The rental of property in Chandigarh is subject to the provisions of the East Punjab Urban Rent Restriction Act of 1949 which was extended to Chandigarh by a government notification.

This Act was enacted for the purpose of stabilizing the wild swings in the property rental markets in Punjab in the aftermath of the partition of Punjab in 1947. In order to protect multitudes that had migrated from the erstwhile western Punjab, this Act was intended to provide safeguards against the exploitation of tenants at the hand of opportunist landlords.

Primarily, the Act provided for the control of rent of urban properties. The Act made it illegal for landlords to increase the rent arbitrarily and instead sought to link the potential increase in property rentals with the wholesale price index. It was hoped that this would ensure that the rents kept pace with inflation and thus in practical terms, the rents were pegged at the same real amount, as agreed between the landlord and tenant at the commencement of the tenancy.

» Read more: A case for the repeal of the extant landlord – tenant law in Chandigarh