Para 2.6 - Bid Withdrawal Rules | KartavyaDesk
Original Rule Text
2.11 Withdrawal of an Offer or Proposal 1. In cases where the bidder has offered to keep its offer open for a specified period but without any consideration (e.g., bid security is not asked/ waived/ exempted/ not deposited, in any form), he may withdraw/ revise/ modify its offer at any time before its acceptance by the accepting authority (i.e., dispatch of the acceptance from the accepting authority, even though it may not have reached the bidder). No legal obligations shall arise from such withdrawal, revision, or modification of the offer. 2. Where, however, a bidder has agreed to keep his offer open for a specified period for a consideration (e.g., Bid Security, or Bid Securing Declaration, in any form, deposited by the bidder), then withdrawal/ revision/ modification of such an offer by the bidder before the specified period would entitle the accepting authority to forfeit the Bid Security and/ or invoke Bid Securing Declaration or any other relevant clause in this regard, in the Tender Document, for any other action. However, even in such a case, no legal obligations shall arise if such a withdrawal, revision, or modification reaches the accepting authority before the tender's opening date and time. In any case, the offer lapses automatically after the validity of the offer is over.
What This Means
Para 2.6 of the Manual for Procurement of Goods, 2017, deals with when a bidder can withdraw their offer (bid) after submitting it for a government tender. It essentially says that the rules are different depending on whether the bidder provided something of value (like a bid security deposit) to keep their offer open for a specific time. If they didn't provide any security, they can withdraw their offer anytime before the government formally accepts it.
However, if the bidder *did* provide a bid security (or a Bid Securing Declaration), things change. If they withdraw their offer before the agreed-upon period, the government can forfeit their security deposit or take other actions outlined in the tender document. There's one exception: if the withdrawal notice reaches the government *before* the tender opening date, no penalty applies. Regardless, all offers automatically expire after their validity period is over.
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Key Points
- •Bidders can withdraw offers before acceptance.
- •Withdrawal rules differ based on whether a bid security was provided.
- •Without bid security, withdrawal is allowed before acceptance without penalty.
- •With bid security, withdrawal before the specified period can result in forfeiture.
- •Offers automatically lapse after their validity period.
Practical Example
Imagine Mr. Sharma's company, 'Quality Supplies,' submits a bid for supplying stationery to the Ministry of Education. The tender document requires a bid security of ₹50,000. Quality Supplies deposits this amount. Later, Mr. Sharma realizes he underestimated his costs and wants to withdraw his bid *before* the deadline specified in the tender document. Because he provided a bid security, the Ministry of Education is entitled to forfeit the ₹50,000. However, if Quality Supplies had *not* been required to submit a bid security, they could have withdrawn their bid without penalty, as long as it was before the Ministry formally accepted their offer.
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Frequently Asked Questions
What is a Bid Securing Declaration?▼
What constitutes 'acceptance' of the offer?▼
If a bidder withdraws an offer after the tender opening date but before the validity period expires, and a bid security was submitted, what happens?▼
What happens if the bidder withdraws the offer before the tender opening date and time?▼
What happens if the validity of the offer expires?▼
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Test Your Knowledge
Question 1 of 3
According to Para 2.6 of the Manual for Procurement of Goods, 2017, under what condition can a bidder withdraw their offer without facing forfeiture of their Bid Security, even if they had submitted one?
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