Leave and License Agreement: Meaning, Format, Stamp Duty and Registration

A leave and license agreement is a written contract that lets a licensee use a property for a fixed period, without transferring any ownership rights. In Maharashtra, every such agreement must be in writing and registered, with stamp duty paid at 0.25% of the total rent and deposit value. You can now complete the complete process online through the IGR Maharashtra portal.

What Is a Leave and License Agreement?

If you're asking what a leave and license agreement is, it is an arrangement in which the owner (the licensor) gives the occupant (the licensee) permission to use a property. The licensee gets the right to stay, but no interest in the property itself.

Party Role	Description / Role
Licensor	The property owner who grants permission
Licensee	The person who occupies and uses the property

What Is the Difference Between Leave and License and Rent Agreement?

Both look similar on paper, but the legal effect is different.

Comparison Point	Leave and License Agreement	Rent (Lease) Agreement
Nature	Permission to use the property	Transfers a right to enjoy the property
Interest in property	None for the licensee	Some interest for the tenant

What Should a Leave and License Agreement Include?

A clear agreement prevents disputes later. Make sure yours covers:

1. Names as well as addresses of the licensor and licensee
2. Full property address and description
3. Licence period, start date, and end date
4. Monthly licence fee and due date
5. Security deposit amount and refund terms
6. Lock-in period and notice period
7. Maintenance, utility bills, and society charges
8. Termination conditions
9. Signatures of both parties and witnesses

Leave and License Agreement Format

A standard leave and license agreement format follows this structure:

Agreement Section	What It Contains
Title and Date	Name of the document and date of execution
Parties	Details of the licensor and licensee
Property	Address, area, and fittings provided
Term	Duration of the licence
Payment	Licence fee, deposit, and payment schedule
Obligations	Duties of each party
Termination	Notice period and exit terms
Execution	Signatures and witness details

Stamp Duty on Leave as well as License Agreement in Maharashtra

Stamp duty is 0.25% of the total value of the agreement. This value includes:

• Total rent for the full period
• Any advance rent or non-refundable deposit
• A notional interest of 10% per year on the refundable deposit

Example: Rent of ₹25,000 a month for 24 months comes to ₹6,00,000. A refundable deposit of ₹5,00,000 adds ₹1,00,000 as notional interest over two years. The total of ₹7,00,000 × 0.25% gives a stamp duty of ₹1,750.

Registration of Leave as well as License Agreement in Maharashtra

Under Section 55 of the Maharashtra Rent Control Act, 1999, every leave and license agreement must be in writing and registered under the Registration Act of 1908. The responsibility for registration lies with the licensor. A licensor who fails to register can face imprisonment of up to three months, a fine of up to ₹5,000, or both.

How to Register a Leave as well as License Agreement Online in Maharashtra?

Registering a leave and license agreement online saves you a trip to the sub-registrar's office. Here's how it works on the IGR Maharashtra portal:

1. Open the e-leave and licence option in the online services section.
2. Select the property's district and create a password.
3. Enter the property details and save them.
4. Add the details of both parties, including PAN and Aadhaar.
5. Enter the rent and other terms, then generate the draft.
6. Pay stamp duty and fees through GRAS.
7. Execute the document by capturing each party's photo and thumb impression.
8. Submit it to the Sub-Registrar Office and track the status with your token number.

You'll need a biometric device and a webcam to complete a leave and license agreement online.

Documents Required for a Leave and License Agreement

Party	Documents Required
Licensor	ID proof, PAN, photograph, and property proof such as Index II, a tax receipt, or an electricity bill
Licensee	ID proof, PAN, and photograph
Witnesses	ID proof and photograph

Leave and License Agreement Charges

Charge	Amount
Stamp duty	0.25% of total rent and deposit value
Registration fee (municipal areas)	₹1,000
Registration fee (rural areas)	₹500
Document handling charge	₹300

The licensee usually pays these charges, unless both parties agree otherwise.

How to Terminate a Leave and License Agreement?

Termination depends on the terms you've agreed to. Typically:

1. Check the lock-in period and notice period in the agreement.
2. Serve written notice to the other party.
3. Settle any pending rent and dues.
4. Inspect the property and hand over the keys.
5. Collect or refund the security deposit as agreed.

Common Mistakes to Avoid in a Leave and License Agreement

1. Not registering the agreement
2. Leaving the deposit refund terms vague
3. Skipping the lock-in and notice period clauses
4. Not listing the fittings and furniture provided
5. Forgetting to renew before the agreement expires

Frequently Asked Questions

1. Is a Leave and License Agreement mandatory in Maharashtra?

Ans: Yes. Under Section 55 of the Maharashtra Rent Control Act, 1999, it must be in writing.

2. Is a Leave and License Agreement required to be registered?

Ans: Yes. Registration is compulsory in Maharashtra, and the licensor is responsible for it.

3. Who pays the stamp duty on a Leave and License Agreement?

Ans: The licensee usually pays stamp duty and registration charges, unless both parties agree otherwise.

4. How is stamp duty calculated in Maharashtra?

Ans: Stamp duty is 0.25% of the total rent for the period, plus any advance or non-refundable deposit and 10% annual notional interest on the refundable deposit.