A. K. SIKRI ( 1 ) THE plaintiff herein, which is a company incorporated under the Companies Act, 1956, became tenant under the defendant in respect of office space bearing No. 502-503, having super area of 1656 sq. ft. situated on Firth Floor, Arunachal Bhawan, 19, Barakhamba Road, new Delhi on a monthly rent of Rs. 1,65,600. 00. Tenancy started w. e. f. 15/08/1995. It was a monthly tenancy commencing on 15th of each calendar month and ending with 14th of the following month. At the time of taking the premises on rent, the plaintiff paid a sum of rs. 9,93,600/- as security deposit which was equivalent to six month rent. This security was interest free security which was refundable on the expiry or termination of the lease. The plaintiff had also paid advance rent equivalent to six months rent amounting to Rs. 9,93,600. 00 this rent was to be adjusted against monthly rent. ( 2 ) IT appears that after enjoying the tenancy for few months, the plaintiff desired to vacate the same. As per the case of the plaintiff putforth in the plaint, the tenancy was terminated vide notice dated 18/01/1997 w. e. f. expiry of the 14/02/1997. This notice was sent by the plaintiff to the defendant calling upon the defendant to take the vacant possession of the flat in question (hereinafter REFERRED TO as the tenanted premises ) on the expiry of 14/02/1997 i. e. on 15/02/1997. The defendant was also called upon to return the security amount of Rs. 9,93,600. 00 as well as Rs. 1,09,065. 00 which was unadjusted money given by the plaintiff to the defendant towards advance rent. The plaintiff also called upon the defendant to pay interest at the rate of 24 per cent per annum w. e. f. 15/02/1997 in case the amount is not refunded. It was also stated that the tenanted premises shall remain vacant at the risk of the defendant and the plaintiff shall not be liable to pay any rent from that date. It is the case of the plaintiff that the defendant is not entitled to any rent w. e. f. 15/02/1997. As the defendant has failed to refund the aforesaid amount demand by the plaintiff, it has filed the present suit for recovery of Rs. 11,53,921. It is the case of the plaintiff that the defendant is not entitled to any rent w. e. f. 15/02/1997. As the defendant has failed to refund the aforesaid amount demand by the plaintiff, it has filed the present suit for recovery of Rs. 11,53,921. 00 the details of which are given in para-7 of the plaint and read as under: ( 3 ) THE defendant has not only contested the suit but has also come out with her counterclaims. The defendant has admitted the letting out of the tenanted premises in question to the plaintiff. The defendant has also admitted that the rental agreed was Rs. 1,65,600. 00 per month. It also stands admitted that six months advance rent amounting to Rs. 9,93,600. 00 and security deposit of Rs. 9,93,600. 00 was also given to the defendant at the time of letting. It is stated that the advance rent was to be adjusted over a period of 36 months by adjusting the same at the rate of Rs. 27,600. 00 and the plaintiff was to pay Rs. 1,38,000. 00 per month as rent after adjusting the sum of Rs. 27,600. 00 from the advance rent. ( 4 ) THE defence putforth by the defendant in the written statement-cum-counter-claims is that the plaintiff had financial crunch and it was not able to meet and honour its commitments. It defaulted in paying rents as become due, from June, 1996. In these circumstances, the defendant served a notice on 3/09/1996 calling upon the plaintiff to clear the arrears of rent failing which the defendant would file winding up petition against the plaintiff. Thereafter, the plaintiff made payments of rent till October, 1996 at the rate of Rs. 1,38,000. 00 per month. However, from November, 1996 the plaintiff again defaulted in paying rents and in order to wriggle out of its obligation the plaintiff caused a notice dated 18/01/1997 served upon the defendant. It is also averred that since the plaintiff was committed to continue paying the rents till July, 1998 (i. e. three years of period of tenancy) it had no right to call back the advance, unadjusted rent as well as security deposited with ,e defendant. The plaintiff was apprised of it by communication dated 6/02/1997. The plaintiff was also asked to deliver the possession of the suit premises. The plaintiff was apprised of it by communication dated 6/02/1997. The plaintiff was also asked to deliver the possession of the suit premises. However, the plaintiff neither delivered the possession to the defendant nor it paid arrears of rent from November, 1996. The plaintiff wrote another letter dated 14/04/1997 which was replied to by communication dated 26/04/1997 calling upon the plaintiff to deliver the possession of the suit premises. However, the plaintiff having failed to deliver the premises, the defendant has stated that the defendant is entitled to rents for the periods after 15/02/1997 also till the delivery of possession of demised premises. In this way the defendant s case is that the plaintiff is not entitled to any amount and rather it owes a sum of Rs. 2,83,728. 