What is a leave and licence agreement?

A leave and licence agreement is a legal document that enables a landlord to allow a tenant to use their property for a specific period without any change in its ownership. Leave and licence agreements are commonly used in the rental housing segment. In the commercial realty segment, however, the use of lease agreements is more common.

This is because a lease creates an exclusive interest in the property in favour of the tenant while a leave and licence agreement does not create any interest in the property towards the tenant.

Lease versus leave & licence agreement

• A lease creates an interest in the property unlike a leave and license agreement.
• A lease grants a tenant with exclusive possession while a leave and licence agreement only grants permission to occupy the property.
• Licences are revocable; leases are not.
• Leases are not determined by the grantor while licences are.
• Leases are transferable while licences are not.
• A lease creates inheritable rights unlike licences.

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Leave and licence agreement: Legal definition

While various courts have from time to time elaborated on the legal concept, the basis of the leave and licence agreement is found in the Indian Easements Act, 1882.

“Where one person grants to another, or to a definite number of other persons, a right to do, or continue to do, in or upon the immovable property of the grantor, something which would, in the absence of such right, be unlawful and such right does not amount to an easement or an interest in the property, the right is called a license,” reads Section 52 of the Indian Easements Act.

According to the Supreme Court (SC), if a document gives only a right to use the property in a particular way or under certain terms, while it remains in the possession and control of the owner thereof, it will be a license. Basically, no interest in the property is transferred to the tenant.

“The legal possession, thereof, continues to be with the owner of the property but the licensee is permitted to make use of the premises for a particular purpose. But for this permission, his occupation would be unlawful. It does not create in his favour any estate or interest in the property,” the SC said.

Since no easement right is granted, the landlord can revoke the permission granted to the tenant at will. In cases where the landlord wants to let out his property for short periods, working out a rental agreement format on the basis of a leave and licence agreement, gives them the freedom to do so. This is also beneficial for the tenant, as they do not have to serve long notice periods to vacate the place.

Also Read: Section 80EEA: Tax deduction for repayment of home loans

Details in leave and licence agreement

Plot Number
Khata Number
CTS Number
Milkat Number
Building Name/Building Number/Floor Number
Parking Area and Parking Area Unit
Gallery Area and Gallery Area Unit
Street or Locality
Taluka
City
Pin Code
State
Property type
Location
Refundable Deposit
Non-Refundable Deposit
Type of rent
Party that has paid the Stamp and Registration Fees
Date from the calendar from which the agreement is applicable
The date at which the agreement terminates
Monthly Rent
Party Type: Licensor or Licensee
Party Category
Party’s First, Middle, and Last Name
Gender
Age
PAN Number
Occupation
E-mail ID
Mobile number
ID proof, etc.

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Leave and licence agreement sample format

LEAVE AND LICENSE AGREEMENT

This agreement is made and executed on (Date) at (City) Between, (Name) , Age: About Years, Occupation: , PAN: , UID: . Residing at: HEREINAFTER called ‘the Licensor (which expression shall mean and include the Licensor above named as also his respective heirs, successors, assigns, executors and administrators)

AND (Name) , Age: About Years, Occupation: ___ , PAN:_________, UID:________ . Residing at ___________________________________________________________________ HEREINAFTER called ‘the Licensee’ (which expression shall mean and include only Licensee above named).

WHEREAS the Licensor is absolutely seized and possessed of and or otherwise well and sufficiently entitled to all that constructed portion being unit described in Schedule hereunder written and are hereafter for the sake of brevity called or referred to as Licensed Premises and is/are desirous of giving the said premises on Leave and License basis under Section 24 of the Maharashtra Rent Control Act, 1999.

AND WHEREAS the Licensee herein is in need of temporary premises for his use has/have approached the Licensor with a request to allow the Licensee herein to use and occupy the said premises on Leave and License basis for a period of Months commencing from and ending on , on terms and subject to conditions hereafter appearing.

AND WHEREAS the Licensor have agreed to allow the Licensee herein to use and occupy the said Licensed premises for his aforesaid purposes only, on Leave and License basis for above mentioned period, on terms and subject to conditions hereafter appearing;

NOW THEREFORE IT IS HEREBY AGREED TO, DECLARED AND RECORDED BY AND BETWEEN THE PARTIES HERETO AS FOLLOWS:-

1) Period: That the Licensor hereby grants to the Licensee herein a revocable leave and license, to occupy the Licensed Premises, described in Schedule hereunder written without creating any tenancy rights or any other rights, title and interest in favour of the Licensee for a period of Months commencing from and ending on

2) Rent & Deposit: That the Licensee shall pay to the Licensor Rs. Per month towards the compensation and Rs. Interest free refundable deposit, for the use of the said licensed premises. The amount of monthly compensation shall be payable within first five days of the concerned month of Leave and License.

