Agreement between Contractor and Owner for Construction of a Building by Shiva.

No. 8

Agreement between Contractor and Owner for
Construction of a Building

THIS AGREEMENT is made the . . . . . day of . . . . . , 20 . . . . . . . BETWEEN A. B., a firm of building contractors, duly registered under the Indian Partnership Act, 1932 having its registered office at . . . . . . . . . . . . . . . acting through its managing partner Shri . . . . . . . . . . . . . . . . . . . ., (hereinafter called the ‘‘Contractor’’) of the one part, AND C.D., aged about . . . . . . . years, son of . . . . . . . . . ., resident of . . . . . . . . . ., (hereinafter called the ‘‘Owner’’) of the other part.

WHEREAS the owner is desirous of getting built a two-storeyed pucca building facing the . . . . . . . . . . Road in the city of . . . . . . . . . . according to plans already made and the specifications provided therein, and has for the said purpose invited tenders for the same;

AND WHEREAS the Contractor has offered to build the said building according to the plan and specification given, for a sum of Rs one lakh on the conditions hereinafter mentioned.


1. That in pursuance of this agreement and in consideration of the payment of Rs one lakh by the Owner to the Contractor in the manner hereinafter provided the Contractor shall build a two-storeyed pucca house facing the . . . . .  Road in the city of . . . . . . . . . . . . . . according to plans and specifications attached and made part of this agreement within a period of . . . . . . . . . . months from the date hereof.

2. That the Contractor shall provide all the labour and material and perform all the work shown in the drawing as per specifications given and prepared by Shri . . . . . . . . . . . . . hereinafter referred to as the Engineer.

3. That the Owner shall make payments on account of this agreement of the total sum of Rs one lakh as follows—Rs 10,000 on the signing of this agreement and the balance of Rs 90,000 in nine instalments, the first instalment on the completion of the ground and the trenches but before any foundation is laid, the second instalment on the completion of the building up to ground level, the third instalment on the completion of all the supporting walls, the fourth instalment on the completion of the roofs, the fifth instalment on the completion of the plastering, the sixth instalment on the completion of the floors, the seventh instalment to be paid on the completion of the entire building complete with doors, windows with white or colour wash as may be specified and the eighth instalment on and after fixation of all water, sanitary and electrical fittings as provided in the specifications hereto. The final instalment of the balance of Rs 10,000 to be paid after the first rains and on a final certification of fitness and such necessary repairs as may be advised by the Engineer. The payment of each instalment shall be subject to the recommendation of the Engineer as to the completion of work up to the stage required for the payment of such instalment.

4. The Contractor shall build and carry out the work in all respects according to the plans and specifications given in the Schedules hereto. In case the Schedule of specification is silent on any point, the standard specification for such work as prescribed by the P. W. D. shall be followed. In the event of the Contractor failing to complete the work by the date or the period hereinbefore specified the Contractor shall be liable to pay by way of liquidated damages a sum of Rs . . . . . . . . . . per day deductible from the final payment of Rs . . . . . . .  payable after the first rains. If the work is delayed by force majeure or by reason of any exceptionally inclement weather or by reason of authorised extras or additions or variations in the contract, by reason of any civil commotion, riot, local combination of workmen, or strikes or lockout or by any reason of any materials being inprocurable a fair and reasonable extension of time for completion shall be made in respect thereof as may be agreed upon in writing by the Contractor and the Owner.

5. Time shall be construed as the essence of the contract and it is therefore hereby expressly provided and declared that—

(a)   if the Contractor shall make default in commencing the work within a reasonable time from the date hereof; or

(b)   if the Contractor shall at any time, whether before or after the date or extended date for completion, make default in proceeding with the work with due diligence; or

(c)   if the Contractor shall make default in the due performance of all or any of the conditions the Owner shall be at liberty on the written advice of the Engineer to give notice in writing of such default to the Contractor, specifying the same, and if the Contractor shall continue with such default for a period of seven days after such notice, then the Owner shall have power to determine the contract by notice in writing (but without prejudice to any right which may have already accrued to the Owner under this agreement).

In any case under this paragraph if the Owner has to complete or get completed the work through another contractor, all losses or damages arising therefrom shall have to be borne by the Contractor and if the completion of the work entails a lesser expense the balance shall be payable to the Contractor on the completion of the work and after the first rains are over.

6. All authorised extras or additions or variations will be undertaken by the Contractor and work begun thereon after estimate for such extras, additions or variations have been settled in writing between the Contractor and the Owner.

7. That if the Contractor becomes insolvent, or makes any arrangement with creditors or assigns or sublets this contract without the written approval of the Owner or attempts to do so or is wound up or dissolved except for the purpose of reconstitution, the Owner shall have the option of terminating the contract without any compensation to the Contractor.

8. That all questions relating to the making of specifications, drawings and instructions hereinbefore mentioned, provided or attached and as to the quality of workmanship or material used in the work AND all the disputes and differences which shall arise either during the progress of the work or after completion thereof concerning the work or the execution or maintenance thereof or the construction or meaning of these conditions or as to any other matter arising out of or relating to this agreement or the work to be executed or payments or refunds to be made in pursuance thereof shall be referred to the sole arbitration of the Engineer, whose decision shall be final, conclusive and binding on the parties to this agreement.

IN WITNESS whereof (as in Precedent No. 4)

For A. B.

Witnesses:                                                                    Partner.

1.                                                                                 Contractor.

2.                                                                                 Sd. C. D.