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Transfer of Property Act MCQs for CLAT PG, Page 2

CLAT PG Transfer of Property Act questions 27-53 of 80, with answer keys and explanations covering sale, mortgage, lease, gift, exchange, actionable claims, lis pendens, election, and part performance.

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Revise core LLB subjects through CLAT PG MCQs, passage-led questions, answer keys, explanations, statutes, and exam-oriented legal principles.

  • Attestation, Animo Attestandi, Pardanashin Women5
  • Condition Restraining Alienation, Section 10, Absolute vs Partial Restraint5
  • Conditional Transfers, Restraint on Alienation, Transfer for Unborn Persons5
  • Doctrine of Notice, Constructive Notice, Actual Possession5
  • Doctrine of Notice, Constructive Notice, Lis Pendens, Priority5
  • Doctrine of Part Performance, Section 53A TPA5
  • Gift Sections 122-123, Lis Pendens Section 52, Ostensible Owner Section 415
  • Gift Sections 122-126, Attestation Advanced, Immovable Property Nuances5
  • Immovable Property, Doctrine of Fixtures, Profit a Prendre5
  • Lease Section 105, Determination Section 111, Holding Over Section 1165
  • Lease vs License, Determination, Holdover Section 1165
  • Mortgage Types Section 58, Equity of Redemption Section 605
  • Mortgage Types, Equity of Redemption, Clog on Equity5
  • Sale Section 54, Rights of Seller and Buyer Section 555
  • Transfer of Property - General Principles, Capacity, Section 8, Section 53A5
  • Transfer of Property Section 5, Partition, Will, Doctrine of Feeding the Estoppel Section 435
Passage or principleTPA Section 53A; 2001 Amendment

Section 53A of the Transfer of Property Act, 1882 embodies the doctrine of part performance. It provides that where a person contracts to transfer immovable property for consideration by a writing signed by the transferor, and the transferee has taken possession in part performance of the contract or continued in possession in part performance and has done some act in furtherance of the contract, and the transferee is willing to perform their part, then the transferor is debarred from enforcing any right against the transferee in respect of the property. Section 53A operates as a defence, not as a source of title. It is described as a shield, not a sword: the transferee can use it to resist dispossession by the transferor but cannot assert an independent title claim against third parties through this section. The protection is not available against a bona fide purchaser for value without notice of the contract or the part performance. Prior to the Registration and Other Related Laws (Amendment) Act, 2001, an unregistered written agreement could attract Section 53A. After the 2001 Amendment, the contract must also be registered for Section 53A protection to apply. An unregistered written agreement, however clearly supported by part performance, does not attract Section 53A after the amendment.

Question 27MediumDoctrine of Part Performance, Section 53A TPA

Against whom does Section 53A not provide protection to the transferee?

  1. A

    Against the original transferor

  2. B

    Against the heirs of the transferor

  3. C

    Against successive sub-lessees of the transferor

  4. D

    Against a bona fide purchaser for value without notice of the contract or the part performance

View answer and explanation

Correct answer: D. Against a bona fide purchaser for value without notice of the contract or the part performance

The passage states: "The protection is not available against a bona fide purchaser for value without notice of the contract or the part performance."

Source note: TPA Section 53A; 2001 Amendment

Question 28MediumDoctrine of Part Performance, Section 53A TPA

What significant change did the 2001 Amendment introduce for Section 53A?

  1. A

    It required the contract to also be registered for Section 53A protection; an unregistered written agreement no longer attracts Section 53A

  2. B

    It extended Section 53A protection to oral agreements with possession

  3. C

    It abolished Section 53A as redundant

  4. D

    It extended Section 53A to movable property as well

View answer and explanation

Correct answer: A. It required the contract to also be registered for Section 53A protection; an unregistered written agreement no longer attracts Section 53A

The passage states: "After the 2001 Amendment, the contract must also be registered for Section 53A protection to apply. An unregistered written agreement...does not attract Section 53A after the amendment."

Source note: TPA Section 53A; 2001 Amendment

Question 29EasyDoctrine of Part Performance, Section 53A TPA

Based on the passage, which of the following is an essential condition for invoking Section 53A?

  1. A

    The transferee must have paid the full consideration

  2. B

    The contract must have been executed before a magistrate

  3. C

    The transferee must have taken possession or continued in possession in part performance of the contract

  4. D

    The property must be in an urban area

View answer and explanation

Correct answer: C. The transferee must have taken possession or continued in possession in part performance of the contract

The passage states the section applies "where the transferee has taken possession in part performance of the contract or continued in possession in part performance and has done some act in furtherance of the contract."

