This Article is written by Anjali Bharti of Dharamshastra National Law University, Jabalpur, an intern under Legal Vidhiya
INTRODUCTION
A rent agreement is a legally binding contract that sets out the mutual understanding between a landlord and a tenant. It clearly defines the rights and responsibilities of both parties, covering essential details such as the monthly rent, duration of the tenancy, amount of security deposit, notice period for vacating the property, and procedures for maintenance and repairs.
In everyday terms, it’s like a written agreement that helps prevent confusion and keeps both sides accountable. It typically includes terms related to property usage, restrictions on subletting, rules for guests, and conditions under which the agreement can be terminated or renewed. Having a rent agreement in place is not just a formality—it plays a vital role in safeguarding the interests of both landlord and tenant, providing a legal recourse in case of disputes, and ensuring that the rental arrangement runs smoothly and transparently.
A nationwide Rent Control Act was introduced in 1948 to oversee rental agreements and protect both landlords and tenants from unfair practices. While the Act set a foundation, today each state follows its own version of the Rent Control law. These laws are generally similar but differ slightly in certain provisions.
However, the original 1948 legislation was heavily skewed in favor of tenants, which has, over time, created obstacles for the real estate sector in some regions. In fact, there are cases where tenants continue to pay the same rent fixed decades ago, without accounting for inflation or rising property values.
In 1992, the Central Government attempted to reform the law through a proposed model that aimed to prevent the undervaluation of property. But the initiative faced strong resistance from tenants and ultimately did not move forward.[1]
TYPES OF RENT AGREEMENTS IN INDIA
In India, rental arrangements can take various forms, depending on the nature of the property and the needs of the parties involved. The four commonly used types of rent agreements are Commercial Rental Agreements, Residential Rental Agreements, Single Room Rental Agreements, and Shared Rental Agreements. Understanding these categories helps tenants and landlords enter into clear and legally sound agreements.
1. Commercial Rental Agreements
These are specifically designed for leasing out properties for business or commercial activities—such as office spaces, retail stores, or warehouses. Since commercial leases often involve high stakes, they tend to be more detailed and flexible compared to residential ones. The agreement must be executed on non-judicial stamp paper, the value of which depends on the rental amount and the duration of the lease, which varies from state to state.
To be legally valid, both parties must sign the agreement. If the lease exceeds 11 months, registration with the local sub-registrar is mandatory. Typical clauses include usage restrictions, rent escalation, sub-letting permissions, and termination conditions. It is advisable to consult a legal professional to ensure compliance with commercial tenancy laws and tax obligations.
2. Residential Rental Agreements
This is the most common form of rental agreement used when a person or family rents a home, apartment, or flat. It defines the duration of tenancy, rent amount, security deposit, maintenance duties, and rules of occupancy. These agreements are usually made for 11 months to avoid the registration requirements under the Registration Act, 1908. However, for longer-term arrangements, registration is necessary to make the document enforceable in court.
3. Single Room Rental Agreements
These are suitable for tenants renting just a single room in a larger dwelling—common among students or working professionals. It ensures clarity about shared spaces (like kitchens or washrooms), visitor policies, and rent contributions. Privacy concerns and individual responsibilities are typically outlined to avoid disputes between cohabitants and landlords.
4. Shared Rental Agreements
Ideal for friends or colleagues renting a house together, this type of agreement involves multiple tenants co-signing the same document. It clearly divides rent, utilities, and other responsibilities. It’s particularly useful in urban areas where rent is high and people prefer cost-sharing. Shared agreements may also include clauses for individual exit or substitution of a tenant during the tenancy period.[2]
BREACH OF RENT AGREEMENT: LEGAL REMEDIES AVAILABLE
Despite clear documentation, breaches can occur—such as non-payment of rent, illegal subletting, property damage, or unauthorized use of the premises. Fortunately, Indian law provides several remedies for both landlords and tenants in such cases.
- For Landlords
- Eviction Suit: If a tenant defaults on rent or violates agreement terms, landlords can initiate eviction proceedings under state-specific Rent Control Acts.
- Recovery of Dues: A civil suit may be filed to recover unpaid rent or compensation for damage to the property.
- Legal Notice: A formal legal notice can be served as a prerequisite to litigation, warning the tenant to comply or face action.
- For Tenants:
- Relief Against Illegal Eviction: If a landlord tries to evict a tenant without following due legal process, the tenant can approach the Rent Controller or court for relief.
- Claim for Refund: In cases where the landlord refuses to return the security deposit without valid reasons, tenants can seek refund through civil remedy.
