Though often used interchangeably, lease, rent, and license have distinct legal meanings—and knowing the difference protects your rights.

Lease

• A legal transfer of interest in property for a fixed term

• Grants exclusive possession to the tenant (lessee)

• Governed by Section 105 of the Transfer of Property Act, 1882

• Not easily revocable—offers tenure security

• Can be inherited or transferred, unless restricted

Rent

• Common term used for payment made under a lease or license

• Not a legal category by itself—refers to the financial consideration

• Can apply to both lease and license agreements

• Amount, frequency, and terms are defined in the agreement

License

• A permission to use property without transferring possession

• No legal interest or estate is created

• Governed by Section 52 of the Indian Easements Act, 1882

• Usually revocable and non-transferable

• Used for short-term or flexible arrangements (e.g., kiosks, stalls)