Chapter I INTRODUCTION 111. Determination of lease
A lease of immovable property determines(a) by efflux of the time limited thereby, (b) where such time is limited conditionally on the happening of some event-by the happening of
such event. (c) where the interest of the lessor in the property terminates on, or his power to dispose of the
same extends only to, the happening of any event-by the happening of such event. (d) in case the interests of the lessee and the lessor in the whole of the prop erty become vested at
the same time in one person in the same right. c ase the lessee yields up his interest under the lease to (e) by express surrender, that is to say, in case the lessor, by mutual agreement between them. (f ) by implied surrender. (g) by forfeiture; that is to say, (1) in case the lessee b reaks an express condition which provides
that, on breach thereof, the lessor may ma y re-enter; or (2) in case the lessee renounces h is character as such by setting up a title in a third person or by claiming title in himself; or (3) the lessee is adjudicated an insolvent and the lease provides that the lessor may re-enter on the happening of such event; and in any an y of these cases the lessor or his transferee gives notice in writing to the lessee of his intention to determine the lease. (h ) on the expiration of a notice to determine the lease, or to quit, or of intention to quit, the
property leased, duly given by one party to the other.
Chapter II Clause (a): Efflux Of Time Leases for a definite period expire on the last day of the term, and the lessor or any other person entitled to the reversion may enter without notice or other formality provided there is no 'holding over' within the meaning of sec. 116. Accordingly, clause (a) has to be read with sec. 116. Where before the determination of the lease by efflux of time the lessee applies to the custodian for confirmation of the lease under sec. 5A. East Punjab Evacuees' Administration of Property) Act, 1947 and the custodian impliedly assents to his continuing in possession, the lessee does not 1
become a trespasser — Th akar Das V Custodian
Tenancy getting terminated by efflux of time, tenant is not entitled to any statutory notice to quit 2
— P. S. Bcdi v Project & Equ ipment Corporation . The Supreme Court has reiterated this 3
principle in M . Vij ayalax mi v G. Goverdh an Reddy .
In view of the expression 'law abhors a forfeiture', which has almost become a legal maxim, a lessee is entitled to relief against forfeiture at the app ellate stage since a 'suit' includes a n 'appeal'. But when the lease stood determined by efflux of time, the grant of relief under sec. 114 would 4
be entirely out of place — Shyamlal v Nanda Rani
Since a lease does not terminate until the expiry of the term, a suit for ejectment and possession before the expiry of the period is premature: but the suit need not necessarily be dismissed, for although it is not maintainable so far as it roiates to the claim for immediate possession, the 5 landlord is entitled to a declaration of his right — Ghu lam H ussain v M ahomed Hu ssain . 6 following Sita Ram v Ram Lai . The Madras High Court holds that such a suit is not
maintainable and must be dismissed, even though the lease expires during the pendency ol the
1
AI R 1950 EP 175
2
AI R 1994 Del 255
3
(1997)11 SCC 358 AI R 1988 Cal 133 (135) 5 6 AL J 177 6 18 All 440 4
suit. The reason is that the rights of the parlies must be determined as on the date of the action 7 brought — Ramanandan v Pulik utti
No notice to quit is necessary when the action for ejectment is brought after the lease has expired and the tenancy has come to an end by efflux of time. When it is not shown that the lessors accepted rent after the termination of the lease, the lessees are tenants by sufferance, being in no better stalus than trespassers and are liable to ejcctmenl without notice — Chandi Charan v 8
9
Ashulosh and M d. Fazthzzaman v Anwar H usain .
When the interest of a mortgagee comes to an end. the lease created by him also comes to an end. To this there is an exception. Leases created either in exercise o f statutory or express powers are binding on the mortgagor after redemption if those are exercised in the course of prudent management. Whether an act is prudent or improvident has to be decided in the light of the world 10 of the past — Tar a Chand v Ganga Ram .
On redemption the tenant inducted by the 11
mortgagee has no right to be in possession — Jadavji v Navnilbhai .
