Unregistered Lease Exceeding One Year Creates Month-to-Month Tenancy Permitting Eviction Based on Clear Admissions of Occupation

The Respondent No. 1 (landlord) leased the suit property to Respondent No. 2 (Company) via an unregistered lease deed dated 13.01.2022 for the residential use of the Appellant (then Director) and his family.

The lease was for 36 months at a monthly rent exceeding ₹2.4 Lakhs.

The Appellant resigned from the Company on 23.03.2023 but continued to occupy the premises.

Following the expiry of the lease by efflux of time and repeated failures to vacate despite extensions granted on humanitarian grounds, the Respondent No. 1 issued a legal notice on 16.04.2025 terminating the tenancy.

The Respondent No. 1 filed a suit for possession and mesne profits. The Trial Court, acting on an application under Order XII Rule 6 CPC, passed a decree for possession based on admissions regarding the landlord-tenant relationship, the expiry of the lease, and the validity of the termination notice.

The Appellant challenged this decree, claiming triable issues existed regarding an alleged oral agreement for a six-year lease.

1. Whether the admissions in the Written Statement were clear, unequivocal, and unconditional so as to satisfy the requirements for a decree of possession under Order XII Rule 6 CPC.

2. Whether the Appellant could be personally liable for eviction when the lease was executed in the name of the Company.

3. Whether an unregistered lease deed or an alleged oral agreement could create a fixed-term tenancy exceeding one year.

The court applied Order XII Rule 6 of the CPC, which empowers the court to pass a judgment based on admissions of fact made in pleadings or otherwise.

It further relied on Section 107 of the Transfer of Property Act, 1882, and Section 17 of the Registration Act, 1908, which stipulate that a lease of immovable property for any term exceeding one year can be made only by a registered instrument; failing which, the tenancy is treated as month-to-month.

The court also invoked the principle that a decree for possession is executable against the person in actual physical occupation of the property, regardless of the target of the contractual obligation.

The court found that the three requisite conditions for eviction—landlord-tenant relationship, non-applicability of the Delhi Rent Control Act (due to rent exceeding ₹3,500), and valid termination of tenancy—were met.

Although the Company (Respondent No. 2) denied the lease, the court noted that the Appellant’s own admissions and the Company's Board Resolution (changing its registered office to the suit property) confirmed the tenancy.

The court rejected the Appellant’s defense of an oral agreement for a six-year term, noting that under Indian law, an unregistered lease cannot create a term exceeding one year, and negotiations for a fresh lease never materialized into a registered contract.

The Court reasoned that since the Appellant was the person in "actual physical occupation," the decree was rightly directed against him, even if the primary lessee was the Company.

The Court held that the admissions regarding the identity of the property, the landlord's ownership, and the expiry of the month-to-month tenancy were sufficient for a decree under Order XII Rule 6 CPC.

The Appellant was directed to hand over vacant and peaceful possession to the Respondent No. 1, while the suit continues regarding mesne profits and the security deposit.