A detailed means of action is being sought after by the Ministry of Housing and Urban Affairs to protect those homebuyers who are victims of the builders facing insolvency.
As told by a senior official of the Ministry, they want to be reassured that this act of protection is meant for the homebuyers that come under the vulnerable category. They have joined hands with the Ministries of Finance and Corporate Affairs with the sole expectation of fully protecting the interests of such homebuyers who are prone to attacks by builders.
The IBBI (Insolvency & Bankruptcy Board of India) made amendments on the fifth of October, this year. It has made it mandatory for the company to state in its resolution how it has tackled all its stakeholders’ interests in different projects, which appeared as a move for comforting homebuyers. The law that has protected the Government revenues, creditors and lenders’ interests, has been found to be demanding in the case of homebuyers. They are the ones who have spent the savings of their lifetime just to unknowingly invest in the projects of companies facing insolvency. In the words of Government sources, such problems in the Real Estate industry were not imagined during the enactment of this Act.
Hardeep Singh Puri, the Minister of Urban Affairs, brought his concern into the focus of the Finance Minister, Arun Jaitley. This intervention at the ministerial level has resulted in this notification of IBBI. Previously, other amendments have been initiated to handle the challenges that are emerging for the homebuyers.
According to the Government sources, the current issues will remain restricted to the ongoing projects without expanding further. The various legal reforms in the recent years such as the enactment of the RERA(Real Estate Regulatory Authority), implementation of GST and IBC are sufficient for safeguarding the homebuyers’ interests.
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