Practice Area · Commercial Contracts, Manufacturing & Trade
Commercial Contract Lawyers in Gujarat: Manufacturing, Supply, Distribution and Trade Agreements
Commercial contracts, manufacturing and supply, distribution, services and international trade for multinationals and Indian subsidiaries of foreign companies, manufacturers, exporters and importers, and promoters and business families across Gujarat and India.
Who we act forRisk by sectorSupply & manufacturingDistributionInternational tradeFAQs
Key dates and figures
₹3 lakh
Minimum value of a commercial dispute heard by the Commercial Courts
45 days
Longest payment period a buyer may agree in writing with a micro or small supplier
Section 74
Indian Contract Act: reasonable compensation, up to the sum named, for breach
3× bank rate
Compound interest a buyer owes a micro or small supplier on late payment
Mahendra Bhavsar & Co. is a Gujarat-focused law firm, headquartered in Ahmedabad since 1982. Its commercial lawyers draft, negotiate and enforce the contracts that Gujarat business runs on: supply and offtake, contract manufacturing and job work, distribution, dealership, agency and franchise, services, outsourcing and logistics, and international sale and purchase with Incoterms and payment security. It also advises on the trade side of these contracts, including payment terms under FEMA and the import of plant and machinery for new facilities.
Gujarat makes and exports at scale, from chemicals, pharmaceuticals and engineering goods to electronics, renewables components, ceramics, textiles and diamonds, and much of India’s trade moves through its ports. The firm’s work follows that economy, across Ahmedabad and Gandhinagar, Sanand and Mehsana, Vadodara, Bharuch and Dahej, Surat and Vapi, Rajkot and Morbi. When a contract is breached, the same lawyers take the dispute to the Commercial Courts, arbitral tribunals, the MSME Facilitation Council, the High Court of Gujarat and the Supreme Court of India.
Who Instructs the Firm on Commercial Work
Each client type brings a different set of contracts and a different point at which money is at risk. The work is organised around those points.
Multinationals & Indian Subsidiaries
Foreign groups sourcing from, manufacturing in or selling into India.
- Indian-law review and localisation of group standard terms
- Supply, manufacturing and distribution agreements with Indian parties
- Import of plant and machinery for a new facility
- Intra-group services, licensing and cost-sharing contracts
- Governing-law, arbitration and enforcement planning
Manufacturers & Industrial Groups
Buying inputs, selling output and outsourcing production.
- Long-term supply, procurement and offtake agreements
- Contract manufacturing, job work and toll manufacturing
- Tooling, equipment, quality and warranty terms
- Price escalation, take-or-pay and force majeure
- Supplier failure, rejection and recall allocation
Exporters & Importers
Selling and buying across borders through Gujarat’s ports.
- International sale and purchase contracts and Incoterms
- Letters of credit, bank guarantees and credit insurance
- Overseas agency and distribution
- FEMA rules on export proceeds and import payments
- Foreign buyer default and cross-border recovery
Promoters & Business Families
Long-standing relationships that were never put in writing.
- Written contracts for customers, suppliers and dealers
- Dealer and distributor network restructuring
- Exclusivity and restraint terms that hold up in court
- Contracts with group companies and related parties
- Renegotiation, settlement and exit
Service Buyers & Global Capability Centres
Services, outsourcing and operations contracts.
- Master services agreements and statements of work
- Business-process and facilities outsourcing
- Logistics, warehousing and fulfilment contracts
- Service levels, change control and exit
- Subcontracting and vendor management
Public Bodies & Concession Holders
Authorities and private operators working together.
- Concession, operation and service agreements
- Performance standards and payment mechanisms
- Variation, termination and handback
- Disputes between authorities and operators
- Tender-linked contract terms
How the Firm Works
The firm’s senior lawyers lead its work. A matter begins with an understanding of the client’s objective and the issues in play, and the firm looks at it as a whole, so each step is taken with the next one in mind.
Commercial Risk in Gujarat's Key Sectors
For a business, the expensive moments are predictable: a plant that is late, a batch that is rejected, a buyer abroad who stops paying, a supplier that fails, or a distributor that has to be replaced. The contract decides who carries that loss. Mahendra Bhavsar & Co. drafts with those moments in view, sector by sector, and acts when they arrive. See also the firm’s work by industry.
Chemicals and Petrochemicals
Dahej, Bharuch, Ankleshwar, Vapi and Hazira. Feedstock and offtake, toll manufacturing, technology licences, storage and terminal contracts. Risk sits in commissioning delay, off-spec product, contamination, shutdown loss and bank guarantees.
Pharmaceuticals and APIs
Ahmedabad, Vadodara, Ankleshwar and Vapi. Contract manufacturing and quality agreements, technology transfer, licensing and distribution. Risk sits in batch rejection, supply interruption, failed technology transfer and recall costs.
