The Subcontractor Demand For Payment Letter is a critical document in the Indian construction and service industries, used when a subcontractor has completed agreed-upon work but has not received payment from the main contractor within the stipulated timeframe. This document serves as a formal demand and can be an important piece of evidence in potential legal proceedings. It must comply with Indian contract law and incorporate specific provisions from the MSME Development Act 2006 when applicable. The letter typically follows unsuccessful informal payment requests and precedes more serious legal actions. It should detail the work completed, payment terms from the original contract, and provide clear payment instructions while maintaining a professional yet firm tone.
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1. Letterhead and Date: Company letterhead with full contact details and date of the letter
2. Recipient Details: Full name, designation, and address of the recipient (main contractor)
3. Subject Line: Clear reference to 'Demand for Payment' and the project/contract reference number
4. Contract Reference: Details of the subcontract agreement including date and project name
5. Work Completion Statement: Brief description of completed work and confirmation of delivery as per contract terms
6. Payment Details: Specific amount owed, invoice references, and due dates
7. Demand Statement: Clear and formal demand for payment with specific deadline
8. Legal Basis: Reference to relevant contractual clauses and legal rights supporting the demand
9. Contact Information: Details for making the payment and contact person for any queries
10. Closing and Signature: Professional closing, name and signature of authorized person
1. Previous Communication Reference: Include when there have been prior payment requests or relevant communications
2. Interest Calculation: Add when claiming interest on delayed payments as per contract or law
3. Dispute History: Include if there are relevant disputed items that need addressing
4. Legal Consequences: Add when intending to highlight potential legal actions in case of non-payment
5. Payment History: Include when there's a pattern of late payments or partial payments to be addressed
6. Mediation Proposal: Add when offering dispute resolution options before legal action
1. Schedule A - Invoice Copies: Copies of all relevant unpaid invoices
2. Schedule B - Work Completion Certificates: Documentation proving completion of claimed work
3. Schedule C - Contract Excerpts: Relevant sections of the subcontract agreement regarding payment terms
4. Schedule D - Communication Log: Records of previous payment requests and related communications
5. Schedule E - Interest Calculations: Detailed breakdown of interest calculations if applicable
6. Schedule F - Project Documentation: Relevant project documents supporting the payment claim
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