A brief view of Lease and License. This PPT talks about the difference between Lease and License on the basis of agreement, interest, transferability, etc.

1. DIFFERENCE BETWEEN LEASE &
LICENSE: EVERYTHING YOU
NEED TO KNOW

2. INTRODUCTION
Lease and License may sound like the same thing, and you may have heard the terms
used interchangeably. However, a lease and a license are two separate legal concepts that
offer different rights and duties.
• A lease is an agreement between a landlord and a tenant that gives the tenant an
exclusive interest in a property.
• A license is a permission from the owner to a licensee to do on the owner's property.
As with all things law related, the distinction is never so simple.

3. LEASE AND LICENSE OVERVIEW
The difference between lease and license is the difference between two
distinct legal concepts pertaining to an individual’s duties and rights in a
contract. A lease is a contract between a tenant and a landlord that
provides the tenant with exclusive interest in the property. A license, on
the other hand, is when the owner gives permission to a licensee to
conduct an action on the owner’s property. The main difference then is
that leases give an individual the right to control property, while licenses
only give an individual the right to act on it.

4. SECTION 105 OF TRANSFER OF PROPERTY ACT
“Lease Defined - A lease of immovable property is a transfer
of a right to enjoy such property, made for a certain time,
express or implied, or in perpetuity, in consideration of a
price paid or promised, or of money, a share of crops,
service or any other thing of value, to be rendered
periodically or on specified occasions to the transferor by
the transferee, who accepts the transfer on such terms.”

5. SECTION 52 OF THE EASEMENTS ACT, 1882
“License, Defined - Where one person grants to another,
or to a definite number of other persons, a right to do,
or continue to do, in or upon the immovable property of
the grantor, something which would, in the absence of
such right, be unlawful, and such right does not amount
to an easement or an interest in the property, the right is
called, a license.”

6. DIFFERENCE BETWEEN
Lease License

7. AGREEMENT BETWEEN TWO PARTIES
Lease:
Usually, a lease requires a written or an oral agreement between two parties, the landlord and
the tenant. The lease transfers to the tenant a right to use the land or property however he/she
would like, pursuant to the conditions of the agreement.
License:
A license does not always require a written agreement. A license can be granted without the
owner and the licensee ever meeting. For example, you buy a ticket to a football game. The
ticket is a license granted by the stadium owner to allow you to enter the stadium. While you
never met the owner or negotiated with him, you accepted the license when you bought the
ticket.

8. INTEREST IN REAL PROPERTY
Lease:
A lease creates an interest in the property. For
the term of the lease, you have some ownership
rights in the property as agreed to in the
contract. You have the right to keep anybody,
even the landlord, out of the property.
License:
A license does not grant any interest in the
property. The ticket to the football game doesn't
give you any ownership right in the football
stadium. You also don't have any right to stop
your crazy Uncle Bob from buying a ticket and
entering the stadium.

9. TRANSFERABILITY
Lease:
Because you have an interest in the property, you can transfer your lease to another
person. This is what happens when people sublets an apartment.
License:
You cannot transfer a license. For example, the neighbor next door grants you
permission, a license, to climb on his tree. You can't then give permission to Susie to
climb the tree in your place. Susie can only climb the tree if the neighbour gave her a
license to do so too.

10. REVOCABILITY
Lease:
Subject to the terms of the contract, a lease is not
revocable by the owner. If you have a lease for a year, the
owner cannot revoke your right to the land after six
months without breaking the contract. However, a license
is revocable. In this case, the next door neighbour can tell
you at any time that you're no longer allowed to climb his
tree.
License:
If you are unable to determine if your agreement is a lease or a license, an experienced
landlord-tenant attorney may be able to help.

11. PRIMARY DISTINCTIONS BETWEEN LEASE & LICENSE
1. A lease is a transfer of an interest in a specific immovable property, while license is a bare permission, without any transfer of
an interest.
2. A lease creates an interest in favour of the lessee with respect of the property, but a license does not create such an interest.
3. A lease is both transferable and heritable, a sub tenancy can be created by the tenant and on the death of the tenant, the
tenancy can be inherited by his/her legal heir, whereas, license is neither transferable nor heritable.
4. A license comes to an end with the death of either the grantor or the guarantee, since it is a personal contract, but a lease
does not comes to an end on either the death of the grantor or grantee.
5. A license can be withdrawn at any time at the pleasure of the grantor but the lease can come to an end only in accordance
with the terms and condition stipulated in the contract of tenancy agreement.
6. A lease is unaffected by the transfer of the property by sale in favour of a third party. It continues and the purchaser has to
wait till the time period for which the tenancy was created is over before he can get the possession, whereas, in case of a
license, if the property is sold to a third party, it comes to n end immediately.
7. A lessee has a right to protect the possession in his own right. Whereas, a licensee cannot defend his possession in his own
name as he does not have any proprietary right in the property.
8. A lessee in possession of the property is entitled to any improvements or accessions made to the property, while a licensee is
not.