A lease agreement under the Transfer of Property Act, 1882 (TPA) governs the relationship between the lessor (the owner of the property) and the lessee (the tenant or person renting the property). It is a contract in which the lessor transfers the right to enjoy the property to the lessee for a certain period in exchange for rent. The TPA, particularly Sections 105 to 117, covers the rights and liabilities of both parties involved in a lease agreement.

Rights of the Lessor (Landlord)

The lessor, as the owner of the property, enjoys several rights under the lease agreement, some of which include:

• Right to Receive Rent (Section 108): The lessor has the right to receive the agreed-upon rent from the lessee at the specified intervals. Rent is the consideration for granting the lease, and the lessor is entitled to timely payment as per the lease terms.
• Right to Re-enter in Case of Default (Section 111): If the lessee breaches the terms of the lease, such as failing to pay rent or using the property for illegal purposes, the lessor has the right to re-enter the property. The lessor can terminate the lease and reclaim possession of the property if the lessee defaults in their obligations.
• Right to Insist on Compliance with Lease Terms (Section 108): The lessor can require the lessee to adhere to the terms of the lease, including paying rent on time, maintaining the property in good condition, and adhering to any other contractual obligations.
• Right to Eviction: If the lessee violates the terms of the lease, such as subletting without permission or causing significant damage to the property, the lessor has the right to evict the lessee after due notice and legal process.
• Right to Take Action for Breach of Contract: The lessor has the right to sue the lessee for breach of contract if the lessee does not perform their obligations, such as failure to maintain the property or make necessary repairs.
• Right to Appropriation of Rent in Certain Circumstances (Section 111): In the case of a sub-lease or assignment, the lessor has the right to collect rent from the sub-tenant if the lessee has failed to meet their obligations.

Liabilities of the Lessor

• Duty to Provide Possession (Section 108): The lessor must deliver possession of the property to the lessee at the start of the lease term, ensuring that the lessee can peacefully enjoy the property.
• Duty to Maintain the Property (Section 108): The lessor is generally responsible for ensuring that the property is fit for use and meets basic health and safety standards. The lessor must also carry out structural repairs, as opposed to the lessee who is responsible for routine maintenance and minor repairs.
• Duty to Ensure Quiet Enjoyment (Section 108): The lessor has an obligation to ensure that the lessee has quiet enjoyment of the property, which means that no one, including the lessor, can disturb the lessee's possession or use of the property during the lease period, except in cases of necessary repairs or legal proceedings.
• Duty to Disclose Title (Section 108): The lessor must disclose to the lessee if there are any existing legal encumbrances or claims on the property that could affect the lessee's ability to enjoy the property during the lease period.
• Liability for Breach of Lease Terms: If the lessor fails to fulfill their duties, such as failing to make essential repairs or violating the lessee's right to quiet enjoyment, the lessor may be liable to the lessee for damages resulting from the breach of contract.

Rights of the Lessee

• Right to Enjoy the Property (Section 108): The lessee has the right to peacefully enjoy the property for the duration of the lease without interference from the lessor, except in cases where the lessor is exercising their right to enter for repairs or maintenance.
• Right to Transfer or Sublet (Section 108): Unless prohibited by the lease agreement, the lessee has the right to sublet or transfer the leasehold interest in the property to another person. This is subject to the terms set out in the lease agreement.
• Right to Claim Compensation for Eviction (Section 111): If the lessor evicts the lessee unlawfully or without sufficient notice, the lessee has the right to seek compensation or damages for wrongful eviction.
• Right to Be Protected Against Harassment or Interference: The lessee is entitled to protection from any harassment or unlawful interference from the lessor during the lease term. The lessor cannot enter the property or disrupt the lessee's use of it without proper notice or justification.
• Right to Deduct Cost of Repairs (Section 108): If the lessor fails to maintain the property and the lessee is forced to carry out repairs or maintenance, the lessee has the right to deduct the cost of such repairs from the rent owed to the lessor, provided the repairs were essential for the property's habitability.

Liabilities of the Lessee

• Duty to Pay Rent (Section 108): The lessee is legally obligated to pay rent as per the agreed-upon schedule. Failure to pay rent can result in the lessor terminating the lease or initiating legal action for arrears.
• Duty to Maintain the Property (Section 108): The lessee must maintain the property during the lease period and return it in good condition, subject to reasonable wear and tear. The lessee must repair any damage caused to the property (except for normal wear and tear).
• Duty to Avoid Waste (Section 108): The lessee must not commit waste or damage the property beyond normal wear and tear, as this could reduce its value or utility.
• Duty to Return Possession at the End of Lease (Section 108): The lessee is obligated to vacate and return possession of the property to the lessor at the end of the lease term or when the lease is terminated. If the lessee does not vacate the property or has not followed the required process, the lessor has the right to initiate eviction proceedings.
• Liability for Subletting (Section 108): If the lessee sublets the property or transfers the lease in violation of the lease agreement, they may be liable for breach of contract. The lessor can seek legal remedies, including termination of the lease.

The rights and liabilities of the lessor and lessee in a lease agreement under the Transfer of Property Act, 1882 ensure a balanced and mutually beneficial relationship. The lessor's primary rights include receiving rent, maintaining control over the property, and ensuring compliance with the lease terms. On the other hand, the lessee's rights focus on peaceful enjoyment, protection against unlawful eviction, and the ability to make repairs if necessary.

Both parties have corresponding liabilities, such as the lessor's duty to maintain the property and the lessee's obligation to pay rent and maintain the property in good condition. Understanding these rights and duties is essential for both lessors and lessees to ensure the smooth operation of the lease agreement.

Written By: Prithwish Ganguli, Advocate - LLM (CU), MA in Sociology (SRU), MA in Criminology & Forensic Sc (NALSAR), Dip in Psychology (ALISON), Dip in Cyber Law (ASCL), Dip in International Convention & Maritime Law (ALISON), Faculty, Heritage Law College, Kolkata