Section 105 of Transfer of Property Act, 1882 - Lease Defined

Section 105 of the Transfer of Property Act, 1882 defines a lease of immovable property and identifies the legal meaning of lessor, lessee, premium and rent. The provision is part of Chapter V, dealing with leases of immovable property.

Section 105 - Lease defined (statutory text)

105. A lease of immoveable 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. The transferor is called the lessor, the transferee is called the lessee, the price is called the premium, and the money, share, service or other thing to be so rendered is called the rent.

Meaning and essential features of a lease

A lease transfers the right to enjoy immovable property, rather than ownership of the property itself. It requires identifiable immovable property, a lessor and a lessee, acceptance of the transfer on its terms, a duration that may be express, implied or perpetual, and consideration as contemplated by the section.

Definitions under Section 105

Lessor: The transferor who grants the right to enjoy the property.
Lessee: The transferee who accepts the lease on the agreed terms.
Premium: The price paid or promised as consideration for the transfer of the leasehold right.
Rent: Money, a share of crops, services or another thing of value rendered periodically or on specified occasions.

Practical illustrations

If an owner allows a tenant to occupy a shop for three years in exchange for monthly payments, the owner is the lessor, the tenant is the lessee and the monthly payments are rent. If the lessee also pays an agreed one-time price for acquiring the lease, that price may constitute premium. The actual legal character of a transaction depends on its substance and terms, not merely the label used by the parties.

Section 106: Supplies default rules for the duration and termination of certain leases where no contrary contract, local law or usage applies. Ordinarily, the prescribed notice is six months for agricultural or manufacturing purposes and fifteen days for other purposes, subject to the section and applicable law.

Section 107: Governs how leases are made. A lease from year to year, for a term exceeding one year, or reserving yearly rent requires a registered instrument. Other leases may be made as specified in that section, subject to applicable law.

Section 108: Sets out default rights and liabilities of lessors and lessees, subject to contract and local usage as provided there.

Section 111: Addresses determination of leases, including expiry, surrender, forfeiture and other specified circumstances.

Section 117: Provides an important qualification concerning leases for agricultural purposes and the applicability of Chapter V, subject to government notifications and local law. State-specific rent-control, tenancy, registration and stamp laws may also affect a particular transaction.

Official legal resources

Consult the Transfer of Property Act, 1882 on India Code and the Transfer of Property Act text published by the Delhi District Courts. Verify relevant state amendments, notifications and local tenancy rules before applying these provisions to a specific property.

Frequently asked questions

Does a lease transfer ownership?

No. Section 105 concerns transfer of the right to enjoy immovable property, not transfer of the lessor's ownership.

Can rent be paid in something other than money?

Yes. Section 105 expressly includes a share of crops, services and other things of value.

Must every lease be registered?

No. Registration depends on the nature and duration of the lease, Section 107, the Registration Act, applicable state laws and any relevant notifications.