A clause in the lease deed recited that il the lessee remained in possession of the shop-room after the period of lease without the consent of the lessor, he would pay one and half times rent per season. This is not a renewal clause which must be bilateral and not unilateral because the lessee's featrfty to pay enhanced rent is dependent on his possession without the sermssion of the lessor. The clause only safeguards the interests of the lessor to receive the amount from the lessee tor the use and occupation of the premises. The lessee cannot remain in possession of the premises without execution of a fresh lease deed and that having not been done, under – sec 111(a) the lessee is liable to be evicted as his tenancy has determined by efflux of time — Gulam 12
Natx v Gul am Rasool and Lease to rear and catch fish was initially granted for seven years and
was later on extended for another two years during the continuance of the agreement. Sec. 106 does not apply as the period fixed in lease was more one year. Such lease is determinable under sec 111(a) by efflux of imited by contract. Continuance of possession by temporary injunction
7
21 M ad 288 40 CWN 52 9 AI R 1932 All 314 10 AI R 1978 Delhi 58 11 AI R 1987 SC 2146 (2155) 12 AI R 1986 J& K 8
court, and ultimate permanent injunction till the defendant is evicted course of law, cannot be held to be assent by the landlord for of lessee's possession and sec. 116 does not apply — 13
Narayan M uni cipal Council
Chapter III Clause (b): Contingent Term If the term of tho lease Is limited conditionally on the happening of some event, the lease is determined by the happening of such event. Thus, where the term is limited for thirty years if the lessee shall so long live, the lease is terminable at the end of thirty years or upon the death of the 14 lessee, which event may first happen — Chauth mal v Sardarm al
A lease for 99 years granted to a company provided inter alia that in case the company goes into liquidation voluntarily or otherwise, it will cease to be operative. The company went into liquidalion: Held that clause (d) die- not apply — Sri nath Zamin dary , in re AI R 1952 Cal 207 . Where a lease for 40 years contained a clause that if the lessee carried on any business other than manufacture ol salt, the lease would stand cancelled; held that clause (b) did not apply — 15
Kr ishna Chandra v National Chemical
Where an employee of the landlord occupying a building is liable to be evicted on ceasing to be in employment, the tenancy is governed by sec. 111 (b), T.P. Act and no notice under sec. 106, 16
T.P. Act is necessary for terminating the tenancy — Pratap Narain v J. K. I ron & Steel Co. .
When a lease is created by the mortgagee in possession, the lessee cannot claim any right beyond the term of the original lessor's intercsl unless recognised as lessee by the mortgagor on 17
redemption — Sachalmal Parasr am v Ratna Bai
If the maximum duration of the term is fixed (the term may be for any length of time but there must be a definite limit), the lease may bo subject to determination within the period; and this
13
AI R AI R 15 AI R 16 AI R 17 AI R 14
1991 On 179 1959 Raj 24 1957 On 35 1975 All 73 1972 SC 637
may be provided either by a provision that Ihe lease may be determined by notice on a given 18
event, as for example, upon the termination ot a war [ Great Nor thern Rty Co. v Arnol d ] , or by a provision that the lease is to endure only during the continuation of a specified state of affairs, as for instance, while the lessee remains in the lessor's employment, or continues to occupy the premises, so that upon the state of affairs ceasing the lease automatically determines 19
— H alsbury' s L aws of En gland
18
19
(1916)33 TL R 114 4th E d.. Vol. 27. para 207.
Chapter III Clause (c): Termination Of Lessor's Interest Or Power Where the lessor's interest is limited, the lease comes to an end with the extinguishment of that 20
interest — Raghuvir Sin gh v Jethu . If the lessor holds the property for his own life or for the life of another, the lease would terminate on the death of himself or that other person. A lease granted by a Hindu widow would fall under this clause. Such a lease is. however, voidable and 21
not void on the grantor's death — M a& u Sudan v Rooke . Where the husband, the contracting party, surrenders the lease, the wife has no legal right to stay on. She becomes a trespasser — 22
Sumatilai v M onorama . This clause does not mean that if in the exercise of his power of due
management the mortgagee has entered into an agreement of tenancy, on the mere redemption of 23 the mortgage the tenancy would automatically lapse — H ardie v Wahi d . A lease from year to
year granted by the manager of a temple in course of management does no: come to an end with the expiry of the office of the manager or his successors — Atyam V eerr aju v Pechetti 24
Venkanna . In the case of a lease under sec. 76(a) the lease terminates on the extinction of the 25
mortgage by redemption — C. K. Kuttapan v Kari hi yayani . On redemption the tenant inducted 26
by the mortgagee has no nght to be in possession — Jadavji v Navni dbhai . A tenant inducted into possession of an urban building or premises by a usufructuary mortgagee does not retain his status as a tenant alter redemption of Ihe mortgage. He is not entitled to protection under the Rajasthan Premises (Control of Rent and Eviction) Act, 1950 — Gouri Shank ar v Kapoor 27
Chand
20
AI R 1923 Pat 130 25 Cal 1 (PC), 24 I A 164 22 (1977)18 GLR 512 23 AI R 1954 All 16 24 AI R 1966 SC 629 25 AI R 1981 Ker 107 26 AI R 1987 SC 2145 27 AI R 1983 Raj 79 21
Chapter IV Clause (d): Merger The common law doctrine of merger is statutorily embodied in clause (d) ot sec. 111 of the T.P. Act. The doctrine of merger as contemplated in clause (d) conlemplates (i) coalescence of the interest of the lessee and the interest of Ihe lessor, (ii) in the whole of the property, (iii) at the same time, (iv) in one person, and (v) in the same right. There must be a complete union of the whole interests of the lessor and the lessee so as to enable the lesser interest of the lessee sinking into the larger interest of the lessor in the reversion — T L akshmi pathi v P. Ni thyananda 28
Rcddy . In mis case the apex court has approved the following decisions which relate to 29
thedoctrine of merger: Badr i N arai n v Rameshwar D ayal .
