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LICENCE
(Ss. 52 to 64)
QUESTION BANK
Q.1 Define licence. State and explain the characteristics of licence. Distinguish between licence and easement?
Q.2 Define easement and distinguish it from licence.
SYNOPSIS
Law of Licenses under the Indian Easements Act, 1882
I. Statutory Definition of "License" (Section 52)
The Core Jurisprudential Character
II. Essential Elements or Characteristics of a License
1. Two Distinct Contracting Parties
2. The Act of a Grant
3. Permission to Do an Act
4. Direct Link to Immovable Property
5. Prevention of Unlawfulness
6. Negative Baseline: It is NOT an Easement
7. Negative Baseline: It Transfers No Interest in Land
8. Purely Personal and Non-Transferable (Section 56)
III. Comprehensive Structural Comparisons
1. License vs. Lease (Section 105 of the Transfer of Property Act, 1882)
2. License vs. Easement (Section 4 of the Indian Easements Act, 1882)
IV. Statutory Duties of the Grantor
1. Duty to Disclose Internal Defects (Section 57)
2. Duty Not to Render Property Unsafe (Section 58)
V. Statutory Rights of the Licensee upon Revocation or Eviction
1. Right to a Reasonable Time to Vacate (Section 63)
2. Right to Compensation for Premature Eviction (Section 64)
VI. Modes of Revocation of a License (Section 62)
1. By End of the Grantor's Interest:
2. By Explicit Release:
3. By Expiration of a Fixed Term:
4. By Non-Use for Twenty Years:
5. By Permanent Destruction via Superior Force
6. By the Licensee Becoming Absolute Owner:
7. By Full Fulfillment of the Object:
8. By Cession of Office or Employment:
9. By Expiration of a Dependent Accessory Right:
10. By the Happening of a Resolutive Condition:
VII. Non-Revocable Licenses (Section 60 Exceptions)
- License Coupled with a Transfer of Interest:
- Execution of Permanent Structures:
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Law of Licenses under the Indian Easements Act, 1882
I. Statutory Definition of "License" (Section 52)
Under Section 52 of the Act, a license is defined as
Where a person grants-
(i) to another or to a definite number of other persons,
(ii) a right to do, or continue to do,
(iii) in or upon the immovable property of the grantor,
(iv) something which would, in the absence of such right, be unlawful, and
(v) such right does not amount to an easement or an interest in the property
-the right is called a ‘licence.’
Thus, a licence is a right given to another person by a person in or on his immovable property for doing something which is wrong without such a licence.
The Core Jurisprudential Character
A license is a purely permissive right. It acts as a legal justification or an excuse that prevents an act (such as entering or staying on someone's land) from being treated as an unlawful trespass. It does not create a right in rem over the property; rather, it creates a personal relationship (right in personam) between the grantor and the licensee.
II. Essential Elements or Characteristics of a License
To satisfy the statutory definition of Section 52, a valid license must exhibit the following concurrent characteristics:
1. Two Contracting Parties
There must be a Grantor (the absolute owner or lawful controller of the property) and a Licensee (the person receiving the personal permission). Both parties must be legally competent to contract under the Indian Contract Act, 1872.
2. The Act of a Grant
A license fundamentally originates from a voluntary Grant. It can be granted either expressly in writing or implied through the conduct and consent of the owner.
3. Permission to Do an Act
The scope of the grant must be a right to do or continue to do something. It authorizes a specific physical action, use, or temporary occupation.
Illustration
A sells the trees growing on his land to B. B is entitled to go on the land and take away the trees.
4. Direct Link to Immovable Property
The permitted act must take place in or upon the specific immovable property of the grantor.
5. Prevention of Unlawfulness
The primary legal function of the license is to render an otherwise unauthorized act completely lawful. Without the license, the licensee's entry onto the property would constitute a civil trespass. Thus, if A permits B to take mango fruits from A’s trees for one season, it is a licence. B’s act of taking mango fruits without A's permission is wrong or theft.
