New Delhi: In a big relief to contractors and suppliers executing contracts with government entities in the ongoing West Asia situation, the Centre on Friday said that they won’t face any penalties if their work has been disrupted due to the crisis, according to the finance ministry.
Issuing an office memorandum issued, the department of expenditure clarified that delays caused due to such disruptions will be treated under the “force majeure” clause, which allows relief in extraordinary circumstances beyond human control”. “A force majeure (FM) means extraordinary events or circumstances beyond human control, such as a war…,” the ministry said, adding that such a clause “frees both parties from contractual liability” when obligations cannot be fulfilled due to such events.
The relief, however, applies to contracts with government agencies across goods, services and works, covering suppliers, consultants and contractors engaged in public procurement. “The contractors will not face penalties for such delays. The supplier would not be liable for imposition of any such sanction so long as the delay is the result of an event covered in the FM clause,” the memorandum said.
The ministry further stated that in cases where contracts have been impacted due to the prevailing West Asia situation, the procuring entities may invoke force majeure. “The deadlines for completion of contracts due on or after February 28, 2026, may be extended for a period of not less than two months and not more than four months without imposition of any cost or penalty,” the ministry said.
Disclaimer : This story is auto aggregated by a computer programme and has not been created or edited by DOWNTHENEWS. Publisher: deccanchronicle.com
