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What is Leave and licence?

The rental agreement used in Maharashtra, which must be registered.

A leave and licence agreement lets a licensee use a property without creating a tenancy. In Maharashtra these agreements must be registered; many are made for 11 months or more with a lock-in.

Example

Renting a flat in Pune

An owner in Viman Nagar, Pune, lets a 2 BHK at ₹32,000 a month for 11 months with a ₹1,00,000 deposit. Because the home is in Maharashtra, the leave and licence agreement must be registered; both parties complete the online registration with Aadhaar authentication, pay the stamp duty and registration fee, and keep the registered copy for police verification.

Figures are illustrative, not market rates.

Questions about Leave and licence

Is registration of a leave and licence agreement compulsory in Maharashtra?

Yes. Section 55 of the Maharashtra Rent Control Act, 1999 requires leave and licence agreements to be in writing and registered, whatever their term. The Department of Registration and Stamps offers online registration, so many agreements are registered without a visit to the sub-registrar.

How is leave and licence different from a lease?

A lease transfers an interest in the property to the tenant. A licence only gives permission to use it, without creating a tenancy or interest, which is why owners in Maharashtra prefer it. The difference affects eviction and rights on expiry.

Why are many rental agreements 11 months long?

Outside Maharashtra, the Registration Act, 1908 makes registration compulsory for leases of more than one year. An 11-month agreement avoids that requirement in many states. Maharashtra is different: leave and licence agreements there must be registered even for short terms.

Sources

See also

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In PropZolo

The Maharashtra leave & licence template drafts from the deal, goes for Aadhaar e-sign with e-stamp and opens a registration task.

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