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Rights of the Tenants | Know Before Signing Rental Agreements with Landlord!

The rent act is basically an act protecting the interest of tenants. These acts were passed by the legislatures in Indian states immediately after independence in India to protect old tenants occupying the houses since long as there was shortage of houses overall and to prevent the landlords to evict the tenants as it would put tenants in a miserable condition. However, with the passage of time the rent became unprofitable and the landlords ignored to repair and maintain the houses as they were not likely to get the possession. On account of the same the tenanted houses become dilapidated and tenants were left at the mercy of God. Because of the same and also because of the increase of other housing stock, the states have started reforming rent act. However, the provisions of rent acts are still applicable in most parts of the nation.

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Tenants afraid of Landlord

There might be times when your landlord will commit some actions which are deemed unlawful and you will be able to enjoy certain rights that you have as the tenants. What are those actions, rights, where you can seek justice under the act? This article covers such questions in detail.

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Tenant means any person who is responsible for paying rent for a building and it includes spouse, children, or any member who have been living as a member of the tenant’s family. Rent control act restricts the power of the landlord and gives reasonable powers to the tenants for the purpose of protecting both, the tenants and the landlords from deceit. Rent Control Act in many states is the combination of many acts like Tamil Nadu Buildings Act, 1960,‘Rent Control Act 1999’ and ‘Rent Control Act 1958. Almost all states across India have similar acts.

Tenancy is of two types, contractual tenancy and statutory tenancy, which can affect the way the law is applied. Contractual tenants are those which are entitled to tenancy during the term of the contract. Statutory tenancy is when the tenant resides in the property even after the expiration of the contract i.e. his tenancy has expired under the rule of law but by get virtue of statues or law, he has the right to pay rent and continue occupation under rent control or other emergency legislation.

Rent Control Act

Rent Control Act discusses rights and restrictions as follows

01. Fixation of Fair Rent – Standard Rent

Fixation of Standard Rent Between Tenant and Landlord

The landlord cannot charge more than 15% of the market value of the property as a standard rent, while it can charge a maximum of 25% for non-residential buildings. If the rent is higher than the maximum limit, the tenant can go to the Rent Control Court which will hear the dispute and fix a fair rent or standard for the building and it will be binding to both the landlord and the tenant. Fair rent is considered to be 9% for residential buildings. The rate of return on the investment in the form of tenanted house will also depend upon the return on other securities and the prevailing rate of interest. However, the courts in past allowed 6% return on the investment, which is considered low particularly when the rate of interest is high or the market is inflationary. The rent fixed by the Rent Control Court should be followed even if the rent before the application was lower or higher than the one fixed by the Rent Control Court.

02. Restriction on Advance Received

The landlord cannot receive any money in excess of the rent fixed by way of advance. The restriction for such an advance is that the amount of advance should not exceed that of one month’s rent. If the landlord asks for more advance than such amount, the tenant can go to the Rent Control Court.

03. Receipt to be Given

In some states, the landlord is liable to give receipt of receiving rent or advance from the tenant. The receipt should be signed by him and should mention the actual amount of money that was given by the tenant and the month for which the rent was paid.

04. The Right of a Tenant to Deposit the Tent

The tenant has a right to deposit rent to the landlord for the building being resided and if the landlord does not accept the rent or in case, if his location is not known, the tenant can undertake certain steps like:

Normally during the pending disputes in court the landlord refuse to accept the rent with a view to create a case that the tenant is not paying the rent. On account of the same the act has given some protection to the tenants and similar protections have also come into practice by way of judgement of the courts.

  • Give notice in writing to the landlord (The notice to the landlord shall be given within 10 days of the receipt) for accepting rent, or if not possible, sharing the bank details of their account so the tenant can deposit the rent or can pay online.
  • If the bank details are not shared, one can send the rent to landlord via money order.
  • If the landlord fails to accept this too, then the tenant can file an application before the Rent Control Court and deposit the due rents to the court.

05. Eviction of the Tenants

The landlord can evict the tenant only if the tenant violates any terms of the contract or commit any act which is violation of under the Rent Control Act. However, in such cases for the landlord cannot on it own evict the tenant but should apply to the Rent Control Court and sue for eviction and possession. The landlord can only sue if the tenant is / has,

  • Not paying rent even after fifteen days of the end of the month for which rent is payable
  • Used the building for any other purpose other than which was agreed for
  • Sub-let the apartment / home or have given the rented property to any other third party for rent as a sub tenant.
  • Cause nuisance to the neighbors
  • Committed any offense while staying in building or has used the building, or let the building be used by any other person, for illegal purposes prohibited under law
  • Denied the title of the landlord to the owner or has claimed permanent tenancy
  • Or if the landlord wants the apartment for his own personal occupation. (Personal occupation is restricted if the tenant is under contractual tenancy) In these cases, the Rent Control Court will decide whether the tenant should be evicted and application be granted or not.

The tenants cannot make any changes in the property without the permission of the landlord. Many tenants do this out of ignorance and they lose the right available to them as a tenant.

06. Right to Habitable Stay

The tenant has a right to have a habitable property which includes basic amenities which is necessary for living in the apartment. If there is lack of any basic amenities, the tenant can inform the landlord to make necessary repairs and if the landlord fails, the tenant can file an application to the Rent Control Court, and get necessary instructions for further action.

Landlords Making Repair of House for Tenants

07. Restriction to Disconnect Basic Amenities

It is unlawful for the landlord to damage the basic amenities which include supply of water, sewerage, electricity, passages, staircases, light, lavatories, lifts and conservancy or sanitary services, and if there is any obstruction or damage, the tenant can sue the landlord for repairs.

If in case the landlord does not repair the basic services or maintain the services the tenant can repair the same after giving notice and recover the amount spent from rent payable. However, with reform all around a liberalization such protection are becoming difficult to enforce and slowly tenants are loosing protection, which was perhaps one sided.

These restrictions and rights that are given to the tenant can be used by them for safeguarding them against any abuse by the landlord. The Rent Control Act may differ from state to state but the above-mentioned rights are basic and they also may be or may not be in harmony with other acts of state.

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