The National Company Law Appellate Tribunal (NCLAT) has ruled that insolvency proceedings initiated by homebuyers against realty firms should be confined to the specific project in default. This decision aims to protect the interests of homebuyers and stakeholders involved in unrelated projects who might otherwise be adversely affected.
The judgment was delivered in an appeal by Navin M Raheja, with the tribunal emphasizing that corporate insolvency resolution processes (CIRP) are to be managed on a project-by-project basis. The tribunal referenced a previous case involving Raheja Developers, reinforcing the principle that CIRPs should not jeopardize other unrelated projects.
The tribunal ordered that all claims filed by creditors and stakeholders must pertain only to the project in question, specifically the Krishna Housing Scheme in this instance. Stakeholders have been advised to submit their claims within the stipulated timeline as per the CIRP Regulations, 2016. This decision underscores the need for precise and project-specific insolvency proceedings.
(With inputs from agencies.)