LEASE DEED FOR EOUIPMENT LEASE
THIS DEED of Lease is made at??????.this??????.day of????20..between A B Co. Ltd., a company incorporated under the Companies Act, 1956 and having its registered office at................... hereinafter called "the Lessee" (which expression shall, unless It be repugnant to the context or meaning thereof, mean and Include its successors and assigns) of the ONE PART and M/s X Y, a partnership firm carrying on business at??????.through their present partners (i) ??????.(ii) ??????.(iii) ??????.(iv) ????? hereinafter called as "the Lessee" (which expression shall, unless it be repugnant to context or meaning thereof, mean and include all the partners for the time being and from time to time and their respective heirs ,legal representatives, administrators, executors and assigns) of the OTHER PART,
(1) In base, unless the context otherwise so requires, the following expressions shall have the following meanings viz.:
(a) The commencement date shall be the date of delivery of the equipment by the manufacturer to the Lessee.
(b)The equipment, described in the Schedule hereunder written, purchased by the Lessor at the request of the Lessee from the manufacturer for the use of the Lessee and includes all alterations, replacements and/or additions during the term of the lease.
(c) The fixed period of the lease as defined in the Schedule hereunder written, which is not cancellable by the Lessor and/or the Lessee except as provided in clause??????. hereof.
(d)Manufacturer means X Y Co. Ltd . ....................
(e)Person includes any person (natural or judicial), partnership firm, association of persons and body corporate.
(f) "Schedule" means the Schedule hereunder written and will be treated as part of this lease.
(2) The Lessor hereby grants lease and the Lessee takes on lease, the equipment for the fixed period with effect from the commencement date subject to the terms and conditions, covenants and agreements herein contained on part of the Lessee to be observed and performed.
(3) The Lessee shall pay to the Lessor the lease management fee and deposit specified, in the Schedule and pay lease rentals without any deduction or abatement from the commencement date on the dates as specified in the Schedule. If the lease rentals of the fixed period in the event of the Lessee being in arrears of such monthly rentals, such arrears of lease rentals shall carry interest at the rate of ??.% per annum from the due date specified in the Schedule till date of actual payment.
(4) The Lessee hereby acknowledges, agrees, declares and confirms that
(i) The Lessee has selected the equipment and the manufacturer both based on the Lessee's own judgment and the Lessor has not made any statements or representations about the equipment
(ii) The Lessor is neither a dealer nor a manufacturer, and he has not made warranties, express or implied as to any matter whatsoever including the condition, fitness or merchantability of the equipment or its suitability for any purpose.
(iii) The lessor shall in no way be liable or responsible to the lessee for any liability, claim, loss, damage or expense of any kind or nature whatsoever arising out of transportation, delivery, storage, installation, use or operation or its failure to operate or perform or otherwise, howsoever.
(iv) The lessor hereby assigns to the lessee the right to make any claim or demand for any defect, deficiency or claim of any breach of condition or warranty against the manufacturer, but no such defect or deficiency or breach of the manufacturer's condition or warranty shall affect the, lessee's duty to pay the rent and perform the obligations hereuinder.
(5) The lessee shall throughout the term of the lease:
(i) Pay punctually and regularly lease rentals, and all the rates, taxes, licence fees, surcharge, registration charges and outgoings payable in respect of the equipment or the storage, installation, use or operation thereof or of the premises where the said equipment is kept and shall on demand produce to the lessor all receipts of such payment.
(ii) Keep the equipment in good and serviceable repair and condition (wear and tear excepted).
(iii) Keep the equipment in its control at the location specified in the Schedule and not to remove the same therefrom, except for the purpose of repair, without the prior written permission of the lessor.
(iv) Not to affix, fasten, anchor or attach or cause to be affixed the equipment to any immovable property.
(v) Affix a name plate or other mark on the equipment identifying the sole and exclusive ownership thereof of the lessor and not allow or permit the same to be removed or defaced during the term.
(vi) Use and operate the equipment carefully and maintain the same in good working condition and repair at its own cost and expenses in accordance with the instructions given by the manufacturer for the operation and use of the equipment.
(vii) Insure the equipment with an insurance company in the joint names of the lessor and the lessee for its full replacement made against all risks including fire, riot, lightening, explosion, earthquake, strike, storm, tempest, flood, war, theft, civil commotion and such other risks as the lessor may require and shall punctually pay all premiums payable thereunder and produce the receipts of such payments to the Lessor on demand.
