What is Retention Money ? Any undated cheque issued to any of the supplier as an security amount can be considered as Contingent liability ?

Payment for a service or product that is withheld pending the completion of some specified condition. For example, when a manufacturing business purchases production machinery from a supplier, they might withhold some percentage of payment due as retention money until the machines are successfully installed and operational.

In case of constructing contract also a certain percentage of money is withheld in each stage of completion as per the Contracting terms in order to assure the full completion of the project.

Issue of undated cheques: Though such a practice is followed in certain cases, it is not a generally accepted practice according to according to accounting standards and for its purpose. The issuers have a control over the cheque in many ways, that is why it mutually agreed...and it is not a contingent liability because the liability coming out of it not  from an uncertain event as in case of legal decisions.

Retention Money is that part of money which is withhold on a contract,which will paid after the performance/completion of a fixed period.

- Retention of Money. The amount which is withheld just as security till the execution and completion of an order/project/contract. 

- Considering issued cheque as contingent liability is not an appropriate practice as per Internally Accepted Accounting Standard. Anyhow, it may be a locally accepted practice. 

Yes, I agree with the answers mentioned

I Fully Agreed Answer of Mr.VENKITARAMAN KRISHNA MOORTHY VRINDAVAN  

AGREE WITH MR VENKITARAMAN ANSWER 

agree with mr.patel