In multiple jurisdictions, several real estate analysts and politicians have opposed the Rent Control Act as they feel it is lopsided in favor of landlords.

The Rent Control Act sets guidelines for renting properties and attempts to ensure that all tenants and owners of land are not abused by each other.

Since the property is a subject of the state, each state has a Rent Control Act of its own. Over the years, several states have even come up with changes to their acts.

But generally speaking, most guarantee that owners should not evict tenants without adequate justification or cause and do not refuse tenants basic utilities such as power or water.

In India, in 1915, the very first rent law was passed. But at the time, not all states enforced it. Later, in view of the rising need for rental accommodation in urban cities, several states revised it or come up with a brand new Rent Control Act.

For instance, in 1948, Maharashtra passed the Bombay Rent Control Act that froze rent prices at low levels. It was later repealed and replaced by the Rent Control Act of Maharashtra. Similarly, in the 1950s, states like Delhi and West Bengal developed their Rent Control Acts to ensure that landlords did not abuse immigrants.

In separate jurisdictions, several real estate analysts and politicians have opposed the Rent Control Act as they claim it is lopsided in favor of landlords.

Rent Management Act – Tenancy Arrangement, Occupant & Landlord Rights

In India, the Rent Control Act controls the legislation regulating rent control, the protection of landlords’ rights and the rights of tenants.

1. What is the Act on Rent Control?

The legislature passed a central Rent Control Act in the year 1948. It controls the laws of renting out a property and guarantees that the other is not exploited by neither the owners nor the interests of the tenants.

It can also be remembered that each state actually has its own Rent Control Act, although they have some small variations that are essentially identical to each other. The real estate industry has had trouble rising in some areas due to the 1948 Act being particularly conservative and pro-tenant. There are several buildings that have been leased out since 1948 that still cost the same price of rent, disregarding deflation and increased valuations of land.

In 1992, through a proposed model, the Central Government sought to bring about changes to the Act to ensure that the land was not devalued. The reforms were, sadly, rejected by the sitting tenants and thus refused to take place.

2. What is an arrangement to rent?

In India, for residential or commercial purposes, the rental or lease of any property is subject to separate rules and regulations, such as:

Under the statute, a formal document between the two parties enumerating all the tenancy terms and conditions is a must. In this scenario, an agreement concluded without being expressly set into writing would not be a legal contract.

All adjustments, irrespective of the form of correction, must also be rendered in writing.

The arrangement must be dated by all sides i.e. the landlord and the occupant, and sealed.

-It must be stamped & registered in the agreement.

The rights and obligations of the landlord and the occupant cannot be regulated or covered by statute without a clear rental agreement. It is therefore often advisable to engage the assistance of a legal professional in making such an arrangement, particularly for commercial leasing, as it entails many difficulties.

3. What are a tenant’s rights?

Not only is the Rent Control Act set up to protect the landlord and his belongings, but also to protect the tenant. Under the Statute, the few significant privileges that the tenant is granted are:

Right against Wrongful Eviction: Under the Act, without good justification or cause, the landlord can not evict the tenant. The eviction laws are very different from state to state. He/she must contact the court and seek a court order for the same in some jurisdictions for the owner to evict a tenant. In certain states, whether he or she is able to make any adjustments to the rent, the occupant will not be evicted.

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Equal rent: After leaving a building, the landlord does not charge exceptional rental sums. The price of a rental property would depend on the value of the property. If the occupant thinks that the amount of rent being sought is too much relative to the value of the house, he/she may seek relief from the court. The rent is typically between 8 percent and 10 percent of the value of the house, covering all expenses imposed on the property by building and fixtures.

Basic Utilities: The tenant’s human right is to enjoy essential services such as sanitation, electricity, etc. And if the occupant has refused to pay rent for the same or a separate home, a landlord does not have the right to withhold these facilities.

4. What are Landlord Rights?

In a rental arrangement, the object of interest is always the land, and the property must be secured from undue exploitation. The Rent Control Act confers the following benefits on the landlord:

Right to Evict: There is also a different right to evict a resident from state to state. In some states, for personal and genuine reasons such as having to live there themselves, the landlord can evict a tenant. In Karnataka, such a justification is not an acceptable cause for eviction. In most situations, the homeowner needs to contact the court to evict the tenant. Before reaching the court, it is therefore mandatory by statute for the landlord to give adequate notice to the tenant.

Charge Rent: As the owner of the house, the landlord is entitled to charge the tenant’s rent. As there is no existing law allowing for an upper cap on the rent, the landlord can continue to raise the rent payments according to his wishes. Therefore the sensible thing to do in such circumstances is to state the sum of rise and the condition of rise in the lease agreement itself. The rent is usually raised by 5 percent to 8 percent periodically a year.

Temporary Repossession of Property: In order to improve the state of the property, modify the property in some way or make improvements to the property, the landlord can temporarily repossess the property. Such improvements to the property must not, however, result in any damage to the occupant or have a substantial effect on his tenancy.

5. The Rent Control Act Non-Applicability

There are also cases where after the house has been rented out the Rent Control Act is not valid. There are:

Land issued to private limited or public limited corporations with Rs 1 crore or more paid-up equity capital.

Property allotted or sub-leased to undertakings of the public sector, banks or any company constituted under any state or central statute.

Property is opened to foreign businesses, diplomatic missions or departments.

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