Or

That the Licensees shall pay to the Licensor the following amount per month towards the compensation for the use of the said licensed premises . a) Rs —————-per month for the first ——–months, b) Rs—————–per month for the next ——–months, c) Rs—————–per month for the next ——–months The amount of monthly compensation shall be payable within first five days of the concerned month of Leave and License. OR · That the Licensees shall pay to the Licensor Rs————–per month towards the compensation and Rs————–interest free refundable deposit, for the use of the said licensed premises. The amount of monthly compensation shall be payable within first five days of the concerned month of Leave and License.

OR

That the Licensees shall pay to the Licensor Rs————–per month towards the compensation and Rs————–interest free nonrefundable deposit, for the use of the said licensed premises. The amount of monthly compensation shall be payable within first five days of the concerned month of Leave and License.

OR

That the Licensees shall pay to the Licensor the following amount per month towards the compensation for the use of the said licensed premises . a) Rs —————-per month for the first ——–months, b) Rs—————–per month for the next ——–months, c) Rs—————–per month for the next ——–months. The amount of monthly compensation shall be payable within first five days of the concerned month of Leave and License. Licensees shall also pay to the Licensor Rs————–interest free refundable deposit, for the use of the said licensed premises.

OR

That the Licensees shall pay to the Licensor the following amount per month towards the compensation for the use of the said licensed premises. a) Rs —————-per month for the first ——–months, b) Rs—————–per month for the next ——–months, c) Rs—————–per month for the next ——–months. The amount of monthly compensation shall be payable within first five days of the concerned month of Leave and License. Licensees shall also pay to the Licensor Rs————–interest free nonrefundable deposit, for the use of the said licensed premises.

3) Payment of Deposit:

That the Licensee have paid / shall pay the above mentioned deposit/premium as mentioned above by Cash. Amount Rs.________

OR

That the ———————- has/have paid / shall pay the above mentioned deposit/premium as mentioned above by Demand Draft No.———-, dated ——–, drawn from —————- Bank, ————- Branch. Amount Rs.————-

OR

That the ———————- has/have paid / shall pay the above mentioned deposit/premium as mentioned above by Cheque No. ———–, dated——–, drawn on the Licensee’s Banking Account with —————- Bank, ————- Branch. Amount Rs.————-

OR

That the ———————- has/have paid / shall pay the above mentioned deposit/premium as mentioned above by Transaction Reference No. ————-, dated———-, drawn on the Licensee’s Banking Account with ————— Bank, ———– Branch. Amount Rs.———–

4) Maintenance Charges:

That the all outgoings including all rates, taxes, levies, assessment, maintenance charges, non occupancy charges, etc. in respect of the said premises shall be paid by the Licensor.

OR

That the Licensee/s herein shall bear and pay all the maintenance charges in respect of the said Licensed Premises, and other outgoings including all rates, taxes, levies, assessment, non occupancy charges, etc. in respect of the said premises shall be paid by the Licensor/s

5) Use: That the Licensed premises shall only be used by the Licensee for purpose. The Licensee shall maintain the said premises in its existing condition and damage, if any, caused to the said premises, the same shall be repaired by the Licensee at its own cost subject to normal wear and tear. The Licensee shall not do anything in the said premises which is or is likely to cause a nuisance to the other occupants of the said building or to the prejudice in any manner to The rights of Licensor in respect of said premises or shall not do any unlawful activities prohibited By State or Central Government.

6) Alteration: That the Licensee shall not make or permit to do any alteration or addition to the construction or arrangements (internal or external) to the Licensed premises without previous consent in writing from the Licensor.

7) No Tenancy: That the Licensee shall not claim any tenancy right and shall not have any right to transfer, assign, and sublet or grant any license or sub-license in respect of the Licensed Premises or any part thereof and also shall not mortgage or raise any loan against the said premises.

8) Inspection: That, the Licensor shall on reasonable notice given by the Licensor to the Licensee shall have a right of access either by himself or through authorized representative to enter, view and inspect the Licensed premises at reasonable intervals.

9) Cancellation: That, if the Licensee commits default in regular and punctual payments of monthly compensation as herein before mentioned or commit/s breach of any of the terms, covenants and conditions of this agreement or if any legislation prohibiting the Leave and License is imposed, the Licensor shall be entitled to revoke and / or cancel the License hereby granted, by giving notice in writing of one month and the Licensee too will have the right to vacate the said premises by giving a notice in writing of one month to the Licensor as mentioned earlier.

