Transfer of Property Act- Internal II

Hypothetical Based Questions

Submitted to: Prof. Ashish Deshpande, Prof. Akansha Singh

Submitted by:
Name- Akankshu Sodhi
PRN: 201010125364
Div: D
Course: B.A. L.L.B (Hons.) Batch: 2021-26
 INTRODUCTION

In this modern world, the life of human beings is closely related with the Properties and the
two have become interrelated and inseparable. The purchase or disposal of property requires
a legitimate legal transfer, much as social life requires contact, trade, or transfer. Due to the
lack of legislative requirements, several competing case laws arose regarding the transfer of
property under the principles of English law and equity. in India before its independence. The
situation was rectified in 1882 with the passage of the Transfer of Property Act, which to this
day establishes the parameters for the transfer of property between the living and the dead in
India. The Act, which stands as a monumental piece of legislation, lays down the legal
framework for the transfer of immovable property in India. Leasing is an important part of its
framework since it allows one party to transfer possession of real property to another for a set
or variable amount of time in return for payment. The Transfer of Property Act of 1882, in its
whole, provides a solid legal foundation for the initiation, transmission, and termination of
leasehold rights. The laws pertaining to leases of immovable property may be found in
Chapter V (Sections 105 to 117) of the Transfer of Property Act, 1882.

According to Mulla, ‘a lease is a contract between the lessor and the lessee for the
possession and profits of land, etc., on one side and the recompense by rent or other
considerations on the others’
Oxford Dictionary of Law defines it as “a contract under which an owner of property
grants another person exclusive possession of the property for an agreed period, in return
for rent and sometimes for a capital sum known as a premium.

Section 105 of the Transfer of Property Act (TPA 1) stipulates that a lease of immovable
property is a transfer of the right to use the property for a certain time, either express or
implied, or forever, in exchange for a price paid or promised, or money, a share of crops,
service, or any other thing of value that the transferee agrees to give to the transferor on a
regular basis or at certain times.
This section provides additional definitions for "lessor," "lessee," "rent," and "premium."

1
The person who transfers the property is called the lessor, and the person who receives it is
called the lessee. The price is known as the premium, while the money, portion, or other item
to be rendered is known as the rent.
It can be deduced from the preceding definitions that the fundamental concept of lease is the
separation of possession and ownership. The title remains with the lessor upon execution of
the lease-deed, while the right of enjoyment transfers to the lessee. A lease is not a transfer
of ownership but rather a transmission of a fractional interest in an immovable property.

In Byramjee Jeejeebhoy (P) Ltd. v. State of Maharashtra 2, the Supreme Court explained
that "a lease is a transfer of the right to enjoy land for a term or in perpetuity in exchange for
the price paid or promised or service or other things of value to be rendered periodically or on
specified occasions to the transferor of the property."

ILLUSTRATION- A gives his house on rent to B by executing a lease in his favour for 10
years. B is entitled to live here and if he complies with the terms and conditions, and does not
commit a breach of any condition, A cannot terminate the agreement at his will or throw B
out at his pleasure. If an option is given to the lessor by the lessee himself to resume the
leasehold, it is a personal covenant and does not create an interest in the land.

2
 ESSENTIALS OF A LEASE

Parties to a lease

Subject Matter

Transfer of Right

Duration of Lease

Consideration

FACTS OF THE CASE

According to the factual matrix, Mr. X, one of the proprietors in Baner, Pune, permitted Mr.
Y, an industrialist, to use his 1-acre property for parking for Y's retail emporium and two
theatres for an annual rental fee of Rs. 5 Lakh. The transaction described above is a lease.
Mr. X, the transferor or lessor, has leased his 1 acre property to Mr. Y, the transferee or
lessee, for an annual rent of Rs. 5 lakhs. According to the factual matrix, the tenancy began
on March 23, 2021. However, the factual matrix reveals a second transaction. After two
years, on 23rd March, 2023, Mr. X asked Mr. Y for Rs. 50 Lakh in advance as the rent for the
next ten years collectively (annual rent of Rs. Assuming Mr. Y accepts the transaction and
completes the formalities on the same day, the transaction has the characteristics of a lease,
with Mr. X as the lessor, Mr. Y as the lessee, and Rs. 50 Lakhs as the rent, as rent can be
paid periodically or in advance. Due to the fact that it is a mutual agreement that modifies an
essential provision of the original lease (advance rent instead of periodic rent), it is
equivalent to a new lease.
 ANALYSIS

