If the real estate company is in poor financial condition and is unable to continue or finish the concerned real estate project, home-buyers can initiate insolvency proceedings in the National Company Law Tribunal.
Before initiating insolvency proceedings, sending a legal notice to the builder serves as a final warning. In case a settlement is still not reached, you should then file the application for initiating insolvency process.
Steps involved in Insolvency proceedings against the real estate company
Before your Payment
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REQUIREMENTS
Go through the detailed description on this page to understand the service
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CLARIFICATIONS
Connect with an expert via chat or request a callback to clarify any question
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BOOK THE SERVICE
Click on "Book this Service" to confirm your booking and initiate the process
After your Payment
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DOCUMENT VERIFICATION
You will be required to share scanned copies of documents related to the property for verification by a lawyer
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COMPLAINT DRAFTING
The application will be drafted and shared with you for your review and approval within 7 days of receiving the documents
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FILING OF COMPLAINT
The application will be filed before the NCLT within 3 working days of approval of the draft
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ADMISSION HEARING
The lawyer will make preliminary arguments before NCLT and get the Application admitted
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APPOINTMENT OF RESOLUTION PROFESSIONAL (RP)
NCLT will confirm a Resolution Professional to oversee the process
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CORPORATE INSOLVENCY RESOLUTION PROCESS
The resolution process comprises of various stages: 1) Publication of notice 2) Processing of claim 3) Information Memorandum 4) Meeting of Committee of Creditors (COC) 5) Call for resolution plan
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ACCEPTANCE/REJECTION OF RESOLUTION PLAN
After receiving the resolution plan, the RP will conduct a meeting of COC for voting. If 66% of voting is done in favour of a resolution plan, then it will be adopted by COC
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LIQUIDATION
In case where a resolution plan is not accepted, COC will opt for liquidation of such real estate company
Payment Structure
- You are required to pay 60% of the case fee to start the work
- 40% is payable upon settlement or final order
Required Documents
- Application for buying of property in the Project
- Builder-Buyer Agreement
- Receipts of payments made to the Builder
- Letters/ email correspondences between the Buyer and the Builder
- Brochure of the Project
- Letter of Allotment
Download Sample Files
10 Reviews
Getting down to the job is one of their positive points. I was really happy with the services.
The person who handled my case for so long had recently left the company, it resulted in some delays but I was so happy about how helpful Mr. Saurabh had been in this entire process
They handled my property case. I had no clue of how to go about it so in that time their lawyer helped me get justice. Very nice initiative.
I had invested in a property that was not even started to be built. They helped me in a very tough time to recover my money with compensation.
I recently booked a 3 BHK apartment at Sunrise Villas. Possession was due on 11th July, 2019. But one week before the due date, I had contacted the builder only to get vague responses. My friend told me about MyAdvo and I booked an appointment. Mr. Shubham helped me get in touch with a lawyer to draft a legal notice and that got the builders attention!
Professional team and the lawyer was indeed an expert in property laws. He helped me send the builder a legal notice for possession delay and I was able to move in within the next two months. Couldn't have been more relieved. 5/5!
I’m really happy with the service! I had the hardest time with my builder and was really frustrated. I came across the ad on MyAdvo and on our first meeting, they got me in touch with a good property lawyer who helped me with the legal proceedings of my case. They are professionals of the trade and payment process is both transparent and feasible.
I recently booked a 3 BHK apartment at Sunrise Villas. Possession was due on 11th July, 2019. But one week before the due date, I had contacted the builder only to get vague responses. My friend told me about MyAdvo and I booked an appointment. Mr. Shubham helped me get in touch with a lawyer to draft a legal notice and that got the builders attention!
I recently booked a 3 BHK apartment at Sunrise Villas. Possession was due on 11th July, 2019. But one week before the due date, I had contacted the builder only to get vague responses. My friend told me about MyAdvo and I booked an appointment. Mr. Shubham helped me get in touch with a lawyer to draft a legal notice and that got the builders attention!
I’m really happy with the service! I had the hardest time with my builder and was really frustrated. I came across the ad on MyAdvo and on our first meeting, they got me in touch with a good property lawyer who helped me with the legal proceedings of my case. They are professionals of the trade and payment process is both transparent and feasible.
Professional team and the lawyer was indeed an expert in property laws. He helped me send the builder a legal notice for possession delay and I was able to move in within the next two months. Couldn't have been more relieved. 5/5!
Frequently Asked Questions
1. What is NCLT?
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1. What is NCLT?
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1. What is NCLT?
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1. What is NCLT?
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The National Company Law Tribunal follows the Insolvency and Bankruptcy Code, 2016. It's a quasi-judicial body set up under section 408 of the Companies Act, 2013 with the authority to adjudicate the insolvency Process for both Companies and LLPs (Limited Liability Partnerships).
Powers of NCLT
NCLT is empowered under companies act to handle proceedings relating to:
- Arbitration
- Compromise
- Arrangements
- Reconstruction
- Winding up of companies
Benefits of NCLT
A national-level body like NCLT plays a critical role in bringing a corporate discipline. The tribunal has resolved corporate disputes that come under the purview of the Companies Act. There are many examples where the tribunal has:
- Resolved a critical corporate dispute
- Established standards of corporate governance
- Restored investor confidence in the economy
Formation of NCLT
It's headed by retired/Serving High Court Judge who is assisted by a technical member. The technical member should be from Indian Corporate Law Service, ICLS Cadre.
