DEBT SETTLEMENT AGREEMENT
BETWEEN
__________, of __________, PAN __________ (the "Lender", which expression includes the Lender's heirs, legal representatives and permitted assigns);
AND
__________, of __________, PAN __________ (the "Borrower", which expression includes the Borrower's heirs and legal representatives).
The Lender and the Borrower are each a "Party" and together the "Parties".
RECITALS
C. The Borrower cannot pay the Outstanding Amount as first agreed, and the Lender has agreed to accept the Settled Amount, on the payment terms below, in full settlement of the Original Debt.
NOW THIS AGREEMENT WITNESSES AND THE PARTIES AGREE as follows:
- 1. THE SETTLED AMOUNT
- 2. HOW THE SETTLED AMOUNT IS PAID
2.5 The Parties confirm that they have checked the current income-tax rules on payments of this kind and that the mode of payment chosen complies with them.
- 3. THE REDUCTION IS CONDITIONAL
3.1 The reduction from the Outstanding Amount to the Settled Amount takes effect only when every payment under clause 2 has been made in full and on time, or made good within the period in clause 4.1.
3.2 While the Borrower keeps to clause 2, no further interest or charges accrue on the Outstanding Amount.
3.3 The Borrower confirms that the Outstanding Amount is correctly stated and that no part of the Original Debt is disputed.
- 4. IF THE BORROWER DEFAULTS
4.3 Every payment made under this Agreement is credited against the debt in all cases and is not refundable.
- 5. RELEASE ONCE PAID
5.1 When the Settled Amount has been paid in full, the Lender releases the Borrower from every claim for the Outstanding Amount and for any interest, charges or other sums under the Original Debt, and shall not claim them again.
5.2 Within seven days after the final payment, the Lender shall give the Borrower a written no-dues letter, return every cheque, note or other security held for the Original Debt, and withdraw or not proceed with any notice or proceeding begun to recover it.
5.4 This release covers only the Original Debt. It does not affect any other dealing between the Parties, or the Parties' rights under this Agreement itself.
- 6. GENERAL
6.1 This Agreement is the whole agreement between the Parties on the settlement of the Original Debt and may be changed only in writing signed by both Parties.
6.2 Each Party enters into this Agreement freely, without pressure from the other.
6.3 If any provision of this Agreement is held invalid or unenforceable, the rest of this Agreement continues in effect. A delay by the Lender in enforcing a right under this Agreement is not a waiver of it.
- 7. STAMP DUTY
- 8. DISPUTES AND JURISDICTION
SIGNED AND DELIVERED by the LENDER
__________
PAN: __________
Signature: ______________________________
SIGNED AND DELIVERED by the BORROWER
__________
PAN: __________
Signature: ______________________________
WITNESSES