K. N. SETH, J. The suit giving rise to the appeal was filed by the plaintiff-respondent praying for, (1) a declaration that they were tenants of the land in dispute and were entitled to retain and continue their possession over it as such, (2) actual and complete possession over the plot as well as of the shops constructed thereon and (3) re covery of Rs. 262. 50 and future and pendente-lite damages for use, and occupation at the rate of Rs. 751- per month. The case set up by the plaintiffs was that the land in question was the property of the Muni cipal Board, Budaun, that the Board vide its resolution No. 17 dated February 26, 1961 agreed to let out the land to the plaintiffs at a rental of Rs. 120 per year; that the plaintiffs raised construction over the land after obtaining the sanction and approval of the Board; that the plaintiffs regularly paid rent to the Board which was accepted by it uptil the year 1967-68 that the plaintiff; their father and defendants No. 2 and 3 entered into a partnership about three years back but after the death of their father, the plaintiff terminated the partner- ship by a notice dated May 28, 1969 and asked defendants No. 2 and 3 to vacate the shops in suit which was in their possession on behalf of the plaintiffs as partners; that the defendants claimed themselves to be tenants on behalf of the Board that defendant No. 1 attempted to realise rent from defendants No. 2 and 3, that the Board had no right to create a tenancy in favour of defendants No. 2 and 3 during the subsistence and continuance of the tenancy of the plaintiffs that the Board illegally refused to accept rent remitted by the plaintiffs for the period 1968-69 that defendants No. 2 and 3 inspite of demand to that effect refused to vacate and deliver possession of the shops to the plaintiffs, hence the suit. The suit was contested by defendants No. 1 and 2 and it proceed ed ex parts against defendant No. 3. The suit was contested by defendants No. 1 and 2 and it proceed ed ex parts against defendant No. 3. The Board admitted that vide its resolution dated February 26, 1961 it accorded its assent to the re quest of the plaintiffs and let out the land to the plaintiffs subject to the condition that the rights would be renewed each year and the cons tructions to be ereeuted on the land would be the property of the Board. The plaintiffs neither got the rights renewed nor completed any validly executed agreement and thus acquired no rights in the land in suit. It was asserted that defendant No. 2 was found in actual possession over the shops in suit and in order to regularise the matter a lease was got executed by defendant No, 2 whereby he became a tenant of the shops in dispute. It was also pleaded that the suit was barred by Section 326 of the U. P. Municipalities Act, Defendant No. 2 filed a separate written statement contending that he was a tenant of the shops on a rent of Rs. 201- per month. The trial court decreed the suit holding that the plaintiffs were the lessees of the land in suit and their rights had not come to an end. On the finding that the Board had no right to let out the land and the shops in question to defendant No. 3 he was entitled to remain in possession thereof. It was further held that the partnership did not create any tenancy rights in favour of defendants No. 2 and 3 and as the partnership had been dissolved the plaintiffs were entitled to exclusive possession over the land and the shops. The plea that the suit was barred by Section 326 of the U. P. Municipalities Act was negatived on the finding that a notice under the aforesaid provision had been served on the Board. The claim of the plaintiffs for dam ages was dismissed. The Board submitted to the decree. The learn ed District Judge dismissed the appeal of defendants No. 2 End 3 and the cross-objection filed by the plaintiffs with regard to the dismissal of their claim for damages and mesne profits. The defendants No. 2 and 3 have come up in appeal to this Court and the plaintiffs have filed a cross-examination. The learn ed District Judge dismissed the appeal of defendants No. 2 End 3 and the cross-objection filed by the plaintiffs with regard to the dismissal of their claim for damages and mesne profits. The defendants No. 2 and 3 have come up in appeal to this Court and the plaintiffs have filed a cross-examination. Sri S. P. Gupta, learned counsel for the appellants, contended that no valid lease came into existence and the plaintiffs never acquir ed the status of tenants. On the premises that the plaintiffs were mere licensees, they were not entitled to claim possession over the land and the shops in dispute over which the appellants were in pos session under a valid lease from the Board. It is not in dispute that on the application of the plaintiffs the Board passed resolution No. 17 dated February 26, 1961 letting out the. land to the defendants. The resolution, which has been set out in the written statement filed by the Board, runs as follows: - (Resolution in Hindi omitted) The resolution is to the effect that the land be let out to the plaintiffs for one year on an annual rent of Rs. 12/- on condition that the lease would be renewed each year and the constructions raised thereon by the plaintiffs would be the property of the Board. Reference to the said resolution and the terms of letting out the land in question are endorsed on the back of the map filed with the application for letting out the land to the plaintiffs. There is no dispute that in pursuance of the resolution the plaintiffs were put in possession of the land and the stipulated