Chapter II REGULATION OF RENT

Registration of tenancy agreement.-

1. (1) Notwithstanding anything contained in section 107 of the Transfer of Property Act, 1882 (Central Act 4 of 1882), no person shall, after the commencement of this Act, let or take on rent any premises except by an agreement in writing.
2. (2) Every agreement referred to in sub-section
3. (1) or required to be registered under sub-section
4. (3) shall be registered under the Registration Act, 1908 (Central Act 16 of 1908), within such period as may be prescribed and for this purpose the agreement shall be deemed to be a document for which registration is compulsory under section 17 of the said Act.
5. (3) Where, in relation to a tenancy created before the commencement of this Act,-
   • (a) an agreement in writing was entered into and was not registered under the Registration Act, 1908 (Central Act 16 of 1908) the landlord and the tenant shall, jointly present a copy thereof for registration before the registering officer under the said Act;
   • (b) no agreement in writing was entered into, the landlord and the tenant shall enter into an agreement in writing with regard to that tenancy and present the same for registration before the registering officer under the said Act: Provided that where the landlord and the tenant fail to present jointly a copy of tenancy agreement under clause
   • (a) or fail to reach an agreement under clause
   • (b) such landlord and the tenant shall separately file the particulars about such tenancy with the prescribed authority in such form and in such manner and within such period as may be prescribed.

Inheritability of tenancy.-

1. (1) In the event of death of a tenant, the right of tenancy shall devolve for a period of ten years from the date of his death to his successors in the following order, namely:-
   • (a) spouse;
   • (b) son or daughter or where there are both son and daughter both of them;
   • (c) parents;
   • (d) daughter-in-law, being the widow of his pre-deceased son: Provided that the successor has ordinarily been living or carrying on business in the premises with the deceased tenant as a member of his family up to the date of his death and was dependent on the deceased tenant: Provided further that a right to tenancy shall not devolve upon a successor in case such successor or his spouse or any of his dependent son or daughter is owning or occupying a premises in the local area in relation to the premises let.
2. (2) If a person, being a successor mentioned in sub-section (1), was ordinarily living in or carrying on business in the premises with the deceased tenant but was not dependent on him on the date of his death, or he or his spouse or any of his dependent son or daughter is owning or occupying a premises in the local area in relation to the premises let to which this Act applies such successor shall acquire a right to continue in possession as a tenant for a limited period of one year from the date of death of the tenant; and, on the expiry of that period, or on his death, whichever is earlier, the right of such successor to continue in possession of the premises shall become extinguished. Explanation.- For the removal of doubts, it is hereby declared that,-
   • (a) where, by reason of sub-section (2), the right of any successor to continue in possession of the premises becomes extinguished, such extinguishment shall not affect the right of any other successor of the same category to continue in possession of the premises but if there is no other successor of the same category, the right to continue in possession of the premises shall not, on such extinguishment, pass on to any other successor specified in any lower category or categories, as the case may be;
   • (b) the right of every successor, referred to in sub-section
3. (1) to continue in possession of the premises shall be personal to him and shall not, on the death of such successor, devolve on any of his heirs.

Rent payable.-

1. (1) The rent payable in relation to a premises shall be,-
   • (a) the rent agreed to between the landlord and the tenant as enhanced in the manner provided in the Third Schedule; or
   • (b) the standard rent specified under section 7, as revised under section 9.
2. (2) In the case of a tenancy entered into before the commencement of this Act, the landlord may, by notice in writing to the tenant within three months from the date of such commencement, enhance the rent as specified under section 7, and the rent so enhanced, shall be payable from the date of such commencement.

Standard rent.-

1. (1) Standard rent in relation to any premises, shall be the rent calculated on the basis of ten per cent per annum of the aggregate amount of the cost of construction and the market price of the land comprised in the premises on the date of commencement of the construction: Provided that the standard rent calculated as aforesaid shall be enhanced in the manner provided in the Third Schedule.
2. (2) For the purpose of this section,-
   • (a) cost of construction shall include cost of electrical fittings, water pumps, overhead tanks, storage tank and other water, sewerage and other fixtures and fittings affixed in the premises;
   • (b) in case any fixture and fittings referred to in clause
   • (a) are in common use by more than one occupant in a building, such proportion of cost of the fixtures equipment and fittings shall be included in the cost of construction of the premises as bears proportion to the plinth area of such premises to the plinth area of that building;
   • (c) the cost of construction shall be the actual amount spent on construction, and in a case where such amount cannot be ascertained, such cost shall be determined as per the scheduled rates of the State Public Works Department for cost of construction for similar construction for the year in which the premises was constructed;
   • (d) the market price of the land shall be the price for which the land was bought as determined from the deed of sale registered under the Registration Act, 1908 (Central Act 16 of 1908), if construction commenced in the year of registration or the land rates notified by the State Government or a local authority for the year in which construction was commenced, whichever is higher;
   • (e) the land comprised in the premises shall be the plinth area of the building and such of the vacant land up to fifty per cent, of the plinth area as is appurtenant thereto;
   • (f) in a case where a premises forms part of a building having more than one premises, such proportion of price of land forming part of such building shall be taken to be the market price of the land comprised in the premises as is equal to the proportion of the plinth area of such premises to the plinth area of that building;
   • (g) notwithstanding anything contained in clauses
   • (c) and (d), the cost of construction and the market price of the land comprised in the premises purchased from or allotted by the Government or a local authority shall be the aggregate amount payable to such Government or the local authority for the premises: Provided that the Controller may, for the purpose of arriving at, the cost of construction and the market price of the land comprised in the premises, allow in addition, subject to a maximum of thirty per cent of amount payable to the Government or the local authority, to the amount so payable for any expenditure incurred by the landlord or by the first or any subsequent purchaser or allottee for any improvement, addition or structural alteration in the premises.