00 to the defendant which is set up as a counter-claim. ( 5 ) THE plaintiff has filed replication-cum-reply to the counter-claims to which the defendant has filed replication. In these pleadings, the respective averments made by the parties and as noted above, are reiterated by them. ( 6 ) ON the basis of the pleadings between the parties, the following issues were framed on 17/08/1998: 1. Whether the plaintiff is duly incorporated company and the suit has been signed, verified and instituted by an authorised person on behalf of the plaintiff? OPP 2. Whether the plaintiff could not terminate the tenancy prior to the expiry of period of three years? If so, to what effect? 3. Whether the plaintiff had offered to surrender the actual vacant possession of the premises on 14-2-97? If so, to what effect? 4. When was the possession actually surrendered/taken possession of by the defendant? 5. Whether the plaintiff is entitled to interest? If so, at what rate and for what period? 6. To what amount, if any, is the plaintiff entitled to? 7. Whether the defendant is entitled to sum claimed by her in the Counter claim? 8. Whether defendant is entitled to claim rent till the premises is re-let to another tenant, if so to what effect? 9. Whether the Counter claim has not been valued properly for purposes of Court fee? 10. Relief. ( 7 ) IN support of the plaintiff s case, the plaintiff has produced two witnesses, namely, sh. S. K. Shukia, who is working as Deputy Manager in the plaintiff company and sh. Panchanand, its Company Secretary. 9. Whether the Counter claim has not been valued properly for purposes of Court fee? 10. Relief. ( 7 ) IN support of the plaintiff s case, the plaintiff has produced two witnesses, namely, sh. S. K. Shukia, who is working as Deputy Manager in the plaintiff company and sh. Panchanand, its Company Secretary. The defendant has, on the other hand, produced her husband, Mr. Rajiv Khanna, as a witness to depose in support of her claim. ( 8 ) I have gone through the pleadings, documents as well as oral evidence. After analysing the same, my finding in respect of each issue is as under: ISSUE No. 1. Whether the plaintiff is duly incorporated company and the suit has been signed, verified and instituted by an authorised person on behalf of the plaintiff? ( 9 ) TO prove this issue, Mr. S. K. Shukla while deposing stated that he had brought the certificate of Incorporation of the plaintiff company. At that stage learned counsel for the defendant gave a statement to the effect that he was not disputing the incorporation of the plaintiff company. In so far as the authority of Mr. Rajiv Kapoor, Senior Manager to sign, verify and institute the suit is concerned, Sh. Panchanand Singh, Company Secretary of the plaintiff company produced the Minutes Book of the Meeting of Board of Directors containing resolution dated 29/03/1997 which was proved as Ex. PW-2/1. He deposed to the effect that Mr. Rajiv Kapoor had signed and verified the plaint and he had seen him signing although he joined the service after Mr. Kapoor had left. In the cross-examination of this witness, genuineness of Ex. PW-2/1 is not questioned. However, on question put to this witness as to how he saw Mr. Rajiv Kapoor signing, he replied that Mr. Kapoor used to come to the office as he was legal counsel of the plaintiff company and in that capacity he saw him signing the legal papers. There is no reason not to believe this witness when the capacity of mr. Rajiv Kapoor as legal counsel and visiting the office of the plaintiff company is not disputed. Therefore, from the evidence on record, it stands established that Mr. Rajiv Kapoor was given authority vide Resolution dated 29/03/1997 (Ex. PW-2/1) to sign and verify the pleadings and institute the present suit. Rajiv Kapoor as legal counsel and visiting the office of the plaintiff company is not disputed. Therefore, from the evidence on record, it stands established that Mr. Rajiv Kapoor was given authority vide Resolution dated 29/03/1997 (Ex. PW-2/1) to sign and verify the pleadings and institute the present suit. Thus this issue stands decided in favour of the plaintiff and against the defendant. ISSUE No. 2. Whether the plaintiff could not terminate the tenancy prior to the expiry of period of three years? If so, to what effect? ISSUE No. 8. Whether defendant is entitled to claim rent till the premises is relet to another tenant, if so to what effect? ( 10 ) AS mentioned above, letting out of the premises at specified rate is not in dispute. It is also not in dispute that the tenancy started on 15/08/1995. It is further