When it comes to allowing someone to occupy a property, two common options are Lease and Leave and License agreements. While they may seem similar, the legal rights and implications are distinct. In this blog, we’ll break down the key differences to help you make an informed decision.
1. Possession & Legal Rights
- Lease: Grants exclusive possession to the tenant, creating a legal interest in the property.
- Leave & License: Offers temporary use without transferring legal possession, and no interest is created.
2. Duration & Termination
- Lease: Generally long-term (12+ months) and harder to terminate.
- Leave & License: Short-term (usually 11 months) and easier to revoke.
3. Legal Framework
- Lease: Governed by the Transfer of Property Act, 1882.
- Leave & License: Covered under the Indian Easements Act, 1882.
4. Stamp Duty & Registration
- Lease: Mandatory registration, higher stamp duty.
- Leave & License: Lower stamp duty, easier registration process (especially in Maharashtra).
What Should You Use?
- Choose a Lease for long-term or commercial use.
- Go for Leave & License for flexibility and short stays.
Conclusion
Always choose the agreement that best fits your needs and get it reviewed legally. A small mistake today can lead to big complications tomorrow.
Need Help?
Need help drafting or registering your agreement? Reach out to Pankaj & Associates – we’ll ensure it’s legally sound and hassle-free. Contact us today!