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Construction Industry in distress: VCCI

VCCI-hailed-AP-New-Industrial-Policy

The office-bearers of the Vizagpatam Chambers of Commerce and Industry headed by the President of VCCI Mr.Veera Mohan, Hon. Secretary Mr.Ravi Godey and Mr.Dharmendra, Director today briefed the press regarding the recent issues faced by the construction industry.

They appealed to the Hon. Chief Minister, Chief Secretary, Minister of Urban Development Authority, Principal Secretary, Ministry of Urban Development Authority and Municipal Commissioner regarding plaguing issues of Construction and Real Estates sectors, which are in distress due to the Coronavirus pandemic. The Union Government also declared in the pandemic as the calamity caused by nature and should be considered as “Force Majeure”.

The Government of India in certain Ministries has also declared this pandemic to be a force majeure in their procurement contract. There is a reference for such a declaration due to COVID-19 vide Office Memorandum dated 19th February 2020 issued Ministry of Finance (Procurement Division) Government of India on Force Majeure Clause.

In the absence of such a declaration, the effect otherwise would make such projects become a ‘default’ due to delay and thus put a humungous strain on these projects and would then lead to a collapse of the Real Estate Industry as a whole. We believe that such a declaration would be in the larger interest of not only the industry but all stakeholders involved, including the customers.

In the interest of the Construction Industry The Vizagpatam Chamber of Commerce and Industry has requested the government to consider the following:

1. To permit 6months exempted/extended period of the delivery of projects under the ‘force majeure’ explanation clause under section 6 of the Real Estate (Regulation and Development) Act, 2016.

2. Extend the validity period by 12months for all building and layout approvals.

3. Permit the builders to pay various fees on an installment basis for this financial year.

The chamber’s body hopes that the AP Government will take the inputs into consideration for necessary revival action of the Real Estate sector during the difficult time like this pandemic.

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