THE DEFINITION OF LICENSE UNDER INDIAN LAW

"License" in immovable property can be summarized as a personal (In-Personam), permissive,

nontransferable and unassignable contractual right to use a property in a certain agreed way for a
certain agreed purpose.
According to some scholars, the legal instrument of "License" in immovable properties was
developed to deal with the legal complications of lease and rental rights under Indian law. In
particular, this legal instrument was developed to enable property owners to restrict lessees and
evict them more easily. The main difference between a license and a lease is that a license does not
create a right in property itself, therefore eviction is practically immediate and hassle free.
Still, many property owners that intended to protect themselves by entering a leave a license
agreement (i.e. a license agreement to use an immoveable property for a certain purpose), find
themselves facing court decisions ruling that their agreement was in fact a lease agreement. Some
of the mistakes made by such property owners may be avoided.
The first thing to do is to understand what a license really is.
THE LEGAL DEFINITION OF LICENSE
The Indian legislator defined the legal definition of "license" in section 52 of The Indian Easement
Act, 1882, as follows:
"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 immovable property of the grantor, something which would, in the absence
of such rights, be unlawful, and such right does not amount to an easement or an interest in the
property, the right is called a license."
The Indian Supreme Court filled this definition with essence in the famous decision of Associated
Hotels of India Ltd. vs. R.N. Kapoor [AIR 1959 SC 1262] as follows:
"Under the aforesaid section [*section 52 of The Indian Easement Act], if a document gives only a
right to use the property in particular way or under certain terms while it remains in the possession
and control of the owner thereof, it will be a license. The legal possession, thereof, continues to be
with the owner of the property, but the licensee is permitted to make use of the premises for a
particular purpose. But for the permission, his occupation would be unlawful. It does not create in his
favour any estate or interest in the property".
According to the above, the main characteristics of license are: License does not generate a
proprietary right (In-Rem) in the property, but only a personal-contractual right; license may not be
transferred or assigned; License can be created by permission only, whether express or implied;
License does not create any estate or interest in the property.
GRANTING A LICENSE

Two preliminary questions that rise when entering into a Leave and License agreement are who can
grant a license and how a license is granted.
The first question is answered in section 53 of The Indian Easement Act, 1882, that states that a
licensee may be granted by anyone in the circumstances and to the extent in and to which he may
transfer his interests in the property affected by the license. In other words, one cannot grant a
license and one cannot receive a license if the licensor does not possess a sufficient lawful interest
in the property.
The second question is answered in section 54 of The Indian Easement Act, 1882, that states that a
the grant of a license may be express or implied from the conduct of the grantor, and an agreement
which purports to create an easement, but is ineffectual for that purpose, may operate to create a
license. This definition is very important. Owners of properties should mind that their behavior may
create a license, even without a formal license agreement.
TERMINATION AND REVOCATION OF LICENSE
The Indian Easement Act, 1882, includes several important clauses related to the termination and
revocation of a license.
The first important clause is section 59 that states that when the grantor of the license transfers the
property, the transferee is not bound by the license.
Another important clause is section 60 that states that a license may be revoked by the grantor,
unless it is coupled with a transfer of property and such transfer is in force, or if the licensee, acting
upon the license, has executed a work of a permanent character and incurred expenses in the
execution.
Another important clause is section 60 that states that a revocation of a License may be express or
implied. According to this section, the grantor may revoke the license by simply preventing the
access to the property or by transferring the property.
Section 62 to The Indian Easement Act, 1882, further state several occurrences that are deemed as
revocation of license, including (but not only) the following occurrences: when the grantor ceases to
have any interest in the property due to a cause preceding the grant; when the licensee releases the
license, expressly or impliedly; where the period of the license ended; where the license was
acquired on condition and the condition is fulfilled; where the property is destroyed or permanently
altered by superior force I a way that the licensee can no longer exercise his right; where the
Licensee becomes entitled to the absolute ownership of the property; and where the license is
granted for a specified purpose and the purpose is attained, abandoned or becomes impracticable.
As per the other occurrences, please review the act.
LICENSEE'S RIGHTS ON REVOCATION
The Indian Easement Act, 1882, includes several clauses that are intended to protect the licensee's
reasonable expectations where a license in revoked. The first important clause is section 63 that

states that the licensee is entitled to receive a reasonable time to leave the property and to remove
any goods that he was allowed to place on the property. The other important clause is section 64
that states that the licensee is entitled to recover compensation from the grantor where a license that
has been granted for a consideration was revoked by the grantor before the licensee not due to a
fault of the licensee before he had fully enjoyed the license,.
WORDING A LEAVE AND LICENSE AGREEMENT