A bench of Justices A.M. Khanwilkar and Dinesh Maheshwari made the recommendation while hearing a plea filed by Chitra Sharma, an aggrieved homebuyer of Jaypee Infratech Ltd (JIL).
Sharma sought a direction to the government not to allow the liquidation of the company as it would be against the interests of thousands of homebuyers.
The bench observed that the Insolvency and Bankruptcy Code (IBC) was inadequate to protect homebuyers' interests.
It observed that the court had in similar matters asked the government to step in and come up with a proposal.
The court has listed the matter for further hearing on July 11.
Earlier, in a separate matter, the Supreme Court asked the government to examine a proposal to resume construction on stalled housing projects of real estate major Unitech Ltd within 10 days to protect the interests of homebuyers.
In the Jaypee Infratech matter, Chitra Sharma's advocate Ashwarya Sinha also urged the top court to order a complete forensic audit of JIL since its incorporation to ascertain how the company has spent funds meant for the housing projects.
The petition has been moved at a time when the JIL is facing insolvency proceedings because of the huge debts owed to banks.
The petitioner apprehended that if JIL goes into liquidation, then thousands of homebuyers would be left in the lurch without any remedy.
The application cited the apex court judgment passed in August 2018 stating that liquidation of JIL will not help homebuyers, more than 20,000 of whom have invested their life savings.
The application alleged that the real estate company had diverted the funds to other projects on a larger scale than Amrapali Group of Companies, which is also involved in a legal battle with homebuyers.
( With inputs from IANS )