Uttar Pradesh Urban Buildings (Regulation of Letting, Rent and Eviction) Act, 1972 | Important Acts and Laws for Judiciary Exams PDF Download

Introduction

• The Uttar Pradesh Regulation Of Urban Tenancy Ordinance, 2021 was promulgated by the governor of Uttar Pradesh on January 9, 2021, and came into effect on January 11, 2021. It aims to resolve tenancy disputes promptly and effectively.
• Property Coverage: The law regulates residential and non-residential premises in urban areas to ensure transparent transactions between landlords and tenants.
• Rent Authority and Rent Tribunal: The Rent Authority, headed by the district collector, and the Rent Tribunal, overseen by the district and session judge, are designated bodies for dispute resolution. They must resolve issues within 60 days.

Features of the New Tenancy Law

• Both tenants and landlords must notify the Rent Authority when executing rent agreements. Security deposits are capped at two months for residential premises and six months for non-residential premises.
• If tenants fail to vacate after the agreement expires, parties can renew or extend the lease. Essential services like electricity and water cannot be cut off by landlords.
• Annual rent increases are limited to 5% for residential properties and 7% for non-residential properties. The law provides a shield to tenants against arbitrary rent hikes.
• Mandatory Rent Agreements: Landlords and tenants must sign written rent agreements, disclosing them to the Rent Authority within two months of the lease start.
• UP Rent Authority: All rent agreements must be registered with the Rent Authority for legal validity. Disputes must be resolved within 60 days.
• Limitation on Rent Increases: The law caps annual rent increases and outlines eviction procedures for non-payment.
• Agreements Prior to the Ordinance: Pre-existing agreements will be subject to the new ordinance upon renewal, regulating rent enhancements.

Important Sections of the Act

Ordinance Not to Apply to Certain Premises (Section 3)

Specifies premises exempt from the ordinance, including government-owned properties, employee-rented company properties, and buildings of religious institutions or public trusts.

Tenancy Agreement- Section 4

• Landlords and tenants must inform the Rent Authority in writing when renting out a property after this Ordinance's effective date.
• If the landlord and tenant do not jointly notify the Rent Authority about the tenancy agreement, they must individually inform the Rent Authority within one month after the agreement ends.

Period of Tenancy - Section 5

• Every tenancy agreement signed after the enactment of this Ordinance remains valid for the duration agreed upon by the landlord and the tenant.
• If the tenant wishes to extend the tenancy within the agreed period, they can request the landlord for renewal. Upon acceptance by the landlord, a new agreement can be established based on mutual terms.
• When a fixed-term tenancy concludes without extension or if the tenant fails to vacate the premises, they become liable to pay increased rent to the landlord.

Rights and Obligations of Successor in Case of Death - Section 6

• Upon the death of either the landlord or the tenant, the terms of the tenancy agreement are binding on their successors. The successor of the deceased landlord or tenant is obligated to uphold the rights and responsibilities outlined in the lease agreement for the remaining duration of the tenancy.
• When a tenant passes away, his tenancy rights are inherited by specific individuals who include:
  • His spouse
  • His son or daughter
  • In cases where there are both a son and daughter, both inherit the rights
  • His parents
  • His daughter-in-law, who is the widow of his deceased son
  • His widowed or divorced sister

Restriction on Subletting - Section 7

In Section 7, tenants are restricted from subletting any part of their rented premises or transferring their rights without additional agreements. This ensures that tenants cannot bypass the original terms of the tenancy agreement. For instance, if a tenant wants to sublet a room in their apartment, they must first seek permission from the landlord and formalize the arrangement in writing.

Rent Authority Determining Revised Rent - Section 10

Section 10 empowers the rent authority to resolve disputes regarding rent revisions by considering the current market rates in the area. For example, if a tenant disputes a proposed rent increase, the rent authority may compare the rent in similar properties nearby to determine a fair and reasonable rate. This practice aims to ensure that rent adjustments are in line with prevailing market conditions.

Security Deposit- Section 11

• The security deposit, as outlined in Section 11, is an upfront payment made by the tenant. It should be mutually agreed upon by the landlord and the tenant in the tenancy agreement.
• For residential properties, the security deposit should not exceed 2 months' rent.
• For non-residential premises, the security deposit should not exceed six months' rent.
• Upon returning the premises to the landlord, after settling any outstanding dues, the security deposit will be refunded to the tenant.

Deposit of Rent with Rent Authority - Section 14

• If the landlord refuses to accept rent or other charges or provide a receipt, the tenant must pay the rent and charges via a postal money order or another prescribed method for two consecutive months.
• If the landlord still refuses to accept payment within this period, the tenant has the right to deposit the rent and charges with the eviction officer.
• When a tenant is unsure about who the rent is owed to during the tenancy, they can deposit the rent with the rent authority.

Repair and Maintenance of Property- Section 15

• If a tenant fails to make repairs, the landlord can carry out the repairs and deduct the costs from the security deposit, which the tenant must reimburse within a month of notification.

How does the new UP Tenancy Act benefit property owners and tenants?

• The new UP Tenancy Act provides protections for both landlords and tenants. It prevents arbitrary rent increases by landlords and clearly outlines the responsibilities of both parties in the rental agreement.
• Landlords benefit as the terms of the rental agreement must be followed explicitly by the tenant, reducing potential disputes.

Conclusion

• The introduction of the new Tenancy Act in Uttar Pradesh aims to create a robust and fair property market akin to those in developed nations like the United States.
• While there is still progress needed to align India's real estate sector with global standards, this Act marks a significant step forward by the UP government.