Rent / Lease
Reshma K
(Querist) 02 December 2009
This query is : Resolved
hi, in the previous set of Q&A, I had asked that in Bengaluru and may be elsewhere, there is this arrangement wherein tenant pays say for eg, Rs 2 lakhs and stays for 1 or 2 years and when he leaves the entire amount is paid back. In reply the Expert said it is neither lease nor rent, but a kind of mortgage. The answer seems scholarly. In that case how do we style the agreeemtn, what should the agreement be titled as, and also the opneing lines of the agreeement.
N RAMESH.
(Expert) 03 December 2009
The expert was right. Its a kind of mortgage, namely usufructuary mortgage wherein mortgagee is in possession of the mortgaged property in lieu of interest for the principal amount. That is, interest is adjusted towards rent. right. But according to property law, if you it is mortgage, then it requires compulsory registration. To avoid it, you want to say it as lease or rent.
In such case you can say that it is lease deed and the principle amount paid is to be shown as security deposit which carries interest and will be adjusted towards payment of rent.
But if you happen to approach the court, you will have problem in admitting the lease deed as documentary evidence.
adv. rajeev ( rajoo )
(Expert) 03 December 2009
I agree with N.Ramesh, some times it is also known as leave and licence.
leave and license means:This is an agreement between the owner and the tenant. Owner can request the tenant to vacate the house at any time, there will not be binding of period and it does not requires regn.,
Raj Kumar Makkad
(Expert) 03 December 2009
You give title as a Mortgage Deed and insert all the terms and conditions therein. There is no hurdle to execute such document. Tenant is using the space and landlord is using his money without interest so this is usufructuary mortgage.
