SVKM’s Narsee Monjee Institute of Management

Studies Bangalore

Legal Aspect of Business Assignment

Topic: Contract between a banking company and provider of IT maintenance services for
maintenance of bank’s IT hardware and software assets.

Submitted To: Professor Srinivas Mantripragada

Submitted By: Group 4 (Division C)

Avni Maheshwari C010 80203190102

Hershita Rai C017 80203190132
Kriti Daga C021 80203190047
Lakshay Gupta C022 80203190187
Rohan Vora C038 80203190182
Shivangi Bhardwaj C042 80203190030
Sneha Sharan C047 80203190159
Vinayak Dhingra C053 80203190058

Contract between a Banking company and provider of IT maintenance services for

maintenance of bank’s IT hardware and software assets
 This Service Agreement made and entered on this Thursday of 25 February, 2020 between
IDBI Bank Limited, a company incorporated under the Banking Regulation Act 1949, and
having its Registered Office at IDBI Tower, World Trade Center Complex, Cuffe Parade,
Colaba, Mumbai - 400005 and a Branch Offices amongst other places .

AND

M/s ABC limited, IT Company which provides IT maintenance services for maintenance of
bank’s IT hardware and software assets .

Each of the parties mentioned above are hereinafter collectively referred to as “Parties” and
individually as a “Party”.
Now therefore, in consideration of the mutual covenants, undertakings and conditions set
forth below, and for other valid consideration the acceptability and sufficiency of which are
hereby acknowledged, the Parties hereby agree to the following terms and conditions
hereinafter contained:-

Section A
Structure of the agreement
 1. Scope of the agreement: This clause would entail and enlist exhaustively, details of
the type of service to be provided by the IT company to the banking company, much
like an Articles of Association.

2. Period of the contract: Normally, a contract of such type would be an Annual

Maintenance Contract, and would be effective for a period of 12 months, after which
it may or may not be renewed.

3. Additional conditions of contract:

4. Requirement (Specific): This clause would state the number of engineers required to
tend to any software or hardware issue that may arise during all banking hours on all
working days of the bank.

5. Qualifications (Specific): This clause would state the basic qualification required for
any professional who would be working as an engineer on the project.

6. Review (Specific): This clause would require the vendor to carry out a periodic
review on all hardware and software assets (minimum once in every quarter) and
replace any hardware parts in case they are non-functional.

7. Terms of Payment: This clause would define how the firm would accept payment,
which may be monthly or a fixed charge up front, which is generally the case in the
case of an AMC.

8. Replacement cost: This clause would which party the cost of replacement of any
hardware assets would fall on.

9. Penalty for lack of service support : Company expects proper service support
during contract period. The hardware should be set right within 48 hours of reporting
the complaint. In case the machine is down for more than 3 working days and no
substitute/standby system of similar or higher capacity in good working condition is
provided by the vendor. Penalty shall not exceed 25% of the AMC cost per year for
the affected hardware unit. the penalty may be recovered from the amount payable to
the vendor by the company. the vendor can provide substitute/standby equipment for
a maximum of 15 days. in case vendor could not repair/replace the hardware items
within 15 days, the company can get it repair from outside agency and cost of repair
will be recovered from AMC payment.

Section B
Importance of Specific Clauses
 1. Requirement: Being a contract for maintenance of IT hardware and software assets,
it would require a certain level of expertise to be able to effectively satisfy the scope
of work of the contract.

2. Qualifications: Since this clause succeeds the Requirement clause, it qualifies as a

specific clause as well since any engineer tasked with maintenance of IT hardware
and software assets should possess the required skill set to satisfy the scope of work
of the contract.

3. Review: Maintenance of IT hardware and software assets would include the timely
repairing of any or all parts of hardware and re-writing of software codes, if required.
A periodic review would help ascertain the necessity to carry out these functions.

Draft of Clauses

Specific Clauses
1. Requirements: The firm shall provide a minimum of 6 (Six) professionals over 12
hours spanning two shifts of six hours each with at least two persons being available
for a minimum of eight hours every day.

2. Qualifications: The professionals deployed by the firm must have obtained at the
least, a Bachelors degree in Computer Science or Computer engineering and must
also have a minimum experience of 3 years in the same area of work.

Standard Clauses
1. Scope of work:
(a) The contract would be including repairs or replacement of parts of thirty-six pre-
installed personal computers and four printers, all present within the premises of
the branch of the bank.
(b) Upkeep and maintenance of the hardware installed.
(c) Security of the bank’s software as they exist, and protection of the bank’s servers
from unauthorized entry or access.
(d) Support for bank staff and troubleshooting of software packages and removal of
virus and re-installation of software, if corrupted.

2. Additional conditions of the contract:

(a) The firm will maintain a log book for any and all maintenance and repair work
done. After each maintenance/repair, the details shall be entered in the log book
register which shall be signed by the firm representative and branch manager.
(b) No repairs or replacement shall be done without obtaining prior consent of branch
manager
(c) Any parts used for repairs or replacement shall be ISI certified to ensure future
quality.