not in dispute that no lease agreement was signed between the parties. In the absence of any lease agreement between the parties, tenancy shall be from month to month determinable as per the provisions of Section 106 of the Transfer of Property Act, 1882 (for short the Act ). There is nothing on record as per which it could be claimed by the defendant that the tenancy was for a period of three years which could not be terminated prior to the expiry of period of three years. The only fact from which the defendant is drawing support is that the advance rent of rs. 9,93,600/- given by the plaintiff to the defendant at the time of letting out of the premises was adjustable over a period of 36 months. That may be so. However, from this fact alone one cannot come to the conclusion that a legal and valid contract for creating a tenancy for a period of 36 months was arrived at between the parties. If the contention of the defendant is to be accepted, namely, the period of tenancy was 36 months then such a lease had to be in writing and was compulsorily registrable as per the provision of the Section 107 of the Act. The lease for a period of more than 11 months had not been created in the manner provided under Section "107 of the Act. ( 11 ) INTERPRETING the provisions of this Section, Division Bench of this Court in M/s. Uptron powertronics Ltd. Vs. The lease for a period of more than 11 months had not been created in the manner provided under Section "107 of the Act. ( 11 ) INTERPRETING the provisions of this Section, Division Bench of this Court in M/s. Uptron powertronics Ltd. Vs. G. R. Rawal reported in AIR 1999 Delhi 377 held that any extension or renewal of an earlier lease could only be done by a registered Lease Deed keeping in view the provisions of Section 107 of the Transfer of Property Act and in the absence thereof even if the extension was in writing it would only create month to month tenancy. Following observations of the Division Bench in the aforesaid case address the controversy in issue: "the next question that arises is whether a fresh lease deed or an extension/renewal of the earlier lease deed is required to be through a registered instrument. There is no dispute that the lease was intended for a block of three years at a time. As a result, the parties entered into an agreement in 1990, 1993 and eventually in 1996. Paragraph 1 of Section 107 of the Act makes it very clear that a registered instrument can only make a lease of immovable property exceeding one year. Admittedly, in the present case apart from the lease deed entered into between the parties on 17/07/1984 the parties drew up no registered instrument. It is, therefore, quite clear that in the absence of a registered instrument, the necessary consequences will flow. This means that the tenancy was only on a month to month basis. Consequently, the respondent could terminate the tenancy by a notice under section 106 of the Act which in fact, he did by issuing a notice dated 2/04/1997 followed by another notice dated 5/11/1997. However, in the present case, the extension in the second and subsequent block of three years was not by a registered instrument; consequently, it was only a month to month tenancy which could be (and was) terminated in accordance with the provisions of Section 106 of the Act". ( 12 ) AT this stage one may also quote the following from the decision in the case of Shukla malhotra and Others Vs. Vyasa Bank Ltd. 1998 Vol. 73 DLT 124, echoing same view: "section 107 of the Act describes the mode of making leases. ( 12 ) AT this stage one may also quote the following from the decision in the case of Shukla malhotra and Others Vs. Vyasa Bank Ltd. 1998 Vol. 73 DLT 124, echoing same view: "section 107 of the Act describes the mode of making leases. It lays down that a lease of immovable property for a fixed term or for a period exceeding one year can be made "only" by a registered instrument. The use of the expression "only" in the section indicates that the specific mode prescribed therein has to be adhered to strictly, failing which any instrument purporting to lease out the premises for a period exceeding one year or extend it likewise orally or in writing would be void and presumption about duration of lease under Section 106 of the Act will apply. As per section 106 a lease from month to month or a lease other than a lease from year to year is terminable by fifteen days notice. Thus, in the present case, continuance of defendant s possession of the property for a period exceeding one year shall be deemed to be under a tenancy from month to month. Support is lent to this view by a decision of the Supreme Court in Burmah Shell Oil distributing now known as Bharat Petroleum Corporation Ltd. Vs. Khaja Midhat noor and others, AIR 1988 SC 1470 and Punjab National Bank Vs. Ganga narain Kapur, AIR 1994 