Leave & License Agreement Registration
To avoid any legal complications property owners and tenants should register their Leave and License Agreement and submit tenant’s information to the nearest Police Chowki.
What is registered Leave and License Agreement?
In the process of registration, Government saves a scanned copy of the agreement with one unique registration number in their database. This database is accessible by anyone at any time online.
What are the benefits of registered Leave and License Agreement?
- Duration of the agreement can be up to 60 months,
- One copy of the agreement gets stored in the Government Database which can be accessed online with the unique document number,
- It is more authentic document in case of any dispute between the parties,
- Licensee can use it as a valid address proof.
Leave and License Registration Process –
Leave and License Agreement can be registered online or offline, in the process of online registration parties need not require visiting the sub-registration office and the process can be done from any place and time.
- Collection of required information,
- Agreement drafting and finalizing the content,
- Submission of Agreement for Registration.
Required Documents -
- PAN Card and Aadhaar Card of Licensor/s,
- Aadhaar Card of Licensee/s,
- Aadhaar Card of two Identifiers,
- Electricity Bill OR Index II OR Tax Receipt of the Licensed Premises.
1. What are the important Clauses in the Leave and License Agreement?
Leave and License Agreement is a mutual contract between the Licensor and the Licensee and parties can add terms and conditions which best suits their mutual Agreement. There is no fixed format for this, however, following are the basic clauses which should be mentioned in the Agreement –
- Start and End Date – Parties should mention the start and end date to fix the duration of the Agreement.
- License Fees (rent) and Increment – Parties should mention the License Fees, the due date for its payment and penalty in case of nonpayment within the due date. There is no standard practice or rule for the increment. It depends up on the parties mutual understanding. Make sure that both parties should be clear on the increment to avoid the future problems.
- Payment of Deposit – Mention the amount of deposit, whether it is refundable or non-refundable, mode and details of payment and the deduction in case of any damage to the licensed premises or nonpayment of monthly License Fees.
- Duration of the Agreement – As per the law Leave and License Agreement can be done for up to 5 years. Avoid choosing 11 months duration as there is no logic of choosing that duration if the agreement is going to be registered. If Licensee is intending to live for the longer duration and Licensor also does not have any objection than duration can be extended. Longer duration is beneficial for both the parties as it saves the processing cost and the future work.
- Maintainance Charges – This can be borne by any party, again it depends on the mutual understanding of the parties. I advise keeping it to owners side as it is considered as income from rented premises and if there will be no tax exemption even if the tenant pays it.
- Other Charges – Other charges may include piped gas, water, etc. parties should be clear on the responsibility of payment of these charges.
- Use of Premises – In this clause Licensor can impose conditions regarding use of the premises like the licensee’s responsibility to not to create any nuisance, illegal activities, etc.
- Recovery of Damages – Here Licensor and Licensee can decide the way of recovery of damages in case of any damage done by the Licensee, etc.
- Internal and External Alteration – Parties can decide the extent of the permissible alteration and the responsibility of restoration.
- No Tenancy – This clause restricts the Licensee to transfer, assign, and sublet or grant any license or sub-license, raise a loan against the property or mortgage.
- Inspection – Parties can mention the owners or representatives right to inspect the property.
- Furniture and Appliances – Following points can be considered in this clause – List of furniture and appliances, the responsibility of the licensee to keep it in good condition, calculation of damages and recovery, etc.
- Lock in Period – This clause restricts both parties from canceling the Agreement for a specific period.
- Cancellation – Time of notice period from both sides for the cancellation of the Agreement.
- Possession – Licensor should mention the penalty and the legal provision in case the Licensee fails to hand over the peaceful possession of the premises after the expiration of the Agreement.
2. Is it compulsory to register a Leave & License Agreement for 11 months duration?
Most of the people have a misconception that the Leave & License Agreement can be made for the duration of 11 months only, it can be registered for the period of upto 60 months.
3. Why most of the people choose a duration of 11 months?
As per the Section 17 (d) of Registration Act, leases of immovable property for any term exceeding one year, or reserving a yearly rent should compulsorily be registered. Due to this rule, it became a practice to choose a duration of 11 months to avoid the registration process.
4. What about rent increment in the Agreements for the duration of more than 11 months?
Parties can mutually decide the rent increment and mention the same in the agreement.
5. Can parties cancel the Agreement before the expiration of the duration?
Yes, by mutual understanding parties can add the clause in the Agreement for cancellation.
6. What is Rent Agreement Registration Number?
Online Registered Rent Agreement – In case of agreement registered online, the document number can be found on the bottom of the pages and on the receipt too. Check the first image bellow, it is mentioned that “Registered as Document No.6839/2016 at the office of Joint S.R. Haveli 21 on 28/05/2016”, so the Rent Agreement Registration Number is “HVL21/6839/2016” (office name/document number/year of registration).
Offline Registered Rent Agreement – In the following second image, the agreement registration number is HVL23/8294/2017.
A. Online Registered Agreement
B. Offline Registered Agreement
7. How to check authenticity of registered Leave & License Agreement?
Every registered Leave and License agreement gets stored in the Government database by a unique “Document Registration Number (check the above images)”, by using those credentials anyone can check the authenticity of the document.
Follow the steps given below to make sure the document is registered and all the information is correct –
- Visit – https://esearchigr.maharashtra.gov.in
- Create a new account,
- Click on दस्त निहाय/Document Number,
- Select Registration type as “eRegistration”,
- Enter other credentials,
- Click on search,
- After a few seconds scroll down the page and check the Index II (Index II is the short description of the agreement).