Room Rent: Many people are now renting or living in rented houses. In both the cases of renting or renting the house, the agreement is for 11 months. Have you ever wondered why the rent agreement is for 11 months instead of 12 months? We will try to answer this question in today’s article.
Know the reasons behind this
As per the requirements of Section 17 of the Registration Act, 1908, a lease agreement for a period of more than one year is not compulsorily registerable. This means that rental contracts of less than 12 months can be made without any difficulty. This option helps both the landlord and the tenant to avoid the cumbersome process of registering the documents at the sub-registrar’s office and paying the registration charges. The rate of stamp duty for an 11-month lease is usually lower than the stamp duty levied for a lease of more than one year. As a result, the costs are lower. Neither the landlord nor the tenant wants to spend extra money.
The 11-month rental agreement is in favor of the landlord in case of cancellation of the contract within a short time. Rent can be increased by the landlord. Also, landlords prefer short-term rental agreements to avoid potential disputes and hassles.
The rules also state that under the Transfer of Property Act and the Registration Act, the requirement of the Registrar of Lease Agreements is taken into account if the lease period is more than one year. Although the notarization requirement is not provided in the rental agreement, it will help maintain transparency between the parties executing the agreement. Currently, it is legal to draft an 11-month notarized rental agreement. If a dispute arises, these agreements can also be presented as evidence. Stamp paper of 100 or 200 rupees is generally used for drafting such rent agreement by the public notary.