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FAQ - Registration Leave License Agreement

A Notarized Agreement is a Leave and License Agreement that is attested by a Notary Public. The Notary public only verifies the identity of the owners and the tenant signing the agreement and stamps the agreement as “Signed Before me”.

 

The Notary does not check the clauses and conditions of the agreement, but only verifies the identity of the owner and tenant.

 

A Notarised agreement has the stamp (signed before me), seal and sign of a Notary on the last page of the agreement.

A Leave and License Agreement agreement that is signed before and scanned with the Government’s Registrar office is a registered agreement. This process is conducted and concluded with the office of Sub Registrar for a particular area.

 

It requires all owners (or PoA holder) and tenants to be present at one of the Registration offices in Pune at the scheduled date and time.

 

The Registrar or the Sub-Registrar usually checks the entire document and checks if adequate stamp duty is paid for the agreement. He also checks if the PoA holder is duly authorized and has appropriate powers to sign and register the agreement on behalf of the owner.

 

At the registration office, photos, signatures and thumb impression of the owners (or PoA holder) and tenant are taken and the entire agreement is scanned by the registrar.

 

A registered document becomes a public document and can be accessed in accordance with the legal procedures.

1. Law requires ALL Leave and License Agreements to be written and registered.

 

2. Getting an agreement registered is a safer option as compared to a notarized agreement

 

3. Getting an agreement registered takes much more time and money as compared to a notarized agreement.

 

4. A notarized agreement can work as an address proof for the tenant in limited cases only e.g. new internet connection, phone connection etc. However, for government purposes such as passport application and renewal, new vehicle (RTO) registration, the tenant can show only a Registered Agreement as address proof. Hence, most tenants insist on a registered agreement.

1. The Leave and License Agreement should be drafted carefully with proper terms and conditions

 

2. Cost of the formalities is shared equally between both the parties

 

3. Stamp duty has to be paid in full

 

4. In case of renewal (after expiry of previous agreement), the new agreement has to be drafted with revised dates and rent and notarized or registered again.

 

5. Police verification of the tenant has to be done for all tenants after the agreement is completed or renewed

Registration being an electronic process depends upon the connection and speed of the centralized government server, for e.g. - if the central server is down or connectivity is slow, registration may take longer time.

 

Do's

1. Do review and approve the agreement before reaching the registration office.

2. Do bring the original documents such as ID proof, ownership proof (electricity bill, property tax bill, Index II) Power of Attorney and photo to the registration office.

3. Do verify your name in the local vernacular when asked to do so by the advocate.

4. Do arrive on the time given to you by our associate. No shows will be charged at full fees.

 

Don'ts

1. Don't get into arguments with the registrar and his deputies.

2. Don't get into arguments with the advocate at the registration office.

3. Don't forget to collect the originals and other proofs from our associate.

 

Note:The ideal time for doing registration is between Monday to Friday as registration on Saturdays and Sundays are costly due to heavy rush.

1. Mandatory by Law: Sec 55 of Maharashtra Rent Control Act makes it mandatory for the owner to get the L and L agreement registered. Owner can be punished with imprisonment up to 3 months or with fine upto Rs 5000 or with both if he contravenes provisions of this section.

 

2. Tenant needs it: Without a 'registered agreement' tenant cannot

- Buy a vehicle: RTO requires tenant to show registered agreement as address proof when passing the vehicle

- Apply for a Passport: Passport office requires tenant to show the registered agreement as an address proof

-Claim HRA deduction in Income Tax: many reputed companies stipulate their employees attach copies of registered agreements when claiming HRA. Hence, many tenants also avoid renting flats when owner cannot register the agreement.

 

3. Society Committee makes it mandatory: Many societies do not issue NOC to tenants for moving into the property unless copy of registered agreement and police verification of tenant is submitted to the Society. Societies have introduced fines up to Rs 15,000 if owner does not complete these formalities.

After the owner has registered his agreement and completed police verification of tenant, most societies require the owner to complete the following formalities:

 

1. Submit application to society for permission to rent out the flat '(in a form called Appendix 28'

2. Submit copy of Registered Leave and License Agreement to the Society

3. Submit copy of tenant’s police verification to the Society

4. Submit signed application forms to society for tenant to become a nominal member '(in a form called Appendix 11'

 

As practice, societies usually issue a No-Objection Certificate (NOC) after receiving these documents. The tenant needs to show this NOC at the security gate before moving in his furniture.

Calculation of Stamp duty for Leave and License Agreement in Maharashtra

 

If the Leave and License Agreement is for a period of 12 months, the stamp duty is calculated in the following manner:

 

Monthly rental x 12 = A (Annual Rent)/p>

10% of Refundable Deposit = B

Total amount C = A+B

 

Stamp Duty D = 0.25% x C.

 

(0.25% is a standard stamp duty rate paid to government)

 

Note: The figures mentioned above are indicative only and are subject to change with amendments in the provisions of law.