Introduction: Rent Agreement

Renting process of a property can be challenging for first-timers. This is particularly true if you are in the process of investing in the rent of the movable property. You might be wondering what are the terms and conditions of a rental agreement. In this blog, I will provide you with a step-by-step guide on how to rent immovable property, particularly house property. I will also provide you with an overview of how the agreement process works.

Fixation of rent is a major disincentive for those who are in rental housing as it gives a very low rate of return.

What is a Rental Agreement?

A rental agreement is a contract that is drawn up between a landlord and a tenant, where the landlord agrees to rent a certain amount of space to the tenant for a certain period of time. The landlord is the person who owns the property, and the tenant is the person who rents the property. The agreement gives the tenant certain rights and responsibilities, and the tenant agrees to pay the landlord certain amounts of money. A rental agreement is also known as a lease.

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Rent Agreement Mandatory or not 

In India, as per the Registration Act, of 1908, the Registration of a lease agreement is mandatory, however, the rent agreement most of the time in a general scenario remains for a period of 11 months to avoid the parties from registration duties and registration fees. 

Up to 11 months’ Rent agreements known as leave and license agreements. And Agreements for 12 months or more are known as Lease agreements wherein stamp duty and registration fees are mandatory.

What Are The Terms And Conditions Of A Rental Agreement?

The rental agreement is a contract between the landlord and the tenant. The contract outlines the conditions of the rental agreement and the rights and responsibilities of both parties involved. Most rental agreements will have the following terms: The terms and conditions of a rental agreement are determined by the landlord and tenant. The landlord sets the terms and conditions of the agreement, and the tenant will have to agree to the terms in order to sign the agreement. The terms and conditions of a rental agreement may include the following: A rental agreement may include a wide range of terms and conditions, such as whether the tenant is required to pay a security deposit, the length of the rental agreement, the amount of the rent, the amount of the security deposit, the terms of the lease, and the terms and conditions of the lease.

How Does The Agreement Process Work?

The agreement process begins by filling out the application form. The applicant must provide the following information:- Name and address of the tenant -Rent amount - The reason for the agreement - Date the agreement will start - The length of the agreement - Type of agreement - The number of people who will be living in the property - The type of property - The number of pets allowed - The name of the landlord - The name of the tenant - The address of the property - The address of the tenant - The contact information of the landlord - The contact information of the tenant - The contact information of the tenant's representative - The contact information of the landlord's representative - The contact information of the tenant's representative - The contact information of the landlord's representative's representative - The contact information of the tenant's representative's representative - The contact information of the landlord's representative's representative - The contact information of the tenant's representative's representative - The contact information of the landlord's representative's representative - The contact information of the

What is Delhi Rent Control Act 1958

The Delhi Rent Control act makes the provision for the tenant against the landlord's misbehavior and illegal eviction, high unauthorized rent by the Landlord, etc.

As per the rule, the landlord can make an increment in the rent after the period of three years and that must not exceed ten percent of the rent being charged by the landlord, and the landlord cannot make illegal eviction of the tenant if rent is being timely paid. The landlord can increase the rent by 7.5% if the renovation is made in the rented house. Additionally, the landlord has to give advance notice to the tenant if there is an increase in rent. The landlord has the option to reach out to the Controller if the tenant makes breaches the agreed terms and does not abide by the landlord. A landlord may not receive or claim any payment for subletting all or part of a tenant's property.

A standard rent cannot be increased if no construction or renovation has occurred.

The provisions of the Act do not imply government building or local authority. Furthermore, no religious or educational institutions are covered.

If the date is not specified in the lease, a tenant may pay the rent to the landlord by the 15th of each month.

According to the Registration Act of 1908, both the tenant and the landlord must present a copy of the rent agreement.

The tenancy right can be passed to a successor of the deceased person for a period of five years. The successor can be a spouse, son or daughter, parents, or daughter-in-law. However, at the time of the tenant's death, the successor should have been living as a dependent on him. A successor has no tenancy right if he or she is not dependent on the deceased person.

Furthermore, if the successor already owns a home, the tenancy is not inherited.

