Understanding tenancy in India. Various tenancy agreements.

The relationship between a tenant and a landlord is one of the most common legal relationships in India. Whether you live in a rented home, run a business from rented premises, or own property that you lease out, understanding your legal rights and obligations is essential. Disputes between tenants and landlords are among the most frequently litigated matters in Indian courts, and most of them arise because one or both parties are unaware of the law.

In India, tenancy is governed by the Transfer of Property Act, 1882, the Model Tenancy Act, 2021, the Registration Act, 1908, the Indian Easements Act, 1882, and various state-specific Rent Control Acts such as the Delhi Rent Control Act, 1958. Brokers are additionally regulated under RERA, 2016. This article provides a comprehensive guide covering types of rental agreements, registration requirements, the 11-month practice, tenant and landlord rights, the role of brokers, and landmark Supreme Court judgments.

Part I: Types of Rental Agreements — Lease Deed, Rent Agreement, and Leave & Licence

1. What is a Lease Deed?

A Lease Deed is a formal legal document governed by Section 105 of the Transfer of Property Act, 1882. It transfers the right to enjoy an immovable property from the owner (lessor) to the tenant (lessee) for a defined period, in exchange for periodic rent. A lease deed creates a legal interest in the property in favour of the lessee. Key features include:

Creates a transferable and heritable interest in the property
The lessee has exclusive possession of the property
Protected by Rent Control Acts — eviction requires a court order
Compulsory registration if the term exceeds one year under Section 17 of the Registration Act, 1908
Typically used for long-term residential or commercial arrangements

2. What is a Rent Agreement?

A Rent Agreement (also called a rental agreement) is a shorter-term arrangement between a landlord and tenant. In common usage, it is similar to a lease but is generally executed for periods of 11 months or less to avoid mandatory registration. Key features include:

Creates a limited right to occupy the property for the agreed period
Protected by Rent Control Acts if the duration is sufficient to trigger protection under state law
Does not require registration if the term is less than 12 months
Must be executed on stamp paper of appropriate value
Widely used for residential rentals across India

3. What is a Leave and Licence Agreement?

A Leave and Licence Agreement is governed by Section 52 of the Indian Easements Act, 1882. Unlike a lease, it does NOT transfer any interest in the property. Instead, the licensor (owner) grants the licensee (occupant) a personal permission to use the premises for a specific period. Key features include:

Does not create any interest or right in the property — only a personal permission to use
NOT covered by Rent Control Acts — the licensor retains full ownership rights
Non-transferable and non-heritable — ends on death of either party
Easier to terminate — a notice as per the agreement is sufficient
Widely used in Maharashtra and by landlords who want to retain easy control
Commonly executed for 11 months and renewed periodically

4. Comparison Table — Lease/Rent Agreement vs Leave & Licence

Feature	Lease / Rent Agreement	Leave & Licence
Governing Law	Transfer of Property Act, 1882 & Rent Control Acts	Indian Easements Act, 1882
Interest in Property	Creates an interest / right in the property in favour of tenant	Does NOT create any interest in property
Tenant Protection	Strong — covered by Rent Control Acts	Weaker — not covered by Rent Control Acts
Transferability	Lease is transferable; sub-tenancy can be created	Non-transferable and personal to the licensee
Heritability	Heritable — legal heirs can continue tenancy	Not heritable — ends on death of either party
Eviction Process	Complex — requires court order	Simpler — termination by notice as per agreement
Registration	Compulsory if term exceeds 1 year	Compulsory in Maharashtra; optional in most other states
Typical Duration	11 months to several years	Usually 11 months, renewable
Landlord’s Control	Less control once tenant occupies	More control retained by owner
Preferred By	Tenants (more legal protection)	Landlords (easier to recover possession)

5. Which One Should You Choose?

As a Tenant: A rent agreement or lease deed gives you stronger legal protection. It is harder for the landlord to evict you without valid grounds and a court order. It is the preferred choice if you plan to stay for a longer period.

As a Landlord: A Leave and Licence Agreement gives you more flexibility and control. You can recover possession more easily at the end of the agreement period. It is particularly recommended if you are renting out property for short to medium terms or are unsure about the tenant’s reliability.

Key Case: Associated Hotels of India Ltd. v. R.N. Kapoor (AIR 1959 SC 1262)

The Supreme Court laid down the foundational distinction between a lease and a licence. The Court held that if a document gives only a right to use the property in a particular way while it remains in the possession and control of the owner, it is a licence. If the document transfers possession and creates an exclusive interest in the property, it is a lease. The label on the document is not conclusive — the true nature of the transaction must be determined from its substance and terms.

Key Case: Delta International Ltd. v. Shyam Sundar Ganeriwalla (SC)

The Supreme Court held that where a document nowhere pleads that the deed is a camouflage or sham to evade rent control provisions, the intention of the parties must be gathered from the express words of the document. This judgment reinforced that courts will look at the actual content of the agreement — not just what it is called — to determine whether it is a lease or a licence.

