It has become very common nowadays to take a rented house or shop by going to a new city or place. For this, a legal agreement is signed between the landlord and the tenant, which is called Rent Agreement. This agreement is usually created for 11 months. But have you ever wondered why it happens only for 11 months, whereas there are 12 months in a year? Let’s know the reasons behind this and benefits.
What is a rent agreement?
The rent agreement is a legal document that clearly mentions property fare, time period, electricity-water bill, security, maintenance and other important conditions between the landlord and the tenant. This ensures the rights and responsibilities of both sides, and the possibility of any dispute is reduced in future.
Why is an 11 -month agreement formed?
Stamp duty prevention: According to Section 17 of the Registration Act, 1908, if any property is given on rent for 12 months or more, then registration of that agreement becomes mandatory. On registering, both sides have to pay stamp duty, which can go up to thousands of rupees based on the price of the property. The 11 -month agreement does not cause this obligation, which saves both sides from stamp duty and additional expenses.
Relief from legal complications: The 11 -month agreement is legally simple for both sides. Long -term lease makes it difficult for the landlord to increase the fare or vacate the house, which can create legal disputes. For this reason, most people prioritize short term agreement.
Advantage of flexibility
The 11 -month rent agreement is convenient for both the tenant and the landlord:
- Landlords can increase the fare by 10 per cent every year, ensuring their income.
- The tenant also has the facility that if he does not like a house or rent, he can go to a new place after 11 months.
This type of flexibility is beneficial for both sides.
The post Rent Agreement Rule: Why is it made for just 11 months? Know the reason and benefits first appeared on News India Live | Breaking India News, The Indian Headline, India Express News, Fast India News.
