; directors can’t leave country without permission

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Jaypee Infratech

[vc_row][vc_column][vc_column_text]Real-estate major also told that it can’t sell any property without seeking prior permission and consent of the court

The Supreme Court bench of Chief Justice Dipak Misra and Justices DY Chandrachud and AM Khanwilkar, on Monday (September 11), passed stringent directives on the promoters and directors of Jaypee Infratech and ordered that they are not to leave the country without prior permission of the court. Their associates have also been directed to deposit Rs 2,000 crore on or before October 27.

The bench also directed that if any property is to be sold by the real-estate major, the sale will take place after obtaining permission and consent of the court.

While the Union government has argued for the case to be dealt with by the Insolvency Code, petitioner Chitra Sharma has said that this will leave homeowners in the lurch, because they come way down in the order of preference as per the code. After paying off top creditors such as the banks and even small time employees of the projects (such as watchmen) there is likely to be nothing left from the proceeds of liquidation for the homeowners.

Earlier, a group of Jaypee Infratech home buyers had moved the Supreme Court, seeking relief against a National Company Law Tribunal (NCLT) order which stayed all court proceedings against the company, including those pending before the consumer courts. On September 5, IDBI Bank had requested the apex court to restore the insolvency proceedings against the realtor.

They also urged the apex court to declare home buyers as ‘secured creditors’ to help them get first right on the company’s assets in case of insolvency.

On Monday, Attorney General KK Venugopal, said that the very purpose of insolvency proceedings is to revive the company.

Additional Solicitor General Tushar Mehta, appearing for the Insolvency and Bankruptcy Board of India, said: “Insolvency professionals will re-structure the company’s scheme and will ensure the supplies and deliveries of the flats to all buyers.”

Justice Misra said: “Kindly give this court a scheme, illustrating, how they will pay the debts of all creditors.  This scheme should also show how the parent company’s and its sister company’s assets will be restructured and how they will deliver the flats to homebuyers.”

“We are not concerned with the assets of the company. We are only concerned with interests of all the home buyers,” said the Chief Justice. “It is our constitutional duty to give paramount consideration to valuable interest of all home buyers. Many of them are from middle class income groups.”

Senior advocate P Chidambaram, appearing for the home buyers, requested the court to include all the homebuyers in the category of secured creditors. He said that the scheme of Insolvency and Bankruptcy Code of India (IBC) doesn’t include them as creditors or secured creditors. The resolution plan of insolvency proceedings will throw them out.”

Justice Misra said: “We are not inclined to change the statutory interest. We are just giving utmost consideration to the interests of homebuyers and secured creditors.”

The Attorney General asked for time to frame and submit the scheme of the Insolvency Resolution Profession (IRP).

The Chief Justice ordered: “In modification of the order dated September 4, we issue the following directions:

  1. The IRP will submit the scheme of payment to the creditors and delivery of flats to the home buyers.
  2. The company or any of its associate companies will not alienate any of its property in any manner.
  3. The managing directors and directors of the respondents (3 and 4) will not leave the country, without prior permission of this court.
  4. The respondents, subject to their arguments and submissions, will deposit certain amounts with this court.
  5. IRP will take over all the management of the Jaypee Infratech Ltd. and pass the interim resolutions.
  6. Respondent 4 (an associate) is not the party to this suit. It will deposit Rs 2,000 crore on or before27/10/2017. If any property is to be sold, the sale will take place after obtaining permission and consent of this court.
  7. Any person who is the director of any of the companies at the time of the IRP proceedings, will not leave the country without obtaining the permission of this court, except nominee directors of the lenders – IDBI, ICCI and SBI.”

The court also allowed all interventions.

The matter has been listed again for November 13.[/vc_column_text][/vc_column][/vc_row]

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Adani, Torrent compete to purchase Gujarat Titans from CVC Capital

The probable sale of the Gujarat Titans, with the lock-in period coming to a close, will therefore be a defining moment in the changing face of IPL investments.

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The Adani Group and Torrent Group are currently negotiating a deal with private equity firm CVC Capital Partners to offload a controlling stake in the Indian Premier League franchise Gujarat Titans. According to sources, close to the development, reports say CVC Capital Partners will be looking to sell a majority interest while retaining a minority share in the franchise.

This becomes important because it is aligned with the end of the lock-in period by the Board of Control for Cricket in India (BCCI), which restricts any new teams from selling stakes until February 2025. The three-year-old franchise Gujarat Titans is reportedly worth $1 billion to $1.5 billion. CVC Capital Partners had paid ₹5,625 crore for the franchise in 2021.

