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anand das (service)     12 October 2011

Business conducting/property matter

‘A’ owns a certain piece of land and there’s a structure (a 3 storied building) built by ‘A’ on this land. Building is newly built and is empty.  ‘A’ is approached by a multinational company ‘B’ to open it’s retail outlet in this premises (land with building).  

1.  Can ‘A’ give the premises by entering into a ‘Business Conducting Agreement”  without getting into ‘Lease ‘ or  ‘Leave and License agreement’ and also without ‘A’ himself participating in the business? Company ‘B’ will give money to use A’s premises as per ‘Business Conducting Agreement”.

2. Will this attract stamp duty as in the case of ‘Lease’ or ‘Leave & License’  agreements ?



Learning

 1 Replies

Hemant Agarwal (ha21@rediffmail.com Mumbai : 9820174108)     12 October 2011

1.  IF  "A" is giving out his own premises for Rent to a Business-person (without involving himself in the said business),  THEN  it will be compulsorily a  "Leave & License" agreement and not a Business Conducting agreement.  A Leave & License agreement will attract state stamp duty and registration fees.


2.  Business conducting agreement can be made with common consent of two different persons (Say  A & B) (where A may own the premises),  BUT here  "A" conducts business himself with the jointly with  "B",  with or without taking rent from B, as which may be defined in the Business Conducting agreement.
A Business Conducting agreement will attract state stamp duty and registration fees.


Keep Smiling .... Hemant Agarwal

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