All. 221 , wherein it has been held that a fixed term lese for a period exceeding on a year-oral or in writing, if not registered will be deemed to be a tenancy from month to month terminable by 15 days notice. Thus, the lease dated 1/02/1980 cannot ensure as a fixed term lease for five years and would be deemed to be one from month to month". ( 13 ) AS is obvious from the aforesaid quotation, this Court followed the judgment of supreme Court in the case of Burmah Shell Oil Distributing now known as Bharat Petroleum corporation Ltd. Vs. Khaja Midhat Noor and Others AIR 1988 SC 1470 . ( 14 ) THIS stand of the defendant on the basis of oral agreement cannot be looked into. Khaja Midhat Noor and Others AIR 1988 SC 1470 . ( 14 ) THIS stand of the defendant on the basis of oral agreement cannot be looked into. In such a case, how the tenancy is to be created is clearly provided under the Act and Section 106 readwith section 116 would govern the field and the tenancy would be required by these statutory provisions. It will also be pertinent to mention that in para 2 of the plaint the plaintiff has made a specific averment that the tenancy in question as monthly tenancy which used to commence on 15th of each calendar month and ending by 14th of the next following month. This averment is not specifically denied by the defendant in the written statement. The defendant is therefore not entitled to claim rent till the premises is relet to other tenant. ( 15 ) THESE issues are accordingly decided in favour of the plaintiff and against the defendant holding that the tenancy in question was month to month tenancy which could be terminated in accordance with provisions of Section 106 of the Act. ISSUE No. 3. Whether the plaintiff had offered to surrender the actual vacant possession of the premises on 14-2-97? If so, to what effect? ISSUE No. 4. When was the possession actually surrendered/taken possession of by the defendant? ( 16 ) BOTH the issues are interconnected, and therefore, taken up together for discussion. The correspondence exchanged between the parties relating to termination and surrender of the premises is virtually admitted by the parties. By notice dated 18/01/1997 (Exp- 1) the plaintiff had terminated the tenancy The defendant had given reply to this notice vide communication dated 6/02/1997 which is Ex. P-2. By another communication dated 14/04/1997 (Ex. P-3) the plaintiff had stated that the defendant not taken the possession or refunded the security as well as unadjusted amount of rent. This notice was replied to by communication dated 26/04/1997 (Ex. P-4) by the defendant. These issues can be determined on the reading of the contents of the aforesaid four notices and replies readwith the oral testimony of the parties. ( 17 ) AS mentioned above, by notice dated 18/01/1997 is a notice by which the tenancy in question is terminated by the tenant i. e. the plaintiff. P-4) by the defendant. These issues can be determined on the reading of the contents of the aforesaid four notices and replies readwith the oral testimony of the parties. ( 17 ) AS mentioned above, by notice dated 18/01/1997 is a notice by which the tenancy in question is terminated by the tenant i. e. the plaintiff. The portion of this notice, relevant for our purposes, is extracted below: "our said client is not desirous to continue the tenancy any more. In this regard, there were number of meetings and discussions with your husband Shri Rajeev khanna and father Shri Y. P. Malhotra. Please take notice on behalf of our said client that the tenancy of the aforesaid space is terminated on the expiry of 14th of february, 1997 or on the expiry of any other date in the same month which you think is the date of expiry of the tenancy. You are hereby required to take possession of the aforesaid premises on the expiry of 14th of February, 1997 i. e. 15/02/1997 from our said client and pay the security amount and also unadjusted advanced money to our client at the same time. Please note that in case you fail to take possession of the aforesaid flat on 1 5/02/1997, our said client would not be liable to pay any rent and you will be further liable to pay the interest on the security amount as well as on the unadjusted amount at the rate of 24% per annum and further in that event our client shall be constrained to file a suit for the recovery of the security amount as well as unadjusted amount at your risks as to costs etc. " ( 18 ) THUS by this notice the plaintiff not only terminated the tenancy but in no uncertain terms called upon the defendant to take possession of the tenanted premises on 1 5/02/1997. It was also very clearly stated that in case the defendant fails to take possession on the said date, the plaintiff would not be liable to pay any rent thereafter. In reply dated 6/02/1997 the defendant stated that the plaintiff was in