When it comes to living or doing business in a property, most people in India use the terms lease, rent, and leave & license interchangeably. But legally, these three arrangements are very different — and choosing the wrong one can lead to disputes, financial loss, and complications during eviction.
This guide explains the key differences, legal implications, and when to choose each option.
What Is a Lease?
A lease is a long-term agreement where the landlord transfers the right to enjoy the property to the tenant for a fixed period — usually 3, 5, 10, or even 99 years.
Key Features of a Lease
- Long-term possession
- Tenant gets exclusive rights to the property
- Lease rights cannot be terminated easily
- Tenant may have more control (renovations, usage, etc.)
- Usually registered and legally binding
Best For
- Commercial businesses
- Factories & warehouses
- Long-term office spaces
- People seeking long-term stability
What Is Rent?
Rent is a short-term occupancy arrangement, commonly for residential use. The tenant pays monthly rent to use the property.
Key Features of Rent
- Short-term (11 months to 2 years)
- Tenant has possession but limited rights
- Rent agreements can be terminated with notice
- Monthly rent + security deposit
- Usually renewable at the end of the term
Best For
- Residential homes
- Students
- Small shops
- Tenants who need flexibility
What Is Leave & License?
A Leave & License agreement does not transfer possession — it only gives the licensee the right to use the property temporarily.
Builders, landlords, and companies prefer this model due to better control.
Key Features of Leave & License
- No transfer of interest in property
- Landlord keeps full legal possession
- Easy eviction if required
- Tenure usually 11 months
- Mandatory registration in many states (e.g., Maharashtra)
Best For
- Corporate housing
- Service apartments
- Short-term office spaces
- Where landlords want full control
Key Differences Between Lease, Rent & Leave & License
| Feature | Lease | Rent | Leave & License |
|---|---|---|---|
| Duration | Long-term | Short-term | Very short-term |
| Rights | Transfers property interest | Limited tenancy | Only permission to use |
| Eviction | Difficult | Moderate | Easiest |
| Registration | Mandatory | Optional (based on term) | Strongly recommended |
| Control | Tenant controls property | Shared control | Landlord controls property |
| Security | Higher deposit | Medium | Lower deposit |
Which One Should You Choose?
Choose Lease If You:
- Want long-term stability
- Plan business operations
- Want predictable costs for many years
Choose Rent If You:
- Want a home to live in
- Need short to mid-term flexibility
- Prefer easy renewal
Choose Leave & License If You:
- Need temporary accommodation or workspace
- Want easy exit options
- Prefer lower legal risk and hassle
Legal Importance of Choosing the Right Agreement
Choosing the wrong arrangement can lead to:
- Eviction issues
- Disputes over control
- Misuse of property
- Invalid agreements in court
- Problems with police verification
- Challenges in commercial compliance
A lawyer can help draft the right agreement based on your purpose and protect both parties from disputes.
Final Thoughts
Understanding the difference between lease, rent, and leave & license is essential for both landlords and tenants. Each agreement comes with specific legal rights and restrictions, and choosing the right one ensures smoother stay, clear expectations, and fewer conflicts.
If you need help drafting or reviewing lease/rent agreements or resolving tenancy disputes, consulting a property lawyer ensures your rights are protected.