The tribunal has sixteen benches-
S.NO. | Bench City | Address | Jurisdiction |
1 | Principal Bench | Block No. 3, Ground Floor, 6th,7th & 8th Floor, CGO Complex, Lodhi Road, New Delhi-110003 | Delhi |
2 | New Delhi Bench | Same as above | Same as above |
3 | Ahmedabad Bench | 1st & 2nd Floor, Corporate Bhawan, Beside Zydus Hospital, Thaltej, Ahmedabad-380059 | Gujrat, Dadra & Nagar Haveli, Daman, and Diu |
4 | Allahabad Bench | 9th Floor, Sangam Place, Civil Lines Allahabad-211001 | Uttar Pradesh, Uttrakhand |
5 | Amravati Bench | Corporate Bhawan, Bandlaguda Tattiannaram Village, Hayatnagar Mandal, Rangareddy District, Hyderabad-500068 | Andhra Pradesh |
6 | Bengaluru Bench | Corporate Bhawan, 12th Floor, Raheja Towers, M.G., Road, Bengaluru-560001 | Karnataka |
7 | Chandigarh Bench | Ground Floor, Corporate Bhawan, Sector-27 B, Madhya, Marg, Chandigarh-160019 | Himachal Pradesh, Jammu, Kashmir, Punjab, Haryana, Chandigarh, Ladakh |
8 | Chennai Bench | Corporate Bhawan (UTI Building),3rd Floor, No. 29 Rajaji Salai, Chennai-600001 | Tamil Nadu, Puducherry |
9 | Cuttack Bench | Corporate Bhawan,CDA, Sector-1,Cuttack-753014 | Chhattisgarh, Odisha. |
10 | Guwahati Bench | 4th Floor, Prithvi Planet Behind Hanuman Mandir, G.S. Road, Guwahati-781007 | Arunachal Pradesh, Assam, Manipur, Mizoram, Tripura, Sikkim |
11 | Hyderabad Bench | Corporate Bhawan, Bandlaguda Tattiannaram Village, Hayatnagar Mandal, Rangareddy District, Hyderabad-500068 | Telangana |
12 | Indore Bench | 1st & 2nd Floor, Corporate Bhawan, Beside Zydus Hospital, Thaltej, Ahmedabad-380059 | Madhya Pradesh |
13 | Jaipur Bench | Corporate Bhawan, Residency Area, Civil Lines, Jaipur-302001 | Rajasthan. |
14 | Kochi Bench | Company Law Bhawan, BMC Road, Thrikkakara -(PO) Kakkanand, Kochi-682021(Kerala) | Kerala, Lakshadweep |
15 | Kolkata Bench | 5, Esplanade Row (West), Town Hall Ground and 1st Floor Kolkata-700001 | Bihar, Jharkhand, West Bengal, Andaman and Nicobar Island |
16 | Mumbai Bench | 4th Floor, MTNL Exchange Building, Near G.D. Somani Memorial School, G.D.Somani Marg, Cuffe Parade, Mumbai-400005 | Maharashtra, Goa |
2. What is the work of Nclt?
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2. What is the work of Nclt?
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2. What is the work of Nclt?
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2. What is the work of Nclt?
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Major Functions of NCLT:
- Power to cancel registration or dissolve a company
- Investigate the affairs of the company
- Freeze assets of a company
- Render liability to promoters
- Change the liability from limited to unlimited
- Address shareholder grievances on the rejection of companies in transferring shares and securities
- Can take class actions suits for depositors who are seeking remedy for the omissions and acts on part of the company
3. What is the NCLT process?
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3. What is the NCLT process?
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3. What is the NCLT process?
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3. What is the NCLT process?
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You have to submit a plea for insolvency to NCLT against the company. You will get a response from NCLT within 14 days; they will either accept or reject your plea.
After NCLT accepts your plea, they will appoint an IRP(Interim Resolution Professional. The IRP will draft a resolution plan. The IRPs are giving a 180 days time-frame which can be extendable by 90 days to come up with a resolution plan.
The court initiates a corporate Insolvency Resolution process once IRP submits the resolution plan.
During the period of an insolvency proceeding,
- the board of directors of the company stands suspended,
- and the promoters do not have a say in the management of the company.
The IRP, if required, can seek the support of the company’s management for day-to-day operations. In case the Corporate Insolvency Resolution Plan (CIRP) fails to revive the company, NCLT will initiate a liquidation process.
4. How to file a case in NCLT?
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4. How to file a case in NCLT?
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4. How to file a case in NCLT?
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4. How to file a case in NCLT?
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Step 1 - Send a legal notice to your developer mentioning the delay. You can hire a lawyer to help you with the process. The legal notice should make it clear that you are approaching NCLT as a financial creditor if your flat is not delivered in a specified time limit.
Step 2 - If you do not hear from the developer or they fail to the owner the commitment, reach out to NCLT bench under which your jurisdiction falls.
Step 3 - File an insolvency plea against the developer’s company. Once your plea is accepted, the IRP process would start.
I had to call consistently call my lawyer multiple times to get an update. I am glad I had a case manager helping me out