The Supreme Court order in the Jaypee insolvency case is a clear indication that the government must amend the Insolvency and Bankruptcy Code (IBC) and give adequate representation to homebuyers interest.
Enacted last August, the IBC aims to first restructure the debt of a company, failing which, it goes into liquidation. The Code has made provisions for the appointment of insolvency resolution professional after the company fails to pay the debt of its creditors.
But while it gives representation to all types of creditors in the resolution proceedings of a company, it doesnt recognise homebuyers as creditors nor has it any provision to represent them in resolution proceedings.
This lacuna was first highlighted in the Jaypee Infratech inso…
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