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THIS AGREEMENT made at ........................ (Give place) this......................... (Give date) day of.......................... (Give month) 200 ........................(Give year) Between..............................(Give name) a company incorporated under the Companies Act, 1956, and having its registered office at........................(Give address) (Hereinafter called "the Owner") of the FIRST PART and Shri................son of ..................resident of .............................(Give details) (hereinafter called "the Hirer") of the SECOND PART and Shri A son of...................... resident of............................. (Give details) (Hereinafter called "the Surety") of the THIRD PART.

WHEREAS

1. The hirer has vide his letter dated............... (Give date) requested the owner to provide finance for the purchase of … (Give details)

2. The owner has by its reply dated........................ (Give date) agreed to provide finance for the purchase of …on the terms and conditions laid down in the said letter and the documents to be executed for the said purpose.

3. The hirer has placed an order with M/s............................ (Give name) for the purchase of.........................

4. The owner has provided the finance by making payment of an amount of Rs.… (Give amount) vide cheque No.................... dated..................... drawn on................ (Give details) to the supplier......................... (Give name)

NOW IT IS AGREED BY AND BETWEEN THE PARTIES AS FOLLOWS:

1. The owner, shall let and the hirer shall take on hire from the............................(Give date) day of..........................(Give month) the.......................... with fittings, tools, and accessories, more particularly described in the Schedule hereto

2. On execution of these presents, the hirer shall pay a sum of Rs.................. (Give details) to the owner as initial payment by way of hire and shall during the continuance of this agreement pay to the owner at his address by way of rent for the hire of the said.......................... the monthly sum of Rs...................... (Give details)

3. The first payment is to be made on the........................ (Give date) Day of...................(Give month) and the next and each subsequent payments on the…. (Give date) Day of each succeeding month during the said term.

4. During the continuance of the agreement, the hirer shall-

1. not sell or offer for sale, assign, mortgage, pledge, underlet, let or otherwise deal with the said.......................... or any part or parts thereof or with any interest therein;

2. keep the said................... in his own possession and will not remove the same or any part or parts thereof from the place where such ………. is for the time being situated without the previous consent in writing of the owner;

3. not allow any lien to be created upon the said ...........................whether for repairs or otherwise and will duly and punctually pay all rents, taxes, rates, charges and levies payable in respect of the premises wherein the said ........................shall for the time being be situated and produce all receipts for such payment to the owner on demand and will protect the said … against distress, execution or seizure;

4. use the ...........................in a skilful and proper manner and shall at his own expense keep the said .......................... in good and substantial repair and condition (reasonable wear and tear excepted);

5. keep insured the .............................. during the period of hiring against any loss or damage by hire or otherwise in the sum of Rs....................... (Give sum) with an insurance company in the name of the owner and deliver the policy of such insurance to the owner and duly and punctually pay all premiums necessary for keeping the said insurance effective throughout the period of this agreement:

Provided that in case the hirer shall at any time fail to effect or keep effect the said policy by making default in any payment of premium, the owner shall be entitled to effect such insurance and pay the premium to the said insurance company and the hirer shall forthwith pay to the owner all the premiums and other sums paid by the owner;

6. not do or omit to do any act which may result in seizure and/or confiscation of the .......................by the Central or State Government or local authority or any public officer or authority under any law for the time being in force.

5. If the said .................................. shall be destroyed or damaged by fire or otherwise, all moneys received or receivable in respect of such insurance as aforesaid shall forthwith be received by the owner who shall as the case may require, apply such money either in making good the damage done or in replacing the said..................................... by other articles of similar description and value and such substituted articles shall become subject to the provisions of this agreement in the same manner as the articles for which they shall have been substituted.

6. The hirer may determine the hiring at any time by giving............................ (Give no.) days notice in writing to the owner at his address for the time being and by returning the said ............................ at the hirer’s own risk and expense and shall thereupon forthwith pay to the owner all hire charges upto the date of such determination and other sums due under the agreement and 25% of the balance of the total hire charges still to fall due as settled compensation.

7. If the hirer shall make default in punctual payment of the monthly sum so to be paid by him for the hire of the said............................... or fails to perform the terms and conditions of this agreement on his part to be observed and performed or if the hirer shall do or cause to be done or permit or suffer any act or thing whereby the owner’s rights in the said......................... may be prejudiced or put in jeopardy, the owner may without notice determine the hiring and it shall thereupon be lawful for the owner to take possession of the said..................... and for that purpose to enter into or upon any premises where the same maybe kept. If the agreement is determined before the property in the said........................ passes to the hirer, the hirer shall forthwith return to the owner, policies and other documents relating to the said ........................

8. If the hirer shall duly perform and observe all the terms and conditions in this agreement and the covenants on his part to be performed and observed and shall punctually pay to the owner the sums specified in clause 2 hereof amounting (together with the said sum of Rs..................... (Give details) so paid on the execution of this agreement as aforesaid) to the sum of Rs........................ (Give details) then the hiring shall come to an end and the said.................... shall become the property of hirer and the owner will assign and make over all his rights, title and interest in the same to the hirer but until such payments have been made, the.......................... shall remain the property of the owner.

9. In consideration of the owner letting the said.................... to the hirer at the rent and under the agreements and conditions hereinbefore expressed, the surety hereby guarantees the due payment of the said rents and all other sums of money which may become payable under this agreement and the performance and observance of the said agreements and conditions by the hirer and this guarantee shall not be prejudiced by the owner neglecting or forbearing to enforce this agreement against the hirer or giving time for the payment of the said rents when due or delaying to take any steps to enforce the performance or observance of the said agreements or conditions or granting any indulgence to the hirer.

10. The parties to this agreement hereby declare that they have fully understood the meaning of all the clauses, terms and conditions of this agreement and they have accepted and executed this agreement with full knowledge and understanding of the obligations herein.

IN WITNESS WHEREOF, the parties have executed this agreement on the day and the year first hereinabove written.

The Schedule above referred to :(Particulars of the…)

Read more about HIRE PURCHASE