Sample of Lease Deed

LEASE DEED

THIS DEED OF LEASE entered into at (CITY) on this xx/xx/20xx between (Lessor’s Name) r/o (Address of the lessor), hereinafter referred to as “Lessor” which includes all his heirs, successors and legal assigns being ONE PART;

AND

(Name of the organisation/person) represented through its Director (Name of the director) having its registered office at (Address of the Director) hereinafter referred to as “LESSEE” which includes the organization, managers, and subsidiaries being the OTHER PART.

WHEREAS:

The lessor has ownership of the land (details of the land including its measurement and proper address). The lessor acquired the said land through a will on (Date) drawn by his father (Name of the father), herein referred to as “Land”.

The lessee owns a business of production of clothes and already has another production unit at (City). The lessee is willing to expand the existing business, and the lessee has requested for granting of the said land of the lessor for setting up another production unit to increase the production rate.

The lessor has granted permission to the lessee to use of the land for 15 years considering all the accepted terms and conditions mentioned herein.

The lessor has proven his title over the said land. The land is free from any existing claims, doubts or encumbrances.

NOW THIS DEED WITNESSETH AS FOLLOWS:

The Lessor has agreed to give his plot of land (measurement and the address of the said land) to the lessee on lease for a time period of 15 years.

The Lessee is under an obligation to pay a lease rent of Rs. 50,000/- (Rupees Fifty Thousand) per annum starting from (the date from which payment will be made to the lessor). Such annual lease rent shall be payable by the first 15 days of the first month of the year. If the lessee fails to pay the rent on time, the lessee will be under an obligation to pay an interest of 5% per annum. Upon failure of the said condition, the lessor will have a right to revoke the lease agreement along with other courses available.

The Lessee Hereby Agrees to the Following Covenants:

• To develop the land and set up a production unit for the clothes.
• To pay all taxes, assessments, dues, and other duties to be paid with respect to the leased land to the respective state government or the respective other local or public body. During the time of the lease, if the lessor pays any of the said amounts, the lessee shall reimburse the same amount to the lessor.
• The lessee cannot dispose of or sell the leased land or perform any act which can negatively affect the title of the land of the lessor without any prior permission of the lessor.
• To keep all the plants, machinery, and buildings insured to indemnify any losses, if any.
• To use the land only for the said purpose, i.e., for the production of clothes. Use of the said land other than the decided purpose can only be made after the consent of the lessor.
• To build, occupy and maintain the said land with the applicability of all the prevailing rules and regulations.
• To authorize the Lessor or his agent to enter the said land and constructed building at a reasonable time for inspection provided the Lessor shall not thereby unduly interfere with the Lessee’s production unit on the said land.

The Lessor Hereby Agrees To The Following Covenants:

• The lessor has full and complete ownership of the said land and has the full authority to convey such land as a lease to the lessee.
• The Lessee must peacefully hold, possess and benefit from the leased land, during the period of the lease without any disturbance, claims or demand at all by the Lessor or any person claiming under him.
• If any authorization or no objection certificate is necessary to be obtained from the Government or local authority for allowing the lease of the leased land, the Lessor shall obtain such certificate at his own cost.

It is hereby agreed that if any wrong has been committed by the lessee in performance of any covenants hereby stated, then on such wrong, the Lessor shall be entitled to terminate the agreement and use other available remedies at the discretion of the lessor and from the production unit that may have been constructed thereon and to take back the complete possession of the property, provided that a notice has been served to the lessee depicting his intention to terminate the lease and take back the possession of the unit constructed if the lessee fails to comply with the covenants within 15 days from the date on which the notice was served. In such an event, the lessor will have the right to forfeit the full amount.

It is Hereby Agreed Between the Parties That:

The lessee must be provided with a time period of 4 months for serving prior notice to the lessor for termination of the lease agreement in writing.

After the Duration of Lease has been Expired:

• The lessee shall hand over the possession of the said property to the lessor in good condition.
• The lessor shall refund the deposit amount kept as security after adjusting the amount which has been paid by the lessor on the lessee’s behalf.
• The lessee is under an obligation to pay off all the duties and penalties if any payable to the respective government authority.
• If the lessee fails to discharge any government liability, it has to be paid by the lessor and the lessee has to reimburse the same to the lessor.
• The building constructed over the said land must be handed over to the lessor at a depreciated book value after the termination of the lease agreement.

If the lease gets terminated, the lessor will have priority over others from purchasing property, plant, and machinery from the lessee on a mutually agreed price.

The lessor will have the right to sell or assign the land during the duration of the lease however such an act by the lessor will not affect the rights of the lessee over the enjoyment of the property during the lease period.

This agreement to lease must be executed in duplicate and the original agreement shall be retained by the lessor and its duplicate agreement by the lessee.

The lessee is under an obligation to bear all the costs related to stamp duty, registration fee and other necessary expenses with regard to the lease agreement. The Lessor shall pay all other costs made by him inclusive of his Advocate’s fees.

The said agreement is governed by the provisions of the laws of the (State). If any of the provisions of the agreement is unenforceable, the rest agreement will be enforceable and valid.

In case of any dispute between the lessor and lessee with regard to any disagreement between them, the parties shall discuss the matter and try to resolve the matter themselves. If such discussion fails to provide a mutually agreed decision, then the parties can settle the dispute with the help of provisions stated under the Arbitration and Conciliation Act, 1996. The parties are allowed to seek equitable relief from the competent court(District court of the state) having jurisdiction to entertain the matter.

SCHEDULE OF THE PROPERTY

• Details of the property (measurement and the address)
• Duration of lease
• Decided lease rental

IN WITNESS WHEREOF, THE LESSOR AND THE LESSEES HAVE PUT THEIR RESPECTIVE HANDS ON THE ORIGINAL AND DUPLICATE THEREOF THE DAY AND YEAR FIRST HEREINABOVE WRITTEN.

• Name and Signature of the lessor
• Name and Signature of the witness
• Name of the lessee
• Represented by
• Name and signature of the director
• Name and signature of the witness