Page 180 - DMGT512_FINANCIAL_INSTITUTIONS_AND_SERVICES

Unit 11: Leasing

But in India, the tax benefits given to the leasing companies are not substantially as good Notes
as their counterparts in developed economies.

11.7 Keywords

A contract of Indemnity: A contract whereby a person promises to make good the loss caused to
him by the conduct of the promisor himself or any third person.
Contract: A contract is an agreement enforceable by law.

Lease: Lease is a contract conferring a right on one person (called a tenant or lessee) to possess
property belonging to another person (called a landlord or lessor) to the exclusion of the owner
landlord.

11.8 Self Assessment

Fill in the blanks:
1. The 46th Amendment to the Indian Constitution, has empowered the State Governments
to levy sales tax on the ............................ of rights.

2. The tax benefits which leasing companies enjoy in the developed countries are
............................ to the Indian leasing companies.
3. To, take a decision whether to finance a lease or lease an asset, the lessor/financier requires
a lot of commercial document of the .....................
4. The provisions of the ................................ relating to bailment are specifically applicable to
leasing contracts.
5. In an import lease, the lessor and the lessee are domiciled in the ........................ country.
6. A contract of guarantee is a contract, whether oral or written, to perform the promise or
discharge the liability third person in case of his ............................ .
7. A lease can be for a fixed period of time but may be terminated ............................ .
8. The ............................ is the receiver of the services or the assets under the lease contract.
9. A Finance lease is mainly an agreement for just financing the ............................, through a
lease agreement.
10. An ............................ lease is one in which the lessor does not transfer all risks and rewards
incidental to the ownership of the asset and the cost of the asset is not fully amortized
during the primary lease period.

11. In ............................ type of lease, the owner of an equipment/asset sells it to a leasing
company which leases it back to the owner.
12. In ............................ lease, the lessee and the owner of the equipment are two different
entities.
13. In Tripartite lease there are three different parties, viz. ............................, ............................
and ............................ .

14. Single investor lease is a bipartite lease in which the ............................ is solely responsible
for financing part.
15. A lease transaction is classified as ............................ if all the parties to such agreement are
domiciled in the same country.

LOVELY PROFESSIONAL UNIVERSITY 175