6. Negative Baseline: It is NOT an Easement
A license cannot fulfill the requirements of an easement. It does not require the co-existence of a dominant and servient heritage, and it is not attached to land ownership.
7. Negative Baseline: It Transfers No Interest in Land
A license does not convey any estate, proprietary interest, or legal title over the property. The legal possession and absolute control of the property continue to remain with the grantor at all times.
8. Purely Personal and Non-Transferable (Section 56)
Under Section 56, a license is a purely personal right. Consequently:
a. A licensee cannot transfer, assign, or sub-license their right to an external third party.
b. The Sole Exception: A license to attend a place of public entertainment (such as a movie theatre ticket or a stadium pass) is freely transferable by custom, unless an express restriction blocks it.
Illustrations
a) A grants B the right to walk over A’s field whenever he pleases. The right is not annexed to any immovable property of B and cannot be transferred.
b) The Government grants B a licence to erect and use temporary grain sheds on Government land. In the absence of an express provision to the contrary. B’s servants may enter the land for the purpose of erecting sheds, erecting the same, depositing grain therein, and removing grain therefrom.
III. Comprehensive Comparisons
1. License vs. Lease (Section 105 of the Transfer of Property Act, 1882)
Differentiating a license from a lease is one of the most frequent areas of civil and property litigation:
Analytical Parameters | Lease (Sec. 105, TPA) DOCX | License (Sec. 52, IE Act) DOCX |
Transfer of Interest | Yes. Involves an actual transfer of a limited interest in immovable property. | No. Does not convey an interest or estate; it is a bare permission. |
Status of Possession | Transfers Exclusive Possession to the tenant. | Possession stays with the owner; the licensee has permissive use only. |
Transferability | Freely transferable and fully heritable by legal heirs. | Non-transferable and non-heritable; it is a personal right. |
Revocability | Cannot be revoked at the whim of the landlord before the term expires. | Generally revocable at the will of the grantor. |
Standing to Sue | The lessee can file an independent suit against trespassers in their own name. | The licensee has no standing to sue third parties in their own name. |
Effect of Property Sale | A subsequent sale of the property does not affect the lease; the buyer takes it subject to the lease. | A sale of the property automatically extinguishes and terminates the license. |
In Shantabai v. State of Bombay
Facts: In this case, the petitioner's husband, Shantabai, executed an unregistered deed in her favour. That deed gave her the right to enter certain areas in the Zamindari property and to cut and remove bamboo, fuel wood, and teak for twelve years.
Issue: Is the agreement lease or licence?
Supreme Court held:- the agreement is licence and not lease.
In ICICI v. State of Maharashtra
Fact:- In this matter, the contractor was put in possession of the property to construct a building on the property. There was no right granted in his favour in the property.
Issue:- Is the agreement a licence or lease?
Bombay High Court held:- that the agreement is licence.
2. License vs. Easement (Section 4 of the Indian Easements Act, 1882)
While both are partial restrictions on property, they arise from different juristic roots:
Parameters of Distinction | Easement (Section 4) DOCX | License (Section 52) DOCX |
Property Requirement | Requires two heritages: a Dominant and a Servient heritage. | Requires no dominant heritage; it is entirely independent of land ownership. |
Nature of Right | It is a proprietary right in rem that runs with the land. | It is a purely personal right in personam binding the parties. |
Modes of Acquisition | Can be acquired via a grant, absolute necessity, or 20 years of prescription. | Can only be acquired via an express or implied contractual consent. |
Positive / Negative Acts | Can be Positive (doing an act) or Negative (restricting a neighbor's structure). | Can only be Positive in nature, authorizing the performance of a physical act. |
Revocability | It is perpetual and irrevocable unless legally abandoned. | It is inherently revocable at the pleasure of the grantor. |
IV. Statutory Duties of the Grantor
To prevent injury or bad faith, the Act imposes two explicit statutory duties on the grantor:
1. Duty to Disclose Internal Defects (Section 57)
Under Section 57, the grantor is bound to disclose to the licensee any latent material defects or dangerous properties in the asset that the grantor is aware of, but which the licensee is not and cannot discover with ordinary care. If the grantor fails to disclose a known danger, they are liable to pay compensation for any resulting injury suffered by the licensee.
