An interesting concept brought about by this model act is the formation of Rent Authorities, Courts and Tribunals which will regulate their own procedure guided by the principles of natural justice and provisions of the act. These bodies will have sole jurisdiction over rent related matters and must resolve disputes within 60 days from the first application. This provision for expedient dispute resolution itself will impulsively attract investments in the business of rental properties, as owners feel safer and protected in case of dispute, unlike the previous legislations that allowed the disputes to go on for multiple years and the property stayed stuck for all that time.
No one will be permitted to rent out any premises except by an agreement in writing and it will be mandatory to register the rent agreement with the district rent authority to be entitled to relief under this act. The tenant will also no longer be allowed to sub-let the property or any part of it without entering into a supplementary tenancy agreement which shall also be registered. In case of the death of either party, their successor will have the same rights for the remaining period of the tenancy agreement.
The act sets out limitations on the security deposit as a maximum of two month’s rent for residential properties and a maximum of six month’s rent for commercial properties, a provision that did not exist before. Also, revision in rent shall not be permitted in the middle of the tenure unless it is stipulated in the agreement. Even to hike the rent for the next tenure, the landlord must give a notice three months in advance, and the tenant if fails to give notice of termination of tenancy, will be deemed to have accepted the revised rent. This puts control back in the hands of the owner, to be able to let his property at his own terms. In case of any dispute regarding revision of rent, the Rent Authority will make a decision.
Rights and obligations of the Tenants as well as the landlords has been balanced and more specifically laid out under this model law, to reduce the possibility of disputes entirely. There is also a whole chapter for eviction and recovery of possession of the premises by the landlord, which was not given as much importance in the previous regulations. The tenant will be liable to vacate the premises if he does not agree to the revised rent notified to him by the landlord in the correct manner as provided in the act.
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