Difference between leave licence and lease
Struggling Landlord
(Querist) 28 March 2012
This query is : Resolved
Since I am one of the old landlord who has suffered a loss due to Indian time lagging judiciary system, and owns 30000 sq ft built up area rented to various tenants in 1964 who r paying rent at Rs 1 to 2 per sq ft per month, where as rent in vicinity is at 70-80 rs per sq ft per month. After long letigations (14 yrs) I have vacated 10000 sq ft area on FF,which I have kept vacant since last 3 years due to phobia, and in coming days I may get 1 shop block vacated, Now due to my old experience I am very much avoiding to give on rent, But some one suggested me to have Leave and License which is much safer than Lease, So through this forum I wanted some light on Leave and License, (So can I be safe..) What precautions I have to take while drafting Leave and License Agreement, I my region Maharashtra Rent Control Act 1999 is in force. Pl guide
Deepak Nair
(Expert) 28 March 2012
By Leave and license, the landlord gives license to use his premises for certain period of time without any tenancy right.
This is the safest way to give the premises on rent.
V R SHROFF
(Expert) 28 March 2012
LL is safer, must Register it
Adv.R.P.Chugh
(Expert) 28 March 2012
Dear Struggling Landlord,
I am not aware of specific nuances of Maharashtra Rent Control Act, but I am sure there is a provision as regards 'limited period tenancy' for which permission is to be taken by the controller by citing reasons for giving premises for a limited period - after which tenant's occupation becomes illegal and can be ousted straight-away without resort to limited grounds of relief.
As regards Leave and License Agreement (Registered or Not) let me tell you - WHether you name it to be a leave or license or a lease deed, you get rent or license fees, it does not matter what you name it - the court would still have the last word, if the court feels that you have called a lease a leave and license to circumvent the rent control laws - then it might take it accordingly. When you transfer exclusive possession to a man you call your licensee automatic presumption as raised by courts is that he is a lessee - you would have to justify that he is not a lessee but a licensee.
In a nutshell - I would advise you to first contemplate the limited period tenancy as advised - if the same is not being done in your area - go in for L & L.
N.K.Assumi
(Expert) 28 March 2012
The cardinal principles between a lease and a license is that in a lease there is a transfer of interest in the premises, whereas in the case of a license there is no transfer of interest, although the licensee acquires a right to occupy the premises.
Guest
(Expert) 31 March 2012
I endorse views of Shri Shroff.