Part II: Registration of Rent Agreements — When Is It Compulsory?

The Legal Position Under the Registration Act, 1908

Under Section 17(1)(d) of the Registration Act, 1908, read with Section 107 of the Transfer of Property Act, 1882, the following documents are compulsorily required to be registered:

Leases of immovable property from year to year
Leases for any term exceeding one year
Leases reserving a yearly rent

All other leases — including month-to-month tenancies and agreements for terms of less than one year (i.e., up to 11 months) — are exempt from compulsory registration under Section 18(c) of the Registration Act.

The 11-Month Practice — Why Do Landlords Insist on It?

The practice of executing rent agreements for exactly 11 months is extremely common across India, and it is entirely legal. Landlords insist on this for the following reasons:

Avoidance of mandatory registration — agreements for less than 12 months do not require registration at the Sub-Registrar’s office, saving time and cost
Lower stamp duty — stamp duty is calculated on the rent amount and duration, so a shorter agreement reduces the overall tax liability
Easier eviction — under most state Rent Control Acts, stronger tenant protections apply after a longer continuous occupation. An 11-month agreement, when not renewed, gives the landlord a cleaner legal position
Avoidance of Rent Control Act protections — in some states, Rent Control Act protections kick in after a year of occupation, which makes eviction significantly more difficult for landlords
Flexibility — both parties can renegotiate terms at each renewal, allowing rent revisions to keep pace with market rates

An 11-month agreement is perfectly valid and legally enforceable. However, it must be executed on adequate stamp paper (value varies by state) and, while not compulsory, it is strongly advisable to have it notarized or registered for added legal protection.

What Happens if a Registrable Agreement is Not Registered?

The unregistered agreement cannot be admitted as evidence in court to prove the terms of the tenancy or affect the rights in immovable property
The tenancy will be treated as a month-to-month tenancy terminable on 15 days’ notice under Section 106 of the Transfer of Property Act
The agreed lease period cannot be enforced — either party can terminate with 15 days’ notice
The parties cannot rely on specific terms of the unregistered document in any dispute

Key Case: Siri Chand (Deceased) v. Surinder Singh (Civil Appeal No. 2617 of 2020, SC)

The Supreme Court clarified that where a lease deed does not specify the period of tenancy, it shall be presumed to be a monthly tenancy and is therefore not compulsorily registrable. However, for agreements specifying a term exceeding one year, registration is mandatory. An unregistered lease for over a year is inadmissible as evidence, and the tenancy will default to month-to-month status.

Key Case: Jeevan Diesel and Electricals Ltd. v. Jasbir Singh Chadha (Delhi High Court, RFA No. 197/2011)

The Delhi High Court held that an unregistered lease deed cannot create a fixed-period lease. In the absence of registration, the tenancy only remains a month-to-month tenancy. Parties cannot enforce the agreed lease period against each other if the document requiring registration has not been registered.

How to Register a Rent Agreement

For agreements that require registration (i.e., those exceeding 12 months), here is the process:

Draft the rent agreement on stamp paper of appropriate value (stamp duty varies by state and is typically 1% to 2% of the annual rent)
Both the landlord and tenant must visit the Sub-Registrar’s office in person, or online portals are available in states like Delhi, Maharashtra, and Karnataka
Carry original identity proof (Aadhaar, PAN, Passport), address proof, property ownership documents, and two passport-size photographs of each party
Two witnesses with valid ID proof must be present
Pay the registration fee (typically Rs. 1,100 in Delhi)
The registered document is then returned to the parties — the registration must be completed within 4 months of execution under Section 23 of the Registration Act

Part III: Rights of a Tenant

1. Right to Peaceful Possession

Once a tenant lawfully occupies a property, the landlord cannot disturb peaceful possession — entering without prior notice, cutting off electricity or water, or harassing the tenant in any manner are all illegal and actionable under law.

Key Case — In Favour of Tenant: Sayeda Rashid v. M.S. Batra

The Supreme Court held that mere expiry of a lease does not entitle the landlord to evict the tenant. Even after expiry, the tenant retains protection under the applicable Rent Control Act until a court order is obtained.

2. Protection Against Criminal Proceedings for Non-Payment

Key Case — In Favour of Tenant: Neetu Singh v. State of UP (2022)

The Supreme Court quashed an FIR filed against a tenant for non-payment of rent under Sections 406 and 420 of the IPC. The Court clearly held that non-payment of rent is a civil matter and does not constitute a criminal offence. Landlords must seek remedy through civil proceedings, not criminal law.

3. Right to Heritable Tenancy

Key Case — In Favour of Tenant: B.R. Mehta v. Atma Devi & Others (1987)

The Supreme Court ruled that tenancy is heritable — legal heirs living with the original tenant can continue the tenancy after the tenant’s death. A landlord cannot evict the family of a deceased tenant simply because the original tenant has passed away.