10) Possession: That the immediately at on the expiration or termination or cancellation of this agreement the Licensee shall vacate the said premises without delay with all his goods and belongings. In the event of the Licensee failing and / or neglecting to remove himself and / or his articles from the said premises on expiry or sooner determination of this Agreement, the Licensor shall be entitled to recover damages at the rate of double the daily amount of compensation per day and or alternatively the Licensor shall be entitled to remove the Licensee and his belongings from the Licensed premises, without recourse to the Court of Law.

11) Registration: This Agreement is to be registered and the expenditure of Stamp duty and registration fees and incidental charges, if any, shall be borne by the Licensee.

 Schedule:

(Description of flat which is the subject matter of these presents) All that constructed portion being residential unit bearing___( Apartment/Flat No.) ____, Built-up (Area): ___________, situated on the Floor of a Building known as ______________ standing on the plot of land bearing ___________________________________________________ , of Village: , situated within the revenue limits of Tehsil and Dist and situated within the limits of Municipal Corporation.

IN WITNESS WHEREOF the parties hereto have set and subscribed their respective signatures by way of putting thumb impression electronic signature hereto in the presence of witness, who are identifying the executants, on the day, month and year first above written.

Licensee                                                                      

Name

Address

Photo

Thumb impression

Licensor

Name

Address

Photo

Thumb impression

Witness of execution -cum- identifier for

Name

Address

Photo

Thumb impression

Witness of execution -cum- identifier for

Name

Address

Photo

Thumb impression

Leave and licence agreement format 2

This rent agreement is made on this __________ (date) by ________________ (name of the landlord) S/o _______________ (father’s name of the landlord), Address: ___________________________________________________ (residential address of the landlord). Hereinafter called the Lessor/Owner, and first party

AND

_____________________________ (Name of tenant), called lessee/tenant, or second party

The expression Lessor/Owner and the Lessee/Tenant shall mean and include their legal heirs successors, assigns, representatives etc.

Whereas the first party is the owner and in possession of the property No: _______________________________________________________________________________________________ (address of rented property) and has agreed to let out the said property to the second party for a monthly rent of Rs. ______/- (in words) per month.

Now This Rent Agreement Witness As Under:

That the second party will have to pay Rs. ______/- (in words) as monthly rent, which does not include electricity and water charges.

That the second party shall pay one month rent in advance to the landlord that would be further adjusted in the monthly rent.

That the second party shall pay the water and electricity charges on the basis of the consumption to the landlord/owner.

That the second party shall not lease the property to a subtenant under any circumstances without the consent of the owner/landlord.

That the second party shall follow all the rules and regulations, by-laws set by the local authorities in respect of the leased property and will not get involved or do illegal activities in the leased property.

That this rent agreement is granted for a period of eleven (11) months starting from ___________, and this contract can be extended further with the mutual consent of both the parties.

That the second party shall not be permitted to do a construction in the rented premises. Besides, he/she could do the installation of temporary decoration, wooden partition/cabin, air conditioners etc. without seeking the permission of the landlord.

That the second party is not allowed to make any alteration in the rented property without the written consent of the owner.

That the second party will have to allow the landlord or his authorized agent to enter in to rented premises for its inspection or general checking for any repair work, if needed.

That the second party shall keep the premises clean.

That the second party shall bear the cost of day to day minor repairs.

That this contract/agreement could be revoked before the expiry of this tenancy period by serving one month prior notice.

That both the parties have read and understood this agreement and have agreed to sign the same without any pressure from any side.

In WITNESS WHEREOF

The landlord and the tenant have hereunto subscribed their hand at ______ (place) on this the _____________ (date of rent agreement) year first above mentioned in presence of the following witnesses.

Witnesses:

1.___________ (name of the landlord)

2._________________ (name of the tenant)

Lessor                                                                                   Lessee

Leave and licence agreement sample Hindi

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इकरारनामा बाबत किराया / किरायानामा

वार्षिक किराया                                                                         रूपये

स्टाम्प                                                                                     रूपये

स्टाम्प क्रमांक दिनांक

स्टाम्प की संख्या

किरायानामा आज दिनांक को ——————- श्री / श्रीमती| (प्रथम पक्ष / मालिक)——————————- पुत्र / पुत्री / धर्मपत्नी / विधवा———————– आयु                वर्ष——————– निवासी—————— तहसील———————— जिला———————- राज्य ———————– | (प्रथम पक्ष / मालिक )

