DEAR JEEVESH MEHTA,
Leases for periods less than a year OR 11 Months do not require registration.
The Transfer of Property Act mandates that lease deeds for a period of more than one year should be registered.
LEASES FOR LESS THAN A YEAR:
The best practice is to enter into a lease deed for a period of 11 months with a conditional option to renew it at the end of that period by another 11 months, provided certain conditions are fulfilled. Such leases should also be properly stamped. The stamp duty is about 5% of the total amount of rent payable under such a lease. This duty is applicable even to an agreement of lease. However under stamping of a lease agreement or lease deed does not by itself make the lease void. In case of dispute, the court will demand that the excess stamp duty be paid along with penalty prior to hearing the case.
THE REGISTRATION ACT, 1908
ACT NO. 16 OF 1908 1*
OF REGISTRABLE DOCUMENTS
17. Documents of which registration is compulsory.
(1) The following documents shall be registered, if the property to which they relate is situate in a district in which, and if they have been executed on or after the date on which, Act No.1864 ( XVI of 1864), or the Indian Registration Act, 1866 (20 of 1866), or the Indian Registration Act, 1871 (8 of 1871), or the Indian Registration Act, 1877 (3 of 1877), or this Act came or comes into force, namely –
(d) leases of immovable property from year to year, or for any term exceeding one year, or reserving a yearly rent;