The central government is likely to step in to protect the interest of homebuyers whose investments face uncertainty when bankruptcy proceedings are filed against builders.
The government is considering two options. First, amend the bankruptcy law so that homebuyers do not lose out to banks and financial institutions when a defaulting builders properties are liquidated and debts settled. Second, change the laws operational rules to make homebuyers trustees so that their investments are mandatorily protected.
More than 31,000 homebuyers have been affected by insolvency proceedings against some projects of Jaypee Infratech and Amrapali. Their vulnerability stems from the fact that they figure very low in the creditors order for payment of du…
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