A source close to the development pointed out that IPL franchises have attracted many investors’ interest since the league has proved an asset with a good reputation for money-making capabilities and cash flows. This growing interest of investors embodies the financial value and stability that come with the IPL franchises.

Gautam Adani, who owns teams in the Women’s Premier League and UAE-based International League T20, is understood to be one of the serious buyers. In 2023, Adani’s group won the Ahmedabad franchise in the WPL with a bid of Rs1,289 crore, the highest offer. His interests in this potential deal signal his commitment to expanding his footprint in the cricketing world.

Arvinder Singh, COO of Gujarat Titans, exuded confidence in the financial future of the franchise. He said the team was confident of turning profitable in the next media rights cycle, referring to even the original ten IPL franchises that took four to five years to turn profitable. He added confidently that the Gujarat Titans would not only turn profitable but significantly enhance in brand value.
 
This surging interest of investors in it is evidence of the growing financial attractiveness of IPL franchises, driven by healthy revenue streams and an increasing global footprint. The probable sale of the Gujarat Titans, with the lock-in period coming to a close, will therefore be a defining moment in the changing face of IPL investments.

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PayTm share price slips 2 per cent over SEBI warning

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Paytm

The share price of PayTm fell by nearly 2 per cent on Tuesday following a warning from the the Securities and Exchange Board of India (SEBI).

PayTm’s parent One 97 Communication had got SEBI’s administrative warning letter on some transactions involving the PayTm Payments Bank during fiscal year 2021-2022. The bourses reacted strongly leading to PayTm shares falling by 1.88% to Rs 460.80 per share on the Bombay Stock Exchange.

SEBI said it had noted the violation with concern and said these matters are being viewed very seriously. The regulator warned the company to exercise caution going forward and improve compliance to rules to prevent similar incidents in the future.

The markets regulator added that failure to comply with rules may force it to invoke enforcement actions as per the law.

In its response to SEBI, PayTm said in a media release that it has always followed listing regulations, as well as any change to these rules over time. The company said it would keep up its commitment to maintain and follow high standards of compliance. Paytm said it intends to provide an adequate response to SEBI on this matter.

PayTm said it has always followed Regulation 23 along with Regulation 4(1)(h) of the SEBI Listing Regulations, without including any change made to these rules over time. Paytm added that the letter from  SEBI has no influence on its finances, operations or other activities in any way.

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Zomato, Swiggy hike platform fee by 6% 

After the hike, the platform fee would be Rs 6 per order from an earlier Rs 5 per order.

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The food delivery majors, Zomato and Swiggy, have recently increased their platform fee by 6 per cent for food orders initially in Delhi and Bengaluru.

The food giant is currently charging in the national capital and IT hub, Bengaluru, the platform fee is distinct from delivery fee, goods and services GST, handling charge and restaurant charges.

After the hike, the platform fee would be Rs 6 per order from an earlier Rs 5 per order. Gradually, the higher platform fee is expected to roll out to other cities as well.

Notably, this fee is applicable universally to all food orders, irrespective of customer enrollment in loyalty programmes offered by both food giants. The charges directly contribute to the companies’ revenue streams and cost management efforts. The platform fee goes to the food aggregators to apparently control costs and increase revenues.

In April, they charged Rs 5 per order, but now it’s been increased by Rs 6 per order. That’s a 20% increase in fees for food delivery. This change in their strategy to adjust the price in a market as they expand their services.

Increase in platform fees, impacting how much customers pay for their food deliveries across the board. When customers order food using the app, they will notice different charges, besides the platform fees. These include delivery fees, handling fees, GST (Goods and Services Tax), and charges from the restaurant.

The charges earned by the platform, directly go to the food delivery app, helping to manage all expenses and boost their wages. The food delivery platform aimed to make between Rs 1.25 to Rs 1.5 crore per day through the fee, the app charges.

In August last year, Zomato introduced platform fees of Rs 2 per order for the first time. In October, they raised their platform fees from Rs 2 to Rs 3 in most and in major cities. Additionally,  Zomato is a quick commerce platform.

According to reports, Zomato stock reached its highest price of Rs 232 on the Bombay Stock Exchange. This achievement has made Zomato founder and CEO, Deepinder Goyal, a billionaire. The company has experienced a strong upward trend over the past years, driven largely by the expansion and success of its quick commerce subsidiary in Blinkit.

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