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Free Promissory Note Template for India
Create a legally enforceable Promissory Note in India governed by the Negotiable Instruments Act 1881. Our template covers demand notes, instalment notes, interest provisions, stamp duty requirements, and enforcement options including civil suit and cheque security under Indian law.
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PROMISSORY NOTE
25 April 2026 · New Delhi, India
NIA 1881 s. 4 · Payable on Demand
₹ 5,00,000
25 April 2026 · New Delhi, India
(Rupees Five Lakhs Only)
I / We, Suresh Ramakrishnan Iyer, residing at B-14, Hauz Khas Enclave, New Delhi - 110 016, Delhi (NCT) (PAN: ABCSI1234F), do hereby unconditionally and irrevocably promise to pay to Rajiv Anand Sharma, residing at 45, Lajpat Nagar II, New Delhi - 110 024, Delhi (NCT), or order, on demand, the sum of 5,00,000.00 INR (Rupees Five Lakhs Only), without interest.
This Promissory Note is executed at New Delhi, Delhi (NCT), on 25 April 2026, and shall be governed by and construed in accordance with the Negotiable Instruments Act, 1881 ("NIA 1881"), the Indian Contract Act, 1872, and the laws of the Republic of India.
This Promissory Note is executed at New Delhi, Delhi (NCT), on 25 April 2026, and shall be governed by and construed in accordance with the Negotiable Instruments Act, 1881 ("NIA 1881"), the Indian Contract Act, 1872, and the laws of the Republic of India.
Elements of this Promissory Note (NIA 1881 s. 4): (i) this note is in writing; (ii) it contains an unconditional undertaking to pay; (iii) it is signed by the Maker; (iv) it promises payment of a certain sum of money only; (v) payment is to be made to a certain person (the Payee) or order. This note is not a bank-note or currency note and constitutes a valid promissory note within the meaning of s. 4 of the NIA 1881.
Stamp Duty Notice: This instrument is liable to stamp duty under the Indian Stamp Act, 1899 ("ISA 1899"). Applicable stamp duty must be paid by affixing adhesive stamps of the correct denomination, or by franking, before execution of this note in Delhi (NCT). The rate of stamp duty on promissory notes is typically ₹1 for every ₹1,000 of the face value (or part thereof), subject to the applicable State Stamp Act and Schedule I to the ISA 1899. An unstamped or insufficiently stamped promissory note is not admissible in evidence in any Indian court (ISA 1899 s. 35).
Limitation: The right to enforce payment of this Promissory Note is subject to the Limitation Act, 1963. A suit to enforce a promissory note must be filed within three (3) years from the date the note falls due (i.e., date of demand or the specific payment date, as applicable). The Payee is advised to take prompt action upon default to preserve rights under this note.
MAKER / BORROWER (SIGNATURE)
PAN: ABCSI1234F, B-14, Hauz Khas Enclave, New Delhi - 110 016, Delhi (NCT), Phone: +91 98765 43210
Suresh Ramakrishnan Iyer
Date: ____________________
Witnesses (recommended — not required by NIA 1881 but aids enforceability):
Witness 1:
Name: ___________________________
Address: ___________________________
Signature: ___________________________
Witness 2:
Name: ___________________________
Address: ___________________________
Signature: ___________________________
Witness 1:
Name: ___________________________
Address: ___________________________
Signature: ___________________________
Witness 2:
Name: ___________________________
Address: ___________________________
Signature: ___________________________
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What Is a Promissory Note in India?
A Promissory Note is a written, unconditional promise by one person (the maker) to pay a specified sum of money to another person (the payee) on demand or at a fixed or determinable future date. In India, promissory notes are governed by the Negotiable Instruments Act 1881 (NIA), which defines a promissory note as an instrument in writing (not being a bank note or a currency note) containing an unconditional undertaking signed by the maker to pay a certain sum of money only to, or to the order of, a certain person, or to the bearer of the instrument. The NIA 1881 provides detailed rules on the creation, transfer (endorsement), and enforcement of promissory notes in India.
Promissory notes are widely used in India for documenting personal loans, business transactions, purchase of goods on credit, and as part of commercial lending arrangements. They provide a simple, standardised way to record a debt obligation without the full complexity of a loan agreement. A promissory note signed by the maker and properly stamped is strong evidence of the debt in Indian courts and significantly simplifies the recovery process — the creditor need only prove the note was made and remains unpaid, without having to prove the full circumstances of the underlying transaction.
In India, a promissory note must be stamped under the Indian Stamp Act 1899. The stamp duty is typically calculated on the principal amount of the note. An unstamped promissory note is inadmissible as evidence in Indian courts until the deficit stamp duty and penalty are paid, which can severely hamper recovery efforts. Interest on promissory notes is permissible and enforceable — Indian courts routinely award interest at the contracted rate, or at a reasonable rate under the Interest Act 1978 if no rate is specified. Promissory notes can also be endorsed and transferred to third parties under the NIA 1881, making them a negotiable instrument in the strict legal sense.
