SHIFT IN INSOLVENCY OBJECTIVES FROM CORPORATE REVIVAL TO PROJECT COMPLETION

The Insolvency and Bankruptcy Code of 2016 was established with a singular, creditor-focused aim to salvage the corporate debtor as a viable going concern entity. However, the real estate industry, with its multitude of retail homebuyers, pre-sold but undelivered housing units, and corporate structures involved in multiple projects, consistently highlighted the shortcomings of this generic model. This paper contends that Indian insolvency law is experiencing a change: transitioning from corporate revival as the primary goal to project completion as the key criterion in real estate insolvency. This change, recorded in several Supreme Court rulings from Pioneer Urban Land & Infrastructure Ltd upholding homebuyers as financial creditors to Mansi Brar Fernandez, establishing homebuyer rights under Article 21 by holding that homebuyers are not risk-taking lenders, they are individuals who have invested their lifetime savings in housing. This paper warns against an unexamined embrace of the change. Currently, project-completion insolvency functions without explicit statutory approval, leaving resolution applicants legally exposed, and threatening the finality doctrine. Judicial innovation, despite good intentions, cannot replace a clear legislative framework.