Promissory Note Format Pakistan

PROMISSORY NOTE (NEGOTIABLE INSTRUMENT)

Document ID: PN-2024-[Unique ID]
Effective Date: [Date]
Version: 1.0
Governing Jurisdiction: Islamic Republic of Pakistan (Punjab/Sindh/KPK/Balochistan)

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LEGAL DISCLAIMER

This document is a template drafted for general information purposes under the Negotiable Instruments Act, 1881 of Pakistan. It does not constitute formal legal advice. The user is strongly advised to review this document with a qualified legal practitioner licensed in the relevant provincial jurisdiction, particularly regarding stamp duty requirements (as governed by the Stamp Act, 1899) and registration formalities to ensure full enforceability in court.

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1. PARTIES

MAKER (BORROWER): [Full Legal Name], holder of CNIC/Passport No. [Number], residing at [Full Residential Address] ("Maker").

PAYEE (LENDER): [Full Legal Name/Company Name], holder of CNIC/NTN No. [Number], residing/headquartered at [Full Address] ("Payee").

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2. PROMISE TO PAY

For value received, the Maker hereby unconditionally promises to pay to the order of the Payee the principal sum of [Amount in PKR/USD] (the "Principal Amount"), together with interest on the unpaid principal balance at the rate of [Percentage]% per annum, calculated on the basis of a 365-day year.

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3. REPAYMENT TERMS

The Principal Amount and accrued interest shall be payable in full on [Maturity Date] (the "Due Date"). Payment shall be made via [Bank Transfer/Crossed Cheque/Pay Order] to the Payee’s designated bank account:

• Account Title: [Name]
• Account Number: [Number]
• Bank: [Bank Name & Branch]

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4. DEFAULT AND ACCELERATION

In the event that the Maker fails to pay any amount due under this Note within [Number] days of the Due Date, or upon the occurrence of an insolvency event, the Payee may, at its sole discretion, declare the entire unpaid principal balance and all accrued interest immediately due and payable.

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5. LATE FEES AND DEFAULT INTEREST

If any payment is not received within the grace period stipulated above, the Maker shall be liable to pay a late fee of [Amount] and interest on the overdue amount at the rate of [Percentage]% per month, compounded monthly, until such time as the debt is satisfied in full.

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6. PREPAYMENT

The Maker reserves the right to prepay the principal balance, in whole or in part, at any time without penalty, provided that all accrued interest is paid up to the date of such prepayment.

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7. GOVERNING LAW AND DISPUTE RESOLUTION

This Note shall be governed by and construed in accordance with the laws of the Islamic Republic of Pakistan. Any disputes arising out of this Note shall be subject to the exclusive jurisdiction of the courts of [City, e.g., Karachi/Lahore/Islamabad]. Both parties agree to attempt good-faith mediation prior to initiating formal litigation.

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8. MISCELLANEOUS

• Waiver: No failure or delay by the Payee in exercising any right hereunder shall operate as a waiver thereof.
• Entire Agreement: This Note constitutes the entire agreement between the parties regarding the subject matter hereof and supersedes all prior discussions.
• Severability: If any provision of this Note is held to be invalid or unenforceable, the remaining provisions shall continue to be valid and enforceable to the fullest extent permitted by law.

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9. EXECUTION

FOR MAKER (BORROWER): Signature: _____________________________________ Printed Name: [Name of Maker] CNIC/Passport: [Number] Date: [Date]

FOR PAYEE (LENDER): Signature: _____________________________________ Printed Name: [Name of Payee/Authorized Signatory] Title: [Role] Date: [Date]

WITNESS 1: Signature: ____________________ Name/CNIC: __________________

WITNESS 2: Signature: ____________________ Name/CNIC: __________________

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STEP-BY-STEP EXECUTION & FILING GUIDE

1. Drafting: Replace all bracketed information (e.g., [Amount], [Date]) with accurate data. Ensure the document is typed on Stamp Paper of appropriate denomination as required by the Stamp Act of your province.
2. Verification: Verify the identity of the Maker by collecting a copy of their valid CNIC. If the Payee is a corporate entity, ensure the signatory possesses a Board Resolution authorizing the execution of the Note.
3. Witnessing: Secure the signatures of two independent witnesses. Their CNIC numbers should be noted below their signatures to ensure authenticity.
4. Execution: Use wet-ink signatures for maximum enforceability in Pakistani courts. If using digital signatures (DocuSign/Adobe Sign), ensure the process complies with the Electronic Transactions Ordinance, 2002.
5. Record Retention: The original stamped physical copy must be retained by the Payee (Lender) in a secure, fire-proof location. Provide a signed duplicate copy to the Maker for their records.
6. Filing: While a Promissory Note does not strictly require registration with a registrar, if the Note is secured by collateral, it may necessitate registration with the SECP (if the Maker is a company) or the relevant land registry (if real estate collateral is involved). Consult local legal counsel if collateral is pledged.