Taking the data of Example 1, apportion the total lease payments between finance charge and outstanding liability.

Data from Example 1

Jindal Aluminum Limited (JAL) acquired a machinery from Jagson Enterprises (JE) for a lease term of four years, which covers almost complete economic life of the asset. The lease commences on April 1, 2009 and will expire on March 31, 2013. The fair value of the machine at the commencement of the lease term is ₹4,00,890 and JAL is required to pay to JE an annual lease rent of ₹1,20,000 per annum and a guaranteed residual value of ₹30,000 at the end of the lease term. Calculate implicit interest rate.