Supreme Court: Insolvency Cannot Be Used to Deny Citizens Dignified Housing
The Supreme Court has delivered a significant judgment affirming that the Insolvency and Bankruptcy Code (IBC), 2016 cannot be misused as a shield by defaulting developers to obstruct redevelopment projects. The ruling underscores that insolvency protection cannot supersede the constitutional right of residents to live in safe and habitable conditions. Background of the Dispute: Redevelopment of Kher Nagar Sukhsadan Society The case arose from the redevelopment of the Kher Nagar Sukhsadan Co-operative Housing Society in Bandra (East), Mumbai. The society had entered into a redevelopment agreement with AA Estates Private Limited in 2005, followed by a supplementary agreement in 2014. Despite more than a decade passing, no substantial redevelopment work had commenced. In 2017, the Municipal Corporation of Greater Mumbai (MCGM) issued notices declaring the structure unsafe for habitation, forcing residents to continue living in hazardous conditions. After continued delay, the society...