What's Covered in This Promissory Note Template
Our India-specific Promissory Note template covers all essential NIA 1881 requirements and practical provisions.
Maker & Payee Details
Identifies the maker (borrower/promisor) and payee (lender/promisee) with full legal names, addresses, and PAN for large value notes.
Unconditional Promise to Pay
Contains the NIA 1881 mandatory unconditional promise language — "I promise to pay" — without any condition that could invalidate the note as a negotiable instrument.
Principal Amount in ₹
States the principal sum in Indian Rupees in both figures and words, as required for a valid promissory note under the NIA 1881.
Payment Date — Demand or Fixed
Specifies whether the note is payable on demand or on a fixed date, or in instalments — covering both demand notes and time notes under NIA 1881.
Interest Rate
Specifies the annual interest rate on the principal from the date of the note until full payment, enforceable under the Interest Act 1978 and Indian Contract Act 1872.
Place of Payment
States the place at which payment is to be made, which determines the jurisdiction of the court for recovery proceedings in India.
Stamp Duty Reference
Notes the obligation to affix the appropriate adhesive stamp or execute on stamp paper under the Indian Stamp Act 1899 based on the principal amount.
Endorsement Provisions
Includes the endorsement format for transfer of the promissory note to a third party (endorsee) under the NIA 1881.
Default & Demand Clause
For demand notes, includes a demand clause that triggers the payee's right to sue for the full amount immediately upon demand and non-payment.
Maker's Signature
Provides the maker's signature space — the NIA 1881 requires the note to be signed by the maker for validity as a negotiable instrument.
How to Create a Promissory Note in India
Follow these steps to create a legally valid promissory note under the NIA 1881.
- 1
Determine Payment Terms
Decide whether the note is payable on demand or on a specific date. For instalment repayments, consider a loan agreement instead of a promissory note to accommodate the full repayment schedule.
- 2
Draft the Note
Include all NIA 1881 mandatory elements: the unconditional promise to pay, the principal amount in figures and words, payee name, payment date, place of payment, and interest rate.
- 3
Stamp the Note
Affix the appropriate revenue stamp (adhesive stamp) or execute the note on stamped paper under the Indian Stamp Act 1899. The stamp duty rate on promissory notes is based on the principal amount and the state.
- 4
Maker Signs the Note
The maker (the person promising to pay) must sign the promissory note. The NIA 1881 requires the maker's signature for the document to be a valid promissory note. The payee does not need to sign.
- 5
Retain the Original
The payee retains the original promissory note. If the maker repays the full amount, the payee should return the original note (marked as discharged) or provide a formal discharge receipt.
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Legal Considerations for Promissory Notes in India
These are the key Indian legal requirements for creating and enforcing a promissory note.
This template is for informational purposes only and does not constitute legal advice. Consult a qualified Indian advocate or legal practitioner for advice specific to your situation.
Reviewed for Indian law
Negotiable Instruments Act 1881
The NIA 1881 defines a promissory note and sets out the requirements for its validity as a negotiable instrument. Key requirements include: (1) the promise must be unconditional; (2) the amount must be certain; (3) the payee must be identifiable; and (4) the note must be signed by the maker. A conditional promise or a note for a variable sum is not a valid promissory note under the NIA 1881 and loses the benefit of negotiable instrument law.
Stamp Duty Under the Indian Stamp Act 1899
Promissory notes attract stamp duty under the Indian Stamp Act 1899 (Article 49 of Schedule I). The duty is calculated on the principal amount and varies by state. Adhesive revenue stamps of the appropriate denomination must be affixed to the note and cancelled by the maker's signature. An unstamped promissory note is inadmissible as evidence in Indian courts — a critical issue if the maker defaults and the payee seeks recovery.
Limitation Period for Promissory Notes
Under the Limitation Act 1963, the limitation period for filing a suit on a promissory note is three years — from the date the note falls due (for time notes) or from the date of the demand (for demand notes). Once the limitation period expires, the right to sue on the note is barred. Payees should take prompt action if the maker defaults.
Cheque Dishonour — NIA Section 138
Where a cheque is given as payment (or security) for a promissory note or loan, and the cheque is dishonoured on presentation, Section 138 of the NIA 1881 creates a criminal offence. The payee must send a demand notice within 30 days of dishonour. Criminal liability (imprisonment up to two years, fine, or both) significantly strengthens the payee's position in Indian debt recovery proceedings.
Frequently Asked Questions
Create a Legally Valid Promissory Note for India
Use Doxuno's free Promissory Note template to document a debt obligation under the NIA 1881. Stamp it, sign it, and protect your right to recover what you are owed under Indian law.
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