(viii) If the equipment is damaged during the term of the lease and any claim is received from the insurance company, and if in the opinion of the lessor it is economical that such damage be made good by the amount received from the insurance company, then the said sum shall be applied in making good the said damage to the equipment. However, if the equipment is damaged in such a manner or lost, stolen or destroyed completely and in the opinion of the lessor, it is not economical to repair the equipment, then the lease shall stand terminated on the date of the receipt of the insurance moneys by the lessor and the money received from the insurance company shall be received by the lessor and shall be applied towards the liability of the lease rentals payable on that date, such value to be calculated as on that date at a discount rate of 10% per annum and deficit shall be paid by the lessee and if there is any surplus, the same shall be paid by the Lessor to the Lessee.
(ix) Permit the Lessor or any person duly authorised by him at all reasonable hours to I nspect the state and condition of the equipment and for that purpose to enter the premises where the equipment is stored, used, or lying.
(x) Not to sell, assign, sub-let, pledge, mortgage, charge, hypothecate, sub-lease, encumber or part with possession of or otherwise deal with the equipment or any interest therein or otherwise in any manner part with the possession of the equipment or purport to allow or create any lien, charge, attachment or other claim or whatsoever whether for repairs or otherwise and in the event of any breach of this clause, by the Lessee, the Lessor shall be entitled (but shall not be bound) to pay to any third party such sum as is necessary to procure the release of the equipment from any charge, encumbrance, hypothecation, or lien and in such case the Lessee shall be liable to reimburse the said amount to the Lessor forthwith.
(xi) Indemnify and keep indemnified the Lessor against any claim, costs, expenses, damages, liabilities, or proceedings arising from or pertaining to the transportation, storage, use, operation of the equipment and against any loss or seizure of the equipment under distress, execution or other legal process or destruction or damage to the equipment by any reason whatsoever.
(xii) Reimburse to the Lessor any tax, duty, charges, or duties or other sum, that the Lessor may have to pay to the Government, Municipal, local or statutory authority regarding the storage, installation, use or operation of the equipment or any lease rentals including sales tax.
(xiii) Obtain and keep in force all licences, permissions and registration for the storage, installation, use and operation of the equipment and furnish the same to the Lessor on demand.
(xiv) Not to claim any relief by way of deduction or allowance under Income-tax Act or any other statute, rules or regulations available to the owner of the equipment and not to do or omit to be done any act, deed or thing whereby the Lessor is deprived to claim relief by way of deduction or allowance, as the owner of the equipment under the Income-tax Act and the lessee shall furnish to the Lessor. such information as it may require to claim relief or allowance and to comply with all the terms and conditions to be complied with or observed in respect of the use and operation of the equipment to entitle the lessor to obtain such relief.
(xv) Furnish its audited balance sheet and Profit and Loss Account to the Lessor and such other information as may be required by the Lessor from time to time.
(xvi) Without the written consent of the Lessor, not to make any additions, improvements or alterations to the equipment or working order, function or quality thereof.
(6) The Lessee hereby confirms and declares that the Lessor is and shall at all times remain the absolute owner of the equipment and the Lessee shall have no right, title or interest therein except as provided hereunder.
(7) (i) The Lessee shall be liable to pay all taxes, charges, duties and outgoings from time to time to the Government, Municipal, local or any statutory authority pertaining to the use, operation or in respect of this lease including the interest and penalties that may have to be paid for non-payment of such taxes, charges, duties and other outgoings
(ii) If the Lessee fails to pay the above taxes, charges, duties and outgoings, the lessor may pay the same and the Lessee shall reimburse the sums so paid together with interest at the rate of ??????.% per annum from the date of payment to the date of such reimbursement.
(8)(i)The lease rentals herein have been fixed on the basis of bank lending rate at the rate of ??????. % and in the event of such rate being increased or decreased, the lease rentals herein shall be increased or decreased from the date of such changes in the interest rates.
(ii) The lease rentals hereunder have been fixed on the basis that depreciation at the rate of ??? % WVD basis on the leased asset is available to the Lessor and if such rate changes or the depreciation is not available to the Lessor due to change in income-tax law; the lease rentals shall be increased or decreased, so that the post-implicit rate of return for the Lessor may remain ???.%.
(9) If the Lessee having regularly paid the lease rentals and observed and performed the covenants and stipulations laid down hereunder, shall desire to renew this lease by giving a notice at least .......... months prior to the date of expiry of the term, the Lessor shall grant the renewal of further lease for a further period of ???years from the date of expiry of the term, on the rentals specified in the Schedule hereunder for the renewed period of lease.
