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Service Engagement Letter Template for India

A Service Engagement Letter is a formal document used in the Indian business context to establish and define a professional services relationship between a service provider and a client. This document, governed by Indian contract law and relevant service sector regulations, outlines the scope of services, terms of engagement, fees, responsibilities, and key deliverables. It serves as a legally binding agreement while maintaining a more personal and professional tone compared to traditional contracts, making it particularly suitable for professional services engagements in the Indian market.

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What is a Service Engagement Letter?

The Service Engagement Letter is a crucial document in the Indian professional services landscape, used to formalize business relationships while maintaining a more approachable format than traditional contracts. It is particularly relevant when professional services firms, consultants, or independent contractors engage with clients for specific projects or ongoing services. The document combines elements of professional correspondence with legal requirements under Indian law, including essential components such as scope of work, fee structures, and terms of engagement. This format is preferred in India for professional services as it strikes a balance between formal legal protection and business relationship management, while ensuring compliance with Indian contract law and sector-specific regulations.

What sections should be included in a Service Engagement Letter?

1. Letter Date and Address Block: Date of the letter and full contact details of both parties

2. Salutation: Professional greeting to the client

3. Introduction: Opening paragraph establishing the context and purpose of the engagement

4. Scope of Services: Clear description of services to be provided, including any limitations

5. Team and Resources: Key personnel assigned to provide the services

6. Fees and Payment Terms: Detailed fee structure, payment schedule, and billing arrangements

7. Timeline and Deliverables: Expected duration, key milestones, and deliverables

8. Confidentiality: Obligations regarding confidential information

9. Standard Terms: Reference to standard terms and conditions

10. Acceptance: Signature blocks and acceptance mechanism

What sections are optional to include in a Service Engagement Letter?

1. Regulatory Compliance: Include when services involve regulated activities or specific compliance requirements

2. IP Rights: Add when intellectual property will be created or used during service delivery

3. Force Majeure: Include during uncertain times or for long-term engagements

4. Non-Solicitation: Add when protecting against poaching of staff is important

5. Insurance: Include for high-risk services or when required by industry standards

6. Data Protection: Add when personal data processing is involved

7. Conflict of Interest: Include when working in sensitive industries or with competing clients

What schedules should be included in a Service Engagement Letter?

1. Schedule A - Detailed Scope of Services: Comprehensive breakdown of services, methodologies, and expectations

2. Schedule B - Fee Schedule: Detailed fee structure, rates, and payment terms

3. Schedule C - Standard Terms and Conditions: Detailed legal terms governing the engagement

4. Schedule D - Team Structure: Detailed team composition, roles, and responsibilities

5. Appendix 1 - Required Documents: List of documents required from client

6. Appendix 2 - Service Levels: Performance standards and service level commitments if applicable

Authors

Alex Denne

Head of Growth (Open Source Law) @ Ƶ | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents

Jurisdiction

India

Publisher

Ƶ

Cost

Free to use

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