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 concerns developing an occupancy, a lease contract is the most essential legal file. To make a rent contract valid under Indian laws, signature by both the parties, i.e., the property owner and renter is a must. An ideal offline or online lease contract format need to contain all the information and terms and conditions of the particular tenancy. Nowadays, it is really easy to access online lease contract drafts in India. However, you constantly need to make sure that all the provisions and terms of the lease agreement operate in favor of both parties. Through this post, you can understand all the standard terms that a legitimate registered lease agreement should have and the various kinds of rental arrangements in India.

As mentioned above, an agreement gotten ready for the function of helping with a tenancy is a rental agreement. Generally, it is the landlord who gets the rent contract draft and then provides it to the tenant for evaluation and signature procedure. However, the terms are not always just in accordance with the landlord's interest. A lease agreement format is just valid when there is shared approval of both parties on all the terms and stipulations. Further, the celebrations can likewise mutually make amendments to any rental contract.

Rent contract provisions

It doesn't matter if you are a proprietor or the occupant, it is equally important for both celebrations to the lease contract to have a clear understanding of the stipulations and terms embeded in the contract. The factor behind this is the reality that any uncertainty in the rent contract draft can turn out to be devastating in case of any future concerns. Now that we understand exactly what a rent contract is, we will talk about one of the most basic and essential stipulations of a rent arrangement.

Details of the parties

The most fundamental requirement of a valid lease agreement is the details of both the celebrations, i.e., occupant and property owner. Further, the occupant also needs to guarantee that they offer the exact name and number of the other occupants with him, as a part of that particular occupancy. The details consist of 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 constantly be a housing residential or commercial property. Hence, whenever you enter into a rental contract, the contract should have a total description of the residential or commercial property in question. Along with its address, the list of other features and properties 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 concerning possessions of the residential or commercial property.

Term of occupancy

In all legal contracts, this is one of the many standard terms. In a lease contract, the termination clause will specify the period of the occupancy. It will also give out the terms for renewal of the lease contract format in between the parties.

Rent and deposit

The most important aspect of any tenancy is the lease and the deposit amount. Hence, it needs to be pointed out in the draft of the lease contract. It guarantees that both the celebrations are available for the expenses involved. Further, ideal rent and deposit clauses will also include the consequences of failure to payment of any amount in due time by both parties.

Maintenance and damages to residential or commercial property of rent arrangement

All terms related to the upkeep and the cost and liability in case of damages to the residential or commercial property must belong of the offline or online lease contract.

Rules of the tenancy

This clause has one of the most effect on the occupant. In this stipulation, all the guidelines of the residential or commercial property should be mentioned, such as:

- Whether family pets are enabled or not;
- No. of occupants allowed;
- Whether the property manager allows industrial deals through their residential or commercial property or not; and so on.

Apart from these guidelines, the consequences of not following them are likewise a part of this clause. These effects may include financial charges or may even lead to the termination of the agreement.

Lock-in duration of rent arrangement

This is a stipulation that locks both celebrations to the agreement for a certain period after its execution. Since renting a residential or commercial property is an uphill struggle, the lock-in duration typically protects the interest of both celebrations. The general lock-in period in all online rent contracts is 3 months. This helps both celebrations in settling.

Termination and notice of termination

Even after the end of the lock-in duration, no rental arrangement can be ended abruptly. Hence, this stipulation is put in place. When either party does anything to breach the contract, they can end the agreement based on the regards to this stipulation. The notice period for a lease agreement may last from one month to 3 months, depending upon the mutual decision of the celebrations.

Police verification of occupant

This stipulation safeguards the interests of the proprietor. All renters must get a cops confirmation before executing the lease arrangement. This makes sure the reliability of the tenant and helps in constructing trust between the employer and staff member.

Types of rent contracts

When you believe of types of rent contracts, one of the most standard are house rent agreements and industrial lease deeds. However, even these fall under the following 2 subcategories of rent arrangements in India:

- Lease Agreement: the minimum duration of a lease contract or a lease deed is 12 months. People typically choose for commercial lease deed drafts in India. Especially since the longer period of the lease makes it much easier for company owner. With that said, these lease contracts are governed by each state individually based upon their Rent control laws. Lastly, an intriguing aspect is that the lease contract typically likewise moves the interest in the residential or commercial property to the occupant.
- Leave and License Agreement: normally, a leave and license agreement exists for 11 months. This is the major distinction in between both contracts. As a result, the leave and license contracts are majorly used for your home lease contract format. Lastly, the leave and license contract is not governed by the rent control laws of various states.

How to carry out a lease agreement in India?

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

- When Registration is not obligatory

In this scenario, when the lease contract is drafted, all you require to do is, print it on stamp paper (as appropriate to stamp duty). Then, get a signature of both celebrations and 2 witnesses.

- When Registration is obligatory

In this scenario, the parties require to sign the properly notarised rent agreement on the stamp paper before the registrar. This process too, requires 2 witness signatures. Below is the list of files required for signing up a rental agreement:

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

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

Frequently Asked Questions

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

This is something that both parties can decide mutually. However, in many cases, the tenant bears the costs related to rental arrangement registration.