2. Duty Not to Render Property Unsafe (Section 58)
Under Section 58, a grantor who has given a license cannot subsequently do any act that renders the property unreasonably dangerous or unsafe for the execution of the permitted activities.
V. Statutory Rights of the Licensee upon Revocation or Eviction
Sections 63 and 64 provide structural financial safeguards to protect licensees from sudden, arbitrary evictions:
1. Right to a Reasonable Time to Vacate (Section 63)
Under Section 63, where a license is revoked, the licensee is entitled to a reasonable mode and timeframe to leave the premises and remove all physical goods or effects brought by them onto the land. The grantor cannot forcefully throw out the licensee's assets immediately upon revocation.
2. Right to Compensation for Premature Eviction (Section 64)
Under Section 64, if a license is granted for consideration (a paid license) for a specified timeframe, and the grantor prematurely revokes or evicts the licensee without any fault of their own, the licensee cannot block the eviction, but they hold an absolute right to recover monetary compensation from the grantor for the financial loss caused by the breach.
VI. Modes of Revocation of a License (Section 62)
A license is inherently unstable. Under Section 62, a license is legally deemed to be revoked by operation of law under exactly ten structural mode pathways:
1. By End of the Grantor's Interest: When the grantor's own power or limited interest in the property comes to an end, the subordinate license is automatically terminated.
2. By Explicit Release: When the licensee voluntarily executes a release surrendering the right back to the grantor.
3. By Expiration of a Fixed Term: When the explicit timeframe or period of years written into the license agreement lapses.
4. By Non-Use for Twenty Years: Where the licensee ceases to exercise their right for an unbroken, continuous period of twenty (20) years, the license is deemed abandoned and legally ends.
5. By Permanent Destruction via Superior Force: When an irresistible force or act of God permanently alters or destroys the affected property, making the right impossible to exercise.
6. By the Licensee Becoming Absolute Owner: When the licensee subsequently purchases or inherits the absolute ownership of the property, the license is merged and extinguished.
7. By Full Fulfillment of the Object: Where a license was granted to fulfill a single, specific purpose, and that purpose is successfully attained, abandoned, or rendered impossible.
8. By Cession of Office or Employment: Where a license is granted strictly because the licensee holds a specific office, public employment, or character, it ends the exact moment that employment or character ceases to exist.
9. By Expiration of a Dependent Accessory Right: In the case of an accessory license, when the primary interest or property right to which it is attached ceases to exist, the license is revoked.
Statutory Illustration: If A is licensed to harvest mangoes during a specific season from B’s orchard, the accessory right to physically walk onto the land is revoked by operation of law the moment the mango season ends.
10. By the Happening of a Resolutive Condition: Where the license contains an express clause stating it will become void upon the happening or non-happening of a specified future event, it ends when that condition is met.
VII. Non-Revocable Licenses (Section 60 Exceptions)
While the general baseline rule is that a license can be revoked at the pleasure of the grantor, Section 60 creates exactly two absolute statutory exceptions where a license becomes completely irrevocable:
1. License Coupled with a Transfer of Interest:
Where the license is directly coupled with a valid transfer of property interest, and that interest is still active.
Example: If A sells all the timber trees standing on his land to B, the license granted to B to enter the land with trucks to cut and remove the wood is irrevocable until the timber is cleared.
2. Execution of Permanent Structures:
Where the licensee, acting upon the faith of the license, has executed a work of a permanent character and incurred significant expenses in its construction.
Remedy Protection: If a landlord permits a licensee to build a concrete structure or a house on a plot, they cannot later revoke the license and demand demolition; the license becomes permanent and irrevocable.
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