Other charges payable.-

1. (1) A tenant shall be liable to pay to the landlord, besides the rent, the following charges, namely:-
   • (a) charges, not exceeding fifteen per cent of the rent for the amenities as specified in the Fourth Schedule or as agreed to between the landlord and the tenant;
   • (b) maintenance charges at the rate of ten per cent of the rent;
   • (c) without prejudice to the liability of landlord to pay the property tax to the local authority, the prorata property tax in relation to the premises. Explanation.- For the purpose of calculating the monthly charges payable by the tenant to the landlord towards the property tax, the amount paid or payable as property tax for the immediately preceding year or the estimated tax payable shall form the basis.
2. (2) The landlord shall be entitled to recover from the tenant the amount paid by him towards charges for electricity or water consumed or other charges levied by a local or other authority which is ordinarily payable by the tenant.

Revision of rent in certain cases.-

1. (1) Where a landlord has at any time, before the commencement of this Act with or without the approval of the tenant or after the commencement of this Act with the written approval of the tenant incurred expenditure for any improvement, addition or structural alteration in the premises, not being expenditure on decoration or tenantable repairs necessary or usual for such premises, and the cost of that improvement, addition or alteration has not been taken into account in determining the rent of the premises, the landlord may lawfully increase the rent per year by an amount not exceeding ten percent of such cost.
2. (2) Where, after the rent of a premises has been fixed under this Act, or agreed upon, as the case may be, there has been a decrease, diminution or deterioration of accommodation in such premises, the tenant may claim a reduction in the rent.

Notice of revision of rent.-

1. (1) Where a landlord wishes to revise the rent of any premises under sub-section
2. (1) of section 9, he shall give the tenant a notice of his intention to make the revision and, in so far as such revision is lawful under this Act, it shall be due and recoverable from the date of improvement, addition or structural alteration.
3. (2) Every notice under sub-section
4. (1) shall be in writing signed by or on behalf of the landlord and given in the manner provided in section 106 of the Transfer of Property Act, 1882 (Central Act 4 of 1882).

Unlawful charges not to be claimed.-

1. (1) It shall not be lawful for the tenant or any other person acting or purporting to act on behalf of the tenant or a sub-tenant to claim or receive any payment in consideration of the relinquishment, transfer or assignment of his tenancy or sub-tenancy, as the case may be of any premises.
2. (2) Nothing in this section shall apply,-
   • (a) to any payment made in pursuance of an agreement entered into before the commencement of this Act;
   • (b) to any payment made under an agreement by any person to a landlord for the purpose of financing the construction of the whole or part of any premises on the land belonging to, or taken on lease by, the landlord if one of the conditions of the agreement is that the landlord should let to that person the whole or part of the premises when completed for the use of that person or any member of his family but not exceeding the amount of agreed rent for a period of five years, for the whole or part of the premises to be let to such person. Explanation.- For the purpose of clause
   • (b) of this sub-section, a member of the family of a person means, in the case of an un-divided Hindu family, any member of the joint family of that person and in the case of any other family, the husband, wife, son, daughter, father, mother, brother, sister or any other relative dependent on that person.

