Model Tenancy Act 2021 — Guide for Indian Landlords & Tenants

What is the Model Tenancy Act, 2021?

The Model Tenancy Act, 2021 (MTA) is a central government legislation passed to modernise and regulate the rental housing market in India. It was approved by the Union Cabinet in June 2021 and is intended to be adopted by individual states — states enact their own tenancy legislation based on this model framework.

Before the MTA, India's residential rental market was governed by a patchwork of state-level Rent Control Acts, many dating from the 1940s–1970s, that heavily favoured tenants and made eviction extremely difficult. This discouraged landlords from renting out properties and reduced rental housing supply. The MTA attempts to rebalance rights and obligations between landlords and tenants.

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State adoption is not universal

The MTA is a central model — states must enact their own legislation for it to apply. As of 2026, adoption varies by state. Check your state's current tenancy law for the applicable rules in your jurisdiction.

Key Provisions — What Changed

Security Deposit Limits

One of the most significant changes under the MTA is the cap on security deposits:

Residential properties — maximum security deposit is 2 months' rent
Non-residential properties — maximum security deposit is 6 months' rent

Before the MTA, landlords commonly demanded 6–12 months' rent as advance deposit in major cities like Mumbai, Bangalore, and Hyderabad, placing significant financial burden on tenants. The MTA limits this to 2 months for residential rentals.

How Tenanting handles this

The advance amount (security deposit) is recorded in every contract. The lease generated by Tenanting includes the deposit amount and refund conditions explicitly. Deposit receipt and refund status are tracked in the contract ledger.

Written Agreement Mandatory

The MTA makes a written tenancy agreement mandatory for all rentals. The agreement must be submitted to the Rent Authority within two months of execution. Key required clauses:

Names, addresses, and identity details of landlord and tenant
Description of the premises
Monthly rent and due date
Security deposit amount
Rent revision terms and notice period
Duration of tenancy
Responsibilities of landlord and tenant for maintenance
Subletting clause
Notice period for termination

Tenanting's AI-generated Leave and Licence Agreement covers all these mandatory clauses across its 21 sections.

Notice Period Requirements

Situation	Required notice period
Tenant vacating (residential)	1 month notice to landlord
Landlord asking tenant to vacate	3 months notice to tenant
Non-payment of rent	15 days written notice before eviction proceedings
Lease expiry without renewal	Tenant becomes a statutory tenant — separate eviction process required

Rent Increase Rules

Under the MTA, rent can only be increased with advance written notice of 3 months to the tenant. The increase must be as per the terms agreed in the tenancy agreement — not arbitrarily at the landlord's discretion. Tenanting's rent escalation setting (configured in Settings → Rent) records the agreed escalation percentage and applies it at renewal with the appropriate notice period.

Maintenance Responsibilities

Landlord's responsibilities

Structural repairs (walls, roof, foundation)
Whitewashing and painting (external)
Repairs to drains, gutters, sewers
Plumbing and sanitary fittings maintenance
Electrical wiring (fixed installations)
Repair of common areas

Tenant's responsibilities

Day-to-day minor repairs
Keeping premises clean and sanitary
Not damaging fixtures or fittings
Replacing broken glass panes
Maintaining garden/lawn if applicable
Informing landlord of major defects promptly

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Photo documentation protects both parties

Tenanting's Issues module creates a timestamped, photo-documented record of every maintenance event. If there is ever a dispute about who was responsible for a repair — and whether it was reported promptly — the ticket log is the evidence. Both landlord and tenant benefit from this record.

Eviction Under the MTA

The MTA establishes a Rent Authority and Rent Court to handle disputes and evictions — replacing the slow civil courts process. Grounds on which a landlord can seek eviction:

Non-payment of rent for 2 consecutive months after written notice
Subletting without permission
Using the premises for an illegal purpose
Causing damage to the property
Expiry of lease term where tenant refuses to vacate
Landlord requires premises for personal use or major repairs

The MTA sets timelines for Rent Authority proceedings — typically 60 days for disposal of cases. This is significantly faster than civil court proceedings which could take years under old Rent Control Acts.

Why 11-Month Leases Are Standard

The standard practice of 11-month lease terms in India predates the MTA and is based on the Transfer of Property Act, 1882 (Section 107): leases of 12 months or more for immovable property must be registered with the sub-registrar's office, requiring payment of stamp duty and registration fees. Leases of less than 12 months are exempt from mandatory registration.

The 11-month Leave and Licence Agreement avoids mandatory registration while still being a legally valid and enforceable contract. The MTA does not change this — registration requirements are governed by the Transfer of Property Act and the Registration Act, 1908, not the MTA.

Tenanting generates 11-month agreements by default. If you require a longer-term lease, the agreement is formatted for sub-registrar presentation, but registration, stamp duty payment, and e-registration remain the parties' responsibility.

Leave and Licence vs Lease — What's the Difference?

Most urban residential rental agreements in India are structured as Leave and Licence Agreements rather than leases. The difference matters legally:

Aspect	Leave & Licence	Lease (Rent Deed)
Legal instrument	Indian Easements Act, 1882	Transfer of Property Act, 1882
What is granted	Permission to use the premises (revocable)	Exclusive possession of the premises
Tenant protection	Lower — licencee has no interest in property	Higher — tenant has legal possession
Eviction speed	Faster — no interest in land to dispute	Slower — full civil process
Standard for	Residential urban rentals in Maharashtra, Karnataka, AP/Telangana	Commercial properties, long-term residential
Registration	Required if >11 months in most states	Required if >12 months

Tenanting generates a Leave and Licence Agreement by default — this is the standard for residential rental in most Indian metros and provides landlords with faster dispute resolution while remaining fully enforceable.

How Tenanting Aligns with the MTA

Written agreement mandatory — Tenanting generates or stores a digital agreement for every active contract
Security deposit recorded — advance amount is captured at contract creation and tracked in the ledger with paid/unpaid status
Notice period configurable — Settings → Legal lets you set notice period per property; generated agreement includes it explicitly
Rent escalation documented — escalation percentage is in the contract terms; renewal creates a new contract at the new rent
Maintenance responsibility logged — Issues module records who reported what, when, and who resolved it — essential for MTA maintenance disputes
Non-payment tracking — rent schedule shows consecutive missed payments with overdue dates — the documented basis for MTA eviction proceedings

Related Guides & Resources

Disclaimer: This guide is for informational purposes only and does not constitute legal advice. The MTA's applicability depends on your state's adoption of its provisions. Consult a qualified legal practitioner for advice specific to your situation and jurisdiction.