The arrest of Manoj Gaur, Managing Director of Jaypee Infratech, by the Enforcement Directorate on Thursday comes after years of tumult at the company and the Jaypee Group. As per sources, the ED has alleged that Jaypee Associates Ltd, through Manoj Gaur, is involved in a Rs 12,000-crore fraud, including diversion and siphoning of home buyers’ funds.
Jaypee Infratech went into insolvency in 2017 following an application filed by a consortium led by IDBI Bank. Last March, the National Company Law Tribunal approved the bid of Mumbai-based Suraksha Group and the final takeover took place last May after the National Company Law Appellate Tribunal approved the resolution plan with the provision that Suraksha would pay Rs 1,335 crore as compensation to farmers in the Yamuna Expressway Industrial Development Authority (YEIDA).
At the heart of the insolvency proceedings around Jaypee Infratech was the Jaypee Wish Town project in Noida where the group had to deliver over 32,000 units to buyers of which just about 4,900 were delivered before the start of the proceedings.
The ED investigation has been looking into alleged fraud in Jaypee Wish Town, where flats were sold in 2010–11 but not delivered. Following protests from homebuyers on project delays and alleged diversion of funds, multiple FIRs were also filed in 2017.
Meanwhile, Jaiprakash Associates Ltd (JAL), the flagship firm of the Jaypee Group, is also undergoing insolvency proceedings and is under the ED lens. JAL, which has interests in real estate, cement manufacturing, hospitality, and engineering & construction, was admitted for insolvency in 2024 following default in payment of loans and creditors have claimed Rs 57,185 crore.
The resolution process is seen to be in the last stages now and voting on the bids by the five applicants is underway. The Committee of Creditors for JAL is set to meet on November 14.
Five companies, including Adani Enterprises, Vedanta Group, Dalmia Bharat Cement, Jindal Power and PNC Infratech have submitted their resolution plans to acquire the company.
