In a landmark ruling, the Supreme Court has affirmed that the right to housing is a fundamental right under Article 21 of the Constitution, directing the Union Government to establish a revival fund to support stressed real estate projects under insolvency proceedings.
The Bench of Justice JB Pardiwala and Justice R Mahadevan emphasized that the aim must be to prevent liquidation of viable projects and safeguard the interests of genuine homebuyers. “This is not just about houses or apartments—the banking sector, allied industries, and employment of a large populace are at stake,” the Court observed.
The judgment upheld a 2020 NCLAT ruling that dismissed speculative investment claims in insolvency cases. The Court clarified that speculative buyers—those investing for profit rather than genuine housing needs—cannot misuse the Insolvency and Bankruptcy Code (IBC). Instead, they must seek remedies under RERA, consumer protection laws, or civil courts.
The Court directed that its order be circulated to the Cabinet Secretary and all State Chief Secretaries for urgent action. It further recommended that the revival fund undergo periodic audits by the CAG, with reports made accessible to the public.
Highlighting the government’s constitutional responsibility, the Bench stressed that it “cannot remain a silent spectator” while homebuyers’ interests and the broader economy are at risk. The Court reiterated that housing is not just a contractual entitlement but an integral aspect of the right to life under Article 21.
The case stemmed from a petition where an allottee had invested in a financial scheme disguised as a housing agreement. The Court reaffirmed that the IBC is a remedial framework for revival of companies and cannot serve as a recovery tool for speculative investors.
“Genuine homebuyers represent the backbone of India’s urban future. Their protection is both a constitutional obligation and an economic necessity,” the judgment concluded.
Case Title: Mansi Brar Fernandes vs Shubha Sharma & Anr. (with connected cases)
Citation: 2025 LiveLaw (SC) 903
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