Liabilities of Lessee

Law > Civil Laws > Transfer of Property Act > Liabilities of Lessee

Section 108 of the Act deals with the liabilities and rights of the lessor and lessee of immovable property. In this article, we shall discuss the liabilities of lessee. Section 108 clauses (k) to (q) deals with the liabilities of lessee

Section 108: Rights and liabilities of lessor and lessee:

In the absence of a contract or local usage to the contrary, the lessor and the lessee of immoveable property, as against one another, respectively, possess the rights and are subject to the liabilities mentioned in the rules next following, or such of them as are applicable to the property leased:

(A) ………………

(B) Rights and Liabilities of the Lessee

(a) ………… (j)

(k) the lessee is bound to disclose to the lessor any fact as to the nature or extent of the interest which the lessee is about to take, of which the lessee is, and the lessor is not, aware, and which materially increases the value of such interest;

(l) the lessee is bound to pay or tender, at the proper time and place, the premium or rent to the lessor or his agent in this behalf;

(m) the lessee is bound to keep, and on the termination of the lease to restore, the property in as good condition as it was in at the time when he was put in possession, subject only to the changes caused by reasonable wear and tear or irresistible force, and to allow the lessor and his agents, at all reasonable times during the term, to enter upon the property and inspect the condition thereof and give or leave notice of any defect in such condition; and, when such defect has been caused by any act or default on the part of the lessee, his servants or agents, he is bound to make it good within three months after such notice has been given or left;

(n) if the lessee becomes aware of any proceeding to recover the property or any part thereof, or of any encroachment made upon, or any interference with, the lessor’s rights concerning such property, he is bound to give, with reasonable diligence, notice thereof to the lessor;

(o) the lessee may use the property and its products (if any) as a person of ordinary prudence would use them if they were his own; but he must not use, or permit another to use, the property for a purpose other than that for which it was leased, or fell 3[or sell] timber, pull down or damage buildings 3[belonging to the lessor, or] work mines or quarries not open when the lease was granted, or commit any other act which is destructive or permanently injurious thereto;

(p) he must not, without the lessor’s consent, erect on the property any permanent structure, except for agricultural purposes;

(q) on the determination of the lease, the lessee is bound to put the lessor into possession of the property.

• Section 108 (k) lays down that the lessee is under an obligation to disclose all related material facts which are likely to increase the value of the property for which the lessee has an interest in and the lessor is not aware of. There is no such duty when there is a contract or local usage to the contrary. This clause is not applicable to agricultural leases. In the event of non-disclosure by the lessee of an advantage taken by him, the lessor’s remedy would be not the avoidance of leases but compensation or damages.

• Section 108 (l) lays down that the lessee is under an obligation to pay the rent or premium which is settled upon in the agreement to the lessor or his agent within the prescribed time. This clause is not applicable when there is a contract or local usage to the contrary. This clause is not applicable to agricultural leases.

In Rameshwar Dayal v. Mani Lal. AIR 1977 All 534 (535) case, the Court held that once remittance of rent is proved, the presumption would arise under S. 114 of the Indian Evidence Act that ordinary course of events was followed and the amount must have been tendered to the addressee and received by him.

• Section 108 (m) lays down that the lessee is under an obligation to maintain the property in the condition that he initially got the property on commencement of the lease and he has to return it in the same condition. The changes caused by reasonable wear and tear or irresistible force are acceptable. This Section allows lessor and his agent during the term of the lease and at a reasonable time to enter upon the property and inspect its condition. The lessor is powered to give notice of any defect found and is entitled to make good, within three months after notice.

In Paritosh Ghosh v. Ashim Kumar Gupta, 2003 AIHC 291 (297,  298) (Cal) case, 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.

• Section 108 (n) lays down that if lessee gets to know about any proceedings relating to the property or any encroachment or any interference, then lessee is under an obligation to give notice to the lessor. This clause is for protection of the lessor’s interest in the property. This clause is not applicable when there is a contract or local usage to the contrary. This clause is not applicable to agricultural leases.

• Section 108 (o) lays down that the lessee has a right to use all the assets and goods which are on the property as an owner would use which is preserving it to the best of its nature. He is although under obligation to prevent any other person from using that asset or good for any other purpose from what was prescribed in the lease agreement.

• Section 108 (p) lays down that the lessee cannot attach any permanent structure without the consent of the lessor except for the purpose of agriculture.

In Rameshwar Roy v. Baidendra Kinkar Patra, AIR 1998 Cal 292 (298) case, the Court held that the clauses (m), (o) and (p) would apply only to premises demised, and none of this clause would apply in respect of other property, as property mentioned in these clauses would mean only the premises demised and not any other property or premises.

• Section 108 (q) lays down that the lessee is under an obligation to give the possession of the property back to the lessor after the expiry of the prescribed term of the lease.

In Sky Land International Pvt. Ltd. v. Kavita P. Lalwani, 2012 (191) DLT 594 (Del) case, the Court held that upon expiry of the term of the lease or termination of monthly leases by notice to quit, the lessee must vacate the property on his own and not wait for lessor to bring a suit where he can raise all kinds of contests in order to profit from Court delays.

In Santsaran v. Bankeylal Ramlal, AIR 1955 NUC 52 (MP) case, the Court held that even where the tenant has constructed a building on the land, the lessee’s obligation to restore possession to the lessor on the expiry of the leases is absolute.

In Hirabai v. Jivanlal, AIR 1955 Nag 134 (DB) case, the Court held that where the lessee wrongfully refuses to deliver possession, the lessee must pay damages to the lessor to the extent of the loss of rent suffered by latter during the period he remained out of possession.

Law > Civil Laws > Transfer of Property Act > Liabilities of Lessee