The essential elements laid down under Section 1073 are -

1. Registered instrument required if lease made year to year, more than a year or if
yearly rent paid.
2. Both lessor and lessee to execute the said registered instrument.
3. Other leases can be oral or be unregistered.4

It is given in the factual matrix that the existing lease has a yearly payment of rent clause.
Therefore, it is a registered instrument. Now, it is to be shown how the existing and the future
agreements would be leases:

Essentials Existing Lease Proposed Lease

Subject The immovable property consists of The immovable property consists of
matter a one-acre parking lot for a retail a one-acre parking lot for a retail
mall and two movie theatres. mall and two movie theatres.
Transfer of The enjoyment of the right exists The enjoyment of the right exists
Right because Y has access to it and is in because Y has access to it and is in
possession of it. possession of it.
Duration Since it is not specified whether it is It is stated that Y must pay Rs. 50
temporary or permanent, it is lakhs in advance as rent for the next
presumed to be permanent. ten years. Nothing else is
mentioned about the lease. Since it
is not specified whether the
advance rent payment is time-
limited or perpetual, it is presumed
that it is perpetual.
Consideratio The consideration mentioned is Rs. There is no consideration
n 5 lakh rent to be paid per annum. mentioned. But since Rs. 50 lakh is
being paid as rent for the next 10
years in advance, it is believed that
the rent is the same, i.e. Rs. 5 lakh
3

4
AVTAR SINGH, supra note 2
 per year.
Lease to be Examining the factual matrix The proposal itself states that the
made in reveals that the rent is payable agreement would be more than a
Accordance annually, making it a registered year, requiring it to be a registered
with Section instrument pursuant to Section 107. instrument. Therefore, it is in
107. accordance with Section 107.

Given that it has been established that both contracts are leases, the proposed lease would
require modifications. According to the factual matrix, the following actions must be taken:

1. Termination of Existing Lease - The existing lease would expire, and given the
factual matrix, if both parties concur, express surrender would be the most likely
method.

2. Creation of New Lease - The new lease must be created with the following
considerations in mind:

- Advance Payment: The new lease agreement should stipulate that an

advance payment of Rs.50 lakhs, representing ten years of rent, must be
made and paid.
- Prohibition on Termination: Since an advance payment is made for 10
years, neither party may terminate the lease agreement for a period of 10
years from the beginning of the lease. If the lessor terminates the
agreement, he is responsible for paying the entire advance payment to the
lessee. If the lessee terminates the agreement, he is not entitled to a refund.
- Non-escalation of price: As a result of the 10 years of rent paid in advance,
the lessor cannot increase the rent for a period of 10 years from the date the
lease began.
- No interest in the property: The lessee cannot claim any interest in the
property other than those provided by the lessor.

The two leases outlined in the factual matrix are categorised as "commercial leases" due to
their intended use for parking and two theatres. The term "periodic leases" refers to a type of
lease that has been defined in the legal case of S. Rajdev Singh v. Punchip Associates 5as a
lease that exhibits continuity of duration from one period to the next.
The factual matrix does not explicitly indicate, however, in the case of a lease agreement
where the duration of the lease is unspecified but periodic rent is reserved or paid, there
exists a presumption of a "periodic lease". The presumed period is equivalent to the
duration for which rent is paid. According to the ruling in the case of Ashutosh v. Chandi
Charan6, the payment of Rs. 5 Lakhs in rent on a yearly basis constitutes a periodic lease.

