10 Questions You Must Ask Before Signing a Construction Agreement in Indore

Most homeowners in Indore spend months deciding on a plot, weeks choosing a contractor, and then sign the construction agreement in about twenty minutes without reading it properly.

That agreement is the only legal protection you have for what is likely the biggest financial decision of your life. Everything — the quality of materials, the construction timeline, who pays for delays, what happens if something cracks two years later — is determined by what's written in that document. Or not written, which is where most problems start.

Here are the ten questions every homeowner in Indore must ask and get answered in writing before signing any construction agreement. These apply whether you're building a duplex, a G+2 family home, or a small commercial structure.

1. Is the Scope of Work Written Out Line by Line — or Just Described in General Terms?

This is the question most people don't ask, and it's the one that causes the most disputes.

A vague scope of work like "construction of G+1 house as per drawing" is not a scope of work. It's an invitation for a dispute. When the agreement doesn't clearly spell out what's included, the contractor can claim that almost anything beyond the most basic work is an "extra" — and charge you accordingly.

A proper construction agreement scope for an Indore home should itemise:

• Foundation type and depth

• RCC work — columns, beams, slabs (with concrete grade specified)

• Brickwork (which type — fly ash, clay, AAC blocks)

• Plastering — internal and external, with number of coats

• Electrical — number of points, wiring type, DB box brand

• Plumbing — pipe material, number of outlets, sanitary fittings

• Flooring — tile or marble, grade, brand if agreed

• Painting — number of coats, brand, primer included or not

• Waterproofing — which areas, which system

• What is explicitly excluded

If the contractor resists this level of detail, that itself tells you something. A contractor who is confident in their work and pricing has no reason to keep the scope vague.

2. What Is the Payment Schedule — and Is It Tied to Work Milestones?

The payment structure in a construction agreement is one of the most important clauses for the homeowner, and one of the most abused in practice.

Never agree to a time-based payment schedule — where you pay every month regardless of progress. Always insist on a milestone-based structure tied to physical completion stages. A standard milestone payment structure for an Indore residential project looks like this:

• Mobilisation advance: 10–15% (paid at signing, after IMC Commencement Certificate is in hand)

• Foundation and plinth completion: 15–20%

• Ground floor slab casting: 15–20%

• First floor slab casting (if applicable): 15%

• Brickwork, plastering, and MEP rough-in complete: 15%

• Flooring, painting, and finishing: 10%

• Final retention: 5–10% (held back for 6–12 months as defect liability)

  
  

The retention amount is critical. This is the money held back after handover to ensure the contractor returns and fixes any defects that show up in the first year. Most contractors in Indore will push back on this — but it is a standard, legitimate practice and you should insist on it.

Never pay more than 20–25% as an advance upfront. A contractor who demands 40–50% before breaking ground is either cash-strapped or planning to use your money to fund someone else's project.

3. What Grades and Brands of Materials Will Be Used — and Is It Written in the Agreement?

"Good quality cement and steel" written in a contract is meaningless. On the day of procurement, the contractor will use whatever is cheapest and available — and your agreement gives you no recourse.

The construction agreement must specify materials by grade and brand. At a minimum, insist on:

• Cement: Brand (UltraTech, ACC, Ambuja, Shree, or Dalmia) and type (PPC for masonry, OPC 53 for structural)

• Steel/TMT bars: Grade (Fe500D minimum), and brand (Tata Tiscon, JSW Neosteel, SAIL, Kamdhenu)

• Bricks: Type (fly ash bricks preferred in Indore — IMC-compliant and lower cost post the current 5% GST rate)

• Tiles: Brand, size, and grade if agreed upon

• Pipes: Brand and material (CPVC for hot water, UPVC for drainage)

• Paint: Brand and number of coats on each surface

  
  

Getting this in writing also protects you in a practical sense — you can spot-check deliveries against the agreement without needing technical knowledge. If the agreement says Tata Tiscon Fe500D and the truck delivers something else, you have grounds to stop that procurement immediately.

4. What Is the Exact Timeline — With a Penalty Clause for Delays?

Every construction agreement in Indore should have a clearly written project timeline with start date, stage-wise milestones, and a final handover date. It should also have a penalty clause for contractor-caused delays.

