Definition of lease Under Section 105 of Transfer of Property Act : 

              A lease of immovable property is a transfer of a right to enjoy such property, made for a
certain time, express or implied, or in perpetuity, in consideration of a price paid or promised, or
of money, a share of crops, service or any other thing of value, to be rendered periodically or on
specified occasions to the transferor by the transferee, who accepts the transfer on such terms.

Lessor, lessee, premium and rent defined : 

             1) Lessor : The transferor is called the lessor,

             2) Lessee: The transferee is called the lessee,

            3) Premium : the price is called the premium, and;

            4) Rent : the money, share, service or other thing to be so rendered is called the rent.

What are the essentials of a lease?

o Parties must be competent: The parties in a lease agreement should be competent

to enter into a contract. Lesser should be entitled to a property and have absolute
rights over that property.
o Right of possession: Ownership rights are not transferred in a lease, only the
possession of the property is transferred.
o Rent: Consideration for a lease can be taken in the form of a rent or premium.
o Acceptance: Lessee, who is to get the interest in the property after lease, has to
accept the lease agreement along with the time period and terms & conditions
imposed on the transfer.
o Time Period: Lease always takes place for a particular time period which is to be
specified in the lease agreement. It can be relaxed at the option of the lessor.

Determination of lease means termination or end of contract of lease and thereby legal
relation between lessor and lessee comes to an end. Section 111 of T.P. Act deals with
various circumstances in which a lease is terminated. Section 111 of lays down :-
A lease of immoveable property determines :-

(a) By efflux of time limited thereby :- Where lease is created for certain duration lease
comes to end on expiry of that duration. In P.S. Bedi v. Project and Equipment Corpt. of
India Ltd., AIR 1994 Del. 255 it was held that where tenancy is to be terminated by
efflux of time, the tenant is not entitled to any statutory notice to quit.

(b) Where such time is limited conditionally on the happening of some event - by
happening of such event.:- So when the term of the lease is related to some event or it
depends upon the happening of a specified event then the lease terminates on the
happening of that event. In this connection clause (b) of section 11 provides that a lease
of immovable property determines where such time is limited conditionally on the
happening of some event by the happening of such event. Thus a lease for life of the
lessee terminates on the death of the lessee."

(c) By Termination of Lessor's Interest :- 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.

This clause operates where the lessor has only a limited interest. A lease by a Hindu
widow would come to an end on her death; a lease granted by a mortgagee in possession
determines on redemption because a mortgagee in possession cannot grant a lease
extending beyond the term of the mortgage. The legal position in this connection is very
clear. The mortgagee in possession must, on redemption, restore possession of the
mortgaged property to the mortgagor in the same condition as it was at the time when it
was mortgaged.

(d) Merger :- In case the interest of lessee and the lessor in whole of the property
become vested at the same time in one person in the same right. So Section 111(d) of Act
deals with doctrine of merger. When two estates merge into one or unite, it is called
merger.

In Ramesh Kumar Jhambh v. Official Assignee, High Court Bombay, AIR 1993 Bom.
374 it was observed that the doctrine of merger is atracted when a lease hold and
reversion coincide. If the lessee purchases the lessor's interest, the lease is relinquished as
the same person cannot at the same time be both landlord and tenant. The doctrine of
merger is based on principle of union of two conflicting interests which cannot be held by
one person at the same time.

(e) By Express Surrender :- By express surrender, that is to say, in case the lessee yields
up his interest under the lease to the lessor, by mutual agreement between them.

(f) By Implied Surrender :- Section 111(f) of Act contemplates determination by

implied surrender.

Illustration - A lessee accepts from his lessor a new lease of the property leased, to take
effect during the continuance of the existing lease. This is an implied surrender of the
former lease and such lease determines thereupon.

In P.M.C. Kunhiraman Nair v. C.R. Nagaratha Iyer, AIR 1993 SC 307 - it was
observed that there can be implied, surrender, if the lessor grants a new lease to a third
person with assent of lessee under the existing lease who delivers the possession to such
person or where lessee directs his such tenant to pay rent directly to the lessor.
(g) By Forfeiture :- Section 111(g) provides "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 any 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 Notice to Quit -- Clause (h) of section 111 lays down that
lease of immovable property determines 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. The periodic leases like leases from year to year or from month to month are
terminated by notice to quit under section 106 T.P. Act. On termination of tenancy by
notice the relationship of landlord and tenant comes to an end and acceptance of money
as rent does not automatically amount to the waiver of the notice to quit. It is the
intention of the landlord which is material i.e. whether he intended to waive notice by
accepting money as rent or he intended not to waive it off and accepted the amount as
damages for wrongful use and occupation and not as rent. If the notice is not in
accordance with law it is invalid.