Well persons to stay usually mean occupiers. If 8 persons are staying on a premises which is rented out to 5 persons you appear to be in breach of your lease. He could either terminate your contract or renegotiate the term. He had chosen the latter. I cannot on the quantum of increase as I do not know in which neighbourhood are you residing. If you cannot he could terminate your lease. He could not legal forfeit a lease but it is the usual practice to defray his losses.