After years of stagnation in resolving the debt issue with Jaiprakash Associates, a recent NCLT order has revealed that the ICICI Bank, the lead lender in this case, and JP Associates have jointly requested the NCLT to postpone the IBC hearings until the end of November.

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Both parties have indicated that they are currently engaged in negotiations for a loan restructuring proposal, the details of which are currently being formalised and will soon be presented to the lenders.

Sources within the banking industry, as reported by CNBC-TV18, have disclosed that lenders have been in discussions with the National Asset Reconstruction Company (NARCL) regarding the resolution of the debt. This involves selling the loan account to NARCL and, in return, receiving certain security receipts and a promise of eventual recovery.

However, the precise terms of the offer from NARCL have yet to be provided to the banks, leaving the extent of potential recovery uncertain.

The loan restructuring talks between the lenders and JP Associates have been ongoing for several years, with limited progress made, as per information from banking sources.

It is important to note that this marks a five-year delay in the resolution process. ICICI Bank referred JP Associates to the NCLT in 2018, and since then, substantial progress has remained elusive. JP Associates currently holds a debt of approximately ₹29,000 crores, with SBI, ICICI Bank, and IDBI being some of the principal lenders involved.

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