Landlord Not Returning Deposit? Know Your Rights

One of my clients recently had a case which I am explaining below and if you are stuck in such similar situation, here is what to do.

Note: Due to attorney-client privilege, I cannot disclose complete case details or identify the actual parties involved. However, I am sharing the essential facts and legal approach so that if you find yourself in a similar situation, you can understand the available solutions and legal remedies.

TL;DR: A landlord cannot keep your security deposit to pay for ordinary wear and tear, or for repainting and refurbishing his own flat after a long tenancy. He can deduct only what he can actually prove you damaged, with bills to match. If he withholds the deposit without justification, you can send a legal notice and file a civil suit for recovery, and his counter-demand for extra repair money usually collapses unless he has hard proof.

The message came in the middle of July: hand over the flat by month-end. A buyer was ready. Six years of paying rent on time, a 10% increase accepted every year without argument, and now three weeks to find a new house.

Rohan Deshmukh had rented a 3BHK in Warangal from Suresh Kulkarni in 2019. He moved in two days after the previous tenants left. The signed agreement gave him two months' notice. That notice never came. Instead, a written message on 10 July 2025 asked him to vacate by month-end, and on 15 July the owner said the flat was sold,

and that the deposit would be settled once the sale was registered.

Rohan did not fight it. He found another flat, moved his furniture over two weekends, swept the place out on the last morning, and handed over the keys on 30 July. He had lived there for six years. He had repainted the hall himself in the third year, with the owner's go-ahead, because his mother was visiting and the old paint had gone grey. That is not a legal point. It is just the sort of thing a person remembers when the deposit does not come back.

There was no reply for a while. Then the accounting arrived: painting, polishing, and a broken fitting or two, adding up to more than the amount being held. The flat apparently needed repainting before the buyer moved in. So the deposit was gone, and there was a shortfall Rohan was being asked to pay.

I am working from what Rohan has told me. I have not seen a single bill from Kulkarni, and I have not heard his side of the handover. It is entirely possible the flat was in worse shape than Rohan thinks. But a flat that has had paying tenants in it for six years, with paint that has been on the walls since 2019, is a flat that needs repainting whoever lives in it next.

Key facts

• Tenancy began in 2019 — a 3BHK in Warangal, taken from the owner, Suresh Kulkarni.
• A written rent agreement was signed. It provided for two months' notice.
• Rent was increased by 10% every year and paid without dispute.
• On 10 July 2025, the owner asked for possession by month-end — three weeks. A buyer was ready.
• On 15 July 2025, the owner confirmed the flat had been sold and said the deposit would be sorted out after registration.
• Possession was handed over on 30 July 2025.
• The deposit was not returned. Instead, the owner raised charges for painting and polishing that exceeded the deposit, and demanded the difference.
• No bills or receipts for the alleged work have been produced.

Can a landlord deduct painting charges from your security deposit?

Usually, no. Not for ordinary wear and tear, and not for the repainting an owner does between tenants so the flat can be shown or sold. A deposit is the tenant's money held as security. It is not a budget the owner gets to draw on when he decides the flat needs a facelift.

The law in India has three layers, and they stack in this order.

1. The rent agreement comes first

Whatever the signed agreement says about the deposit governs, as long as it is not contrary to law. Most agreements say the deposit is refundable at the time of vacating, less "unpaid dues and damages". Some add a clause letting the owner deduct painting charges. If your agreement has that clause, read it carefully — courts have read such clauses narrowly, and a blanket "landlord may deduct for painting and cleaning" clause is often treated as applying to damage, not to routine repainting. But an express, clearly worded clause will carry weight, and that is a real risk in a deposit case.

2. Where the agreement is silent, the Transfer of Property Act fills the gap

Section 108 of the Transfer of Property Act, 1882 sets out the default rights and liabilities of a lessor and lessee where there is no contract to the contrary. Clause (m) of that section puts the duty on the tenant to hand the property back in as good a condition as it was in when he took possession — "subject only to the changes caused by reasonable wear and tear or irresistible force".

