Laws That Tenants and Landlord Must Be Aware Of

Many individuals still don't understand how to rent the property, what changes have been done, their advantages, or how crucial they are in this particular circumstance. What laws have been passed to resolve tenant-landlord disputes through the filing of civil lawsuits in the event of a breach or for registration?

While renting a property, a rental agreement is one of the most essential elements. A rental agreement is a contract that binds the tenant and the landlord. It describes every aspect of the agreement that the landlord and tenant have agreed upon. A written rental agreement must exist, and the tenant must receive a copy of it before the anticipated tenancy time. However, the Residential Tenancies Act of 1986 will apply if there is no formal agreement. The tenancy agreement must follow the legislation as written.

Both parties are granted rights under tenancy agreements, such as the tenant's ability to occupy the property and the landlord's right to collect rent. The tenant must study the lease carefully before signing it, and if they have any questions about the provisions, they must consult a lawyer. You can get in touch with the best lawyers in your area at Rest the case in just a click.

Laws Relating to Renting A Property

Following are some important laws that tenants and landlords must be aware of:

Rent Control Act, 1947:

This law was created in the year 1947 to safeguard tenants from landlord exploitation and regulate rent prices. Additionally, it gives landlords and tenants rights. They had to deal with major issues like stagnant rental housing investment, the removal of existing housing stock from the rental market, and stagnant municipal property tax revenue regardless of inflation. The central government published a modern rent control act proposal in 1992 to pass it into law in every state. However, the New Delhi rental control act was passed into law but failed for several reasons, including pushback from sitting tenants who are traders. The Maharashtra Rent Control Act, Delhi Rent Control Act, Tamil Nadu Rent Control Act, and Karnataka Rent Control Act are the only states that have passed laws containing procedures for resolving disputes between landlords and tenants.

• The purpose of the rent control regulations is to fix the standard rent and allow for annual rent increases. These are some of the key characteristics of this Act:
• To assist potential renters in finding a rental property that meets their expectations, the Act imposes several laws on the renting out of properties.
• Rents that are fair and uniform and below which tenants cannot be charged have been established.
• The Act also protects tenants from being evicted unfairly or with force by their landlords.
• The Act specifies in detail the duties and commitments that the landlord has to the tenants.
• The Act not only outlines the duty of the landlord but also their rights if a tenant fails to uphold their obligations at any moment.

Even though the Rent Act aims to safeguard both landlords' and tenants' interests at the same time, the following factors are exempt from its provisions:

• Any government or local authority-owned property.
• Any space rented or sublet to a bank, a public sector organization, a business, an international organization, a foreign mission, or a company with a paid-up capital of Rs. 1 crore or more.

Model Tenancy Act, 2020:

On June 2, 2021, the Model Tenancy Act, 2020 ("MTA") was adopted by the Union Cabinet. The MTA is the government's attempt to gradually move rental housing toward becoming a formal market to permit the institutionalization of the sector. The mission of the MTA is to close the gaps now present in the rental housing market, increase accountability and transparency, and strike a wise balance between the interests of both tenants and landlords. All the states and union territories have been advised to adopt them.

Need for Model Tenancy Act

• The rise of rental housing is being constrained by the current rent control rules, which also deter owners from renting out their vacant properties out of concern for eviction.
• Adding transparency and accountability to the current system of renting out properties and judiciously balancing the interests of both the property owner and tenant are two potential solutions to the unoccupied house problem.

Significance of Model Tenancy Act

• The authority will present a mechanism to promptly handle disputes and other pertinent matters.
• It will contribute to a nationwide revamp of the legal system governing rental housing.
• To overcome the severe housing shortage, it is anticipated to boost private investment in rental housing.

Transfer of Property Act, 1882:

Sections 105 to 117 refer to lease or rent under the Transfer of Property Act, 1882 (TOPA) of 1882. Illustration: Tenant B and landlord A. Only B is eligible to get A's possession. According to section 105, rent is defined as the price paid by the person who transfers the property (the lessor) to the lessee and accepts it (the lessee).

A lease must include each of the following:

The right to use the property,

• Acceptance
• Consideration
• Ownership
• Possession

Maharashtra Rent Control Act, 1999:

2020 saw the repeal of the Central Provinces and Berar Regulation of Letting of Accommodation Act 1946, the Hyderabad Houses Control Act 1954, and the Bombay Rents, Hotel, and Lodging House Rates Control 1947. The Bombay Presidency passed all of the Acts necessary to regulate Mumbai's rental sector. Mumbai's first rental-related law was passed in 1915, followed by another in 1939, and finally, in 1947, the Bombay Rents, Hotel, and Lodging House Rates Control Act, which replaced these two. And as of right now, the Maharashtra Rent Control Act 1999 is the only law. Any property owned by the government, a local authority, a bank, a PSU (public sector undertaking), or a state or center corporation is exempt from the provisions of the act. The landlord must maintain and make changes to the residential or commercial property by the Act.

