There are some of the legal requirements for a vacant land rent agreement to follow when renting a property or taking one on rent. It requires that all the leave and license agreements must necessarily be stamped and registered. While this is still the general guideline, the pricing and laws differ depending on the state in which you want to lease a property.
The acquisition of a property isn’t the only component of ownership that necessitates a lot of paperwork. Landlords and tenants must both engage in the documentation for rental agreements to be legally binding. To complete this process, the agreements for leave and license must be stamped and registered, and a stamp tax must be paid. Because stamp duty is a state affair, each state has its stamp duty rates and laws. In this article, we’ll look at the law in Maharashtra that governs the laws related to vacant land rent agreements and the registration of leave and license transactions.
According to Section 55 of the Maharashtra Rent Control Act, 1999 every tenancy agreement, regardless of its duration, must be in writing and must adhere to all stamp duty and registration rules that apply to the leased property.
Every rent agreement for leases of immovable property from year to year, or for any term exceeding one year, is required to be registered mandatorily under Section 17 of the Indian Registration Act, which applies across India. Every leave and license agreement for 12 months or more must be registered, unless state laws provide otherwise.
Regardless of tenure, every vacant land rent agreement must be in writing with mandatory registration, according to Section 55 of the Maharashtra Rent Control Act, 1999. The tenant’s tax receipt, the landlord’s tax receipt, and a few witnesses’ documents such as passport-size pictures, ID evidence, an electricity bill, and property paperwork are all that are required.
Section 55 of the Maharashtra Rent Control Act, 1999– Any arrangement for leave and license or letting of any premises entered into between the landlord and the tenant or licensee, as the case may be, after the commencement of this Act must be in writing and registered under the Registration Act, 1908.
The landlord is responsible for having such an agreement registered, and in the absence of a written registered agreement, the tenant’s contention about the terms and conditions under which a premises has been given to him on leave and license or has been let to him shall prevail, unless otherwise proven.
On conviction, any landlord who violates the terms of this section faces a maximum sentence of three months in prison or a fine of rupees 5,000 or a combination of the two.
The Bombay Stamp Act, 1958 governs the stamp duty on lease agreements in Maharashtra. It is governed by Article 36 of the Act, as well as Article 25 of Schedule 1 to the Act. A flat stamp duty charge of 0.25 percent of the total rent for the time must be applied to all vacant land rental agreements, leave and license agreements. It is to be noted that the stamp duty rate is the same for both residential and commercial properties for a period of up to 60 months.
Non-judicial stamp paper, e-stamping, and franking are the three methods for paying stamp duty.
Non-judicial stamp paper – The agreement comprises all facts related to the leave and license and is signed by the executants in the case of the non-judicial stamp paper procedure. The agreement must be registered at the sub-office registrars within the next four months.
Franking- This process necessitates printing the agreement on plain paper and then submitting it to a bank. The documents are processed by a special franking machine at the bank.
It’s crucial to remember that, while stamp duty can be avoided in some cases, paying insufficient stamp duty might result in a harsh penalty for evasion.
In Maharashtra, the registration fee for tenancy agreements varies by location. The registration fee for properties within the municipal corporation area, for example, is Rs. 1000. In rural areas, however, the fee is Rs. 500. Both the landlord and the tenant must register the rent agreement. Failure to do so could result in the landlord being sentenced to three months in prison and a fine of Rs. 5000.
In Maharashtra, registering leave and license agreements is required regardless of the rental length, although in many other states, registering a vacant land rent agreement is not required for rentals of less than 12 months.
In Maharashtra, leave and license agreements can be entered for a maximum of five years.
Such agreements are subject to the following Stamp Duty and registration fees:
Consideration Value: The total rent payable during the rental period plus the non-refundable deposit received by the landlord is referred to as the Consideration Value. The term “urban area” refers to places within the jurisdiction of a municipal corporation. All other places are classified as rural.
Step 1: Visit the official website of the Department of Registration and Stamps Maharashtra in your browser
Link for the page: https://efilingigr.maharashtra.gov.in/ereg/
Step 2: Go to the New Entry Pane, and select the district where the land property is located.
Capture a thumb impression using a thumb scanner, and create a password.
Step 3: Click on Next
Step 4: Fill in the details of the rented property
Step 5: Select Next: Party Details
Step 6: Fill in the information for the property’s owner, the landlord.
Step 7: Fill in the witness’s details. Two IDs’ details must be entered.
Step 8: Select Add: Identifier and repeat the process for the second identifier.
Step 9: Fill in the rental information as well as any other terms and restrictions.
Step 10: Pay the Registration Fees and Stamp Duty online.
Note: Select View Draft Document from the drop-down menu. The Rent Agreement can be viewed and any necessary adjustments made.
Step 11: Read the created document and then click Execute after double-checking all of the information.
Step 12: Take a photo of the parties and a thumb impression of the parties in agreement. Save the file and click Admission.
Note: Double-check the parties’ photos and thumb impressions from the previous steps. To get started, go to Admission.
Step 13: Enter the parties’ Aadhar numbers and click Verify eKYC.
Step 14: A Token Key will be generated after you enter your information. The agreement and payment receipts can be downloaded using this Token Key.
Vacant land rent agreement in inevitable but we suggest to go for a physical rent agreement registration through a professional to avoid future complications.
Reference:
https://efilingigr.maharashtra.gov.in/ereg/
https://ecounsel.in/section-55-of-the-maharashtra-rent-control-act-1999/
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