Without a penalty clause, the contractor has no financial incentive to complete your project on time. Delays in Indore construction projects are extremely common — not always because of bad intent, but because a contractor running multiple projects will naturally prioritise whichever one has financial pressure. If you are paying on time and not applying contractual pressure, your project tends to get deprioritised.

A standard liquidated damages (LD) clause in Indian residential construction specifies a daily or weekly penalty as a percentage of the total contract value for each day of delay beyond the agreed completion date. A typical range is 0.5–1% of contract value per week of delay, capped at 5–10% of the total contract value.

Also ask: what counts as an "acceptable delay"? Heavy rain during Indore's monsoon (June–September) is an acceptable force majeure reason. Material price fluctuations are not. Define this clearly in the agreement, otherwise every delay will be blamed on weather.

5. Who Is Responsible for Getting IMC Permissions and Approvals — and Who Pays for Them?

This is a point that creates genuine confusion and disputes in Indore because different contractors handle it differently.

Some contractors include IMC building plan approval, Commencement Certificate, and Completion Certificate facilitation in their scope. Others treat it as the homeowner's responsibility entirely. Some include the work but expect the homeowner to pay approval fees separately.

The agreement must clearly state:

• Who coordinates and submits building plan drawings to the IMC

• Who pays for the architect and structural engineer fees for approval drawings

• Who pays government approval charges and fees

• Who is responsible for getting the Completion Certificate after construction

• What happens if there are plan deviations during construction that require resubmission

  
  

In Indore, IMC building plan approval typically costs ₹50,000–₹1,50,000 in government fees depending on the project size and zone, plus architect and structural engineer fees on top of that. If this is not clearly assigned in the agreement, it becomes a grey zone that generates arguments mid-project.

6. How Will Variations and Extra Work Be Priced?

No construction project of any significant size is completed exactly as originally designed. Mid-project changes happen — sometimes because the homeowner changes their mind, sometimes because site conditions require design adjustments, sometimes because something was missed in the original scope.

The agreement must specify how variations are priced. Options include:

• A pre-agreed rate schedule for common additions (extra electrical points at ₹X per point, extra flooring at ₹Y per sq ft, etc.)

• A clause that variations are priced at BOQ rates (the same rates used in the original agreement)

• A requirement that any variation above a certain value gets a written quote approved by the homeowner before work begins

  
  

Without this clause, extra work gets priced whatever the contractor thinks you'll agree to pay in the moment — usually significantly higher than BOQ rates. Many Indore homeowners who set a budget of ₹40 lakh end up spending ₹50+ lakh because variations were never properly contracted.

The simplest rule: no variation to be executed without a written change order signed by both parties. Make this explicit in the agreement.

7. What Is the Defect Liability Period — and What Does It Cover?

Once the contractor hands over the keys, most homeowners assume the relationship is over. It isn't — and shouldn't be.

Hairline cracks, seepage from the terrace after the first monsoon, grout failure in tiles, plumbing leaks, and door frame warping are all common issues that show up in the first year of a new building. In India, residential construction contracts typically include a Defect Liability Period (DLP) of 12–24 months after handover, during which the contractor is obligated to fix these defects at no additional cost.

Under the Indian Contract Act 1872 and relevant consumer protection provisions, a contractor who fails to rectify defects notified during the DLP is in breach of contract. The homeowner has the right to get repairs done and recover costs from the contractor.

But this only works if it's in the agreement. Ask specifically:

• What is the DLP duration? (Push for 12–18 months minimum)

• What defects does it cover? (It should cover structural, plumbing, electrical, and waterproofing issues)

• What is the process for raising a defect? (Written notification, agreed response time)

• Is the retention amount tied to the DLP end date? (It should be)

  
  

A contractor who refuses to include a DLP clause or insists on an unusually short one (less than 6 months) is signalling low confidence in their own workmanship.

8. Is the Contractor GST-Registered — and Will You Get Proper Invoices?

This is a practical question that Indore homeowners frequently skip because it feels bureaucratic. It isn't — it has direct financial and legal implications.