Engineering, Automotive and Advanced Manufacturing
Sanand, Vadodara-Halol, Rajkot and Surat. Supply, OEM, tooling, equipment and installation contracts. Risk sits in defects, warranty claims, tooling ownership, price escalation and export payment.
Semiconductors and Electronics
Dholera, Sanand and the Ahmedabad-Gandhinagar corridor. Equipment purchase and installation, clean-room construction, gases and chemicals supply, technology and confidentiality terms. Risk sits in delay, yield and performance, contamination and liquidated damages.
Renewables, Green Hydrogen and Storage
Saurashtra and North Gujarat. Module, turbine and battery supply, EPC, O&M and offtake contracts. Risk sits in delay and liquidated damages, equipment defects, performance shortfall and payment security.
Ports, Logistics and International Trade
Mundra, Kandla, Hazira, Pipavav and Dahej. Sale of goods, agency, inspection, freight, warehouse and terminal contracts. Risk sits in buyer non-payment, rejected goods, letter of credit discrepancies, cargo loss and demurrage.
Supply, Procurement and Offtake Agreements
A long-term supply contract has to survive price movements, quality failures and interruptions in supply. Mahendra Bhavsar & Co. drafts and negotiates master supply, procurement and offtake agreements for buyers and suppliers, covering volumes and forecasts, take-or-pay, price formulas and escalation, specifications, inspection and acceptance, payment security, warranties, indemnities, limits of liability, insurance and force majeure.
Where the supplier is a micro or small enterprise, the payment terms are set with the statute in view. A buyer must pay on the agreed date, and the agreed period cannot exceed 45 days from acceptance; late payment carries compound interest, and the supplier can take the dispute to the Micro and Small Enterprises Facilitation Council. Central public sector enterprises buying from micro, small and medium enterprises must also settle the invoices through a Reserve Bank-authorised receivables discounting (TReDS) platform.
Contract Manufacturing, Job Work and Toll Manufacturing
Manufacturing arrangements decide who owns the materials, the tooling, the know-how and the finished goods at each stage, and who pays when a batch fails. The firm acts on OEM and contract manufacturing, job work and toll manufacturing, private-label production, customer-owned tooling and equipment, quality, recall and product-liability allocation, capacity commitments, and intellectual property and confidentiality. Technology licensing into a Gujarat plant is handled with the firm’s technology, data and IP lawyers, and the tax treatment of job-work structures is settled alongside the commercial terms.
Distribution, Dealership, Agency and Franchise Agreements
Distribution and agency contracts set territory, exclusivity, targets, pricing and brand use and, above all, what happens when the relationship ends. The firm advises principals, distributors, dealers, agents and franchisors on appointment, performance obligations, brand licences, termination, inventory buy-back and transition to a new channel, and on restructuring a dealer network across India. Restraints that bite after the agreement ends are drafted with section 27 of the Indian Contract Act, 1872 in view, and exclusive arrangements are checked against competition law where the market position calls for it.
Services, Outsourcing and Logistics Contracts
Services and outsourcing contracts turn on scope, service levels, people, data and exit. The firm acts on consultancy and services agreements, managed services and business-process outsourcing, facilities and operations outsourcing, subcontracting, and storage, warehousing, fulfilment and freight contracts, including custody, risk, insurance and loss allocation. Contracts for global capability centres and technology services are prepared with the firm’s technology lawyers.
International Sale and Purchase: Incoterms, Governing Law and Payment Security
International sale contracts fail most often on three points: which law applies, where disputes go, and how the seller gets paid. India is not a party to the UN Convention on Contracts for the International Sale of Goods (CISG), so the contract itself should choose the governing law. Mahendra Bhavsar & Co. drafts and negotiates international sale and purchase contracts, Incoterms delivery terms, payment security through letters of credit, bank guarantees, advance terms and credit insurance, cross-border agency and distribution, and arbitration and governing-law clauses that can be enforced where the counterparty has assets. Trade and export finance documents are handled with the firm’s banking and finance lawyers, and contracts for foreign groups entering India link to the firm’s international practice.
Contract Terms That Decide Disputes in India
A handful of rules decide most commercial disputes in India. A contract drafted with them in mind is easier to enforce and harder to escape.
Position as at 5 November 2026
- Agreed damages. Under section 74 of the Indian Contract Act, 1872, a court awards reasonable compensation up to the sum named in the contract, not the named sum automatically. A liquidated damages clause should show how the figure was reached.
- Restraints. An agreement that restrains anyone from carrying on a lawful business is void under section 27, with a narrow exception for the sale of goodwill. Exclusivity during the contract is treated differently from a restraint after it ends.
- Small suppliers. Payment within the agreed period, never more than 45 days from acceptance; compound interest on late payment; and a statutory route to the Micro and Small Enterprises Facilitation Council.
