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IT is understood that this letter is only a required letter and doesn't constitute a charter agreement and the contract between the parties shall come into effect only on the execution of the said Charter Agreement. Further, this letter is subject to the following:-

1)All the aircraft offered and the maintenance facilities being found satisfactory on physical inspection. Aircrafts will be made available by you for inspection within 72 hours of the receipt of this letter.

2)Verification of authority from the operator(s)/owner(s) to M/s. Baron International Airways to offer the aircraft on lease to Charterer. The Baron International Airways shall furnish the necessary documentary evidence to this effect.

3)M/s. Baron International Airways acceptance to include the Lease Agreement the clauses contained in "Commitments to be obtained from the Lessor" a copy of which was provided to M/s. Baron International Airways.

4)M/s. Baron International Airways providing to the Charterer a Performance Guarantee as mentioned at Para 4 above.

5)As aircrafts have to be positioned in India by M/s. Baron International Airways we would request in our mutual interest and to ensure the smooth operation that M/s. Baron International Airways signs the duplicate copy of this letter as a token of acceptance of the above terms and conditions."

(11) The conditions that were set out in the Letter of Intent issued in favour of the appellant by respondent No. I were as follows:

I)Aircraft should be positioned/ mobilizing by March 14, 1996;

II)Aircraft should have airworthiness clearance from D.G.C.A./Air India;

III)Baron Airways should have clear authority to wet-lease the air- craft for charter operations;

IV)performance guarantee of 15% must be produced;

V)No mobilization advance will be payable since Chc has never paid this in the past."