Rent act a damp squib, doesn’t cover existing tenancies

Seventeen years after it was passed by the Assembly, the Punjab Rent Control Act-1995, which is now going to be finally implemented, brings no cheer to those looking forward to it the most. The Act is going to be implemented prospectively — from the date of notification — and will protect the interests of only those landlords and tenants who sign rent agreements and deeds after the date of notification.

Thousands of landlords and tenants who are embroiled in protracted litigation for decades over the payment of ludicrously low rents in old city markets will not get any relief under this Act. Sources said the move comes in wake of immense pressure on the SAD leadership by the BJP, which has a major vote bank among shopkeepers in towns.

Though the cabinet on Tuesday had adopted the 1995 Act per se, which extends to existing tenancies, it has been decided that the Act be amended the day it is notified to state that it will not be applicable to existing tenancies. The amendment will then be passed as an ordinance and only then will the Act be implemented.

Parts of Section 3, 6, 7 and 9, which allowed existing landlords to demand a certain minimum revised rent from the tenant will removed from the 1995 Act. Existing landlords cannot move the rent authority, which will be constituted under the Act for relief in older cases. They would continue to be governed by the Eastern Punjab Rent Restriction Act-1949.

While this renders the Act useless for those landlords who are already stuck with low rents, it is expected to make the tenancy laws stricter for the future. The new Act provides for a compulsory registration of the tenancy agreement between the landlord and the tenant.

Also, the implementation of the Act will help the state get its share of JNNURM funds. Existence of rent control laws is one of the several reforms to be carried out by the states to be eligible for JNNURM funds.

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