100 homebuyers' nod must for IBC against realtor, says Supreme Court

The top court also clarified that a company which is facing insolvency proceedings under the IBC can move an insolvency petition against other companies which owe it money

In a move that will safeguard real estate companies from frivolous litigation, the Supreme Court (SC) has upheld the constitutional validity of the Insolvency and Bankruptcy Code (IBC) amendment that requires at least 100 allottees, or 10 per cent of creditors, to invoke an insolvency petition against a company.

A Bench of Justices R F Nariman, Navin Sinha, and K M Joseph said in its 465-page order that insisting on a threshold with regard to these categories of creditors would lead to a halt in indiscriminate litigation which could result in uncontrollable docket explosion as far as the authorities who work