Homebuyers’ Body Urges PM Modi To Stop Proposed Amendment To IBC In Favour Of Builders
Pedestrians walk past apartment buildings in Delhi, India. (Photographer: Ruhani Kaur/Bloomberg)

Homebuyers’ Body Urges PM Modi To Stop Proposed Amendment To IBC In Favour Of Builders

Bookmark

Homebuyers' body Forum for People's Collective Efforts has written to Prime Minister Narendra Modi to intervene and stop any proposed amendments in the Insolvency and Bankruptcy Code to dilute rights of flat owners, who have been declared as financial creditors under the law.

With individual homebuyers taking builders to bankruptcy court, rattled real-estate developers from Delhi-National Capital Region are demanding that all consumer complaints first be heard by regulator Real Estate (Regulation and Development) Act before insolvency proceedings are initiated.

FPCE President Abhay Upadhyay has written a letter to the Prime Minister, appealing him to intervene and "stop the proposed amendment to the Insolvency and Bankruptcy Code being demanded by builders".

He alleged that real estate developers are making every attempt to thwart all steps taken by the government to empower homebuyers and bring reforms in the sector.

"We strongly oppose any such proposed amendment to IBC," Upadhyay said.

Opposing the proposed move, the association said an accused developer can not be allowed to decide in which court they should be dragged by his victim just to suit his comfort.

"We would like to apprise your government that any amendment to dilute the rights of homebuyer under IBC will send a wrong message and derail the whole process of reforming the real estate sector," he said.

Under the IBC, a single creditor (operational/financial) whose due is rupees one lakh or more can drag a corporate entity to the National Company Law Tribunal, then how can a single homebuyer be barred whose financial stake will be many times more than this amount, Upadhyay added.

"It is absurd to demand that the accused should not be dragged to a court of law till his victim finds other victims and joins hands to become eligible to approach a court of law. It is akin to saying that no one should approach a police station against a person who is guilty of murder till he finds other victims of murder by the accused and joins hands," he said in the letter.

The association hoped that the Prime Minister will continue efforts to empower the home-buyers, who have immensely suffered at the hands of real estate developers since decades.

It urged the PM to ensure that "no amendment is undertaken which dilutes IBC in favour of developers and/or weakens the right of homebuyers".

BQ Install

Bloomberg Quint

Add BloombergQuint App to Home screen.