Law
pratibha
(Querist) 05 September 2011
This query is : Resolved
I want a complete explanation on leave and license agreement
A V Vishal
(Expert) 05 September 2011
A license is defined under Section 52 (Chapter VI) of the Indian Easement Act, 1882. The definition of license reads as follows:
"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."
The License is not a lease. The Lease and the License both are different. In a number of judgements various High Courts as well as the Apex Court have distinguished the lease and the licnese. In the matter of Milka Singh v/s Diana reported in AIR 1964 J & K at Page 99, the Bench of the Jammu and Kashmir High Court has held:
"A mere license does not create any estate or interest in the property to which it relates; it only makes an act lawful which without it would be unlawful. Thus the status of a licensee is essentially different from that of a trespasser or a tenant. In fact, the possession of a licensee is not a juridical possession but only an occupation with the premission of the licenser. While the actual occupation remains with the licensee, the control or possession of the property is with the licensor through his licensee. There is always an element of animus possidendi in the possession of a trespasser which is completely absent in the possessionof a licensee. In these circumstances therefore, it cannot be said that the moment the license is terminated, the licensee & rs quo's possession becomes that of a trespasser.
"A licensee is a licensee whether the license is for occupation of the premises or for casual visits or for any other purpose. The status of a licensee cannot change or vary according to the purpose of the license. The principle once a licensee always a licensee would apply to all kinds of licenses."
Similarly in the matter of Chandulal v/s Delhi Municipal Corporation, the Full Bench of the Delhi High Court in a Judgement reported in AIR 1978 Delhi Page 174 has inter alia held that:
"A lease is not a mere contract but envisages and transfers an interest in the demised property creating a right in favour of the lessee in rem. A license only makes an action lawful which without it would be unlawful but does not transfer any interest in favour of the licensee in respect of he property.
"In the case of a license there is something less than a right to enjoy the property in the licensee,; it cannot be exercised by sevants and agents and is terminable while on the other hand, in the case of a lease, there is a transfer of a right to enjoy the property or in other words the lessee is entitled to enjoy the property. A bare licensee having no interest in the property but is only a personal privilege to the licensee. After the termination of the license, the licensor is entitled to deal with the property as he likes. The right he gets as an owner in possession of his property. He need not secure a degree of the Court to obtain this right. He is entitled to resist in defence of his property the attempts of a trespasser to come upon his property by exerting the necessary and reasonable force to expel a trespassed.
"If however, the licensor uses excessive force, he may make himself liable to be punished under a prosecution, but he will infringe no right of the licensee. No doubt a person in exclusive possession of the property is prima facie to be considered to be a tenant, nevertheless he would not be held to be so if the circumstances negative any intention to create a tenancy. Case law relied. "
Likewise even the Apex Court in the matter of Rajbir Kaur & Anr V/ M/s S Chokesiri & Co reported in 1988 (2) RCJ Page 316, has held:
"License and Lease - Twin tests for determining whether an occupier is a licensee or a tenant:
(i) Right to exclusive possession.
(ii) The "rent stipulated for the grant; However, the exclusive possession itself is not decisive in favour of a lease and against a mere license;
"Operative intention of the parties is the determining factor – Regard must be had more to the substance than the form of the transaction – It is determined by the Law and not by the label the parties chose to put to it. (Transfer of Property Act, 1882 ; Section 105; Indian Easements Act, 1882; Section 52)."
Even in the matter of Khalil Ahmed Bashir Ahmed v/s Tufelhussein Samasbhai Sarangpurwala reported in 1988 SCC Page 155, the Supreme Court has held:
"In order to determine whether a document created a licence or a lease the real test is to ascertain the intention of the parties ie whether they intended to create a license or a lease. If the document creates an interest in the property entitling the transferee to enjoyment, then it is a lease; but if it only permits another to make use of the property without exclusive possession, then it is a license. Substance of the document must be preferred to form."
From all the aforesaid judgements and the principles, it is crystal clear that the lease agreement and the agreement of Leave and License are not one and the same but different.
Kiran Kumar
(Expert) 05 September 2011
Mr. Vishal has given you the basics of the terms Lease and License and sufficient enough to understand the concept...
prabhakar singh
(Expert) 05 September 2011
well explained by Mr. A V vishal.
Raj Kumar Makkad
(Expert) 05 September 2011
Nothing requires to be added in the advice of vishal.
girish shringi
(Expert) 05 September 2011
Thanx!
Vishal for spreading the knowledge.
