Chapter VII CONTRACTS

Subject to the provisions of this Chapter, every Board shall be competent to enter into and perform any contract necessary for the purposes of this Act.

1. (1) Every contract--
   • (a) for which budget provision does not exist, or
   • (b) which involves a value or amount exceeding rupees fifty thousand shall require the sanction of the Board.
2. (2) Every contract other than a contract such as is referred to in sub-section (1) shall be sanctioned by the Chief Executive Officer on behalf of the Board.

1. (1) Every contract made by or on behalf of a Board, the value or amount of which exceeds fifty thousand rupees, shall be in writing, and every such contract shall, be signed by two members, of whom the President or the Vice-President shall be one, and be countersigned by the Chief Executive Officer and be sealed with the common seal of the Board.
2. (2) Where the Chief Executive Officer executes a contract on behalf of the Board sanctioned under sub-section (2) of section 127, he shall submit a report, on the execution of the contract, to the Board at its next meeting.

If any contract is executed by or on behalf of a Board, otherwise than in conformity with the provisions of this Chapter, it shall not be binding on the Board.