More than two years after the Federal Cabinet approved the… Model Tenancy Law for Trading As for the states and union territories (UTs), only four states have adopted the law aimed at balancing the interests of tenants and landlords, despite reminders from the Ministry of Housing and Urban Affairs (MoHUA), The Indian Express has learnt. The model law, which imposes rental agreements and caps the security deposit on two months’ rent, was expected to release the stock of vacant homes in the rental market by protecting the interests of homeowners. On August 24, the ministry wrote to senior ministers of states and union territories reminding them of the benefits of the model law and asking them to take steps to either enact a law or amend the existing rent law accordingly. This, according to the letter, was the fifth such communication from the ministry to the states and union territories since June 2021, when the Cabinet approved the model law.
“You will be grateful that the MTA strives to balance the rights of tenants and landlords in a transparent and accountable manner, and also has the power to open up vacant buildings to create a vibrant formal rental market to boost the economy,” the ministry said to the states and UTs. The law has been adopted in one form or another only in the states of Assam, Uttar Pradesh, Tamil Nadu and Andhra Pradesh, said ministry officials, who spoke on condition of anonymity. A senior official added that other states had not responded to the reminders sent by the ministry since 2021. In July 2022, the ministry had informed the House of Representatives in its response that only these states had adopted the law. Officials said the number of states has remained the same so far
Tamil Nadu and Andhra Pradesh had enacted their own laws before approving the final FTA – in 2017 and 2018 respectively – with the ministry proposing to scrap old rent control laws and enact new rental laws when it launched the “Housing for All” mission in 2015. and Uttar Pradesh will introduce their laws in 2021 after approving the model law.
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A senior UP government official said the state has set up rent courts (officer of the rank of additional district judge) in all 75 districts, which is one of the provisions of the Uttar Pradesh Tenancy Regulation of Urban Premises Act, 2021. While the model law states that no property can be rented without Inform the rental authority in writing, UP Act makes this mandatory for tenancies of more than 12 months. The official said that most lease contracts are for a period of 11 months, and the state has so far received 206 applications to register lease contracts. An Assam government official said the process of making rules under the law is ongoing and registration of leases will begin only after that.
The rental housing market is expected to boom in the coming years due to rapid urbanization, relocation and rising demand for properties, said Anshuman Magazine, Chairman and CEO of CBRE Real Estate Consultants India, Southeast Asia, Middle East and Africa. Home ownership costs. He said the MTA is expected to streamline this sector by providing a legal framework. “Except for the four states, the pace of adoption of the law remains slow among other states. The government’s push to encourage states for faster adoption of MTA is crucial to streamline the sector,” he said.
The Model Rent Law stipulates that properties must be rented after signing a lease contract that includes the rental period, an agreed-upon rent increase, and a fixed security deposit (up to two months’ rent for residential and six months’ rent for non-residential advances). These agreements must be submitted to the leasing authorities (officers of the rank of Deputy Collector) for approval. The Act establishes Tenancy Tribunals, appoints an officer of the rank of ADM by the District Magistrate, Tenancy Tribunals, District Magistrate or Additional District Magistrate appointed by the State Government in consultation with the High Court, to resolve disputes. In the event of a dispute, the Tenancy Tribunal can decide to reconsider the rent, evict, request takeover of the premises etc. The matter can be appealed before the Tenancy Tribunal.
