1. What is the Pagadi System
a. Traditional tenancy arrangement common in Mumbai and Maharashtra
b. Tenant pays a large lump sum (pagadi) to landlord and then pays nominal rent
c. Tenant enjoys heritable tenancy rights and can transfer tenancy with landlord’s consent
d. Unique to Maharashtra and regulated under rent control laws
2. Legal Basis under Maharashtra Rent Control Act, 1999?
a. Act consolidates earlier rent laws including Bombay Rent Act
b. Protects tenants under pagadi system from arbitrary eviction
c. Section 7 and related provisions recognize tenancy rights of pagadi occupants
d. Restricts rent increases and ensures fair treatment of tenants
3. Who Can Claim Rights under Pagadi System?
a. Tenants holding property under pagadi arrangement
b. Legal heirs inheriting tenancy rights after tenant’s death
c. Sub-tenants or transferees with landlord’s approval
d. Occupants covered under registered tenancy or recognized by municipal records
4. Process and Rules under the Act?
a. Tenant pays nominal rent after initial pagadi lump sum payment
b. Any transfer of tenancy requires landlord’s permission
c. Tenant can nominate legal heir for succession of tenancy rights
d. Eviction permitted only on limited grounds such as default of rent, unauthorized use, or redevelopment
e. Redevelopment projects provide compensation or alternate accommodation to pagadi tenants
5. Transfer of Tenancy Rights and Registration
a.On death of a tenant, tenancy rights pass automatically to legal heirs residing with the tenant at the time of death
b. Legal heirs must notify landlord and continue paying rent to establish their status
c. Tenancy rights can be transferred to another person with the landlord’s consent, usually on payment of fresh pagadi
d. A deed of transfer of tenancy is executed between outgoing tenant, incoming tenant, and landlord
e. This deed is registered at the sub-registrar’s office to make the transfer legally valid
f. Municipal records such as property tax register are updated to reflect new tenant’s name
6. Role of a Lawyer in Pagadi System Matters
a. Advises tenants and legal heirs on inheritance of tenancy rights
b. Assists in preparation of tenancy transfer deeds and registration at sub-registrar office
c. Represents tenants or landlords in disputes relating to succession, eviction, or redevelopment
d. Ensures proper compensation, alternate accommodation, or share of transfer amount during redevelopment
e. Protects tenants’ statutory rights under Maharashtra Rent Control Act
FAQs on Pagadi System
Tenant pays a lump sum upfront and enjoys protected tenancy rights with low rent
No, eviction is allowed only on specific grounds under Maharashtra Rent Control Act
Yes, tenancy rights automatically pass to legal heirs living with the tenant at the time of death
By obtaining landlord’s consent, executing a transfer deed, and registering it at the sub-registrar’s office
Transfer deed, landlord’s consent, rent receipts, identity proofs, and municipal records
Yes, landlords usually receive a share of the pagadi when tenancy rights are transferred
No, they only have tenancy rights, not ownership of the property
Tenants are entitled to alternate accommodation or compensation, and tenancy rights continue in redeveloped premises
Yes, but only with landlord’s approval and proper registration of transfer
Rent Control Courts or Small Causes Courts in Maharashtra