Section 105 of the Transfer of Property Act, 1882 (TPA): Definition of Lease

Section 105 is the foundational provision within the TPA that defines a lease of immovable property. A lease is a type of transfer where one party grants the right to enjoy an immovable property to another for a specified period, in exchange for consideration.

Key Elements Defined in Section 105

The section defines the fundamental components of a lease transaction:

  • Transfer of a Right to Enjoy: A lease transfers the right of possession and use of the immovable property, but not its ownership. The owner retains the title.
  • Immovable Property: The subject matter of the lease must be immovable property.
  • Duration: The transfer must be for a certain time (express or implied), or even in perpetuity (lasting forever).
  • Consideration: The lease must be supported by consideration, which can be:
    • Premium: A price paid or promised, typically a lump-sum payment.
    • Rent: Money, a share of crops, service, or anything else of value rendered periodically or on specified occasions.

Defined Parties and Terms

Section 105 also provides the legal terminology for the parties and the consideration:

Term Definition
Lessor The transferor (owner) who grants the right to enjoy the property.
Lessee The transferee (tenant) who receives the right to enjoy the property.
Premium The price paid or promised for the lease (often a lump-sum).
Rent The consideration that is rendered periodically (e.g., monthly payments, share of crops).

This section is critical in distinguishing a lease from a license, as a lease creates an interest in the property (a right to exclusive possession for a period), while a license merely grants a personal privilege to do something on the property.