According to Section 107 of the Act, the initial transaction involving the lease of immovable
property for a year or more must be carried out through a registered instrument. Additionally,
as per Section 107(3) of the Act, the registered instrument must be executed by both Mr. X
and Mr. Y.
In accordance with Section 107 read with 107(3) of the Act, the execution of a registered
instrument by Mr. X and Mr. Y is required for the second transaction, which pertains to a
fresh lease of the immovable property exceeding one year.

Assuming the absence of any contradictory provisions in the lease agreements executed by
Mr. X and Mr. Y, the respective rights and obligations of the lessor and lessee are stipulated
in Section 108 7of the aforementioned Act.

RIGHT AND DUTIES OF LESSOR AND LESSEE

Rights and Liabilities of the Lessor

Duty of Disclosure Duty to give Possession Covenant for quiet enjoyment

1. Duty of Disclosure [Section 108(a)]. —According to Clause (a), the lessor is

obligated to reveal to the lessee any significant flaw in the property that pertains to
its intended use, and that the lessor is aware of, but the lessee is not, and that the
lessee could not have detected with reasonable diligence. There are two distinct
5
6
7
 categories of defects, namely, those that are readily observable and those that are
not immediately discernible, commonly referred to as latent defects. The obligation
of the lessor is limited to the revelation of hidden imperfections, as these are not
ascertainable through customary diligence8. The obligation to reveal information is
of particular significance in cases where the imperfections impinge upon the
entitlement to utilise or derive pleasure from the asset.
Consequently, it is the obligation of the lessor to reveal any hidden flaws that may
impede the lessee's utilisation of the property. This particular section does not
include any stipulation regarding the title of the property, but solely pertains to the
undisturbed and peaceful use and enjoyment of said property. Consequently, the
lessor bears no obligation to reveal any flaws in the title.

2. Duty to give possession- Clause (b) says that the lessor is bound on the lessee's
request to put him in possession of the property. The aforementioned provision
entails a legal duty upon the lessor to ensure that the lessee is granted access to the
leased property. The obligation of the lessor to provide possession is contingent
upon the lessee's request for such action. In the event that a lessor neglects to
provide the lessee with possession, the lessee retains the right to initiate legal action
against the lessor in order to obtain possession. In case the lessee has already paid
rent, he may sue for damages as well as for recovering back the amount paid as
rent9. Where the lessee gets possession of only a part of the lease property he may
repudiate the lease. But where he wants to retain that part he must pay rent for that
occupied part. If the leased property is in the possession of any third person, the
lessee may also sue him along with the lessor.

3. Covenant for Quiet Enjoyment- Clause (c) provides that the lessor shall be deemed
to contract with the lessee that, if the lessee pays the rent reserved under the lease
and performs the contracts binding on the lessee, he may hold the property during
the time limited by the lease without interruption. The lessor bears the responsibility
of guaranteeing that the lessee is not subjected to any form of interference from the
lessor or any other party throughout the lease term. In cases where the lessee's
peaceful enjoyment has been disrupted, they have the right to seek compensation in

8
AIR 1974 Raj 210
9
AIR 1989 SC 1834
 the form of damages that are commensurate with the current value of the potential
profits that they have been deprived of10.

The case of Pemmarazu v. The Secretary of State of India 11established that in situations
where a lessor is incapable of providing the stipulated area to the lessee, the lessor is
obligated to provide compensation to the lessee in the form of damages.

Rights and Liabilities of the Lessee

RIGHTS OF THE LESSEE

1. RIGHT TO ENJOY ACCRETIONS TO PROPERTY

The lessee possesses the entitlement to relish the property, and any accretion shall be
considered an integral component of the lease's demise. Nevertheless, the lessee is
obligated to relinquish possession of the aforementioned property to the lessor upon
the termination of the contractual period12.

2. RIGHT TO REVOKE LEASE IN THE EVENT OF DESTRUCTION OF

PROPERTY [Section 108(e)]
The primary objective of a lease agreement is to provide the lessee with the right to
enjoy the property. However, in the event of any catastrophic occurrence, such as a
fire or flood, that significantly or entirely damages the property and hinders the
lessee's ability to enjoy it, the lessee may choose to terminate the lease agreement,
rendering it null and void13. The notification indicating the termination of the lease
takes effect immediately, and Section 106 is rendered inapplicable14.

