Maharashtra, India · property

Can Landlord Demand Transfer Fee for Transferring Tenancy to Legal Heir in Maharashtra?

Under the Maharashtra Rent Control Act, 1999, tenancy rights transmit by operation of law upon the death of a tenant to eligible family members residing with them. A landlord has no legal authority to demand exorbitant transfer fees or lump-sum consideration simply to update the rent receipt in favor of a legitimate legal heir. Understanding your statutory protections allows you to resist coercive demands and secure your tenancy through proper legal channels.

Statutory Transmission vs. Voluntary Transfer in Maharashtra

In Maharashtra, tenancy rights under rent-controlled tenancies (including the pagdi system) are strictly governed by the Maharashtra Rent Control Act, 1999. When an original tenant passes away, the tenancy does not revert to the landlord, nor does it create a commercial transaction. Under Section 7(15)(d) of the Act, any member of the tenant's family residing with the tenant at the time of their death in residential premises automatically steps into the shoes of the tenant. For commercial premises, the heir or family member carrying on business in the premises alongside the deceased tenant succeeds to the tenancy.

Because this transfer happens by statutory devolution—operation of law—rather than by a contractual sale or third-party assignment, landlords cannot demand a hefty 'transfer fee,' premium, or percentage of market value (commonly 25% to 33%). While Section 56 of the Maharashtra Rent Control Act permits lawful consideration when tenancy is transferred or assigned to an outside third party with the landlord's consent, it does not apply to legal heirs inheriting under Section 7(15)(d). Demanding consideration to mutate a rent receipt for a statutory heir is unauthorized under the law.

Unlawful Landlord Tactics and Rent Receipt Obligations

A common pressure tactic employed by landlords is withholding the issuance of rent receipts (bhada chitti) or threatening eviction unless a significant fee is paid. This pressure often intensifies if an older building is slated for redevelopment, where landlords attempt to eliminate tenancy records to claim undivided ownership shares.

Under Section 31 of the Maharashtra Rent Control Act, 1999, landlords are statutorily required to issue a written receipt for any rent received. Refusing to accept rent or refusing to provide a receipt constitutes an actionable violation. Landlords cannot unilaterally declare an heir to be an unauthorized occupant or trespasser simply because the heir declines to pay arbitrary 'black money' or unregulated transfer charges.

Remedies When a Landlord Refuses Tenancy Recognition

If a landlord rejects rent or refuses to issue rent receipts in the eligible heir's name without a transfer fee, the heir must not stop tendering rent. Continuous rent tender—via registered post with acknowledgment due, bank transfer, or speed post—creates a decisive evidentiary trail establishing ready and willing compliance under Section 15 of the Act. If the landlord continues to refuse rent, the heir can deposit the rent in court.

When negotiations fail, the successor tenant can file a declaratory suit in the Court of Small Causes (in Mumbai) or the competent Civil Court across Maharashtra to seek a judicial declaration as the lawful tenant under Section 7(15)(d). Once the court issues the decree, the landlord is legally compelled to update the records without charging illegal fees. You can use Caunsel to research this, save documents in a case, or talk to an independent lawyer.

Steps

• Compile proof of co-residence and lineage: Gather death certificate of the deceased tenant, proof that you resided in the premises at the time of demise (such as Aadhaar card, voter ID, ration card, or utility bills), and family tree documentation.
• Obtain consent or No Objection Certificates (NOCs) from other legal heirs: If there are multiple surviving heirs, secure registered NOC affidavits stating they consent to the rent receipt being issued in your name, or agree on joint tenancy.
• Send a formal written requisition for rent receipt transfer: Send a formal communication by Registered Post A.D. requesting the landlord to update the rent receipt under Section 7(15)(d) and Section 31 of the Maharashtra Rent Control Act, 1999, enclosing supporting documents.
• Tender rent systematically: Continue paying rent via verifiable methods such as account payee cheque, demand draft, or money order. If the landlord rejects payment, maintain receipts of return to disprove willful default.
• File a declaratory proceeding: If the landlord remains adamant or demands unlawful transfer charges, initiate a suit for declaration of tenancy rights before the Small Causes Court or relevant Rent Authority.

Common mistakes

• Paying arbitrary transfer fees in unrecorded cash, which creates no legal entitlement and invites future extortion upon subsequent successions.
• Stopping rent payments when the landlord refuses to update the receipt, which exposes you to eviction proceedings on grounds of standard rent arrears under Section 15.
• Signing fresh leave-and-license agreements or surrender deeds that forfeit your statutory rent-controlled tenancy protections.
• Allowing extended delays without formally documenting your co-residence status or securing affidavits from non-occupant legal heirs.

Questions people ask

Can a landlord demand a percentage of property value (like 33%) to transfer tenancy to an heir?

No. While market practices often involve a percentage cut when transferring pagdi tenancy to a non-related third party under Section 56, the law does not permit landlords to demand transfer fees from a family member who inherits tenancy rights by devolution under Section 7(15)(d) of the Maharashtra Rent Control Act.

Who has priority among multiple legal heirs to succeed to the tenancy?

Under Section 7(15)(d), priority is given to the family member who was residing with the deceased tenant in the premises at the time of death. Non-residing heirs do not take precedence over co-residing members, though obtaining NOCs from surviving siblings or heirs prevents subsequent disputes.

What should I do if the landlord stops accepting rent after the tenant's death?

Do not stop offering payment. Send the rent every month via registered post with acknowledgment due or postal money order, accompanied by a letter stating it is tendered on behalf of the estate/successor. Retain all postal acknowledgments or returned envelopes as evidence to protect against eviction suits.

General information only, last updated 2026-10-10. Caunsel is not a law firm and does not practise law. AI answers and this guide are not legal advice. Verify filings, deadlines, and statutes with a licensed lawyer in Maharashtra, India.