Claim Causes and Types in Indian Construction Industry - Contractor’s Perspective

Abstract

The number and frequency of claims in the current context of very complex and heavy budgeted projects in India are noticeably high which have negative impacts on the budgetary of owners and cause losses of liquidities and restrictions in cash flow for contractors. This study is conducted to determine the main causes of claims and their sources in Indian construction industry. Further, the study is conducted to determine the frequency of different claim types in Indian construction projects, and to provide recommendations and suggestions to avoid/mitigate claims in Indian construction industry. The objectives of the study have been achieved through a valid questionnaire that was distributed and obtained from different contractor’s construction organizations working in Indian construction industry. The results showed that the most important factors that contributed to the generation of claims are delay in handing over site, variation between actual and original quantities, excessive change orders by owner, delay of shop drawings approval by owner’s representative, and scope change of the project. The results also showed that the most frequent claim type in Indian construction projects is extra-work claims.