The Emerging Paradigm Of Project-Specific Resolution In IBC: Tracing The Genesis, Evolution And Judicial Trends
- IJLLR Journal
- Jul 31
- 1 min read
Srinivasan Harini, Campus Law Centre, Faculty of Law, University of Delhi
ABSTRACT
This article traces the evolution of the project-specific corporate insolvency resolution process, a judicially developed model not expressly provided for in the Insolvency and Bankruptcy Code, 2016, but crafted to address the unique concerns of homebuyers. It begins by examining the rationale behind recognizing homebuyers as financial creditors, a foundational shift that acknowledged their vulnerability in real estate insolvencies. Unlike traditional lenders, homebuyers seek possession of a home rather than monetary repayment, necessitating a distinct legal and practical treatment.
The article then explores how adjudicatory bodies, especially the National Company Law Appellate Tribunal, developed the project-specific model as a tailored mechanism that confines insolvency to the specific defaulting project. This innovation preserves asset value and directly serves the interests of homebuyers, who often represent the majority of stakeholders in such cases.
By analyzing key judicial pronouncements, the article shows how courts themselves have observed that this approach aligns with the objectives and legislative vision of the Code, particularly in ensuring fairness, protecting stakeholders, and maximizing asset utility. Finally, the article examines the technical and procedural contours of implementing project-specific resolution, offering a comprehensive account of its legal foundation, operational framework, and judicial legitimacy.
