Amid the raging second wave of the COVID-19 pandemic in India, migrant workers may once again find themselves being forced out of urban centres in India. With job loss and pay cuts, because of the economic crisis from the resurgence of more fatal variants of the Coronavirus, the focus is again on tenants, who may not be able to pay their monthly rentals.https://fea0ec37ee2f1a2f607399a9ac9ddd39.safeframe.googlesyndication.com/safeframe/1-0-38/html/container.html
Even though the government agencies and global think-tanks continue to maintain that the economic impact of the COVID-19 second wave, would not be as adverse as seen during the first wave when millions of workers lost their incomes following a strict nationwide lockdown, numbers present a bleak picture.
According to the Centre for Monitoring Indian Economy (CMIE), the second wave of COVID-19 and the fragmented lockdowns have impacted over 75 lakh jobs, taking the unemployment rate to a four-month high of 8%, in April 2021.
Since the actual numbers might be much higher, considering the data does not include jobs in the unorganised sector, it may be safe to assume that a large number of people, who returned to cities after the first wave was over and businesses started to resume normalcy, are running the risk of non-payment of their monthly rents.
Unlike the first wave, when various states issued directives to landlords to not force their tenants to pay rents amid the economic crisis, no such advisory has been issued by any state so far, including those which are home to some of the biggest job markets in the country – Maharashtra, Delhi and Karnataka.
Rent payments may be a bigger burden for tenants who are also paying monthly EMIs against housing loans for their under-construction properties. Unlike last time when it offered a six-month relief to home loan borrowers, the RBI has not announced any home loan moratorium scheme. In the view of the banking regulator, businesses in India are better prepared to deal with the economic impact of the second wave of the pandemic and the RBI would continue to assess how the situation evolves, before announcing another moratorium scheme.
See also: Impact of Coronavirus on Indian real estate
Tenants who availed of the moratorium and/or the loan restructuring schemes last time, may be under greater monetary pressure now, than they were during the 2020 lockdown. This brings us to the question: What can a landlord do in case you are not able to pay your monthly rent, because of a job loss?
Can a landlord evict a tenant?
Under the provisions of the Draft Model Tenancy law in India, landlords could initiate an eviction process, if the tenants fail to pay the rent for two months in a row. So, unless states start issuing directives to landlords in this regard, the landlords would be well within their legal rights, to ask their tenants to move out.
“Not only can the landlord ask you to move out of their premises, he would also be allowed to keep a large part of the security deposit, to claim any unpaid rent,” says Prabhanshu Kishra, a Lucknow-based lawyer.
