Promissory Note Format Kerala

DEMAND PROMISSORY NOTE

Document ID: PN-KER-202X-01
Effective Date: [Effective Date]
Version: 1.0
Governing Jurisdiction: State of Kerala, Republic of India

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1. STATUTORY & LEGAL COMPLIANCE NOTICE

Legal Disclaimer: This Promissory Note is drafted in accordance with the provisions of the Negotiable Instruments Act, 1881 (Central Act No. 26 of 1881) of India, as amended, and is subject to the stamp duty requirements stipulated under the Kerala Stamp Act, 1959 (Act 17 of 1959). The Maker acknowledges that execution of this instrument requires the affixation of appropriate adhesive or impressed non-judicial stamp paper as mandated by the Kerala Stamp Act to ensure admissibility into evidence before courts of law in the State of Kerala. Legal counsel strongly advises independent verification of current stamp duty valuations prior to execution.

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2. PARTIES & RECITALS

MAKER (Debtor):
Name: [Maker Full Legal Name]
Father's/Spouse's Name: [Father/Spouse Name]
Residential/Principal Address: [Maker Principal Address]
Aadhaar / PAN / Passport Number: [Maker Identification Number]

PAYEE (Creditor):
Name: [Payee Full Legal Name]
Father's/Spouse's/Corporate Registration Name: [Father/Spouse/Entity Details]
Residential/Principal Address: [Payee Principal Address]
Aadhaar / PAN / Corporate Identification Number (CIN): [Payee Identification Number]

PRINCIPAL SUM: [Amount in INR / Currency Symbol and Numeric Value] ([Amount in Words])

Recitals:

A. FOR VALUE RECEIVED, the Maker unconditionally promises to pay to the order of the Payee the Principal Sum, together with interest accrued thereon, in strict accordance with the terms and conditions hereinafter set forth.
B. This Promissory Note is executed voluntarily, without coercion, fraud, or undue influence, within the territorial jurisdiction of the State of Kerala, India.

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3. EXHAUSTIVE OPERATIVE CLAUSES & LEGAL TERMS

Section 1: Promise to Pay & Principal Sum

1.1 For value received, the Maker hereby unconditionally, jointly and severally (if multiple Makers), promises to pay to the order of the Payee, at [Payee Payment Address or Designated Bank Account Details], the Principal Sum of [Amount in Words] ([Amount in Numerical Format]), in lawful currency of the Republic of India, upon formal demand being made by the Payee.
1.2 The debt evidenced by this Promissory Note represents a bona fide financial accommodation/loan extended by the Payee to the Maker on the Effective Date.

Section 2: Interest Rate & Accrual

2.1 The Principal Sum outstanding under this Promissory Note shall bear interest at the rate of [Interest Rate, e.g., 12%] percent per annum, calculated on the basis of a 365-day year and the actual number of days elapsed, from the Effective Date until the date this Promissory Note is paid in full.
2.2 In the event of default in payment upon demand or breach of any covenant herein, the unpaid principal and any overdue interest shall, to the maximum extent permitted by applicable Indian law, bear default interest at the rate of [Default Interest Rate, e.g., 18%] percent per annum from the date of default until the date of complete realization.

Section 3: Repayment Terms & Mode of Payment

3.1 Repayment on Demand: This is a demand promissory note. The Principal Sum, together with all accrued and unpaid interest, charges, and costs, shall become immediately due and payable in full upon the issuance of a written demand for payment by the Payee to the Maker (the "Demand Notice").
3.2 Instalment Option (If Applicable): Notwithstanding Section 3.1, if a repayment schedule is annexed hereto as Schedule A, the Maker shall make periodic instalments as specified therein. However, failure to pay any single instalment on its due date shall, at the sole discretion of the Payee, render the entire outstanding balance of principal and interest immediately due and payable without further notice or demand.
3.3 Mode of Discharge: All payments made by the Maker under this Promissory Note shall be made in Indian Rupees (INR) via Electronic Clearing Service (ECS), National Electronic Funds Transfer (NEFT), Real Time Gross Settlement (RTGS), or account payee cheque drawn on a scheduled commercial bank in India, credited directly to the designated bank account of the Payee.

Section 4: Prepayment

4.1 The Maker reserves the right to prepay the Principal Sum, in whole or in part, at any time prior to demand, without penalty, provided that any such prepayment shall be accompanied by accrued interest up to the actual date of such prepayment. Any partial prepayment shall be applied first against accrued and unpaid interest, and subsequently against the outstanding Principal Sum.

Section 5: Representations and Warranties of the Maker

The Maker hereby represents and warrants to the Payee as follows:
5.1 Legal Capacity: The Maker has full legal capacity, power, and authority to execute, deliver, and perform their obligations under this Promissory Note.
5.2 Binding Obligation: This Promissory Note constitutes a legal, valid, and binding obligation of the Maker, enforceable against the Maker in accordance with its terms.
5.3 No Conflict: The execution and delivery of this Promissory Note do not violate any existing law, regulation, court order, or contractual obligation to which the Maker is a party or by which the Maker is bound.
5.4 Solvency: The Maker is solvent, able to pay their debts as they mature, and is not executing this Promissory Note with any intent to hinder, delay, or defraud any creditor.

