The narrow margin of vote share between the Suraksha group and NBCC, in the debt resolution of Jaypee Infratech, could trigger a demand for a revote by the latter. Suraksha group’s bid was selected by the Committee of Creditors (CoC) with 98.66 per cent votes, narrowly beating NBCC which got 98.54 votes.

Nadiya Sarguroh - Senior Associate MZM Legal said as per the recent amendment by the Insolvency and Bankruptcy Board of India (IBBI) to the Corporate Insolvency Resolution Process (CIRP) , simultaneous voting on two or more resolution plans complying with the resolution matrix has been made permissible. “However, the law as it stands today does not make a provision for breaking a tie between two resolution plans receiving the same number of votes or having a marginal difference,” she said.

Though there is no provision for providing rebidding opportunities in black and white under the IBC, it appears that NBCC might appeal to the NCLT under its inherent powers for issuance of fresh bids and a round of revoting, considering the marginal difference in the percentage of voting, said Sarguroh.

Also read: Suraksha Realty outbids NBCC for Jaypee Infra

However, other experts said that the IBC rules allow the committee of creditors to select the bid which has received the highest vote share irrespective of the winning margin.

Suharsh Sinha, Partner, AZB & Partners said the threshold for plan approval is 66 per cent and if all plans receive more than 66 per cent then the plan with the highest voting percentage wins regardless of how narrow the margin is.

“It would be prudent for banks to vote in favour of one plan to avoid being on the losing side which leads to a classification as dissenting financial creditors who are entitled to only its liquidation value – that is generally a lower amount,” he said.

Suraj Malik, Partner, BDO India LLP said every resolution plan is evaluated against pre-defined parameters including the quantum and timing of payment to stakeholders. Once approved by the CoC and then NCLT, there is no re-bidding.

“Only if a resolution applicant believes their proposal has not been appropriately evaluated, can they approach the NCALT for relief. There are pre-approved evaluation metrics in every IBC resolution against which plans are evaluated. Suraksha’s proposal would have received more votes as it may have been more aligned with the evaluation metrics,” said Malik.

Also read: Jaypee Infratech shares decline nearly 5% after earnings announcement

Some of the eligible voters found the plan of Suraksha more promising vis-a-vis NBCC, which helped them to win the bid by a small margin, he further said.

Last week, the debt resolution plan submitted by Mumbai-based Suraksha Realty Limited along with Lakshdeep Investments and Finance Private Limited was selected as the winning bid to acquire Jaypee Infratech by its Committee of Creditors.

Suraksha Group had offered 2,552 acres of land to secured financial creditors with a fair value of ₹6,456 crore, ₹1,280 crore as instruments to secured financial creditors and ₹29 crore repayment to FD holders.

NBCC had offered 1,903-acre land to bankers and 90 per cent stake in Yamuna Expressway including 4,660 acres of expressway land and 137.85 acres of commercial land for development. NBCC also offered additional 100 acres, to be earmarked for payment to be made to the homebuyers.

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