Source note: TPA Section 53A; 2001 Amendment

Question 30HardDoctrine of Part Performance, Section 53A TPA

A has an unregistered written agreement to purchase land from B, and A is in possession having made improvements. The agreement was made in 2005 (after the 2001 Amendment). Can A use Section 53A if B sues for eviction?

  1. A

    Yes, because A is in possession and the agreement is in writing

  2. B

    No, because after the 2001 Amendment the agreement must also be registered for Section 53A to apply; an unregistered agreement cannot attract Section 53A

  3. C

    Yes, because improvements made by A create an independent equitable right

  4. D

    It depends on the value of the property

View answer and explanation

Correct answer: B. No, because after the 2001 Amendment the agreement must also be registered for Section 53A to apply; an unregistered agreement cannot attract Section 53A

The passage states that after the 2001 Amendment "the contract must also be registered for Section 53A protection to apply. An unregistered written agreement, however clearly supported by part performance, does not attract Section 53A after the amendment."

Source note: TPA Section 53A; 2001 Amendment

Passage or principleTPA Sections 41, 52, 122-123, 126

Section 122 of the Transfer of Property Act, 1882 defines a gift as the voluntary transfer of existing movable or immovable property without consideration, accepted by or on behalf of the donee during the donor's lifetime. If the donee dies before acceptance, the gift is void. Section 123 requires a gift of immovable property to be made by a registered instrument signed by or on behalf of the donor and attested by at least two witnesses; a gift not so made is void. For movable property, the gift may be made either by registered instrument or by delivery. Section 126 allows revocation of a gift on the happening of a specified event agreed by both parties, but a provision making a gift revocable at the mere will of the donor is void. Section 52 of the TPA embodies the doctrine of lis pendens: during the pendency of any non-collusive suit in a competent court in which a right to immovable property is directly and specifically in question, no transfer by a party to the suit shall affect the rights of the other party under any decree. Transfers pendente lite are not void but are subject to the outcome of the suit. Section 41 protects a transferee from an ostensible owner: where with the consent of the real owner a person represents himself as owner and transfers the property for consideration, the transfer is not voidable provided the transferee took reasonable care and acted in good faith.

Question 31EasyGift Sections 122-123, Lis Pendens Section 52, Ostensible Owner Section 41

According to Section 123 TPA as described in the passage, what is the consequence if a gift of immovable property is not made by a registered instrument attested by two witnesses?

  1. A

    The gift is voidable at the option of the donor

  2. B

    The gift is void

  3. C

    The gift is valid but cannot be registered later

  4. D

    The gift is valid between the parties but not against third parties

View answer and explanation

Correct answer: B. The gift is void

The passage states: "a gift not so made is void." This is unambiguous: lack of proper form makes the gift void, not merely voidable.

Source note: TPA Sections 41, 52, 122-123, 126

Question 32EasyGift Sections 122-123, Lis Pendens Section 52, Ostensible Owner Section 41

Under Section 122 TPA as described in the passage, what happens if the donee dies before accepting the gift?

  1. A

    The gift vests in the donee's heirs

  2. B

    The donor's obligation to give remains and heirs can accept

  3. C

    The gift is suspended until the heirs decide

  4. D

    The gift is void

View answer and explanation

Correct answer: D. The gift is void

The passage states: "If the donee dies before acceptance, the gift is void."

Source note: TPA Sections 41, 52, 122-123, 126

Question 33MediumGift Sections 122-123, Lis Pendens Section 52, Ostensible Owner Section 41

Under Section 126 as described in the passage, which provision relating to revocation of gifts is void?

  1. A

    A provision making the gift revocable at the mere will of the donor

  2. B

    A provision allowing revocation on the happening of a specified agreed event

  3. C

    A provision allowing the donee to refuse the gift

  4. D

    A provision allowing revocation in case of fraud

View answer and explanation

Correct answer: A. A provision making the gift revocable at the mere will of the donor

The passage states: "a provision making a gift revocable at the mere will of the donor is void."

Source note: TPA Sections 41, 52, 122-123, 126

Question 34MediumGift Sections 122-123, Lis Pendens Section 52, Ostensible Owner Section 41

According to the passage, what is the legal status of a transfer made pendente lite under Section 52?