financial difficulties and arrears from October, 1996 had become due and called upon the plaintiff to clear the arrears. In reply dated 6/02/1997 the defendant stated that the plaintiff was in financial difficulties and arrears from October, 1996 had become due and called upon the plaintiff to clear the arrears. It was further stated that the plaintiff had no right to surrender the possession of the premises till three years have lapsed from the commencing of the tenancy. In these circumstances, the defendant through her counsel, further mentioned that in the event the plaintiff surrenders the vacant possession, the defendant would try to let out the same to another tenant and till such time another tenant is found, the liability to pay rentals at agreed rate would continue. The defendant also stated that in case the plaintiff agreed to the same which offer was made without prejudice to the defendant s contention, the plaintiff should communicate directly with the defendant. ( 19 ) AFTER the reply of this notice, what happens on 15/02/1997 is not reflected in any communication immediately thereafter by either parties. Both the parties have maintained silence for almost two months. However, it is the plaintiff who initiates dialogue by sending notice dated. 14/04/1997 to the defendant wherein the plaintiff refers to its earlier notice dated 18/01/1997 and states that despite this notice the defendant had neither taken the possession nor refunded the security as well as unadjusted advance amount to the plaintiff. It was also stated that flat was lying vacant since 15/02/1997 at the defendant s risk and the plaintiff was not liable to pay any rent w. e. f. 15/02/1997. Interest at the rate of 24 per cent per annum w. e. f. 15/02/1997 was also demanded on the security as well as unadjusted amount. This was replied to vide communication dated 26/04/1997 refuting the averments made in notice dated 14/04/1997 and stating that the plaintiff had not surrendered the possession of the premises and continued to remain in possession. The defendant again reiterated the position that the plaintiff had no right to surrender the tenanted premises before the expiry of three years and also that the plaintiff was in arrears of rent from October, 1996. ( 20 ) FROM the aforesaid notices exchanged between the parties, the admitted position which emerges is that the plaintiff terminated the tenancy and called upon the defendant to take the possession on 15/02/1997. ( 20 ) FROM the aforesaid notices exchanged between the parties, the admitted position which emerges is that the plaintiff terminated the tenancy and called upon the defendant to take the possession on 15/02/1997. The plea of the defendant that tenancy could not be terminated before the expiry of three years has already been negatived while deciding Issue no. 2. It was, therefore, permissible for the plaintiff to terminate the tenancy/offer possession thereof to the defendant on 15/02/1997. In fact the defendant herself agrees that the plaintiff was in financial difficulties. No doubt there is a dispute as to what actually happened on 15/02/1997. According to Mr. S. K. Shukia, PW-1, he made a telephonic call and requested the defendant to take possession of the premises on 15/02/1997 at 11. 30am and at the premises on 11. 20am, waited for one hour but the defendant did not turn up to take the possession. This is denied by the defendant and the defendant s witness specifically stated that no such call was received by him for taking possession. The defendant s counsel further argued that there was no mention in any of the pleadings by the plaintiff about the telephonic call on 14/02/1997 or calling upon the defendant to take the possession. Thus as far as handing over possession on 15/02/1997 is concerned, it is an oral statement of either parties. As already pointed out above, immediately after 15/02/1997 neither the plaintiff wrote the defendant that the defendant did not allegedly come to take possession on that date nor the defendant wrote to the plaintiff that the plaintiff had not handed over the possession although offered the same in notice dated 18/01/1997. Therefore, it is a case where one has to draw the inferences from the conduct of the parties. Inference which could be drawn from the circumstantial evidence and conduct of the parties would be that the plaintiff had offered the possession and it is the defendant who refused to accept the same. Following circumstances would lend support to these inferences/findings: A) It is the plaintiff who had terminated the tenancy by notice dated 18/01/1997 w. e. f. the close of 14/02/1997 and offered the possession to the defendant on 15/02/1997 in that notice. B) The defendant s reaction was that the plaintiff could not terminate the tenancy and give possession before the expiry of three years. B) The