{"id":16671,"date":"2021-09-24T13:33:28","date_gmt":"2021-09-24T08:03:28","guid":{"rendered":"https:\/\/carajput.com\/blog\/?p=16671"},"modified":"2022-01-29T19:21:42","modified_gmt":"2022-01-29T13:51:42","slug":"relief-for-homebuyers-under-ibc","status":"publish","type":"post","link":"https:\/\/carajput.com\/blog\/relief-for-homebuyers-under-ibc\/","title":{"rendered":"Relief for Homebuyers under IBC"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_58 counter-hierarchy ez-toc-counter ez-toc-light-blue ez-toc-container-direction\">\n<p class=\"ez-toc-title\">Page Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-69d6f411e5872\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #000000;color:#000000\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #000000;color:#000000\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-69d6f411e5872\"  aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/carajput.com\/blog\/relief-for-homebuyers-under-ibc\/#RELIEF_FOR_HOMEBUYERS_UNDER_IBC\" title=\"RELIEF FOR HOMEBUYERS UNDER IBC\u00a0\">RELIEF FOR HOMEBUYERS UNDER IBC\u00a0<\/a><ul class='ez-toc-list-level-3'><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/carajput.com\/blog\/relief-for-homebuyers-under-ibc\/#BANKRUPTCY_LAW_EFFICACY_FOR_HOMEBUYERS\" title=\"BANKRUPTCY LAW EFFICACY FOR HOMEBUYERS\">BANKRUPTCY LAW EFFICACY FOR HOMEBUYERS<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/carajput.com\/blog\/relief-for-homebuyers-under-ibc\/#Total_Details_of_CIRPs_resulted_into_liquidation_as_on_30092021\" title=\"Total Details of\u00a0\u00a0CIRPs resulted into liquidation as on 30.09.2021.\">Total Details of\u00a0\u00a0CIRPs resulted into liquidation as on 30.09.2021.<\/a><\/li><\/ul><\/li><\/ul><\/nav><\/div>\n<h2><img loading=\"lazy\" decoding=\"async\" class=\"alignnone wp-image-16672\" src=\"https:\/\/carajput.com\/blog\/wp-content\/uploads\/2021\/09\/Relief-For-Homebuyers-Under-IBC-300x182.png\" alt=\"Relief For Homebuyers Under IBC \" width=\"842\" height=\"511\" srcset=\"https:\/\/carajput.com\/blog\/wp-content\/uploads\/2021\/09\/Relief-For-Homebuyers-Under-IBC-300x182.png 300w, https:\/\/carajput.com\/blog\/wp-content\/uploads\/2021\/09\/Relief-For-Homebuyers-Under-IBC-1024x621.png 1024w, https:\/\/carajput.com\/blog\/wp-content\/uploads\/2021\/09\/Relief-For-Homebuyers-Under-IBC-768x465.png 768w, https:\/\/carajput.com\/blog\/wp-content\/uploads\/2021\/09\/Relief-For-Homebuyers-Under-IBC-800x485.png 800w, https:\/\/carajput.com\/blog\/wp-content\/uploads\/2021\/09\/Relief-For-Homebuyers-Under-IBC.png 1439w\" sizes=\"(max-width: 842px) 100vw, 842px\" \/><\/h2>\n<h2><span class=\"ez-toc-section\" id=\"RELIEF_FOR_HOMEBUYERS_UNDER_IBC\"><\/span><span style=\"color: #ff0000;\">RELIEF FOR HOMEBUYERS UNDER IBC\u00a0<\/span><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<ul>\n<li>Homebuyers battling the fight with the debt-laden builders are expected to be provided with certain relief as the government has tweaked provisions of IBC, thereby easing their pain.<\/li>\n<li>As reported earlier, during a recent tweaking of rules under the IBC, the Insolvency &amp; Bankruptcy Board of India asked resolution professionals to state within the resolution plan how different stakeholders are treated. Such a step was so expected to offer certain comfort to stakeholders like flat owners.<\/li>\n<li>Furthermore, the Ministry of Corporate Affairs geared up for certain crucial amendments to IBC, and the same is expected to produce more rights to individual consumers, consisting of worried homebuyers. Other consumers who may also benefit are telecom subscribers, said sources.<\/li>\n<li>The developments come as home buyers\u00a0are attempting\u00a0to search out\u00a0their feet amid proceedings against<a href=\"https:\/\/carajput.com\/learn\/wilful-defaulters-under-ibc-2016.html\"> Jaypee Infratech\u00a0and a few\u00a0of the entities of Amrapali Group.