Leave and Licence Agreement Format (Commercial)
Grant permission to use an office or shop under a leave and licence arrangement and download the agreement as a Word file.
What it is
A leave and licence agreement gives the licensee permission to use premises for an agreed purpose and period, without creating a lease or any interest in the property. A licence is defined in Section 52 of the Indian Easements Act, 1882. Because no tenancy is created, the licensor keeps possession in law and the licence can end as the agreement provides.
When it is used
- Letting an office, shop or co-working space for business use.
- Allowing a group company or related business to use premises.
- Short-term use of commercial space for a defined purpose.
What the template covers
- Grant of licence, start date and duration
- Monthly licence fee, due date and annual escalation
- Refundable security deposit
- Permitted use of premises, maintenance and outgoings
- TDS and GST applicability on the licence fee
- Inspection, termination and jurisdiction
Details you will need
The generator asks for the following. Fields marked with an asterisk in the form are required; the rest can be left blank and filled in later in Word.
Agreement Details
Agreement Date; Place of Execution; Licence Start Date; Duration (months)
Licensor (Owner)
Licensor Name; S/o, D/o or W/o; Licensor Address; Licensor PAN
Licensee (User)
Licensee Name; Licensee Type; Licensee Address; Licensee PAN; Authorised Rep & Title
Licensed Premises
Premises Address; Premises Description; Permitted Use
Financial Terms
Monthly Licence Fee (₹); Refundable Deposit (₹); Fee Payable by (day); Annual Escalation (%); TDS / GST applicability
Termination
Notice Period (months)
Stamp duty, registration and filing
Stamp duty is payable under the State's Stamp Act and differs by State. Registration requirements also vary: for example, in Maharashtra, leave and licence agreements must be registered under Section 55 of the Maharashtra Rent Control Act, 1999, whatever their term. Licence fees for commercial premises may attract GST where the licensor is registered, and the licensee may need to deduct TDS on rent.
Generate the Leave & Licence Agreement (Commercial)
Fill in the form and download the draft as a Word file. It is a general template, not legal or professional advice; have it reviewed for your facts before you sign or rely on it.
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Frequently asked questions
How is a leave and licence agreement different from a lease?
A lease transfers a right to enjoy the property and can create tenancy rights. A licence is only a permission to use the premises and does not create any interest in the property, which is why owners often prefer it for commercial space.
Is GST payable on the licence fee?
Renting or licensing commercial premises is a taxable supply, so a GST-registered licensor charges GST on the licence fee. Residential premises let for residence are treated differently.
Does a leave and licence agreement need registration?
It depends on the State and the term. Maharashtra requires registration of all leave and licence agreements; elsewhere, check the State's rules and the Registration Act, 1908, especially for terms exceeding one year.
This page gives general information for reference only. Laws, stamp duty rates and filing requirements change and differ between States, so confirm the current position for your case. Related: all document templates · free tax calculators · compliance calendar and guides.