Should a promissory note be stamped?

Pronote must be stamped with revenue stamps that are available from the post offices. In case of a pronote executed for a large sum of money, a non-judicial stamp paper can also be used. It is important for all pronote to be stamped with the proper revenue stamp or non-judicial stamp paper as per the Indian Stamp Act.

How is a promissory note stamped in India?

A promissory Note is required to be stamped in terms of Indian Stamp Act (Article 49). Please check with the latest bare Act. However, I may submit that please ensure that the Promissory Note is not witnessed. Once it is witnessed, then it would be considered tobe a bond and would attract stamp duty in terms of local Stamp Act.

Do you have to Affix Stamp on promissory note?

However, I may submit that please ensure that the Promissory Note is not witnessed. Once it is witnessed, then it would be considered tobe a bond and would attract stamp duty in terms of local Stamp Act. Section 2 (2 3) of the Indian Stamp Act 1899 makes it mandatory for affixing of stamp on any receipt as defined therein above Rs 5000 .

Can a promissory note be changed at any time?

Can a promissory note be modified? Yes, if the borrower and lender both agree, the terms can be changed at any time. For example, the borrower might ask for more time to pay in exchange for a higher interest rate.

What kind of note is a promissory note?

Section 4 of the Negotiable Instruments Act, 1881 defines Promissory note as “an instrument in writing (not being a bank note or currency note) containing an unconditional undertaking, signed by the maker to pay a certain sum of money only to, or to the order of, a certain person, or to the bearer of instrument”.

When do you pay lump sum on promissory note?

Lump sum payment at the end of the term – the Borrower pays nothing to the Lender until the end of the note term, at which time the Borrower repays the entire note in one payment.

What is the purpose of a promissory note?

A Promissory Note is an enforceable promise to pay back a loan or debt. Who is the Borrower? Who is the Lender? What is the governing law for a Promissory Note? What is the Principal amount? What is interest? What does compounded mean? What is a demand promissory note? What is the difference between a Promissory Note and a Loan Agreement?

What are the alternative names for promissory notes?

Alternative names for promissory notes include: IOU, personal notes, loan agreements, notes payable, note, promissory note form, promise to pay, secured or unsecured notes, demand notes, or commercial paper. As such, a promissory note must contain the usual standard requirements for a contract, including consideration,…