Hello Sir,
I am Dharma Rao from Ghaziabad. Kindly give me details of Earnest Money Deposit abnk guarantee, Performance bank guarantee, security Bank guarantee and Advance Bank guarantee.
Please help me.
Thanks
Dharma
From India, New Delhi
1I am Dharma Rao from Ghaziabad. Kindly give me details of Earnest Money Deposit abnk guarantee, Performance bank guarantee, security Bank guarantee and Advance Bank guarantee.
Please help me.
Thanks
Dharma
From India, New Delhi
BANK GUARANTEES ON BEHALF OF CONSTITUENTS
DEFINITION:
As per the section 126 of Contract Act – ‘A guarantee is a contract to perform the promise or discharge the liability of a third person in case of his default’.
PARTIES TO GUARANTEE:
1. A person, who gives guarantee, is called ‘Surety’.
2. A person, on whose behalf guarantee is given, is called, ‘Principal Debtor’.
3. A person/party, in whose favour, guarantee is given, is called ‘Creditor and/or Beneficiary’.
CATEGORIES:
1. Financial guarantees :
This type of Bank Guarantee is issued by the bank and furnished by the bank’s customer in lieu of earnest money or the security to be deposited with the beneficiary of the Bank Guarantee for the performance of a contract. These guarantees, are given in lieu of purely monetary obligation e.g. the obligation of contractor make earnest money deposit/guarantees give to sale-tax department etc.
2. Performance guarantees :
These types of guarantees are issued in respect of performance of a contract or obligation. In such guarantees- in the event of non-performance or short performance of the obligation, bank will be called upon to make good the monetary lose arising out of non-fulfilment of the guarantee obligation. The bank can not perform the contract itself but by this Bank Guarantee the bank undertakes to reimburse the loss incurred by the beneficiary due to non-performance. The amount of loss to be reimbursed is ascertained at the time of default. The purpose of this Bank Guarantee is to fix the liability in the eventuality of default by the customer.
3. Deferred payment guarantees :
The bank at request of customer issues such Bank Guarantee when he purchases goods or machinaries from a creditor on the terms of payment after a specified time in lump sum or in instalments. The creditor requires such deferred payment terms to be guaranteed by the bankers of the principal debtor. Such a Bank Guarantee contain an undertaking by the banker that that deferred payment shall be made by the principal debtor, failing which the banker shall pay the amount to the creditor. These types of guarantees normally arise in the case of purchases of machinery or such capital equipment by industries or other party/ies. The manufacturer or its agent applies the machinery against cash payment say 10% to 15% & obtains accepted bills for the balance amount by purchaser’s banker for deferred period say 3 to 5 years
From India, Pune
DEFINITION:
As per the section 126 of Contract Act – ‘A guarantee is a contract to perform the promise or discharge the liability of a third person in case of his default’.
PARTIES TO GUARANTEE:
1. A person, who gives guarantee, is called ‘Surety’.
2. A person, on whose behalf guarantee is given, is called, ‘Principal Debtor’.
3. A person/party, in whose favour, guarantee is given, is called ‘Creditor and/or Beneficiary’.
CATEGORIES:
1. Financial guarantees :
This type of Bank Guarantee is issued by the bank and furnished by the bank’s customer in lieu of earnest money or the security to be deposited with the beneficiary of the Bank Guarantee for the performance of a contract. These guarantees, are given in lieu of purely monetary obligation e.g. the obligation of contractor make earnest money deposit/guarantees give to sale-tax department etc.
2. Performance guarantees :
These types of guarantees are issued in respect of performance of a contract or obligation. In such guarantees- in the event of non-performance or short performance of the obligation, bank will be called upon to make good the monetary lose arising out of non-fulfilment of the guarantee obligation. The bank can not perform the contract itself but by this Bank Guarantee the bank undertakes to reimburse the loss incurred by the beneficiary due to non-performance. The amount of loss to be reimbursed is ascertained at the time of default. The purpose of this Bank Guarantee is to fix the liability in the eventuality of default by the customer.
3. Deferred payment guarantees :
The bank at request of customer issues such Bank Guarantee when he purchases goods or machinaries from a creditor on the terms of payment after a specified time in lump sum or in instalments. The creditor requires such deferred payment terms to be guaranteed by the bankers of the principal debtor. Such a Bank Guarantee contain an undertaking by the banker that that deferred payment shall be made by the principal debtor, failing which the banker shall pay the amount to the creditor. These types of guarantees normally arise in the case of purchases of machinery or such capital equipment by industries or other party/ies. The manufacturer or its agent applies the machinery against cash payment say 10% to 15% & obtains accepted bills for the balance amount by purchaser’s banker for deferred period say 3 to 5 years
From India, Pune
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VARIOUS BANK DETAILS NAGPUR.doc
Manu-_sep-bank- hrd_142.ppt