• Registered rental agreement

Is it possible to include a "damages" clause in a registered rental agreement? I am trying to add a clause which states that the tenant will have to pay Rs 10000 per day for each extra day overstayed after expiration of notice period (or rental agreement). The intention is to prevent the tenant from going to court. This strategy will help "quantify" damages and not leave it to the judge (court) to award meager damage amounts of 5000 or 10000 rupees.

If the above is not possible, how to control a tenant through contract or tort law? What about escrow accounts or other schemes to guarantee that a misbehaving tenant gets proper monetary punishment.
Asked 5 years ago in Property Law
Religion: Muslim

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12 Answers

you can incorporate clause for payment of penal rent

2) if he fails to vacate in spite of notice tenant shall be liable to pay Rs 2000 per day for refusal to vacate the premises on expiry or termination of rental agreement

Ajay Sethi
Advocate, Mumbai
94520 Answers
7485 Consultations

5.0 on 5.0

If Tenant over stay, is a month to month tenancy created. If so, landlord could charge an extra month's rent.

Mohammed Mujeeb
Advocate, Hyderabad
19299 Answers
32 Consultations

4.7 on 5.0

You cannot mention such kind of penalty in rent agreement. You have the option to file eviction suit after sending proper legal notice to the tenant after end of the agreement.

Abhilasha Wanmali
Advocate, Nagpur
1021 Answers
1 Consultation

4.8 on 5.0

1. Making of any clause if not supported by law does not give any legal enforceability.

2. A tenant even after expiry of rental agreement or termination of tenancy is considered as statutory tenant and he is protected by the local Rent Act.

3. So if the teannt does not quit r vacate the tenanted premises even after termination of tenancy , then filing of eviction suit is the only option. No amount of damage clause would give any added advantage.

Devajyoti Barman
Advocate, Kolkata
22777 Answers
484 Consultations

5.0 on 5.0

1. The mentioned clause can be incorporated in the Tenancy /Lease agreement, since there is nothing illegal about, provided it is worded appropriately and accepted by the Tenant.

2. The wordings may be:

a) Rent from period 1-1-18 to 1-10-18 shall be 100/-

b) Rent from period 1-10-18 onwards shall be 200/- till the Flat is vacated and duly acknowledged.

3. Agreement is a Contract and legally enforceable in a court of law.

Keep Smiling .... Hemant Agarwal

Hemant Agarwal
Advocate, Mumbai
5612 Answers
25 Consultations

5.0 on 5.0

Firslty, when two parties are entering into an contract then it is open to the accepting side to get agreed to all clauses or not.

Secondly, there is no problem to put such clause as long as the other parties get agreed to it.

Thirdly, but, still the clause should be such which depicts only to save yourself from some damgesnot unnecessarily putting burden in the other side.

Fourhtly, as it may treat as arbitary to the extent that the damages will be more the it actually causes you.

Sanjay Baniwal
Advocate, South Delhi
5473 Answers
13 Consultations

5.0 on 5.0

Sir for this since the agreement is made a supplementary agreement is required to made and registered with the tenant adding this condition to already registered agreement.

Escrow is third party account to disburse funds in your case it wont be of any use it is used in real estate sell and purchase transaction when third financing party is there.

Shubham Jhajharia
Advocate, Ahmedabad
25514 Answers
179 Consultations

5.0 on 5.0

Yes the penal rent is above the rent agreed this is contractual relationship there is no specific provision as such to make agreement for penal rent but since the landlord and the tenant share contractual relationship such condition can be added in contract and the tenant has to abide by it.

Shubham Jhajharia
Advocate, Ahmedabad
25514 Answers
179 Consultations

5.0 on 5.0

1. Kindly do not use the words "Penal Rent", since such words will create grounds for dispute.

2. Just simply state the Rent rates payable, for respective periods. This will be good contract terms and irrevocable, IF agreed by both the parties.

Keep Smiling .... Hemant Agarwal

Hemant Agarwal
Advocate, Mumbai
5612 Answers
25 Consultations

5.0 on 5.0

In the registered rental agreement you may include any clause but what is legally enforceable is to be seen by scrutinisation of the agreement.

Your conditions or wishes cannot be enforced in law if ther are not reasonable or justified.

The exorbitant demand in the name of agreement may not be tenable in law.

Precaution is always better but it should not become an excess of abuse of law in the name of precaution

T Kalaiselvan
Advocate, Vellore
84711 Answers
2172 Consultations

5.0 on 5.0

While each house rent or lease agreement has its unique situations that can merit unique terms and conditions to be inserted in a contract, there are some crucial terms that should almost always be included in agreements to protect their interests and prevent future misunderstandings that could potentially lead to trouble, disputes, financial losses or litigation.

In case of tenancy as well as lease, the right to use the property gets transferred from the owner to the person who is renting out the place. However, no such transfer of right to use takes place in leave and license agreements.

Due to the difficulty of getting a tenant or a leaseholder to vacate a place, most landlords prefer to enter into a leave and license agreement for a contractually specified period after which the licensee is obligated to vacate the premises. Under a leave and licence, the amount of rent (and increases in rent in case of renewal of the agreement) can be contractually determined by parties.

Sometimes, the security deposit is adjusted against the last few months rent – which should also be specified in the agreement. The consequences in case of delay in payment, usually penal interest in the range of 12 to 18% p.a., in case there is more than 10 days of delay, can also be specified.

T Kalaiselvan
Advocate, Vellore
84711 Answers
2172 Consultations

5.0 on 5.0

1. You can add this clause. Subject to the willingness of the tenant any clause can be added, unless it is opposed to public policy, but how will you enforce it. The tenant will not pay 10,000 per day for overstaying. Eventually you will have to approach the court to recover the amount.

2. There can be no injunction against the tenant which would prevent him from approach the competent court for his legal remedies. Any clause in the rent agreement which abrogates or curtails the legal remedies of the tenant would be opposed to public policy and provisions of Indian Contract Act, hence unenforceable.

3. In India the courts award mesne profits instead of penal rent. Liquidated damages can be recovered by you if a clause is made to that effect in the rent agreeement. It is not dependent on the nature and size of the property.

Ashish Davessar
Advocate, Jaipur
30763 Answers
972 Consultations

5.0 on 5.0

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