(10) If the Lessee
(i)fails to pay the rent payable hereunder after the same becomes due and payable or any other sums and monies due and payable under this lease agreement;
(ii)fails to perform or observe all the covenants and stipulations hereunder or commits breach of any of the conditions hereunder;
(iii)attempts to sell, convey, transfer, encumber, hypothecate or part with the possession or control of the equipment;
(iv)suspends or discontinues the business or dissolution or winding up proceedings of the Lessee are initiated;
(v)enter into compromise arrangement or composition with its creditors or any assignment for the benefit of such creditors;
(vi)shall abandon the equipment;
(vii) makes default of any other agreement executed between the parties supplemental to this lease deed;
the Lessor may forfeit all the lease rentals, security deposit or any other sum paid by the Lessee under this Agreement and demand the Lessee to return the equipment and in case of failure of the Lessee to do so within days of demand, and without any prior notice or demand take possession of the equipment and to terminate the lease hereby created and to sell the equipment at public or private auction or lease or hire to any other person or use or dispose off the equipment as owner and the Lessee shall be liable to pay all the sums payable to the Lessor as on the date of termination and full amount of the stipulated loss value in addition to the compensation for losses and damages, caused to the Lessor
by such default.
(11) The Lessee shall pay to the Lessor deposit of six months lease rentals, which shall be retained by him and shall be dealt with in the following manner:
(i) For the due observance and performance of the covenants, stipulations, terms and conditions by the Lessee of this lease agreement and shall be returned to the Lessee without any interest on the termination of lease agreement, less such sums as may then be due to the Lessor under the terms of the lease agreement.
(it) If the Lessee commits any default under any of the provisions of this lease agreement, then to apply for the deposit or part thereof against all and any monies, damages, arrear of rent and/or stipulated loss value as the Lessor thinks fit.
(12) (i) The Lessor is entitled, without the consent of the Lessee;
(a) to transfer, pledge, or create charge or mortgage the equipment subject to this agreement;
(b) to transfer, or pledge all or part of its rights and obligations under this agreement or use the equipment as security;
(ii) the Lessee shall not be entitled to assign its rights and obligations hereunder to any party and lease rentals or any sums payable by the Lessee cannot be set-off with any claim, against the Lessor or its successors or assigns.
(13) Upon the expiration or sooner determination of this lease agreement for any reason whatsoever, the Lessee shall at its own cost deliver the equipment in good and tenantable condition to the Lessor at the address of the Lessor stated in this agreement or at such other address as the Lessor may specify and in default by the Lessee, the Lessor or its servants or agents may without notice re-take possession of the equipment and may for that purpose enter upon any premises in which the equipment is believed by the Lessor or its servants or agents to be situated and if the equipment or any part thereof is affixed to land or building, the Lessor or its servants or agents may sever the same therefrom and remove the equipment or part thereof so severed, the Lessee shall be liable to pay all costs and expenses incurred by the Lessor in connection with taking of re-possession of the equipment.
(14) Any forbearance, delay or indulgence on the part of the Lessor in enforcing any of the terms and conditions of this lease agreement or the granting of time by the Lessor to the Lessee shall not prejudice or affect the rights of the Lessor hereunder. Any waiver by the Lessor of any breach hereof shall also not operate as a waiver of any subsequent or any continuing breach thereof.
(15) If any dispute or question shall arise between the parties in relation to any rights or liabilities hereunder, the same shall be referred to two arbitrators or their umpire pursuant to the Arbitration Act, 1940 or any then subsisting statutory provisions relating to arbitration.
(16) Any notice required to be given to the Lessor shall be duly served if sent by registered post addressed to the Secretary of the Lessee at the address given above and any notice to the Lessee shall be duly served if sent in like manner addressed to him at the address given above.
(17) If the lease is terminated within two years of the commencement date and the Lessor incurs an additioneJ liability for income-tax, the Lessee shall indemnify the Lessor for any additional amount of income-tax for which the Lessor becomes so liable.
(18) This lease agreement shall be binding on the successors and assigns of the Lessors and Successors and permitted assigns of the Lessee
(19) This Lease Deed shall be executed in duplicate. The original shall be retained by the Lessor and the duplicate by the Lessee.
(20) The stamp duty and all other expenses in respect of this Lease Deed and duplicate thereof shall be borne and paid by the Lessee.
(21) The headings to the clauses of this agreement are meant only for convenience of reference and shall not in any way be taken into account in the interpretation of these presents.
IN WITNESS WHEREOF, the Lessor hereto has caused these presents and the said duplicate to be signed on its behalf r by its duly authorised official and the Lessee has signed these presents and a duplicate hereof on the day and year first hereinabove written.
The Schedule above referred to
WITNESSES
1 Signed and delivered by the within named A B Co. Ltd., the Lessor by the hands of its authorised officer
Shri??????.(Name and Designation).
2 Signed and delivered by the within named X Y, the Lessee by their partners.