Introduction
It often happens that a person has 2 properties/houses. One is where he lives with his family and another is vacant. If someone suggests renting the second house, he refuses to do so.
The landlord fears what if the tenant doesn’t pay rent, doesn’t vacate the property or damages it, etc. This is because there is a lack of proper central law on tenancy in India.
But now, the central government has framed a law on the subject of the tenancy. This has reduced much confusion between landlord and tenant and protects their interests. Let’s learn more about it.
Reasons for a new centralized law
The independent Indian government enacted the Rent Control Act, of 1948 in favor of tenants. That’s why many people avoid renting their property. Model Rent Legislation, 1992 was regarding the valuation of property rented. It sought to increase the rent due to inflation.
Further, the tenancy is a matter of the state list. Different states have the authority to decide their respective tenancy laws. But it also did not enhance the situation. There are so many disputes pending in the courts regarding tenancy.
They are vague and people misinterpret them many times. There is no clarity regarding the rent agreement. The laws don’t mention modern dispute resolution techniques, they rather depend on the courts to decide disputes. Matters remain pending for years due to a lack of clarity.
Hence, the government drafted Model Tenancy Laws. It asked states to follow the same and update their laws.
Provisions
Prospective in nature
The Act applies to a tenancy that takes place after the enactment of this Act. It does not affect any tenancy or landlord-tenant relationship which existed before this Act.
Applicability
The scope of the Act means its extent, as to what all it will cover. The Act applies to commercial and residential properties. If you rent the property for living or for setting up a shop, the Act will apply. It does not apply to hotels, dharmshala, or industrial properties. It also leaves out pending tenancy disputes.
Written Agreement
If a landlord rents his property, the tenant and landlord must write and sign the tenancy agreement. The agreement must specify:
- Details of rented property
- Rent payable
- Time duration of the tenancy
- Security deposit
- Rights and duties of landlord and tenant
Submit the agreement to the rent authority
Landlords should inform the Rent Authority of their area within 2 months of drafting the agreement. The rent authority will upload it on its website. It will work as strong evidence in case of any dispute.
Dispute resolution mechanism
The Act introduced alternative mechanisms for dispute resolution between landlord and tenant. Of course, if there is an agreement between parties, there will be less chance of dispute. Even if a dispute arises, the Act provides a 60 day alternative mechanism to resolve it.
It established a quasi-judicial mechanism, where civil courts would not have jurisdiction over such matters. The state government has to establish Rent Tribunals in each district after consulting the High Court.
Advantage to landlord
Rent payment
Now the landlord doesn’t have to worry about the payment of rent. If the tenant doesn’t pay the rent, the landlord can ask for double the value of the rent as a penalty.
Eviction
Similarly, if the tenant
- doesn’t pay rent for 2 months
- refuses to pay rent
- misuses possession
- changes structure of premises without permission
then the landlord can ask the tenant to vacate the premises. He has to apply to the Rent Authority, which will order tenants to evict the premises.
Sub-letting
Generally, a tenant further rents the property to another person through supplementary agreement. This is sub-letting. The new Act prohibits sub-letting.
Advantage to tenant
Security deposit
The tenant has to give some amount in advance to the landlord, called security deposit. It was not clear as to how much a tenant should pay as security deposit. The Act has clarified it. It depends on the type of property:
Residential property
- security deposit of 2 months
Commercial property
- security deposit of 6 months
Landlord enters the rented premises
A landlord cannot enter into the rented premises without the tenant’s permission. The tenant possesses the property, so the landlord requires his permission. The landlord has to give prior notice to the tenant that he will visit the premises.
Increasing rent
Now, the landlord cannot increase the rent all of a sudden. He has to give a 3 month prior notice to the tenant and write down the increased amount.
Structural changes to the property
A property requires certain maintenance and changes so that people can continue to live there. Such changes include painting, repairing pipelines, structuring walls etc. It is the responsibility of the landlord to make these structural changes and rent the property in good condition. The tenant can only look over minor changes like changing tube lights, fans, mattresses, etc.
Conclusion
Lawlessness cannot be a tool to evade responsibility. Rather, we should make an effort to ask the government to make laws on untouched matters. The tenancy was one such area. Uncertain laws make it difficult to carry out activities. But making a law is not the solution. People need to follow it for smooth transactions and to avoid disputes.
If still doubts persist, consult legal experts at