<\/a><\/li>\n<li>A senior official from the MCA said there was\u00a0a touch\u00a0of problem in ensuring that homebuyers receive\u00a0a status\u00a0up to\u00a0banks, as lenders will then become reluctant to lend to builders.<\/li>\n<li>Earlier, the IBBI had introduced Form F, which the house owners can use to file for raising their claims. At present, whether or not homeowners fill Form F, their claim would be looked into after dues of monetary institutions are settled. Also, there&#8217;s no regulation that talks about creditors aside from financial and operational ones.<\/li>\n<li>According to the days of India, the IBBI&#8217;s revised rules, which were notified last week, would make sure that financial creditors (banks) and other creditors (operational ones like workmen and service providers) don&#8217;t move to secure their own interests while ignoring those of others.<\/li>\n<li>On September 20 more than 100 hassled home buyers, booking their dream homes with Amrapali Group, moved to Supreme Court, for seeking that relief or safeguarded and requesting treating as secured creditors. These were the house buyers, who neither got possession nor was refunded their hard-earned money, being paid at the time of booking homes.<\/li>\n<li>As reported in the month of September, the legal teams representing Jaypee Infratech were expected\u00a0to possess\u00a0their hands full. Distraught buyers of their yet-to-come-homes\u00a0arrange to\u00a0bombard the developer with up to 4,000 individual civil and criminal cases. After the Supreme Court\u00a0stay\u00a0the NCLT order regarding insolvency proceeding against Jaypee,<\/li>\n<li>the buyers have developed a method that has bigger and more vocal protests, meeting various ministers, serving request letters to the prime minister\u2019s office and even filing police complaints.<\/li>\n<li>Under all these actions, the main plan was to bombard them with multiple\u00a0lawsuits,\u00a0so that the developers are engaged and tangled in legal hassles from all around.\u00a0They&#8217;re\u00a0an enormous\u00a0company but even for them to handle 4,000 individual cases would be\u00a0plenty. Also, there are certain home buyers, having already filed\u00a0proceedings\u00a0over non-possession of promised property and also the charges involving cheating.<\/li>\n<li>As reported earlier,\u00a0in an exceedingly\u00a0recent tweaking of rules under the IBC, the Insolvency &amp; Bankruptcy Board of India asked resolution professionals to state\u00a0within the\u00a0resolution plan how different stakeholders are treated.\u00a0this can\u00a0also offer some comfort to stakeholders like flat owners.<\/li>\n<li>Referring to the tweak, a lawyer specialising in bankruptcy cases told the national daily: \u201cThe change\u00a0within the\u00a0rules has plugged\u00a0a niche\u00a0as flat buyers are of the view that\u00a0there&#8217;s\u00a0nothing\u00a0to shield\u00a0their interests.\u201d On September 20, over 100 hassled home buyers, who had booked dream homes with Amrapali Group firms, moved the Supreme Court seeking that their interests be safeguarded by treating them as secured creditors like banks and financial institutions.<\/li>\n<li>The house buyers, who have neither got possession of flats, nor a refund of their hard-earned invested money had booked homes within the Amrapali Centurion Park-Low Rise project, Amrapali Centurion Park-Terrace Homes, and Amrapali Centurion Park-Tropical Garden at Greater Noida in Uttar Pradesh.<\/li>\n<li>Recently, certain legal experts argued that certain relevant laws are required to be amended in order to recognize buyers\u2019 lien. Such an opinion was urged mainly due to the insolvency proceedings initiated against Jaypee Infratech and Amrapali Group companies.