Lease Deed in India: Meaning, Contents And Registration

Published on 21 May 2019 by Shivi

When a property is used and enjoyed by the person in possession of it in exchange for a consideration to the actual owner, the property is said to be leased or rented. When a property is given of a lease, it means that the lessee or the tenant can use the property for a definite period of time for which he/she would be required to pay a certain fixed amount of rent. When this period extends to more than a year, a Lease Deed must be drafted.

What is a Lease Deed?

A lease deed is a written contract between a landlord (lessor) and tenant (lessee), which states that the landlord would receive a periodic payment in exchange of allowing the tenant to use and occupy the property. The lease deed also defines the terms and conditions that govern the relationship between a landlord and a tenant during the period of lease.

A lease deed is generally required when the property is leased for a long period of time, ranging between 1-5 years or even longer. In such cases, a lease deed plays an important role to govern the relationship between the landlord and tenant and lays down the provisions legally binding over them.

A lease deed must be drafted by a good documentation lawyer in India who can understand the requirements of both the sides and draft an unbiased deed that protects the interest of both the landlord and tenant. Consulting a documentation lawyer becomes more important when the lease deed is required for a commercial property like office, factory or shop.

Key Contents of a Lease Deed in India

The most important provisions that must be included in every lease deed in India are as follows:

  1. Description of Property: The lease deed must contain the description of the property like the area, location, address, structure, furniture and fittings, etc.
  2. Duration: The lease deed must clearly state the time period for which the lease deed will be valid. This provision can also include the information relating to the renewal of the lease deed if both the parties wish to continue and renew their contract.
  3. Rent, Maintenance, and Security: The amount of rent, mode of payment, due dates, security deposit to be paid, interest on delay in payment, etc. must be clarified in the lease deed. The lease deed must also include the details and responsibility for paying any maintenance charges, utility bills, society charges, etc.
  4. Termination of Lease: The lease deed must state the reasons for which the lease agreement can be terminated. This may include breach of lease deed, use of the property for illegal acts, failure to pay rent, nuisance by the tenant, etc.
  5. Subletting: The lease deed must state whether the tenant is allowed to sublet the property or not.
  6. Dispute Resolution: The agreement must mention the manner in which the legal disputes between the landlord and tenant arising out of breach of the lease deed will be dealt with. This may include any ADR processes like Arbitration.
  7. Applicable Laws: This provision states the laws which will be applicable over the lessor and lessee in case of a dispute and which court will have jurisdiction to deal with such matters.

The above-mentioned lease deed format can be used in both residential as well as commercial leases. However, a corporate lease deed must be more detailed and include the details of the business, indemnity, etc. A documentation advocate in India can assist in drafting a customised lease deed in accordance with the type of lease deed.

Once the lease deed is drafted, it must be registered with the Registrar or Sub-Registrar of the district in which it is located. A lease deed is registered after paying the requisite stamp duty, which differs from state to state. For instance, lease deed registration in Delhi is done by paying stamp duty at 2% of the average annual rent when the lease is for up to 5 years and 3% of the average annual rent when the lease is for more than 5 years and up to 10 years.

Documents Required for Registration of Lease Deed in India

For registering a residential lease deed basic documents are required:

  1. Lease deed
  2. Stamp paper
  3. Receipt of registration fees.

For registering a commercial lease deed, the following documents are required:

  1. Power of attorney/board resolution on company letterhead.
  2. ID proof like Aadhaar Card, Driving Licence, Passport, etc.
  3. Address Proof of the authorized signatory.
  4. Passports sized colored photographs of the authorized signatory.
  5. Company PAN card.
  6. Company seal/stamp of authorized signatory.

Legistify can connect you with the best property documentation lawyers in India who can assist you with the drafting and registration of Lease Deed in any district or state. Call us at  846-883-3013 or send us an email at [email protected].


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