rent paid by them was accepted by the Board. It is further admitted that no formal lease deed came into existence as envisaged in the aforesaid resolution. However, the plaintiffs execut ed a Qabuliat dated March 16, 1961 (Ex. 15) which makes reference to the resolution of the Board. The Board issued receipts for the rent realised and raised no objection to the continuance of the plain tiffs in possession of the land and the shops constructed thereon. However, the plaintiffs execut ed a Qabuliat dated March 16, 1961 (Ex. 15) which makes reference to the resolution of the Board. The Board issued receipts for the rent realised and raised no objection to the continuance of the plain tiffs in possession of the land and the shops constructed thereon. Learned counsel contended that the documents on record, spe cially the resolution of the Board, and the Qabuliat executed by the plaintiffs, the pleadings of the parties and also their conduct indicate that the parties intended the lease to be from year to year, i. e. , for a period exceeding one year. Such a lease is required to be in writing and registered and since these formalities were not complied with no valid lease for any period came into existence and the plaintiffs never acquired the status of leases. In support of this argument it was point ed out that the application made by the plaintiffs prayed for letting out the land on a proper rent without specifying the period. In the resolution sanctioning the grant of lease an yearly rent was fixed. The subsequent application of the plaintiffs for sanction and approval of the plan of construction to be raised on the land was also a pointer to the fact that the lease was intended to be for more than one year for no one would have decided to raise any substantial construction if the lease of the land was limited in its duration to one year or less. Special emphasis was laid on the undertaking of the plaintiffs con tained in the Qabuliat that they will be paying rent to the Board regularly. The argument is apparently plausible but on a deeper scrutiny it must be rejected as untenable. The argument ignores the term of the resolution which specifically states that the land is being let out for" period of one year and further provides that the lease would be renewed every year. If the intention had been to let out the land initially for a term exceeding one year, there was no sense in providing for its renewal every year. The intention appears to be that the initial period of lease would be only one year but it would be open to the parties to have it renewed after the expiry of that period. The intention appears to be that the initial period of lease would be only one year but it would be open to the parties to have it renewed after the expiry of that period. The mere fact that a certain amount of rent is to be paid for the year to which it relates does not make the lease a lease from year to year, i. e. , for a. period exceeding one year. The provisions of Section 107 of the Transfer of Property Act are not attracted to such a lease and it need not be in writing and registered. The plaintiffs could have reasonably expected that in normal course the lease would be renew ed from year to year and if on that basis he decided to raise some constructions, which have not been shown to be very valuable. It could be termed wholly unnatural or unjustified. It might not have been a very wise decision but persons desirous of expanding business do often take calculated risks. Moreover when the resolution itself is clear and unambiguous on the initial term of the lease, the conduct of the plaintiffs need not be taken into consideration in determination the intention of the parties with regard to the initial terms of the lease. After the resolution of the Board the plaintiffs were put in possession of the land, the stipulated rent was paid regularly and was accepted by the Board which clearly indicate that the lease was renewed from year to year. As the initial lease was not re quired to be in writing and registered, leases for the subsequent period could also be validly made orally. It is not correct to contend that no valid lease in favour of the plaintifis ever came into exist ence and at best their status was only of licensees. A lease not ex ceeding one year can be created by oral agreement accompanied by delivery of possession. In the present case all the necessary ingredi ents for conferring the status of lessees on the plaintiffs are present and it must be held that the plaintiffs entered into possession of the land as lessees and not as licensees. The next question for determination is with regard to the status of the plaintiffs after the lapse of the original period of the lease. The next question for determination is with regard to the status of the plaintiffs after the lapse of the original period of the lease. It was contended that under the resolution of the Board if the plaintiffs wanted to continue as tenants, they must have got the lease renewed and as admittedly no renewal took place, the tenancy came to an end. The argument is misconceived. After the expiry of the initial period of the lease, the renewal of the lease could be brought about not merely by execution of a deed of lease but the same result could be achieved by the parties by continuance of the plaintiffs in possession and by acceptance of rent by the Board. There appears to be no subs tance in the argument that after the expiry of the one year period, the status of the plaintiffs as lessees came to an end into facto. I am not prepared to read in the renewal clause