3. RIGHT TO REPAIR PROPERTY AND CLAIM COSTS IN EVENT OF NEGLECT

BY THE LESSOR [Section 108(f)]
Throughout the duration of the lease, the lessor retains ownership of the property and
therefore bears the responsibility of ensuring that any necessary repairs are carried

10
Katyayani Debi v. Udoy Kumar Das AIR 1925 PC 27
11
1911) 34 Mad 108
12
1902 13 Cal 269
13
AIR 1965 AP167
14
AIR 1927 Bom 115
 out. Neglect on the part of the lessor resulting in the property becoming unsuitable
for habitation would be deemed unacceptable. Therefore, the lessee may claim costs
in case of damage due to neglect of the lessor15 .

4. RIGHT TO MAKE PAYMENTS OBLIGATORY ON LESSOR [Section 108(g)].—

The lessor, being the legal proprietor of the property, bears the responsibility of
remitting the land revenue and associated taxes in accordance with the laws of the
State16, unless a mutually agreed upon contract stipulates otherwise. In the event that
the lessor defaults on payment due to negligence, the lessee is entitled to make said
payment and subsequently seek reimbursement from the rent. The lessee is unable to
recover payments that are not mandated for the lessor to make.

5. RIGHT TO REMOVE FIXTURES [Section 108(h)]

During the lessee's possession, they have the right to affix any item to the property
that was not previously considered a re. And he may remove such fixture during the
possession and not afterwards, provided that he leaves the property in the state which
he received it 17.

6. RIGHT TO ASSIGN THE LEASE [Section 108(j)]

The lessee has the right to enjoy the property and acquires an interest which is
transferable and heritable . Thus, he may transfer this interest partially or absolutely
through mortgage or sub-lease. The act of sub-letting pertains to the lessee and sub-
lessee, with no involvement of the lessor 18. The practise of subletting can be
prohibited through a contract that stipulates otherwise.

LIABILITIES OF THE LESSEE

1. DUTY TO DISCLOSE FACTS [Section 108(k)]

15
AIR 1927 Oudh 609
16
1901 6 Cal 336
17
AIR 1963 All 568
18
AIR 1942 Oudh 460
 According to Clause (k), the lessee is obligated to reveal to the lessor any
information regarding the nature or scope of the interest that the lessee is going to
acquire, provided that the lessee is aware of such information but the lessor is not,
and that such information significantly enhances the value of the interest. In the event
that a lessee becomes aware of the presence of a gold mine on the leased premises, it
is incumbent upon them to disclose this information to the lessor. The non-disclosure
or neglect of the lessee to notify the lessor of such information does not constitute
fraudulent behaviour, and therefore, the lessor is not authorised to terminate the lease
agreement on such grounds. Nevertheless, the lessor retains the right to initiate legal
proceedings against the lessee for compensatory damages as held in Dr. K. A.
Dhairyawan And Others v. J. R. Thakur And Others.19

2. DUTY TO PAY RENT [Section 108(l)]

According to Clause (l), the lessee is obligated to remit the premium or rent to the
lessor or their authorised representative at the appropriate time and location. This
contractual provision has rendered the lessee responsible for remitting the rent or
premium to the lessor in a timely manner and at the designated location. The
appropriate time for the commencement of the lease term is contingent upon the
lessee's acquisition of the property, rather than the execution date of the lease
agreement. In cases where the lessee is unable to obtain full possession of the leased
property, they are entitled to request a corresponding reduction in rent. Where the
property is leased jointly to more than one person, rent paid by anyone of them will
be sufficient. Similarly, when a joint property is leased to a person, then rent paid to
anyone of the lessors will be sufficient.