<\/li>\n<li>An estimated 1 million homebuyers could also be curst ongoing housing projects, where either construction is stalled or moving at a snail\u2019s pace. In some cases, the company entity undertaking the project is on the brink of facing insolvency proceedings.<\/li>\n<\/ul>\n<h3><span class=\"ez-toc-section\" id=\"BANKRUPTCY_LAW_EFFICACY_FOR_HOMEBUYERS\"><\/span><span style=\"color: #ff0000;\"><strong>BANKRUPTCY LAW EFFICACY FOR HOMEBUYERS<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p><img loading=\"lazy\" decoding=\"async\" class=\" wp-image-16679\" src=\"https:\/\/carajput.com\/blog\/wp-content\/uploads\/2021\/09\/Picture1-300x252.jpg\" alt=\"BANKRUPTCY LAW EFFICACY FOR HOMEBUYERS\" width=\"754\" height=\"634\" srcset=\"https:\/\/carajput.com\/blog\/wp-content\/uploads\/2021\/09\/Picture1-300x252.jpg 300w, https:\/\/carajput.com\/blog\/wp-content\/uploads\/2021\/09\/Picture1.jpg 627w\" sizes=\"(max-width: 754px) 100vw, 754px\" \/><\/p>\n<ul>\n<li>NEW DELHI: Four years ago, Kanupriya was among the 20,000 homebuyers in Jaypee Infratech\u2019s project in Noida who\u00a0hoped\u00a0that an early resolution will help her take possession of the apartment she had booked in 2012.<\/li>\n<li>She\u00a0continues to be\u00a0waiting\u00a0because the\u00a0resolution process \u2013 monitored directly by the Supreme Court \u2013 seems\u00a0to own\u00a0entered\u00a0the ultimate\u00a0leg.<\/li>\n<li>Jaypee\u00a0is also\u00a0the foremost\u00a0high-profile case where the\u00a0search for\u00a0a resolution applicant continues but there are several other\u00a0assets\u00a0projects across the country where homebuyers\u00a0still\u00a0face uncertainty.<\/li>\n<li>After a period of 5 years, wince the Insolvency &amp; Bankruptcy Code was notified, it has been observed that only 8 resolution plans have been so far approved in the\u00a0assets\u00a0sector, though around 205 cases had been admitted until March 2021.<\/li>\n<li>Thus, we can conclude that IBC cases have a success rate of less than 4%, and hence making it the worst-performing sector, after computer and related activity.<\/li>\n<\/ul>\n<ul>\n<li>Unlike other sectors, where the banks or the operational creditors drag the corporate debtor to the National Company Law Tribunal, in realty sector, there is an extra challenge since it involves the protection of interests of homebuyers, who invest their hard-earned money in this sector.<\/li>\n<li>Thus, it is the sole area where even the govt has to take up certain action and make an exception thereby recognizing the homebuyers as financial creditors, instead of operational creditors.<\/li>\n<li>A change in recognition was required since they were not giving an equal say to decide on the new resolution applicant under the earlier case. RERA, which implies protecting buyers who may have a loan, is another case in point. Moreover, the foundations keep evolving, which makes it difficult to befits newer guidelines when a developer looks to require over a project.<\/li>\n<li>Basically, these regulations and guidelines are still\u00a0added\u00a0progress\u00a0and wish\u00a0to evolve further. It is still believed that there are still certain major upgrades required in respect of previous lack of regulation and redressal mechanisms.<\/li>\n<li>For banks, the first focus of the resolution exercise is to minimize the hit that they need to require on their loans and maximise the gains. In contrast, homebuyers need a more stable company to require over the corporate whether or not it means that lenders would have to take a haircut.<\/li>\n<li>Projects normally aren\u2019t commercially viable, where the price of construction is quite receivables and financial creditors comprises financial institutions and homebuyers. Also, in many of the cases funds are expected to be diverted and as a result, the corporate entity falls short of funds to construct the units. Apart from this, even the market doesn\u2019t have adequate liquidity to support assets quality and value.