1) you should submit form CA
2) it depends upon the assets of the builder
3) your registration would not be void of claim is rejected
Builder Issue
Dear Sir/Madam, I bought an under construction apartment and the construction has been going on for a long time. Recently, an insolvency resolution process has been initiated. Because of this IRP, my association has adviced us to fill 'Form CA- For claims by financial creditors in a class' and submit it to the Interim Resolution Professional. I need your opinion about submitting this form-ca. Can you please provide your suggestions on the following queries? 1. As my property is already registered, is it safe to submit the form-ca? 2. What are the chances of getting the claim in such cases? 3. If I submit the form-ca to interim resolution professional, and if the judgment is not in favor of our association, as per individual expectations, will my apartment registration become void? and do I have to compulsorily accept the compensation that is given to me, if any? or do I have the option to hold on my registration and the ownership of the apartment? Please provide your valuable suggestions. Thank you.
Asked 6 years ago in Property Law
Religion: Other
11 Answers
Hi
Insolvency process means that builder can't construct the building/apartment and in this conditions, you much get your money through IRP. Hence go for it.
In such a case, if the claim is very less than what I have claimed, do I have the option to reject a claim, etc? we were asked to submit the sale deed, payments made, etc. If I accept the claim, what would be the fate of a registered flat? It is just that the builder will not attend the claimed flat anymore?
Asked 6 years ago
Builder is being declared insolvent
your chances of obtaining delivery of flat are bleak
3) submit documents to IR
4) accept money offered to you
5) once you accept the claim amount your registration of flat would be cancelled
Hi,
You must not agree for lesser amount. You have not mentioned as to whether registered flat is constructed or not. If not constructed, registration will be void. If constructed, you should ask possession of that in settlement process.
1. Well, if the construction is not finished and hence you do not have possession over the property then you must raise your claim. It means that this project would be abandoned by the builder and there would be no guarantee that it would be finished by another anytime soon.
2. The scope would depend on the money that would be found available for distribution among his borrowers. SO First find out information from the case as regards money remaining at his disposal and claims raised by other creditors.
3. No, the registration of your flat would be intact even if your claim is ignored by the Tribunal.
1. Yes you can submit the claim.
2. Since builder is not able to complete the construction you may get the claimed amount.
3. Registration will not be void.
1. See IRP shall take claim as made by you and substantiated by you with documents since resolution is passed against builder getting flat ready and chances of possession are less.
Until recently, all the flat buyers in the project would not only risk losing their hard-earned savings but would also have to forgo the hefty interest paid on their home loans. This is because the builder's financial creditors would have first charge on his fixed assets, including properties under construction.
But the Centre has now come to the rescue of such distraught homebuyers, with President Ram Nath Kovind giving his approval in May, to the promulgation of an ordinance to the Insolvency and Bankruptcy code (IBC), 2018. Under this ordinance, flat owners will be treated as 'financial creditors', on a par banks and other financial institutions during debt recovery.
The ordinance is path-breaking in that the homebuyer, as a financial creditor, can recover the money he paid to a bankrupt builder from the sale of its assets. This includes properties under construction, the builder's company and associated assets. Apart from enjoying legal powers equal to those of the banks, home buyers will also have voting rights that would enable them to participate objectively in the insolvency resolution process and shield their interests in the same way as those of the banks. They will get due representation in the Committee of Creditors (CoC) that voluntarily takes a call on resolution proposals for the bankrupt firm.
Your subsequent questions on the claim amount are based on unfounded or imaginary concepts.
There are lot of process going on, hence claim amount shall be paid in proportion as and when the funds are available for disbursement to the creditors.
If there is courts direction you need submit the same. If you are not satisfactory to the amount offered you can approach the court. You can accept it under protest and approach court for balance amount
Dear Client
- Yes it will be safe to submit form CA. As you will become creditor of the firm and creditors will have claims first as they will be on top rank for claims.
- The chances for getting the claims are good as a creditor than a buyer.
- Yes registration will become null and void. And you have to accept the compensation which would be offered to you.
