A License Rental Agreement is essential when parties wish to create a temporary right to use property without establishing a landlord-tenant relationship under Indian law. This document is particularly useful for flexible workspace arrangements, short-term commercial uses, or situations requiring quick termination rights. The agreement must comply with the Indian Easements Act, 1882, the Indian Contract Act, 1872, and relevant state property laws. It typically includes detailed provisions about the permitted use of the property, license fees, maintenance responsibilities, and termination rights. The document is structured to clearly distinguish itself from a lease agreement, emphasizing the personal nature of the right granted and avoiding the creation of any interest in the property.
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1. Parties: Identifies and provides full details of the licensor and licensee, including registered addresses and company registration numbers if applicable
2. Background: Explains the context and purpose of the license rental arrangement
3. Definitions: Defines key terms used throughout the agreement
4. Grant of License: Explicitly states the grant of license and distinguishes it from a lease/tenancy
5. Licensed Premises: Detailed description of the premises being licensed
6. Term and Renewal: Duration of the license and any renewal provisions
7. License Fee and Payment Terms: Amount, payment schedule, and payment methods
8. Security Deposit: Amount, terms of holding, and conditions for refund
9. Permitted Use: Specific purposes for which the premises may be used
10. Licensee's Obligations: Responsibilities and duties of the licensee
11. Licensor's Obligations: Responsibilities and duties of the licensor
12. Utilities and Maintenance: Responsibility for utilities, repairs, and maintenance
13. Insurance and Liability: Insurance requirements and allocation of risks
14. Termination: Grounds and procedure for termination
15. Governing Law and Jurisdiction: Specifies Indian law as governing law and relevant jurisdiction
16. Notices: Process and addresses for serving notices
17. Execution: Signature blocks and execution formalities
1. Fit-out Works: Include when licensee is permitted to carry out modifications or installations
2. Common Areas: Include when license includes use of shared facilities
3. Service Level Standards: Include when specific service levels are to be maintained
4. Assignment and Sublicensing: Include when transfer rights need to be explicitly addressed
5. Force Majeure: Include when specific events beyond parties' control need to be addressed
6. Environmental Compliance: Include for premises where environmental regulations are significant
7. Intellectual Property: Include when IP rights are involved in the licensed use
8. Confidentiality: Include when sensitive information will be shared
1. Schedule 1 - Floor Plan: Detailed plan showing the licensed area
2. Schedule 2 - Inventory: List of furniture, fixtures, and equipment included
3. Schedule 3 - House Rules: Building regulations and operational guidelines
4. Schedule 4 - Service Charges: Breakdown of additional charges and utilities
5. Schedule 5 - Maintenance Schedule: Regular maintenance and cleaning responsibilities
6. Schedule 6 - Handover Form: Condition report for start and end of license
7. Schedule 7 - Permitted Alterations: Approved modifications or installations if applicable
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