Leasing, which is a popular term is a method in which a company or an organization makes use of the permanent property for which an amount had to be paid like periodic and contractual tax deductible expenses. The person who receives the services or leasing under the contract is called the Lessee. The owner of the property or assets will be called the lesser. The amount payable or the consideration for leasing will be called rent. Normally a person who is the owner has the absolute liability to do whatever he wants with his property, if it’s to sell or to destroy it. He has the absolute ownership. But the situation will be different if the person only has possession of the property. Then there won’t be absolute ownership. If he does anything out of the ordinary that is try to sell it or destroy then the action will be unlawful. This is a concept known to all.
For this, the property usually will be given for a regular term that is for a fixed period. If for example, the lease is given for 10 months and when the 11th months comes the term will end automatically, that is leasing will end. In this case there is no need for any notification. Sometimes, the terms will be depending on some conditions like on the happening of a certain event like the death of an individual. Leasing depends upon the term.
Sometimes the term of the lease will be depending upon renewal policy. That leasing time period will be specified and the term will be renewed depending upon the end period of the specified time. And tenancy will depend upon the wish of the parties. Once the parties wish to end the term of Leasing, they can do so. Holding over policy of tenancy is common in Leasing.
This is also be possible for intangible property like computer programme, radio frequency etc. Sometimes a flat rental payment will be given. There are cancellable and non cancellable Leasing. Non cancellable as name itself indicates, cannot be cancelled. In the lease time certain conditions has to be abided. Specific provisions will be provided for this in the agreement. By paying the specified fee, lessee will have the right of possession of the asset or property. The common form of leasing is what we all know that is residential rental agreement. This is between the tenant and land lord. This relationship in leasing is called tenancy. Understanding these terms will be useful while you involve in any kind of leasing.
There is a difference between lease and license. Leasing is given by way of making regular payment during the lease term. Owner of a property has absolute right on his property as mentioned above. If the owner has given the possession of the property to somebody then making or creating interference with the quite enjoyment of the property is unlawful. Same is the case with real and personal property.