Understanding the Duration of Agreement for Birla Advaya
Agreement period, is the period during which the buyer and the developer are bound by law to adhere to the terms mentioned in the agreement. This period is quite important as it contains some very important milestones, project completion, handing over, and post-occupancy obligations among others.
Key Elements of the Agreement Duration
The tenor of any agreement for any property in India, like Birla Advaya, is generally governed by various factors:
1. Project Construction Timeline
• The term generally runs from the date when the agreement is signed up to the possession date.
• Normally, the construction times for large projects, such as Birla Advaya, will range between 3 to 5 years depending on the stage of the project and whatever unexpected delays that may occur.
2. Grace Period Clause
• Developers provide a grace period of usually 6 to 12 months to cater for some delay in the construction process due to external factors such as weather or regulatory problems.
3. Possession and Warranty Period
• Following possession, a DLP of 1–5 years is usually granted. Such a period is essential because buyers will have the opportunity to report on defects in the construction, which the developer must address.
• For Birla Advaya, a DLP would typically be at around 2–3 years.
4. Agreement Validity and Renewal
Agreements sometimes also provide for the duration of their valid period. Even after handing over possession, after-sales service agreements regarding maintenance between the developer and the management/owners association could range anywhere from 1–3 years.
Legal Framework Governing Agreement Durations
Indian real estate agreements, including project agreements for the Birla Advaya project, are primarily governed by the RERA Act, 2016. The act requires transparency and accountability, notably for three very important reasons regarding the following:
Defined Timelines:
In the agreement, project developers must define timelines toward project completions and possession.
Defined timelines within a real estate agreement guarantee that developers commit to clear dates for project completion and possession, the hallmarks of transparency and accountability. Specifying these milestones in the contract brings confidence to the delivery schedule, with which the buyers can plan their finances and moving plans. It also provides legal action in case there are delays. This clause will further highlight the professionalism and commitment of the developer in adhering to the agreed-upon time frame, giving rise to trust and reliability in the transaction.
Penalties for Delays:
If a developer fails to meet the agreement time, he is bound to pay compensation to the buyer.
Unless agreed upon, the buyer or the developer usually loses his claim to pay compensation to the other if they fail to complete their project within the stipulated time. This penalty is usually indicated in the sale contract or in the construction contract and could be monetary remuneration for delayed occupation, which may include rental charges for the time the buyer cannot occupy the property, among other reimbursements for the inconveniences involved. In such cases, as per the Real Estate (Regulation and Development) Act or RERA, the developer may also return the amount or interest on money paid by the buyer when possession is not handed over within the date promised.
Force Majeure:
In an agreement, the contract may include a further extension of timeline in case of natural disasters.
Usually, the force majeure clauses in real estate contracts give an extension when, due to extraordinary events or circumstances, there is a prevention of performance by a party that should fulfill such an obligation within the stipulated timeline. Such events as, for instance, earthquakes and floods, among many other disaster occurrences that could hinder the procession of construction or delivery, fall beyond the parties' power. In such events, the party aggrieved is generally discharged from the penalties imposed for delay, and the timeline may go past the stipulated date without penalty, provided the event falls under the purview of the force majeure provision and has been communicated as required by the terms of the contract.
In conclusion, the duration of agreement for projects such as Birla Advaya is another significant factor in deciding the timeline from the time of signing the agreement to possession and beyond. It has construction timelines along with grace periods that apply in case of delays, and defect liability warranties beyond possession. Clear timelines by law under RERA Act with penalties and awards in case of delays are applicable.
Contact the Birla Advaya Professional Support Team for comprehensive details about this project
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Bengaluru, Karnataka
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