Leave And Licence Agreement

This Packet Includes:

1. Information and Instructions

2. Leave and Licence Agreement

Information and Instructions

Leave And Licence Agreement

A Leave and Licence Agreement, as defined in Section 52 of the Indian Easements Act, 1882, gives the licensee the right to use and occupy the Licensed Premises for a limited duration. A Leave and Licence Agreement does not give tenants any ownerships right of the property, nor does it provide the same non-eviction protections given in a Tenancy Agreement, rather the license to occupy can be terminated as per the terms of the agreement or otherwise and licensor can demand possession back from the licensee.

This kind of agreement is specific to the city of Mumbai where owner prefer to use this agreement rather than a standard Tenancy or Lease Agreement in order to save on the Stamp Duty and registration charges. A Leave & License agreement is usually for a period of 36 months.

Under Section 55 of the Maharashtra Rent Control Act, 1999, it is compulsory that all Leave and Licence agreements should be in writing and registered. The penalty for failure to register is imprisonment up to 3 months, or a fine up to Rs. 5000 or both. Further, the responsibility of getting the agreement registered lies upon the landlord/owner and in the absence of a written agreement, the licensee’s version of the terms and conditions will be accepted. Please note, however, that if your flat is in a Co-operative Housing Society, the Society may insist on receiving a copy of the agreement before it grants permission to you to give the flat on leave and licence.

Note: Owners/Landlords must seek independent legal/taxation advice as to the amount of income tax to be paid, standard deduction earned on repairs and municipal taxes/ charges to be paid to the Municipal Authorities.

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