<\/li>\n<li>There are other complications when land is owned by\u00a0quite\u00a0one entity and it\u00a0has to\u00a0be combined. In case of such combinations, the project insolvency applies to the specific entity since in IBC we don\u2019t have any scope for project or group insolvency.<\/li>\n<li>Such a problem with the resolution provides for the necessity of suggestions and review of provisions.<\/li>\n<\/ul>\n<h3><span class=\"ez-toc-section\" id=\"Total_Details_of_CIRPs_resulted_into_liquidation_as_on_30092021\"><\/span><a href=\"https:\/\/www.ibbi.gov.in\/uploads\/whatsnew\/e3b6a345b4e704f8a7f70c83fbb9be78.pdf\" data-cke-saved-href=\"https:\/\/www.ibbi.gov.in\/uploads\/whatsnew\/e3b6a345b4e704f8a7f70c83fbb9be78.pdf\"><strong>Total Details of\u00a0\u00a0CIRPs resulted into liquidation as on 30.09.2021.<\/strong><\/a><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>IBBI released data of CIRPs resulted into liquidation as on 30.09.2021 (Since IBC came in force),\u00a0Total admitted claims of INR 7414 Billions in 1423 Corporate Debtors. Resolution plans received only in 296 cases.<\/p>\n<p><iframe loading=\"lazy\" title=\"Fast Track Insolvency: Fast-Track Insolvency Resolution Procedure | What is Fast Track process?\" width=\"640\" height=\"360\" src=\"https:\/\/www.youtube.com\/embed\/tYxE5-DweSM?feature=oembed\" frameborder=\"0\" allow=\"accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture\" allowfullscreen><\/iframe><\/p>\n<p><strong>Popular Article :\u00a0<\/strong><\/p>\n<ul>\n<li><a href=\"https:\/\/carajput.com\/blog\/ibc-forms-insolvency-and-bankruptcy-code-2016-forms-demand-notices-returns\/\">Complete\u00a0Coverage about the IBC Form\u00a0<\/a><\/li>\n<li><a href=\"https:\/\/carajput.com\/blog\/ibc-forms-insolvency-and-bankruptcy-code-2016-forms-demand-notices-returns\/\" data-cke-saved-href=\"https:\/\/carajput.com\/blog\/ibc-forms-insolvency-and-bankruptcy-code-2016-forms-demand-notices-returns\/\">All the Forms and returns under IBC Law\u00a0<\/a><\/li>\n<li><a href=\"https:\/\/carajput.com\/press-releases\/notification-under-section-10a-of-the-ibc-code-2016.pdf\" data-cke-saved-href=\"https:\/\/carajput.com\/press-releases\/notification-under-section-10a-of-the-ibc-code-2016.pdf\">Notification under section 10A of the IBC Code, 2016<\/a><\/li>\n<li><a href=\"https:\/\/carajput.com\/press-releases\/the-ibc-application-to-adjudicating-authority-amendment-rules-2020.pdf\" target=\"_blank\" rel=\"noopener\" data-cke-saved-href=\"https:\/\/carajput.com\/press-releases\/the-ibc-application-to-adjudicating-authority-amendment-rules-2020.pdf\">The IBC (Application to Adjudicating Authority) (Amendment) Rules, 2020<\/a><\/li>\n<\/ul>\n","protected":false},"excerpt":{"rendered":"<p>RELIEF FOR HOMEBUYERS UNDER IBC\u00a0 Homebuyers battling the fight with the debt-laden builders are expected to be provided with certain relief as the government has tweaked provisions of IBC, thereby easing their pain. As reported earlier, during a recent tweaking of rules under the IBC, the Insolvency &amp; Bankruptcy Board of India asked resolution professionals &hellip;<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[8789],"tags":[10018],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/posts\/16671"}],"collection":[{"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/comments?post=16671"}],"version-history":[{"count":5,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/posts\/16671\/revisions"}],"predecessor-version":[{"id":21639,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/posts\/16671\/revisions\/21639"}],"wp:attachment":[{"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/media?parent=16671"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/categories?post=16671"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/tags?post=16671"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}