COVID-19 and Issues of Rent, to be paid or not to be paid & Vacating premises -Adv. ROHiT ERANDE.

COVID-19 and Issues of Rent - to be paid or not to be paid &  Vacating premises..
-Adv. ROHiT ERANDE.  ©

If we throw a stone in a pond, it creates ripples around, though temporary. But Corona - COVID-19 has created ripples in our lives and we don't know how long it will subsist. Since last month, almost all the Business activities have come to an abrupt halt.  Employers and Employees, both are sailing in the same boat. It has hit the financial transactions and no one can predict, what will be it's effect.  Let's try to study these complicated  legal issues in nutshell. The Legal experts may have other opinion and I respect the same.

No Wage Cut and No dispossession of Tenants :
Amongst all, we have seen the the plight of Migrated Workers and special thanks to Fake News. Their Lordships have also expressed their concern and displeasure over the fake news, as a result of which lakhs of migrated workers .(Ref : Alakh Shirvastava V/s Union of India, WP (Civ.) No.468/2020). The Ministry of Home Affairs, vide it's order  dated 29/03/2020 has made its clear that, 'Where the workers including migrated workers are living, the Landlord shall not demand a rent for a period of 1 month". 
Pausing here for a moment, "not to demand does not amount to waiver".
In the said order, it has been given further directions to all the States and Union Territories that, if any Landlord is forcing Students /Workers to vacate the rented premises, then Landlord shall face action under Law".

Hon. Apex Court gives no Releif to Lawyers who demanded rent waiver :

Hon. Apex Court said no special treatment can be given to Lawyers who claimed that due to Lockdown they cannot pay exorbitant rent in Delhi and prayed for rent waiver. The Petition was allowy to be withdrawn with a liberty to approach govt.

Dispossession of Doctors and Healthcare Workers :
There have been these unfortunate incidents where Landlords or Societies are asking Doctors and healthcare workers  to stop their clinics or to leave the premises. This is unfortunate and per-se illegal. It is a settled principle of Law that even a Trespasser cannot be evicted without following due process of Law. 
Similarly by Law, no one can be restrained illegally from entering into his/her premises. Legal recourse is the only remedy.
 At one hand Govt. is asking Doctors to continue their clinics and at other hand, some of the doctors are facing such situation as Societies are not allowing Doctors to even enter into societies much less to open their clinics. Practically I feel, if one could reach Police Station, Police dept. is also under tremendous pressure and they might not be able to entertain the compliant.

Not to cut wages, but Employer also has some say.. 
The MOHA has further clarified that, all the Employers, be it in the Industries or in the shops & commercial establishment, shall make the payment to workers, without any deductions, during the lock-down.
However, from Employers' side few  questions have been raised, as to how much salary should be paid, as Salary includes various allowances like HRA, Petrol and Conveyance allowances, onsite allowances. If there is no site in progress, then whether on-site allowances and petrol allowances should be paid ? Many Industries have salary bill that runs in to lakhs-crores of rupees and in such case, when there is no business, whether still all the salary should be paid or minimum wages. that is the question, I feel.
PS : Hon. Apex Court has recently asked Govt. not to Prosecute Employers for non payment of the full wages during lockdown. The Order of MHA is under challenge. 

No immunity from paying Rent : 

This is the most important question, being faced by most us, may be the landlord or the Tenant. I refrain my self from touching the technicalities of Law, since common people might find it difficult to understand. 
The Rent or the License Fees, whatever the case may be, has to be paid as per the respective agreements. Many people think that clause of 'force-majeure' and principle of "frustration of contract' gives them immunity from paying the Rent /License Fees. 
'Force-majeure' clause or in simple words it is known as 'Act of God' e.g. Floods, Earthquakes, Droughts, War etc. make the performance of the contract impossible or the situation becomes irreversible and as these things are beyond the control of common men, the respective party is excused from either delaying its performance or complete termination. It depends upon the clause and its interpretation.
However, the COVID-19 and the Lock-down cannot be equated with 'Force-majeure' as its not permanent and do not render the contracts frustrated. On the similar lines, after going through the facts of the participial case, Hon. Bombay High Court in set of Writ Petitions filed by the Steel Exporters observed that "In any event the Lock-down would be for a limited period and the lock-down cannot come to the rescue of Petitioners so as to resile from its contractual obligations with Respondent No.1 of making payments."

Hon. Supreme Court disposed of the petition filed by Lawyers claiming waiver of rent in lock down period, Court said no special treatment can be given to Lawyers and asked the Petitioner to apporach Govt.

"Force Majeure is not applicable to leases and hence Tenant cannot refuse to pay rent ". This is the most recent Judgement of Hon. Delhi High Court.
(RAMANAND V/S. DR. GIRISH SONI
CM Appln No.10847/2020)

As per my humble opinion there is no such direct law which gives immunity to the Licensees/ Tenants from paying the rent in Lock-down period. If and only if, there is any contract to the contrary, then only the Tenant /Licensee may claim such immunity. One may also take into consideration the RBI Guidelines for loan moratorium. The RBI has left to the discretion of the Banks  give option of Moratorium i.e. temporary suspension of repayment of loans. It is not to be equated with discount or waiver. Rather those who are using credit cards should be very cautious as if there is any delay in payment, it charges very heavy interest. So one should take an informed decision.
Few financial experts have also opined that, those who can still pay the bank loan /rent, they should go on paying, as it will help the economy at the end.
Ultimately, as there is no straight law, I feel wisdom should prevail upon Employer-employee or Landlord-Tenant and as far as possible some mid-way should be found and it is certainly better than spending time, money and mental peace in Court.
Let's pray to the Almighty that we will over come the COVID-19 at the earliest. 

(These are my personal views and should not be considered as any legal opinion..Further the Notifications or Court Judgements may change at any time)

Thanks and Regards.

Adv. ROHiT ERANDE
Pune. ©