A leave and licence agreement lets someone occupy premises without creating a tenancy. The licensor keeps legal possession and can revoke the licence and ask the licensee to leave, without the eviction machinery that protects a tenant. Because that distinction is valuable, the draft must make the licence character unmistakable. This page explains the difference from a lease under the Transfer of Property Act 1882, the clauses the document must carry, stamping and registration, and the drafting mistakes that turn a licence into a lease.
When this matters
This applies to owners who want to let premises for a limited period without conferring the rights of a tenant, and to occupants who need to know what they are signing. It is common for short-term residential letting, guest and paying-guest arrangements, and office or shop sharing, where the owner wants the premises back readily.
Why the licence and lease distinction matters
A lease under the Transfer of Property Act 1882 transfers a right to enjoy the property and creates an interest in the premises. A licence is only a permission to use the premises; it does not transfer any interest and is generally revocable. The difference shows up in two places: possession, and eviction. A lessee in West Bengal who is protected by the West Bengal Premises Tenancy Act 1997 can resist eviction and can only be displaced on a statutory ground through a decree. A licensee who overstays holds no such interest, and the licensor's remedy is to revoke the licence and sue for possession on that footing, which is a different and usually quicker route. Our landlord and tenant disputes and eviction suits teams handle both kinds of claim.
Clauses the agreement must contain
- The parties — the licensor (owner) and the licensee — with full names and addresses.
- A clear statement that it is a leave and licence and not a lease, and that no interest in the property is created.
- The premises, identified by address and description.
- The licence fee — the amount, the payment cycle, and the mode of payment.
- The period of the licence, with stated start and end dates.
- A clause stating that the licence is revocable, and the notice period for revocation.
- A clause that possession remains with the licensor and that the licensee has no exclusive possession.
- Maintenance and utility obligations — who pays electricity, water, and municipal charges, and who maintains the premises.
- A notice-to-vacate clause and the licensee's obligation to vacate and remove belongings on expiry.
- Security deposit, and its refund on vacating.
Ready drafts and clause banks are available through our landlord and tenant formats.
Stamp duty and registration
The agreement should be executed on stamp paper of the value prescribed by the West Bengal stamp schedule for the instrument, and it is prudent to have it notarised or, where the term and the nature of the instrument require it, registered. A written document that reads as a lease for a term exceeding one year is a matter in which registration under the Registration Act 1908 can be required; a leave and licence, which creates no interest, is handled differently. Because the amounts and the registration question depend on the term and the schedule in force, these should be confirmed before execution rather than assumed.
Termination and overstaying
On expiry, or on revocation with notice, the licensee must vacate and remove belongings. If the licensee overstays, the licensor does not need to establish a tenancy ground; the licensor can revoke the licence in writing and institute a suit for possession and for mesne profits for the period of unauthorised occupation, along with a claim for the licence fee due. The suit rests on the licence document, the notice of revocation, and proof of the overstay. The licensor should not resort to self-help by removing the occupant's belongings or cutting off utilities.
Mistakes that make a licence read as a lease
- Giving the licensee exclusive possession, with a single key and no access for the owner.
- Describing the payment as "rent" throughout instead of "licence fee".
- Naming the parties "landlord" and "tenant" rather than "licensor" and "licensee".
- Fixing a long term with a renewal right that gives the occupant security of tenure.
- Making the licence irrevocable during its term.
- Granting a transferable right, or a right to sublet.
Any of these can persuade a court that the true relationship is that of landlord and tenant, and the occupant then gains the protection the licensor wanted to avoid.
Common questions
Does a leave and licence need to be registered?
Because a licence creates no interest in the property, it is not treated as a lease for a term and does not require registration the way a long lease does. It should still be properly stamped, and the requirement is confirmed against the term before execution.
Can the licensor evict a licensee without notice?
The licence should be revoked with the notice the agreement provides, and then possession can be claimed. A well-drafted revocation and notice clause keeps the process orderly.
What if the licensee stops paying the licence fee?
Unpaid licence fee is a debt; the licensor can claim it, and can also revoke the licence for breach and sue for possession. A criminal complaint is not the route for a pure fee default.
Can a licensee sublet the premises?
Only if the agreement allows it. Subletting or parting with possession without consent is a ground for revocation, and the clause should say so expressly.
FileX Advocates & Legal Consultants, Kolkata, drafts and files these matters before the Calcutta High Court, City Civil and Sessions courts, magistrate, family, consumer and tribunal forums. Call +91 7439811422 or WhatsApp us for a free first consultation.