Hi,
I have a property in Delhi that is on a commercially notified road as per Master Plan 2021. I plan to rent it out to a retail chain.

One of the clause in the deed give the Lessee, the exclusive right to terminate the deed. (Which I have been told is the general trend)

As of today the rent rates are ok compared to taxes we need to pay. But in case the tax rates increase or govt imposes new taxes (which are generally very high), my profit would come down considerably.

On negotiating with the lessee that have agreed to share burden in case the tax rates increase (on property tax, conversion charge & carparking charge) but in case there is a new tax they are reluctant to take care of it.

Considering the fact that I can not terminate the deed even if it does not remain profitable I want to add something that protects me from any unreasonable increase in taxes.

Could you please advise if it is a general trend that the landlords agree to BOTH of the following clauses (how big is the risk to agree to them)
1. Lessee has the exclusive right to terminate the deed (which is around 10 years)
2. All the taxes related to property is bone by the landlord (irrespective of rental rates)

Thanks in Advance
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  • In this case, you can ask for
    (1) termination (notice period) of atleast 1 year
    (2) get back proprty as it was rented out in original condition
    (3) secure right to increase rent after initial lock-in period of say 3 years or something similar (this will protect you from un-wanted additional burden)
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