Undertaking Promissory Note Template for India

The Undertaking Promissory Note is a vital financial instrument commonly used in Indian business and personal transactions to formalize monetary obligations. It serves as documentary evidence of debt and is governed by the Negotiable Instruments Act, 1881, along with other relevant Indian legislation. This document is typically used when there is a need to formally document a promise to pay a specific sum of money, whether in business transactions, personal loans, or installment payments. The note must contain certain essential elements to be valid under Indian law, including an unconditional promise to pay, a definite sum, identification of the parties, and proper execution details. It's particularly useful in situations requiring clear documentation of debt obligations, as it provides legal recourse for the payee in case of default and can be transferred to third parties if needed.

1. Date and Place of Execution: Clear statement of when and where the promissory note is executed, which is crucial for determining jurisdiction and limitation period

2. Parties' Details: Full names, addresses, and identification details of the maker (promisor) and payee (promisee)

3. Unconditional Promise to Pay: Clear and unequivocal promise to pay a certain sum of money, including the amount in both figures and words

4. Payment Terms: Specific details about when and how the payment will be made, including due date and payment method

5. Interest Rate: If applicable, the agreed-upon interest rate and calculation method

6. Signature Block: Space for maker's signature, with revenue stamp if required by local stamp duty laws