tendering
- 1. 1
- 2. It is an invitation from the owner to the contractor to execute some work at specified cost in specified time. It is published in the form of tender notice in news papers, notice boards, leading magazines etc. according to the cost of works. 2
- 3. OR It is an offer in writing to execute some specified works or to supply some specified works or to supply some specified articles subject to certain terms and conditions like rates, time limit etc. between the contractor and the department or owner party. 3
- 4. 1. Open / Public tender– An oral talk or written document between the Engineer and the Contractor for certain small jobs to be performed. Sometimes it is advertised in India or Abroad up to 10000/- or over & compulsory for public works. 2. Sealed tender—Invited for important or huge projects; wide publicity is given; always written documents are made. 3. Single tender—Invitation is given to only one firm to render a service by quoting their rates. If the quoted rates are high, it will be negotiated prior to the agreement of the contract. 4
- 5. 4. Limited / Selected tender—This is direct invitation only to a selected no. of contractors to quote rates for supply of articles. This is ordinarily adopted in the case of all orders having estimated value less than Rs.10,000. 5. Negotiated Tender- It is advanced form of selective tender. In this negotiation is done with one or at most two contractors. 5
- 6. Procedure for inviting tender:- 1. Preparation of TENDER DOCUMENTS. 2. Issue of notice inviting tender or TENDER NOTICE/ SHORT TENDER NOTICE/ QUOTATION. 3. SUBMISSION OF TENDER and OPENING OF TENDER and SCRUTINY OF TENDER. 4. ACCEPTANCE OF TENDER / TENDER REVOCATION and award of CONTRACT. 6
- 7. 1. The notice inviting tender in specified form like PWD 6 2. Layout plan, location of work 3. Division in which location is situated 4. Schedule of quantities of work 5. Nearest road/railway link 6. Set of drawings including working drawings 7. Availability of materials in the vicinity 8. Detailed specifications or reference to standard specifications for each item of work 7
- 8. 10. Complete architectural and structural drawings 11. Schedule of tools & plant and other facilities to be made available by the owner, indicating the conditions, hire charges and place of delivery 12. Rate of supply of power and the point of supply 13. Location of water supply point 14. Time for completion and the progress to be made at intervals of time 15. Conditions regarding employment of technical personnel 16. Weather conditions in the area 8
- 9. 18. Insistence on Income tax and sales tax clearance certificate 19. Amount of Security deposit to be paid/ deducted from running bills of contractors should be notified in the tender call notice 20. Mode of payment for work done 21. Penaltyconditions forslow progressand delay in the completion of work 22. Designation of arbitration (technique for the resolution of disputes outside the courts)authority in case of disputes 23. Amount of EMD and the form in which it is to be paid 9
- 10. It is part of tender document. Tender form is printed standard form of contract giving standard conditions of contract, general rules and directions for guidance of contract. There is also a memorandum for giving 1)General description of work 2)Estimatedcost 3)Earnest money 4)Security deposit 5)Time limit in months /years 6)Column for signature of contractor before submission of tender, signature of witness to contractor’s signature and signature of the officer by whom accepted. The price of the tender form is given on the form. This printed form and other documents are to be purchased on cash payment from the office inviting tender during office hrs on all working days. 10
- 11. 11 BACK
- 12. Tender for work or supply are invited by issuing tender notice in prescribed form. Following particulars are given in the tender notice. 1. Name of the authorities(deptt.) inviting tender Exa: Govt. of Gujarat Water Resources Organisation Public Works Department (PWD), 1. Name of work and its location 2. Estimated cost 3. Last date and time of receipt of tender 4. Period of availability of tender document or validity of tender 5. Cost of tender document 6. Time of completion and type of contract 7. Earnest Money Deposit to be paid & security deposit 9. Date, time and place of opening the tender 10. Designation of the officer opening the tender 12
- 13. 13
- 14. 14 BACK
- 15. Short Tender Notice When work is to be completed very quickly or no contractor prefers to accept the work, after floating tender, then a notice with short duration is again published by the client. Such a tender notice is called “SHORT TENDER NOTICE”. The terms and conditions remain the same as that for ordinary tender notice. 15 BACK
- 16. For small jobs, owner or engineer gives an offer to the contractor for quoting rates for works and supplies required. No EMD is required for quotation. Quotation 16
- 17. It is a assurance or guarantee in the form of cash on the part of the contractor to keep open the offer for consideration and to confirm his intention to take up the work accepted in his favour for execution as per terms and conditions in the tender It is the amount of money to be deposited along with the tender document to the department by the contractors quoting a tender. In case of refusal, this amount is forfeited. EMD of contractors whose tenders are not accepted will be refunded. 1% - 2% of the estimated cost of work is the Earnest Money Deposit (EMD). 17
- 18. Restriction on unnecessary competition: contractor with low sound financial position may also submit tender with low price which may late lead to great difficulties in completion of work. Thus provision of EMD will restrict competition among sound financial contractors who are capable of completing work. Punishment: Contractors with no intension of work may quote low rates. They may be punished by forfeiting EMD. Compensation: In case if lowest contractor refuses to do work it may be allotted to second lowest contractor and EMD will be forfeited from first lowest contractor 18
- 19. Security deposit is the amount of money which is deposited by the contractor to the owner before awarding a work, whose tender has been accepted in order to render himself liable to the department to pay compensation amounting to the part or whole of his security deposit if the work is not carried according to specifications. This amounts is generally 5% to 10% of estimated cost of the project and is inclusive of the EMD already deposited by the contractor along with the tender. This will be refunded after the completion of the project. 19
- 20. The contractor has to fulfill all the terms and conditions laid down in the contract and maintain quality and speed satisfactorily. If he fails to do so, a part or whole of the SD is forfeited by the department. If there is any fault in the construction and the contractor refuses to demolish and reconstruct then the department will carry out that work using the SD. 20
