Lease Deed Registration: Everything You Should Know
Property

Lease Deed Registration: Everything You Should Know

Renting a house or a commercial property requires a lease deed. A lease deed is a written agreement that governs the terms between a landlord and a tenant. To enforce the terms of a lease deed, you need lease deed registration. Let us see what the various aspects of a lease deed registration are 

Lease Agreement Registration

If your lease deed exceeds 12 months, then you require a lease agreement registration. If you have not registered your lease agreement, you cannot present it as proof in a law court. Lease agreement registration also helps in protecting the rights of the parties. A landlord is more comfortable giving his house to a renter if the lease agreement is legally and validly registered. A lease agreement need not be registered if it is only for 11 months. This is why you would see a common practice of leasing out properties for only 11 months. 

Before you start the lease agreement registration process, you need to have a valid rent agreement in place. Your rent/lease agreement should preferably have the following clauses:

  • Duration: You should mention the period for which the lease agreement is being entered into. If the time period is less than 12 months, then you need not register the same. 

  • Amount of rent: You should mention the amount of rent to be paid and the due date on which it is to be paid. 

  • Security deposit: You should mention the refundable deposit, which the landlord would keep as security, and the refund process. 

  • Lock-in period: This is the minimum period for which the parties need to be in agreement. They cannot terminate the agreement during this period. 

  • Notice period: The lease agreement should contain the period of notice each party needs to give to end the agreement. 

  • Usage: the renter needs to maintain the property in good condition.  

  • Terms related to sub-lease of the property. 

  • Rent escalation clause. 

  • Maintenance fees to be paid, if any. 

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You can get your lease agreement registered at the office of the Sub-Registrar of Assurances; in whose jurisdiction the leased property is situated. You need to register the lease within four months of signing the lease agreement. If you fail to do so, you may ask for an extension, but a hefty penalty may be levied. Both the tenant and the landlord need to be present at the time of registration. Two witnesses should also be present at the time of lease agreement registration. If one of the parties is unable to be present, then they can give the power of attorney to their lawyer and their lawyer can get the lease deed registered on their behalf. 

Following documents are required for registration of a lease deed: 

  • The original proof of ownership of the property. 

  • Property documents of the property to be leased. A tax receipt can be submitted as a property document. 

  • Two photographs each of the parties and one photograph each of the witnesses. 

  • Address proof copy of the landlord, tenant and the witnesses. You can submit your Aadhaar, bank passbook, passport etc. as your address proof. 

  • The rental agreement printed on the stamp paper of the correct value. 

Stamp duty varies in different states. In Delhi, you need to pay stamp duty at the rate of 2% for lease agreements for a term of up to 5 years and at the rate of 3%, if the lease deed exceeds 5 years. The lease deed registration fees is INR 1100. This fee does not depend upon the value of the property. 

Online Lease Agreement Registration

In some states, lease agreement registration may be done online as well. For instance, in Maharashtra lease agreement online registration may be done. Let us examine the process for lease agreement registration online: 

  • You need to first check if online lease agreement registration is possible in the state where you live. 

  • If yes, then visit a government authorised website and create your profile there.

  • You may need to enter certain information such as the location of your property, area of your property, what property type it is, address etc. 

  • Once you have completed this step, you would be given a token number which you will have to use as user ID for logging in next time. 

  • You would then be asked to enter details of the parties to the lease agreement. You need to mention details such as whether you are an individual or a company, what is your occupation, address etc. 

  • Once you have entered all the details, you will be asked if you want to pay stamp duty and lease deed registration fees online. You can pay these charges through an online challan. You need to enter certain information such as address of the property, landlord and tenant’s name, CTS number of the property (for properties already under city survey), location of the property etc. 

  • Once, you have paid the lease deed registration fees and the required stamp duty, you will need to book an appointment with the sub-registrar. Remember, that a lease agreement registration online, does not mean that you will not have to go to the sub-registrar’s office. It just makes the process of lease deed registration easier. When you get the appointment, go to the sub-registrar’s office on the said date with all the relevant documents. The sub-registrar would finalise your registration. Documents required for online registration of lease agreement are the same as those required for physical registration of a lease agreement. 

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While online lease agreement registration is easier than physical registration, it is not prevalent in many states. It is always preferred that you take legal help to draft a lease agreement. A lawyer would guide you through the drafting and registration process and will help you save time.