Coronavirus in Mumbai: Don’t penalise for project delay, developers tell MahaRERA

Coronavirus in Mumbai: Don’t penalise for project delay, developers tell MahaRERA

Force majeure is a delay in fulfilling a contract because of unforeseen circumstances.

Varun SinghUpdated: Tuesday, March 24, 2020, 04:23 AM IST
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MahaRERA |

Mumbai: With the state being in a state of virtual lockdown due to coronavirus, there is panic aplenty. The real estate industry too has been dealt a body blow, with work on most projects coming to a standstill. Developers and industry experts say projects delayed because of coronavirus should fall under the force majeure category.

Force majeure is a delay in fulfilling a contract because of unforeseen circumstances. Every developer involved in a project to sell apartments in Mumbai and Maharashtra must register with MahaRERA. While registering, they also must give a completion date.

With the current lockdown, many developers fear projects will get delayed and they may have to postpone the completion date. They are hoping that MahaRERA will consider their plea of force majeure specifically for delay because of the coronavirus lockdown and they won't be penalised.

Anand Gupta, spokesperson for the Builders Association, said, "There are several real estate projects which will get delayed because of the coronavirus lockdown. Simple mathematics says that if there is stop work on a project for a period close to one month, then it will be delayed by a month-and-a-half."

"In the current circumstances, projects are bound to be delayed and this comes under force majeure. We are also hopeful that RERA (MahaRERA) will understand the situation and not penalise builders for this, and allow extension," he added.

According to MahaRERA data, of the total 25,356 real estate projects seeking registration with MahaRERA, 25,060 projects were registered, and 5,280 projects are completed.

This means, close to 25,000 projects are ongoing and among these, the ones still at the construction stage will be impacted severely. Advocate Sanjay Chaturvedi, who represents cases at MahaRERA also says delay in construction caused because of the coronavirus lockdown will come under force majeure.

Chaturvedi said, "Indeed, the delay caused by the lockdown will come under force majeure. There is a lockdown, most workers have returned to their native places, the construction material suppliers have shut shop too. Under the prescribed sections of RERA rules, such delays come under force majeure.

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