All You Require To Think About Rent Agreement

All You Require To Think About Rent Agreement

Since home proprietorship may some of the time be difficult to arrange or unreasonably expensive. A larger part of the moving working populace in India’s significant urban areas live in rented houses. For this, the inhabitant consents to a rent agreement with the house owner, which incorporates the terms and conditions that will be authoritative for both the inhabitant and the house owner.

Draft Model Tenure Act

To advance rental lodging in India, the government authority has defined a rental draft, the Draft Model Tenancy Act, 2020, to make the exchange gainful for both, property owners and inhabitants. The arrangements laid under this model approach, are guiding core principles while drafting a rent understanding and agreement. As per govt secretary for union housing, the policy, which is probably going to supplant the current laws on rental lodging across India soon, will open several crore units of rented houses in India’s rental lodging markets.

Rent Agreement: Legal Aspects, Agreement Formats, Registration Process

October 31, 2020, was the last date to propose any suggestion on this rental draft. The draft model tenure draft will be passed as an act by the law. A few regional government authorities have just begun the process to adopt this draft model act.

Legal Aspects Of The Rent Agreement

To save certain costs and time, occupants and property owners now and again agree about the tenure orally and try not to execute a rental agreement. A few may likewise draft the terms and conditions concerning the occupancy however choose not to register this agreement with the Govt authorities. This is on the grounds that both players will be mindful to pay a registration charge if a rent agreement is made and enlisted. The property owner will likewise be binding to report his rental pay when the rent understanding finds legal stature. Nonetheless, going into a rental arrangement without government registration is illicit and could end up being a dangerous business for both players, particularly in the event of a future conflict.

Until a rental arrangement is enlisted with the sub-registrar’s office, it has no legitimacy. It is in the safety of both the parties, to draft an agreement with explicit terms and conditions and to get it enlisted. Subsequent to drafting the rent arrangement, the house owner should print it on stamp paper. When the occupant and the landowner sign the agreement within the sight of two observers, they should enrol them at the sub-registrar’s office, after paying the necessary registration fees.

After the government set up rent experts in urban communities following the execution of the draft law, property managers and occupants would need to be available before the administration to get the rent agreement enlisted with them.

Rent Agreement Formats

Documents needed for rental agreement registration


  • Two passport-sized photos.
  • Aadhaar card.
  • Identity proof (Driving Licence, Voter Card, or Passport).


  • Two passport-sized photos.
  • Aadhaar card.
  • Voter ID card.
  • Passport for people from outside India.

Details To Be Included In The Rent Agreement

  • Main details required in a standard rental agreement are:
  • Names and address of both the parties.
  • Signatures of the tenant and the landlord.
  • Monthly rental amount.
  • Security deposit.
  • Maintenance charges.
  • Period of stay.
  • Responsibilities/rights of the landlord.
  • Responsibilities/rights of the tenant.

Stamp Duty On The Rental Agreement

You need to pay a stamp duty while enrolling rent agreement, which will differ, contingent upon the city where it is enlisted. This sum is paid, by buying the stamp paper of significant worth you owe to the government authority.  The stamp duties are payable in the range of 2% of the normal yearly rent, on account of rent arrangements for a term of as long as five years.

E-Stamping Of The Rental Agreement

In certain states, where the e-stamping facility for the rental agreement is accessible, you don’t need to truly purchase the stamp paper. You can sign on to the Stock Holding Corporation of India Ltd (SHCIL) site and check if the state where you dwell offers this option. By and by, Assam, Gujarat, Himachal Pradesh, Karnataka, Maharashtra, Delhi-NCR, Tamil Nadu, Uttarakhand, and Uttar Pradesh, permit e-stepping of rental agreements.

Rental Agreement: Terms And Conditions

For occupants

  • Security Deposit and token sum: The agreement should plainly make reference to the security deposit and what befalls it when you leave the premises. It ought to likewise make reference to the token sum that the landowner has gotten from you.
  • The number of tenants: The understanding should state what occurs if your family and relatives stay along with you in the future.
  • Fixes: The understanding should specify who will bear the expenses related to damages if any.
  • Upkeep: The understanding must plainly state who will be obligated to pay the month-to-month maintenance charges.
  • Guests: The arrangement should provide a provision for who can visit you and at what time.
  • Pet strategy: Do look at if your property owner will permit you to keep pets if you somehow happened to embrace one.

For Property Owners

  • Conditions to clear your property.
  • Visiting hours.
  • Harms to property and its outcomes on the inhabitant.
  • Rules on subletting.

Rent Increment Clause

Under the arrangements of the Draft Model Tenancy Act, 2019, property owners can’t actualize any increase in the pre-fixed rent for the whole period for which a rent understanding has been agreed upon. On the off chance that the rent understanding terminates following 11 months, for instance, the property owner can’t increase the month to month rent during this period. It is simply after this period and at the hour of the enlistment of the new rental agreement. The property owner is lawfully allowed to increase the rate, ordinarily not surpassing 10% of the current sum. Likewise, the property owner should give three months’ notification to the inhabitant, prior to increasing the rent as per the draft act.

Penalty Clause For Delay In Vacating The Property

The draft law additionally expresses that inhabitants expanding their stay in a rented convenience as referenced in the understanding will be obligated to pay twofold the rent sum for the initial two months and multiple times the rent in the resulting months.

Is It Obligatory To Register For A Rental Agreement?

Note here that notarised rent agreements are not equivalent to registered documents. If there should arise an occurrence of a dispute between the landowner and the occupant, the court won’t concede a notarised arrangement as evidence. Thus, it is essential to get the rent agreement properly registered.


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