According to the Act, all disputes involving tenancy must be heard promptly and without delay. Within a year after the case's filing, the court should attempt to resolve the matter.

Tamil Nadu Rent Control Act, 1960:

The purpose of the Tamil Nadu Rent Control Act, of 1960 is to regulate the tenancy of buildings by the terms and circumstances of the rental agreement signed by the landlord and the tenant, as well as to protect their interests in the event of a disagreement. All residency agreements must be in writing and must be registered with the Rent Authority by the Registration Act of 1908, according to the stipulations of this law. Due to the little interaction with the Rent Authority for most transactions, the registration portal is. The public can register a tenancy agreement more easily and conveniently thanks to the tenancy registration portal.

The Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013:

The Bill includes land acquisition, rehabilitation, and relocation as provisions. The Land Acquisition Act of 1894 is replaced by it.

Land purchase procedures include a Social Impact Assessment survey, preliminary notification of the desire to acquire, a declaration of acquisition, and payment of compensation by a specific deadline. All acquisitions need for providing rehabilitation and resettlement to the affected parties.

In cases involving rural areas and twice in cases involving urban areas, the compensation for the owners of the seized land shall be four times the market value.

If the land is purchased for private business or public-private partnerships, 80% of the displaced residents must agree. Private corporations will need to provide for restoration and resettlement if they purchase sizable parcels of land.

Acquisitions made according to 16 current laws, such as the Special Economic Zones Act of 2005, the Atomic Energy Act of 1962, the Railways Act of 1989, etc., shall not be subject to the terms of this bill.

Registration Act, 1908:

There are currently seven enactments with provisions connected to document registration. This will make it simpler to understand the legislation. When the Code of Civil Procedure, 1908, and the Indian Limitation Bill, currently before the Council, go into effect, it will further eliminate three full Acts from the Statute book and allow the removal of two other Acts in their entirety. The chance was taken to include formal changes that were only meant to enhance and simplify the text of the current Act. The Act of 1877's section numbers has been maintained. It has been discovered that the legislation may alter in some ways as a result of the consolidation process alone. A few changes seem to be required to prevent this.

Purpose of the Act:

The Registration Act was created, among other things, to provide a mechanism for publicly registering papers, informing the public about legal rights and obligations resulting from or affecting a specific property, preserving documents that may one day be important legally, and preventing fraud. Certain groups of papers gain importance and inviolability as a result of registration.

The Indian Contract Act of 1872:

All business transactions in India are governed by the Indian Contract Act of 1872, a thorough legal framework. The statute outlines the guidelines that must be followed while making a contract and offers remedies in the event of a breach. It is one of India's oldest acts and has undergone numerous revisions throughout the years to reflect shifting economic realities.

All contractual agreements in India are governed by the Indian Contract Act of 1872, which serves as a comprehensive manual. The statute outlines the guidelines that must be followed while making a contract and offers remedies in the event of a breach. It is one of India's oldest acts and has undergone numerous revisions throughout the years to reflect shifting social norms and technical development.

The British government passed the law in 1872 with the main goal of regulating contracts all across India. It encompasses all areas under Indian authority, except the state of Jammu & Kashmir (which is an autonomous region). Since then, the statute has undergone numerous amendments. The most recent change was made in 2018 with the addition of Section 65A, which ensures that parties who communicate with one another virtually through email or text messages still have equal legal rights.

Prevention of Damage to Public Property Act, 1984:

It imposes a maximum five-year prison sentence and a fine, or both, on anybody who "commits harm by doing any act in respect of any public property."

The Indian Penal Code's provisions may be combined with those under this statute.

What is public property?

Any property, whether movable or immovable (including machinery) that belongs to, is in the ownership of, or is under the jurisdiction of the following is referred to as public property.

• The Central Government
• State government
• Any local authority
• Any corporation that was or is currently operating under federal, temporary, or state law. 
• Any business as outlined in Section 617 of the Companies Act of 1956. These are businesses that the government owns and in which the Central or State government holds at least 51% of the paid-up capital. A corporation that is a government-owned subsidiary is also included in IT.

Conclusion

The whole idea of how to resolve conflicts between the tenant and the landlord by agreeing is provided by the rent control act. This act covered several rights, and many states revised it with the new legislation, in 2020. The rent control legislation explains what must be done to register, the requirements, jurisdiction, and penalties in addition to looking at the rights and obligations of landlords and tenants. Thus, using this article, we can analyze and understand the idea of how crucial it is to obtain a rent agreement and register it by the Registration Act of 1908 to prevent disputes between the parties.

About The Author:

Adv. Rohit Singh, Managing Partner at PSK Legal Associates, is a seasoned commercial lawyer with a stellar reputation. With years of legal experience, he advises prominent clients across industries like education, IT, banking, pharmaceuticals, and more. His expertise spans Civil & Criminal Law, Corporate Law, Property Law, ADR, and Banking Law. Formerly in-house counsel at Reliance Capital, he later worked with the Former Advocate General of Punjab. His strategic legal insights have significantly benefited corporate clients, especially in complex corporate matters.