- Commercial Courts. Disputes of a specified value of ₹3 lakh or more go to the Commercial Courts and, unless urgent interim relief is sought, begin with pre-institution mediation.
- Stamp duty. An agreement signed outside Gujarat and brought into the State must be stamped in Gujarat within the time the Gujarat Stamp Act, 1958 allows.
- Arbitration. An arbitration clause should name the seat clearly; an Indian court can grant interim relief even in a foreign-seated arbitration unless the parties have excluded it.
Contract Life, Notices and Commercial Disputes
Most commercial disputes begin as a contract that did not say what happens next: when prices moved, when a part failed, when a buyer abroad stopped paying, or when a distributor was let go. The firm reviews contract risk, prepares playbooks and standard terms for group use, and advises on variations and change control, default and cure notices, termination, evidence and claims, and renegotiation and settlement. It prepares a commercial dispute for mediation, from reconciling accounts and quality records to a chronology, a case assessment and a mediation brief.
When a dispute cannot be settled, the firm’s litigation and arbitration lawyers take it forward: suits and applications for interim relief before the Commercial Courts, MSME references, domestic and international arbitration, the enforcement of foreign awards and judgments in Gujarat, and appeals to the High Court of Gujarat and the Supreme Court of India. Disputes between shareholders or joint-venture partners are handled with the firm’s corporate lawyers.
Imports of Plant and Machinery for New Facilities
A new factory in India usually needs imported plant and machinery, and the import route fixes the duty cost, the cash flow and the obligations that run for years afterwards. Mahendra Bhavsar & Co. advises manufacturers, foreign groups and joint ventures on the customs and foreign-trade law behind those imports, from the route plan to the closing of the project file. Bills of entry and shipping bills are filed by the importer’s licensed customs broker, and the firm works with the broker on the legal points.
Project Imports
Registration of a project contract under heading 9801 and the Project Imports Regulations, 1986; the duty position; and finalisation of the project file.
Bonded Manufacturing (MOOWR)
Manufacturing in a customs-bonded warehouse with duty deferred on capital goods and inputs, and the options on export or domestic clearance.
EPCG and Advance Authorisation
Duty-saving schemes under the Foreign Trade Policy: eligibility, export obligation, extension, redemption and regularisation.
Joint-Venture and Second-Hand Imports
Who is importer of record, related-party valuation, transfer of goods to the joint venture, and policy and inspection points for used plant.
Classification, Valuation and Rulings
Classification opinions and advance rulings, related-party valuation, royalty loading, free trade agreement origin claims and concessional end-use imports.
Trade Payments and Compliance
FEMA rules on export realisation and import payments through the authorised dealer bank, customs compliance reviews before an audit, refunds and re-export.
Experience
Commercial and Trade Work the Firm Handles
Mahendra Bhavsar & Co. acts across the whole life of commercial and trade matters in Gujarat and India, from the first term sheet to enforcement. Its work for multinationals, manufacturers, exporters, importers, public bodies and business families includes:
- multi-party manufacturing and supply agreements between Indian manufacturers, exporters and foreign buyers, covering quality, packing, rejection of defective goods, risk, payment, exclusivity and termination;
- long-term supply, procurement and offtake programmes for new and expanding plants;
- distribution, dealership, agency and franchise structures for foreign groups entering the Indian market, and the restructuring of dealer networks;
- software development, services and outsourcing agreements for technology principals abroad;
- concession, operation and service agreements between public authorities and private operators;
- the import of plant and machinery for joint ventures and new facilities in Gujarat, from the route plan to the closing of the project file;
- governing-law, arbitration and alternative-forum clauses for trading companies abroad;
- interim measures in support of arbitration, jurisdiction objections and MSME proceedings, with related petitions before the High Court of Gujarat.
The same approach serves the larger mandates now arising in Gujarat: supply and offtake programmes for semiconductor, electronics, chemicals and renewables projects, manufacturing and distribution structures for foreign groups entering India, and the import route for every new facility.
Working with Other Advisers
Mahendra Bhavsar & Co. works with a network of affiliated firms of chartered accountants and company secretaries, and with established advocates across Gujarat. Indirect-tax credit, accounts and return filings sit with the affiliated chartered accountants as one team and one timetable; entries are filed by the importer’s licensed customs broker. Trade-remedy, export-control, maritime and technical questions are taken with the relevant advisers, and the firm’s lawyers frame the question and bring the answers into the contract.
Across Gujarat’s industrial corridors. Supply, manufacturing, EPC and trade contracts for plants at Sanand, Dholera, Dahej, Bharuch–Ankleshwar and Vadodara–Savli, and for exporters and traders using Mundra, Kandla and Hazira, are set out sector by sector on the firm’s industries page, with the corridors where each sector sits. Land and premises for a new facility are handled with the firm’s real estate lawyers, and supply arrangements inside a family business with its succession and family business lawyers.
