Vummidi Bangaru Chetty (P) Ltd vs M/S.Spencer & Co.Ltd on 19 April, 2002
25. A reading of the above extracted portion makes it clear
that if the instrument intended to create an interest in the property, then,
it would be a lease and if it does not, it would only be a licence.
Therefore, the crucial test here is creation of interest in the property while
concluding the proposal by way of a contract in order to hold the same as a
lease. If the said conclusion by way of creation of interest in the property
is not disclosed, then it could only be construed as a licence and not a
lease. Again in the judgment of the Hon'ble Supreme Court reported in AIR
1965 SUPREME COURT 610 (Mrs.M.N.Clubwala and another v. Fida Hussain Saheb
and others), it has been held that the intention of the parties is very
relevant for determination of the transaction.