Agreement-To-Lease (ATL) Vs Lease Deed

Here are some steps for Lease Deed between an Allottee and the Authority:

1. After a certain time, Allottees are informed that they can now take physical possession of the plots, but only after depositing the lease money, which is normally 10% of the total amount of the plot/property, payable to the authority.

2. Allottee approaches the authority to sign Lease Deed, by depositing the lease money in prescribed bank. At this point, Lease Deed format is printed on Stamp Papers (as instructed) and the same is signed by the representatives of the Authority.

3. Once Lease Deed is signed, Authority hands over the physical possession of the plot to the Allottee (Possession Certificate is issued).

4. Finally, the Allottee has to get the Lease Deed registered at Sub-Registrar’s office, within 90 days of signing of the Lease Deed. Failing which, the Lease Deed will be considered invalid and void.

Normally due to pressure from state revenue department on the authority to generate revenue and given that the Authority is not in the position of providing physical possession at any given point of time, hence unable to sign actual Lease Deed, a mid-way acceptable to all is derived, called “Agreement-To-Lease”, where in all parties benefit.

“Agreement-To-Lease” or ATL, is not a Lease Deed. It is simply an agreement between the allottee and the authority that the allottee will pay for and sign the Lease Agreement as and when the possession is provided by the Authority. Thereby, the revenue department gets the registration revenue right away (without waiting for years) and the allottee saves money by having to pay registration money at allotment rates (which are always considerably lower than then existing circle rates).

The only catch, so far, has been that once the ATL is signed, Authority refuses to transfer the ownership of allotment rights. Authority is actually correct in doing so. As there is an existing agreement between party A, the authority and party B, the allottee... and the terms of agreements will only be fulfilled once the physical possession is provided, therefore authority cannot break the law by ignoring/overwriting any existing agreement.

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