3. DUTY TO MAINTAIN THE PROPERTY [Section 108(m)].

As per Clause (m), the lessee is obligated to maintain and subsequently reinstate the
property to its original state upon the conclusion of the lease agreement. The lessee is
obligated to permit the lessor and their representatives to access the premises and
assess its state, as well as report any deficiencies, at any reasonable point throughout
the duration of the lease. In the event that a defect has been incurred due to any act or
omission on the part of the lessor or their employees or representatives, it is
incumbent upon them to rectify the issue within a period of three months from the
19
Dr. K. A. Dhairyawan and Others v. J. R. Thakur And Others, 1958 AIR 789.
 time of notification. The act of a tenant creating a pipeline within the tenanted
premises for the purpose of supplying drinking water does not constitute a harmful
action towards the building

4. DUTY TO GIVE NOTICE OF ANY ENCROACHMENT [Section 108(n)]

As per clause (n), the lessee is obligated to promptly inform the lessor of any
encroachment, interference, or legal action taken to recover the property or any of its
parts that comes to their attention. This obligation requires the lessee to exercise
reasonable diligence in providing such notice to the lessor. . Upon the existence of
any defect, the lessee is obligated to rectify the same within three months of such
notice, as held in Nabin Das v. Koyla Chunder20

5. DUTY TO USE THE PROPERTY IN REASONABLE WAY [Section 108(o)].

According to Clause (o), the lessee is authorised to utilise the property and its
associated commodities in a manner that aligns with the conduct of a reasonable and
prudent individual who possesses ownership of said property. The Act was deemed to
have been violated when the tenant, who had leased the premises for the purpose of
operating a sugarcane juice business, instead utilised the space for the sale of pre-
made clothing as held in V. Pathi v. S. Udayar.21

6. DUTY NOT TO ERECT PERMANENT STRUCTURE WITHOUT LESSOR'S

CONSENT [Section 108(p)]
As per Clause (p), it is mandatory for the lessee to obtain the lessor's consent before
constructing any permanent structure on the property, except for agricultural
purposes. Only for agricultural purposes, the lessee is entitled to erect any permanent
structure on the leased property. Where the lessee constructs any permanent structure
without the permission of the lessor, he is bound to remove them without causing
damage to the tenanted property. What is a permanent structure is a question of fact; it
depends upon the nature of the structure, and the intention with which it is erected.
The term refers to a construction that possesses the ability to endure throughout the
entirety of a lease agreement and cannot be dismantled without causing significant
harm to the remaining edifice as held in Kacharulal Agarwal v. Bikram Chand.22
20
Nabin Das v. Koyla Chunder, (1911) 12 Cal LJ 483.
21
V. Pathi v. S. Udayar, AIR 1974 Ker 132.
22
Kacharulal Agarwal v. Bikram Chand, AIR 2008 Chh 194.
 7. DUTY TO RE-TRANSFER PROPERTY [Section 108(q)]
According to Clause (q), upon the termination of the lease agreement, the lessee is
obligated to return the property to the lessor's possession. The lessee is granted the
right to utilise and derive benefits from the leased property for a specified duration of
time. Upon the termination of the lease agreement, the lessee is obligated to surrender
possession of the property to the lessor. If he continues in possession even after the
expiry of the term his possession becomes unauthorised possession. In cases where
the lessee remains in possession of the leased property beyond the expiration of the
notice period, they may be held accountable for compensatory damages and mesne
profits owed to the lessor.

In Paritosh Ghosh v. Ashim Kumar Gupta 23case, where the tenant made holes in walls for
fixing air coolers, replaced brass water caps by plastic caps, in violation of leases agreement,
the eviction of the tenant was held proper.

NOTE

Section 108 does not provide for any specific right of the lessor but, because the rights and
duties are co-relative, the liabilities of the lessee, which are given under this section, are the
rights of lessor.

