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Issues: Whether acceptance of rent by the landlord after expiry of the contractual lease created a fresh tenancy by holding over under section 116 of the Transfer of Property Act, 1882, so as to require longer notice for termination.
Analysis: The tenancy had expired by efflux of time, and the tenants remained in possession under the protection of rent control legislation. Acceptance of amounts equivalent to rent in such circumstances did not, by itself, show assent to a new contractual tenancy. Section 116 contemplates a bilateral arrangement, requiring both the lessee's offer to continue and the landlord's clear assent; where the tenant stays in possession by statutory protection, payment of rent is ordinarily referable to that status and not to an offer for a fresh lease. No independent material showed that the landlord and tenants intended to enter into a new tenancy after expiry of the lease.
Conclusion: No tenancy by holding over was created, and the tenants were not entitled to the six months' notice claimed on the footing of a renewed manufacturing lease.
Ratio Decidendi: Under section 116 of the Transfer of Property Act, 1882, a fresh tenancy arises only on clear bilateral assent to continue the tenancy, and mere acceptance of rent from a tenant protected by rent control law does not by itself create holding over.
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