defendant s reaction was that the plaintiff could not terminate the tenancy and give possession before the expiry of three years. Therefore, the unwilling party to take the possession could be defendant and not the plaintiff. C) The witness of the plaintiff (PW-l) has specifically stated in his examination-in- chief that on 14/02/1997 the plaintiff had removed all their belongings from the suit premises and did not utilise the premises thereafter. There is no cross- examination by the defendant on this aspect. If the plaintiff had removed the belongings on 14/02/1997 and the premises was not utilised by it thereafter, the plaintiff could not gain any advantage in retaining the premises. On the other hand, by not taking the possession the defendant could make her claim for rent against the plaintiff which has in fact been done. Therefore, it is the defendant who could be the gainer in not taking the possession. The defendant had taken a specific stand that she will try to find out the alternate tenant and till that is done liability to pay the rent would be that of the plaintiff. It is, therefore, possible that for want for alternate arrangement, the defendant was not willing to take possession. D) The defendant s own case is that the plaintiff was facing financial crunch. In such a situation the plaintiff could not have taken the risk of not handing over the possession and that too after terminating the tenancy. As already pointed out above may be, because of this reason the plaintiff wanted to vacate the premises as it was not in a position to pay the rent of Rs. 1,65,000. 00 per month. It, therefore, terminated the tenancy and offered to vacate the premises so that not only further rental liability ceases to accrue but the plaintiff is also able to recover the security deposit as well as unadjusted rent which was more than Rs. 11 lacs. E) Although nobody wrote to each other immediately after 15/02/1997, facts remains that it is the plaintiff who took first step by writing letter dated 14/02/1997 and stating that the plaintiff was not taking possession. F) Thereafter, also it is the plaintiff who filed the present suit on 25/07/1997 and along with the suit moved an application seeking directions to the effect that the defendant should take possession of the premises and offered keys along therewith. F) Thereafter, also it is the plaintiff who filed the present suit on 25/07/1997 and along with the suit moved an application seeking directions to the effect that the defendant should take possession of the premises and offered keys along therewith. These keys were in fact deposited with the court at the time of suit itself. ( 21 ) ALL these circumstances taken, in consideration cumulatively, amply lend support to the version of the plaintiff. ( 22 ) LEARNED counsel for the defendant relied upon various judgments of Apex Court as well as different High Courts to contend that such an offer given by the plaintiff to hand over possession does not amount to surrendering the possession by the plaintiff or taking over of the possession of the tenanted premises by the defendant. It was also submitted that mere offer of surrender of possession did not amount to surrendering the tenancy. Till actual physical possession was delivered to the landlord, the tenant continued to be in possession. According to the learned counsel, surrender as contemplated under Section 111 (e) of the act means for immediate yield of the interest as a surrender in future is not warranted by law . Learned counsel relied upon the judgment of the Apex Court in the case of Pandit kishan Lal Vs. Ganpat Ram Khosla and Anr. reported in AIR 1961 SC 1554 and particular emphasis was laid on paras 6 and 7 thereof as per which a tenant does not absolve himself from the obligation of his tenancy by intimating that as from a particular date he will cease to be in occupation under the landlord. . . . . Further it was held that it is one of the obligations of a contract of tenancy that a tenant will, on termination of tenancy, put the landlord in property demised. It was also held that the true position was, therefore, that the company did not immediately on service of notice ceased to be tenant. ( 23 ) THE learned counsel relied upon the judgment in the case of 1987 (1) JT 365 wherein the sub-lease was created by the lessee of part of the property let out by the landlord to the original lessee. It was held that Section 111 (e) contemplates as surrender of the entire interests under the lease and not a part of the interest alone. It was held that Section 111 (e) contemplates as surrender of the entire interests under the lease and not a part of the interest alone. Moreover a lease can be determined only by restoring possession in respect of the entire property which was taken on lease. ( 24 ) SUSTENANCE was also sought to be drawn from the