Table of Contents

What Is a Lease Extension Agreement? When Is a Lease Extension Necessary? Parties Involved in a Lease Extension Lease Extension vs Lease Renewal Documents Required for Lease Extension or Renewal How to Draft a Lease Renewal Agreement? Key Components of a Lease Extension Agreement Stamp Duty and Registration for Lease Extension Is Notarisation Sufficient for Lease Extension? Legal Validity and Effect of Lease Extension How NoBroker Can Help With Lease Extension Agreements?Frequently Asked Questions

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Lease Extension Agreement: Required Documents, Cost and Registration in India 2026

Published : February 20, 2026, 12:42 AM

Updated : February 20, 2026, 12:42 AM

Author : ANANTH

Real Estate Legal Guide & Laws

Lease Agreement

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Summary

A Lease Extension Agreement is a legal document used to extend the duration of an existing lease without creating a new contract. It outlines the revised lease period, updated rent (if applicable), and any modified terms agreed upon by the landlord and tenant. A properly drafted Lease Extension Agreement ensures continuity of tenancy, prevents disputes, and maintains legal clarity while keeping the original lease terms largely intact.

Table of Contents

What Is a Lease Extension Agreement?

A lease extension agreement is a formal written contract that extends the duration of an existing lease under either the same or slightly revised terms. It serves as a legal bridge that references the original lease deed while specifically updating the end date and the monthly rent amount. Instead of creating a new legal entity, this agreement preserves the original relationship, ensuring that all prior rules and responsibilities continue to apply to both the landlord and the tenant. [1]

When Is a Lease Extension Necessary?

In India, a formal extension is required whenever both parties wish to continue the tenancy beyond the originally agreed date. [2]

Original lease nearing expiry: When the initial 11-month or multi-year term is about to end.
Business continuity or operational stability needs: Essential for shops or offices that have established a customer base at a specific location.
Avoiding relocation or renegotiation costs: Relocating incurs significant expenses; extending the current lease is often a more cost-effective option.
Change in market rental values: A formal document is required to reflect the standard 5% to 10% annual rent increase.
Compliance with internal or regulatory documentation requirements: Necessary for claiming HRA tax benefits or providing a valid address proof for government IDs.

Parties Involved in a Lease Extension

A lease extension primarily involves the original signatories, though witnesses play an important role in validating the signatures. [3]

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Lessor (landlord): The legal owner who grants the right to use the property for an additional period.
Lessee (tenant): The individual or company who occupies the space and pays the revised rent.
Role of authorised signatories: In corporate leases, a director or manager with a Power of Attorney must sign the document.

Lease Extension vs Lease Renewal

Understanding the difference between an extension and a lease renewal agreement is key to choosing the right legal path for your property.

Feature	Lease Extension	Lease Renewal
Legal Effect	Prolongs the life of the original contract.	Ends the old contract and starts a fresh one.
Documentation	Handled via a simple addendum or amendment.	Requires a completely new deed to be drafted.
Impact on Terms	Retains original terms "mutatis mutandis."	Allows for a total overhaul of rules and rent.
Cost Efficiency	Generally more affordable with lower stamp duty.	Involves full stamp duty and registration fees.
Registration	Mandatory if the total stay exceeds 12 months.	Mandatory for any new term of 12+ months.

Documents Required for Lease Extension or Renewal

To finalize a lease extension agreement, certain supporting documents are required to verify the parties' identities and the property ownership.

Original lease agreement/lease deed: This is the primary reference for the extension.
ID and address proof of landlord and tenant: Aadhaar cards or Passports are typically required.
Property ownership documents: A copy of the Sale Deed or the latest Property Tax receipt.
Latest rent receipts: To prove that there are no outstanding arrears from the previous term.
Draft lease extension or renewal deed: The new document prepared on e-stamp paper.
Photographs of both parties: Essential for the registration process at the Sub-Registrar's office.
Stamp duty and registration receipts: Proof of payment for the applicable government taxes.

How to Draft a Lease Renewal Agreement?

