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India’s insolvency framework is helping revive stalled housing projects, with more than 1.4 lakh homebuyers moving closer to receiving their homes or already taking possession, according to industry analysts and officials.
Since 2018, homebuyers have held the status of financial creditors under the Insolvency and Bankruptcy Code (IBC). This has made insolvency proceedings an important route for completing stalled housing projects.
Developers such as Adani Realty and Lodha have entered several distressed projects, providing capital and execution support.
The backlog remains substantial. The 553 real estate insolvency cases admitted under the IBC involve nearly 2.5 lakh homebuyers, with only around 17 per cent resolved so far. Another 1.1 lakh buyers linked to 221 cases are still waiting for outcomes.
Projects that have been resolved represent investments of about Rs 84,000 crore, while roughly Rs 65,000 crore remains locked in unresolved developments.
The Insolvency and Bankruptcy Board of India (IBBI) has proposed reforms aimed at making project completion the primary objective. These include handling insolvency on a project-by-project basis, protecting project funds, simplifying claims and improving coordination between RERA authorities and insolvency courts.
Industry experts said lengthy litigation and appeals continue to slow resolutions. Rising construction, labour and financing costs can make older resolution plans difficult to execute.
Recent cases highlight the potential benefits.
Adani Realty acquired Mumbai’s Take Ten BKC project and committed more than Rs 1,000 crore towards completion. The development has since delivered homes to 903 buyers.
The developer took over the Bharat Nagar Slum Rehabilitation Project in BKC, where construction has resumed for nearly 1,000 families.
In Gurugram, the Hills-77 project enabled 724 buyers to receive possession. The Centre Court project secured an occupancy certificate, benefiting more than 300 homebuyers.
The IBC has enabled developers to acquire commercial assets, including Hotel Horizon in Mumbai and V Hotels.
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