contained in the resolution and intention to the effect that unless the lease is renewed in writing the relationship of the landlord and tenant would come to an end. The status of a tenant who has remained in possession after the determination of the tenancy and rent is acceptd by the lessor or he otherwise assents to his continuance in possession is recognised in Section 116 of the Transfer of Property Act which provides: - "if a lessee or under-lessee of property remains in possession thereof after the determination of the lease granted to the lessee, and the lessor or his legal representative accepts rent from the lessee or under-lessee, or oherwise assents to his continuing in possession, the lease is, in the absence of an agreement to the contrary, renewed from year to year, or from month to month, according to the purpose for which the property is leased, as spe cified in Section 106. " In the present case the lessees remained in possession after the deter mination of the original period of the lease. They paid rent regularly which was accepted by the lessor and he assented to their continuing in possession. Abid Husain (D. W. 2), the Nazool clerk in the Muni cipal Board, specifically admitted in his cross-examination that the plaintiffs continued to be tenants during the period for which they paid rent. They paid rent regularly which was accepted by the lessor and he assented to their continuing in possession. Abid Husain (D. W. 2), the Nazool clerk in the Muni cipal Board, specifically admitted in his cross-examination that the plaintiffs continued to be tenants during the period for which they paid rent. In the absence of even a whisper that the continued pos session of the plaintiffs was in pursuance of any agreement to the contrary the plaintiffs must be held to be tenants holding over within the meaning of Section 116 of the Transfer of Property Act. Learned counsel for the appellants, in support of the contention that after expiry of the initial period of lease the status of the plain tiffs as tenants became extinguished, placed reliance on Birendru Pratap Singh and another v. Gulwant. Singh and others A. I. E. 1968 S. C. 1068. In that case the plaintiff was a sub- lessee of the ex-proprietary tenant of the disputed land and the sub-lease commenced from the beginning of the Fasli year. In pursuance of the sub-lease he entered into possession. The tenant surrendered his tenancy rights to the landlord but the sub-lessee continued to remain in possession. In view of Section 47 (1) of the U. P. Tenancy Act it was held that the tenant lost his rights from the date of the surrender and the rights of the sub-ten ant also became extinguished from that date. Thereafter his posses sion could not be in the capacity of the sub-tenant. The principles laid down in the aforesaid case are not attracted to the facts of the present case. The plaintiffs were tenants in their own right. They continued in possession even after the expiry of the initial period of the lease, paid rent to the landlord which was accepted without objection. Their rights did not come to an end ipso facto on the expiry of the initial period of the lease. Even if it be assumed that the intention of the parties was to create a lease for more than one year and no such operative lease came into existence in the absence of a registered instrument signed by the landlord, but in view of the fact that the plaintiffs continued in possession of the property and the Board willingly accepted rent, a valid tenancy came into existence. The duration of such a tenancy is governed by the principle laid down in Section 106 of the Transfer of Property Act and on the facts of the present case it would be a tenancy from month to month. This view finds support from the principle laid down in Ram Kumar Das v. Jagdiah Chandra Deo A. I. R. 1952 S. C. 23. In that case the defendant executed a Qabuliyat in favour of the receiver who was in charge of the plaintiffs estate by which he pur ported to take a settlement of land in suit for building purposes for a period of 10 years at an annual rent. The Qabuliyat not being an ope rative document under Section 107 of the Transfer of Property Act, the question was whether the tenancy created by implication of law was a monthly tenancy under Section 106 of the Transfer of Property Act. The Court held that the tenancy created by implication of law in favour of the defendant should be held to be from month to month since its inception. The tenancy not being for manufacturing or agricultural purposes, it could be regarded as a tenancy from month to month under Section 106, unless there was a contract to the con trary. The stipulation as to payment of annual rent would no doubt raise a presumption that the tenancy was from year to year but being contained in an inoperative document could not come in the way of raising presumption under Section 106. A lease for one year could not be inferred from the payment of annual rent because to do so would be to substitute a new agreement for the parties which they never intended to do. This case is an authority for the proposition that even where the parties intended to create a tenancy for more than a year but such a tenancy does not come into existence in the "absence of a registered instrument as contemplated by Section 107 of the Transfer of Property Act but the tenant continues in possession and rent is willingly accepted by the landlord for some time, a valid tenancy comes into existence and its duration would be in accordance with the provisions contained in Section 106 of the Transfer of Pro perty