Against the company
NCLT
Dear Sir , i am a home buyer and have executed a builder-buyer agreement with a PVT ltd company ( of a builder ). However this Pvt Ltd Company is a subsidiary/JV of another company of same builder which is a listed company. Since the builder has defaulted and I plan to file for NCLT , in case my matter gets admitted will the bankruptcy proceedings commence only for PVT Ltd company or the entire group.
Asked 6 years ago in Property Law
Religion: Hindu
11 Answers
It would be only against the private limited company and not the entire group of companies
As a home buyer you are not entitled to file bankruptcy petition against your builder company, since home buyer is not considered as operational creditor under IBC law .
This proposition of law has been laid down by NCLT . Your petition shall not be accepted by the tribunal. It will stand dismissed instantly.
1. The insolvency proceeding will start only against he company which fails to execute the project.
2 The group company will remain unaffected.
It will commence only for that particular company and not for the group.
the insolvency proceeding will commence only against the private limited company since it is a separate legal entity
Insolvency shall proceed agasint PVT ltd company, only in case complete recovery could not be made from assets PVT ltd company than the concept of group of companies doctrine can be invoke to complete the recovery from another company which has considerable hold and investment in PVT ltd company.
Dear Sir,
Strengthening the homebuyers’ position against defaulting developers, the Supreme Court, on August 9, 2019, upheld amendments to the Insolvency and Bankruptcy Code (IBC), under which buyers get the status of financial creditors, if a builder were to go insolvent. The top court also ruled that the real estate law (RERA) should be read harmoniously with the amendments made in the IBC, but the Code would prevail, in case of a conflict.
On August 1, 2019, the Parliament approved the Insolvency and Bankruptcy Code (Amendment) Bill, 2019, to 'strengthen' the role of homebuyers, when resolution plans of embattled real estate developers are worked out.
The amendments to seven sections of the code, gives the committee of creditors (CoC) of a defaulting company explicit authority over the distribution of proceeds, in the resolution process. It also states that the resolution plans for cases that reach the IBC, must be worked out within 330 days. Further, the resolution plan worked out by the CoC, would be binding on all authorities concerned, the central government said.
It must be noted that thousands of homebuyers, who have invested in various projects of insolvency-hit developers, which include high-profile cases of Japyee, Amrapali and Unitech, have failed to get much relief. After waiting for their homes for several years, these buyers' cases are now before the National Company Law Tribunal (NCLT) and the Supreme Court (SC). A more efficient insolvency code that clearly establishes their rights in the CoC ─ buyers are part of this ─ would mean that homebuyers would have a larger role in the resolution plan.
The provisions specify the professionals i.e., Company Secretaries, Chartered Accountants and Advocates who can practice before the NCLT or NCLAT.
Key points to be kept in mind while filing petition/application under section 252(1) or section 252 (3) of the Companies Act, 2013 before the NCLT court.
RERA bench has been set up in Noida to adjudicate the builder buyer disputes . ... If builder will not act per notice then file case in consumer court for deficiency in service. Mohammed Mujeeb ... You need not to file a case in National Company Law Tribunal (NCLT).
The case will only be against the pvt ltd company and not on entire group.
only for that particular company and not for the entire group of companies .
The proceedings will be based on your case alone and not for the entire business done by the company.
You can approach the NCLT as a creditor with the said case against the company
