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For & On Behalf of the President of India

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"For & On Behalf of the President of India"

What is its significance?

By Girish Bhatnagar

Retired General Manager, East Central railway, Hajipur

1. When we sign contracts in Govt. Departments, we sign above the words - "For & on Behalf of the President of India". Some people who sign contracts day in and day out, do not notice these words and most do not realize its significance. But these words are a major legal safeguard for the person who signs contracts in Govt. Let's have a peak at the layers of legal structures behind these archaic words.

2. When a Govt. department enters into a contract with a party, without these magic words written under your signatures, you, as a signatory and thus a party to the contract would become personally liable to the other party for any breach or damages in the contract. Imagine getting sued by a Multinational Company for a sum of a few crores of Rupees!!

3. To safeguard the interests of the officers signing contracts, there are layers of legal protections - the first layer of safeguard is the concept of "Agent and Principal" relationship or in feudal-speak "Master & servant" relationship. When you sign as "For & on Behalf of the President of India", there a lot that is common between you and 'James Bond' – both are 'Agents'.

4. "Qui facit per actum facit per se" - 'the acts of an Agent, are the acts of the Principal'.

Agent is defined as a person empowered to act on behalf of another (Principal), for the purpose of bringing the Principal into contractual relationship with a third person. There is no specific Act of Law for this relationship. However this is an ancient legal structure on which much modern legislation are founded upon. Theses legislations implicitly accept this relationship and provide for such a relationship. Indian Contract Act is one such legislation.

5. For this relationship to be proved, there must be an agreement (express or implied) between principal & Agent (not necessarily a contract). Your appointment letter, list of duties and service conditions are such an agreement. This is also covered in §299 of the Indian Constitution discussed below. Thus not all Govt. servants have authority to sign contracts on behalf of the Govt. of India – if unauthorized officers do so; they will have no protection under the law.

6. Secondly, there should be clear intention of Agent to Act on behalf of Principal. This is signaled by the "For & on Behalf of the President of India". If you forget to write this then you will not be able to claim any legal immunity. I recall that a reverse legal incident arose nearly 4 decades ago, with a veteran Stores Officer, Shri P. C. Oak, then a Deputy Director in Railway Board, when due to clerical error he signed a contract without "For & on Behalf of the President of India". Due to some other reasons the party went to court claiming huge damages. Railway found it difficult to save itself from the claim. Shri Oak, noticing the absence of the "For & on Behalf of the President of India" clause, took a plea in court that the contract is legally invalid due to absence of this phrase. The plea was upheld and Railway got saved from huge penalties. But this can as well be used by the other party to the disadvantage of Railway and the Officer signing such contracts – and the end may not be so fairy-tale like.

7. Once these two conditions in para 5 & 6 above are satisfied, Agent does not have any personal legal liability except when he: -

a. Performs without authority even with intention of helping his Principal

b. Acts against the law even if he is authorized

c. Makes false statement concerning his authority with intention to deceive or mislead

8. In the second layer of legal protection, Public Servants further derive immunity from personal liability under §299 of the constitution of India. Let's look at this article of the Constitution: -

9. §299 of the Indian Constitution

(1) All contracts made in the exercise of the executive power of the Union or of a State shall be expressed to be made by the President, or by the Governor of the State, as the case may be, and all such contracts and all assurances of property made in the exercise of that power shall be executed (for &) on behalf of the President or the Governor by such persons and in such manner as he may direct or authorise.

(2) Neither the President nor the Governor shall be personally liable in respect of any contract or assurance made or executed for the purposes of this Constitution, or for the purposes of any enactment relating to the Government of India heretofore in force, nor shall any person making or executing any such contract or assurance on behalf of any of them be personally liable in respect thereof.

10. Thus this article of the constitution is the real fountainhead for the phrase "For & on Behalf of the President of India". As for the authorising mentioned in sub-para (1) above, there is an annexure in Stores Code that lists the officers who are authorised to enter into contracts on behalf of the President of India. Please do check if your designation is listed there or in the latest revision of the same.

11. Finally this immunity is not absolute and is not available in case of the exceptions mentioned in para above – so beware!!!

Last Updated ( Tuesday, 12 August 2014 16:16 )  
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