- 21. Following are the main reasons for security deposit: Deposit for loans: It serves as security against the materials or the plants and machinery supplied by the department to the contractor as a loan. Punishment: on incomplete work in time, use of inferior quality of material, leaving work incomplete SD if forfeited as punishment. SD is refunded after successful completion of work with in specified time. It is refunded after the first maintenance is done which is six months. 21 BACK
- 22. Submission of Tender:- Tender shall be submitted in various envelopes from 1 to 4. ENVELOPE NO.1 This contain the EMD in the form indicated in the tender notice. ENVELOPE NO.2 Covering letter to the tender. Any comments which tenderer desires to make in form of brief statement with reference to the items, clauses and pages of the tender documents to which the comments pertain. 22
- 23. The solvency certificate from bank authorities. The latest income tax clearance certificate. A list of works of similar nature and magnitude carried out by contractor in following Performa: • Serial No. • Name of work • Cost of work • Date of commencement • Stipulated date of completion • Actual date of completion • Remarks, if any. 23
- 24. Details of plant and machinery available, which the tenderer proposes to use in this construction work in the following Performa: • Serial No. • Name of equipment • No of units • Kind of make • Capacity • Age & condition • Present location • Remarks, if any. 24
- 25. Details of technical staff who will be posted on this work by contractor, if the contract is awarded to him, in the following Performa: • Serial No. • Name of person • Technical qualifications • Experience • Remarks, if any. 25
- 26. Complete details of work in hand at the time of submission of tender in the following Performa: • Serial No. • Name of work • Date of commencement • Location • Tendered cost • Value of completed work • Stipulated (as per tender) date of completion • Anticipated (predicted) date of completion • Name of owner • Remarks, if any. 26
- 27. ENVELOPE NO.3 This contain the priced tender form with the signature of tenderer. ENVELOPE NO.4 This shall be large envelope of adequate size and it shall contain the above mentioned envelopes marked numbers 1, 2 &3. This envelope shall be properly sealed & shall be endorsed on the out side face “Tender for the name of project.” This envelope shall be deposited or mailed by registered A.D. (registered acknowledgement) , so as to reach place on or before date and time. 27 BACK
- 28. All the tenders should be sealed and submitted to the respective officer, before the time and date as mentioned in the tender notice. At the described date, time and place all the received tenders will be opened in the presence of intending tenderers or their authorised agents. The rates quoted by the various tenders shall be read out by the officer. 28
- 29. Following points should be observed while opening the tenders: 1.The tender should be opened in public at ….on …..in the office of the…..and rates will read out in presence of the owner or committee members and tenderers or their respective representative as are present. 2. If the owner is not present, the architect along with one assistant should open the tender. The architect shall scrutinize the same, prepare the comparative statements and forward them to his client, with his recommendation as to whom the work should be awarded and why. 29
- 30. 3. A record must be kept for the list of tenderers and the money deposited by them. The earnest money should preferably be accepted in the form of bank draft. 4. The lowest tender should be accepted after close investigating the reputation and standing of that contractor. 5. It is essential to ensure that they have been thoroughly checked and are without any mistakes. 30 BACK
- 31. List of all tenders received along with the details of EM received should be prepared. It should be checked that every tender should be duly signed by the contractor. The address of contractor should be clear and complete. Verification of contractor conditions should be done. Rates should be mentioned in both figures and words, both should be same, if there is any difference lowest should be accepted. 31
- 32. Calculations done by contractor and the total cost of the work should be carefully checked. After tender have been opened, a comparative statement is prepared in presence of the tender opening authority and got signed by them. Then compare the rates of various tenders in respect of each item rate against the estimated rate. Scrutiny of tender cont.… 32 BACK
- 33. Based on the comparative statement, usually the lowest tender is accepted, while accepting the tender, satisfy the the tender accepting authority shall following regarding the tenderers. 1) the financial status of each tenderer. 2) capacity to do the work. 3)past record as contractor such as experience, procurement of labourer etc. 33
- 34. For valid reason, a tender other than the lowest can be accepted. The fact is to be recorded with full reasons. A report on this to be submitted to the next higher authority. A suitable reason is also mentioned in the comparative statement. The tender accepting authority himself has to sign the comparative statement and record his remarks. Two tenders have quoted the same lowest rates. When all the tenderers have quoted abnormally high rates. Sometimes only one tenderer may respond to the tender call. Acceptance of tender 34 BACK
- 35. The owner calls tender by any means is merely (just) an offer and he is entitled to reject it without any liability. In a similar way, the law has granted protection to the contractor also. If after filling up the tender and before its acceptance by the owner, the contractor comes to know his mistake in filling or intends to withdraw from the work, the contractor is entitled to revoke (officially cancel) his tender. The section-4 & 5 of The Indian Contract Act deal with the revocation of tender. Revocation of Tender 35
- 36. Mere proof of posting the letter of acceptance by the owner before receiving the letter of revocation from the contractor will be sufficient to extinguish (put an end) the right of revocation of contractor, even if the letter be lost in the post. In some cases, it is mentioned that the successful contractor will be required to start the work and formal contract will be signed later on. In this type of cases the right of contractor to revoke his tender does not prolong (extend the duration) until the formal contract document is signed if the terms & conditions of the original tender remain unaltered. 36 BACK
- 37. "An agreement enforceable by law is a contract.” OR For a CONTRACT to be valid, there must be an offer from the owner in the form of tender notice to get some specified work to be executed and there must be an acceptance from the contractor to execute the work, both the offer and the acceptance must be definite and legal. 37 BACK