1) there should be penal clause in rental agreement that if tenant fails to vacate premises on expiry of agreement penal rent has to be paid by tenant
2) you are at liberty to carry on construction on said land after tenant vacates the premises
Renting out vacant land to petroleum company for LPG gas station business
Hello Sir, I'm planning to rent out my vacant land to an LPG gas station company. The agreement tenor is for 5 years. Overall land area is about 32000 sqft (Length 400 feet x Width 80 feet). Land area planned to rent out to LPG station is about 8000 sqft (Front facing Road) Please find my queries below. 1) I would like to rent it out only for 5 years exactly, in this case what precautionary steps should I take to ensure that the tenant vacates the land exactly on the term as agreed in the agreement. 2) After completion of the agreement/vacating the land by tenant( after 5 years), is there any restriction/prohibition on construction of new building for commercial or residencial purpose/ or letting out the same space for rent immediately 3) As the front portion of the land is planned to rent out to LPG gas station, I would like to know if there are any restriction / prohibition to build commercial spaces in the remaining area of the property at the backside of the property.
Asked 7 years ago in Property Law
Religion: Hindu
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9 Answers
1. See the pump leases are longer generally though you can prepare a registered lease with the clause that on expiration of 5 years the tenant shall handover the peaceful possession of the property.
2. No there is no restriction you can construct you can make a new rent agreement.
3. The property area which is not rented out in that there can be construction.
Sir, Thank you for the reply. With reference to my second query, I came across some information/rumour that when a land is rented for Petrol Bunk/LPG Gas stations, after the tenant vacates the land, there is a ban on new building construction on the same land for 5 years due to petroleum leakage in the land. I was not sure whether this info was correct or untrue. Please advise whether I can ignore the above information came to me.
Asked 7 years ago
That would be according the contract though after removal of oil tanks from.ground there can be construction.
you can before you give your premises on rent to petroleum company seek clarifications in this regard whether there are any restrictions for carrying on construction on expiry of licence
unable to find any such information online
Hi,
For safety puropose, you may mention in rent agreement that the petroleum company will be fully responsible for the leakage etc.
You can go for a lease agreement for a specific period. On determination of lease, the lessee is bound to put the lessor into possession of the property.
For your 2 & 3 no. quarries, it is stated that in general there is no legal hindrance. However since petroleum is highly inflatable product, various safety norms may be imposed by various authorities /local authorities which you must be aware of.
You need to execute a leave and license Registered Agreement. There are no restrictions. You need to check the averments in the Agreement.
the minimum period of lease for petrol pumps is generally 30 years, hence your condition for 5 years lease may not be acceptable.
You will be given with the terms and conditions for lease of such lands, you may go through them to get more clarity on it.
You have rightly herd or have been informed in the right sense about it.
Hence think about it keeping in view the long run or future and decide.