  1. A

    Such transfers are absolutely void from the date of transfer

  2. B

    Such transfers are valid against all parties including non-parties to the suit

  3. C

    Such transfers are not void but are subject to the outcome of the suit

  4. D

    Such transfers are void only if the transferee had notice of the pending suit

View answer and explanation

Correct answer: C. Such transfers are not void but are subject to the outcome of the suit

The passage states: "Transfers pendente lite are not void but are subject to the outcome of the suit."

Source note: TPA Sections 41, 52, 122-123, 126

Question 35HardGift Sections 122-123, Lis Pendens Section 52, Ostensible Owner Section 41

For Section 41 (ostensible owner) to protect a transferee, the passage says which conditions must be satisfied?

  1. A

    Only that the transferee paid adequate consideration

  2. B

    The real owner must have consented to the ostensible owner's representation; the transfer must be for consideration.

  3. C

    Only that the property was registered in the ostensible owner's name

  4. D

    The transferee must not have had any dealings with the real owner previously

View answer and explanation

Correct answer: B. The real owner must have consented to the ostensible owner's representation; the transfer must be for consideration.

The passage states Section 41 applies "where with the consent of the real owner a person represents himself as owner and transfers the property for consideration, the transfer is not voidable provided the transferee took reasonable care and acted in good faith."

Source note: TPA Sections 41, 52, 122-123, 126

Passage or principleTPA Sections 3, 122-126; Shantabai v State of Bombay; Kartari v Kewal Krishan; Tila Bewa v Mana Bewa

Section 122 of the Transfer of Property Act, 1882 defines a gift as the voluntary transfer of certain existing movable or immovable property without consideration, accepted by or on behalf of the donee during the donor's lifetime. A gift of future property is void. Under Section 123, a gift of immovable property must be made by a registered instrument signed by or on behalf of the donor and attested by at least two witnesses; a gift not so made is void. Section 126 allows a gift to be revoked on the happening of a specified event agreed by both parties, but a provision making a gift revocable at the mere will of the donor is void. In Tila Bewa v. Mana Bewa (AIR 1962 Ori 130), the Orissa High Court held that a donor's hope that the donee would care for her was merely a motive for making the gift and not a condition with a revocation clause; since the gift deed had no revocation clause, the gift was absolute and irrevocable. In Kartari v. Kewal Krishan (AIR 1972 HP 117), the Himachal Pradesh High Court set aside a gift deed obtained by distant collaterals from an elderly widow, holding that taking a leading part in the execution of a gift deed is by itself sufficient to prove domination of the donor's will and undue influence. The Section 3 definition of immovable property, as clarified in Shantabai v. State of Bombay (AIR 1958 SC 532), distinguishes between trees (immovable) and standing timber (movable) based on the owner's intention: if the owner intends continued vegetative growth, the tree is immovable; if the tree is intended to be cut at an early date, it is standing timber (movable). Rights exercised over land, such as the right to enter and cut timber over a 12-year period, are profits a prendre and constitute immovable property.

Question 36EasyGift Sections 122-126, Attestation Advanced, Immovable Property Nuances

According to Section 122 TPA as described in the passage, a gift of future property is?

  1. A

    Void; Section 122 requires the gift to be of certain existing property

  2. B

    Valid if the donor expects to acquire the property within a reasonable time

  3. C

    Voidable at the option of the donee

  4. D

    Valid if made by a registered and attested instrument

View answer and explanation

Correct answer: A. Void; Section 122 requires the gift to be of certain existing property

The passage states: "A gift of future property is void" - this directly follows from Section 122 requirement that the gift must be of "certain existing" property.

Source note: TPA Sections 3, 122-126; Shantabai v State of Bombay; Kartari v Kewal Krishan; Tila Bewa v Mana Bewa

Question 37MediumGift Sections 122-126, Attestation Advanced, Immovable Property Nuances

In Tila Bewa v. Mana Bewa, why was the donor unable to revoke the gift when the donee did not care for her?

  1. A

    The gift had been accepted by the donee and thus became irrevocable

  2. B

    Section 126 TPA does not allow revocation based on the donee conduct

  3. C

    The gift deed contained no revocation clause; the donor hope was a motive, not a binding condition with an express provision for revocation on non-fulfillment

  4. D

    The court held that the donor had forfeited her right to revoke by accepting benefits from the donee

View answer and explanation

Correct answer: C. The gift deed contained no revocation clause; the donor hope was a motive, not a binding condition with an express provision for revocation on non-fulfillment

The passage states: "the donor hope that the donee would care for her was merely a motive for making the gift and not a condition with a revocation clause; since the gift deed had no revocation clause, the gift was absolute and irrevocable."

