Notice to Quit (Section 106)

Section 106 of the Transfer of Property Act, 1882 answers two practical questions about every periodic tenancy: how long does it run, and how is it brought to an end? The section supplies the rule of construction when the parties are silent on duration, and prescribes the length, form, and mode of service of the notice to quit that closes the tenancy. After the Transfer of Property (Amendment) Act 3 of 2003, the section was rewritten to soften a technical trap that had defeated landlords for decades. The leases of land for agricultural or manufacturing purposes are deemed to run from year to year, terminable on six months' notice; every other lease silent on duration is deemed to run from month to month, terminable on fifteen days' notice. The notice must be in writing, signed, and served in one of four prescribed ways. The section is a pendant to Section 105 (which defines the lease) and Section 111(h) (which makes the expiry of the notice one of the eight modes by which a lease comes to an end).

The statutory text

Section 106 was substituted in its entirety by Act 3 of 2003 (with effect from 31 December 2002). It now reads in four sub-sections.

The 2002 amendment and its mischief

Before the substitution by Act 3 of 2003, the original section required the notice to expire with the end of the year or month of the tenancy. The Supreme Court in Mangilal v Sugan Chand Ratki AIR 1965 SC 101 had cemented the rule that the day on which the notice was served was to be excluded while computing the fifteen-day period. Hundreds of suits were dismissed because landlords or their counsel had reckoned the date of expiry one day short, or because the notice closed mid-month. The Law Commission of India in its 181st Report identified this as the central source of multiplicity of litigation in landlord-tenant disputes and recommended a saving clause. Sub-section (3) is its statutory expression: the notice is no longer to be defeated by a shortfall in the period mentioned in it, provided the suit or proceeding is filed after the period specified by sub-section (1) has in fact expired. Sub-section (2) reverses the older common-law presumption about the date of dispatch and now fixes the period as commencing from the date of receipt by the addressee. The amendment applies to all notices in pursuance of which a suit or proceeding was pending at the commencement of the amending Act, and to all notices already issued where no suit had yet been filed; the technical pleas formerly available under the unamended section can no longer be raised at any stage.

The two presumptions of duration

Section 106 raises two deeming presumptions and applies only when the parties have not specifically agreed upon duration. The first presumption is that a lease for an agricultural or manufacturing purpose is a lease from year to year, terminable by six months' notice. The second presumption is residuary: a lease for any other purpose is from month to month, terminable by fifteen days' notice. Both presumptions are subject to a contract, local law, or usage to the contrary. Where the parties by their contract have indicated the duration of the lease, the section does not apply: Nabina Chadha v Usha Das AIR 2011 Ori 5; Padma Nath & Sons v Yash Pal 2021 SCC OnLine SC 1095. The existence of a valid lease is a precondition to the operation of the rule of construction: Samir Mukherjee v Davinder K Bajaj (2001) 5 SCC 259. There can be no lease for a fixed term exceeding one year by oral or unregistered instrument, and in those cases the deeming clause supplies the duration. The Supreme Court in Anthony v K C Ittoop (2000) 6 SCC 394 held that an unregistered instrument required to be compulsorily registered cannot create a lease, but the conduct of the parties may yet establish a periodic lease falling within the second part of Section 107.

Manufacturing purpose — the test

Whether a lease is for a manufacturing purpose is a question of fact on which six months versus fifteen days turns. In Idandas v Anant Ramchandra Phadke AIR 1982 SC 127, the Supreme Court reviewed the conflict and laid down a three-fold test: an article must be produced; the process of production must involve labour or machinery; and the end product must have a different name and use, the original raw material having lost its character. Running a flour mill, baking, brick-making, and steel-trunk manufacture all qualify. Sawing logs into smaller pieces, retreading tyres, fodder cutting, and the preparation of sweets do not. The onus to prove the manufacturing character of the lease is on the lessee. The dominant purpose at the time of the original letting governs, not subsequent change of user. A lease partly for residence and partly for stacking timber is treated as a commercial lease and only fifteen days' notice will suffice.

Contract to the contrary

The presumption may be displaced by a contract, by local law, or by usage. A clause in a rent note providing that the lessee shall surrender the premises on demand makes the tenancy determinable at will and dispenses with the section 106 notice. A clause for monthly rent in a manufacturing lease has been treated as a contract to the contrary, displacing the year-to-year presumption: Abdulahed Moulvi v Gulamahmed Gulamnabi Bardoliwala AIR 1975 Guj 1. A condition that the lease shall be vacated whenever required by the landlord without notice is good only if it is part of the bilateral bargain and not a superadded condition. An undertaking by the tenant to vacate by a fixed date has been held to be a contract to the contrary that disentitles him to a section 106 notice. A tenancy for a fixed term, on the other hand, ends by efflux of time under Section 111(a) and no notice to quit is needed: Shanti Devi v Amal Kumar Banerjee AIR 1981 SC 1550. The lessee in such a case becomes a tenant at sufferance whose possession can be recovered without notice.