A GST-registered contractor working on a Works Contract for a residential homeowner charges 18% GST on their services. This is a real cost you need to factor into your budget. A contractor who is not GST-registered and doesn't charge GST may seem cheaper upfront — but this creates problems:

• You cannot get a proper tax invoice, which is required for home loan disbursements from banks

• If you later sell the property or use it as collateral, the absence of proper invoices creates documentation gaps

• It exposes the contractor to legal non-compliance, which can become your problem indirectly

  
  

Ask the contractor for their GST registration number before signing. Verify it on the GST portal. And confirm that all invoices will be GST-compliant, stage-wise, and linked to the milestones in your payment schedule.

9. Who Supervises the Day-to-Day Work on Site — and What Are Their Qualifications?

The contractor you meet during negotiation and the person who actually manages your site every day are often two different people. In Indore, it's common for a senior contractor to sign the agreement and then hand the project off to a junior supervisor or foreman who may have varying levels of competence and authority.

The agreement should specify:

• Who is the designated site supervisor or project engineer

• Their qualifications or experience (at minimum, a diploma or degree in civil engineering for a project above a certain size)

• How often the contractor themselves will visit the site

• What the escalation path is if you have quality concerns — who do you call, and what is the expected response time

  
  

For larger residential projects (duplex, G+2, or commercial), having a third-party quality inspector do periodic checks at key stages — foundation, column casting, slab casting — is worth the cost. This is separate from the contractor and provides an independent verification that work is happening as specified.

10. What Happens If Either Party Wants to Exit the Agreement?

Nobody wants to think about this at the time of signing — but it is the question that matters most if the relationship goes wrong.

Construction contracts sometimes break down. The contractor may stop showing up because they're financially stretched. You may find persistent quality issues that aren't being resolved. There can be genuine disagreements about scope or payment.

The agreement must have a clear termination clause that addresses:

• What constitutes a breach by the contractor (defined delays, material substitutions, abandonment of site)

• What constitutes a breach by the homeowner (non-payment per schedule without valid reason)

• How much notice each party must give before terminating

• How the final settlement is calculated if the contract is terminated mid-project — what work done is valued at, how materials on site are handled

• Which forum is used to resolve disputes — arbitration (faster and private) or civil court (slower but sometimes necessary)

In Indore, most residential construction disputes end up being settled through negotiation or, when serious, through consumer courts or civil courts in Madhya Pradesh. Having an arbitration clause with a mutually agreed arbitrator can resolve disputes faster and at lower cost than court proceedings.

One Final Point Before You Sign

Reading these ten questions, you might be wondering whether any contractor in Indore will actually agree to all of this. The answer is: a good one will.

A contractor with a solid track record, proper business registration, and confidence in their work quality will not be threatened by a detailed, fair agreement. In fact, a detailed agreement protects them too — it prevents misunderstandings about scope, limits their liability for things outside their control, and gives them a clear payment structure.

The contractors who resist detailed agreements are typically those who have something to hide — either in their pricing, their material sourcing, or their past project performance.

This is why who you build with matters as much as the contract you sign. Shriketu Construction Pvt. Ltd. operates on written agreements with clearly defined scopes, stage-wise payment structures, material specifications, and a post-handover defect liability commitment. For homeowners in Indore who want the protection of a properly structured agreement alongside experienced construction execution, a consultation with their team before you start negotiating with any contractor is a practical first step.

Quick Checklist — Before You Sign Any Construction Agreement in Indore

1. Scope of work is detailed line by line — nothing left to interpretation

2. Payment schedule is milestone-based, not time-based, with 5–10% retention held till DLP end

3. Materials are specified by brand and grade — not vague descriptions

4. Timeline is written with specific dates and a penalty clause for contractor delays

5. Permissions and approvals responsibility is clearly assigned with cost allocation

6. Variation pricing has a defined process — no verbal approvals, written change orders only

7. Defect Liability Period is 12–18 months minimum, with a defined defect reporting process

8. Contractor is GST-registered — GST number verified, compliant invoices for every payment

9. Site supervisor is named with qualifications — escalation process is defined

10. Termination and dispute resolution clauses are fair to both parties and clearly written

A construction agreement that covers all ten of these points takes maybe an extra hour to finalise before signing. That hour has a very good chance of saving you lakhs of rupees — and months of stress — over the course of your project.