Source note: TPA Sections 3, 122-126; Shantabai v State of Bombay; Kartari v Kewal Krishan; Tila Bewa v Mana Bewa

Question 38HardGift Sections 122-126, Attestation Advanced, Immovable Property Nuances

In Kartari v. Kewal Krishan, what was the principle regarding gifts obtained by undue influence?

  1. A

    All gifts to distant relatives are presumed to involve undue influence

  2. B

    Taking A leading part in the execution of a gift deed is by itself sufficient to prove domination of the donor will and undue influence; the beneficiary must rebut this

  3. C

    Undue influence must always be proved by direct evidence of threats or coercion

  4. D

    Only gifts by persons over 80 years can be challenged on grounds of undue influence

View answer and explanation

Correct answer: B. Taking A leading part in the execution of a gift deed is by itself sufficient to prove domination of the donor will and undue influence; the beneficiary must rebut this

The passage states: "taking a leading part in the execution of a gift deed is by itself sufficient to prove domination of the donor will and undue influence."

Source note: TPA Sections 3, 122-126; Shantabai v State of Bombay; Kartari v Kewal Krishan; Tila Bewa v Mana Bewa

Question 39MediumGift Sections 122-126, Attestation Advanced, Immovable Property Nuances

According to the passage and the principle in Shantabai v. State of Bombay, the test for distinguishing a tree (immovable) from standing timber (movable) is?

  1. A

    Trees are always immovable; timber is always movable

  2. B

    Any tree that can be used for building purposes is automatically standing timber

  3. C

    The distinction depends on the market value of the wood

  4. D

    If the owner intends continued vegetative growth the tree is immovable; if intended to be cut at an early date, it is standing timber (movable)

View answer and explanation

Correct answer: D. If the owner intends continued vegetative growth the tree is immovable; if intended to be cut at an early date, it is standing timber (movable)

The passage states: "if the owner intends continued vegetative growth, the tree is immovable; if the tree is intended to be cut at an early date, it is standing timber (movable)."

Source note: TPA Sections 3, 122-126; Shantabai v State of Bombay; Kartari v Kewal Krishan; Tila Bewa v Mana Bewa

Question 40MediumGift Sections 122-126, Attestation Advanced, Immovable Property Nuances

According to the passage, a right to enter land and cut timber over a 12-year period is classified as?

  1. A

    A profit A prendre constituting immovable property as it is a right exercised over land involving benefits from the soil

  2. B

    A movable property right as it relates to timber

  3. C

    A contractual licence with no property character

  4. D

    Neither movable nor immovable; it is a sui generis right

View answer and explanation

Correct answer: A. A profit A prendre constituting immovable property as it is a right exercised over land involving benefits from the soil

The passage states: "Rights exercised over land, such as the right to enter and cut timber over a 12-year period, are profits a prendre and constitute immovable property."

Source note: TPA Sections 3, 122-126; Shantabai v State of Bombay; Kartari v Kewal Krishan; Tila Bewa v Mana Bewa

Passage or principleTPA Section 3; Shantabai v. State of Bombay; Duncans Industries; Bamadev Panigrahi

Section 3 of the Transfer of Property Act, 1882 provides that immovable property does not include standing timber, growing crops, or grass. The General Clauses Act, 1897 defines immovable property to include land, benefits to arise out of land, and things attached to the earth or permanently fastened to anything attached to the earth. The doctrine of fixtures, embodied in the maxim quiquid planatur solo cedit, holds that whatever is attached to the land becomes part of the land. Two tests determine whether an attached thing is immovable: the degree or mode of annexation, and the object or purpose of annexation. The purpose test is dominant in India. In Shantabai v. State of Bombay (AIR 1958 SC 532), the Supreme Court held that a right to enter forest land and cut timber over 12.5 years was not merely a right in standing timber but a profit a prendre, i.e., a benefit arising out of land, and therefore immovable property. Since the deed was unregistered and unattested, it could not be enforced. In Duncans Industries Ltd. v. State of U.P. (2000 1 SCC 633), factory machinery permanently embedded in earth was held to be immovable property because the parties' characterisation of it as movable in the deed could not alter its legal nature. In contrast, in Bamadev Panigrahi v. Monorama Raj (AIR 1974 AP 226), cinema projector and diesel engine embedded in earth for a touring cinema were movable property because the purpose of annexation was temporary.

