Essential Elements Of Bond

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Meaning of Bond: A bond is an instrument in which a person binds himself to another person for the

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Essential Elements Of Bond :

Essential Elements Of Bond

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Meaning of Bond: A bond is an instrument in which a person binds himself to another person for the payment of a certain sum of money at a future date. The person who binds himself is called the obligor and the person to whom he is bound is known as oblige . Definition of Bond: Section 2(5) of the Indian Stamp Act, 1899 states that bonds include (a) any instrument, whereby a person obliges himself to pay money to another, on condition that the obligation shall be void if a specified act is performed, or is not performed; (b) any instrument attested by a witness, and not payable to order or bearer, whereby a person obliges himself to pay money to another; and (c) any instrument so attested, whereby a person obliges himself to deliver grain or other agricultural produce to another. Section 2(d) of the Indian Limitation Act provides that Bond includes any instrument whereby a person obliges himself to pay money to another on condition that the obligation shall be void, if a specified act is performed or is not performed.

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Essential elements of Bond: A bond should satisfy the following conditions : It must be in writing and signed by the obligor . b. It should be attested by one witness . c. The obligor should unconditionally promise to pay an ascertained sum of money or to deliver a certain amount of grain or agricultural produce . Execution , Stamp Duty & Registration: The bond should be signed by the executant in the presence of at least one witness, who should sign in the presence of the executant .

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The rate of stamp duty varies from State to State. The stamp duty on the Bond is payable under Article 15 of the Schedule I of the Indian Stamp Act. The bond is not required to be registered, but if the bond itself creates an interest in immovable property of the value of Rs. 100 and upwards, it is required to be registered under section 17(l)(b) of the Registration Act . The following Bond is available on our website : Employee Bond: - The draft employee bonds needs to be executed where an employee agrees to stay for a prescribed period. The employer is imparting training and employee agrees to stay for a minimum period say one year . To know more about HR policies of companies in India, be sure to check out this site.

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