Q. What is the difference between “Commencement Date” and “Execution Date” and “Effective Date” in a Registered Rent Agreement?
Ans: According to the “Indian Contract Act 1872” Commencement Date or the Effective date is the date from when the Registered Rent Agreement begins or commences. It could be any other day specified by the contracting parties, other than the date of signature. However, Execution Date is the date on which the parties to the Registered Rent Agreement, i.e the Lessor or the Lessee signs the contract.
Q. What is the most suitable date for the commencement date in a Registered Rent Agreement?
Ans: An agreement is allowed to be commenced and executed only after the Government fees, i.e the Stamp Duty and the Registration fee is paid. So, the Commencement date of the Leave and License Agreement should always precede the date of payment of Government fees. However, a maximum delay of 24 hours in buying the Stamp duty and registration after the commencement date or the Execution Date is permitted.
Note: In the Online procedure of Leave and License Agreement – Registered Rent Agreement, date of execution begins as soon as any single party to the agreement (Licensor/Licensee/Witness) provides his/her fingerprint scans and photos.