Q: Hi I have a residential row house to let in Surat, Gujarat under Surat Municipal Corporation jurisdiction.
I also have a prospective tenant. My question is this tenant would like to use my residential property for his office (commercial) purpose. Society members/chairman DO NOT have any issue with this arrangement.
But I would like things on documented and the right way.
1 - So, what formalities I have to do in order to get any clearances(local corporation) required if any.
2 - what does the tenant have to produce for the same?
3 - what are the tax implications?
4 - what kind of agreement is ideal for tenure of 1yr or 3yrs.
Generally Municipality is not strict in allowing commercial activities from private premises. However to avoid any trouble it is better if the tenant obtain Trade license to run such business.
Well, It becomes necessary to need permission from the local municipal authority for transformation of the residential property into a commercial one. And also obtain permission of municipal corporation . Enclose copy of NOC from society .
Generally, a corporate cannot use a residential property into a commercial one. However, there is a certain municipal laws or the master plan development at certain places that allows a part of residence to its owner to be used for specified commercial or office use. But before that this details can be examined with the specific municipal authority before execution. Whatever will be the other factors of the case may be, it is certainly necessary for the residence owner to get the acceptance of the housing society in a common body before using a residential property for commercial reasons. Depending on the nature of the business and also subject to the acceptance of the Housing Society, it may also be necessary to need permission from the local municipal authority for transformation of the residential property into a commercial one.