INDIA Law and Practice Contributed by: Vivek Chandy, Archana Tewary, Kumarmanglam Vijay and Megha Arora, JSA
paid by the purchaser on a sale and by the les - see on a lease. Although licences are not normally required to be registered, it is mandated by certain states (such as Maharashtra under the Maharashtra Rent Control Act). 6.21 Forced Eviction Where a tenant is in breach of the lease, the landlord would have to follow the procedure set out in the lease deed to evict the tenant, includ - ing giving the tenant an opportunity to cure the default. Thereafter, the landlord can issue a notice of termination and initiate legal action to recover the premises (and mesne profits) where the tenant remains in occupation. Where termi - nation is during the lock-in period, the landlord may seek lease rent for the balance of the lock-in period. The process of tenant eviction may take three to seven years. 6.22 Termination by a Third Party A third party cannot terminate a lease unless contractually agreed. If a condemnation event by a government body occurs, the lease will stand terminated as the property will vest with the gov - ernmental authority concerned. Compensation for such acquisition is typically paid to the owner of the property, unless the sharing of compensa - tion is contractually agreed between the owner and the lessee. 6.23 Remedies/Damages for Breach Such remedies are typically limited to the abil - ity of the landlord to claim remaining rent and mesne profits. Such claims are also subject to limitation laws; claims may be made within three years of the breach pursuant to which the claim has arisen. In India, only direct damages can be claimed, unless a party has undertaken to indemnify the counterparty for any specific kinds
of losses. Typically, landlords collect IFRSD and may take bank guarantees to ensure they have adequate remedies in case of a tenant’s breach. Landlords may also pursue arbitration or court proceedings, depending on the terms of the lease deed. 7. Construction 7.1 Common Structures Used to Price Construction Projects Construction contracts are typically categorised as lump-sum turnkey fixed-price contracts, bill of quantities-based contracts (item-rate con - tracts), and work package-based contracts. For projects where a detailed bill of quantities is possible, owners opt for an item-rate contract. For large infrastructure construction projects, lump-sum turnkey contracts and work package- based contracts are common. Regardless of pricing structure, construc - tion contracts incorporate detailed clauses to address eventualities that may affect comple - tion time and contract price, including change in law, force majeure, change in scope/variation and suspension. Contracts typically provide for mechanisms to adjust the contract price upon the occurrence of such eventualities. Con - tractually agreed price escalation clauses with thresholds are also negotiated – eg, escalation on account of a change in the price of a speci - fied raw material. 7.2 Assigning Responsibility for the Design and Construction of a Project Split structures and design-and-build struc - tures are commonly used for risk allocation and rewards for construction projects.
359 CHAMBERS.COM
Powered by FlippingBook