What is Administrative Service Agreement?

An Administrative Services Agreement (ASA) is a legally binding contract between a service provider and a client organization that outlines the terms under which the provider will perform administrative, operational, or back-office functions.

In simple terms, it defines who does what, for how much, and under what conditions — ensuring smooth business operations without confusion or risk.

In India, Administrative Services Agreements are governed by the Indian Contract Act, 1872 and are commonly used by companies, startups, BPOs, accounting firms, HR agencies, and corporate groups that outsource or centralize administrative support.

Without an ASA, you risk unclear responsibilities, data mishandling, and legal disputes over service quality or payment obligations.

Free Administrative Services Agreement Template | Download & Customize

This template is:

Lawyer-drafted and compliant with the Indian Contract Act, 1872. Suitable for corporates, startups, and service providers. Customizable for HR, finance, IT, or back-office functions

Types of Administrative Services Agreements

Corporate Shared Services Agreement

A parent company provides administrative support to its subsidiaries.

Example: A holding company offering HR and accounting services to group entities.

Third-Party Services Agreement

An external firm handles administrative or operational tasks.

Example: A startup outsourcing payroll or data processing to a professional agency.

Intercompany Services Agreement

Used between related entities (e.g., Indian subsidiary and foreign parent) for cost-sharing and compliance.

Example: A multinational using an Indian subsidiary for global back-office operations.

How to Use This Administrative Services Agreement Template?

• Identify the Parties – Include complete legal details of both the service provider and client.
• Define Scope of Services – Clearly describe the administrative functions covered (HR, finance, IT, etc.).
• Outline Service Levels (SLAs) – Specify performance metrics, response times, and quality standards.
• ⁠Clarify Fees & Payment Terms – Mention service charges, invoicing schedule, and payment timelines.
• ⁠Include Confidentiality & Data Protection Clauses – Especially important if sensitive data is involved.
• Set Term & Termination – Define duration, renewal, and termination notice periods.
• ⁠Add Dispute Resolution Clause – Mention arbitration or jurisdiction for resolving conflicts.
• ⁠Sign & Execute – Digital or physical signatures are valid under the Information Technology Act, 2000.

Legal Context in India

An Administrative Services Agreement is legally enforceable under the Indian Contract Act, 1872, and may also be subject to data protection, taxation, and labor laws, depending on the services provided.

• If either party breaches the agreement, the affected party can seek:
• Damages for financial losses or service disruption
• Termination for non-performance
• Injunctions for confidentiality breaches

Courts uphold ASAs that are clear, balanced, and specific, particularly where financial and data obligations are well-defined.

Why Businesses Need an Administrative Services Agreement?

Defines Responsibilities Clearly – Avoids confusion and overlap in roles.

Ensures Service Quality – Sets measurable performance standards and accountability.

Protects Confidential Information – Includes NDAs and data privacy terms.

Supports Compliance – Aligns with company law, tax, and labor regulations.

Reduces Legal Risk – Provides clear remedies for delay, default, or negligence.

Industry-Specific Use Cases

Startups & SMEs – Outsource HR, payroll, and accounting functions.

Large Corporations – Implement shared services across departments or group entities.

Consulting & BPO Firms – Offer client-focused administrative outsourcing.

Healthcare & Education Institutions – Manage back-office operations efficiently.

IT & SaaS Companies – Delegate non-core administrative functions to third parties.

FAQs on Administrative Services Agreements in India

Q1. Are Administrative Services Agreements legally enforceable in India?

Yes. They are enforceable under the Indian Contract Act, 1872, provided terms are lawful and specific.

Q2. What should an ASA include?

Scope of services, payment terms, SLAs, confidentiality, indemnity, and termination clauses.

Q3. Can services be outsourced to foreign entities?

Yes, but cross-border service agreements must comply with FEMA, GST, and data protection regulations.

Q4. How long does an ASA last?

Usually 1–3 years, with options for renewal depending on business needs.

Q5. Are e-signatures valid on ASAs?

Yes. Under the Information Technology Act, 2000, digital signatures are fully valid in India.

Q6. What happens in case of breach?

The non-breaching party can claim damages, terminate the contract, or seek arbitration as per the agreement.

Related Templates You May Need

Service Level Agreement (SLA)

Consultancy Agreement

Non-Disclosure Agreement (NDA)