Controller to fix standard rent, etc.-

1. (1) The Controller shall, on an application made to him in this behalf, in the prescribed manner, fix in respect of any premises,-
   • (i) the deemed rent for the purpose of clause
   • (e) of sub-section
2. (3) of section 2;
   • (ii) the enhancement in rent in the manner provided in Third Schedule;
   • (iii) the standard rent as per the provisions of section 7;
   • (iv) the other charges payable as per the provisions of section 8; and
   • (v) the revision in rent as per the provisions of section 9: Provided that it shall not be permissible for the land lord to apply for the fixation of standard rent as per the provisions of section 7 in the case of a tenancy entered into after the commencement of this Act.
3. (2) In working out the cost of construction of any premises or the market price of land comprised in such premises for the purposes of section 7 or the expenditure in-curred for any improvement, addition or structural alteration or the decrease, diminution or deterioration of accommodation in a premises for the purpose of section 9, the Controller may take the assistance of a prescribed valuer who shall carry out the assessment in the manner prescribed.
4. (3) In fixing the standard rent of any premises or the lawful increase or decrease of the rent or determining the other charges payable, the Controller shall fix or determine an amount which appears to him to be reasonable having regard to the provisions of section 7 or section 8 or section 9 and other circumstances of the case.
5. (4) In fixing the standard rent of any premises part of which has been lawfully sub-let, the Controller may also fix the standard rent of such part sub-let.
6. (5) Where for any reason it is not possible to determine the standard rent of any premises on the principles set forth in section 7, the Controller may fix such rent as would be reasonable having regard to the situation, locality and condition of the premises and the amenities provided therein, and where there are similar or nearly similar premises in the locality, having regard also to the rent payable in respect of such premises.
7. (6) The standard rent shall in all cases be fixed for a tenancy of twelve months: Provided that where any premises are let or re-let for a period of less than twelve months, the standard rent for such tenancy shall bear the same proportion to the annual rent as the period of tenancy bears of twelve months.
8. (7) In fixing the standard rent of any premises under this section, the Controller shall fix the standard rent thereof in an unfurnished state and may also determine an additional charge to be payable on account of any fittings or furniture supplied by the landlord and it shall be lawful for the landlord to recover such additional charge from the tenant.
9. (8) In fixing the standard rent or lawful increase or decrease of rent or determining the other charges payable in respect of any premises under this section, the Controller shall specify a date from which the amount, so fixed shall be deemed to have effect: Provided that, in no case the date so specified shall be earlier than the date of filing of the application for the increase or decrease of the standard rent: Provided further that if the increase is because of improvement, addition or structural alteration, it shall come into effect from the date of completion of such improvement, addition or alteration.
10. (9) The Controller may, while fixing standard rent or lawful increase or decrease in rent or other charges payable, order for payment of the arrears of amount due by the tenant to the landlord in such number of instalments as he deems proper.

Fixation of interim rent.- When an application for fixing the standard rent or for determining the lawful increase or decrease of such rent and other charges payable is made under section 12, the Controller shall, as expeditiously as possible, make an order specifying the amount of the rent and other charges payable or the lawful increase to be paid by the tenant to the landlord pending final decision on the application and shall specify the date from which the rent and other charges payable or lawful increase so specified shall be deemed to have effect.

Limitation for application for fixation of standard rent etc.- Any landlord or tenant may file an application to the Controller for fixing the standard rent and other charges of the premises or for determining the lawful increase or decrease of such rent and other charges:-

1. (a) in the case of any premises which were let, or in which the cause of action for lawful increase or decrease of rent and other charges arose, before the commencement of this Act, within two years from such commencement.
2. (b) in the case of any premises in which the cause of action for lawful increase or decrease of rent and other charges arises after the commencement of this Act, within two years from the date on which the cause of action arises.
3. (c) in the case of any premises constructed on or after the commencement of this Act and for which the provisions of the Act are made applicable by virtue of sub-section

1. (4) of section 2, within two years from the date of such application: Provided that the Controller may entertain the application after the expiry of the said period of two years, if he is satisfied that the applicant was prevented by sufficient cause from filing the application in time.

Refund of rent, premium, etc.,.- Where any sum or other consideration has been paid, whether before or after the commencement of this Act, by or on behalf a tenant to a landlord, in contravention of any of the provisions of this Act the Controller may, on an application made to him within a period of one year from the date of such payment, order the landlord to refund such sum or the value of such consideration to the tenant or order adjustment of such sum or the value of such consideration against the rent payable by the tenant.

Receipt to be given for rent and other charges paid.-

1. (1) Every tenant shall pay rent and other charges payable within the time fixed by contract or in the absence of such stipulation, by the fifteenth day of the month next following the month for which it is payable and where any default occurs in the payment of rent or other charges, the tenant shall be liable to pay simple interest at the rate of twelve per cent per annum from the date on which it becomes payable.
2. (2) Every tenant who makes payment of rent or other charges payable or advance towards such rent or other charges to his landlord shall be entitled, to obtain forthwith from the landlord or his authorised agent a written receipt for the amount paid to him, signed by the landlord or his authorised agent: Provided that it shall be open to the tenant to remit the rent or other charges to his landlord by postal money order.
3. (3) If the landlord or his authorised agent refuses or neglects to pass to the tenant the receipt referred to in sub-section (2), the Controller may, on an application made to him in this behalf by the tenant within two months from the date of payment and after hearing the landlord or his authorised agent, by order direct the landlord or his authorised agent to pay to the tenant, by way of damages, such sum not exceeding double the amount of rent or other charges paid by the tenant and the costs of the application and shall also grant a certificate to the tenant in respect of the rent or other charges paid.
4. (4) If the landlord or his authorised agent refuses to accept or evades acceptance of receipt of rent or other charges payable to him, the tenant may, by notice in writing, ask the landlord to furnish him the particulars of his bank account in a bank in the place where the premises is situate into which the tenant may deposit the rent and other charges payable to the credit of the landlord.
5. (5) If the landlord furnishes the particulars of his bank account, the tenant shall deposit the rent and other charges payable in such bank account from time to time.
6. (6) If the landlord does not furnish the particulars of the bank account under sub-section (4), the tenant shall remit the rent and the other charges payable to the landlord from time to time through postal money order after deducting the postal charges.