Hire Purchase
Agreement
This Agreement is
made at ... this ... day of ... between M/s. AB & Co. Ltd., a Company
having registered office at ... hereinafter referred to as 'the Company' of the
One Part and Mr.... of... hereinafter referred to as 'the Hirer' of the Other
Part.
Whereas the Company
is the owner of certain machinery and equipment Intended for manufacturing ...
and which is more particularly described In the Schedule hereunder written.
And Whereas the Hirer
has requested the Company to give the said machinery and equipment on hire to
enable the Hirer to carry on the business of manufacturing ... with an option
to the Hirer to purchase the same.
And Whereas the
Company has agreed to do so on the following terms and conditions agreed upon
between the parties.
Now It Is Agreed by
And Between The Parties As Follows:
1.
The
Company agrees to give and deliver over to the Hirer the said machinery and
equipment described in the Schedule hereunder written on hire on the terms and
conditions hereinafter mentioned and pursuant to the said Agreement the Company
has delivered possession of the said machinery and equipment to the Hirer.
2.
The
Hirer confirms that he has inspected the said machinery and equipment before
taking possession and is satisfied that it is In good and working condition and
acknowledges delivery of the same to him by the Company and agrees to hold it
on the terms and conditions hereinafter mentioned.
3.
The
hire-purchase price of the said machinery and equipment fixed at Rs. ...
exclusive of the deposit amount mentioned in the next clause and the cost price
fixed at Rs. ... is accepted by both the parties hereto.
4.
The
Hirer has paid to the Company on the execution of this agreement a sum of Rs.
... as deposit or earnest which will be adjusted against the hire purchase
price of the said machinery and equipment, If the Hirer exercises the option to
purchase the same as hereinafter mentioned. If the Hirer does not exercise the
said option or the agreement is terminated before the exercise of such option
then the said amount of deposit will be returned to the Hirer by the Company on
the expiration or sooner determination of this agreement, subject to deduction
of any claim which the Company may have against the Hirer under or by virtue of
this agreement or in law, including the cost price of the said machinery and
equipment.
5.
During
the pendency of this agreement the Hirer shall pay to the Company by equal
monthly installments a sum of Rs. ... as hire charges, in advance, the first of
such payments to be made on the execution of this agreement and each subsequent
monthly payment will be made on or before the ... day of such each succeeding
month hereafter. The payment will be made at the registered office of the
Company by cash only or by cheque in the name of the Company.
6.
If
the Hirer fails to pay any monthly installment of hire charges on the due date
thereof then the Hirer shall be liable to pay interest thereon at the rate of
....... per cent per annum from the date of default till payment thereof. This
is however, without prejudice to the right of the Company to terminate this
agreement for default in payment of the monthly Installments as hereinafter
provided.
7.
During
the pendency of this agreement the Hirer shall keep the said machinery and
equipment in good working condition and shall maintain It properly as a man of
prudence would do and shall replace any of the parts thereof lost or disused or
out-of-use or broken.
8.
The
Hirer agrees to indemnify and keep Indemnified the Company against any loss the
Company may suffer due to any damage done to the said machinery and equipment
by any reason whatsoever.
9.
The
Company through its authorised representative shall be entitled to inspect the
said machinery and equipment during working hours at any time and for that
purpose to enter Into the premises where the said machinery and equipment will
be installed or kept and the Hirer shall allow the Company and its
representative to do so.
10.
The
Company does not give any warranty as to the quality or fitness of the mechanism
of the said machinery and equipment and will not be responsible or liable for
any defect found therein.
11.
The
Hirer proposes to install the said machinery and equipment at ....... and
agrees and undertakes not to remove the same to any other place without the
prior written consent of the Company. The Hirer shall not remove the nameplates
fixed to the machinery for the purpose of identification of the property of the
Company during the pendency of this agreement.
12.
The
Hirer shall keep the said machinery and equipment insured in the name of the
Company with any recognised Insurance Company and shall pay the premium as and
when due and payable regularly. The Policy of Insurance will be handed over to
the Company and the Hirer shall produce the premium receipt or furnish true or
Xerox copy thereof to the Company from time to time. If the Hirer fails to
insure the said machinery and equipment or fails to pay the premium at any time
the Company will be entitled to insure (without prejudice to Its other rights under
this agreement) the same or to pay the premium as the case may be and the costs
incurred by the Company will be paid by the Hirer to the Company as and when
demanded.
13.
The
Hirer shall use the said machinery and equipment for the manufacture of and not
for any other purpose without the prior consent of the Company.
14.
The
Hirer shall not give the said machinery and equipment on hire or on any other
basis or to allow it to be used by any other person without the prior written
consent of the Company and shall not hypothecate or pledge the same with any
person to secure payment of any moneys.
15.
The
ownership or property of the Company in the said machinery and equipment will
continue to remain unaffected during the pendency of this agreement and the
Hirer shall be considered as the bailee thereof with all the-duties and
obligations of a bailee in law, until the Hirer exercises his option to
purchase hereinafter provided.
16.
If
any taxes or other dues are required to be paid in respect of the said
machinery and equipment, the same will be paid by the Hirer and if any permit
or licence to use the said machinery and equipment is required to be obtained
from any Government or any local authority the same will be obtained by the
Hirer at his costs and responsibility.
17.
If
the said machinery and equipment or any part thereof goes out of order and
requires repairs of a substantial nature the work of repairs will be carried
only through a mechanic appointed by the Company and the Hirer shall pay his
charges.
18.
The
Hirer shall be liable to pay the hire charges every month not- withstanding
whether the said machinery and equipment is working or remains idle for want of
work or for any other reason.
19.
