Penal lease-premium provisions apply only to existing leases, not to money received under an executory agreement to lease.

Section 18(1) of the Bombay Rents, Hotel and Lodging House Rates Control Act, 1947 is penal in nature and applies only to receipt of a fine, premium or like sum in respect of the grant, renewal or continuance of an actual lease. Money received under an executory agreement to grant a lease of premises under construction does not attract the provision because no completed landlord-tenant relationship or demise has yet come into existence. The surrounding definitions and scheme of the Act reinforce that the section is directed to existing leases, not mere future promises to lease. On that footing, the conviction could not stand and acquittal followed.

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Issues: Whether receipt of money under an executory agreement to grant a lease of premises under construction falls within the mischief of section 18(1) of the Bombay Rents, Hotel and Lodging House Rates Control Act, 1947.

Analysis: Section 18(1) penalises receipt of a fine, premium or other like sum in respect of the grant, renewal or continuance of a lease. The expression is read in the context of an existing lease or a lease coming into existence, and the provision is penal in nature, so it cannot be extended by strained construction. Where only an executory agreement exists and the lease has not come into existence, there is no completed landlord-tenant relationship and no demise capable of attracting the section. The surrounding provisions of the Act, including the definitions of landlord and tenant and the application of Part I to premises let, support the view that the section is directed to actual leases, not merely promises to lease in future.

Conclusion: Receipt of money on an executory agreement to grant a lease does not fall within section 18(1); the conviction could not stand and the appellants were entitled to acquittal.

Ratio Decidendi: A penal provision forbidding receipt of premium in respect of the grant of a lease applies only where a lease exists or comes into existence, and cannot be extended to money received merely under an executory agreement to lease.

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