Apex Law Journal
Apex Law Journal
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Neha Goel, Advocate

Advisory Board

S.C. Khunger, Advocate

Rohit Bansal, Advocate

Varinder Singh Kanwar, Advocate

Hittan Nehra, Advocate

Judgments on Licence

Wednesday, August 31, 2011

Licence — Held, licences can be of different kinds — Some licences with reference to use of immovable property may be very wide, virtually bordering upon leases — Some licences can be very very narrow, giving a mere right enabling a person to visit a premises – say a museum or a lecture hall or an exhibition — In between are the licences of different hues and degrees — All licences can not be treated on the same footing — Indian Easements Act, 1882, Section 52.


Licence — Where the licence in favour of the licensee is only to use the retail outlet premises or use the equipments/facilities installed therein, exclusively in connection with the sale of the goods of the licensor, the licensee does not have the right to use the premises for dealing or selling any other goods — When the licensee cannot use the premises for any purpose on account of the stoppage of supply of licensor’s goods for sale, it will be wholly unreasonable to require the licensor to sue the licensee for ‘possession’ of such company controlled retail outlet premises — This is not a case where the licensee has alleged that any amount is due to it from the licensor by way of commission or remuneration for services, or that on account of non-payment thereof it is entitled to retain the retail outlet premises and facilities of the licensor by claiming a lien over them under section 221 of the Indian Contract Act, 1872 — It is made clear that this decision applies only to licences where the licensor is the owner/ lessee of the premises and the equipment (in this case dispensing pumps and other equipment) and where the licensee is engaged merely for sale of the products of the licensor — In other words, this decision would apply to petrol stations which are known as CCROs (‘Company Controlled Retail Outlets’) — If the licensee is himself the owner/lessee of the premises where the petroleum products outlet is situated or where the exclusive right to use the premises is given to the licensee for carrying on any business or dealing with any goods unconnected with the licensor, this decision may not apply and it may be necessary for the licensor to have recourse either to a Civil Court for a mandatory injunction to give up the premises, or the Estate Officer under the Public Premises Act for ‘eviction’ as the case may be, depending upon the nature of licence and the status and relationship of the parties.


Licence — If the licensor answers the definition of ‘state’, a duty to act fairly and reasonably without any arbitrariness or discrimination is also implied — Constitution of India, 1950, Article 12.


Licence — In regard to a licence governed by a commercial contract, it may be inappropriate to apply the principles of Administrative Law, even if the licensor may answer the definition of ‘State’ under Article 12 of the Constitution of India — Constitution of India, 1950, Article 12.


Licence — Whether there is any need for the licensor (that is the employer or the principal) to file a suit for eviction or injunction against the ex-employee or ex-agent so as to prevent them from entering upon the premises or using the premises? — Held, when the employment or agency is terminated and the employer/principal informs the employee/agent that his services are no longer required and he is no longer the employee/agent, the licence granted to such employee/agent to enter the retail outlet stands revoked and the exemployee/ ex-agent ceases to have any right to enter the premises — There is no need for the licensor (that is the employer or the principal) to file a suit for eviction or injunction against the ex-employee or ex-agent — The licensor can protect or defend its possession and physically prevent the licensee (employee/agent) from entering the outlet.

Monday, May 22, 2006

Licence — Termination or revocation of the licence — Eviction of licensee — Where after termination or revocation of the licence, the licensor does not take prompt action to evict the licensee from the premises, held, ex-licensee may be treated as a trespasser and the licensor will have to sue for recovery of possession.


Licence — Expiry of licence period — The licensee may have to continue to be in occupation of the premises for sometime to windup the business, if any, even after the expiry of licence period — In such a case the licensee, held, cannot be treated as a trespasser — A  licensee’s occupation does not become hostile possession or the possession of a trespasser the moment the licence comes to an end.


Licence — Though licensee may be the actual occupant but the licensor is the person having control or possession of the property through his licensee even after the termination of the licence.

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