Drafting a renewal of the lease deed format involves a series of logical steps to ensure every detail is captured accurately.

Review the original lease

Go through the existing clauses to see which parts need to stay and which need to be updated for the new term.

Discuss terms with the other party

Talk to the landlord or tenant about the new rent amount and the proposed extension duration.

Prepare draft extension/renewal document

Create a written draft that clearly references the original agreement date and the registration number if it was registered.

Negotiate any revised rent or conditions

Finalize the rent escalation (usually 10% in India) and any changes to the security deposit amount.

Execute agreement with witnesses/notarization

Sign every page of the document in the presence of two witnesses and get it notarized for short-term stays.

File or register if required

If the extension is for 12 months or more, visit the local Sub-Registrar to complete the mandatory registration process.

Key Components of a Lease Extension Agreement

A well-structured lease renewal template must include specific identifiers to ensure legal robustness in court.

Names and addresses of landlord and tenant: Full legal details as per their government identification proofs.
Reference to original lease date: Mandatory mention of the initial contract to maintain legal continuity.
New lease period and revised expiry date: Clearly stated start and end dates for the extended term.
Updated rent and escalation clause: The new monthly payment amount and the next scheduled increase.
Security deposit adjustments: Any additional deposit paid to match the increased rent.
Maintenance and utilities: Confirmation of who pays for electricity, society maintenance, and water.
Termination and notice provisions: The timeframe required to end the lease (usually one to three months).
Governing law clause: Mention of the specific city where legal disputes will be handled.
Signatures of both parties: Physical signatures on the stamp paper alongside the witnesses.

Stamp Duty and Registration for Lease Extension

In India, every lease extension that creates a new term is a taxable event. Fresh stamp duty is mandatory, and the value depends on your state's laws for example, Maharashtra and Karnataka have different percentage-based duties. If the extension makes the total stay 12 months or longer, registration is compulsory. Failing to register a long-term extension makes the document inadmissible as primary evidence in a legal dispute over rent or possession.

Is Notarisation Sufficient for Lease Extension?

Whether a notary's seal is enough depends on the duration of the extension. For an 11-month lease extension, notarization is generally accepted because it verifies the signers' identities and the execution date. However, it does not replace the legal power of a registered deed. For any term exceeding one year, notarization alone is insufficient; the document must be registered with the Sub-Registrar to protect the tenant's rights against arbitrary eviction.

Legal Validity and Effect of Lease Extension

A lease extension agreement ensures the continuity of tenancy rights, protecting the tenant from being treated as a "tenant at sufferance." Legally, it binds both parties to the original clauses unless they are specifically modified in the new document. These legalities are essential for business tenants who need the right to occupy the space to maintain their licenses. It also ensures that the landlord can legally claim the escalated rent without any ambiguity.

How NoBroker Can Help With Lease Extension Agreements?

Navigating a lease extension agreement or a lease extension deed can be complex, but NoBroker makes it simple. We help landlords and tenants draft professional extension and renewal documents using legally verified templates. Whether you are dealing with a leasehold property or an unregistered lease deed, our platform supports e-stamping and registration to ensure complete legal compliance. NoBroker provides end-to-end support, making the renewal process faster, transparent, and entirely brokerage-free for both parties.

Frequently Asked Questions

Q1. What is a lease extension agreement?

Ans: It is a legal contract that extends the term of an existing lease, typically maintaining the same terms while updating the rent and end date.

Q2. How is a lease extension deed different from a renewal agreement?

Ans: An extension continues the existing contract through an addendum, while a renewal of the lease deed format creates a brand-new contract from scratch.

Q3. Do lease extension agreements need registration?

Ans: Yes, if the extension period (or the total stay) is for 12 months or more, registration with the Sub-Registrar is mandatory by law.

Q4. Can lease terms change during renewal?

Ans: Yes, a renewal allows for a full renegotiation of terms, whereas an extension typically changes only the rent and the duration of the stay.

Q5. Is a renewal of the lease deed legally binding?

Ans: Yes, as long as it is executed on proper stamp paper and registered (if required), it is a fully binding legal document in India.

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