judgment of the Apex Court in the case of W. H. King Vs. Republic of India and Anr. reported in AIR 1952 SC 156 . It was a case where the Apex Court laid distinction between assignment on the one hand and relinquishement on the other. It was held that in the case of relinquishement it cannot be unilateral transaction; it can only be in favour of the lessor by mutual agreement between them. The relinquishement of possession must be to the lessor or one who holds his interests. In fact a surrender or relinquishement terminates the rights of the lessee. ( 25 ) HE also relied upon various judgments of the High Courts which are as under: 1. K. Sreenivasa Rao and Anr. Vs. K. M. Narasimhiah and Anr. reported in AIR 1972 Mysore 90. It was held that mere fact of surrender of possession, the tenants did not surrender their tenancy. It was also held that till actual physical possession delivered to the landlord, the tenant continues to be in possession thereof. 2. M. S. Ram Singh Vs. Bijoy Singh Surana and Anr. reported in AIR 1972 calcutta 190. It was a case where the tenant, had stated that he would be surrendering the tenanted premises. Interpreting this Section 111 (e) of Transfer of property Act. It was held in para 9 that surrender is the yielding up by the lessee of his interests to the lessor. It was also held that surrender as contemplated under section 111 (e) means for immediate yield of the interest as a surrender in future is not warranted by law. The actual physical surrender never took place as, the plaintiff kept the keys with it and deposited in the court. 3. Venkita Pathi Naidu Vs. Sethu Udaya and Ors. reported in AIR 1974 Kerala 132. The actual physical surrender never took place as, the plaintiff kept the keys with it and deposited in the court. 3. Venkita Pathi Naidu Vs. Sethu Udaya and Ors. reported in AIR 1974 Kerala 132. It was a case where the defendant had taken a plea that the match faculty, where the business was being carried on, got burnt in February, 1958 and alleged that on 17/05/1958, he went to the factory premises and entrusted to the plaintiff the entire machinery belonging to him under a lease and the plaintiff said to have taken over the premises in his possession on that date. He further pleaded that the plaintiff allowed the second defendant to remove the machinery entrusted with the plaintiff and the suit itself was filed in collusion with the second defendant. This plea was not accepted by the court that the defendant had surrendered the possession of the premises to the plaintiff on 17/05/1998. The suit of the plaintiff was decreed. In appeal, it was held that the plaintiff was right in saying that abandonment by the defendant of his possession will not amount to surrender. The abandonment must be accompanied by the acceptance of possession by the landlord. ( 26 ) HE also relied upon: 1) 1915 P. C. 96, 2 ). Jatinder Kumar Vs. Harmohinder Singh and ors. reported in AIR 1994 Punjab and Haryyana 60. 3) Tarabai Jivanlal Parekh Vs. Lala padamch and reported in AIR 1950 Bombay 89. 4. Puttegowda Vs. State of Karnataka and ors. reported in AIR 1980 Karnataka 102. 5. Ramayan Prasad Vs. Mt. Gulabo Juer and anr. reported in AIR 1967 Patna 35. 6. Balasubramania Iyer Vs. Subbiah Thevar and Anr. reported in AIR 1965 Madras 417 laying down the same proposition of law. ( 27 ) HIS submission was that mere offer to surrender the possession is of no consequence unless actual physical possession is delivered to the landlord. There is no dispute about this proposition in law. However, in the instant case, the findings recorded on the basis of evidence, the plaintiff had sought to deliver the possession and offered the same to the defendant and it is the defendant who avoided to take the possession. In this view of the matter, I am afraid that none of these judgments apply to the facts situation of the present case. In this view of the matter, I am afraid that none of these judgments apply to the facts situation of the present case. This court, on the basis of material and evidence on record, has believed the version of the plaintiff and recorded the finding to the effect that although the plaintiff had taken appropriate steps by offering the possession of the premises to the defendant, it is the defendant who did not take possession. In fact in the very first reply dated 6/02/1997 to the plaintiff s notice dated 18/01/1997 the defendant had put conditions for taking possession. The plaintiff, therefore, discharged its obligation under law as contemplated by Section 111 (e) of the Act. If the defendant avoided to take the possession, the defendant cannot be permitted to take advantage of her own wrong. (Refer: Raja Laxman Singh Vs. State of Rajasthan reported in AIR 1988 Rajasthan 44) ( 28 ) IT is trite that when the lease is terminated by notice and the possession is offered, the