Force Majeure and The Impact of Covid-19 on RERA Registered Projects

ABSTRACT

Researcher had finished his data collection and interviewing of domain experts by the first week of March 2021 and had put together the entire paper, the nationwide lock-down due to COVID-19 meant that the final submission/release of this paper was pushed forward by three to four months. Hence, this paper mainly covers the pre-lock-down and post scenario. It took a considerable amount of time to check State-wise details (for all States), rules, loopholes, issues and to find out best practices and key initiatives rolled out across States. There are a few significant developments that took place after 21 March 2020 when the lock-down was announced and till March 2021. COVID-19 should be declared as a Force Majeure event for all construction contracts, Architectural & engineering design contracts under implementation or under service. With the recent increase in the number of COVID-19 cases in India, the likelihood of the lockdown being extended is high. This would only prolong the misery of the already bleeding real estate sector and potentially expose the promoters to a vast number of claims and complaints. On the extension of timelines for delivery of possession, whilst the principles of law will be considered in terms of force majeure clauses in the Agreements and the specific facts of the case, considering the gravity of the present situation, impact of lockdown and the detrimental effect on the economy, we would expect the relevant RERA Authority/ Courts to adopt a more balanced approach and direct resolutions to any disputes in this regard factoring equities.