Question 41EasyImmovable Property, Doctrine of Fixtures, Profit a Prendre

According to Section 3 of the TPA as described in the passage, which of the following is expressly excluded from immovable property?

  1. A

    Rights of way and fisheries

  2. B

    Buildings embedded in earth

  3. C

    Standing timber, growing crops, and grass

  4. D

    Benefits arising from land

View answer and explanation

Correct answer: C. Standing timber, growing crops, and grass

The passage directly states: "Section 3 of the Transfer of Property Act, 1882 provides that immovable property does not include standing timber, growing crops, or grass." The other options are forms of immovable property, not exclusions.

Source note: TPA Section 3; Shantabai v. State of Bombay; Duncans Industries; Bamadev Panigrahi

Question 42EasyImmovable Property, Doctrine of Fixtures, Profit a Prendre

What does the maxim "quiquid planatur solo cedit" mean as explained in the passage?

  1. A

    Buyers must beware of defects in property

  2. B

    Whatever is attached to the land becomes part of the land

  3. C

    A licensee has no interest in land

  4. D

    Possession is nine-tenths of the law

View answer and explanation

Correct answer: B. Whatever is attached to the land becomes part of the land

The passage states the doctrine of fixtures "is embodied in the maxim quiquid planatur solo cedit, holds that whatever is attached to the land becomes part of the land."

Source note: TPA Section 3; Shantabai v. State of Bombay; Duncans Industries; Bamadev Panigrahi

Question 43MediumImmovable Property, Doctrine of Fixtures, Profit a Prendre

According to the passage, why was the right in Shantabai v. State of Bombay held to be a profit a prendre (immovable) rather than a right in standing timber (movable)?

  1. A

    Because the deed was unregistered

  2. B

    Because the trees were fruit-bearing trees

  3. C

    Because the wife had taken possession under the deed

  4. D

    Because the right involved deriving benefit from the soil over 12.5 years, not merely taking already-felled timber

View answer and explanation

Correct answer: D. Because the right involved deriving benefit from the soil over 12.5 years, not merely taking already-felled timber

The passage explains the right was "a profit a prendre, i.e., a benefit arising out of land, and therefore immovable property." The right was not merely in standing timber but involved drawing sustenance from soil over time. The unregistered deed was a consequence, not the reason for the classification.

Source note: TPA Section 3; Shantabai v. State of Bombay; Duncans Industries; Bamadev Panigrahi

Question 44MediumImmovable Property, Doctrine of Fixtures, Profit a Prendre

In Duncans Industries, why could the parties not change the legal character of the machinery by calling it movable in their deed?

  1. A

    Because the machinery was permanently embedded in earth and its legal character as immovable property could not be altered by contractual description

  2. B

    Because government property is always immovable

  3. C

    Because the registration of the deed was defective

  4. D

    Because Section 6 TPA prohibits such transfers

View answer and explanation

Correct answer: A. Because the machinery was permanently embedded in earth and its legal character as immovable property could not be altered by contractual description

The passage states the machinery "was held to be immovable property because the parties' characterisation of it as movable in the deed could not alter its legal nature." Legal character of property is determined by objective facts, not by how parties label it in documents.

Source note: TPA Section 3; Shantabai v. State of Bombay; Duncans Industries; Bamadev Panigrahi

Question 45HardImmovable Property, Doctrine of Fixtures, Profit a Prendre

What was the decisive distinguishing factor between Duncans Industries (machinery held immovable) and Bamadev Panigrahi (cinema equipment held movable)?

  1. A

    The monetary value of the equipment

  2. B

    Whether the equipment could physically be removed

  3. C

    The purpose of annexation: permanent use for a fixed factory versus temporary use for a touring cinema

  4. D

    Whether the equipment was owned by the landowner

View answer and explanation

Correct answer: C. The purpose of annexation: permanent use for a fixed factory versus temporary use for a touring cinema

The passage states the purpose test is dominant in India. Duncans: permanently embedded for a factory. Bamadev: "because the purpose of annexation was temporary" for a touring cinema. Purpose, not physical attachment, was decisive.

