In Brief
Homebuyers of Jaypee Infratech Limited sought protection when the company faced insolvency proceedings. The Supreme Court held that homebuyers should be recognized as financial creditors under the amended Insolvency and Bankruptcy Code (effective June 2018). The Court revived the Corporate Insolvency Resolution Process with a fresh 180-day timeline, allowing reconstitution of the creditor committee to include homebuyers. The erstwhile promoters were barred from participation under Section 29A. The Court refused to make pro-rata disbursements from deposited funds during the process, maintaining statutory discipline. The Reserve Bank of India was permitted to initiate insolvency against the parent company. The judgment balanced creditor interests with homebuyer protection through statutory mechanisms rather than judicial supervision."
The lawyer headnote and full judgment text are available to registered users.