V.K.Deshpande (Agriculture) 18 November 2009

Sale of Leasehold rights

A enters into Permanent Lease agreement with B(industry)

B goes bankrupt,High court liquidator assigns leasehold rights to C(another company),Lease continued.

C becomes a sick company and "sells"leasehold rights to D(aneducational insititution),without knowledge of owwner.

Owner wants to sell the land (or increase lease amount)

Original lease agreement is silent on sale of leasehold rights orincrase in lease amount,in case of transfer of rights.

Can the owner sell the land/lease/or incrase the amount.?Or seek eviction of the new tenant?

Please clarify.

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2 Replies

Raj Kumar Makkad (Adv P & H High Court Chandigarh) 19 November 2009

As lease agreement is silent on the procedure to deal with the changed circumstances so it is better to deal afresh and amount of lease can be enhanced as a result of such negotiation.

P V Namjoshi (pvnamjoshi@gmail.com) 17 April 2011

Municipal corporation granted lease for 99 years for construction of immovable property like houses and shops. The party did it and sub leased to others. A party wishes to purchase lease right for himself for remaining period. Is it necessary to involve the lessor ?The agreement gives right to ltransfer lease rights.

My say: Lessor need not be involved,not compulsory.

Lease right may be transferrable by lease rent but cannot be transefrred by sale as the lessee has no salble title.

Request for an answer.

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