The principle underlying the doctrine ol merger has been discussed in notes under sec. 101. The doctrine of merger stands statutorily incorporated in clause (d) ot sec. 111 and has lo be read 30 along with sec. 109 of the Act and not in isolation - Nal akath v Koonk adan . Under this clause
a merger takes place when the tenant acquires the immediate reversion, and the greater estate and the less coincide in the same person without any intermediate estate — Sur aj Chandr a v Behari 31
L al . Merger is largely a question of intention, dependent on circumstances, and courts will 32
presume against it when it operates to the disadvantage of a party — Natakal h v Koonk adan . "Merger" is generally defined as the absorption of a thing of less importance by a greater, whereby the lesser ceases to exisl but the greater is not increased, and rights are said to be
merged when the same person who is bound to pay is also entitled lo receive — Pacif ic States 33
Savings & L oan Co. v Slr obeck .
The maxim ―ne mo potest esse tenons et dominu” . i.e.
— nobody can be both a l andl ord an d tenant at th e same time (in respect of the same property) 34
Prosonn o v Jagut Ch un dcr .
Explaining the underlying principles of "merger". L ohoti J . observes: 28
(2003)5 SCC 150 AI R 1951 SC 186 30 (2002)6 SCC 1 31 AI R 1939 Cal 692 (695) 32 (2002)6 SCC 1 33 139 Cal A pp 427 34 3 ClR 159 29
"A merger, at law, is defined to be where a greater estate and a lesser coincide and meet in one and the same person, in one and the same right, without any intermediate estate. The less estate is immediately annihilated, or, in the law phrase, is said to be merged — that is. sunk or drowned — in the greater. Thus, if there be a tenant for years, and the reversion in fee simple descends to or is purchsed by him, the term of years is merged in the inhentance. The rule in equity is the same as at law. with this modification; that at law it is invariable and inflexible; in equity it is controlled by the expressed or implied intention ol the parly in whom the interest or estates unite. Merger is founded on the principle that two estates — one larger and one smaller cannol — and need not — coexist, if the smaller estate can in equity, and must in law. sink or merge into the 35
larger estate' — Nalakat . The principle ot merger enunciated in this clause equally applies whore the merger takes place by virtue of transfers by operation of law — Prontotho Nath v 36
Kali Prosonno .
35 36
Supra 28 Cal 744
Chapter V Clause (e): Express Surrender Section 111 provides for vahous circumstances when the lease of immovable property comes to an end. It contemplates surrender — either express as under clause (e) or implied under clause 37
(f ) — Kamalabai v M angilal . For a valid and binding surrender it is not always essential for
the lessee to deliver possession of leasehold property to the lessor. This will bo clear from the 38
following observations of the apex court in Kamalabai v M angilal
"It is thus clear that when the parties surrendered the tenancy and substituted it by a fresh arrangement merely because physically the possession was not handed over is not of much consequence. Apparently in the present case also by mutual agreement, the tenancy came to an end and by arbitration what was sought was an arrangement for time on payment of damages for use and occupation. Admittedly, it did not either continue the old tenancy or started a new one. This substitution of new arrangement and the determination of the old by mutual agreement clearly indicates that the tenant surrendered his tenancy right and Ihe court below was not right in coming lo Ihe conclusion that the surrender is not there as possession was not handed over". In either case it is an yielding up of the term of lessee's interest to him who has the immediate reversion or the lessor's interest. It takes effect like a contract by mutual consent on the lessor's acceptance of the act of the lessee. The lessee cannot, therefore, surrender unless the term is vested in him; and the surrender must be to a person in whom the immediate reversion expectant on the term is vested. There must be a taking of possession, not necessarily a physical taking, but something amounting to a virtual taking of possession. Whether this has occurred is a question of 39 fact — Shah M athur a Das v Nagappa . This clause applies only to leases which can be
surrendered; where a lease is entered into for a definite term, and there is a covenant in it expressly forbidding surrender by the tenant before the expiry of the term, this clause has no 40
application — Jotindra M ohan v Emam Ali . In cases of surrender, one has to look to the 37
(1987)4 SCC 585 Supra 39 AI R 1976 SC 1565 40 9 CLJ 632 38
41
substance of the transaction — Kashi prasad v Bedprasad . A formal deed of reconveyance is 42
not necessary to effect a valid surrender — I mambandi v Kamaleswari . Where the original lease is registered, the surrender of a portion of the tenancy with an abatement of rent can be effected only by a registered instrument — B. Ahmed M aracair v 43
Mathuvaliappa . Surrender consists in the yielding up of the term by the lessee to the lessor
accompanied by delivery of possession and the acceptance of the same by the lessor. Where the Government takes possession of the property under a requisition order, it takes the possession from both the lessor and lessee. It cannot therefore, operate as a surrender so as to terminate the 44
temancy — Tar abai v Padamchand . Where in spite of a letter by the tenant that he would surrender tne lease by a certain date the landlord allows him to continue in possession beyond the 45
intimated period, the original tenancy must be held to be subsisting — Gosta B ehah v Ramosh .
