What is MP's new tenancy act aims to end landlord-tenant disputes

The Madhya Pradesh government will introduce a new Tenancy Model Act to resolve disputes between tenants and landlords while safeguarding their rights. The draft bill from the Urban Development and Housing Department will be presented in the upcoming winter session starting December 16. The law will replace the 14-year-old Tenancy Act of 2010, addressing the rising number of tenancy-related issues in the state.

Why the change is necessary?

Madhya Pradesh has seen significant demographic changes over the past two decades. According to the 2011 Census, the population grew from 6.03 crore in 2001 to 7.26 crore in 2011, and is expected to increase by 27% by 2030. Despite many vacant homes, many families lack adequate housing. Urban migration has increased demand for rental properties, straining housing availability.

Experts argue that these factors necessitate a comprehensive law to govern landlord-tenant relations in the state.

Key provisions in new act

For Tenants:

1. Non-vacation of premises: If tenants refuse to vacate the property after the tenancy agreement ends, they will pay double rent for the first two months and four times the rent from the third month onward.

2. Advance payment: Tenants must pay two months' advance for residential properties and six months for commercial properties.

3. No subletting: Tenants cannot rent out the property to others.

4. Maintenance: Tenants will maintain certain property aspects, such as plumbing, electrical fixtures, and drain cleaning.

For Landlords:

1. No service disconnection: Landlords cannot cut off essential services like water, electricity, gas, and sanitation.

2. Vacating procedure: Landlords must seek approval from the competent authority to evict tenants before the lease expires.

3. Return of security deposit: landlords must return the tenant's security deposit on the same day the property is vacated.

4. Rent increase: The Rent Authority must approve any rent increase and will need the tenant's consent.

Shared Responsibilities:

1. Legal agreements: Each tenancy agreement must be in writing, with one copy belonging to the landlord and the other to the tenant.

2. Repairs: The tenant and landlord will be responsible for normal wear-and-tear repairs. If one party refuses repairs, the other can deduct the cost from the rent or security deposit.

Differences between old and new act

The old Tenancy Act applied only to cities and townships. The new Act will extend to the entire state, addressing rental disputes in rural and urban areas. It includes provisions for a Rent Tribunal and Rent Court to handle disputes, replacing the civil court approach.

Another key change is the regulation of property agents. The new Act will recognize property agents as legal entities, requiring them to register with the authorities. Additionally, landlords outside the state can appoint property managers to handle their rental properties.

The new Act extends the rules for transferring tenancy agreements to heirs in the event of death, previously applicable only to tenants.

Under the new Act, tenancy disputes will no longer be resolved in civil courts. The Rent Tribunal and Rent Court will handle all cases. A Rent Authority will be appointed in each district, and the District Judge will preside over the Tribunal. If an agreement is made between the tenant and landlord, it must be reported to the Rent Authority within 60 days.

Experts believe these new provisions will streamline the dispute resolution process, reducing the burden on the courts.

Impact on the Rental Market

The new Tenancy Model Act addresses long-standing issues tenants and landlords face. High Court lawyer Sanjay Verma explains that tenancy disputes often involve tenants refusing to vacate properties or landlords not returning security deposits. Verma is optimistic that the new Act will reduce disputes by providing clearer guidelines and protection for both parties.

With more people seeking rental properties, the government hopes the new rules will encourage more landlords to rent their properties without legal entanglements, while protecting tenant rights.

Provisions in the new act

• For Tenants:

  • Pay double rent if they don’t vacate the property on time.

  • Advance payment for residential and commercial properties.

  • No subletting.

• For Landlords:

  • Cannot cut off essential services.

  • Must seek eviction approval.

  • Must promptly return the security deposit.

• For Both:

  • All agreements will be legally binding.

  • Both parties will share repair responsibilities.

  • Disputes will be handled by rent tribunals and rent courts.

The introduction of the Tenancy Model Act in Madhya Pradesh is a significant step toward resolving landlord-tenant disputes.

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