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Para 5.7.4 - Contract Acknowledgement | KartavyaDesk

WORKS_MANUAL

Original Rule Text

5.7.5 Acknowledgement of Contract by Successful Bidder and Execution After the successful bidder is notified that his bid has been accepted, he will be sent an agreement for signature and return, incorporating all agreements between the parties. The contractor should acknowledge and unconditionally accept, sign, date and return the agreement within 14 (fourteen) days from the date of issue of the contract in case of OTE and 21 (twenty-one) days in case of GTE. Such acknowledgements may not be required in low value contracts, below Rs one lakh or when the bidders offer has been accepted in entirety, without any modifications. If both parties (Procuring Entity and the contractor) simultaneously sign the contract across the table, further acknowledgement from the contractor is not required. It should also be made known to the successful tenderer that in case he does not

What This Means

Para 5.7.4 of the Works Manual outlines the procedure for formalizing a contract after a bidder wins a tender. Once the government agency (the 'Procuring Entity') informs the winning bidder that their bid is accepted, they'll send a contract agreement. This agreement includes all the agreed-upon terms and conditions. The contractor then needs to officially acknowledge, sign, date, and return this agreement within a specific timeframe: 14 days for Open Tender Enquiries (OTE) and 21 days for Global Tender Enquiries (GTE).

This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.

Key Points

  • •Successful bidders must acknowledge and sign the contract agreement.
  • •The acknowledgement timeframe is 14 days for OTE and 21 days for GTE.
  • •Acknowledgement isn't required for low-value contracts (below Rs. 1 lakh) or when the bid is accepted without changes.
  • •Simultaneous signing by both parties eliminates the need for separate acknowledgement.
  • •Failure to acknowledge and return the contract within the stipulated time can lead to consequences for the bidder.

Practical Example

The Department of Irrigation floated an Open Tender Enquiry (OTE) for the construction of a small check dam. M/s. Verma Constructions won the bid with a total project cost of Rs. 5 lakhs. The Department sent the contract agreement to Mr. Verma on July 1st, 2024. According to Para 5.7.4, Mr. Verma has 14 days from July 1st to sign, date, and return the agreement. If Mr. Verma and the department head had signed the contract together at the same table on July 1st, no further acknowledgement from Mr. Verma would be necessary. However, if Mr. Verma fails to return the signed agreement by July 15th, 2024, the Department can take action as per the tender conditions.

This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.

Frequently Asked Questions

What happens if the contractor doesn't return the signed agreement within the stipulated time?▼
Failure to return the signed agreement within the specified timeframe can lead to penalties, including forfeiture of the earnest money deposit (EMD) and potential blacklisting from future tenders.
Does this rule apply to all government contracts?▼
While Para 5.7.4 specifically addresses works contracts, similar principles of contract acknowledgement and execution are generally applicable across various types of government contracts, although the specific timelines and thresholds may vary.
What is the difference between OTE and GTE?▼
OTE stands for Open Tender Enquiry, where the tender is open to domestic bidders. GTE stands for Global Tender Enquiry, where the tender is open to both domestic and international bidders.
If there are minor changes negotiated after the initial bid, does the contractor still need to acknowledge the contract?▼
Yes, if there are any modifications to the original bid, the contractor must acknowledge and sign the final contract agreement reflecting those changes. The exception is when the original bid is accepted in its entirety without any modifications.
What constitutes a 'low value contract' in this context?▼
As per Para 5.7.4, a 'low value contract' is defined as one below Rs. 1 lakh. Acknowledgement is not required in such cases.

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 5.7.4 of the Works Manual, within how many days should a successful bidder acknowledge, sign, and return the contract agreement in the case of an Open Tender Enquiry (OTE)?

Related Rules

Para 3.2.4Manual for Procurement of Works, 2022 - Para 3.2.4 - Chapter 3Para 3.5.13Manual for Procurement of Works, 2022 - Para 3.5.13 - Chapter 4Para 3.2.6Manual for Procurement of Works, 2022 - Para 3.2.6 - Chapter 3Para 4.10Manual for Procurement of Works, 2022 - Para 4.10 - Chapter 4Para 4.11Manual for Procurement of Works, 2022 - Para 4.11 - Chapter 4

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