India, April 13 -- The National Company Law Appellate Tribunal has reaffirmed that insolvency proceedings initiated by homebuyers against realty firms must remain confined to the specific project where default has occurred and cannot extend to other projects of the corporate debtor.

The appellate tribunal highlighted that putting all other projects of the realty firms, which are unrelated to the default, is not in the interest of homebuyers and other stakeholders of other projects.

"The law is well settled that when financial creditors, homebuyers who belong to one project and who file a Section 7 application on account of default committed by the corporate debtor with respect to the project, the CIRP has to confine to the said projects...