Works Contract
description
Transcript of Works Contract
![Page 1: Works Contract](https://reader035.fdocuments.net/reader035/viewer/2022062301/56813ff3550346895dab0df2/html5/thumbnails/1.jpg)
Works Contract
M. B. Vijay
Sr. Professor Civil Engineering
![Page 2: Works Contract](https://reader035.fdocuments.net/reader035/viewer/2022062301/56813ff3550346895dab0df2/html5/thumbnails/2.jpg)
CONTRACTS FOR WORKS
– Common intention– Agreement enforceable by law– Free consent, competency to contract, lawful
consideration.
![Page 3: Works Contract](https://reader035.fdocuments.net/reader035/viewer/2022062301/56813ff3550346895dab0df2/html5/thumbnails/3.jpg)
Purpose of works Contracts:
• Zone Works• Special Works• Supplies of Building Materials.
![Page 4: Works Contract](https://reader035.fdocuments.net/reader035/viewer/2022062301/56813ff3550346895dab0df2/html5/thumbnails/4.jpg)
– Lump Sum– Schedule– Piece Work/Unit rate
Forms of Contracts.
![Page 5: Works Contract](https://reader035.fdocuments.net/reader035/viewer/2022062301/56813ff3550346895dab0df2/html5/thumbnails/5.jpg)
Type of Tender
• Open Tender
• Limited Tender
• Single tender
• Dispense with calling of tender- Quotation
![Page 6: Works Contract](https://reader035.fdocuments.net/reader035/viewer/2022062301/56813ff3550346895dab0df2/html5/thumbnails/6.jpg)
– From approved list.– Otherwise standing list.– Through wide publicity.
• Provided - Enlistment is dynamic.
Limited Tender
![Page 7: Works Contract](https://reader035.fdocuments.net/reader035/viewer/2022062301/56813ff3550346895dab0df2/html5/thumbnails/7.jpg)
Single Tenders.
– For Restoration Works of Accidents, Breaches and Other Emergencies & For Works of Specialised Nature. –
– Shifting Target Dates for Works Like GC/Urgency Invite Special Limited Tenders.
– Selection of Agency From Approved List Except for Specialised Nature of Work.
– Spell Detailed Reasons.– Prior Finance Concurrence Before Adm. Approval
• PHODS - Up To Rs.20 Lakh, Annual Limit Rs.1 Cr. DRMS - Up To Rs.10 Lakh, Annual Limit Rs.50 Lakh.
– TC And Accepting Authority be One Step Higher Except Where GM is Accepting Authority.
![Page 8: Works Contract](https://reader035.fdocuments.net/reader035/viewer/2022062301/56813ff3550346895dab0df2/html5/thumbnails/8.jpg)
Quotations
• Not for Items Which can be Executed Through Existing Contracts Including Zone Contracts– Not For Fancy Items.– Only For Works of Urgent Nature– Quotations Form at Least 3 Contractors.– Genuine Firms.
• Dispense Calling of Tenders./Accept Quotations.• Rly Bd’s Letter NO.90/CE-I/CT/1 DT.14.12.90
![Page 9: Works Contract](https://reader035.fdocuments.net/reader035/viewer/2022062301/56813ff3550346895dab0df2/html5/thumbnails/9.jpg)
Type of tender to get best price for the government
money
![Page 10: Works Contract](https://reader035.fdocuments.net/reader035/viewer/2022062301/56813ff3550346895dab0df2/html5/thumbnails/10.jpg)
Framing Contract Agreement:
– Terms: Precise, Definite, Detail.– What Contractor is to do: When, Where, To
whose satisfaction.– What Railway To do: When, on what terms.– Payment: What it is to cover, to whom, when,
method & Basis.– Responsibilities of contractor: Supervision,
Care of Government Property, Safety, Laws in force.
– Terms of modification, variations.
