Commercial contracts · Template
An MSA exists so that liability, intellectual property and payment are negotiated once, and every project after that starts with a one-page statement of work instead of another six-week contract cycle. Almost all of its value sits in how the two documents are wired together — which is the clause most MSAs get wrong.
Quick Statutory Answer
What is the difference between an MSA and an ordinary service agreement? A service agreement governs one engagement. An MSA governs the relationship and leaves the commercial specifics of each engagement to a statement of work, so the second and third projects need a page rather than a negotiation. The trade-off is that the MSA has to be drafted well enough to survive being applied to work nobody has described yet.
The full text of this document as VidhiSar drafts it, with every blank shown in square brackets. Copy it or download it as a Word file and fill it in yourself — or answer a few questions and VidhiSar fills it in and prints a formatted PDF. Clauses that apply only in some cases are left out here; the drafting flow adds them when your answers call for them.
PARTIES
This Master Services Agreement ("Agreement") is made on [Agreement Date] between:
[Client Legal Name], having its registered office at [Client Registered Address], bearing PAN / CIN [Client PAN / CIN] ("Client");
AND
[Service Provider Legal Name], having its registered office at [Service Provider Registered Address], bearing PAN / CIN [Service Provider PAN / CIN] ("Service Provider").
STRUCTURE OF THE AGREEMENT
This Agreement states the terms that govern every engagement between the parties. The particular services, deliverables, timelines and fees for each engagement shall be set out in a separate statement of work signed by both parties ("SOW"). Each SOW incorporates this Agreement by reference. In the event of conflict, this Agreement prevails, except where the SOW expressly records the clause of this Agreement it is varying.
TERMS AND CONDITIONS
1. Services. The Service Provider shall provide the services described in each SOW, broadly comprising [Scope of Services], with the skill and care reasonably expected of a competent provider of such services.
2. Term. This Agreement commences on the date first written above and continues for [Initial Term] year(s), and shall thereafter renew for successive periods of one year unless either party gives written notice of non-renewal at least thirty (30) days before the end of the then current term. Expiry of this Agreement does not terminate a SOW that is still running, and the terms of this Agreement continue to govern that SOW until it completes.
3. Fees and Invoicing. Fees shall be as stated in the relevant SOW. The Service Provider shall raise a tax invoice compliant with the Central Goods and Services Tax Act, 2017, and the Client shall pay each undisputed invoice within [Payment Terms] days of receipt. The Client shall deduct tax at source where required under the Income-tax Act, 2025 and shall furnish the corresponding certificate.
4. Late Payment. Any undisputed amount not paid when due shall carry interest at the rate stated in the SOW from the due date until payment. Where the Service Provider is a micro or small enterprise registered under the Micro, Small and Medium Enterprises Development Act, 2006, the payment period and the consequences of delay under Sections 15 and 16 of that Act shall apply and shall override any longer period stated in a SOW.
5. Client Obligations. The Client shall provide the access, information, approvals and personnel that the Service Provider reasonably requires. Where a delay is attributable to the Client, timelines shall be extended correspondingly and the Service Provider shall not be in breach on that account.
6. Intellectual Property. [IP Ownership Position]. The Service Provider retains ownership of its pre-existing materials, tools and generic know-how, and grants the Client a non-exclusive, perpetual, royalty-free licence to use those materials to the extent embedded in the deliverables. No licence is granted to either party save as expressly stated.
7. Confidentiality. Each party shall keep confidential the other's non-public information, shall use it only for the purposes of this Agreement, and shall return or destroy it on request. This obligation survives termination for three (3) years, and indefinitely for trade secrets.
8. Personal Data. Where the Service Provider processes personal data on the Client's behalf, it does so only on the Client's documented instructions, shall implement reasonable security safeguards, shall assist the Client in responding to a Data Principal's request, and shall notify the Client without undue delay on becoming aware of a personal data breach, so as to enable the Client to discharge its obligations as a Data Fiduciary under the Digital Personal Data Protection Act, 2023. The parties shall execute a separate data processing agreement where required.
9. Warranties. The Service Provider warrants that it has the right to enter into this Agreement, that the services shall be performed in a professional manner, and that the deliverables shall not knowingly infringe the intellectual property rights of any third party.
10. Limitation of Liability. Save in respect of a breach of confidentiality, infringement of intellectual property, personal data breach caused by the defaulting party, fraud, wilful misconduct, or any liability that cannot be limited under Indian law, the aggregate liability of either party under this Agreement shall not exceed [Liability Cap]. Neither party shall be liable for indirect or consequential loss. The parties record that under Section 74 of the Indian Contract Act, 1872 a stipulated sum operates as a cap on reasonable compensation actually proved, and not as an automatic entitlement.