- Injunction: Tenants may seek an injunction to prevent the landlord from interfering with their lawful possession of the property.
- Mutual Dispute Resolution: Rent disputes can often be settled through alternative dispute resolution methods like mediation or arbitration, especially when both parties want to avoid lengthy court processes.
ESSENTIALS IN A RENT AGREEMENT
- When entering into a rental agreement, both tenants and landlords are generally required to submit certain documents. These typically include valid photo ID (such as an Aadhaar card, passport, or driver’s license), proof of address (like utility bills or official government documents), and recent passport-sized photographs. However, the exact requirements can vary based on the state or city where the agreement is being made. To ensure compliance with local regulations, it’s wise to consult a legal expert who can offer guidance tailored to your location.
- A rental agreement should clearly state the full names and addresses of both the landlord and the tenant. To make it legally valid, both parties must sign the document. It should also mention the monthly rent, any additional fees, and the terms related to the security deposit, including the amount and conditions for refund. The agreement must specify the duration of the tenancy, including the start and end dates. It should outline the landlord’s duties, such as making repairs and maintaining the property, as well as their right to enter the premises when necessary. Similarly, the tenant’s responsibilities—like keeping the property clean, maintaining it properly, and ensuring their right to privacy—should be clearly mentioned.
- The stamp duty you need to pay varies depending on the city where your rental agreement is being registered. This fee is typically paid by buying a stamp paper of the required value. For instance, in Delhi, you’ll pay around 2% of the average yearly rent if your lease is for up to five years. In Noida, agreements lasting up to 11 months also attract a 2% duty on the annual rent. It’s a good idea to include this cost in your overall rental budget.[3]
COMMON PITFALLS TO AVOID IN A RENTAL AGREEMENT
A rental agreement serves as the legal backbone of any landlord-tenant relationship, outlining the rights and responsibilities of both parties. However, certain oversights during its drafting can result in unnecessary conflicts. Here are some key issues to watch out for:
- Failure to Register the Agreement – If the rental agreement isn’t registered, especially for long-term leases, it may carry little weight in legal disputes. Registration helps protect both parties.
- Unclear or Missing Provisions – Vague terms related to rent, maintenance, or the return of the security deposit can lead to misunderstandings. It’s important to spell out these terms clearly.
- Inaccurate Personal or Property Details – Errors like misspelled names, incorrect addresses, or missing ID information can cause legal issues. Double-check all such details.
- No Rent Increase Clause – If the agreement doesn’t mention how and when rent will increase, disagreements can arise later. It’s wise to specify both the frequency and percentage of hikes.
- Undefined Maintenance Duties – Clearly outline who handles repairs, pays for utilities, and manages upkeep to avoid disputes.
- Ambiguous Notice Period – Without a defined notice period for vacating the premises, either party may face unexpected inconvenience. A typical range is one to three months.
- Lack of Security Deposit Guidelines – Specify the terms for refunding the deposit and any deductions for damages to avoid confusion at the end of the lease.
- Ignoring Subletting and Guest Policies – Failing to address subletting rights or visitor limitations can result in unauthorized use of the property.[4]
BREACH OF RENT AGREEMENTS
When either a tenant or landlord fails to meet the responsibilities laid out in a rental contract, it’s considered a breach of the agreement. These violations can lead to serious legal and financial consequences for both sides. It’s important to be aware of what counts as a breach, what it might lead to, and the options available to resolve such disputes.
Typical Breaches You Should Know
- Missed Rent Payments: Consistently failing to pay rent—especially for several months in a row—can give landlords grounds to start eviction proceedings in many areas.
- Unauthorized Use or Subletting: Letting someone else live on the property or using it for an unapproved purpose without the landlord’s permission can violate the agreement.
- Damaging the Property: Significant or deliberate damage that goes beyond everyday wear and tear is another common reason for legal action.
- Breaking Local Laws: Using the rented space in ways that go against local laws or municipal codes may also result in the lease being terminated.
Consequences of Violating a Rental Agreement
- Eviction: If key terms are broken—like skipping rent or damaging the property—the landlord can start the legal eviction process, usually beginning with a formal notice.
- Legal Claims: The affected party may take the matter to court to recover losses or seek compensation, which can be stressful and time-consuming for everyone involved.
- Financial Repercussions: Tenants might have to pay for the remaining lease period or cover the cost of repairs. Security deposits may also be withheld to offset damages.
- Credit and Housing Issues: Serious breaches can harm a tenant’s credit score and hurt their chances of renting in the future.
