Based on the facts stated by you, the absence of a written rent agreement does not mean that the tenant acquires any greater rights over the premises. A landlord-tenant relationship can be established through payment of rent, payment of the security deposit, possession of the premises, and other surrounding circumstances. Therefore, your mother-in-law continues to have the legal right to seek vacant possession in accordance with law.
The tenant cannot legally refuse access to an area containing electricity meters and other utility installations if such access is reasonably required for maintenance, repairs, or payment of electricity bills, particularly where those facilities serve other occupants of the building as well. If she is obstructing access to the utility area and causing inconvenience to other tenants, such conduct may amount to a breach of her obligations as a tenant.
As regards the demand for reimbursement of renovation expenses, the general legal position is that a tenant is not entitled to recover the cost of alterations or office fit-outs carried out for her own convenience unless the landlord had expressly agreed to bear such expenditure. If she voluntarily incurred expenses for furnishing or modifying the office without any written agreement requiring your mother-in-law to reimburse her, she cannot ordinarily compel payment as a condition for vacating the premises.
Since she has already agreed in principle to vacate upon refund of the security deposit, your mother-in-law should not refund the advance until vacant and peaceful possession, along with the keys, is handed over. At the time of vacating, a possession memo should be prepared recording that possession has been delivered, the premises have been inspected, the keys have been handed over, and the security deposit has been refunded after adjusting any legitimate dues, if applicable.
If the tenant subsequently refuses to vacate or insists on payment of alleged renovation charges, your mother-in-law should issue a formal legal notice terminating the tenancy, calling upon her to vacate the premises within a specified period and rejecting the demand for renovation expenses. If she still fails to vacate, appropriate eviction proceedings and recovery of possession may be initiated before the competent court.
Considering the disputes that have arisen and the fact that the tenant is an advocate, it would be advisable to avoid unnecessary verbal confrontations. All further communication should preferably be in writing through WhatsApp, email, or legal notice so that a proper record is maintained. If there is any apprehension of threats, intimidation, or obstruction, the local police may also be informed for preventive assistance, although they generally do not decide landlord-tenant disputes.
On the facts narrated by you, the tenant cannot legally insist that renovation costs be paid merely because she chose to modify the premises for running her office. Your obligation is ordinarily limited to refunding the security deposit upon peaceful vacation of the premises, subject to adjustment of any legitimate dues or damages, if any.