11. Indemnity. Each party shall indemnify the other against third-party claims arising from its own breach of Clause 7, Clause 8 or Clause 9, subject to prompt written notice of the claim and reasonable cooperation in its defence.
12. Termination. Either party may terminate this Agreement or any SOW for material breach not remedied within thirty (30) days of written notice, or on the insolvency of the other party. Either party may terminate for convenience on [Termination for Convenience Notice] days' written notice. On termination, the Client shall pay for services performed and expenses committed up to the effective date, and the Service Provider shall deliver up work in progress.
13. Independent Contractor. The Service Provider is an independent contractor. Nothing in this Agreement creates a partnership, joint venture, agency or employment relationship, and the Service Provider's personnel remain its own for the purposes of all labour and social security legislation.
14. Force Majeure. Neither party shall be liable for failure to perform caused by an event beyond its reasonable control, provided it notifies the other promptly and resumes performance as soon as reasonably possible. If such an event continues for more than sixty (60) days, either party may terminate the affected SOW.
15. Dispute Resolution. The parties shall first attempt to resolve any dispute by discussion between senior representatives for thirty (30) days. Failing resolution, the dispute shall be referred to arbitration by a sole arbitrator under the Arbitration and Conciliation Act, 1996, seated at [Seat of Arbitration], conducted in English. The award shall be final and binding.
16. Governing Law. This Agreement is governed by the laws of India, and subject to Clause 15 the courts at [Courts Having Jurisdiction] shall have exclusive jurisdiction.
17. Entire Agreement and Amendment. This Agreement together with its SOWs constitutes the entire agreement between the parties on its subject matter and may be amended only in writing signed by both parties.
EXECUTION
The parties have executed this Master Services Agreement as of the date first written above.
What the law behind this document actually requires.
| Essential Clause | Legal Purpose & Protection | Governing Law / Benchmark |
|---|---|---|
| A precedence clause between the MSA and each statement of work | The MSA should govern unless a SOW expressly names the clause it is varying. Without that, a one-page SOW signed by a salesperson quietly overrides the liability cap you spent three weeks negotiating. | MSMED Act, 2006 — ss. 15 and 16 |
| A liability cap with real carve-outs | Confidentiality breach, IP infringement, data breach caused by the defaulting party and fraud sit outside the cap in almost every negotiated agreement. Note also that a stated sum operates as a ceiling on compensation actually proved, not as a guaranteed payout. | Indian Contract Act, 1872 — s. 74 |
| IP ownership stated at the deliverable level, with a licence back for pre-existing tools | A provider who assigns everything, including its own framework and internal tooling, is either misdescribing the deal or about to be unable to work for anyone else. Separate the deliverable from the toolkit that produced it. | Digital Personal Data Protection Act, 2023 — s. 8(5) |
| Payment terms, invoicing mechanics, and the statutory override | State the invoice requirements, the payment window and what happens on late payment — then recognise that where the supplier is a registered micro or small enterprise, the statutory maximum applies regardless of what the MSA says. | MSMED Act, 2006 — ss. 15 and 16 |
| A data processing clause tied to the DPDP Act | Processing on documented instructions, reasonable security safeguards, breach notification without undue delay, and assistance with a Data Principal’s request. The obligation to the individual stays with the fiduciary, so the contract is where the processor’s duties have to be written down. | Indian Contract Act, 1872 — s. 74 |
| Termination for breach and for convenience, and what happens to work in progress | Say who can end it, on what notice, what is payable up to that date, and that work in progress is delivered up. An MSA that can only end on a breach is an MSA nobody can exit cleanly. | Digital Personal Data Protection Act, 2023 — s. 8(5) |
| One dispute mechanism, with the seat named | Escalation, then arbitration, then a named seat and governing law — in one clause that does not contradict itself. Two clauses pointing at different forums produce a preliminary dispute about where the dispute happens. | MSMED Act, 2006 — ss. 15 and 16 |
A service agreement governs one engagement. An MSA governs the relationship and leaves the commercial specifics of each engagement to a statement of work, so the second and third projects need a page rather than a negotiation. The trade-off is that the MSA has to be drafted well enough to survive being applied to work nobody has described yet.
Whichever the precedence clause says wins. The usual and safer position is that the MSA prevails except where a SOW expressly identifies the clause it is varying — that way a variation has to be deliberate rather than accidental.
You can write it, but where the supplier is a registered micro or small enterprise the statutory maximum applies over your term, and delayed payment carries compound interest that cannot be negotiated away. The clause does not make the exposure disappear; it just hides it until the supplier decides to raise it.
If personal data is processed on your behalf, you need the processing terms in a valid contract — either inside the MSA or in an addendum. A separate addendum is usually cleaner, because it can be updated as the processing changes without reopening the whole commercial agreement.
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