Flat in Possession of Allottee Not to be Included in the Liquidation Estate
March 15, 2024
IBBI introduces key amendments to the IBBI (Liquidation Process) Regulations, 2016, with effect from 12th February 2024.
The amendment provides for exclusion of the flat in possession of the allottee form the liquidator estate,
“46A. Exclusion of certain assets from the liquidation estate.
For the purposes of clause (e) of sub-section (4) of section 36, wherever the corporate debtor has given possession to an allottee in a real estate project, such asset shall not form a part of the liquidation estate of the corporate debtor.“
The amendment was introduced in the backdrop of numerous applications pending before Tribunals across states to adjudicate the claims of homebuyers against the real estate developers under liquidation. Prior to the amendment, the homebuyer who had received possession of their property were bundled together with homebuyers who had not received the possession of their property eventually leaving them with no remedy except being entitled to a refund of the consideration amount paid by the homebuyers in the event of the developer going into liquidation.
The lauded move of the IBBI will certainly come to the relief of the homebuyers who put in their hard-earned money to have their dream home.
Circular Ref. No. IBBI/PR/2024/07