That phrase does the work in most deposit disputes. Paint fades. Grout darkens. Floor polish wears off where people walk. Nail holes appear where pictures hung. Curtain rods leave marks. None of that is damage; it is what living in a house does to it, and the tenant is not paying for it.

3. What the landlord has to prove to deduct anything

This is where most deductions fall apart. To keep even part of a deposit, the owner has to show:

• The specific damage — which wall, which fitting, what was broken, and that it was not there when you moved in.
• That it is damage, not wear — a cracked floor tile is damage. A tired floor is not.
• The actual cost of repair — a bill or an estimate for that item, not a round figure picked off a mental list.
• That the amount deducted reflects the age of the item — a 6-year-old paint job is not replaced at the tenant's cost in full. You do not pay new for old.

A demand for repainting of the whole flat on top of that, with no itemised bill, is not a defence. It is the claim the tenant ends up suing on.

A quick note on the Model Tenancy Act

Several States have adopted the Model Tenancy Act, 2021 in some form, and where it applies it requires the security deposit to be refunded within one month of the tenant vacating, after deducting only what is actually owed, with reasons in writing. Telangana has its own rent control statute and its own practice. Check which law applies to your building before assuming what the deadline is.

"But my landlord told me to leave in three weeks"

Different problem, and worth separating from the deposit.

Section 106 of the Transfer of Property Act requires 15 days' notice to end a month-to-month tenancy, unless the lease says otherwise. If the lease is for a fixed term, it ends by efflux of time and no notice is needed at all. Here, the agreement gave two months. A three-week message asking for possession because a buyer is waiting is not compliance with that clause.

It is also not an eviction. A notice to vacate is a request backed by contract. If the tenant does not go , the owner has to sue for possession — under the rent control statute that applies to the building, or by way of an ejectment suit in the civil court. He has to prove his grounds. A message telling you a buyer is waiting is not a ground. It is pressure.

That matters here even though Rohan has already left. He went because the owner wanted the flat empty for the sale, not because he defaulted. When a landlord pushes a tenant out early to sell, he loses the standing to turn around and complain about the state of a flat he wanted vacated. Some courts are unimpressed by that sequence.

How do I recover a security deposit with painting charges deducted?

There are three stages, and most deposits come back at the first one.

Stage 1 — Put the demand in writing and itemise it

Send a written message or email to the owner. Keep it short and factual:

• The date you handed over possession.
• The deposit amount paid, and the date you paid it.
• A statement that you dispute the charges, because no itemised bill has been given.
• A request for refund within a stated period — seven to fifteen days is usual.

Do not get into the merits on a long thread. You want a clean paper trail: what you asked for, when, and what he said. If he refuses in writing, that refusal is worth more to you later than anything you can say now.

Stage 2 — The legal notice

If stage one is ignored, a lawyer sends a notice demanding refund, with a fresh deadline. This is where most smaller claims end. Not because the owner suddenly sees reason, but because a notice tells him two things: the tenant has engaged counsel, and the tenant is prepared to litigate. A demand that was costing him nothing to ignore now has a price attached.

Note the difference between a demand notice and a notice under Section 80 CPC. Section 80 applies only to suits against the government or a public officer. Between two private parties, a legal notice is not mandatory — it is tactical.

Stage 3 — The suit for recovery

If the notice does not work, the remedy is a civil suit for recovery of money, filed before the court that has jurisdiction over the area where the flat is, or where the owner resides or carries on business, depending on the value of the claim. Where the amount falls within the pecuniary limit of the Small Causes Court, the suit is tried there, which is faster than a regular civil suit.

Where the claim arises from a written agreement and is for a fixed sum, it is sometimes filed as a summary suit under Order XXXVII of the Code of Civil Procedure. In a summary suit, the defendant has to apply for leave to defend and show a real defence. If he cannot, the plaintiff gets a decree without a full trial. Whether a deposit claim qualifies is a question the court decides — some courts entertain it, some do not — but where it is allowed, it changes the timeline considerably.

