What is basic concept of implied surrender of tenancy?

37. The doctrine of implied surrender is a legal principle evolved for purpose of recognising a state of facts or a transaction relating to which there is no express document. Such an implied surrender in law is presumed where the new state of facts are inconsistent and incompatible with the continuation or existence of a former relationship. If the new facts and relationship found is inconsistent and incompatible and if the two cannot stated together viz. the new relationship found and the former relationship which existed then the law presumes that thee was an implied surrender by the holder of the former status of his rights in the property in question. Such an implied surrender is presumed where a new relationship which is incompatible and inconsistent is created by a simple relinquishment of possession.

 Mulla in his Transfer of Property Act, 6th Edition, Page 745 observed :---

"There must be a taking of possession, not necessarily a physical taking, but something amounting to a virtual taking of possession."

If, therefore, an inference that possession must have been taken and parted with is possible and if the conduct of the parties is inconsistent with such an hypothesis, then in such circumstances it will have to be held that possession of the kind which it was possible was parted with and delivered. Even a notional parting of possession would become surrender of possession. For rendering validity to a surrender, physical delivery of possession is not an absolute must, if a person is notionally in possession. If a person hands over possession of the kind which he can deliver and of which he was possessed, which he had then in law, even such parting of possession or character would clothe the transaction with an implied surrender.

46. In Shah Mathurdas Maganlal and Co. v. Nagappa Shankarappa Malaga and others, A.I.R. S C 1565 , a mortgage was executed in favour of the tenant and the question arose as to whether there was a merger and upon redemption whether the right of the tenant as tenant revived. It was held that :---

"Implied surrender by operation of law occurs by the creation of a new relationship, or by relinquishment of possession. If the lessee accepts a new lease that in itself is a surrender. Surrender can also be implied from the consent of the parties or from such facts as the relinquishment of possession by the lessee and taking over possession by the lessor."

47. On behalf of the landlord, the learned Counsel Shri Abhyankar placed reliance upon a decision reported in Noratmal v. Mohanlal A.I.R. 1966 Raj 89 wherein it was observed that :---

"It may be a surrender by acceptance of a new lease or a surrender by unequivocal giving of possession or a surrender by re-letting to another person by the landlord. Even acceptance by the landlord of the sub-lessee as his tenant would amount to surrender."

It is, therefore, clear that where there was re-letting to another person by the landlord, there would be implied surrender. As I have pointed out the basis for the application of this legal doctrine is incompatibility and impossibility of existence of two inconsistent situations together. In such an event, law holds that the first has impliedly surrendered his interest and rights in the property when rights were created in favour of another person.

IN THE HIGH COURT OF BOMBAY

Writ Petition Nos. 1448 and 2744 of 1978

Decided On: 04.03.1983

 Sugrabi  Vs.  Cavas Navroji Patel and Ors.

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Whether lease can be surrendered unilaterally?

A surrender under clauses (e) and (f) of section 111 of the Transfer of Property Act, is an yielding up of the term of the lessee's interest to him who has the immediate reversion or the lessor's interest. It takes effect like a contract by mutual consent on the lessor's acceptance of the act of the lessee. The lessee cannot, therefore, surrender unless the term is vested in him; and the surrender must be to a person in whom the immediate reversion expectant on the term is vested. Implied surrender by operation of law occurs by the creation of a new relationship, or by relinquishment of possession. It the lessee accepts a new lease that in itself is a surrender. Surrender can also be implied from the consent of the parties or from such facts as the relinquishment of possession by the lessee and taking over possession by the lessor. Relinquishment of possession operates as an implied surrender. There must be a taking of possession, not necessarily a physical taking, but something amounting to a virtual taking of possession. Whether this has occurred is a question of fact.

Supreme Court of India

Shah Mathuradas Maganlal & Co vs Nagappa Shankarappa Malage & Ors on 23 March, 1976

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When there is implied surrender of tenancy by tenant?

In the judgment of Tarachand V/s. Sagarbai Alias Chaiyalibai (supra) it is categorically held by the Hon'ble Apex Court that, if the tenant surrenders the tenancy, either explicitly or by necessary implication, the terms of mortgage shall prevail. It was held that the question whether rights of tenant would give way to rights of mortgagor would essentially depend upon the terms and conditions of the mortgage. As per the Hon'ble Apex Court, the facts that would separate the inference of surrender of tenancy are the fixed term for redemption of mortgaged property, the liability of tenant to pay rent not kept alive, right conferred on the mortgagee to get the property auctioned in the event of non-repayment of mortgage amount, etc.

20. In the facts of the present case, admittedly, there is no mention of the alleged tenancy in the mortgage deed. Moreover, the mortgage deed was admittedly for a fixed term of five years. The liability to pay rent was not kept alive and the right was given to consider it as a sale-deed, if the Respondent was unable to redeem the mortgage within stipulated period of 5 years. Therefore, the terms and conditions of the mortgage deed clearly spell out the implied surrender of the tenancy. Hence, as held in this judgment of Tarachand V/s. Sagarbai Alias Chaiyalibai (supra), assuming that the Appellant was in possession of the suit premises as a tenant, in view of the implied surrender of tenancy on execution of the mortgage deed, on redemption of mortgage the Respondent becomes entitled to get possession of the suit property. The Respondent-landlord was therefore not required to proceed against the Appellant under the provisions of Rent Control statute to recover the possession. Therefore, having surrendered his tenancy may be impliedly, the Appellant cannot retain his possession. Hence, on this ground also, the judgment and decree passed by the trial Court and confirmed by the Appellate Court does not call for any interference.

IN THE HIGH COURT OF BOMBAY

Second Appeal No. 265 of 1991 and Civil Application No. 1225 of 2017

Decided On: 27.06.2018

 Nivruti Dnyanu Patil Vs. Shankar Krishna Bhagat-Patil and Ors.

Hon'ble Judges/Coram:

Dr. Shalini Phansalkar Joshi, J.

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Whether there can be implied surrender of tenancy by conduct?

On a consideration of the evidence, the High Court concurring with the findings of fact on the point recorded by the Rent Controller and the Tribunal, held that after the death of Chaman Lal it was Sushil Kumar alone who continued in occupation of and was carrying on the business in the premises and that in the circumstances of the case the other heirs must be held to have surrendered their rights of tenancy. This implied surrender was inferred from the evidence as to the conduct of the other heirs. 

IN THE SUPREME COURT OF INDIA

Civil Appeal No. 5012 of 1989 and No. .. of 1993 (Arising out of SLP (C) No. 4105 of 1989)

Decided On: 07.09.1993

 Pushpa Rani and Ors. Vs.  Bhagwanti Devi and Anr.

Hon'ble Judges/Coram:

M.N. Venkatachaliah, C.J. and Dr. A.S. Anand, J.

Citation: AIR 1994 SC 774,1994(2) RCR298.

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