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Leave and License in Goa - Why Eleven

Months only ?

There is a practice prevalent in Bombay that Leave & Licence Agreement in respect of a

residential premises is entered into and executed for a maximum period of 11 months. The

question arise whether it can be for more than 11 months.

A licence has been defined in Section 62 of the Indian Easement Act, as a right to do or

continue to do something in or upon an immovable property . It does not transfer the interest

or create any interest in the immovable property , like a � LEASE�, as defined in Section

105 of the Transfer of Property Act, as a right to enjoy property for a certain period in

consideration of the price paid. Provisions of Section 62 of the Indian Easements Act do not

prescribe , any minimum or maximum period for which a licence may be granted.

A lease of a immovable property in Bombay is governed by the provisions of Bombay Rents

Hotel & Logging House Rates Control Act, 1947 ( Popularly known as Bombay Rent Act, )

which no where provided , prior to 1.2.1973 for giving a residential premises on Leave &

Licence basis.

Still the practice was in vogue to give the residential premises on Leave & Licence basis . An

instrument creating a lease of immovable property for a term of one year and above was
required compulsorily to be registered by virtue of provisions of Section 17(d) of the Indian

Registration Act. Therefore, such Leave & Licence Agreements were being executed for a

period of 11 months with duel intention namely to avoid the stamping of such agreement and

its registration and , secondly, to avoid interpreting such Leave & Licence Agreement as a

lease of the immovable property to avoid protection against vacation of the occupier, as per

the provisions of the said Bombay Rent Act.

In the year 1973 an amendment was carried out in the said Bombay Rent Act buy the State of

Maharashtra, where section 15A was introduced therein providing that any person in

occupation of any premises as a License on 1.2.1973 shall be deemed to have become a

tenant in respect of the premises in his occupiers of residential premises as licensees as on

1.2.1973 , became the statutory tenants of the premises with the benefit of protection against

vacation of the premises, except in accordance with the provisions of the said Bombay Rent

Act.

Thought, the State Government of Maharashtra regularised an illegal practice of creating

Leave & License in respect of residential premises, which was contrary to the provisions of

the said Rent Act, yet the Landlords, who did not or do not require the premises for their own

use, were not willing to give the premises to others which created imbalance in the Society in

as much as on the one hand sufficient was available and on the other, people were starving of

the accommodation, albeit for a temporary period. These were being held back by the owners

because of the apprehension of not getting the premises vacated, when they needed in view of

the protection provided to the tenants by said Bombay Rent Act. Therefore, it recognized the

need of giving the premises on Leave & Licence basis as a practical solution, to this problem

and, consequently, made a specific provisions by way of Section 13A2 for giving the

residential premises on licence basis, which also provided that in case of the failure of the

licencee to deliver the possession of the licensed premises on the expiry of the period of
licence , the licencee could be summarily evicted from the premises by the Competent

Authority as per the provisions of Section 31D of the said Bombay Rent Act. Again Section

13A2 does not provide for any specific period of a licence and further clarifies that an

Agreement of Licence in writing shall be conclusive evidence of fact of the licence. By virtue

of Sub-Clause (V) of Section 17(2) of the Indian Registration Act, and Instrument or Deed,

which by it does not create any right, title or interest in an immovable property does not

require registration. As stated above, a licence has been defined in Section 62 of the Indian

Easements Act as an act, which does not create or transfer any interest in an immovable

property.

When the concept of Leave and License has been recognised by the aforesaid Bombay Rent

Act by Section 13A2, which does not provide for any specified period of licence and an

agreement of Leave & Licence, which does not create any right title and interest in an

immovable property does not require registration under the Indian Registration Act, the

author is of the opinion that a Leave & Licence Agreement for more than 11 months is

legally valid and can be entered into for a period for more than 11 months , and such an

Agreement can simply be executed on a non-judicial stamp paper of Rs. 20/- as per Bombay.