Why are the majority of lease contracts in India only 11 months long?

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r64hQAEAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAADADX8BAAHYW5QyAAAAAElFTkSuQmCC Why are the majority of lease contracts in India only 11 months long?

A written rent agreement establishes the rights and responsibilities of the parties and the legal relationship between a landlord and a renter.

Tenants must sign a lease agreement with the landlord for a predetermined period of time in order to live on rent. Typically, 11 months is the time frame that most landlords choose to use. Have you ever questioned why these leases are just for 11 months? This is why.

An article in the Economic Times claims that If the lease is for shorter than a year, there is no need to register. A leasing agreement with a duration of no more than one year is not required to be registered under section 17 of the Registration Act of 1908. This implies that leases less than a year can be signed without registering. If one decides to register the rental agreement, the stamp duty amount is based on the rent and the period of the stay.

The more the stamp duty, the longer the tenure. Therefore, a shorter length will aid in lowering the size of the lump payment that would be paid in stamp duty, even if a rent agreement is registered. Therefore, both parties frequently cooperate so long as it keeps the landlord and renter from having to pay a larger sum of money. Instead of registering their rental agreement, many people opt to get it notarized.

Financial Express said that a leave and licence arrangement, which can only be for a maximum of five years, is a legal notion in the State of Maharashtra. In this case, the licensee is only allowed to occupy the property for the predetermined reasons specified in the agreement with the owner, or licensor. Since the licensee is only given the right to occupy the property for a specific period of time, whereas the lessee is given rights that are better guaranteed by the law, leave and licence agreements are more popular in Maharashtra than lease agreements.

In Delhi, where 11-month leases are more typical than long-term rents, a similar practise is frequent. In the event of a dispute, a registered rental agreement serves as a reliable proof. If there isn’t a registered rent agreement, the landlord can have a hard time getting the tenant to pay for any property damage. According to Kumar, arguments over the eviction notice, lock-in time, premature termination, renewal period, etc. would result from unfavourable outcomes for parties trying to prove their rights under the rent agreement because an unregistered rent agreement is not acceptable in court.

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