TPA-II

Unit-IV
DETERMINATION OF LEASE

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 property become
vested at the same time in one person in the same right,
(e) 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,
(g) 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 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.

S. 111 lays down the modes in which lease can be terminated.

1. By Efflux of Time (S. 111 (a): Where the term of the lease is fixed, the lease
determines after the expiry of time period automatically. In case of a lease for a fixed
period, no notice to quit is necessary.
Unregistered lease deed cannot be determined by efflux of time.
When tenancy is determined by efflux of time, no notice to quit is necessary.
Where the lessee remains to continue in passion of the leased property even after the
determination of lease, he is not known trespasser but lessee at sufferance. He will have
to pay the compensation to the compensation to the lessor for the use and enjoyment of
the property beyond the time period of the lease.
2. By Happening of Some Event (S. 111 (b): Where the lease contains a condition that
the lease will terminate on the happening of some even, it will terminate on the
happening of that event.
3. Termination of Lessor’s Interest in property (S. 111(c): This Clause provides that a
lease of immovable property determines where the interest of the lessor in the property
terminates.
4. By Merger (S. 111 (d): The doctrine of merger is attracted when a leasehold and
revision 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 the principle of union of two conflicting interests which cannot be
held by one person at the same time. Therefore, the leasehold rights in favour of the
appellants stand extinguished; Ramesh Kumar Jhambh v. Official Assignee, High Court
Bombay, AIR 1993 Bom 374.

to be continued……………………..

5. By Express Surrender (S. 111 (e): That is to say, the lessee yields up his interest
under the lease to the lessor, by material agreement between them. Surrender is opposite
of merger. In a merger the larger interest is merged with smaller interest whereas in
surrender the smaller interest unites with larger interest. But in both, the lease is
determined because two interests unite. However, mere relinquishment of ‘right to enjoy’
is not sufficient; it must be followed by delivery of possession. Surrender without
delivery of possession in ineffectual. Surrender need not be in writing. It can be done
orally by delivery of possession.
6. By Implied Surrender (S. 111(f): An implied surrender takes place either by the
creation of new relationship between the lessor and the lessee or by the relinquishment of
possession by the lessee and taking over by the lessor.
When a lessee accepts from the lessor a new lease of the same property which is already
leased to him, there is implied surrender of the earlier lease. The former lease is impliedly
determined. When a lessee accepts an office inconsistent with lease, there is implied
surrender.
The principle behind the implied surrender is that when a certain relationship existed
between two parties in respect of a subject matter and a new relationship has come into
existence regarding the same subject, the two sets cannot co-exist being incompatible and
inconsistent with each other, the former is deemed to have terminated in order to enable
the latter to operate.
It was held in PMC Kunhiraman Nair v. CR NagaratnaIyer AIR 1993 SC 307 that there
can be implied surrender, if the lessor grants a new lease to a third person with the assent
of the lessee under the existing lease who delivers the possession to such person or where
the lessee directs his sub tenant to pay the rent directly to the lessor.
7. By Forfeiture (Section 111(g): This clause provides that a lease terminates by
forfeiture in the following circumstances:-
(a) in the case lessee breaks on express condition which provides that on breach of it, the
lessor may re-enter the property, or
(b) 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
(c) the lessee is adjudicated an insolvent and the lease provides that the lessor may re-
enter on the happening of such event.
(i) Breach of Express Condition
The lease terminates when the express condition is broken by the lessee which had
provided that in case of breach of the condition by the lessee the lessor will re-enter the
leased property. The right of forfeiture is exercised only when the condition is in fact
broken. In the case of Nil Madhabv. Narottam (1890) 17 Cal.826, the lease deed
contained an express condition that the lessee shall not alienate his leasehold, but he
alienated the property in violation of the condition. It was held that the lessor can not
forfeit property because the lease deed did not contain provision for re-entry.
(ii) Denial of Title
The second condition for forfeiture arises when the lessee denies the lessors’ right and
sets up a title in himself or in a third person. Here the lessee denies his lessors’ title and
asserts that he or some third person is the true owner. The lessor in such a case becomes
entitle to forfeit the tenancy. Repudiation of title or denial of title must be clear and
relatable to the knowledge of the lessor. (Guru Amarjeet Singh V. Ratan Chand, AIR
1994 SC 227)
The tenant denied title of the land lord during proceedings before the Rent Controllers.
As a result thereof the landlord issued a notice of termination of tenancy. The act of
repudiation of title in a judicial proceedings was a a deliberate and conscious act. The
tenant therefore incurred forfeiture of tenancy. The landlord became entitled to recover
possession. (Narendra Vyankrtesh Tambat v. Praveen Kumar Khushalchand Tated, AIR
2015 NOC 1279 BOM.)
(iii) Insolvency
Where the lease deed contains a condition that in case the lessee is adjudicated insolvent
the lessor will re-enter the property and where actually the lessee is adjudicated insolvent,
the lessor will forfeit the lease. Notice in writing is necessary to forfeit the lease in such a
case.
8. On Expiration of Notice to Quit (Section 111(h):
Clause (h) provides that the lease of immovable property may determine 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. (Dwarka das Hiralallahoti v. Kazi
Mumbarzuddin, AIR 2007 (NOC) 1636 BOM.)
A lease terminates when the notice to quit or to determine expires. Under Section 106,
periodic leases, like leases from month to month or from year to year are terminated by
notice to quit. No notice is necessary in case of leases for fixed term.
A one year lease carried a condition in the rent deed that the lessee would vacate the shop
when required by the landlord for her use. It was held that the notice under S. 111(h) was
proper. She became entitled to the decree of the eviction. She was not required to prove
that the shop was required by her for her personal use. (Vijay Kumar v. Harbhajan Kaur,
AIR 2013 NOC 217 J&K)