What is Model Tenancy Act for NRIs?

Model Tenancy Act
Real Estate » What is Model Tenancy Act for NRIs?

Table of Contents

The Model Tenancy Act aims to make tenancy easy and manageable by the NRIs. This Act hopes to help the landlords unlock their rental accommodations inventory, which will further rationalize the price structure in the rental property market.

Objectives of Model tenancy act 2021

On 2nd June 2021, the Union Cabinet approved the 2021 Act which governs both, residential and commercial properties/premises except the properties/premises excluded from the scope of the 2021 Act under Section 3.

The 2021 Act also governs lease agreements, provided they are executed as prescribed under the Act. The 2021 Act does not consider the existing rental arrangements, thereby excluding the huge body of pending tenancy disputes as well.

Some of the primary objectives of the 2021 Act are as under:

  1. To regulate the residential and commercial properties in the rental housing market,
  2. To lay down guidelines for:
    • tenancy,
    • rights and obligations for landlords and tenants, and
    • speedy and transparent dispute adjudication mechanism,
  3. To balance the interests of and make rent laws more equitable for landlords and tenants,
  4. To smoothen the process of renting a property,
  5. To outline the roles of various stakeholders,
  6. To enforce transparency in the process of renting a property, thereby minimizing the of litigations and reducing disputes between the parties,
  7. To create an effective regulatory mechanism in India to govern the relationship between a landlord and a tenant,
  8. To establish suitable rental housing for all income brackets, and
  9. To encourage engagement and resultant investments by private companies in the rental housing sector to address the prevailing enormous scarcity.

Latest news on model tenancy act

Earlier this month the Union Cabinet of India approved the Model Tenancy Act which will replace The Rent Control Act of 1948. This was yet another reform in the series that will help boost investment in the Indian real estate sector. The sector is the second largest employment generator, and needs the government’s attention and hand-holding for a demand boost.

The Model Tenancy Act will be a state subject and will be applicable once the states adopt its version with tribunals making the transaction and dealing with regard to rental activity much more transparent, formal, and enforceable. Indian real estate has long been of interest to the NRIs.

Also Read: Remedies for a Landlord if the Tenant Refuses to leave after an Eviction Notice

New model tenancy agreement

The Model Tenancy Act represents the government’s efforts to institutionalize rental housing by progressively bringing it into the legal market. The government stated in a statement that it expects to offer a boost to private engagement in rental housing as a business model for tackling the massive housing shortfall

Lease agreement rules in India

A lease agreement is a legally binding document. Hence, irrespective of its length or the number of pages it contains, it is essential to include certain mandatory details to make it agreeable to both parties.

The name of both parties with their address

Let us consider an example here. You, as a lessor, are letting out a property that is in the name of both you and your wife. Similarly, the lessees are three individuals who have come to rent it out.

When you are making an agreement, it is necessary to include both your and your spouse’s name as lessor, with your present address. Similarly, although they will be renting out the property, the lessees will have an original address. Include the names of all the three lessees with their original address.

What a lease agreement should contain, therefore, is the name and address of each adult member who will be occupying the rented accommodation/lease property. All their signatures are mandatory too, to make the document valid.

The inclusion of all their names (as well as both your names) gives equal rights to all three individuals and if one of them breaks a rule in the lease agreement, you will have the legal right to end their tenancy.

Lex Solutions

  • It is a boutique law firm based out of  Chandigarh, India with a wide range of Legal capabilities across jurisdictions. It is one of the best law firms in India to foster all your legal needs.

FAQs

Q .Is the Model Tenancy Act applicable in Maharashtra?

The Model Tenancy Act was approved by the cabinet on June 2, 2021, and circulated by the ministry to all states and Union Territories on June 7, 2021. Over a year after, since the Union ministry of housing and urban affairs (MoHUA) circulated the Model Tenancy Act (MTA), Maharashtra has not implemented it.

Q. Can the landlord force the tenant to leave?

Aside from non-payment, a landlord has the right to evict a tenant for subletting a property or unit without prior consent from the landlord. If the landlord decides to repair or use the unit, the tenant must also vacate the property at a given time

Q. What is the lease agreement?

A lease is an implied or written agreement specifying the conditions under which a lessor accepts to let out a property to be used by a lessee. The agreement promises the lessee use of the property for an agreed length of time while the owner is assured consistent payment over the agreed period.

Q. What is the difference between rent and lease?

“Lease” is agreeing with the lessee (in simple terms, tenant) to use a property for a long period of time. “Rent” is entering into a contract with the tenant to use an asset only for a short period. In a lease agreement, property maintenance responsibility lies on the lessee.

Q. Which is better: lease or rent?

In leasing, you’ll have to pay a fixed amount ( it will be 40-50 times that of the rental amount). Additionally, if a particular company requires an asset throughout the year, then a lease is the best option. However, if there is no such demand, then renting is the best option.

Q. What happens if a lease is not registered?

Registration at Land Registry constitutes notice of the lease to all parties and for all purposes. If the lease is not registered, it follows that this notice is not given. The consequence of this is that a landlord may not be able to recover unpaid rent from the guarantor if the tenant fails to pay

Q. How do I get a copy of my lease?

If there is a mortgage on the property, you can ask the mortgage lender if they can give you a copy. The Land Registry will also hold a copy. A fee may be charged for providing a copy of the lease by the Land Registry.

According to estimates, 65% of people living in urban areas around the world are tenants. This is also true in India due to the sky-high prices of real estate in the major cities and the large population of migrant workers who live there. Nevertheless, living as a renter can be a peaceful arrangement, but occasionally there are situations where one can run into rental problems and other connected issues, such as receiving an unauthorized eviction notice or the erratic behaviour of the landlord.

