NEW DELHI: On Wednesday, Finance Minister Nirmala Sitharaman announced that the committee of creditors (CoC) will now be able to invite land authorities to its meetings for discussions regarding regulatory and land-related issues under the insolvency regulations. This move aims to expedite the resolution of bankruptcy cases involving numerous real estate projects.
While addressing the Rajya Sabha on the Insolvency and Bankruptcy Code (Amendment) Bill, 2025, Sitharaman stated that the amendments narrow the scope of adjudication for case admissions and set stricter timelines to accelerate resolution and enhance the value of stressed assets.
The Rajya Sabha has passed the bill, which the Lok Sabha approved on Monday, paving the way for its enactment following presidential assent. The minister emphasized that the proposed framework for cross-border insolvency will include sufficient parliamentary oversight, while the mechanism for addressing insolvency in corporate groups will include safeguards to prevent misuse.
Real estate cases
Sitharaman noted that land authorities can now engage in CoC meetings to assess “the legitimacy of these lands and properties.” Out of the 565 real estate cases admitted under the IBC, 111 cases involving 162,320 homebuyers have been resolved, with another 210 currently under review. Of these, 87 resolution plans are pending approval by the National Company Law Tribunal, with expectations to finalize them in the coming months, benefiting approximately 50,000 homebuyers. Additionally, around 200 cases have been withdrawn or closed, while 44 have proceeded to liquidation.
IBC not a recovery tool
Sitharaman asserted that the insolvency law is not intended as a means for debt recovery or liquidation of distressed assets but rather aims to provide solutions for troubled companies. However, she acknowledged that some companies may still face liquidation if no viable resolution is achieved. To expedite the process, the bill proposes that the NCLT admit insolvency cases within 14 days and approve resolution plans within 30 days, requiring justification for any delays.