This
agreement shall be deemed to have commenced from the date hereof and will
remain in force for a period of... years from the date hereof that is up to the
day of ... and (unless the Hirer exercises the option to purchase as
hereinafter provided), on the expiration of the said period or earlier
termination thereof as hereinafter provided the Hirer shall hand over back the
said machinery and equipment in good working condition subject to normal wear
and tear at his costs at the place of business of the Company or as may be
directed by the Company provided that, the Hirer shall continue to be liable to
pay hire charges until the said machinery and equipment is actually delivered
over to or taken over by the Company.
20.
If
the Hirer commits breach of any term of this Agreement or fails to pay any two
monthly installments of hire charges, the Company will have the right to
terminate this agreement by giving one month's prior notice to that effect and
unless in the meanwhile the breach is remedied and the hire charges are paid as
the case may be. this agreement shall, on the expiration of the notice period
stand terminated. If the agreement is terminated as aforesaid the Hirer's
option to purchase as hereinafter mentioned shall stand forfeited or cancelled.
21.
If
the Hirer is adjudged insolvent or he allows the said machinery and equipment
to be attached in execution of a decree or an order of a court or for recovery
of any Government dues or if a Receiver thereof is appointed by Court or any
creditor, this agreement, on the happening of any such event shall stand
terminated.
22.
The
Hirer shall have also a right to terminate this agreement at any time by giving
not less thin fourteen days' prior notice to the company to that effect but in
such a case the Hirer will be liable to pay to the Company the amounts which
have accrued due towards hire charges have not been paid and the amount of hire
charges payable for the period from the date of termination till the stipulated
period of this agreement would expire as and by way of compensation for the
loss suffered by the Company, subject to the provisions of S. 10 (2) of the
Hire Purchase Act.
23.
On
the termination of this agreement by efflux of time or earlier termination by
the Company or the Hirer or otherwise as aforesaid, the Company shall return to
the Hirer the amount of deposit less the amounts payable by the Hirer to the
Company for hire charges or otherwise and the expenses to be paid or Incurred
by the Hirer in terms of these presents and not paid by him.
24.
If
the said machinery and equipment is lost or wholly destroyed or damaged beyond
repairs by fire, floods or earthquake or for any other reason, the Hirer shall
make good the loss suffered by the Company, the loss being the market price of
the machinery and equipment then existing or the hire-purchase price mentioned
in clause (3) above, whichever is more, Provided that, the amount of Insurance
claim received if any will be adjusted against such price.
25.
The
Hirer shall have the option to purchase the said machinery and equipment, and
the option shall be exercised by giving one month's prior notice to the
Company. The option to purchase can be exercised from the date of expiration of
the stipulated period of this agreement or from any earlier date. In the former
case the Hirer shall be liable to pay to the Company a sum equal to the Hire
purchase price of the machinery and equipment mentioned in Clause (3) above,
less the aggregate amount of installments paid up to that date or Rupee one
whichever is higher. In the latter case that is if the option to purchase is
exercised before the expiration of the period of this agreement, the Hirer
shall be liable to pay a sum equal to the said Hire-Purchase price or the
balance thereof payable by monthly installments of hire charges up to the date
of the stipulated period of the agreement as reduced by a rebate which will be
equal to two third of an amount which bears to the hire purchase charges the
same proportion as the balance of the hire purchase price not due till then
bears to the hire purchase price.
26.
On
the Hirer exercising the option and paying the price of the machinery and
equipment and other moneys as mentioned in clause (25) above to the Company the
sale of the said machinery and equipment to the Hirer shall be deemed to be
complete as on the date the option comes into operation. But until then, the
Company will continue to be the owner thereof. If, however, the Hirer fails to
pay the amount due and payable to the Company as aforesaid at or before the
date from which the option is to become effective, this agreement shall stand
terminated and the Hirer will return the machinery and equipment to the Company
forthwith in good working condition as aforesaid.
27.
Notwithstanding
the completion of sale of the machinery and equipment, the Company shall have a
lien or charge on the same for all the moneys due and payable by the Hirer
under this Agreement.
28.
The
Company declares that
a. The Hirer shall have
and enjoy quiet possession of the said machinery and equipment during the
subsistence of this agreement.
b. That the said
machinery and equipment is free from any charge or encumbrance in favour of any
third person.
c. The Company has a
right to sell the said machinery and equipment.
d. The said machinery
and equipment is new/second hand.
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
15.
16.
17.
18.
19.
20.
21.
22.
23.
24.
25.
26.
27.
28.
29.
The
Hirer shall not assign the benefits and rights under this Agreement to any
other person without the prior written consent of the Company which consent
shall not be unreasonably withheld or refused.
30.
If
on the determination of this agreement by efflux of time or otherwise, the
Hirer fails to deliver the said machinery and equipment to the Company, without
there being any dispute the Company will be entitled to file a suit or take
other proceedings to recover possession thereof and the Hirer will be liable to
pay all the costs, charges and expenses incurred by the Company, in that behalf
subject to any order of the Court.
31.
If
any dispute arises between the parties out of or in connection with the
agreement whether in the nature of interpretation or meaning of any term hereof
or as to any claim by one against the other, or otherwise the same shall be
referred to arbitration of a common arbitrator if agreed upon. otherwise to two
arbitrators one to be appointed by each party hereto and the arbitration shall
be governed by the Arbitration Act, 1940.
THE SCHEDULE ABOVE
REFERRED TO
(List /Description of
machinery & equipment)
Signed and delivered
for and
on behalf of M/s. A B
& Co. Ltd., by Mr. ... a Director of the
Company duly
authorised by a Resolution of the Board of Directors dated ...
in the presence of
...
Signed and delivered
by the with in named Hirer Mr. in the presence of ...