On limitation: a suit like this must be filed within three years of the cause of action — that is, three years from when the deposit became refundable and was not refunded. Three years sounds generous until you are eighteen months in and the messages have gone cold. Do not let it drift.

Who has to prove what

This is the part tenants get wrong. You do not have to prove you left the flat in good condition. He has to prove you did not.

A security deposit is the tenant's money. It sits with the owner as security, not as payment. The moment he refuses to return it and claims deductions, the burden shifts to him to justify every rupee with evidence. He needs photographs of the damage at the time of handover, an itemised bill or estimate, and something to show the damage was not already there when you moved in. On the facts I have, Kulkarni has produced none of that. A number arrived with no paper behind it.

There is also the age question. If a flat was painted in 2019 and the tenancy runs to 2025, you cannot be asked to pay for a new coat of paint at full price. You do not replace six-year-old paint at the incoming tenant's cost. Even where some liability exists, the deduction is reduced to reflect the life the item had already lived.

Can the landlord counter-demand the shortfall?

Yes, he can demand it. In a suit, he can formally raise it as a counterclaim under Order VIII Rule 6A of the Code of Civil Procedure. But a counterclaim carries the same burden as a plaint. He has to plead the damage, prove it, and prove the cost. A demand letter is not proof of anything except that he wrote a demand letter.

And a counterclaim cuts both ways. Once he puts a figure on the record, it is that figure or nothing. If he is asking for the shortfall with no bills, the court is likely to ask why. Cases that start as a tenant's claim for a refund frequently end with the landlord's counterclaim dismissed for want of evidence.

Is not returning a security deposit a criminal offence?

Some notices threaten a complaint for criminal breach of trust, which is now Section 316 of the Bharatiya Nyaya Sanhita, 2023. I would be cautious about leaning on that.

Deposit disputes are generally treated as civil claims. A criminal case is difficult to sustain where the deposit was handed over under a rent agreement and the money was held openly, not sneaked away. Where an owner has taken the deposit, refused to refund, and disappeared — no address, no response, property abandoned — the position is different, and a complaint may be worth making. On the facts I have, Rohan's owner is answering messages. He is disputing a figure. That is a civil argument, and dressing it as a crime usually just delays the money.

What to keep, and what to send a lawyer

Deposit cases are won or lost on paper, and most of that paper is in your phone.

• The signed rent agreement, and any renewal or revision letters.
• Proof of the deposit — bank transfer, cheque image, or the receipt if one was given.
• Proof of every monthly rent paid, especially the last month.
• The notice asking you to vacate, and the message about settling after registration.
• The message or letter setting out the deductions.
• Photographs of the flat at handover. If you did not take any, say so early — do not manufacture them later.

On these facts there is a real claim for the deposit. If the flat was genuinely damaged, if there is a clause in the agreement permitting deductions for painting, or if Rohan signed a handover note recording that the flat was left in a poor condition, some of that claim weakens. I have not seen the agreement, and I have only one side of it. That is worth saying plainly rather than promising a result.

If your agreement has an express painting-deduction clause and bills exist to support it, there may be nothing left to argue on the deposit and the sensible move is to negotiate the shortfall down instead of litigating. That is also a real answer.

Frequently Asked Questions

What to send us

If you are in this position, send the rent agreement, the receipt or bank proof of the deposit, the notice asking you to vacate, and the message setting out the deductions. Add a two-line note with the dates you moved in and out, and the amount held. That is enough for us to tell you whether you have a claim worth filing.

Write to /contact-us or book a slot at /book. You can also call the chamber at +91 97295 06771 or email me@sudhirrao.com. Advocate Sudhir Rao practises before the Supreme Court of India, at Lawyers' Chamber No. 86, Supreme Court of India, New Delhi - 110001, on criminal defence, cyber crime and economic offences. Adv. Jyoti Rao (Bar Council of Delhi D/891/2023) handles family and matrimonial matters.

This article is general information about Indian law and is not legal advice on your own situation. Deposit disputes turn on the wording of your agreement, the condition of the flat and the evidence on both sides.

Advocate Sudhir Rao, Supreme Court of India