After getting a go-ahead from the Union Cabinet, the Central Government will table the bill for considering home buyers as financial creditors during the ongoing Monsoon session of the Parliament. Law Minister, Ravi Shankar Prasad shared this news after the cabinet meeting which was presided by Prime Minister Narendra Modi. This bill will replace the older version of Insolvency and Bankruptcy Code (Amendment) Ordinance, 2018 which was promulgated by President Ram Nath Kovind a month ago.
This bill will offer huge relief to the home buyers as they will be known as the financial creditors. This reputation will also allow the aspiring home buyers to have representation in CoC [Committee of Creditors] and they will become an essential part of the decision-making process.
The home buyers will have the right to file a complaint against the delinquent developers under Section 7 of the IBC [Insolvency and Bankruptcy Code] while seeking insolvency resolution procedure.
The Cabinet gave promulgation to amendments of IBC [Insolvency and Bankruptcy Code] two months back. The ordinance also offers a procedure to withdraw the case filed by the under the Code. The person requires having the approval of the CoC [Committee of Creditors] and 90 percent of the voting share to withdraw a case against the developer.
However, the withdrawal of case is only permissible before publication of notice inviting Expressions of Interest i.e EoI.