Why rent agreements in India are 11 months, and when to register

The 11-month agreement is so standard that most tenants never ask why. The answer is a century-old law. Section 17 of the Registration Act makes registration compulsory for leases of immovable property that run from year to year, for any term exceeding one year, or that reserve a yearly rent. An 11-month agreement with the rent stated monthly triggers none of the three.

What registering a rent agreement would cost

Registering a lease means paying stamp duty on the value of the lease, which many states calculate on the rent and deposit over the term, plus a registration fee, and usually a visit to the sub-registrar's office. For a landlord re-letting every year, avoiding that is the whole point of the 11-month format.

What an 11-month agreement does not avoid

• Stamp duty. The agreement must still be executed on non-judicial or e-stamp paper of the value your state prescribes. An unstamped or under-stamped agreement can be impounded, and a penalty has to be paid before a court will rely on it.
• Your state's rent and tenancy law, which still governs the relationship.
• The Maharashtra rule. Under the Maharashtra Rent Control Act, leave and licence agreements must be registered regardless of their length, which is why agreements in Mumbai and Pune are routinely registered online.

What 11 months means for you as a tenant

• Renewal every 11 months, usually with a rent increase. Fix the increase in the agreement, commonly a set percentage, rather than leaving it open.
• A lock-in period, if the agreement has one, during which you pay rent even if you leave early.
• A notice period, commonly one or two months, for either side.
• The security deposit, and exactly what can be deducted from it. Getting your security deposit back covers this in detail.

Clauses to check before you sign

• Rent, the due date, and the increase at renewal.
• The security deposit and the conditions for getting it back.
• Who pays maintenance, electricity, water and repairs.
• Lock-in and notice period, on both sides.
• An inventory of furniture and fittings, with their condition, ideally with photos.
• Whether pets, guests or subletting are allowed.