In the recent development, the Ireo developers challenged the Insolvency Law in the Supreme Court under the section 5(8)(f) of the Insolvency and Bankruptcy Code 2016 that states addition of home buyers as the financial creditors of the company. The court ordered stay from the presently ongoing proceedings against them under the Insolvency Act.
Earlier last week Supertech, TDI Infrastructure and Ansal Properties also plea to the court against the Insolvency procedure that is currently being carried out against them. The Ireo developer is new to join these real estate firms
Aditya Parolia, partner, PSP Legal Advocates and Solicitors informed that the petition was filed against the Insolvency process soon after the Supreme Court ordered stay in January this year in the case filed by Pioneer Urban Land and Infrastructure.
He is advocating nearly 50 homebuyers against Ireo, Parsvnath and Ansal Properties.
The company pleaded to order directions against the amendment made in IBC [Insolvency and Bankruptcy Code]. The petition is filed under Article 32 of the Indian Constitution and challenge the validity of the explanation of section 5(8)(f), section 21 (6A)(b) and section 25 A of the Insolvency and Bankruptcy Code 2016 as being violations of articles 14 and 19(1)(g) of the constitution.
A bench of two judges including Justice Rohinton Fali Nariman and Justice Vineet Saran on 21st January ordered a stay of further proceedings before the National Company Law Tribunal.
In a quick development, all other above-mentioned developers moved to Supreme Court as soon as the court passed judgement in the Pioneer case. All these real estate companies seek stay in the insolvency cases running against them.
Daisy Chawla, a senior partner, Singh & Associates said that we should also have a look at the increased number of cases filed by a single or a group of homebuyers under the IBC code after the amendment was made for the purpose of delay in possession.