श्री / श्रीमती——————– पुत्र/पुत्री / धर्मपत्नी / विधवा——————-  आयु                वर्ष——————– निवासी—————— तहसील———————— जिला———————- राज्य ———————– |  (द्वितीय पक्ष / किरायेदार ) के बीच निष्पादित किया गया है / लिखा गया है।

जो कि प्रथम पक्ष अनुसूची में दर्शाया गया है, एक मकान / प्लाट / फलट / दुकान //उद्योगिक प्लाट /जिसका प्रथम पक्ष मालिक व काबिज है। जिस पर किसी प्रकार का कोई भार नहीं है । अनुसूची मे दर्शाई गई अचल संपति पर किसी प्रकार का कोई कर्जा, किसी बैंक या सरका

अथवा गैर सरकारी संस्था से प्राप्त नही किया हुआ । संबंधित अचल संपति किसी नीलामी व कुर्की आदि मे शामिल नही है । संबंधित अचल संपति को आज से पहले किसी प्रकार से रहन-बैय-हिब्बा व अन्य तरीके पर हस्तान्तरित नही किया गया है | अचल संपति को किराये पर देने की बावत किसी प्रकार की कोई रूकावट किसी विभाग या किसी न्यायालय की नहीं है । उक्त अचल संपति पर प्रथम पक्ष का कब्जा दिनांक ——— से बतौर किरायेदार    राशि———- रू० प्रति मास पर बतौर किराये के रूप मे देनी स्वीकार की है | जिसकी बावत किरायानामा दिनांक ———- को किया गया है | जिसका किरायानामा निष्पादित करना प्रथम पक्ष व द्वितीय पक्ष उचित समझते है । इसलिए अब प्रथम पक्ष द्वितीय पक्ष उक्त किरायानामा दिनांक तक के लिये निष्पादित करते है कि प्रथम पक्ष ने अपनी ‘रू0 प्रति मास किराये पर द्वितीय पक्ष को निम्नलिखित शर्तो पर दी हैः-

1- यह है कि मौके पर कब्जा द्वितीय पक्ष का दिनांक ——— से दे दिया है और यह किरायाना

दिनांक ——————- तक की अवधि तक वैध रहेगा ।

2- किराया की इस अवधि के दौरान द्वितीय पक्ष किराये के रूप मे प्रथम पक्ष को —- ₹0  प्रति मास के हिसाब से हर मास की ………………..—- तिथि तक अग्रिम रूप मे प्रथम पक्ष को नगद प्रदान कर देगा ।

3- यह है कि उक्त अवधि के दौरान सरकारी लगान, पानी एवं बिजली का खर्च द्वितीय पक्ष स्वंय वहन करता रहेगा । जिसके बारे मे प्रथम पक्ष कोई आपत्ति उत्पन्न नही करेगा |

4- यह है कि उक्त अवधि समाप्त होने पर द्वितीय पक्ष, प्रथम पक्ष को वापिस कर देगा ।

5- यह है कि उक्त अवधि के दौरान भुगतान की रसीद प्रथम पक्ष द्वितीय पक्ष को देगा ।

6- यह है कि उक्त अवधि के दौरान प्रथम पक्ष व द्वितीय पक्ष के बीच कोई विवाद होता है तो पंच फैसला दोनो पक्षो को मान्य होगा |

7- यह है कि द्वितीय पक्ष ने जिणनण-े.. रूपये. (शब्दों  मे ———————— रुपये) केवल नगद प्रथम पक्ष को बतौर जमानत के रूप मे अदा कर दिये है जो कि बिना किसी ब्याज के प्रथम पक्ष द्वितीय पक्ष को सम्बन्धित अचल सम्पति के खाली करने के समय बकाया किराया व अन्य देनदारी आदि काट कर वापिस कर देगा ।

8- यह है कि उपरोक्त म्यांद के बाद यदि किरायेदारी की म्यांद बढ़ाई जाती है तो प्रत्येक मास—————- के बाद—————– प्रतिशत की दर से किराये मे वृद्धि होगी तथा किरायेदारी की म्यांद केवल प्रथम पक्ष की सहमति द्वारा ही बढ़ाई जा सकेगी |

9- यह है कि द्वितीय पक्ष सम्बन्धित अचल सम्पति को केवल———————– कार्य के लिए इस्तेमाल करेगा ।

