Difference between Lease and License of Property

Lease and license are distinct legal arrangements regarding the use of property, governed by the Transfer of Property Act, 1882 and Indian Easements Act, 1882.

While leases involve the transfer of a legal interest and grant exclusive possession to the lessee, licenses provide only permission to use property without creating any estate or interest.

Key Differences:

1. Transfer of Interest:

Lease: Transfers an interest in property; lessee gets exclusive possession.

License: No interest is transferred; licensee gets limited rights.

2. Possession:

Lease: Grants exclusive possession.

License: Does not grant exclusive possession.

3. Duration and Transferability:

Lease: Fixed or perpetual; inheritable and transferable.

License: Limited duration; personal and non-transferable.

4. Revocability:

Lease: Not revocable at will; ends per agreement or by mutual consent.

License: Generally revocable at the licensor's discretion.

5. Right to Improvements:

Lease: Lessee may enjoy improvements during the term.

License: No rights to improvements.

6. Legal Protections:

Lease: Lessee can defend possession in court.

License: Licensee lacks defendable possession rights.

Understanding these differences helps property owners and users navigate their rights and obligations effectively.

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