What is the Maharashtra Rent Control Act?

The Maharashtra Rent Control Act was passed in 1999 to protect the interests of the tenants and landlords. It came into effect on March 31, 2000, and has since regulated rental housing in the state of Maharashtra.

Maharashtra attracts many migrants. The demand for affordable housing is very high. By passing the Maharashtra Rent Control Act, the government caters to this demand.

Major duties of landlords and tenants under the Maharashtra Rent Control Act

1. Standardized rent – To make housing affordable, the Maharashtra government passed the Rent Control Act. Under this Act, a landlord can face legal consequences if the rent charged exceeds the standard rent.
2. A solid rent agreement – The Rent Control Act stipulates that the landlord and tenant must register the rent agreement. Under the Act, any agreement between the landlord and tenant must be in writing. The responsibility for the rent agreement lies with the landlord. Failure to comply will lead to legal consequences such as a fine not exceeding ₹5000 or imprisonment, or both.
3. Conditions for eviction – The landlord may recover possession of their premises if 
   • The court finds the reasons for eviction are rational and genuine.
   • The tenant has constructed any permanent structure on the rental property without permission.
   • The tenant or anyone claiming to be working under or living with the tenant is found guilty of misconduct.
   • The tenant is convicted of using the rental property for illegal purposes.
4. Usage of rental property – The rental property cannot be used for commercial purposes by both the landlord and the tenant. A violation of this rule will lead to the imprisonment of the landlord or a fine of ₹10,000 or both.
5. Inspection of rental property – Under the Maharashtra Rent Control Act, the landlord may inspect the rental property at a reasonable time. The landlord must inspect the premises only after giving prior notice to the tenant. 
6. Supply of necessities – The landlord cannot cut off the supply of necessities like electricity, water, etc., under any circumstances. If found guilty, the landlord will bear a fine of up to ₹1000 or imprisonment or both. 

It is also the duty of the landlord to maintain the upkeep of the rental property. In case the rental property is not repaired within a reasonable time, the tenant may serve a notice of fifteen days. In case of failure to comply, the tenant may deduct the amount for repairs from the rent.

1. Repairs or reconstruction of rental property – Landlords must fulfill certain conditions before they begin any reconstruction or repairs.
   • Landlords must ensure they have sufficient funds to cover the cost of reconstruction and repairs.
   • They must have approvals from local authorities.
   • The number of residential units in the new building must be equal to those in the old building.
   • The carpet area of the premises in the new building must be equal to that of the old building.
   • Demolition of the old building must take place within three months of the tenant vacating the premises.
   • The reconstruction must be completed within 15 months.
2. Transfer of tenancy – The Maharashtra Rent Control Act makes it legal for tenants to receive for transfer of tenancy. A certain percentage of the transaction is kept for transfer of tenancy. The landlord is entitled to accept money for the renewal of the lease or for the transfer of the lease to another person.

How much rent can be increased under the Rent Control Act?

The Maharashtra Rent Control Act allows landlords to increase the rent by 4% per annum. Rents can also be increased by 25% in case of repairs. Furthermore, the landlord may increase the rent if there is an increase in taxes.

How the Model Tenancy Act could impact your rent 

The Model Tenancy Act approved by the government in 2021 could impact the Maharashtra Rent Control Act. It is inferred that if the guidelines of the Model Tenancy Act are followed, then rent prices in Mumbai could increase. 

Chawls in Maharashtra serve as shelters for low-income families. The Maharashtra Rent Control Act enables the landlord to increase the rents of these chawls by 4% per annum. Even then, the rent is lower than most other rental properties. If the Model Tenancy Act came into effect, this could pose a threat to these low-income groups.

Disclaimer: The views expressed above are for informational purposes only based on industry reports and related news stories. PropertyPistol does not guarantee the accuracy, completeness, or reliability of the information and shall not be held responsible for any action taken based on the published information.