The recovery rate has increased almost three times i.e. from 26.5% in 2018 to 71.6% in 2019 and the time taken for recovery improved from 4.3 years to 1.6 years within a short span of one year.
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
NCLT Principal Bench vide its order dated 20.08. 2019 has ordered insolvency proceedings U/S 7 of the Insolvency and Bankruptcy Code, 2016 against Real Estate Developer, M/S Raheja Developers Limited. Every creditor of M/s Raheja Developers need to file their claims before the Insolvency Resolution Professional(IRP).
It is to be understood that the objective of IBC is not to provide benefit only to selective creditors but to protect the interests of all the stakeholders.
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
Aggrieved homebuyers from the Piyush colonizer esteemed developer in the past started a housing project in the City of Faridabad, approached the HRERA bench stating their grievance.
Homebuyers to file the claim under IBC rather than adopting a way which is not legally realistic wherein the insolvency orders are passed against the builder’s company.
According to the terms of loan resolution in the Insolvency and Bankruptcy Code, the first preference on recovery is to secured financial creditors, followed by unsecured financial creditors, and then operational creditors.
The Liquidator has a fiduciary responsibility with the Company and its creditors. The major goal of choosing a Liquidator is to resurrect a failing firm and operate professionally.
Insolvency Professionals eligible to be appointed as Liquidator alongside written consent form within 10 days of the direction issued, and upon receipt of the proposal, the order of appointment of Liquidator is passed.
Filing Claim under IBC- It becomes very important to understand why every creditor should file their claims?
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.
In a significant ruling, the National Company Law Tribunal (NCLT) Kolkata, comprising Smt. Bidisha Banerjee (Judicial Member) and Shri D. Arvind (Technical Member),
The major challenges in the insolvency resolution of real estate companies arise from the peculiarities of this sector, especially since the divergent interests of the allottees of the real estate projects do not align with the scheme of the CIRP.
The fast-track CIRP is designed to expedite the insolvency process for smaller companies and enable their efficient restructuring or liquidation.
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