India’s Insolvency and Bankruptcy Code (IBC) was introduced to deal with financially distressed companies, improve creditor recoveries and give viable businesses a chance to recover. In real estate, it was also expected to offer a way out for stalled housing projects, allowing new investors or developers to step in and complete construction.
On paper, the idea makes sense. If a builder runs out of money, a structured resolution process can prevent a project from remaining abandoned indefinitely. Creditors get a chance to recover their dues, and homebuyers may finally have a route towards getting the homes they paid for.
For many, buying a home meant committing years of savings, taking out a loan and planning their lives…