Rent agreement

Hello,

As of now there is no law that standardises the safety deposit amount, in many other countries the safety deposit cannot exceed a single month’s rent .

Depending on what amenities a luxury house offers to a tenant, the maintenance of these features and amenities can cost anywhere between Rs 8-50 per sq ft. So, for instance, if the house is spread over 3,000 sq ft, the monthly maintenance will come to Rs 24,000 minimum. A smaller house with regular amenities may not command as much. Hence, security deposits by this logic cannot be standardised. However, the government can intervene and fix a base.

Recent reports claim that activists have been asking a standardisation and that it should be fixed at one to three months of rent. This was after news about landlords asking for 10 months of security deposit surfaced.

Prior to this, there have been instances where verdicts were in favour of the tenant. Consider these:

• In 1996, in the K. Narasimha Rao vs. T.M. Nasimuddin Ahmed case, the bench ruled the following:

“Landlord not to claim or receive anything in excess of fair rent or agreed rent. - (l) Where the Controller has fixed or refixed the fair rent of a building -

(a) the landlord shall not claim, receive, or stipulate for the payment of (i) any premium or other like sum in addition to such fair rent, or (ii) save as provided in Section 5 or Section 6, anything in excess of such fair rent: Provided that the landlord may receive, or stipulate for the payment of,an amount not exceeding one month's rent by way of advance; (the same is true where rent is not fixed)

(b) Save as Provided in clause

(a), any Premium or other like sum or any rent Paid in addition to, or in excess of, such fair rent, whether before or after the date of the commencement of this Act, in consideration of    the grant, continuance or renewal of the tenancy of the building after the date of such commencement, shall be refunded by the landlord to the person by whom it was paid or at the option of such person, shall be otherwise adjusted by the landlord: Provided that where before the fixation or refixation of the fair rent, rent has been paid in excess thereof, the refund or adjustment shall be limited to the amount paid in excess for the period commencing on the date of the application by the tenant or landlord under sub- section (1) of Section 4 of sub- section (3) of Section 5, as the case may be, and  ending with the date of such fixation or refixation.

• In 2015, a small-cases court cited the 1996 verdict in the case of Nimauthullah versus Rajan case where the landlord was asked to refund the excess money after deducting for defaults.

• The Draft Model Tenancy Law of 2015 also read, “Save an agreement to the contrary, it shall be unlawful to charge a security deposit in excess of three times the monthly rent. The security deposit shall be refunded to the tenant within one month after vacation of the premises after making a due deduction of any liability of the tenant.”

• In early 2017, a public interest litigation or a PIL was filed in the Karnataka High Court by an activist but because the petitioner was not sent to the Secretary of Housing, the matter was closed.

source: makaan

Also visit:.

https://www.lawyersclubindia.com/articles/rent-agreement-11787.asp

Thank you