Lessee Mutating Own Name As Owner & Mortgaging Property Amounts To Denial Of Title Leading To Lease Forfeiture: Bombay High Court

"Basic structure of the property was of religious inam trust and the tenant can not be allowed to change the basic structure of the property and again can claim innocence... by posing itself as a owner, the defendant trust has changed the character of the property," Bombay High Court, in a significant ruling dated May 8, 2026, held that a lessee who moves to mutate their name as the owner in revenue records and mortgages the leasehold property without permission effectively denies the landlord's title.

A Single Bench of Justice Arun R. Pedneker observed that such acts trigger the forfeiture of the lease under Section 111(g) of the Transfer of Property Act, 1882, regardless of the long-term nature of the lease.

The Court emphasized that when a tenant conducts themselves as the absolute owner—specifically by applying for the conversion of 'Inam' land and deleting the lessor's name from revenue records—they renounce their character as a lessee. The bench noted that the law does not permit a tenant to surreptitiously alter the legal status of a religious trust property and then plead innocence during eviction proceedings.

The dispute involved a 99-year registered lease executed in 1992 by the Nagapur Masjid Trust (Lessor) in favour of the Late Kakasaheb Mhaske Medical Foundation (Lessee) for educational purposes. In 2004, the Masjid Trust terminated the lease and sought eviction, alleging that the Foundation had violated lease terms by subletting the property, using it for commercial gain, and most critically, asserting ownership over the land. While the Trial Court dismissed the suit, the First Appellate Court reversed the decision, ordering eviction on the ground of denial of title.

The primary question before the court was whether the First Appellate Court exceeded its jurisdiction by granting an eviction decree on the ground of "denial of title" when the same was not specifically pleaded in the original plaint. The court was also called upon to determine whether a termination notice under Section 111(g) of the Transfer of Property Act is valid if it does not explicitly specify the sub-clause under which forfeiture is sought.

Pleadings Must Be Construed Liberally To Ascertain Substance Over Form

The Court addressed the appellant's primary contention that the plaintiff had not specifically used the phrase "denial of title" in their pleadings. Justice Pedneker observed that pleadings in Indian courts should not be understood in a pedantic or hyper-technical sense. He noted that the object of pleading is simply to ensure that the adversary is not taken by surprise and knows the case they have to meet.

Relying on the Supreme Court's ruling in Ram Sarup Gupta v. Bishun Narain Inter College, the Court held that it is the duty of the judiciary to ascertain the substance of the pleadings. If the parties are in full knowledge of the case and have led evidence on an issue, a finding can be rendered even without a specific issue being formally framed.

"The pleadings however should receive a liberal construction; no pedantic approach should be adopted to defeat justice on hair-splitting technicalities."

Evidence Beyond Pleadings Admissible If Parties Go To Trial With Full Knowledge

The Bench highlighted that during the trial, the plaintiff trust had produced documents showing that the defendant foundation had applied for the conversion of the 'Inam' land—an act that only an owner is entitled to perform. The defendant was cross-examined on mortgage deeds and revenue entries where they were listed as the owner, and no objection was raised regarding the admissibility of this evidence at that stage.

The Court found that since the defendant had the opportunity to defend these documents and admitted their signatures on the mortgage deeds, they could not claim to be taken by surprise. The Bench held that the "denial of title" was intrinsic to the pleadings, as the plaintiff had explicitly described the unauthorized land conversion and mortgage acts.

Acts Of Ownership By Lessee Amount To Disclaimer Of Lessor’s Title

The High Court scrutinized the conduct of the Medical Foundation, noting that they had moved the State Government to delete the suit land from the "Deosthan Inam Class-III" category. Following this, the name of the Masjid Trust was deleted from the ownership column of the revenue records and replaced by the Foundation’s name. The Foundation also posed as the owner while submitting development plans to the Municipal Corporation.

The Court held that these administrative maneuvers constituted a clear renunciation of the lessee's character. By mortgaging the property and the constructions thereon to secure loans without the lessor's permission, the Foundation acted in total derogation of the landlord's rights, satisfying the conditions for forfeiture under Section 111(g)(2) of the Transfer of Property Act.

"The defendant trust has not only got deleted the suit property from Deosthan Inam Class-III, but also deleted the name of Deosthan trust in the ownership column... the tenant can not be allowed to change the basic structure of the property."

Section 111(g) Notice Mandatory For All Sub-Clauses Of Forfeiture

The Court then interpreted the statutory requirements for determining a lease by forfeiture. It noted that Section 111(g) requires a lessor to give notice in writing of their intention to determine the lease. The Bench clarified that the phrase "in any of these cases" within the section implies that a notice is mandatory for all three sub-clauses: breach of express condition, denial of title, and insolvency.

However, the Court rejected the argument that the notice must specify the exact sub-clause of Section 111(g). It held that as long as the notice clearly expresses the intention to terminate the tenancy due to the lessee's conduct, it is legally valid. In this case, the notice issued in August 2004, which cited multiple breaches and the intention to forfeit the lease, was found to be sufficient.

"The only essential condition is to terminate/determine the lease so as to claim back possession. There is no requirement of law that the notice has to indicate the specified sub-clauses of Section 111(g)."

The High Court concluded that the Foundation's attempt to convert the religious trust property into its own asset was a grave breach that justified eviction. All substantial questions of law were answered against the appellants. The Second Appeal was dismissed, affirming the First Appellate Court's decree for possession. However, at the request of the appellants, the Court granted a status quo order for eight weeks to allow them to explore further legal remedies.

Date of Decision: 08 May 2026