Related Insights from the Firm
Articles by the firm on the points this practice deals with.
What You Will Usually Need to Provide
To advise on a commercial contract, trade or customs matter, the firm will usually ask for:
- a short note of the business, the counterparty and its country, and what the contract must achieve;
- the draft or existing contract, purchase orders, standard terms and side letters;
- for a dispute: the correspondence, invoices, delivery and quality records, and any notice sent or received, with dates;
- for an import: the project plan, the supply contract and equipment list, the proposed importer of record, and any export commitments;
- the outcome the business needs, and any deadline it faces.
The firm first checks for conflicts of interest. Please do not send confidential papers until the firm confirms it can act.
Questions on Commercial Contracts, Trade and Customs
Position as at 5 November 2026.
What is the purpose of a supply agreement?
A supply agreement fixes what is supplied, in what quantity, at what price, to what specification and on what payment terms, and what happens when any of those goes wrong. For a long-term relationship it also sets price review, forecasting, acceptance, warranties, limits of liability and termination. Without it, the parties fall back on general contract law and on whatever their correspondence shows.
What is a C&F agreement?
In Indian trade usage, a C&F agreement is a carrying and forwarding agreement: the agent receives goods from the principal, stores them and dispatches them to dealers or customers, usually for a commission. The agreement should deal with custody and risk of the stock, insurance, records, receipt of customer payments, indemnities and the return of goods on termination. Its tax treatment is settled with the client’s tax advisers.
What is section 27 of the Indian Contract Act?
Section 27 makes void any agreement that restrains a person from carrying on a lawful profession, trade or business, with a narrow exception for the sale of goodwill. Exclusivity and non-compete terms that operate during a contract are treated differently from restraints that bite after it ends.
Will a court enforce a liquidated damages clause in full?
Not automatically. Under section 74 of the Indian Contract Act, 1872, the court awards reasonable compensation up to the sum named, so the clause should be a genuine pre-estimate of loss and the contract should show how it was reached.
What is the difference between job work and contract manufacturing?
In job work the customer supplies the materials and keeps ownership while the processor works on them. In contract manufacturing the manufacturer usually buys the inputs and sells the finished goods to the customer. The difference affects ownership, risk, insurance and tax, so it is settled in the contract at the start.
Can a distributor claim compensation when the agreement is ended?
Indian law has no general statute giving distributors compensation on termination. Claims usually turn on the notice and termination terms in the contract and, where the contract is silent, on what notice was reasonable. Clear exit terms, including inventory buy-back and transition, do most of the work.
How can a new factory import plant and machinery at lower upfront duty?
There are several routes: project import registration under heading 9801, bonded manufacturing under MOOWR that defers duty, an EPCG authorisation tied to an export obligation, and concessional end-use imports. Each carries conditions and continuing obligations, and the choice depends on the project, the export plan and the cash flow.
What can an exporter do when an overseas buyer does not pay?
Start with the payment security: a letter of credit, bank guarantee or credit insurance. Then look at the dispute clause and where the buyer has assets. The FEMA rules on realising export proceeds also apply, and the authorised dealer bank must be kept informed.
Does the CISG apply to a contract with an Indian company?
Not automatically. India is not a party to the UN Convention on Contracts for the International Sale of Goods (CISG), so the Convention does not apply to a sale with an Indian buyer or seller unless the contract chooses the law of a country that has adopted it. A contract with an Indian party should state its governing law and how disputes are resolved; where Indian law governs, the Sale of Goods Act, 1930 and the Indian Contract Act, 1872 apply.
Is an exclusive distribution agreement valid in India?
Generally yes. Exclusivity during the term of a distribution agreement is usually upheld as a reasonable commercial restriction, but a clause that stops the distributor competing after the agreement ends is usually void under section 27 of the Indian Contract Act, 1872. Exclusive arrangements can also be examined under competition law if they cause an appreciable adverse effect on competition in India.
What interest is payable on late payment to a micro or small supplier?
Under the MSMED Act, 2006, a buyer who pays late owes compound interest with monthly rests from the day after payment was due, at three times the bank rate notified by the Reserve Bank of India, whatever the contract says. The supplier can also refer the dispute to the Micro and Small Enterprises Facilitation Council.
Which court hears a commercial contract dispute in Gujarat?
Commercial disputes of a specified value of ₹3 lakh or more are heard by the Commercial Courts constituted in the districts of Gujarat, including at Ahmedabad, after pre-institution mediation unless urgent interim relief is sought. Appeals lie to the High Court of Gujarat. Disputes under an arbitration agreement go to arbitration, with the courts supporting and supervising it.
Discuss a commercial contract or trade matter with the firm
Tell the firm about the business, the counterparty and the contract you need or the problem that has arisen.