RENT DEED
VIJAY K. TEOTIA
(Querist) 01 October 2010
This query is : Resolved
What is difference between a Rent deed, Lease deed and Leave & Licence deed pertaining to residential property. Is there any difference if such document relates to commercial premises.
R.Ramachandran
(Expert) 01 October 2010
Dear Mr. Vijay,
First and foremost, any lease deed relates to transfer of right to use - whether it is immovable (i.e. house property - residential or commercial / land property) or movable property - say tractors, buses, equipment, machinery, generators, plant etc.
According to the Registration Act, 1908, if any lease of immovable property is for more than 12 months, then the same is required to be registered compulsorily. The value of the transaction for the purposes of stamp duty, is the annual rental value.
If the lease of such property is for less than 12 months (most people make it for only 11 months to be on safer side) there is no requirement for registration. In such cases, unless the lease is extended for further period, the lessee has to leave the premises. That is how it is popularly called "leave and licence" agreement.
I hope this answers your question.
H. S. Thukral
(Expert) 01 October 2010
Dear Learned Experts
Kindly look at the query carefully and then answer. Mr. Teotia is asking difference between a rent deed, lease deed and Leave and & License deed and if there is any difference if the same relate to commercial property?.
I am of the opinion that there should be a separate panel of Legal Pundits who just add ' I agree ' to all the queries.
Mr. Ramachandaran has totally gone wrong in describing a Leave and License deed.
Mr. Teotia
In the case of lease there is transfer of interest in property in whose favour lease is granted but in the case of license it is allowing a person to do an act without transfer of interest. One of the main difference is that in case of lease an exclusive possession is given. There may be disputes whether the document is of a Lease or of Leave and License. If the effect of the document is to give the holder an exclusive right of occupation of land though subject to certain reservations, it will be a Lease. A License on the other hand is given PERMISSION to do SOME ACT which without such permission it would be unlawful to do
A Lease is defined in section 105 of the TP Act and a License is defined in section 52 of the Easements Act. A rent deed however is a simple agreement where an interest is passed to another person for some consideration. It may apply to both Leave and License deed as well as to a Lease. There is no difference in application of the definitions to commercial property or a domestic property. However the Lease in case of Industrial and Agricultural Land differs on duration. A lease of immovable property for agricultural or manufacturing purposes , in the absence of any contract, shall be a lease from year to year terminable by a notice of six months while in the case of domestic purposes the same shall be from month to month terminable by 15 days notice.
VIJAY K. TEOTIA
(Querist) 03 October 2010
My doubts are clear by Mr Thukral. Thanks
