Model Tenancy Act 2021? Know Your Rights And Duties As Tenant Or Owner

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Model Tenancy Act 2021? Know Your Rights And Duties As Tenant Or Owner

The Union Cabinet, chaired by the Prime Minister of India, on 2 June 2021 has approved the Model Tenancy Act. The Central Government has asked for its circulation to all States/Union territories for adaption by way of enacting fresh legislation or amending existing rental laws suitable. The Central Government had first released the draft of the act 2 years back intending to bridge the gap with trust between tenants and landlords by clearly defining their responsibilities.

In a press release, the Government stated that the Model Tenancy Act will ease the unlocking of unoccupied residential properties for rental purposes. It is projected to provide momentum to private participation in residential rental properties as a commercial model for dealing with the shortage in housing, the government further said.

Here are some of the important features of this act:

  • The government said that the Model Tenancy Act aims to create the best, sustainable and inclusive rental housing market in India. It will enable the creation of huge rental housing stock for all the income groups thereby solving the issue of home deficiency.
  • The act will enable institutionalization of rental housing by slowly shifting it towards the formal market, it further said.
  • The typical Tenancy Act talks about founding a rent authority to control renting of properties and to protect the interests of landlords and renters. The planned authority will also deliver a speedy settlement mechanism for the determination of disputes and matters connected therewith or incidental thereto, consistent with the act.
  • It also controls the amount of security deposit - usually, there is a disagreement between property owners and tenants - to a maximum of 2 months of rent in case of residential properties and 6 months in case of commercial properties. Presently, this amount varies from one city to another. For example, in Delhi, the deposit is generally 2-3 times the monthly rent, but in Mumbai and Bengaluru, it can be over 6 times the monthly rent.
  • Another important point where the mentioned act has provided a mechanism is freeing the properties. The Model Tenancy Act declares that if a property-owner has followed all the conditions mentioned in the rent agreement - giving notice, etc - and the renter fails to leave the property after the expiration period of tenancy or termination of tenancy, the landlord is eligible to double the monthly rent for two months and four times after that.
  • Every property owner or the property manager has to send a notice to the renter in written or through E-mail at least 24 hours before in any condition if they want to enter in a rented property, the act defines.
  • It has further described in depth the rights and responsibilities of both proprietor and renter and has also dealt with different issues which can create some disputes between both parties.

Answers to the important questions regarding the Model Tenancy Act

Q. Will, it affects the existing tenancy? 
Ans. No, it will not affect the existing tenancy.

Q. What is the limit of a security deposit? 
Ans. Two months rent for residential properties and six months rent for commercial properties.

Q. What are the responsibilities of landlords?
Ans. Landlords will be responsible for:

  • Structural repairs except those necessitated by damage caused by the tenant.
  • Whitewashing of walls
  • Painting of doors & windows
  • Changing and plumbing pipes when necessary
  • Internal and external electrical wiring and related maintenance when necessary.

Q. What are the responsibilities of tenants?
Ans. Tenants are responsible for:

  • Drain cleaning
  • Witches & socket repairs
  • Kitchen fixtures repairs
  • Replacement of glass panels in windows & doors
  • Maintenance of gardens & open spaces

Q. What are the provisions for rent revision?
Ans. The revision shall be as per the terms set out in the tenancy agreement.
If not agreed otherwise in the agreement, the landowner shall give notice in writing three months before the revised rent becomes due.
If the tenant, who has been given notice of an intended rent increase, fails to give notice of termination of tenancy to the landowner, he shall be deemed to have accepted whatever rent increase has been proposed by the landowner.

Q. What are the rules about the eviction of tenants?
Ans. The tenant will now be evicted during the continuance of the tenancy agreement unless otherwise agreed to in writing by both parties.