10- यह है कि द्वितीय पक्ष सम्बन्धित अचल सम्पति पर या इसकी किसी भी निर्माण मे किसी भी किस्म की कोई तोडफोड या नया निर्माण नही करेगा तथा किसी अन्य व्यक्ति को किराये पर नही देगा तथा प्रथम पक्ष को हक होगा कि वह किसी भी समय निरीक्षण के लिए आ सकता है जिसका द्वितीय पक्ष को कोई आपत्ति नही होगी तथा द्वितीय पक्ष कोई ऐसा कार्य नही करेगा जो कि कानून की नजरों मे गलत होगा ।

11- यह है कि सम्बन्धित अचल सम्पति मे छोटी मुरम्मत जैसे कि बिजली की तारों मे परेशानी, पानी की लीकेज आदि द्वितीय पक्ष स्वंय करेगा |

12- यह है कि जब भी किसी पक्ष को उपरोक्त अचल सम्पति को खाली करना या कराना हो तो वह दूसरे पक्ष को दो महिने पहले नोटिस देगा| 

13- यह है कि उपरोक्त किराया नामा के दोनो पक्ष व उनके वारसान आदि हमेशा पाबन्द रहेगे तथा इसकी शर्तों का पालन करेगें ।

अत: यह किराया नामा लिख दिया है कि बतौर साक्षी प्रमाण रहे ताकि समय पर काम आये |

दिनांक———————–

 अनुसूचि ( पहचान के लिये अचल सम्पति का विवरण)

नक्शा सीमा व पैमाईश मकान /प्लाट,/फलेट / दुकान / फैक्टरी /उद्योगिक प्लाट के केस मे

पूर्व:- >> फुट…….. इंच… .पश्चिम:-                               ….. फूट……. इंच—–

उत्तर:- >> फुट…….. इंच… .पश्चिम:-                               ….. फूट……. इंच—–

स्थित ———————————-

साक्षीगण:           

हस्ताक्षर प्रथम पक्ष

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Landlord can ask tenant to vacate property for genuine needs: HC

As long as the landlord’s needs his rented premises for a genuine reason, he is free to ask the tenant to vacate his property, the Bombay High Court (HC) has ruled. While upholding an eviction decree, the HC said that landlords are the best judge of their residential requirements, and it is not up to the tenant to suggest that the former must “adjust” so that his tenancy can continue,

The dispute pertains to a 319-square-foot (sqft) property South Mumbai. On May 17, 2004, the owners and original plaintiffs issued a notice terminating the tenancy, instructing the tenant to vacate, asserting that the main tenant sublet the premises to without written consent. The landlords also said they occupied about 400 sqft along with 11 family members and required the suit premises.

“Apart from a bare denial of the statement that the premises are required by the landlord for their reasonable and bonafide use and the statement that the landlords have more than sufficient premises, there is absolutely no evidence on record to prove that the need of the Plaintiffs is not genuine or bonafide. The landlords have a large family consisting of more than 11 family members. Their children have grown up. These grown-up children should have enough space and privacy to devote their time to studies, without any disturbances,” the HC said while giving its verdict in the Ajay Mahasukhlal Shah versus Chandrakant Babulal Shah and Others case.

“The proven fact is that the need of the landlord for additional accommodation is genuine, honest and conceived in good faith and thus reasonable and bonafide. In such circumstances, challenge to the finding rendered by the courts below on the issue of bonafide and reasonable need of the premises cannot be countenanced for the simple reason that the landlord is the best judge of his residential requirement and the tenant cannot dictate terms to him as to how he can and how he should adjust in the available premises,” it added.

Section 16(1)(g) of the Maharashtra Rent Control Act, 1999, provides for eviction of tenant on the ground of reasonable and bonafide requirement of the landlord.

Also Read: Stamp duty in Ayodhya in 2024

No single litmus test to distinguish licence from lease: Kerala HC

July 24, 2023: There is no single litus test to differentiate between a lease and a licence agreement, the Kerala High Court has said. The intentions of the parties involved and the surrounding circumstances determine the nature of the arrangement and not the nomenclature used in the document and or reading of a few isolated provisions, it added.

“It is the settled law that the nature of a document has to be understood not by its nomenclature or by interpreting one or two clauses in it in isolation, but by interpreting the document as a whole. Going by the principles laid down by the aapex court as well as this court, there cannot be a single litmus test to decide whether the transaction is a lease or licence,” a Division Bench of Justice Anil K Narendran and Justice PG Ajithkumar said in an order dated July 14, 2023.

“Generally speaking, the difference between a lease and licence is to be determined by finding out the real intention of the parties as decipherable from a complete reading of the document, executed between the parties and the surrounding circumstances,” it added while setting aside an order by the rent control court in the Ashok Harry Pothen versus Premlal case.

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