Act. The case further lays down that the stipulation as to the payment of annual rent does not militate against the creation of a monthly tenancy. It also negatives the contention of the learned counsel for the appellants that in the absence of a registered instru ment the status of the plaintiffs- respondent would be that of licensees. The principle laid down in Ram Kumar Das v. Jagdish Chandra Deo (supra) has not been departed from in Delhi Motor Co. and others v 17. S. Basrurkar A. I. R. 1968s. C. 794. In that case the plaintiff a partnership firm entered into a contract with the defendant company for taking a sub-lease of a building of which the company was a tenant. The contract was evidenced by three unregistered documents which did not in terms purport to be a sub-lease and was given the form of a partnership in order to avoid the liability to ejectment under the Rent Control Law. The documents indicated that the profit share of the defendant com pany would be 10 per cent and will be settled at the end of the first closing of the financial year on June 30, 1951. On an interpretation of this stipulation the Court held that the lease, if any, brought into existence was for a period exceeding one year, as the rent was at 10 per cent of the net profit earned by the firm between April 1, 1950 to June 30, 1951, that is for a period of 15 months. The term clearly laid down that the first payment of rent was to be for a period of one year and three months so that, even though no further period for the con tinuance of the lease after June 30, 1951 was laid down, the lease made rent payable for the first period of fifteen months. The lease was, therefore, at least for a minimum period of fifteen months and Section 107 of the Transfer of Property Act was clearly applicable. Such a lease could not have been validly made except under a regis tered instrument. On the evidence the Court further found that there was no material to show that the lease was to be from month to month and as such Section 106 of the Transfer of Property Act was inapplicable. Such a lease could not have been validly made except under a regis tered instrument. On the evidence the Court further found that there was no material to show that the lease was to be from month to month and as such Section 106 of the Transfer of Property Act was inapplicable. The ratio of the case appears to be that if initially a valid lease does not come into existence, no enforceable rights are acquired by the party claiming under such a lease. In the present case, as held earlier, a valid lease for one year came into existence in favour of the plaintiffs and thereafter they became tenants holding over by being in possession and by acceptance of rent by the landlord for a number of years. The principle laid down in the Delhi Motor Company case is, therefore, of no assistance to the appellants. Reliance was placed on Basdeo Rai v. Dwarka Ram and another A. I. B. 1916 Alld. 219, for the proposition that the plaintiffs were not entitled to posses sion and their remedy lay to recover damages as licensees for the wrongful act of the licensor. In that case an oral agreement was arrived at between the parties for constructing a gola or a market place on a plot of land. The plaintiffs agreed to pay Rs. 6|- annually as ground rent. The construction of a gola was started but before it could be completed, dispute arose between the parties and the plain tiffs were dispossessed. Admittedly no document was executed much-less registered. The period for which the land was given to the plain tiffs was not specified. It is not clear from the judgment whether any rent was paid to the landlord. On the facts of the case the Court inferred that the agreement between the parties was to lease out the land for a period exceeding one year and it held that as no valid lease came into existence, the plaintiffs acquired no title in respect of the land and, therefore, were not entitled to claim possession as lessees. On the footing that the plaintiffs were licensees, it was observed that their remedy lay not in a suit for possession but in a suit for damages on the ground that the licences had been improperly revolved. On the footing that the plaintiffs were licensees, it was observed that their remedy lay not in a suit for possession but in a suit for damages on the ground that the licences had been improperly revolved. The ratio of this case is wholly inapplicable to the suit giving rise to the present appeal. The plaintiffs entered into possession as tenants and continued in possession as tenants holding over. Admittedly their tenancy has not been terminated by a valid notice. During the subsisted a of their lease the Board was not competent to grant a lease in for/our of defendants No. 2 and 3. The partnership under which the afore said defendants came in possession of the shops has come to an end. They have no subsisting right to remain in possession. The suit for possession by ejectment of the defendants has been rightly decreed. The cross-objection relates to the relief for damages for use and occupation of the shop in suit at the rate of Rs. 75/- per month. The basis of the claim as admitted by Pooran Lal in his statement was on account of loss of business profit. He further stated that he had not claimed the damages on any other account. In the plaint the claim for damages was not made on the basis of any loss of business profit. In such a situation the courts below were justified in rejecting the claim for damages. In the result, the appeal as well as the cross-objection are dis missed with costs. .