Source note: TPA Section 3; Shantabai v. State of Bombay; Duncans Industries; Bamadev Panigrahi

Passage or principleTPA Sections 105, 108, 111, 116

A lease under Section 105 of the Transfer of Property Act, 1882 is a transfer of the right to enjoy immovable property for a certain time or in perpetuity in consideration of premium or rent. The lessor retains ownership; only the right of enjoyment is transferred. Leases from year to year or exceeding one year or reserving yearly rent must be made by registered instruments executed by both parties. Section 108 specifies rights and liabilities of lessor and lessee. Under Section 108(b), if the lessor neglects to make repairs after notice, the lessee may make the repairs and deduct costs from rent. Under Section 108(e), if a material part of the property is wholly destroyed by fire, flood, or irresistible force, rendering it permanently unfit for the purpose for which it was let, the lessee may avoid the lease. Section 111 provides eight modes of determination of a lease including: efflux of time, happening of a specified event, termination of the lessor's interest, merger, express surrender, implied surrender, forfeiture, and notice to quit. Under Section 116, if a lessee holds over after the lease expires and the lessor accepts rent or otherwise assents to continued possession, the lease is renewed from year to year (for agricultural or manufacturing purposes) or from month to month (for other purposes), creating a fresh implied tenancy.

Question 46EasyLease Section 105, Determination Section 111, Holding Over Section 116

According to the passage, what interest does a lessor transfer in a lease?

  1. A

    Ownership of the property for the lease period

  2. B

    An absolute right to use and sublet the property

  3. C

    Only the right to enjoy the property; the lessor retains ownership

  4. D

    A contingent interest that may or may not vest

View answer and explanation

Correct answer: C. Only the right to enjoy the property; the lessor retains ownership

The passage states: "The lessor retains ownership; only the right of enjoyment is transferred."

Source note: TPA Sections 105, 108, 111, 116

Question 47EasyLease Section 105, Determination Section 111, Holding Over Section 116

Under Section 108(b) as described in the passage, what remedy does the lessee have if the lessor neglects to make necessary repairs?

  1. A

    The lessee may terminate the lease

  2. B

    The lessee may make the repairs themselves and deduct the costs from rent

  3. C

    The lessee may sue for damages

  4. D

    The lessee must vacate and find alternative accommodation

View answer and explanation

Correct answer: B. The lessee may make the repairs themselves and deduct the costs from rent

The passage states: "Under Section 108(b), if the lessor neglects to make repairs after notice, the lessee may make the repairs and deduct costs from rent."

Source note: TPA Sections 105, 108, 111, 116

Question 48MediumLease Section 105, Determination Section 111, Holding Over Section 116

Under Section 108(e) as described in the passage, when can the lessee avoid the lease?

  1. A

    Whenever the lessee decides they no longer need the property

  2. B

    If rent is increased by more than 10 percent

  3. C

    If the lessor assigns the lessor's interest to a third party

  4. D

    If a material part of the property is wholly destroyed by fire, flood, or irresistible force, rendering it permanently unfit for the purpose for which it was let

View answer and explanation

Correct answer: D. If a material part of the property is wholly destroyed by fire, flood, or irresistible force, rendering it permanently unfit for the purpose for which it was let

The passage states: "Under Section 108(e), if a material part of the property is wholly destroyed by fire, flood, or irresistible force, rendering it permanently unfit for the purpose for which it was let, the lessee may avoid the lease."

Source note: TPA Sections 105, 108, 111, 116

Question 49EasyLease Section 105, Determination Section 111, Holding Over Section 116

According to the passage, how many modes of determination of lease does Section 111 provide?

  1. A

    Eight

  2. B

    Five

  3. C

    Six

  4. D

    Seven

View answer and explanation

Correct answer: A. Eight

The passage states Section 111 provides "eight modes of determination of a lease."

Source note: TPA Sections 105, 108, 111, 116

Question 50MediumLease Section 105, Determination Section 111, Holding Over Section 116

What happens under Section 116 when a lessee holds over and the lessor accepts rent, according to the passage?

  1. A

    The original lease is automatically renewed for the same period

  2. B

    The lessee becomes a trespasser liable for double rent

  3. C

    A fresh implied tenancy is created from year to year (for agricultural purposes) or month to month (for other purposes)

  4. D

    The lessor can evict the lessee without notice

View answer and explanation

Correct answer: C. A fresh implied tenancy is created from year to year (for agricultural purposes) or month to month (for other purposes)

The passage states: "the lease is renewed from year to year (for agricultural or manufacturing purposes) or from month to month (for other purposes), creating a fresh implied tenancy."

