Plight of citizens who pay tax is disheartening: SC on homebuyers, Pg11

Key Highlights:

• The Supreme Court urged the Union government to protect homebuyers' interests and prevent the liquidation of viable residential projects.
• The court suggested establishing a revival fund under NARCL and expanding the SWAMIH Fund for stressed projects undergoing Corporate Insolvency Resolution Process (CIRP).
• A committee headed by a retired High Court Judge will be formed within three months to suggest reforms for the real estate sector.
• The court highlighted that housing is a facet of the Fundamental Right to Life under Article 21.

Detailed Insights:

• The court proposed creating a corporate body similar to NARCL, promoted by real estate and construction-focused PSUs, to take over and complete stalled projects under the Insolvency and Bankruptcy Code (IBC).
• Unsold inventory from revived projects could be used for affordable housing schemes like PMAY or government quarters, addressing both the housing shortage and project revival.
• The court dismissed challenges to NCLAT orders that rejected claims of speculative buyers in IBC proceedings, stating such arrangements inflate demand and prejudice genuine buyers.
• The court directed the Union Government to bring uniformity in RERA Rules across states to remove ambiguity and strengthen the legislation.
• Housing Boards, State-level Urban Development Authorities, and CPSUs should establish dedicated wings to revive stalled projects under IBC mechanisms.

Key Concepts Involved:

• NARCL (National Asset Reconstruction Company Ltd): An asset reconstruction company that acquires and resolves stressed assets.
• SWAMIH (Special Window for Affordable and Mid-Income Housing) Fund: A government-sponsored fund providing financing for stressed affordable and mid-income housing projects.
• RERA (Real Estate Regulatory Authority): Acts as the regulatory body for the real estate sector and protects the interests of the home buyers.
• IBC (Insolvency and Bankruptcy Code): A law that consolidates and amends laws relating to reorganization and insolvency resolution of corporate persons, partnership firms and individuals in a time bound manner.