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How to safeguard my interest while renting my shop
16-May-2023 (In Landlord/Tenant Law)
My nephew who is disabled has a shop that he inherited from his parents. He is finding it hard to manage and is considering letting the shop. It is possible he might consider selling. The question is if he lets the shop, what safeguards need to be put in place to ensure he will get vacant possession when the agreement runs out. I am his uncle and I want to make sure letting the shop is an option. Being disabled if he runs into any issues it will be very difficult for him. He can not afford to lose the shop in case someone does not pay the rent or vacate it.
A rent agreement is a legal document which binds the landlord and the tenant to comply with the mutually-agreed conditions. It is the most crucial document in case of a dispute between the two.
Therefore, utmost care should be taken in drafting the document. It should state all terms and conditions clearly to avoid any dispute in future. "Take the help of a legal expert to draft the lease agreement.
These are the points one must consider while finalising the agreement.
1) Name, address, father's name of both the tenant and the landlord should be clearly mentioned.
2) It should be verified that the lessor is the legal owner of the property or a person duly authorised by him or a person authorised by a court to enter into such a contract.
3) The rent should be clearly mentioned (also whether it includes maintenance fee). The quantum of increase in rent and from which date should also be made clear. The mode of payment, whether in cheque or cash, plus the date of payment, is also important. Any interest to be paid in case of delayed payment should also be stated clearly.
4) The period of tenancy should be clearly mentioned. The security amount and the lock-in period are also important. How the amount will be refunded or whether it will be adjusted in the advance rent should also be clearly mentioned.
After preparing the lease agreement, the most important task is to get it registered. Every lease agreement should be registered because only then it can be used as evidence in the court in case of any litigation. However, as per Section 17 of the Registration Act 1908, it is compulsory to get the agreement registered only if the lease period is more than 11 months. For registration, stamp duty and registration fee have to be paid.
Therefore, utmost care should be taken in drafting the document. It should state all terms and conditions clearly to avoid any dispute in future. "Take the help of a legal expert to draft the lease agreement.
These are the points one must consider while finalising the agreement.
1) Name, address, father's name of both the tenant and the landlord should be clearly mentioned.
2) It should be verified that the lessor is the legal owner of the property or a person duly authorised by him or a person authorised by a court to enter into such a contract.
3) The rent should be clearly mentioned (also whether it includes maintenance fee). The quantum of increase in rent and from which date should also be made clear. The mode of payment, whether in cheque or cash, plus the date of payment, is also important. Any interest to be paid in case of delayed payment should also be stated clearly.
4) The period of tenancy should be clearly mentioned. The security amount and the lock-in period are also important. How the amount will be refunded or whether it will be adjusted in the advance rent should also be clearly mentioned.
After preparing the lease agreement, the most important task is to get it registered. Every lease agreement should be registered because only then it can be used as evidence in the court in case of any litigation. However, as per Section 17 of the Registration Act 1908, it is compulsory to get the agreement registered only if the lease period is more than 11 months. For registration, stamp duty and registration fee have to be paid.
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Adv. Siddhant Sharma
Delhi | 200+ Answers
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Disclaimer: The above query and its response is NOT a legal opinion in any way whatsoever as this is based on the information shared by the person posting the query at lawrato.com and has been responded by one of the Divorce Lawyers at lawrato.com to address the specific facts and details.
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