Section 107 of Transfer of Property Act, 1882

Source: Kerala High Court

Why in News?

Recently, the Kerala High Court in the matter of Sheela v. Abdul Gafoor has held that a lease deed for less than 12 months cannot be rejected for want of registration under Section 107 of the Transfer of Property Act, 1882 (TPA).

What was the Background of Sheela v. Abdul Gafoor Case?

• In this case, the respondent (landlord) had sought an eviction against the petitioner on the grounds of arrears of rent.
• The petitioner (tenant) had submitted a preliminary objection denying the title of the respondent over the property in dispute which was dismissed by the Rent Control Appellate Authority.
• The rental arrangement between the petitioner and the respondent is said to have been renewed on 05^th January 2022 for a period of 11 months on the basis of a lease deed executed on that day.
• The petitioner submitted that the document was not executed with an intention to create a lease.
• Aggrieved by the refusal of the Rent Control Appellate Authority, to accept the challenge of denial of title raised by the petitioner filed a petition before the High Court of Kerala which was later rejected by the Court.

What were the Court’s Observations?

• A bench of Justices Anil K. Narendran and G. Girish observed that a lease deed for less than 12 months cannot be rejected for want of registration under Section 107 of TPA.
• It was further held that a mere reading of Section 107 of TPA, will make it clear that the requirement of compulsory registration of lease deed is applicable only in respect of a lease from year to year or for any term exceeding one year, or reserving a yearly rent.

What is Section 107 of TPA?

• This Section deals with the making of a lease.
• It states that a lease of immoveable property from year to year, or for any term exceeding one year, or reserving a yearly rent, can be made only by a registered instrument.
• All other leases of immoveable property may be made either by a registered instrument or by oral agreement accompanied by delivery of possession.
• Where a lease of immoveable property is made by a registered instrument, such instrument or, where there are more instruments than one, each such instrument shall be executed by both the lessor and the lessee.
• Provided that the State Government may, from time to time, by notification in the Official Gazette, direct that leases of immoveable property, other than leases from year to year, or for any term exceeding one year, or reserving a yearly rent, or any class of such leases, may be made by unregistered instrument or by oral agreement without delivery of possession.