The following are the grounds for eviction

The tenant would have to evict the property if he or she makes a breach of the lease agreement, or damaging the rented property, indulge in illegal or authorized activity on the property, nonpayment of rent, or For more than six months, a tenant or members of his family have not lived on the property, or even after the expiry the tenant has not left out the property, or the property has become unfit for human habitation, and it needs to be repaired. Under all these circumstances the tenant must vacate the premises.

Amendments under the Delhi Rent Control act

The Delhi Rent Control Act of 1958 has been amended and revised several times since it came into force in 1958. The first amendment to the Delhi Rent Control Act was made in 1988, stating that premises with rents less than Rs 3,500 would not be subject to the Delhi Rent Control Act of 1958.

New amendments were made, and new laws were formulated; the Act is now known as the Delhi Rent Control Act 2020 as per the Centre-enacted Model tenancy act, 2019, wherein the creation and registration of rent agreements have been made mandatory by the Act, and rights of landlord have been kept in mind along with tenants. The first copy of the contract would be given to the tenant, and the second copy would be filed with the rent control authority. If there is a lapse in the agreement, it will be renewed every month.

The Model Tenancy Act

The Model Tenancy Act bridges the gap between landlord and tenant.  Because the land of Delhi is a central subject, the Union Government must enact this Act. This new Act will have little impact on the old law, but it will have its own rent authorities, court, and bench. The rent will be agreed upon in writing between the landlord and the tenant.

According to a new provision in the Model Tenant Act, the security deposit to be paid to the landlord shall not exceed the rent of two months for the rental residential house and 6 months for non-residential houses, the landlord shall understand no circumstances stop the supplies of electricity, water, and other essential services if a tenant is unable to pay the rent after the tenancy period has expired, the landlord is entitled to compensation of double of actual rent for two months thereafter penalties shall be 4 times of actual rent.

Procedure 

Whenever a tenant enters into an agreement with the Landlord, the following steps need to follow to make the agreement legally binding:

• For the rent registration, the tenant must mutually comply with the terms of each other. 
• The agreed terms and conditions have to be written down including all the details of the agreement made between them such as Rent tenure, rent amount, maintenance charge, add-on, etc. 
• Subsequent put down all the terms and conditions attached with Samp Paper as per the value of the total rent amount in a documentary form. 
• Stamping: Make sure that the agreement is made on Stamp paper, and the stamp duty is complying with the requirements.
• Witnesses: keeping a witness ensures the liability of the parties and prevents them from claiming that they had not expected the document, in the rent agreement is required. The parties need to sign the agreement along with two witnesses and register the need at the registrar's office.
• Notarization: the notarization makes the agreement binding, it is in addition to the attestation of the Witness, the rent agreement notarization is not mandatory in India.
• Registration: the registration makes the rights and obligations of the parties effective in a legal sense, this is done before the Registrar.

The Following Documents Are Required For The Registration Of A Rent Agreement:

• Original or a copy of the title deed is required as proof of ownership.
• Address proof for both parties It could be a photocopy of one's passport, Aadhaar card, or driving license, for example. Keep the original ID cards on hand for verification.
• Two passport-sized photographs of the landlord and tenant.
• A copy of a PAN card or Aadhaar card is acceptable as identification.
• The rental agreement was printed on stamp paper.

Penalties

The disputes between tenant and landlord shall be heard by Rent Authority & court which will be headed by the District Magistrate and the District Judge or ADJ shall preside over a Rent tribunal for the district.

Anyone who violates the rules of the Delhi Rent Control Act 1958 faces the following penalties:

Inheritability of tenancy, if a tenant violates this provision, he will be fined Rs 1000 or imprisoned for three months, or both.

If a person was not dependent on the deceased person and still decides to stay at the premises, he or she will face 6 months in prison or an Rs 5000 fine, or both.

If a landlord is unable to keep the premises in good condition, repairs are not completed on time, and the amount recovered for maintenance is greater than 7.5 percent, the landlord will be punished. A 6-month prison sentence or a fine; or

Conclusion

For Rent Agreement Procedure there are several things that you need to keep in mind while signing a rent agreement. -The rent should be reasonable -The rent should be regular and fixed -The rent cannot be increased without the tenant's consent -The tenant should have a written agreement