In a Real Estate transaction, the role of the accompanying legal document in effecting a transparent deal can hardly be overstated. A faulty or inconclusive document will fail to safeguard against future litigation.
We advise and provide documentation for contracts, agreements
or other legal forms/documents you may need, in a simple and
easy-to-use formats. You can use the sample forms in our section
for Lease Deed, Power of Attorney, Agreement to Sell,
Sale Deed/Agreement for Sale, Gift Deed, Leave and Licence Agreement,
Conveyance Deed and Transfer Deed.
We can help you draft the perfect legal document. Our services are spread pan India, thanks to our seamless network of legal experts.
Lease Deed
A "Deed of Lease" is a written document stating the agreement between the lessor and the lessee in regards to the terms of transfer of property by the lessor to the lessee.
This document states the subject matter, consideration and terms of renewal including clauses to cover every possible scenario that might arise during the tenure of the lease. The tenure of the Agreement is usually for a year which can be further extended.
A lease deed is a vital document admissible in court and stands testimony to the deal between the parties entering into a transaction. Not having a lease deed as a proof can go against both the parties in case any one of them backs off from an initial statement. So this should be made binding on both parties.
Clauses in a typical Lease Agreement
- Parties' Details: Name and addresses of
the parties entering into the Deed.
- Property Details: Its location and identification
details.
- Date of Demise and Determination: The effective
dates of commencement (demise) and expiry (determination)
of Agreement.
- Terms of lease: The effective date of commencement
of Lease Agreement and the date till which the Agreement shall
remain effective.
- Obligation of the parties: Promises made
for letting the property on lease.
- Lease Amount: Amount mutually decided and
mode of payment of rent. It also includes: security deposits
(if any), refund circumstances, advance rent payable (if any).
- Rent Increment Clause: Conditions of rent
increment including when and by how much, if applicable.
- Modification of Terms: Usually an Agreement
is modified if both the parties agree to new terms. It should
be revised at least once a year.
- Termination: Grounds and conditions of
termination of the Agreement and notice period required for
the termination of contract.
- Facilities: Facilities included in rent
like any fixtures or fittings provided by landowner.
- Common Areas: Access and usage rights
to common areas of the property such as: terrace, stairs, garage.
- Payment of Bills/Taxes: The agreement
spell out who is liable to pay taxes incurred on property.
(E.g. Municipal taxes, property tax, house tax, electricity and
water bills.)
- Repair: It outlines who is liable for
the payment of any repairs and maintenance works.
- Subleasing: It would specify whether or
not the subject matter is allowed for sub-leasing and circumstances
under which it is allowed.
- Renewable Clauses: Usually the lease is
renewed on expiry of tenure if so desired but clauses already
there can support an earlier renewal.
- Others: Any additional commercial terms
mutually agreed upon by both parties.
Power of Attorney
A "Power of Attorney" is a legal instrument whereby one person is set in place of another to act for him as his legal representative, and to make binding legal and financial decisions on his behalf.
The Power of Attorney can grant extensive power to the person appointed to be an Agent. Hence it calls for giving careful consideration to the person to whom you choose to grant those powers and being aware of its scope. If a person wants to present a document for registration at the proper registration office and if, for some reason he cannot be present, he may do so through his representative who is duly authorized by a Power of Attorney.
Execution of a Power of Attorney:
A Power of Attorney has to be executed and attested as prescribed by law. The Registrar or the Sub-Registrar or the Magistrate must first satisfy himself that the Principal has voluntarily executed the Power of Attorney before he can attest a Power of Attorney.
As per Section 33(c) of the Registration Act, 1908, if the principal, at the time of executing the Power of Attorney does not reside in India, then it has to be executed before and authenticated by notarized and attested by an authorized official of the Indian Embassy/Indian consulate or Trade Commissioner of India in the country where the principal resides.
The lack of properly drafted and executed Power of Attorney due to ignorance of law, can lead to a lot of complications. We advise you about and prepare for you, the appropriate type of Power of Attorney according to your needs and the circumstances of your particular case.
Gift Deed
A gift is a transfer made gratuitously, that is, without any element of monetary consideration. A deed cannot be dispensed with even for a property of small value. A gift of immovable property is invalid without a registered instrument. Hence, attestation by two witnesses is required.
A gift of immovable property, which is not registered, is void and cannot confer any title to the donee under Section 123 of the Transfer of Property Act. A gift which was not based on fraud, undue influence or misrepresentation, the Gift Deed can be cancelled only by resorting to legal remedy in a court of law. While drafting a Gift Deed, these clauses should be specifically noted:
- Name of donor
- Name of donee
- Date of gift becoming effective
- Subject matter
- Absence of monetary consideration
- Act of transfer from donor to donee
A clause in the gift deed totally prohibiting alienation is void.
Agreement to Sell
Agreement to Sell is a record of the terms agreed upon by the contracting parties in the sale of a property. It is not a document through which the transfer of title will be effected. Registration of Agreement to Sell is now compulsory by law.
Agreement to Sell is governed by the provisions of the Indian Contract Act, 1872 and the Transfer of Property Act, 1882. It informs about how the seller got the property, settlement of the sale price, mode of payment, seller's obligation to obtain statutory clearances to convey clear title, to indemnify the purchaser against loss or damage due to defect in the title.
The following terms should be part of the Agreement:
- Nature of the title held including encumbrances such as lease, mortgage, and charges on the property.
- Any material defect in the property, defect in the title disclosed by the seller.
- Location and description of the property agreed to be sold.
- Consideration amount including any part payment of consideration or earnest money, mode, place and time of payment.
- Time frame to complete local laws and statutory obligations.
- Section 55 of Transfer of Property Act makes it mandatory for the seller to produce documents for scrutiny by the purchaser and his Advocate.
- Forfeiture clauses in case of breach of contract by either party.
Leave and Licence
A leave and licence does not create any interest in the premises in favour of the licensee but gives the licensee the mere right to use and occupy the premises for a temporary period. On the other hand, when premises are given out on lease or tenancy basis the legal possession of the premises/ interest in the premises is also deemed to be transferred to the lessee and tenant respectively.
In deciding whether to give out premises on leave & licence basis the following are serious considerations on the following front:
Possession: In a leave and licence agreement,
the owner is deemed to be in legal possession of the premises
and the licensee in constructive possession of the premises.
Income Tax: In a leave and licence agreement
the owner has to pay tax effectively at the rate of 33% on the
license fee earned but gets a standard deduction amounting to
1/4th of the license fee for repairs.
Municipal Tax: In a leave and licence agreement,
the Municipal Authorities may charge taxes (at the rate of up
to 60%) of the license fee. If there is a security deposit amount
the Municipal Authorities may charge tax accordingly.
Maharashtra Rent Control Act, 1999, which has come into effect since March 31, 2000, provides (Sec 24) for a body known as the Competent Authority responsible for bringing summary relief to the owner of residential premises. The Competent Authority on being satisfied that the period of licence has expired shall pass an order for the eviction of the licensee. Also, the section provides that the licensee shall be liable to pay damages at double the rate of the licence fee or charge fixed under the agreement of the license from the day of default till the date of disposition.