Real estate (regulation & development) act, 2016 (RERA) came as a sigh of relief for the homebuyers (Financial creditors), providing them with adequate relief unlike available conventional remedies under civil and consumer laws
As per section 14 of the IBC 2016 and in the judgments it has been determined that during the moratorium period the invocation of guarantee against the ‘Company under Insolvency Proceedings/ CIRP.
A financial creditor(s) may file an application for initiating CIRP u/s 7 of IBC against a corporate debtor when a default has occurred.
After observing the current situation of the corporate debtor no creditor is willing to infuse more funds as they are afraid of losing the same through the enforcement of any law or authority under law.
Moratorium Period under section 14 of the code shall not apply upon such proceedings under the prevention of money laundering act.
Under section 14 of the code, the moratorium order is passed. Accordingly till the time moratorium period exists no other action or suit or case or proceedings against the corporate debtor can take place.
If anyone is looking to recover their debts in a time bound manner or resolution of the corporate debtor in a timely manner then IBC provides the necessary redressal.
The shareholders and promoters are not the creditors and thereby the resolution plan cannot balance the maximization of the value of assets of the corporate debtor
Earlier the winding up of the company was initiated and conducted under the Companies Act, 1956 while the same has got annulled after the advent of Insolvency and Bankruptcy Code.
The powers of the management of controlling the assets of the Corporate Debtor or Company is transferred to the Resolution Professional or the liquidator as the case may be.
RERA or IBC- Both the laws provides with the subjective approach depending upon the facts of the case and the situation of the developer.
Home buyers who had invested in housing projects by JIL, were permitted by the Interim Resolution Professional (IRP) to submit their claims as ‘other creditors’, subordinate to financial and operational creditors of JIL.
The Supreme Court of India in Mobilox Innovations Private Limited v Kirusa Software Private Limited has finally settled the widely debated question of what constitutes “existence of a dispute”.
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