Part IV: Rights of a Landlord

1. Eviction for Bona Fide Need

Key Case — In Favour of Landlord: Sarla Ahuja v. United India Insurance Co. Ltd.

The Supreme Court held that once a landlord demonstrates a genuine and bona fide need for the rented premises, eviction of the tenant must be granted. The need must be real and not a pretext, but courts must evaluate it without undue sympathy towards either party.

2. Tenant Cannot Claim Ownership Through Long Occupation

Key Case — In Favour of Landlord: Jyoti Sharma v. Vishnu Goyal (SC, January 2026)

The Supreme Court categorically held that a tenant can never become the owner of a rented property regardless of how long they have occupied it. Since the tenant’s possession is ‘permissive’ and not ‘hostile’, the doctrine of adverse possession cannot apply. The Court referred to Balwant Singh v. State of Punjab (1986) and Ravinder Kaur Grewal v. Manjit Kaur (2019) to reinforce this position.

3. Tenant Cannot Dictate Landlord’s Business Decisions

Key Case — In Favour of Landlord: Kanhaiya Lal Arya v. Md. Ehshan (SC, 2025)

The Supreme Court reaffirmed that tenants cannot question the genuineness of the landlord’s requirement for personal use of the property, nor can they dictate the manner in which the landlord intends to use it. Once good faith is demonstrated, tenant objections have no legal standing.

Part V: The Role of a Property Broker and Legal Consequences

Who is a Property Broker?

A property broker (also called a real estate agent or property dealer) facilitates rental or sale transactions between landlords/sellers and tenants/buyers, typically in exchange for a commission. Under Section 2(zm) of RERA, 2016, all brokers involved in registered real estate projects must obtain mandatory RERA registration.

Legal Obligations of a Broker Under RERA

Provide accurate and complete information about the property, including its legal status and approvals
Disclose commission being charged to all parties
Not facilitate the sale or rental of any unregistered project
Maintain books of accounts and records available for inspection
Act with honesty, integrity, and transparency
Not engage in misleading or fraudulent representations about a property

Penalties for Brokers Under RERA

Non-registration: Rs. 10,000 per day of default, up to 5% of project cost
Marketing unregistered projects: Penalty up to 5% of project cost and suspension of registration
Fraud or unfair trade practices: Imprisonment up to 1 year and/or financial penalty
Non-compliance with RERA orders: Fine up to 5% of estimated project cost per day
Non-compliance with Appellate Tribunal orders: Imprisonment up to 3 years or fine up to 10% of project cost, or both

Key Case — Broker Liability: M/S Angle Properties v. State of Maharashtra (MahaRERA)

MahaRERA directed a real estate agent to refund the booking amount paid by a buyer after the agent failed to disclose accurate information about project completion. The Authority held that non-disclosure of material information amounts to a violation of RERA obligations.

Remedies Against a Fraudulent Broker

File a complaint before the RERA Authority of your state under Section 31 of RERA
File a complaint before the Consumer Disputes Redressal Forum under the Consumer Protection Act, 2019
File a civil suit for recovery and damages
Lodge a police complaint for deliberate fraud under Sections 420 and 406 IPC

Part VI: Practical Tips

For Tenants:

Always insist on a written rent agreement on proper stamp paper before occupying
Prefer a registered agreement for stronger legal protection, especially for longer stays
Keep receipts for every rent payment and maintain records of all communication
Verify the identity of the landlord and confirm ownership of the property before paying any advance
Do not pay any advance in cash — always pay by bank transfer
Verify your broker’s RERA registration number before engaging their services

For Landlords:

Use an 11-month agreement if you want flexibility, but ensure it is on proper stamp paper
Register longer agreements to protect your rights and make the document admissible in court
Photograph the property and prepare a written inventory before handing over possession
Collect all payments by bank transfer and never accept cash without a signed receipt
If using a broker, insist on a written brokerage agreement and verify their RERA registration
Serve all notices in writing with documented proof of delivery

Conclusion

The tenant-landlord relationship, when built on mutual understanding, proper documentation, and awareness of the law, can be a smooth and beneficial arrangement for both parties. The type of agreement chosen — lease, rent agreement, or leave and licence — has significant legal consequences that both parties must understand before signing.

The Supreme Court of India has consistently worked to balance the rights of tenants and landlords, ensuring that neither party can take undue advantage of the other. The registration of agreements, while sometimes perceived as a formality, is in fact a critical step in protecting the rights of both parties.

At the Law Chamber of Amit K Pateria, we have extensive experience in drafting, reviewing, and litigating matters related to tenancy agreements, eviction proceedings, broker disputes, and RERA complaints. Whether you are a tenant, a landlord, or an NRI property owner, our expert team is here to guide you.

Disclaimer: This article is intended for general informational purposes only and does not constitute legal advice. For advice specific to your situation, please consult a qualified legal professional.

Rights of Tenant & Landlord in India: Agreements, Registration, Role of Broker & Key Judgments