Rent Agreements are the legal understanding between the owner of a land and its tenant. It falls within the gambit of residential or commercial property laws of India. When it pertains to establishing an occupancy, a lease arrangement is the most important legal file. To make a rent arrangement valid under Indian laws, signature by both the parties, i.e., the property manager and renter is a must. An ideal offline or online lease contract format should contain all the information and terms and conditions of the specific tenancy. These days, it is extremely easy to access online lease contract drafts in India. However, you always need to make sure that all the stipulations and regards to the lease agreement operate in favor of both celebrations. Through this short article, you can comprehend all the fundamental terms that a legitimate registered rent agreement must have and the different kinds of rental agreements in India.

As stated above, a contract gotten ready for the function of facilitating a tenancy is a rental arrangement. Generally, it is the property manager who gets the lease arrangement draft and then offers it to the renter for evaluation and signature procedure. However, the terms are not always just in accordance with the property owner's interest. A rent arrangement format is only valid when there is shared authorization of both celebrations on all the terms and stipulations. Further, the celebrations can likewise mutually make changes to any rental contract.

Rent agreement provisions

It does not matter if you are a property manager or the renter, it is equally essential for both celebrations to the rent arrangement to have a clear understanding of the stipulations and terms embeded in the agreement. The factor behind this is the truth that any uncertainty in the lease contract draft can end up being disastrous in case of any future issues. Now that we understand precisely what a lease arrangement is, we will discuss the most standard and essential provisions of a rent agreement.

Details of the parties

The most fundamental requirement of a valid rent arrangement is the details of both the parties, i.e., resident and property manager. Further, the occupant likewise needs to guarantee that they offer the specific name and number of the other occupants with him, as a part of that specific occupancy. The information include the name, permanent address, age, and occupation/profession of the parties.

Description of the rental residential or commercial property

The rental residential or commercial property does not need to always be a housing residential or commercial property. Hence, whenever you participate in a rental agreement, the arrangement should have a total description of the residential or commercial property in concern. Together with its address, the list of other features and assets of the residential or commercial property, such as television lights, fans, A/C, list of any other furniture, etc must belong of the rental contract. This assists prevent future clashes worrying assets of the residential or commercial property.

Regard to occupancy

In all legal agreements, this is among the a lot of standard terms. In a lease arrangement, the termination clause will specify the period of the tenancy. It will also provide out the terms for renewal of the lease agreement format between the parties.

Rent and deposit

The most crucial factor of any occupancy is the lease and the deposit quantity. Hence, it should be discussed in the draft of the rent contract. It makes sure that both the parties are available for the costs involved. Further, ideal rent and deposit provisions will likewise consist of the consequences of failure to payment of any quantity in due time by both parties.

Maintenance and damages to residential or commercial property of rent agreement

All terms connected to the upkeep and the cost and liability in case of damages to the residential or commercial property should belong of the offline or online rent arrangement.

Rules of the tenancy

This provision has one of the most effect on the tenant. In this stipulation, all the rules of the residential or commercial property should be discussed, such as:

- Whether pets are allowed or not;
- No. of occupants enabled;
- Whether the proprietor permits commercial transactions through their residential or commercial property or not; and so on.

Apart from these guidelines, the repercussions of not following them are likewise a part of this clause. These repercussions might consist of monetary charges or may even result in the termination of the contract.

Lock-in duration of lease contract

This is a provision that locks both parties to the contract for a particular period after its execution. Since renting a residential or commercial property is a difficult task, the lock-in duration typically protects the interest of both parties. The general lock-in period in all online lease contracts is 3 months. This assists both parties in settling.

Termination and notification of termination

Even after completion of the lock-in duration, no rental contract can be ended quickly. Hence, this clause is put in place. When either party does anything to breach the agreement, they can terminate the arrangement based upon the regards to this stipulation. The notification period for a rent agreement may last from one month to three months, depending on the shared decision of the parties.

Police verification of occupant

This stipulation safeguards the interests of the landlord. All tenants should get a police confirmation before executing the lease agreement. This guarantees the credibility of the renter and assists in building trust in between the company and worker.

Types of lease arrangements

When you believe of kinds of rent agreements, the many basic are house rent arrangements and commercial lease deeds. However, even these fall under the following 2 subcategories of lease arrangements in India:

- Lease Agreement: the minimum period of a lease agreement or a lease deed is 12 months. People typically decide for commercial lease deed drafts in India. Especially because the longer period of the lease makes it easier for entrepreneur. With that said, these lease agreements are governed by each state separately based upon their Rent control laws. Lastly, a fascinating aspect is that the lease contract generally also moves the interest in the residential or commercial property to the tenant.
- Leave and License Agreement: typically, a leave and license arrangement exists for 11 months. This is the major difference between both agreements. As a result, the leave and license contracts are majorly used for your home lease contract format. Lastly, the leave and license agreement is not governed by the rent control laws of various states.

How to carry out a rent arrangement in India?

The requirements for executing a rent agreement in India depend upon the duration of your rental contract. Based on the duration of your arrangement, you can figure out whether it needs registration or not. According to the Registration Act 1908, it is not compulsory to sign up a lease agreement, if the period is for less than 12 months. If your home rent agreement remains in a leave and license format, you will not require registration to perform it.

- When Registration is not necessary

In this scenario, as soon as the lease arrangement is prepared, all you need to do is, print it on stamp paper (as suitable to mark task). Then, get a signature of both parties and two witnesses.

- When Registration is mandatory

In this situation, the parties require to sign the appropriately notarised rent contract on the stamp paper before the registrar. This procedure too, needs 2 witness signatures. Below is the list of documents needed for registering a rental contract:

1. Proof of ownership of the residential or commercial property;
2. Tax Receipt;
3. Passport-sized images of both celebrations & witnesses;
4. Address evidence; and
5. Route map of the residential or commercial property.

You can find numerous rental contract drafts online. However, the most crucial aspect of any legal arrangement is your specific requirement. Experts at LegalWiz.in will ensure that all your rights are protected at all costs. Get on a call with our experts today. Contact us now!

Frequently Asked Questions

No, it is not necessary to sign up rental arrangements in India. The compulsion depends upon the period of your rental agreement.

This is something that both parties can choose equally. However, for the most part, the renter pays associated with rental agreement registration.