IBC FOR HOMEBUYERS
As per IBC regulations, only financial creditors can be part of the committee of creditors (COC). COC decides every aspect regarding the proposal for revival, resolution process etc. Prior to amendment in 2018, the homebuyers or allottees were not part of financial creditors. Hence they could not participate in COC which triggered a demand to include the homebuyers under financial creditors.
On 06/06/2018, the allottees in real estate projects were included under the category of financial creditor with an explanation inserted in section 5(8) of IBC, through IBC (Amendment) Ordinance, 2018. Now, the homebuyer or allottee in the real real project can initiate insolvency process as financial creditor.
HOW IBC MAY HELP HOME-BUYERS?
IBC provisions may be a great support to home buyers who are facing a delay in possession or non-refund of money etc. Lets give a brief for some prevalent circumstances :
1. Delay in possession – As per a research by our RERA Deptt, approx. 70% of the real estate projects are delayed in terms of delivery. And approx. Rs. 5.80 Lac Crs are struck in such projects. If the claim & default are being arisen out of the agreement or by order of any court/authority order, you can file the case under IBC to initiate insolvency process.
2. The project is abandoned – If the project is abandoned, you may approach to NCLT under IBC to start corporate insolvency resolution process subject to the terms of the agreement and other legal parameters.
3. Non-refund of the agreed amount – If the allotment letter or agreement gives the right to claim the refund of the given amount and such obligation qualify to be a default under IBC, the petition can be filed before NCLT under IBC for recovery.
4. Subvention scheme – There are many kinds of subvention scheme which are being offered by the builders to attract the buyers. Many of such scheme are not complied with correctly. If there is any time value of money or consideration for use of money and such obligation qualifies as default under IBC, the allottee may file the petition before NCLT under IBC.
FILING OF CLAIM BEFORE NCLT
Many of builder are facing CIRP (corporate Insolvency resolution process) before NCLT. Filing of claim is compulsory to participate in the CIRP process and recover the amount from the company. After filing of the claim, the different resolution proposals from IRP or RP are required to be evaluated. It requires to keep track of development in the CIRP.
Centrik is having strong teams for both for RERA and IBC. Team RERA has handled more than 600 litigation case across India. The team of IBC consists of qualified insolvency professional. Both the departments work in synchronization for maximization of value and provide justice. For more information please reach us at firstname.lastname@example.org or call our support.