Form and content of the notice

The notice must be in writing and must be signed by the person giving it or on his behalf. The Supreme Court has consistently directed that the notice should not be construed pedantically. The leading authority is Bhagabandas Agarwalla v Bhagwandas Kanu (1977) 2 SCC 646, where the Court resurrected the maxim ut res magis valeat quam pereat — "that an act may avail rather than perish" — and held that the notice should not be defeated by inaccuracies if the recipient cannot have been misled. The principle was originally stated by Lord Justice Lindley in Sidebotham v Holland [1895] 1 QB 378 — the validity of a notice to quit "ought not to turn on the splitting of a straw" — and was carried into Indian law by the Privy Council in Harihar Banerji v Ramsashi Roy 45 IA 222. The notice must clearly and unambiguously communicate the lessor's intention to determine the tenancy. It need not state any reason for termination. A wrong description of the boundary, an inaccurate area figure, an erroneous mention of section 102 instead of section 106, or a misdescription of the tenant's name will not invalidate the notice if the recipient understood its tenor. The construction must, however, never deprive the tenant of the minimum statutory period of fifteen days: Mangilal v Sugan Chand (supra). A notice that asks the tenant to vacate a fraction of the demised premises is bad, for tenancy cannot be split unilaterally by either party.

Length and computation of the period

The fifteen-day period in monthly tenancies and the six-month period in yearly tenancies are minima. After the 2002 amendment, sub-section (2) makes the period run from the date of receipt of the notice. Sub-section (3) supplies the saving clause: even if the notice itself mentions a shorter period, the notice is not invalid provided the suit is filed after the statutory period has expired. The Calcutta High Court in Kanak Pramanik v Indrajit Bandyopadhyay AIR 2013 Cal 60 has read sub-section (3) liberally; if a defective notice is followed by a suit filed after the lapse of fifteen days, the defect is cured. The English calendar month governs unless the parties have adopted a Bengali or other local calendar by long course of dealing: Mritunjoy Sett v Jadunath Basak (2011) 11 SCC 402.

Mode of service — sub-section (4)

Sub-section (4) prescribes four alternative modes of service. The notice may be sent by post to the addressee; or tendered or delivered personally to him; or, where personal tender or delivery is not practicable, to one of his family or servants at his residence; or, in default, affixed to a conspicuous part of the property. Service by registered post raises the presumption under section 27 of the General Clauses Act, 1897 — a presumption that is rebuttable. Where the registered cover returns with the endorsement "refused" and the addressee denies refusal, the burden lies on the landlord to prove that the postal peon actually offered delivery. Where it returns "not claimed" and the address is otherwise correct, deemed service is established. Affixation is a mode of last resort and must be preceded by a failure of the other modes; an affidavit of the process-server affixing the notice is good evidence of service. In a joint tenancy notice to one of several joint tenants is sufficient as against the others, but the notice must be addressed to all in order to make all of them parties to the eviction suit.

Notice and the rent control statutes — Dhanapal Chettiar

The most consequential decision on the relationship between section 106 and the various State rent control enactments is the Constitution Bench ruling in V Dhanapal Chettiar v Yesodai Ammal AIR 1979 SC 1745. Overruling a clutch of earlier decisions, a seven-Judge Bench held that to obtain a decree for eviction against a tenant under a State rent control Act, it is not necessary to give a notice under section 106. The contractual tenancy can continue or stand determined; either way the landlord cannot eject the tenant except by making out a ground specified in the rent control statute. Determining the tenancy by a section 106 notice is therefore a mere surplusage; it adds nothing to the landlord's case under the special statute. The decision freed the landlord from a trap that had cost many an eviction suit but left the tenant's protections under the rent Act untouched. The reasoning has since been applied across the country: Surinder Kumar v Mahant Gomati Das AIR 2017 (NOC) 787 (P&H); Rupa Ghosh v Satyanarayan Dudhani AIR 2018 Jhar 147. Dhanapal Chettiar does not, however, abolish section 106 in cases governed by the TPA alone, nor does it apply where the rent control statute by its own terms makes a quit notice a precondition.

