Specimen Contract Form for Sale and Purchase Transactions :
The above specimen contract form, drawn up in brief essentials, is meant for simple small scale transactions and is intended to draw the attention of the parties to important aspects of the trade deal in drafting the contract.
1. Name and address of the parties. . . . . . ... (state registered and complete address of the parties)
2. We, the above named parties have entered into this contract for the Sale / purchase, etc. (state brietly the purpose of the contract) on this (date) at (Place) subject to the following terms and conditions.
Quantity............. . ..
(Describe the quantity, quality and other specifications of the
goods precisely as per agreement. An agency for inspection/
certification of quality and/or quantity may also be stipulated).
Price..................... .. . .
Mode of payment. . . . . . . . . . . . . .. . .
(Quote the price, terms, i.e. ex-works/FOB (free on board) CIF (cost, insurance & freight) etc. in the currency agreed upon and describe the mode or payment i.e. payment against LlC (letter of credit/DA (document against acceptance)/D/P (document
against payment) etc. It is also desirable to mention the exchange rate.)
Shipment.................. . .
(Specify date of delivery and the maximum period upto which delivery could be delayed and for which reasons including penalty clarifications, Port of Shipment and of delivery should be mentioned).
Packing and marking. . . . . . . . . .. . .
(Requirements to be specified precisely).
(State the type of insurance cover required, i.e. FPA (free from particular average), WA (with average)/ All Risks, etc. State also the party responsible for the insurance).
Brokerage / Commission .
(If any payable may be mentioned)
Passing of the property and of risk….
The property or ownership or the goods and the risk shall finally pass on to the buyer at such stage as the parties may agree, i.e. when the goods are delivered at the seller's place of work / pass the ship's rails / are covered by insurance etc. as per agreed terms).
Arbitration clause recommended by the Council of Arbitration :
All disputes or differences whatsoever arising between the parties out off relating to the construction, meaning and operation or effect of this contract or the breach there of shall be settled by arbitration in accordance with the rules of Arbitration of the Council of Arbitration and the award made in pursuance there of shall be binding on the parties.
(Any other arbitration clause that may be agreed upon between the parties)
Any other special condition, prevalent in or relevant to the particular line of trade or transaction may also be specified.
The above specimen contract form, drawn up in brief essentials, is meant for simple small scale transactions and is intended to draw the attention of the parties to important aspects of the trade deal in drafting the contract. The parties are free to add to or modify the terms as per the peculiar nature of their trade transaction. They may also consult with advantage, experienced commercial or arbitration bodies for the purpose or study published literature on the subject. The use of arbitration clauses in commercial contracts is becoming increasingly common, particularly in export-import transactions, with a view to promoting smooth and swift flow of business.
The Council of Arbitration which is partly founded by the Government provides comprehesive institutional arbitration service to all government departments and public undertakings as well as privte traders, exporters and importers in India for amicable and quick settlement of all types of commercial disputes. It has been suggested by the Ministry of Commerce that all commercial organisations should make use of the arbitration clause of the Council in their commercial contracts with foreign parties.
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