landlord cannot refuse to take the possession. If the landlord refuses to take the possession, the lease would not continue. Therefore, even if the contention of the defendant herein was that the tenancy was for a period three years, she could take possession and thereafter sue the plaintiff for rent. She did not do so. She took calculate risk by challenging the action of the plaintiff in terminating the tenancy and avoided to take possession. ( 29 ) ISSUES No. 3 and 4 are therefore decided in favour of the plaintiff and against the defendant. It is held that the plaintiff had offered to surrender the actual vacant possession of the premises and it is the defendant who did not take the possession thereof on 1 5/02/1997 although offered by the plaintiff. Therefore, the valid surrender of the tenanted premises took place on 15/02/1997. It would be deemed that the defendant took possession thereof on 15/02/1997 even when the actual possession was taken on 13/09/1997 when the keys of the tenanted premises were taken by the defendant which was deposited by the plaintiff while filing the suit. ISSUE No. 6. To what amount, if any, is the plaintiff entitled to? ISSUE No. 7. Whether the defendant is entitled to sum claimed by her in the Counter claim? ISSUE No. 6. To what amount, if any, is the plaintiff entitled to? ISSUE No. 7. Whether the defendant is entitled to sum claimed by her in the Counter claim? ( 30 ) THE result of the discussion on the issues already discussed and decided above, is that the plaintiff is not liable to pay any rent after 15/02/1997. Therefore, the defendant is not entitled to any amount claimed by her in the counter-claims. Issue No. 7 is accordingly decided against the defendant and in favour of the plaintiff. In so far as the plaintiff is concerned, it would become entitled to the refund of the security deposit as well as unadjusted advance i. e. a sum of Rs. 9,93,600. 00 + Rs. 1,09,065. 00. In answer to Issue No. 6, it is held that the plaintiff is entitled to Rs. 11,02,665. 00. ISSUE No. 5. Whether the plaintiff is entitled to interest? If so, at what rate and for what period? ( 31 ) ADMITTEDLY, the amount deposited by the plaintiff with the defendant was not to carry any interest and it was interest free. It is also an admitted case that the advance rent was adjustable in 36 months. Therefore, it was a bonafide belief nurtured by the defendant that the defendant would not have to pay any amount against the advance rent which would be adjusted over a period of three months and further that the security amount would no. refunded before the expiry of three years and that the defendant could utilise the amount without interest for this period. In fact it is only in the absence of any lease agreement in writing and registration thereof that the conclusion arrived at is that the tenancy was month to month and therefore was determinable by notice as required under Section 106 of the Act. However, when it comes to payment of interest, since the amount deposited was interest free which could have been in normal course given only after the expiry of three years, the justice would demand that no interest is payable till 14/08/1998. The defendant has however not returned the money even after 14/08/1998. Therefore, the plaintiff would be entitled to interest on this amount w. e. f. 15/08/1998 as interest was specifically demanded by legal notice much earlier. The defendant has however not returned the money even after 14/08/1998. Therefore, the plaintiff would be entitled to interest on this amount w. e. f. 15/08/1998 as interest was specifically demanded by legal notice much earlier. However, keeping in view the nature of transaction which was not a business transaction and also keeping in view the prevailing rate of interest, at present, it would be reasonable to award interest at the rate of 9 per cent per annum. The plaintiff is therefore held entitled to interest at the rate of 9 per cent per annum on the suit amount w. e. f. 15/08/1998 till payment thereof. This issue is accordingly decided in favour of the plaintiff and against the defendant. ISSUE No. 9. Whether the Counter claim has not been valued properly for purposes of court Fee? ( 32 ) THE plaintiff has not stated as to how the counter-claims are not properly valued. No arguments were also advanced on this issue. This issue is accordingly decided against the plaintiff and in favour of the defendant. ( 33 ) IN view of the findings recorded on the aforesaid Issues, this suit is decreed in favour of the plaintiff in the sum of Rs. 11, 53,921. 00 along with interest at the rate of 9 per cent per annum w. e. f. 15/08/1998 till payment thereof. The plaintiff shall also be entitled to cost. The counter-claims of the defendant in Counter Claim No. 1876/97 are dismissed. Decree be drawn accordingly. Suit stands disposed of.