• Lock in Period

I had rented a property for purpose of restaurant business. In the agreement, landlord had mentioned that he is leasing the property for purpose of "Restaurant business" but smartly didn't mention commercial anywhere. After taking possession, realised property was still a residential property. There were BMC cases on the property and unless there was a change of user, getting food and health licence was impossible. Agreement had a lock in period of 2 years. Tried convincing the landlord to help with change of user and he kept denying. Finally, I had to decide to move out. When I discussed this with landlord, he agreed to pay back the deposit after deducting dues but 50% at the time of possession and 50% when he gets new tenants. We agreed to it and the day when the handover of property was completed he refused to return the deposit claiming i was in 2 years lock in period and if I terminate the agreement before that period agreement allows him to deduct the deposit. Since this was a fraud transaction (renting out residential property for commercial use) I believe I might have some rights to fight back for my deposit. Wish to understand if there is law which supports my claim.
Asked 7 days ago in Property Law
Religion: Hindu

4 answers received in 1 hour.

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9 Answers

Please issue him a legal notice stating that you were forced to terminate the agreement only on account of his suppression and misrepresentation of facts and demanding immediate refund of the rental deposit on or before a deadline. If there is no positive response, proceed to file a suit at the proper court.

Swaminathan Neelakantan
Advocate, Coimbatore
1018 Answers
17 Consultations

4.9 on 5.0

The entire transaction is vitiated by fraud 

When the landlord himself mentioned in the contract that he is letting his property for residential business, it necessarily implies that such letting would be permissible only if the nature of user of the premises is commercial 

No restuarant can operate from a residential premises 

The landlord ought to have disclosed that his premises has a residential user and there are pending BMC cases on his property 

He suppressed vital and material facts from you which is entirely fraudulent 

Thus landlord refusing to refund your deposit is illegal 

Also you are entitled to the refund of full deposit on simultaneous handover of vacant possession to the landlord. The landlord cannot impose unilateral condition that 50% will be paid on possession and balance 50% when he finds a new tenant 

The landlord cannot take undue advantage of his wrong 

You will have to file a police complaint against the landlord and also file a civil suit for recovery of your deposit with compensation and damages 


You had to vacate the premises as it became impossible for you to run your business since the user itself was residential 

This is plain fraud 

So the lock in period stipulation does not apply at all against you 

Yusuf Rampurawala
Advocate, Mumbai
6500 Answers
55 Consultations

5.0 on 5.0

Issue legal notice to landlord to refund your deposit 

 

if he refuses sue the landlord to recover your money with interest as residential property cannot be used for commercial purposes 

Ajay Sethi
Advocate, Mumbai
84384 Answers
5530 Consultations

5.0 on 5.0

- As per law , a restaurant business is considered as commercial activity and not a residential 

- Since, the landlord has mentioned in the lease deed for business , then he has violated the terms of contract after hiding the reality of the tenanted premises from the tenant . 

- Hence , the said landlord has committed the offence of cheating and breach of trust and by this way the said lease deed is not valid legally , and the terms of the lease not bound you to comply. 

- Further , the said landlord is under obligation to refund the full security amount deposited by you with the rent received from you through an invalid lease deed. 

-  You can send a legal notice to the landlord for the refund of the security amount with the rent paid by you. 

- If no response , then file a recovery suit before the court. 

Mohammed Shahzad
Advocate, Delhi
8182 Answers
86 Consultations

5.0 on 5.0

  1. You are entitled not just for your deposit but also for compensation as it's a case of misrepresentation of facts by the landlord. 
  2. You have to sue the landlord before the civil judge. 
  3. I'm willing to assist you as your counsel (advocate) and take your litigation to its logical conclusion. 
  4. However, I require an exhaustive consultation session with you first. You need to visit me for that. 
  5. I'm based in Mumbai/NaviMumbai just as you are...  So it shouldn't be much difficult for you to visit me for exhaustive consultation. 
  6. ९८२०८९७८८४. (Nine eight two zero eight nine seven eight eight four) 

Netra Mohanchandra Pant
Advocate, Navi Mumbai
1422 Answers
5 Consultations

4.4 on 5.0

Dear Client, 

You will have to file a case for fraud and misrepresentation in appropriate jurisdiction against the landlord if you want to get back your amount fully. 

Thank you

Anik Miu
Advocate, Bangalore
2729 Answers
27 Consultations

4.9 on 5.0

You issue a legal notice to the landlord stating that even though you had taken the premises for commercial purposes and the same was mentioned in the lease agreement that the premises has been let out for rent for the purpose of conducting restaurant business, you were shocked to learn when your application for license was rejected by the authorities concerned stating that the property comes under residential category hence licence cannot be provided until the same has been converted to commercial type, that the landlord did not cooperate to convert the same to commercial and was reluctant to help you out even though the fault is on the side of the landlord.

Therefore it is clear that the landlord has committed a fraud by letting out the residential property for commercial purpose (restaurant comes under commercial category automatically without mentioning specifically about it), hence he has committed breach of conditions due to which as per the terms of the rental agreement he has to return the full deposit amount during the lock in period and to pay penalty for the above lapse on his side, and if he is not complying with the demands made within 7 days from the date of receipt of this legal notice he can be prosecuted by both civil and criminal laws accordingly for the offences and the reliefs sought. 

You can contact an advocate and get the legal notice prepared properly and send to the landlord for reliefs. 

T Kalaiselvan
Advocate, Vellore
74484 Answers
1226 Consultations

5.0 on 5.0

Yes you can send him legal notice first you get the refund and file a suit against him for recovery of all your dues. In this case you will get dues as well as compensation.Its a good case on merits.you xam also file a cheating complaint under criminal law against him also. If you need any further assistance, you can approach me through kaanoon or LinkedIn.
https://www.linkedin.com/in/prashant-nayak-5477b138

Prashant Nayak
Advocate, Mumbai
24476 Answers
52 Consultations

4.4 on 5.0

Yes you have right to claim your deposit back as the misrepresentation in the agreement here violates Sec 10 of the Indian Contract Act which defines the essentials of a valid contract.

You can first send a legal notice to the landlord as suppression of material facts and misrepresentation is a fraud. If the landlord does not comply with the notice, then you may file a recovery suit stating that the contract is voidable, and then a declaration suit seeking injunction.

Indu Verma
Advocate, Chandigarh
37 Answers
2 Consultations

5.0 on 5.0

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