Bhubaneswar: The Odisha government has proposed making written tenancy agreements mandatory for all residential and commercial rental properties under the draft Odisha Urban Area Rent Control Act, 2026.

The draft legislation, notified by the Housing and Urban Development Department, states that no property can be rented out or occupied without a formal written tenancy agreement. The move is aimed at bringing greater transparency, reducing disputes, and creating a more accountable rental ecosystem across urban areas of the state.

Mandatory Registration of Tenancy Agreements

Under the proposed law, landlords and tenants will be required to jointly inform the designated Rent Authority and the officer-in-charge of the local police station about the tenancy within two months of signing the agreement.

If both parties fail to submit the information jointly, they must individually furnish the details in the prescribed format within one month.

The legislation also proposes the creation of a digital platform for registration and record management, enabling easier compliance and improved transparency.

Protection Against Arbitrary Eviction

One of the key features of the draft Act is the protection it offers tenants against eviction during the validity period of a tenancy agreement. Landlords will not be able to evict tenants unless such conditions are specified in writing or permitted under provisions of the proposed law.

The legislation identifies specific grounds for eviction, including non-payment of rent, unauthorised subletting, misuse of the property, and situations where major repairs or redevelopment are necessary.

Rules for Rent Payment and Receipts

The draft provides safeguards for tenants in cases where landlords refuse to accept rent or issue receipts. In such situations, tenants may send rent through postal money order or any other prescribed mode for two consecutive months.

If the landlord continues to refuse the payment, the tenant can deposit the rent directly with the Rent Authority.

Security Deposit Limits Fixed

To prevent excessive security deposit demands, the proposed law caps the deposit amount at:

• Two months' rent for residential properties.

• Six months' rent for commercial establishments.

The provision seeks to strike a balance between the interests of landlords and tenants while making rental accommodation more accessible.

Clear Guidelines on Property Maintenance and Entry

The draft Act clearly outlines maintenance responsibilities and protects tenants from arbitrary disconnection of essential services such as water and electricity.

It also places restrictions on landlords entering rented premises. Except in emergency situations, landlords or property managers must provide at least 24 hours' prior notice, either in writing or electronically, before entering the property.

The law further states that entry before sunrise or after sunset will not be permitted except during emergencies.

Restrictions on Tenants

The proposed legislation bars tenants from making structural changes or constructing permanent fixtures without obtaining written consent from the landlord.

Additionally, tenants found filing frivolous complaints before the Rent Authority regarding discontinuation of essential services may face penalties of up to twice the monthly rent.

Faster Resolution of Rental Disputes

To ensure quicker settlement of disputes, the draft proposes a three-tier dispute resolution framework comprising:

• Rent Authority

• Rent Court

• Rent Tribunal

Most rental disputes are expected to be resolved within 60 days, while eviction-related cases should be disposed of within 90 days.

Linked to PMAY-U 2.0 Reforms

The proposed legislation is part of a broader set of urban reforms being undertaken under the Memorandum of Agreement signed with the Ministry of Housing and Urban Affairs for the implementation of Pradhan Mantri Awas Yojana-Urban (PMAY-U) 2.0.

As part of these commitments, Odisha has adapted the Centre's Model Tenancy Act to address state-specific requirements and proposed its implementation through the Odisha Urban Area Rent Control Act, 2026.

Once enacted, the law is expected to formalise rental arrangements, improve legal certainty, and provide stronger safeguards for both landlords and tenants across Odisha's urban areas.