Urban Development Minister Kanubhai Desai has placed the Gujarat Rent Bill, 2026 before the state assembly during its three-day monsoon session in Gandhinagar. The bill would repeal the Gujarat Rents, Hotel and Lodging House Rates Control Act of 1947 and put a written contract, rather than a state-fixed ceiling, at the centre of every tenancy in the state.
Two provisions matter most to anyone paying rent in Ahmedabad, Surat, Rajkot or Vadodara. Security deposits would be capped at three months’ rent, and a landlord would have to return the money within a month of getting vacant possession. Written agreements become compulsory rather than optional, which is a real shift in a rental market where lakhs of tenancies still run on an eleven-month understanding and a handshake.
Why the 1947 law had to go
The 1947 statute came out of a post-war housing shortage and was built to freeze rents in place. Over eight decades that logic curdled. Standard rents stayed pegged near historical levels while market rents moved on, so owners of older buildings in Ahmedabad’s walled city and Vadodara’s central wards had little reason to repair anything, and tenants of those buildings had little reason to leave. Disputes went to civil courts and sat there. The state had already been extending the old Act in five-year instalments, the last of them running to March 2026, which made a replacement more or less unavoidable this year.
The three-tier machinery
Instead of civil courts, the bill sets up a ladder that DeshGujarat reports as three tiers:
- Rent Authority: headed by a Deputy Collector or Assistant Municipal Commissioner, registering agreements and handling routine matters.
- Rent Court: headed by an Additional Collector or Deputy Municipal Commissioner.
- Rent Tribunal: headed by District Judges, sitting at the top of the appeal chain.
The drafters have written timelines into the law: 60 days for a case at the authority level, with eviction proceedings pegged at 30 to 90 days depending on the ground. Loktej reported ahead of the session that the outer limit for settling a rent dispute would be two years. Set that against the current position, where a possession suit in a Gujarat civil court can outlive the person who filed it.
The bill also gives tenants protections that were left to negotiation. A landlord must give 24 hours’ written notice before entering the premises. Cutting off water, power or gas to force someone out would invite compensation of up to two months’ rent. Coverage extends to residential and commercial premises under the state’s 2017 development regulations, while industrial property, government housing and registered Waqf property stay outside unless both sides opt in.
What it means for tenants and owners
For a tenant, the deposit cap is the immediate gain. Brokers in Ahmedabad’s west-side corridors ask for four to six months up front, and recovering that money at the end of a tenancy is often a matter of pleading. A statutory ceiling and a one-month refund clock give a tenant something to point at.
For an owner, the trade is predictability. Landlords have avoided long tenancies for decades because a tenant who stops paying cannot be removed within a useful timeframe. If the rent courts hold to their timelines, that calculation changes, and some of Gujarat’s locked-up housing stock may come back onto the rental market. That is the theory behind the Model Tenancy Act the Centre circulated in 2021, which several states have now adapted.
What to watch
Passing the bill is the easy part. The harder question is staffing: Deputy Collectors and Additional Collectors already carry heavy loads, and a rent authority that takes six months to register an agreement relocates the backlog. Watch for the rules notified after the Act commences, the date from which existing tenancies must convert to written agreements, and whether the state provides separate staff for the rent courts in the eight municipal corporations rather than adding the work to existing desks.
Sources: DeshGujarat, Loktej, TV9 Gujarati
This report was written with AI assistance from the publicly reported sources linked here; each fact was cross-checked against at least two of them.