AUTHOR’S OBSERATION

The lessee possesses the option to resort to legal proceedings to uphold their rights, however,
there exist various technicalities that impede the lessor from pursuing legal action to enforce
the lessee's obligations. A legal loophole is present in the form of tenancy at sufferance. A
tenancy at sufferance refers to the situation where a tenant remains in lawful possession of a
property without the owner's consent. The sole differentiation between a holdover tenant at
sufferance and a trespasser lies in the fact that the former initially obtained lawful possession
but has since exceeded the permissible duration of their stay. The legal categorization of an
individual as a trespasser upon remaining on a property where they had previously held a
lease agreement may vary depending on the state's legal definitions and criteria. The initiation
of eviction proceedings is among the potential factors that could result in a tenancy of
23
2003 AIHC 291 (297, 298) (Cal)
sufferance. This scenario may arise when a lessee's lease duration elapses, yet they fail to
vacate the premises, and the lessor intends to rent out the area to fresh occupants. In the event
of a renter's noncompliance with the lease agreement, the landlord or property owner may
initiate legal proceedings to effectuate eviction. However, it is typically the case that the
tenant retains possession of the premises and cannot be subjected to forcible removal.

There are multiple factors that show that the lease is slightly biased towards the lessee. The
act provides for both but the in practical world lessor often has to suffer because of lessee's
non-compliance with the agreement. Often Lessor has to spend time and energy claiming
what actually belongs to him. After examining the rights and liabilities of both the lessor and
the lessee, we can see that, despite the fact that the lessor owns the property, the lessee is in a
better position. The lessee has custody of the property, and noncompliance by the lessee
frequently leads to the lessor taking legal action to enforce his rights. Due to the
overburdening of the courts and the pending nature of the cases, this can take years. There is
a need for a process that ensures the lessor feels safe and that he has access to a quicker and
more convenient remedy.

SUGGESTION

Currently, the Transfer of Property Act serves as the principal legislative framework
governing leases. The diverse facets of the subject matter are contingent upon the legal
regulations and other legislative measures implemented at the state or local level. The Real
Estate (Regulation and Development) Act of 2016, commonly known as RERA, aims to
enhance transparency in the real estate sector and establish effective mechanisms for
resolving disputes between parties involved in lease agreements. Therefore, X and Y have the
option to pursue said Act as a means of resolving the issue. The determination of stamp duty
on lease agreements is governed by the Stamp Duty Act, and its application varies across
different states. Moreover, it is imperative to note that the Income Tax Act of 1961 imposes
tax obligations on both parties with regards to lease agreements. Primarily, the tax burden
falls upon X, although Y may also incur the tax liability and subsequently seek
reimbursement from X. Registration of the agreement is mandatory in accordance with the
Indian Registration Act. The Indian courts and law commission have suggested the
consolidation of enactments to facilitate transactions, as a result of the diverse legislations
governing a particular aspect.

COMPARISON AND CONCLUSION

Thus, upon drawing parallels between the aforementioned provisions and the hypothetical
situation enumerated in the factual matrix, the following conclusion can be drawn.

Rights and Duties of Mr. X

In both instances of lease transactions, the lessor is identified as Mr. X. In accordance with
Section 108(a), it is incumbent upon Mr. X to divulge any significant flaw in the leased
property that he is privy to, but Mr. Y is not, and that cannot be detected through ordinary
diligence. For instance, if Mr. X is aware of a subsurface crack that was unearthed during a
land survey and that, if left unaddressed, could result in the collapse of any structure built
over it, it is his responsibility to disclose this information to Mr. Y, who would not be able to
identify such a concealed yet consequential defect through ordinary care.
In accordance with Section 108(b), it is incumbent upon Mr. X to ensure that Mr. Y is
granted possession of the premises that are subject to the lease agreement. As per Section
108(c), it is incumbent upon Mr. X to ensure the unimpeded utilisation of the leased premises
by Mr. Y, subject to the latter's adherence to the lease terms and fulfilment of his contractual
obligations, including timely payment of rent.
The discourse delves into the rights of Mr. X, which encompass the entitlement to the
restoration of the leased property to its initial state, the right to receive rent, and the right to
ensure the reasonable utilisation of the leased premises, among other rights. Additionally, the
duties of Mr. Y, the lessee, are expounded upon to circumvent redundancy and address any
potential lexical gaps.