- Lease Termination: Landlords can legally cancel the agreement and reclaim the property, provided they follow the proper legal steps.[5]
LEGAL REMEDIES FOR BREACH OF RENT AGREEMENTS
When either a landlord or tenant violates the terms of a rental agreement, Indian law offers several legal options to protect the affected party and resolve the dispute fairly. The remedies available depend on how serious the breach is and whether it involves residential or commercial property. Some of the main legal measures include:
- Claiming Compensation
If one party suffers financial loss because of the breach, they can claim compensation under Sections 73 and 74 of the Indian Contract Act, 1872. This may cover unpaid rent, repair expenses, or losses caused by early lease termination. Courts can also grant interest on delayed payments or direct the return of security deposits.
- Specific Performance Orders
Sometimes, money alone isn’t enough to make things right. In such cases, under Section 20 of the Specific Relief Act, 1963, courts can direct a party to carry out their contractual duty—like asking a tenant to move out or requiring a landlord to hand over possession.
- Injunctions to Prevent Further Breach
Courts may issue injunctions to stop ongoing or future violations. For instance, a landlord might seek to block unauthorized changes to the property, or a tenant might try to prevent a forceful eviction.[6]
- Termination and Eviction
If a tenant breaks major terms—such as not paying rent or misusing the property—the landlord can terminate the lease and reclaim the premises. This usually involves issuing a legal notice that outlines the breach and gives time to fix it. If unresolved, the landlord can move to court for eviction.
- Formal Notices to Remedy the Breach
Before going to court, the aggrieved party usually sends a written notice explaining the issue and giving the other side a chance to correct it. If the problem isn’t addressed within the notice period, legal steps may follow.
- Using Arbitration or ADR Methods
Many commercial lease agreements include arbitration clauses, allowing disputes to be settled outside court under the Arbitration and Conciliation Act, 1996. This process is usually faster and more private.
- Safeguards for Tenants
Tenants have legal protection from illegal eviction and must be given proper notice before termination. If a landlord tries to evict a tenant without following due process, the tenant can take the matter to court and may receive compensation for wrongful eviction.
- Court Proceedings and Legal Enforcement
If informal efforts don’t resolve the dispute, either party can go to court seeking eviction, damages, injunctions, or enforcement of terms. Civil courts and rent tribunals handle these matters to uphold legal rights and obligations.[7]
CONCLUSION
In a fast-growing and urbanizing country like India, rental agreements have become essential for maintaining a fair and secure relationship between landlords and tenants. When carefully written, registered, and followed, these agreements help build trust and clarity in property transactions. Still, even with well-defined legal rules, disputes are common—ranging from unpaid rent to unauthorized use or sudden evictions.
To deal with such issues, Indian law offers several solutions, including eviction proceedings, claims for compensation, court injunctions, and even out-of-court options like arbitration. Tenants are protected against illegal eviction and unfair withholding of security deposits, showing the courts’ focus on upholding housing rights. At the same time, landlords can rely on legal tools to recover overdue rent or take back misused property, ensuring their interests are also safeguarded.
The best way to prevent conflicts is through careful planning—by drafting clear agreements, setting out each party’s responsibilities, and following legal processes. Whether the property is for living or business purposes, both landlords and tenants should enter the arrangement with mutual respect and legal understanding, helping ensure that any disagreements are handled fairly and within the law.
[1] Mayashree Acharya, Rent Control Act – Rental Agreement, Rights of Tenant & Landlord,Clear, (April 29th, 2025), Rent Control Act – Rental Agreement, Rights of Tenant and Landlord
[2] Your Complete Guide to Rental Agreements in India, (February 19, 2025), Complete Guide to Rental Agreements in India June 2025
[3] Dhwani Meharchandani, All you need to know about rent agreements, Housing.com, (March 20, 2025), All about a rent agreement: Significance, format, sample and more
[4] Vivek, Mistakes to Avoid in Your Rental Agreement, The NoBroker Times, (January 31, 2025), Mistakes To Avoid In Your Rental Agreement In 2025
[5] Sunisha Naik, What are the consequences of breaking the terms and conditions of a rent/lease agreement in India?, (June 14, 2025), What are the consequences of breaking the terms and conditions of a rent/lease agreement in India?
[6] What are the Legal Tenant Rights in India, Legal eye, What Are The Legal Tenant Rights In India – Legal Eye
[7] Raizada Law Associates, Legal Remedies for Breach of Commercial Property Lease Agreements in India, (July 4, 2024), Legal Remedies for Breach of Commercial Property Lease Agreements | 2024 RLA
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