A relinquishment in writing without a surrender of possession on the part of the tenant does not constitute a sufficient right in the landlord to recover possession by means of a suit in ejectment 46
— Amar N ath v H ar Prasad .
There can be no valid surrender unless the surrender lakes place by mutual agreement between the lessor and lessee. Therefore, the lessee cannot make a valid surrender by merely giving notice to his landlord that he is going to relinquish the land, and the mere fact that the landlord silently receives the notice, which the lessee has no legal right to give, cannot be regarded as an 47 assent to the relinquishment — Ju doonath v Scheone, Ki lbu m & Co . If the lessor has
mortgaged the land as well as the right to recover the rent, the lessee cannot make a surrender of his lease in favour of the lessor, because it was not competent to the lessor to accept the surrender withoul the concurrence of the mortgagee. The right to agree to the surrender of the lease did not remain in the lessor-mortgagor but passed lo the mortgagee, and without the latter's
41
AI R 1940 Nag 113 14 Cal 109 (119) (PC) 43 AI R 1961 M ad 28. 42
44
AI R 1950 Bom 89 AI R 1978 Cal 23S 46 AI R 1932 Oudh 79 45
47
9 Cal 671
consent the surrender was not valid. Consequently, the lessee remained liable to pay rent to the 48 mortgagee — H avu v Ganapati .
Chapter V Clause (f): Implied Surrender An implied surrender takes place either by the creation of new relationship between the lessor and lessee, such as the acceptance of a new lease, or in other ways based on ihe consent of the parties, or by relinquishment of possession by the lessee and taking over of possession by the lessor which would lead to the inference of an implied surrender of me lease — Amar Kr ishna v 49
Nazir H asan 14 L uck 723 .
50
An implied surrender can be inferred trom the conduct ot the parties — Kon ejeti v Thammana .
The principle which governs the doctrine of implied surrender of a lease is that when certain relationship existed between two parties in respect of a subject-matter and a new relationship has come into existence regarding the same subject-matter, the two sets cannot co-exist, being inconsistent and incompatible between each other i.e. if the latter can come into effect only on termination of the former, then it would be doomed to have beon terminated in order to enable the latter to operate. A mere alteration or improvement or even impairment of the former relationship would not ipso facto amount to implied surrender. It has to be ascertained on the terms of the new relationship vis-a-vis the erstwhile demise and then judging whether there was 51
termination of the old jural relationship by implication — T.K. L athi ka v Seth K arsandas
A surrender does not follow from a mere agreement made during the tenancy tor the reduction or 52 increase of rent, unless there is a special reason to infer a new demise — Gappalal v Shi raji . It
is not necessary that in order to operate as a sunender. the new lease should be of the same duration as the existing lease. If a lessee for twenly years takes a new lease lor ten years, the old 48
AI R 1930 Bom 329 (330). AI R 1939 Oudh 257 50 AI R 1957 AP 619 51 (1999)7 Supr eme 601 52 AI R 1969 SC 1291 49
lease is of the new relationship vis-a-vis the erstwhile demise and then judging whothcr there 53 was termination of the old jural relationship by implication — T.K. L athi ka v Seth K arsandas .
