No Dues Certificate Format

No dues certificate format (unconditional)

Use this version only when every rupee has been received and realised: cheques cleared, bank transfers credited, TDS reflected in Form 26AS.

[YOUR COMPANY NAME]
[ADDRESS] | GSTIN: [YOUR GSTIN]

Date: [DATE]

TO WHOMSOEVER IT MAY CONCERN
(or) To, [CUSTOMER NAME], [CUSTOMER ADDRESS]

NO DUES CERTIFICATE

This is to certify that [YOUR COMPANY NAME], GSTIN [YOUR GSTIN], has received from [CUSTOMER NAME], GSTIN [CUSTOMER GSTIN], the full payment of all amounts due against [Purchase Order No. [PO NO.] dated [PO DATE] / Contract No. [CONTRACT NO.] / invoices numbered [FIRST INVOICE NO.] to [LAST INVOICE NO.]] up to [DATE].

The last payment of Rs. [AMOUNT] was received on [DATE] by [NEFT / RTGS / cheque no. [CHEQUE NO.]], reference [UTR / REFERENCE NO.].

As on [DATE], no amount is due from [CUSTOMER NAME] to us in respect of the above.

This certificate does not cover: [ANY EXCLUSIONS, e.g. supplies made after [DATE] / warranty obligations / NONE].

For [YOUR COMPANY NAME]

[AUTHORISED SIGNATORY NAME]
[DESIGNATION]
Seal / stamp

Conditional no dues certificate (when the buyer wants it before paying)

Many buyers make the NDC a condition of releasing the last payment, the retention or the security deposit. If you sign an unconditional NDC and the money does not come, you have certified in writing that nothing is due. The safer route is a certificate that takes effect only on receipt.

NO DUES CERTIFICATE (CONDITIONAL ON PAYMENT)

Date: [DATE]

To,
[CUSTOMER NAME]
[CUSTOMER ADDRESS]

Ref: [PO / CONTRACT NO.] dated [DATE]

As per our books, the amount outstanding from you against the above [PO / contract] as on [DATE] is Rs. [AMOUNT IN FIGURES] (Rupees [AMOUNT IN WORDS] only), made up of:
1. Invoice balance: Rs. [AMOUNT] (Invoices [INVOICE NOS.])
2. Retention money: Rs. [AMOUNT]
3. Security deposit: Rs. [AMOUNT]

On receipt and realisation of the above amount of Rs. [AMOUNT] in our bank account [ACCOUNT NO. / IFSC], this letter shall operate as our no dues certificate, and we shall have no further claim against you in respect of the above [PO / contract], except [EXCLUSIONS, e.g. interest under the MSMED Act if paid late / NONE].

Until such realisation, this letter is not a confirmation that no dues are payable.

For [YOUR COMPANY NAME]
[AUTHORISED SIGNATORY NAME], [DESIGNATION]

How to fill it

1. Identify exactly what the certificate covers: one PO, one contract, an invoice range, or the whole account up to a date. Never write 'all dues of every nature' unless you mean it.
2. Check the bank statement, not the customer's remittance advice. Cheques must be cleared; TDS must appear in Form 26AS.
3. Record the last payment details (date, mode, UTR) so the certificate is tied to a real receipt.
4. Write exclusions explicitly: retention money, security deposit, interest, price-variation claims, supplies after the date.
5. Have it signed by the proprietor, a partner, a director or another authorised person, and keep a copy with proof of the payment it relies on.

Common mistakes

• Signing before the money arrives. The single most expensive mistake. Use the conditional format above.
• Signing the buyer's pre-printed form that says 'full and final settlement of all claims including interest'. That wording can waive your MSMED interest. Strike it out or issue your own certificate.
• No exclusions. If retention or a deposit is still pending, say so, or the NDC will be read as covering it.
• Wrong entity. Groups of companies often have several GSTINs; name the exact legal entity and GSTIN.

What happens next if you have already signed and are still unpaid

All is not necessarily lost. Courts look at the surrounding facts: whether the payment the NDC refers to was ever made, whether the certificate was a condition imposed for releasing admitted dues, and whether you protested promptly. Write to the buyer at once, stating that the NDC was issued in anticipation of payment that has not been received, and keep every email that shows the buyer demanded the NDC first. If you are negotiating a settlement instead, use a proper full and final settlement letter that ties the release to a specific payment.

For retention money recovery or security deposit recovery after an NDC dispute, an advocate's notice usually comes first. FundRaksha Legal sends it within 24 hours, on a 30% success fee. A free consultation will tell you how strong your position is.