Are you, however, a renter who is experiencing such problems or simply curious about what to do if you ever find yourself in a similar situation? In that case, allow us to help you through this blog, which will briefly discuss about the several protections against landowner harassment.

What does illegal eviction of tenants mean?

An illegal eviction, also known as an unlawful termination of tenancy, typically happens when a landowner forbids a tenant from entering a rental property or removes the tenant’s belongings from the property through the use of force, intimidation, or other methods (such as cutting off utilities or changing the locks). However, if the landowners evict you without taking the proper legal action, they are breaking the law.

How Do You Respond When Your Landlord Forcibly Evicts You?

Almost every state has rental control legislation pertaining to tenant protection, and each state has established specific circumstances for which the landlord may lawfully evict the renter. Additionally, a tenant has a legal right under the law to appear in court and defend himself against unlawful eviction, and some of those accessible remedies for tenants are discussed below:

Grounds for eviction

Non-payment of rent, breach of the lease, property damage, and illegal activity are the most typical grounds for evicting a renter. The tenant must therefore review the provisions of the State Rent Control Act to ascertain the grounds for eviction specified in the Act. In addition, if the tenant is being evicted for any reason other than those specified in the Act—which is considered wrongful eviction—they must seek the help of an eviction lawyer and the enforcement agencies to halt this.

Suit for injunction

A renter might be unable to leave a property when asked to do so for a number of reasons, such as having a medical emergency or having his elderly parents live with him. When this happens, the tenant has the option to file a case in the appropriate court to obtain an injunction that will prevent them from being evicted for any other grounds (other than those listed in the State’s Rent Act). Along with the assistance of housing rental lawyers, the renter should take this action, if they are violently evicted without providing them with adequate notice.

Rent Controller

In the event that the tenant receives a notice of eviction on pretences, they should go see the rent controller of the relevant jurisdiction and explain why they believe the notice of eviction is invalid. Additionally, following the tenant eviction laws, the court will summon the tenant, who will then be forced to submit his or her case and the arguments supporting the necessary evidence.

Notice of rent payment

If the landowner claims that he has not received the required rent and lists this as the reason for serving the notice of eviction, the tenant may legitimately ask him or her to send the information to his bank account so that he can conduct the transaction and deposit the outstanding rent. Moreover, after agreeing to it, the landowner must give the tenant the information within 10 days of the date they received the notice.

Also Read: Lex Solutions – Your One-Stop Destination For All Things Legal

Steps that you must follow to legally evict a tenant in India

Because eviction laws differ from state to state, the following are typical recommendations for evicting a renter. Nevertheless, you can contact the tenants lawyer of Lex Solutions if you need any assistance.

Serve the Tenant With a Termination Notice

The tenancy must be terminated before a landlord can evict a tenant for cause, and the landowner shall provide the tenant with the required notice before taking legal action to do so. Three different kinds of termination notices are generally available:

  • Pay Rent or Quit: The tenant is required to pay the rent within a predetermined period (often three to five days) or leave the rented property.
  • Cure or Quit: A breach of the rental agreement or lease must be remedied by the tenant within a set amount of time.
  • Unconditional Quit: Without a chance to correct the offense or pay the rent, the tenant must leave the property.

But to evict a tenant without good reason, the landlord must give the renter a 30- or 60-day notice to leave the premises.

File an Eviction Lawsuit

If the renter does not correct the issue or quit the property within the allotted time, the landowner must initiate an unlawful detainer case in small claims court. Following this, landlords have the right to evict tenants by serving a legal notice to tenants to vacate their premises.

Wait for the Tenant’s Answer

Within the time frame given on the summons, the tenant may “answer” the complaint. The renter may, however, use the response to refute the charges or present a defence. And, for instance, a tenant might claim that the eviction was carried out in retaliation or that the unpaid rent was used to pay for repairs the landlord refused to undertake.

Receive a Judgment for Possession

A default judgment is granted to the landowner if the tenant ignores the eviction notice India. Moreover, the landowner is entitled to take ownership of the property if the renter replies with an answer but the court rules in his or her favor.

Remove the Tenant

Despite having the right to reclaim the property, the landlord is unable to evict a renter without the help of a law enforcement official. Nevertheless, the tenant will be informed of the legal eviction and the number of days they have to leave once such an official receives the judgment and the cost. Moreover, the law enforcement authority may physically evict the tenant if they don’t leave the property in the allotted period.

Also Read: Introduction To The Indian Judicial System And Court Hierarchy

Summing Up

Now that you are aware of the characteristics of evictions and how to deal with them in a nation like India, you must use them as needed. Additionally, as a landowner, you must evict a problematic renter per the law. And, to ensure that you are acting legally, consult a local landlord-tenant law attorney in your area. For such assistance, a legal firm in Chandigarh, lexsolution can offer you a one-stop solution.

FAQs

  • Can a tenant seek an injunction against the landlord?

According to the state rental rules present in India, a tenant does not have the right to issue an injunction against the landlord. Moreover, injunction procedures are always discretionary, and a court of law cannot grant a perpetual injunction in favour of the plaintiff against the right owner if the plaintiff is only a trespasser.

  • Can police evict a tenant in India?

Even if the renters behave disrespectfully, the police cannot assist in reclaiming the property. However, the only court with the authority to order the eviction of a tenant is the court of the rent controller under whose jurisdiction the property is located. 

  • When a tenant can get the benefit of protection against eviction?

If the tenant can show that the landlord gave his written approval to the subtenant, he is entitled to protection from eviction. Additionally, it disallows any other consent, including implied or oral permission.