Registration may be must for high-end rent deeds

The government plans to make registration of rent agreements mandatory above a certain threshold, irrespective of the length of the deed.

The government plans to make registration of rent agreements mandatory above a certain threshold, irrespective of the length of the deed.

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This may force tenants to bear the additional burden of registration fees while entering into lease agreements. Legal experts, however, say that tenants will also benefit because registered agreements would have evidential value in a court of law.

Currently, leases under one year are not mandatorily registered. This allows millions of tenants in cities like Delhi to enter into 11-month long, renewable agreements with landlords. But a proposed amendment to the 95-year-old Registration Act says, “Leases below one year but above a specified amount are compulsorily registerable. This amount may be specified by the respective states.”

Among other proposed changes, even power of attorney — a popular route to transfer ownership of properties — will also come under the net of registration as the government aims to mop up more revenue through registration fees.

A cabinet note on the Registration (Amendment) Bill 2013 has been prepared and it may come up for cabinet review next week.