Source note: TPA Sections 105, 108, 111, 116

Passage or principleTPA Sections 105-116; Associated Hotels v R.N. Kapoor; Delta International; B.V. DSouza

The distinction between a lease under Section 105 of the Transfer of Property Act, 1882 and a license under the Indian Easements Act, 1882 is of fundamental importance in Indian property law. In Associated Hotels of India v. R.N. Kapoor (AIR 1959 SC 1262), the Supreme Court laid down the test: if a document gives only a right to use the property in a particular way while it remains in the possession and control of the owner, it is a licence; but if it grants a right to occupy the property conferring exclusive possession upon the grantee, the document is a lease. A lease creates an interest in property while a licence creates merely a personal right. In Delta International Ltd. v. Shyam Sunder Ganeriwalla (AIR 1999 SC 2607), the Supreme Court held that courts must look at the substance of the arrangement, not its label: a document called a "leave and license" that in substance grants exclusive possession for a definite term is a lease. Section 111 of the TPA provides eight modes of determination of a lease. Under Section 116, if a lessee holds over after the determination of the lease and the lessor accepts rent or otherwise assents to continued possession, the lease is renewed from year to year (for agricultural or manufacturing purposes) or from month to month (for other purposes), creating a fresh implied tenancy. In B.V. D'Souza v. Antonio Fausto Fernandes (AIR 1989 SC 1816), the Supreme Court held that once the lessor properly terminates the holdover tenancy by valid notice and seeks eviction, a lessee who continues in possession is a wrongful occupant liable for mesne profits at the market rate, not merely at the contracted rent.

Question 51EasyLease vs License, Determination, Holdover Section 116

According to the Associated Hotels case as described in the passage, the decisive test distinguishing a lease from a license is?

  1. A

    Whether the document creates an interest in property with exclusive possession (lease) or merely confers personal permission to use without exclusive possession (license)

  2. B

    The duration of the arrangement and the amount of rent paid

  3. C

    Whether the arrangement is in writing and registered

  4. D

    The label used by the parties in their document

View answer and explanation

Correct answer: A. Whether the document creates an interest in property with exclusive possession (lease) or merely confers personal permission to use without exclusive possession (license)

The passage states: "if it grants a right to occupy the property conferring exclusive possession upon the grantee, the document is a lease... A lease creates an interest in property while a licence creates merely a personal right."

Source note: TPA Sections 105-116; Associated Hotels v R.N. Kapoor; Delta International; B.V. DSouza

Question 52EasyLease vs License, Determination, Holdover Section 116

According to the Delta International case as described in the passage, when a document labelled "leave and license" actually grants exclusive possession for a definite term, it is treated as?

  1. A

    A valid license as the parties intended

  2. B

    Neither a lease nor a license; it is a hybrid arrangement

  3. C

    A lease, because courts look at the substance of the arrangement, not the label

  4. D

    A lease only if the document is registered

View answer and explanation

Correct answer: C. A lease, because courts look at the substance of the arrangement, not the label

The passage states: "courts must look at the substance of the arrangement, not its label: a document called a leave and license that in substance grants exclusive possession for a definite term is a lease."

Source note: TPA Sections 105-116; Associated Hotels v R.N. Kapoor; Delta International; B.V. DSouza

Question 53MediumLease vs License, Determination, Holdover Section 116

Under Section 116 TPA as described in the passage, which two conditions must be present for a holding over to create a renewed tenancy?

  1. A

    The lessee must remain in possession and the lessor must issue a fresh lease deed

  2. B

    The lessee must hold over (remain in possession after lease ends) and the lessor must accept rent or otherwise assent to continued possession

  3. C

    The lessee must remain in possession and the lessee must pay double the agreed rent

  4. D

    The lessee must hold over and must give notice of their intention to remain

View answer and explanation

Correct answer: B. The lessee must hold over (remain in possession after lease ends) and the lessor must accept rent or otherwise assent to continued possession

The passage states: "if a lessee holds over after the determination of the lease and the lessor accepts rent or otherwise assents to continued possession, the lease is renewed."

Source note: TPA Sections 105-116; Associated Hotels v R.N. Kapoor; Delta International; B.V. DSouza

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