Section 6: Default and Acceleration Events

The occurrence of any of the following events shall constitute an "Event of Default" under this Promissory Note:
6.1 Failure of the Maker to pay any amount of principal or interest when due and upon formal demand;
6.2 Breach of any representation, warranty, or covenant made by the Maker in this Promissory Note;
6.3 The filing of a petition in bankruptcy, insolvency, or for debt restructuring or composition by or against the Maker under applicable Indian insolvency laws;
6.4 The attachment, execution, or distraint of any material asset of the Maker by any statutory authority, court, or creditor.
6.5 Upon the occurrence of an Event of Default, the Payee may, at its option, declare the entire unpaid Principal Sum and all accrued interest immediately due and payable, without presentment, protest, notice of dishonor, or further demand of any kind, all of which are hereby expressly waived by the Maker.

Section 7: Costs of Collection and Legal Expenses

7.1 If this Promissory Note is placed in the hands of an attorney for collection, or if suit is filed hereon, or if proceedings are collected through any court, tribunal, or arbitration mechanism, the Maker promises to pay all reasonable costs of collection, including legal fees, advocate fees, court costs, and administrative expenses incurred by the Payee.

Section 8: Waiver of Presentment and Notice

8.1 The Maker, and all endorsers, sureties, and guarantors hereof, hereby jointly and severally waive presentment for payment, demand, protest, notice of protest, notice of dishonor, notice of intent to accelerate, notice of acceleration, and all other notices or demands in connection with the delivery, acceptance, performance, default, or enforcement of this Promissory Note.

Section 9: Governing Law and Jurisdiction

9.1 This Promissory Note shall be governed by, construed, and enforced in accordance with the laws of the Republic of India, and specifically the statutory framework applicable within the State of Kerala.
9.2 The Maker and Payee irrevocably submit to the exclusive jurisdiction of the competent courts located in [City / District in Kerala, e.g., Ernakulam], Kerala, for the resolution of any dispute, claim, or controversy arising out of or relating to this Promissory Note.

Section 10: Miscellaneous Provisions

10.1 Severability: If any provision of this Promissory Note is held to be invalid, illegal, or unenforceable by a court of competent jurisdiction, such provision shall be modified to the minimum extent necessary to make it valid and enforceable, and the remaining provisions shall remain in full force and effect.
10.2 Entire Agreement: This Promissory Note constitutes the entire agreement between the Maker and Payee regarding the subject matter hereof and supersedes all prior oral or written negotiations, commitments, or understandings.
10.3 Amendments: No modification, amendment, or waiver of any provision of this Promissory Note shall be effective unless executed in writing and signed by both the Maker and the Payee.
10.4 Successors and Assigns: This Promissory Note shall be binding upon the Maker and their respective legal heirs, executors, administrators, and permitted assigns, and shall enure to the benefit of the Payee and their successors and endorsees.

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4. EXECUTION & FORMAL SIGNATURE BLOCKS

IN WITNESS WHEREOF, the Maker has executed this Promissory Note under hand and seal on the Effective Date first written above.

SIGNED, SEALED, AND DELIVERED
by the within-named MAKER:

Signature: _____________________________________
Printed Name: [Maker Full Legal Name]
Title / Capacity: [Individual / Sole Proprietor / Authorized Managing Partner]
Aadhaar / PAN: [Maker Identification Number]
Date: [Date of Execution]

WITNESS 1:
Signature: _____________________________________
Printed Name: [Witness 1 Full Name]
Address: [Witness 1 Address]

WITNESS 2:
Signature: _____________________________________
Printed Name: [Witness 2 Full Name]
Address: [Witness 2 Address]

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ACCEPTED AND ACKNOWLEDGED
by the PAYEE:

Signature: _____________________________________
Printed Name: [Payee Full Legal Name]
Title / Capacity: [Individual / Creditor / Corporate Representative]
Date: [Date of Acceptance]

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5. STEP-BY-STEP EXECUTION & FILING GUIDE

Step 1: Document Preparation and Customization

1. Open this document in Microsoft Word, Google Docs, or an equivalent word processor.
2. Locate all bracketed placeholders (e.g., [Maker Full Legal Name], [Amount in USD / INR], [Effective Date]) and replace them with accurate, verified factual data. Ensure numerical and written monetary amounts match identically.

Step 2: Stamp Duty Adjudication (Kerala Specifics)

1. Under the Kerala Stamp Act, 1959, promissory notes attract specific stamp duty rates based on the principal amount.
2. Procure the requisite Non-Judicial Stamp Paper (NJSP) from a licensed vendor in the State of Kerala or pay the equivalent stamp duty electronically via the Treasury Savings Bank (TSB) / e-stamping portal maintained by the Government of Kerala (e.g., via Stock Holding Corporation of India Ltd - SHCIL).
3. Ensure the stamp paper bears the name of the Maker or Payee as the purchaser to maintain evidentiary validity.

Step 3: Execution and Witnessing

1. The Maker must physically sign the Promissory Note in the presence of at least two independent adult witnesses who are not beneficiaries to the instrument.
2. Each witness must provide their complete name, residential address, and signature in the designated witness blocks.
3. If executed on physical paper, sign in blue or black indelible ink.

Step 4: Digital Execution (Optional)

1. If executing electronically, upload the finalized document to a legally compliant digital signature platform recognized under the Information Technology Act, 2000 of India (e.g., Aadhaar e-Sign or DSC-based signing portals).
2. Ensure cryptographic audit trails are retained for evidentiary verification.

Step 5: Record Retention and Post-Execution Compliance

1. The Payee must retain the original physical stamped Promissory Note in a secure, fireproof vault or safe custody, as the physical instrument (as a negotiable instrument) is generally required to be produced in court for enforcement actions under Order 37 of the Code of Civil Procedure, 1908.
2. The Maker should retain a certified true copy for their financial records.