Notice and the validity of the suit

The Supreme Court has held in Sevoke Properties Ltd v WB State Electricity Distribution Co Ltd (2020) 11 SCC 782 that the notice is not part of the cause of action; it is a step in litigation that is a condition precedent to the suit but does not constitute the relief itself. The substantive purpose of the notice — intimation of termination and a fifteen-day period to vacate — is fulfilled by the institution of the eviction suit itself, so long as eviction is actually sought beyond the fifteen-day window. A defective notice followed by a suit instituted after the period has expired is therefore good. Aftab Singh v Vanasthali Public School (2007) 11 SCC 619 reiterates the proposition. The Calcutta High Court has held in Krishna Sudam Roy v Debasish Bhowmik 2021 AIR CC 2295 that mention of a wrong section in the notice does not vitiate it. Procedurally, the suit is governed by the ordinary law of pleadings under the Code of Civil Procedure, and an Order XII Rule 6 admission of jural relationship plus termination is enough for a decree. A second notice to quit served after a first one has expired operates as a waiver of the first, on the principle in illustration (b) to Section 113; the leading SC authority on waiver of notice to quit is Calcutta Credit Corporation v Happy Homes AIR 1968 SC 471.

Periodic tenancies and tenancy at sufferance

The notice to quit applies only to a subsisting periodic tenancy. A tenant who continues in possession after the term has expired by efflux of time is a tenant at sufferance, not a tenant at will, and his possession can be recovered without notice. A tenant holding over under Section 116 of the Act, by contrast, becomes a fresh monthly tenant whose tenancy must be determined by a section 106 notice. The Supreme Court drew this critical distinction in Burmah Shell Oil Storage and Distributing Co v Khaja Midhat Noor AIR 1988 SC 1470 and reiterated it in Nopany Investments (P) Ltd v Santokh Singh (2008) 2 SCC 728. A tenant who denies the landlord's title before suit forfeits his lease under Section 111(g) and a notice to quit is not necessary; but the disclaimer must be before the institution of the suit, not in the written statement.

Joint tenants, co-owners, and notice by an agent

A notice given by one of several co-owner landlords binds all the others, provided he is authorised. A suit for eviction can be instituted by a single co-owner competent to transfer his undivided interest: Sk Sattar Sk Mohd Choudhari v Gundappa Patil (1996) 6 SCC 373. After the determination of the tenancy by all the co-owners, however, no single co-owner can waive the notice or revive the tenancy. Notice by counsel signed under authority is good; the Delhi High Court in Roxy Enterprises Pvt Ltd v Aruna Anand AIR 1994 Del 256 (NOC) treated non-signing of an endorsement as a curable irregularity since the notice itself bore counsel's signature. Where the lessor is a corporate body, the notice must be signed by an officer authorised by the articles or by a board resolution.

Acceptance of rent after notice

Mere acceptance of rent after the notice has expired does not necessarily waive the notice. Section 113 requires that the act of acceptance show an intention to treat the lease as subsisting. Acceptance under protest, or for damages for use and occupation, does not amount to waiver: Kedar Lal Seal v Hari Lal Seal AIR 1952 SC 47. Where, however, the landlord accepts rent and gives the tenant a fresh receipt without protest, an inference of waiver may be drawn. The Supreme Court in Sardarilal v Preetam Singh AIR 1978 SC 1518 held that something more than mere payment and acceptance of rent is needed to assert that the lessor has assented to the lessee continuing in possession. The rule is two-sided: there must be an offer by the lessee evidenced by his continuing in possession, and an unequivocal assent by the lessor evidenced by acceptance of rent, before Section 116 creates a fresh tenancy.

Effect of an invalid notice

If the notice is invalid in form or service and the saving in sub-section (3) does not cure it, the periodic tenancy continues. The lessor cannot recover possession until a fresh and valid notice has been served and has expired. An invalid notice does not, however, prejudice the lessor's right to issue a fresh notice; nor does it create any estoppel against him. If the tenant in his written statement denies the landlord's title, the lessor may amend his plaint to add a plea of forfeiture under section 111(g) without serving a fresh notice. Conversely, the Supreme Court has cautioned that a quit notice, once issued, cannot be withdrawn unilaterally if it has been acted on. In P Ratnam v Vimalchandra AIR 1973 Bom 111 the landlord was permitted to withdraw a notice when the tenant resisted the suit on the ground of its invalidity — a procedural concession that does not survive an effective termination.

