Part XII - Finance & Property • Article

Article 299 Simplified: Contracts

Article 299 sets strict rules for how government contracts must be signed. To prevent fraud and protect public funds, any contract signed by the Government (Union or State) must: 1) Be expressed to be in the name of the President of India (for the Union) or the Governor (for States). 2) Be signed in writing by an authorized officer. Importantly, the President or Governor cannot be held personally liable for these contracts.

Official Text

(1) All contracts made in the exercise of the executive power of the Union or of a State shall be expressed to be made by the President, or by the Governor of the State, as the case may be, and all such contracts and all assurances of property made in the exercise of that power shall be executed on behalf of the President or the Governor by such persons and in such manner as he may direct or authorise. (2) Neither the President nor the Governor shall be personally liable in respect of any contract or assurance made or executed for the purposes of this Constitution, or for the purposes of any enactment relating to the Government of India heretofore in force, nor shall any person making or executing any such contract or assurance on behalf of any of them be personally liable in respect thereof.

Simple Meaning

Explain Like Ten

When the government buys computers or hires builders, the contracts must say they are made in the name of the President of India (for the country) or the Governor (for the state). Also, the President or Governor can't be personally sued if the government breaks the contract.

Student Mode

Article 299 prescribes the formal requirements for government contracts. To be legally binding, a contract must be: (1) expressed to be made by the President or Governor, (2) in writing, and (3) executed by authorized officers. Oral or informal agreements do not bind the government. Clause (2) grants personal immunity to the President, Governor, and executing officers.

Example

When the government hires a contractor to build a highway, the contract document will state it is between 'The President of India, acting through the Ministry of Road Transport' and the construction company. If a dispute occurs, the contractor cannot sue the President personally; they must sue the government entity.

Key Takeaway

Government contracts must be formally written and executed in the name of the President or Governor, protecting them from personal liability.

FAQs

Can an oral agreement with a government officer bind the government?

No. Under Article 299, informal or oral contracts are void against the government. All contracts must be in writing and signed by an authorized representative.

Are government officers personally liable for contracts they sign on behalf of the President?

No, as long as they act within their authority, they have personal immunity under Article 299(2).

Quiz

In whose name must all contracts made in the exercise of the Union's executive power be expressed?

Answer: The President

What is the legal effect of an oral contract made by a State government officer?

Answer: It is void and unenforceable