Kerala High Court Rules Mere Acceptance of Rent After Notice Does Not Waive Tenancy Termination

Kochi: The High Court of Kerala has clarified that the mere acceptance of rent by a landlord after serving a quit notice to a tenant does not automatically constitute a waiver of that notice under Section 113 of the Transfer of Property Act, 1882. The court, in a judgment delivered by Justice A. Badharudeen , upheld the concurrent findings of the lower courts in an eviction suit, emphasizing that the landlord's subsequent action of filing and prosecuting an eviction suit indicates an intention contrary to treating the lease as subsisting.

The ruling came in a Regular Second Appeal (RSA 817/2019) filed by the defendant-tenant, Muhammed , challenging the eviction decree obtained by the plaintiff-landlord, Sameerali .

Background of the Case

The dispute originated from an eviction suit (O.S.No.372/2015) filed by the landlord seeking vacant possession of a building that had been rented to the defendant. The tenancy was admittedly in existence, governed by successive rent agreements. The landlord terminated the tenancy by issuing a lawyer notice on June 29, 2015. Following this notice, the tenant continued in occupation. The landlord subsequently filed the eviction suit.

The tenant, while admitting the tenancy, raised contentions typically available under rent control legislation, which are not maintainable in a general civil suit for eviction based on tenancy termination under the Transfer of Property Act. The trial court decreed the suit, directing eviction and granting occupation charges (mesne profits) of Rs. 3,000 per month. This decision was affirmed by the first appellate court (Sub Court, Manjeri).

Arguments Presented

Before the High Court, the core argument raised by the tenant centered on the landlord's acceptance of rent after the quit notice was issued. The tenant contended that this act, coupled with the landlord's evidence during cross-examination acknowledging the tenant's continued occupation, amounted to a waiver of the quit notice under Section 113 of the Transfer of Property Act. Therefore, the tenant argued, a fresh quit notice was necessary to initiate eviction proceedings successfully.

The landlord, represented by counsel, countered this by submitting that the acceptance of rent after the notice was merely for the continued use and occupation of the premises by the tenant until eviction. It was argued that the landlord's intention was clearly not to waive the notice or treat the lease as subsisting, as evidenced by the very act of filing and prosecuting the suit for eviction.

Court's Analysis and Precedents

Justice A. Badharudeen examined Section 113 of the Transfer of Property Act, which deals with the waiver of a notice to quit. The section stipulates that a notice is waived with the express or implied consent of the recipient by any act of the person giving the notice showing an intention to treat the lease as subsisting.

The court placed reliance on a key decision of the Supreme Court in Sarup Singh Gupta v. S.Jagdish Singh & Ors. (AIR 2006 SC 1734) . The Supreme Court in that case held that "mere acceptance of rent did not by itself constitute an act of the nature envisaged by Section 113, Transfer of Property Act showing an intention to treat the lease as subsisting." The Apex Court noted that landlords are entitled to arrears of rent or compensation for use and occupation even after termination, and receiving such payments while prosecuting an eviction suit does not suggest an intent to waive the notice.

The High Court also referred to Ganga Dutt Murarka v. Kartik Chandra Das & Ors. (AIR 1961 SC 1067) , where the Supreme Court held that payment and acceptance of rent after termination do not create a 'tenancy by holding over' under Section 116 of the T.P. Act. Further, the judgment cited Calcutta Credit Corporation Ltd. & anr. v. Happy Homes (P) Ltd. ((1968) 2 SCR 20) , which established that if there is a waiver under Section 113, it creates a new tenancy, but importantly, after the issuance of a quit notice, the tenant's status is that of a 'tenant at sufferance', essentially a trespasser.

The Court's Decision

Applying these principles, the High Court held that the substantial question of law – whether mere receipt of rent after the quit notice amounts to waiver – must be answered in the negative. The court concluded that the acceptance of rent by the landlord in this case, while simultaneously pursuing the eviction suit, did not demonstrate an intention to waive the validly issued quit notice under Section 113 of the Transfer of Property Act.

The judgment stated, "mere receipt of rent by the landlord, after receipt of quit notice by the tenant, would not tantamount to waiver of the quit notice, contemplated under Section 113 of the T.P Act." The court affirmed that following the termination of tenancy by notice, the status of the defendant was merely that of a 'tenant at sufferance', who is bound to vacate the building.

Conclusion

Finding no ground to interfere with the consistent verdicts of the trial court and the first appellate court, the High Court dismissed the appeal. The decree for eviction and the direction to pay occupation charges until the date of surrender were thereby confirmed.

The ruling reinforces the legal position that in eviction suits based on tenancy termination under the Transfer of Property Act, the landlord's right to recover compensation for the tenant's continued occupation after notice does not negate the effect of the notice itself, provided the landlord's intent to terminate the tenancy is clear, such as by filing and prosecuting an eviction suit.