A Municipal Board, under a resolution, gave possession of land to 'X' and 'Y' with a right to make construction on the said land subject to a condition that after the termination of a lease, the construction shall belong to the Municipal Board. 'X' and 'Y' accepted the condition and made construction on the land. The effect of the resolution and acceptance was to create -

Correct option is C

The effect of the resolution and acceptance was to create a licence. A licence allows the use of property without transferring any interest in it, and 'X' and 'Y' merely had the right to use the land for construction with the condition that the building would revert to the Municipal Board after the lease.
Information Booster:
A licence is permission to do something on immovable property that would otherwise be illegal, without transferring any property rights.
Additional Knowledge:
· Lease: This would involve the transfer of a right to enjoy the property.
· Usufructuary mortgage: Involves the transfer of possession for a mortgage.
· Easement: Grants a right over another’s property but not ownership.