Lease Deed

Untitled Document

Introduction
Process
Advantages / Features
Documents Required
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INTRODUCTION

A lease is an arrangement wherein the property is being used and enjoyed by another person, who is not the owner of the property. This arrangement involves the transfer of the right to enjoyment from the lessor (owner/landlord) to the lessee (tenant), and such transfer takes effect based on the terms and conditions mentioned in the lease deed.

As per the Registration Act, 1908 it is mandatory to register a lease deed which is for a duration more than eleven months.

PROCESS

Stamp Duty and Registration Fee: In order to register the lease deed, the calculation and payment of stamp duty is necessary. Such duty is calculated on the basis of the annual average rent and the tenure of the agreement. The rate varies from state to state.
Registration Charges also need to be paid. They also depend upon the average annual rent and the duration of the lease and vary from state to state
Sub-registrar’s office: After paying the stamp duty and the registration charges, both the landlord and the tenant, along with two witnesses have to visit the sub-registrar’s office, to get the deed registered.
PAN Card
Stamp Paper or e-stamp paper and registration fee receipt

Features

Identification of Parties: A lease deed should clearly specify who is the lessor and who is the lessee. In other words, the identification as to the owner or landlord and the tenant has to be made.
Duration: Another very important aspect of the lease deed is to clearly specify the duration of such arrangement, subsequent to which, the right of enjoyment of the property in question would flow back to the owner
Property or part of property being leased: The deed must specify the property being leased out. In many instances, people only lease out a part of the property, such as a room, and not the entire premises. In such cases, it is must that the limits of enjoyment be defined.
Rent and consideration: the deed should clearly specify the amount, method and intervals in which the rent of the property must be paid. It is essential to consult the state’s rent control laws as they determine and cap the amount of rent that can be charged.
Renewal and termination: the lease deed must specify whether there is an option with the parties to renew the deed, and extend it beyond the initial duration. It should also specify the mode, acceptance, and application etc. for such renewal. Apart from that, it should also specify the circumstances which would cause the termination of the deed. Such breach would cause the rights of enjoyment with the tenant to cease.