This article is about the letting itself: the agreement, the paperwork and the control. The tax on what you earn is a separate subject with its own rules, and it is covered in full elsewhere.
- Agreements of twelve months or more have to be registered, which is why almost every Indian tenancy runs for eleven. In some states, including Maharashtra, leave and licence agreements must be registered regardless of length.
- A leave and licence is not the same as a lease. The difference matters most on the day you want the property back.
- Police verification of the tenant is expected in many cities and is a protection for you, not a formality.
- Whoever signs on your behalf needs a Power of Attorney that actually says they can let the property. A document drafted for something else will not do.
- Write down the condition of the flat before anyone moves in. It is the only evidence you will have later.
Leave and licence, or lease
These are two different legal arrangements and people use the words interchangeably, which causes trouble. A lease transfers an interest in the property to the tenant for the term. A leave and licence gives permission to occupy without transferring that interest. For an owner living abroad, a leave and licence is usually the safer instrument, because recovering possession at the end is simpler.
Under the Registration Act, a lease of immovable property from year to year, or for a term exceeding one year, has to be registered. An agreement of eleven months falls below that line, which is why it became the default across the country. It is a convenience, not a rule that makes the agreement better. In Maharashtra, leave and licence agreements must be registered whatever their duration, so the eleven month habit does not exempt you there.
Registration is not something to avoid on principle. A registered agreement is far stronger evidence if the relationship goes bad, and in several states registration is what makes the document admissible at all. Ask what the position is in the state your property sits in rather than copying what a friend did in another one.
Before anyone moves in
- Verify the tenant. Employment, identity, previous address, and a reference you actually call. A name forwarded by a neighbour is not a check.
- Complete police verification where the city expects it. Many state police forces run an online tenant verification form, and in several cities the obligation sits with the landlord.
- Tell the society. Most housing societies require intimation of a tenancy, issue their own no objection letter, and restrict what a tenant may use.
- Record the condition of the flat. Photographs of every room, the meter readings, and a written inventory of what is being left behind, signed by both sides.
- Agree who pays what. Maintenance, society charges, municipal tax, minor repairs and major repairs, in writing and by name rather than as a general promise.
The most common structure for an NRI landlord is a relative holding the keys informally and collecting rent in cash. It works until there is a dispute, at which point there is no agreement in your name, no record of what was paid, and no documentation of who allowed the tenant in. Put the arrangement on paper even when the person is family, especially when the person is family.
Signing when you are not there
You do not need to fly in. You do need a Power of Attorney that specifically authorises letting the property, signing the agreement, presenting it for registration where that applies, and receiving rent if that is the intention. A POA drawn narrowly for a sale will not cover a tenancy, and a POA drawn so broadly that it covers everything is its own problem.
The POA has to be executed properly where you live, which generally means before the Indian consulate or by notarisation with an apostille, and then adjudicated and stamped in India. The process is the same one used for a property sale, and it is worth getting the drafting right the first time.
Where the rent should land
Rent from an Indian property is Indian income and belongs in your NRO account. Letting it accumulate in a relative's account, or in an old resident savings account you never converted, creates a problem you will meet later: the money is hard to explain, hard to repatriate, and sits outside the paper trail you need when you eventually sell or move funds abroad.
There is also a withholding obligation on the tenant when rent is paid to an NRI, which is a different rule from the one that applies to resident landlords. Tenants frequently do not know this, and the consequence lands on your file rather than theirs. The mechanics belong with the tax treatment and are set out there.
Getting the property back
Plan the exit while the relationship is good. Agree the notice period in writing, agree how the deposit is returned and against what deductions, and agree that a joint inspection happens before the deposit moves. Most disputes between a landlord abroad and a tenant in India are about the deposit, and almost all of them are about evidence that nobody collected at the start.
If a tenant will not leave, that is a civil matter and it is slow. The single thing that most improves your position is a properly drawn and, where applicable, registered agreement with a clear term. The second is a documented handover. Neither can be created after the fact.
Can I let my property without a Power of Attorney?
You can, if you sign the agreement yourself, which is possible remotely in some arrangements and on a visit in others. A POA is what allows somebody else to sign, present for registration and deal with the tenant when you are not there.
Is an eleven month agreement legally weaker?
No. It is shorter than the registration threshold, which is why it is common. What makes an agreement strong is that it is properly drafted, properly executed, registered where the state requires it, and supported by a record of the handover.
Does my housing society have to approve the tenant?
Practice varies, but most societies require intimation and many issue their own no objection letter. A society cannot usually refuse a tenant on arbitrary grounds, but ignoring the process creates friction you do not want to manage from abroad.
Can the rent be paid to my family in India instead?
It can be collected by someone with authority to collect it, but it should end up in your NRO account. Rent that never touches an account in your name is difficult to evidence as your income and difficult to move out of India later.
What if I want to sell while a tenant is in occupation?
It is possible, and the agreement terms and possession position become part of the sale. Buyers discount heavily for occupied property, so most sellers plan the exit of the tenancy before going to market.
This article is for general information only and reflects rules current as of 2026. It is not legal, tax, or financial advice. Rules, rates and procedures change, and bank and operator practice varies, so please confirm the current position with a qualified professional before acting.