Rent Agreement – Overview

A rent agreement is a contract between the property owner and the renter who wishes to occupy the property for a temporary period. In India, rent agreements are typically made for 11 months, but they can be shorter than 11 months as well.

If the property is rented out for more than 12 months, then it is compulsory to register the rent agreement under The Registration Act 1908. Most of the rules related to renting and leasing are governed by The Registration Act 1908 and The Transfer of Property Act 1882.

A Rent Agreement/Lease Agreement Contains the Following:

• Details of the property owner and the renter, including ID proofs.
• Description and location of the property.
• Security deposit details, usually equal to the rent amount, paid before the renter takes possession of the property.
• The monthly rent to be paid by the renter.
• The duration of the rent, typically 11 months in India.
• Notice period, usually 2 months.
• Terms regarding entry by the property owner for inspection.
• Duties and liabilities of both the owner and the renter, including who will be responsible for repairs or damage during the renting period.
• Any additional terms and conditions set by the landlord.
• A sublease clause, if applicable, depending on the agreement between the landlord and the renter. This clause allows the renter to sublet the property to someone else if the landlord permits it.

Pre-Requisites of Drafting and Registering a Rent Agreement/Lease Agreement:

• A qualified lawyer.
• The terms and conditions set by the property owner should be discussed and agreed upon by the renter.
• ID proof of both the renter and the property owner (such as Aadhar Card, PAN card, etc.).
• One witness, along with their ID proof.
• For registration:
  • Two witnesses, along with their ID proofs.
  • Two passport-size photos of the renter and the owner.
  • Proof of property ownership.
  • Property documents such as a tax receipt, etc.
  • Route map of the property.

Procedure for Drafting a Rent Agreement/Lease Agreement:

1. Contact a qualified lawyer to discuss the need for drafting a rent or lease agreement.
2. The lawyer will draft the agreement based on your requirements.
3. The property owner (lessor) and the renter (lessee) must sign the document.
4. The witness should also sign the document.
5. The lawyer will review the agreement and give the final approval that the document is complete.

For Registration:

1. Visit the sub-registrar office.
2. Pay the stamp duty and registration fee, which may be divided between the renter and the owner.
3. Produce all the required documents.
4. Both parties will sign in the presence of the sub-registrar.
5. The two witnesses will also sign the document.
6. The rent agreement is registered, and both parties will receive a copy of the registered rent/lease agreement.