Practical points for the exam-aspirant

Section 106 is examined more often than perhaps any other provision of the lease chapter, and the questions almost always turn on a few recurring issues. The first is the distinction between a lease ending by efflux of time, where no notice is needed, and a periodic tenancy, where it is. The second is the test of manufacturing purpose under Idandas. The third is the saving clause in sub-section (3) and the date-of-receipt rule in sub-section (2) introduced by the 2002 amendment. The fourth is the Dhanapal Chettiar doctrine that a quit notice is unnecessary in a suit founded on State rent control law. The fifth is the contrast between waiver of notice to quit (a bilateral act under section 113) and waiver of forfeiture (unilateral, governed by Section 112). The sixth is the four modes of service in sub-section (4) and the presumption of service by registered post under section 27 of the General Clauses Act. Each is liable to be reframed as a single-line MCQ; each has at least one Supreme Court authority that must be remembered by name. The cluster of cases — Bhagabandas Agarwalla, Calcutta Credit Corporation, Dhanapal Chettiar, Burmah Shell, Aftab Singh, Nopany Investments, Mangilal, Sevoke Properties, Mritunjoy Sett, Idandas, Samir Mukherjee — gives the candidate the case-law spine of the chapter.

Frequently asked questions

Is a notice under Section 106 necessary if the lease has expired by efflux of time?

No. A lease for a fixed term ends automatically on the last day of the term under Section 111(a) TPA. The lessee thereafter is a tenant at sufferance, not a periodic tenant, and possession can be recovered without notice. The Supreme Court in Shanti Devi v Amal Kumar Banerjee AIR 1981 SC 1550 and again in Sevoke Properties Ltd v WB State Electricity Distribution Co Ltd (2020) 11 SCC 782 has confirmed this. Section 106 applies only when the tenancy is a subsisting periodic tenancy or one created by holding over under Section 116.

What did the 2002 amendment to Section 106 change?

Act 3 of 2003 substituted Section 106 with effect from 31 December 2002. Three substantive changes followed. Sub-section (2) provides that the notice period runs from the date of receipt by the addressee, not the date of dispatch. Sub-section (3) introduces a saving clause: a notice is not invalid merely because the period it mentions falls short of the statutory minimum, provided the suit is filed after the statutory period has actually expired. The amendment also dropped the older requirement that the notice expire with the end of the year or month of the tenancy. Sub-section (4) restated the four modes of service in plain terms.

Is a Section 106 notice necessary in a suit under a State rent control Act?

No. The seven-Judge Constitution Bench in V Dhanapal Chettiar v Yesodai Ammal AIR 1979 SC 1745 held that determining the contractual tenancy by a Section 106 notice is a mere surplusage when eviction is sought under a State rent control statute. The landlord cannot evict the tenant even after determination unless the rent control grounds are made out, and conversely once those grounds are made out he can evict without first determining the tenancy. The decision overruled a long line of earlier authority and is the most cited proposition on Section 106.

Can a notice to quit be defeated by inaccuracies in the description of the premises or the date of expiry?

Generally no. The Supreme Court in Bhagabandas Agarwalla v Bhagwandas Kanu (1977) 2 SCC 646 directed that a notice should be construed ut res magis valeat quam pereat — "that an act may avail rather than perish". A notice is not invalid for minor errors in boundary description, name of the tenant, area figure, or even the section under which it purports to be issued, as long as the recipient could not have been misled. The construction cannot, however, deprive the tenant of the statutory minimum of fifteen days: Mangilal v Sugan Chand Ratki AIR 1965 SC 101.

How is service by registered post proved when the cover returns 'refused' and the tenant denies receipt?

Section 27 of the General Clauses Act, 1897 raises a presumption of due service when the notice is sent by registered post to the correct address. The presumption is rebuttable. Where the cover returns marked 'refused' and the tenant pleads that he did not refuse, the burden shifts back to the landlord to prove that the postal peon actually offered delivery. The Andhra Pradesh High Court in K Sajjan Raj v Punjab Gopisetty Chandra Mowli AIR 2011 (NOC) 411 held that in such cases the postal peon must be examined. If the cover returns 'not claimed' and the address is correct, deemed service is established.

Can a tenant rely on holding over under Section 116 to insist on a fresh Section 106 notice?

Yes, but only if the lessor has assented to his continuance in possession by accepting rent or some equivalent positive act. The Supreme Court in Burmah Shell v Khaja Midhat Noor AIR 1988 SC 1470 and Nopany Investments v Santokh Singh (2008) 2 SCC 728 stressed that mere continuance is not enough — there must be a bilateral agreement. Once a fresh tenancy by holding over is established, it stands on the same footing as any other periodic tenancy and can be determined only by a Section 106 notice; the new tenancy is monthly or yearly according to the purpose of the lease.