Delhi rent act to be redrawn

Delhi/NCR
The Centre plans to go back to the drawing board for drafting a new Delhi rent bill. It will move ahead only after seeking fresh views from all stakeholders, including the members of Delhi assembly, which is currently under suspension. The union urban development ministry will take this stand before the Delhi high court in its reply to a pending petition filed by landlords challenging the constitutional validity of Delhi Rent Control Act.

“There is no proposal for notifying Delhi Rent Act 1995 under consideration of the ministry. To enact a new legislation, a bill to repeal Delhi Rent Act 1995 was introduced in Rajya Sabha and has not been taken up for consideration so far,” says a note prepared by the UD secretary.

Centre’s latest stand will come as a big blow to those landlords who draw a pittance as rent for properties worth crores in areas such as Connaught Place, Karol Bagh, Paharganj and the Walled City.

By deciding to hold a fresh round of consultations, the Centre has in effect indicated that it is in no rush to enact another 2013 bill, which was meant to phase out an amended 1995 bill. That bill was passed in Parliament and had received presidential assent to become an Act but was never notified.

Last month HC had asked the new government at the Centre to clarify its stand on implementation of the amended Delhi Rent Act 1995. The bench directed additional solicitor general Sanjay Jain to report to court the thinking of the central government on the issue before the final arguments are heard in the case on October 16, 2014.

The court is hearing a challenge to the constitutional validity of Delhi Rent Control Act by an association of landlords. One of them, petitioner advocate Shobha Aggarwal has argued that the Act violates Article 14, 19(1)(g) and 21 of the Constitution of India.

Aggarwal and her two sisters are fighting the case for years saying there are thousands of similarly placed landlords who can’t even earn their livelihood by renting out prime property due to the ceiling defined by the DRC Act.

Originally intended to protect the migrant population from arbitrary rent hikes by wealthy landlords, the Delhi Rent Control Act came under intense scrutiny when it was reduced to a tool to harass landlords. The petitioners have highlighted in high court how even as property values skyrocketed, landlords were forced into penury because they could neither evict tenants, nor increase rent.

While courts, led by Supreme Court, have often intervened in favour of landlords allowing them to invoke “need” as a legitimate ground for eviction, the DRC Act remains a big hindrance to aligning rents with market rates. As per the existing laws, those paying less than Rs 3500 per month as rent are protected under the Act.

Source: http://content.magicbricks.com/industry-news/delhi-ncr-real-estate-news/delhi-rent-act-to-be-redrawn/76483.html