Leave and License Agreement

What is Leave and License agreement?

A Leave and License is an agreement temporarily made by a licensor and a licensee which allows the licensee to use and occupy the licensor’s immovable property full or part of the same, for the purpose of carrying on business activity or residential use and pay a fixed amount of rent or as per their mutual understanding decided and accepted.



Essential elements of lease agreement

To make sure that there are no loopholes in your agreement that can leave you exposed, make sure that you DO NOT FORGET to include clauses that are mentioned below.
  1. License Fee
  2. Rent and Security Deposit
  3. Maintenance and other tax charges
  4. Tenure of the Agreement
  5. Duties and obligations of both the parties
  6. Consequences of non-payment of license fee, not returning the deposit etc
  7. Renewal option
  8. Termination rules
  9. Dispute Resolution
  10. Jurisdiction


How to make it enforceable and legally valid?

  1. Prepare the content of the deed.
  2. Obtain the E-stamp Certificate by paying the applicable stamp duty on the deed
  3. The licensor and the licensee must then place their signatures in the designated places
  4. Signature of two witnesses must also be placed at their designated places in the deed.


Difference between lease and Leave and License Agreement


Following are the common differences between a lease (commonly referred as rental agreement) and a Leave and License agreement.


  1. A lease creates an interest in property while the Leave and License agreement does not
  2. Lease grants a tenant with exclusive possession of an immovable property while the Leave &Licence agreement only provides a permission to occupy a certain property
  3. Leases are transferable but Licences are not
  4. Licences are revocable by the Licensor whereas leases are not revocable by the lessor
  5. Leases are not determined by the grantor, Licences are
  6. Lease creates heritable rights while Licences do not.

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