• Renting out a commercial premises to a cafe

Hey,

We have purchased a commercial property in the year 1993 in Bangalore . 

It is currently a commercially.converted property. The premises we have purchased the commercial space is a part of a building which does not have any association.

While purchasing the property we had a clause that we would not use the premises for a restaurant business. And this clause is there in the sale dead which we signed.

Our question: can we rent out our premises for a cafe(coffe day type) if yes, what do we need to do? If no what can we do.
Asked 1 month ago in Property Law
Religion: Hindu

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11 Answers

You cannot rent out your premises for cafe 

 

2) A café is a type of restaurant which typically serves coffee and tea, in addition to light refreshments such as baked goods or snack

 

3)  Sale deed specifically prohibits use of premises for restaurant business 

Ajay Sethi
Advocate, Mumbai
81077 Answers
5010 Consultations

5.0 on 5.0

- A cafe is a coffee shop i.e. an establishment for selling coffee and some other drinks or snacks, with a facility to consume them on the premises.

- Whereas , A Restaurant is an eating establishment in which diners are served food at their tables.

- Since, your property document having forbidden clause for Restaurant , and not for coffee house , hence you can rent the premises for the same, after clearly mention that the tenanted premises should not used for Restaurant except a coffee house. 

Mohammed Shahzad
Advocate, Delhi
6272 Answers
64 Consultations

5.0 on 5.0

A café is a small restaurant selling light meals and drinks.

You have a clause in your registered sale deed restricting you from using the premises for a restaurant business, which you have agreed and signed.

If your purchase of the property is coming with the said clause you may not be permitted to run a restaurant on your own or to let it out on rent for this purpose.

It may be objected and it may be followed by a litigation, so why do you want to invite a legal trouble. 

However you have not mentioned that why this clause was included in the sale deed by your seller, if there is any specific reason restricting you from doing the said business in the premises, you may have to either abide by the condition or consult a local lawyer with the documents to obtain a proper legal opinion on this specific clause for proceeding with the proposed lease agreement for restaurant business.

 

T Kalaiselvan
Advocate, Vellore
71133 Answers
1012 Consultations

5.0 on 5.0

Dear sir/madam,

Since this clause was mentioned in the sale deed, you can not rent it or use it for commercial purpose. But, you can have some amendment clause in the sale deed. you need to take permission from the government authorities and fulfil some legal formalities for it.

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Anik Miu
Advocate, Bangalore
515 Answers
3 Consultations

5.0 on 5.0

Would like to know the reason behind the restriction against use of the premises as a Restaurant?

Once the seller sells the place how can there be any restriction imposed on the buyer particularly when  there is no association 

It would have been understood that there was a restriction imposed against the seller by the association to not use his premises for a restaurant which would also apply to the seller's successor in interest 

But when there is no association at all then how can such a restriction be there? 

Yusuf Rampurawala
Advocate, Mumbai
5977 Answers
46 Consultations

5.0 on 5.0

Apply for trade license and permission from local Municipality.

If the Municipality permits you then irrespective of such cal sue in the deed , you can run the business.

It can be done by your own as well as through tenant . 

Devajyoti Barman
Advocate, Kolkata
22141 Answers
331 Consultations

5.0 on 5.0

Dear Sir,

You can just simply rent out the premises to run a café. Let the others complain and Court may ratify your decision since it is a long time before such clauses were mentioned in the Sale Deed which are subject to change due to development of the area.

Kishan Dutt Kalaskar
Advocate, Bangalore
5710 Answers
270 Consultations

4.8 on 5.0

Hi, when there is specific clause for not let out for restaurant then you can't let out for the same.

Pradeep Bharathipura
Advocate, Bangalore
4985 Answers
258 Consultations

4.5 on 5.0

Sir

Your query need documents inspection. I will be able to advice only after checking your documents but roughly I think that solution can be found by modifying wordings. 

Good luck. 

Gopender
Advocate, New Delhi
351 Answers

4.9 on 5.0

Dear Sir/Ma'am,

 

The general rule is that while selling the immovable property the seller cannot impose any restrictions on the manner in which such property is to be used/enjoyed by the buyer. Any such restriction is void (invalid) and cannot be enforced through the courts. 

However, a reasonable restriction can be imposed in order to secure the beneficial enjoyment of another piece of such property. (For eg. If there are two portions of the same property, in one portion, there is a coaching institute, so while renting the second portion a restriction can be imposed to not run any noisy business.)

The relevant provision of law is Section 11 of Transfer of Property Act, which reads as follows:

11. Restriction repugnant to interest created.—Where, on a transfer of property, an interest therein is created absolutely in favour of any person, but the terms of the transfer direct that such interest shall be applied or enjoyed by him in a particular manner, he shall be entitled to receive and dispose of such interest as if there were no such direction.

Where any such direction has been made in respect of one piece of immoveable property for the purpose of securing the beneficial enjoyment of another piece of such property, nothing in this section shall be deemed to affect any right which the transferor may have to enforce such direction or any remedy which he may have in respect of a breach thereof.

 

Therefore, you can rent out the premises for a cafe if it is not causing any disturbance to the neighbouring premises. You just have to execute a lease (rent) agreement specifying the terms and conditions. The onus of obtaining necessary permits from govt. bodies can be placed on the tenant. 

Hope this answer helps. 

Best wishes. 

Agam Sharma
Advocate, New Delhi
617 Answers
4 Consultations

5.0 on 5.0

You can execute a leave and license with them and do the needful

Prashant Nayak
Advocate, Mumbai
23089 Answers
49 Consultations

4.4 on 5.0

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