Rights and Duties of Mr. Y

In both instances of lease transactions, the individual identified as Mr. Y assumes the role of
the lessee. Given that the leased premises will be utilised for parking purposes, it will
necessitate the installation or attachment of various items, including but not limited to cable
covers, guards, parking signs, speed bumps, and cones. In addition, the leased property is
intended to house two theatres, which will require the acquisition of projectors, screens,
sound systems, seating, and other related items. As per Section 108(d), it can be inferred that
Mr. Y is entitled to the benefits of any improvements made to the leased property, on the
condition that he returns the property to its original state upon the termination of the lease.
The aforementioned entitlement must be construed in conjunction with the right accorded
under Section 108(h), which confers upon Mr. Y the authority to detach all accessions affixed
to the land, subject to the condition that he reinstates the property to its initial state, as
mandated by Section 108(m). It follows, therefore, that it is also a duty of Mr. Y to not erect
any permanent structures such as shelter and booth, in the leased premise without Mr X’s
consent, as per Section 108(p).
As per Section 108(e), in the event that the leased property or a significant portion thereof is
damaged or rendered unusable to the extent that it is no longer suitable for its intended
purpose during the term of the lease, such as in the case of an earthquake that causes
irreparable cracks in the parking area and theatres, thereby rendering the property unsuitable
for use as a parking area and theatres, Mr. Y has the option to terminate the lease. In the event
that Mr. Y's own actions result in damage, such as a fire caused by his gross negligence that
destroys the leased premises' parking area and theatres, he would be ineligible to benefit from
the aforementioned provision in accordance with the legal principle of "Nullus Commodum
Capere Potest De Injuria Sua Propria".

Rights and Duties of Mr. X and Y in relation to each other

Section 108(f) stipulates that in the event that Mr. X fails to make necessary repairs to the
leased premises within a reasonable timeframe after being made aware of them, including but
not limited to water pipe leakage in parking areas or theatres, and Mr. Y undertakes the
repairs himself, he is entitled to deduct the expenses incurred from the rent or seek
reimbursement from Mr. X.
As per Section 108(g), in the event that Mr. X fails to fulfil his financial obligations
pertaining to the rented premises, including but not limited to property tax and electricity
bills, Mr. Y is authorised to cover the expenses and subsequently deduct the incurred amount
from the rent or seek reimbursement from Mr. X.
In accordance with Section 108(j) of the relevant legislation, M. Y is authorised to transfer
the interest in the leased premises, specifically the parking space and theatres, to a third party
through sub-lease or mortgage. Furthermore, the recipient of such an interest is also permitted
to transfer it to other individuals in accordance with Section 109 of the Act.
In accordance with Section 108(k), it is incumbent upon Mr. Y to divulge any pertinent
information that may augment the value of the leased property to Mr. X. For instance, if Mr.
Y unearths gold ores during excavation of the leased premises, he is obligated to disclose this
discovery to Mr. X, as it has the potential to enhance the value of the interest in the leased
property.
As per Section 108(l), it is mandatory for Mr. Y to make a payment of Rs. 5 lakhs towards
rent on the 23rd of March every year from 2021 to 2023. Additionally, Mr. Y is required to
make an advance payment of Rs. 50 lakhs towards the subsequent ten years at the designated
time and location.
In accordance with Section 108(m), it is incumbent upon Mr. Y to permit the ingress of Mr.
X or his authorised representatives onto the leased premises for the purpose of conducting an
inspection. In the event that any deficiencies in the condition of the leased premises are
discovered during the inspection, such as a depression in the ground resulting from a
vehicular collision in the parking area, Mr. Y is required to remedy the issue within a period
of three months from the date of notification by Mr. X. In accordance with Section 108(n),
Mr. Y is obligated to inform Mr. X upon receiving notification of any encroachment or
interference on the leased property.
According to Section 108(o), Mr. Y is required to exercise prudence and reason in the
utilisation of the accessions and is prohibited from permitting the leased premises to be
utilised for purposes other than those for which it was leased. Specifically, Mr. Y is not
permitted to utilise the leased premises as a location for hosting celebrations or as a
restaurant. Upon the conclusion of the lease agreement, it is incumbent upon Mr. Y to return
the leased property to Mr. X.