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A manufacturing lease ends. The tenant remains in possession and the lessor accepts rent for the…

Under section 116, continued possession with the lessor's acceptance of rent or other assent can renew the lease, subject to an agreement to the contrary. Section 106…

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A manufacturing lease ends. The tenant remains in possession and the lessor accepts rent for the continuing occupation. There is no agreement to the contrary and no local law or usage to the contrary. Under sections 106 and 116 of the Transfer of Property Act, 1882, how does the lease renew?

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Answer and explanation

Correct answer B

Under section 116, continued possession with the lessor's acceptance of rent or other assent can renew the lease, subject to an agreement to the contrary.

Section 106 supplies the renewal period by purpose. The manufacturing lease in the question renews from year to year in the absence of contrary contract, local law or usage.

Option feedback

Option A

The month-to-month default applies to a lease for a purpose other than agriculture or manufacturing, subject to the statutory qualifications.

Option B

Section 116 renews the lease in the applicable period under section 106. For manufacturing the default is year to year.

Option C

Section 116 does not prescribe a fixed two-year renewal.

Option D

Holding over produces the statutory periodic renewal. It does not repeat the original fixed term.

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