Model Tenancy Act, Need, Key Features, Key Issues, Significance

The Model Tenancy Act 2021 is a law made by the Government of India to bring fairness and clarity in renting houses and shops. It tries to protect the rights of both landlords (owners) and tenants (people who rent). The Act makes rules about rent, security deposits, maintenance, and how disputes should be solved. The aim is to make renting easier, fairer, and less confusing for everyone.

Model Tenancy Act

• The Model Tenancy Act, 2021 is a law made to improve the rental housing system in India. Its main purpose is to balance the rights and duties of both landlords and tenants and reduce conflicts between them.
• The Act proposes the setting up of a Rent Authority to register rental agreements and solve rent-related problems in a fast and fair manner, without going to long court cases. This helps in quick justice and reduces pressure on civil courts.
• Another important aim of the Act is to promote rental housing and bring it into the formal system. Many houses remain empty due to fear of disputes; this law encourages owners to rent out their properties safely.
• By increasing the availability of rental houses, the Act helps people from all income groups, especially migrants, students, and urban poor. In the long run, it supports the goal of reducing homelessness and creating a stable and inclusive housing market in the country.

Model Tenancy Act Need

• Old rent laws were very strict, so many house owners were afraid to rent out their properties.
• Many houses remained vacant because landlords feared they would not get their property back.
• Rental agreements were mostly informal, leading to frequent disputes between landlords and tenants.
• A large number of urban houses were lying empty despite high demand for rental housing.
• Rapid urbanisation and migration increased the need for a clear, fair, and modern rental law.

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Model Tenancy Act Key Features

• Written Rental Agreement
  • The Model Tenancy Act says that the landlord and tenant must make a written agreement before renting a house or shop. This agreement clearly mentions the rent amount, time period of rent, and other rules, so that there is no confusion later.
• Security Deposit Rules
  • To protect tenants from paying very high deposits, the Act fixes a limit on security deposits. For houses, the deposit cannot be more than two months’ rent, and for shops or offices, it cannot be more than six months’ rent.
• Eviction of Tenants
  • A landlord can ask a tenant to leave only in certain cases. These include not paying rent, not paying rent for a long time, using the property without permission, or misusing the property even after a warning. This prevents unfair eviction.
• Dispute Resolution System
  • The Act sets up a three-level system to solve rent-related problems: Rent Authority, Rent Court, and Rent Tribunal. Normal civil courts cannot interfere in these matters. This helps in quick and simple settlement of disputes.
• Appointment of Authorities
  • Rent Authorities and Rent Courts are set up at the district level with the approval of the state government. The Rent Tribunal is formed by the state or union territory government after consulting the High Court. This ensures proper supervision and fairness.

Model Tenancy Act Key Issues

• The Model Tenancy Act tries to improve the rental housing system, but it may not solve all major problems. Issues like lack of affordable houses, limited availability of rental homes, and informal renting may still continue unless more reforms are made.
• The Act gives very detailed rules about rent agreements, such as who will do repairs and how much security deposit can be taken. Some experts feel that such small details should be decided by the landlord and tenant themselves, instead of being fixed by a central law.
• To register a rent agreement, the Act asks for an Aadhaar number. This may go against earlier Supreme Court rulings and could raise concerns about people’s privacy.
• The Act also requires agreement details to be put on an online public portal, which may expose personal information of landlords and tenants.
• In some cases, the Act does not clearly say how quickly disputes must be solved, such as problems related to rent increase, stopping basic services like water or electricity, or mistakes by property managers. This may cause delays in justice.

Model tenancy Act Significance

• It ensures quick and simple settlement of disputes between landlords and tenants through a special authority.
• It modernises and improves the old and outdated rental laws in the country.
• It builds trust between owners and tenants by clearly defining their rights and duties.
• It encourages house owners to rent out vacant houses without fear.
• It promotes private investment in rental housing, helping to reduce the shortage of houses.