Rent Agreement in Delhi

Who is Responsible for the Registration of the Rental Agreement in Delhi? Tenant or Owner?

This is the starting point of all the disputes between a tenant and an owner. The tenant might see the rental agreement as the responsibility of a tenant since he receives an address proof on the registration of the rental agreement. On the other hand, the tenant might see it as the responsibility of the owner, since most of the rights are enjoyed by the landlord.
So, the question is—Who should take the initiative for the registration of the rental agreement in Delhi?
Actually, it is the responsibility of both—the tenant and the owner to get done with the registration process and Delhi and even in other parts of the country. The registration cost and the stamp duty price have to be shared equally among all the parties.
However, if we go by the law, it is the landlord that may have to face the consequences if he does not have a registered rental agreement. According to the Delhi Rental Act Control, a landlord is subject to a penalty of Rs. 5000 or imprisonment of three months, if his property is given on rent without any legal procedure or registration.

What is the Key Right/Benefit that an Owner Enjoys on the Registration of the Rental Agreement in Delhi?

When a property has proper documentation of ownership and a rental agreement with the tenant, the owner can get assurance regarding his possession of the property. The tenant cannot claim any right on the property than the one he enjoys during the lock-in period. A tenant cannot rent the property to other individuals and can’t carry out any other activity than that included in the rental agreement.
For example, if a tenant has rented the property for residential purposes, he cannot make it a commercial hub and make an earning out of it. In cases the tenant illegally tries to take possession of the property, the law comes to the rescue of the owner, when he presents the rental agreement as evidence of the terms and conditions, along with the lock-in period.

What is the Key Right/Benefit that a Tenant Enjoys on the Registration of the Rental Agreement in Delhi?

When a tenant rents a property, he pays a lump sum amount of security deposit, which is usually equal to the period of three months of rent or less. In the absence of the rental agreement, the owner can take charge of the security deposit, even after the tenant lawfully serves the notice period. A registered rental agreement empowers the tenant and offers him the right to receive the security deposit after he vacated the rental property, as per the pre-determined nature of the termination.
Besides this, during the lock-in period, the owner cannot evict the tenant without any prior intimation. The owner has to give a notice of at least a month or 30 days for the tenant to prepare for the eviction.

What Does an Ideal Rental Agreement Include?

You can enlist a number of clauses to avoid any type of conflict. However, there are certain clauses which you should not miss out on while drafting your rental agreement.
An ideal rental agreement is one that includes the following pointers:

• The ownership agreement is properly documented, and a copy of the same is attached during the registration of the rental property
• The contract period should be stated in the rental agreement. If the rental period is less than a year, the notarized rental agreement can do. However, if the same exceeds a period of about a year, the rental agreement needs to be registered.
• The rental agreement should include the terms and conditions that apply to both the parties—the tenant and the owner. These are very sensitive points of discussion, and hence, you need to make sure that you come to agreeable terms, before drafting the rental agreement. In case of any dispute, the legal proceedings will be heard based on the terms and conditions mentioned in the registered rental agreement.
• The owner should make a list of all the facilities, utilities, and appliances that he offers to the tenant to use, before renting the flat. The rental document should include this list. Also, a clause should talk about the repair and maintenance of these utilities. For example, after a couple of months, the geyser needs repairing. In such a case, the tenant needs to discuss the issue with the owner. The rental agreement must also clearly state the responsibility of payment for repair and maintenance.
• Information about the total amount of rent and deposit has to be mentioned in the rental agreement. Besides this, the rental agreement must include scenarios wherein the owner can terminate the contract and withhold the security deposit.
• The rental agreement must talk about the restrictions that the owner may impose on the tenant. For example, the owner may have concerns with the food choices of the tenant and the guests of the opposite gender coming to the rental property, in case the tenant is a bachelor.
• The rental agreement should include the purpose of the rental. If the tenant has rented the property as a commercial space for a particular business, he cannot use the same property to rent it to other person or use it for another purpose, without getting the written approval of the owner.

What Type of Agreement should you Opt for?

There are different types of agreements. However, each of these has a different purpose. For instance, you cannot register your shop under a rental agreement. You need to register your rented shop under the commercial rental agreement. Below are some of the types of agreements, along with their definition and purpose:

• Rental Agreement:
  The rental agreement is commonly used when a tenant and a homeowner decides to enter into an arrangement for renting a residential property. The purpose of the rental agreement is to form a conducive environment with security assurance from the lawsuit.
  The tenant has to pay a security deposit, which is refundable in most of the cases. Besides this, the tenant has to pay the monthly rent to the owner. The tenure of the rental agreement can be up to 11 months or even more.
• Lease Agreement:
  A lease agreement is formed between two parties when they want to rent the property for a particular number of years. As opposed to the rental agreement, the lease agreement has to be for at least a period of one year. The tenant does not have to pay the monthly rent or security deposit.
  Before leasing the property, the tenant pays a lump sum amount to the owner. The owner puts this sum in a bank account and earns it in the form of interest. When the tenant vacates the rental property, the property owner releases the lease amount.
• Commercial Rental Agreement:
  A commercial rental agreement is created when the tenant uses the rental property to carry out some kind of business from the rental property. The tenant; however, cannot rent the property to another individual or business.
  If a tenant is entering into a rental agreement for the commercial space, he needs to pay the security deposit before renting the property. In addition, he needs to pay the monthly rent.
  If a tenant is entering into a lease agreement for the commercial space, he needs to pay the lease amount before renting the property. When the agreement expires, the tenant is eligible for receiving the lease amount without any interest.

What Should be your Approach of Registration of a Rental Agreement in Delhi?

Once you know what should be the form of the agreement, you need to gather all the required documents from your tenant/owner. If the rental property is owned by multiple individuals, the rental agreement has to include the names and details of all the owners.
Similarly, when there is more than one tenant, the rental document must include the details of all the tenants. This is because the terms and conditions mentioned in the rental agreement have to be applied to all the tenants. During the registration of the rental agreement, the presence of all the property owners and tenants is necessary. They need to be present with the required documents—an Aadhaar card, passport-size photographs, Pan card, property tax details, etc.
Having an online registration approach works best for the rental agreement in Delhi. The online portal offers you the convenience to register the information about your rental property without having to step out of your home or avail leave from work. However, you will need to schedule an appointment with the local police for tenant verification. Besides police verification, there is biometric verification that needs to be booked.
Handling the entire legal procedures on your own can be a big task. If you need a bit of ease with the registration of your rental agreement, we are just a call away