On the death of a tenant the tenancy right is inherited by all his heirs who hold the same as tenants-in-common or co-tenants and not as joint tenants. The fact that letter of attornment did not mention the names of some of the heirs and they also did not assert their rights cannot have the effect of determining their rights or cannot amount to an implied surrender — I ndra Sharma 54
v Gopal D ass
In the absence of evidence creating a new tenancy, implied surrender of the lease originally held 55 cannot be presumed — Sushi l v Nar ayan . Where the new lease is void or voidable or does not
pass an interest according to the contract the acceptance of ii does not operate as a surrender of 56 the original lease — Jamini M ohan v Debendra .
53
(1999)7 Supr eme 601 AI R 1985 Del 118 55 AI R 1978 Cal 174 56 AI R 1924 Cal 355 54
Chapter VI Clause (g): By Forfeiture By forfeiture; that is to say, (1) in case the lessee breaks an express condition which provides that, on breach thereof, the lessor may re- enter or (2) in case the lessee renounces his character as such by setting up a title in a third person or by claiming title in himself or (3) the lessee is adjudicated an insolvent and the lease provides that the lessor may re- enter on the happening of such event and in 3[ any of these cases] the lessor or his transferee 4[ gives notice in writing to the lessee of] his intention to determine the lease:
57
Case : Yashpal L ala Shi v Narain vs Al latala Tala M alik Waqf Aj akhan
57
http://indiankanoon.org/doc/1270013/
Chapter VII Clause (h): Notice To Quit A breach of a condition, as explained earlier, only makes the lease voidable. It is to be remembered that the forfeiture is not complete unless and until the lessor gives notice that he has 58 exercised his option lo determine the lease — Asghar v U.P, Govern ment . The Supreme Court
has ruled that the requirement of a written notice is a statutory formality and this requirement cannot be said to be based on any general rule ot justice, equity and good conscience. Hence it is not applicable to leases executed betore April 1930 when the Amending Act of 1929 came into 59
force — Namdeo Lokman L odhi v Narmadabai .
Sale of property under lease without determination of the lease by notice under sec. 111(g) would be void as in that case the lease would be subsisting and the owner of the land had no right to sell it with vacant possession and unecumbered with the lease. The consideration paid 60 therefore failed — Chadrawati v Sur endr a .
Where a suit for eviction is instituted before the ex piry of the period of the notice but the plaint is subsequently amended by stating that the claim for possession has matured during the suit, the 61
suit cannot be dismissed as premature — Pundlik v M amraj . A notice terminating the tenancy 62
in part is invalid — Ghasi Ram v Jagat Narai n .
If a lease is granted by a municipality, it can be terminated by the municipality according lo law. and only by issuing a proper notice as required by the Transfer of Property Act, because the municipality is not outside the provisions of this Act. The municipality cannot determine the iease by simply sassing a resolution, and then and there requiring the lessee to quit — Amnultah 63
v Emp .
58
AI R 1954 All 649 AI R 1953 SC 228 60 AI R 1979 All 406 61 1969 M ad LJ (notes) 23 62 AI R 1976 All 221 63 AI R 1928 All 95 59
Where a notice under sec. 111(h) has been given, it is not necessary to give also a notice under 64 sec. 111(g) on the ground of forfeiture of the lease — M ooi Chand v I shwar L al . Bui if the
lessor does not serve the requisite notice under sec 111(g) read with sec. 114A, the lease would 65 be deemed to be subsisting — Chandrawati Devi v Surendra L ai Singh .
Landlord agreed to sell the property to the tenant on payment of the purchase money in equal instalments and on failure to make payments the sale agreement would stand cancelled. Tenant did not pay even the first instalment. The landlord then filed a suit for possession of the property without giving one month's notice. Held that after the cancellation of the agreement Ihe tenantappellants cannot be said to have stood restored lo their original position as tenants. Hence the 66
suit can be filed without giving notice under the T.P. Act — Arj unlal v Girish Chandra In a case there was lease of a shed and not of land underneath it. When the shed had collapsed and the tenant reconstructed the shed and continued to possess the same, the issuance of notice for termination of the lease was not required as the subject-matter of the lease got destroyed and 67 with that the lease came to an end — Phu lan D evi v Anand Saroop .
64
AI R 1974 Raj 163 AI R 1979 All 406 66 AI R 1973 SC 2256 65
67
1995 AI H C 1590 (H P)
CONCLUSION Sec 11 of Transfer of Property Act 1882 i:e Determination of Lease is a very wide topic and covers a large segment of day todays life issues. A lease or tenancy may come to an end in the following ways. It should, however, be noted that the effect of this Section has been practically superseded by varous Rent Control and Eviction Acts passed by various State Legislature fr e.g., By Lapse of time; By happening of a specified event; By termination of lessor’s interest; By merger; By surrender; By implied surrender; By forfeiture; On the expiration of the notice to quit.