![Page 11: Works Contract](https://reader035.fdocuments.net/reader035/viewer/2022062301/56813ff3550346895dab0df2/html5/thumbnails/11.jpg)
Pre-tendering home work:
![Page 12: Works Contract](https://reader035.fdocuments.net/reader035/viewer/2022062301/56813ff3550346895dab0df2/html5/thumbnails/12.jpg)
• How much time is spend on making a tender schedule
• Do you look into details of schedule.
• Spent time on pretender.
• Value addition by you.
What is your role?
![Page 13: Works Contract](https://reader035.fdocuments.net/reader035/viewer/2022062301/56813ff3550346895dab0df2/html5/thumbnails/13.jpg)
Pre-tendering home work:
• Prepare detailed specification and • Properly drafted tender schedule
• Contractor wants to maximize profit.• Drawing not finalized.
• Material Not available which is to be given by Rly.
• Detailed Investigation Like Soil Exploration• Infringements - DOT, Tree, Services.
![Page 14: Works Contract](https://reader035.fdocuments.net/reader035/viewer/2022062301/56813ff3550346895dab0df2/html5/thumbnails/14.jpg)
Documents forming integral part of contract document:
– Conditions- Standard, Special.– Specifications.– Plans.– Schedule of items, quantity, Rates.– Agreement form.– Tender Form.– Instructions to tenderers.
![Page 15: Works Contract](https://reader035.fdocuments.net/reader035/viewer/2022062301/56813ff3550346895dab0df2/html5/thumbnails/15.jpg)
Sale of Tender Documents.
– Adequate time between invited and opened.
• > 15 Days Before Date of Opening.
• RLY BD’s LETTER No.93/CE-I/CT/85 Dt.9.5.94.
![Page 16: Works Contract](https://reader035.fdocuments.net/reader035/viewer/2022062301/56813ff3550346895dab0df2/html5/thumbnails/16.jpg)
• Tenders Unaccompanied With EM.
• Summarily Reject Offer
• No Discretion Permitted.– RLY BD’s LETTER No.66/WI/CT/22/A
Dt.20.5.67.
• Standing Earnest Money.
Earnest Money & Security Deposit.
![Page 17: Works Contract](https://reader035.fdocuments.net/reader035/viewer/2022062301/56813ff3550346895dab0df2/html5/thumbnails/17.jpg)
• Submission of tenders
• Opening of tenders
• Comparative statement & Briefing note.
• Constitution Of T.C
• Acceptance of tender.
• Signing of agreement.
• Custody of Security Deposits.
Tender Procedures.
![Page 18: Works Contract](https://reader035.fdocuments.net/reader035/viewer/2022062301/56813ff3550346895dab0df2/html5/thumbnails/18.jpg)
Disputes
• Unresolved
• Delay in completion
• Arbitration.
![Page 19: Works Contract](https://reader035.fdocuments.net/reader035/viewer/2022062301/56813ff3550346895dab0df2/html5/thumbnails/19.jpg)
Submission of tenders
• To Cater Anti Social Elements Tender Submission Permitted at More Than One Place.
» RLY BD’s LETTER No.90/CE-I/CT/1 Dt.28.10.98.
![Page 20: Works Contract](https://reader035.fdocuments.net/reader035/viewer/2022062301/56813ff3550346895dab0df2/html5/thumbnails/20.jpg)
Opening of tenders
• Precautions during opening.• Before all the tenderers or their representatives• Tender opening register enter information and
sign• Tender On proper tender form• Signed by authorised representative• Corrections to be encircled and signed• Comparative statement & Briefing note.• To be serially numbered
![Page 21: Works Contract](https://reader035.fdocuments.net/reader035/viewer/2022062301/56813ff3550346895dab0df2/html5/thumbnails/21.jpg)
Reasonability of Rates.
• Be Examined in Detail By TC.
– For Comparison Avg. of Last Accepted Rates for Similar Works, Similar Conditions and Geographical Proximity be Worked Instead of Latest Last Accepted Rates.
– Where Only One Accepted Rate is Available, Analysed Rates Based on Market Survey be Derived.
![Page 22: Works Contract](https://reader035.fdocuments.net/reader035/viewer/2022062301/56813ff3550346895dab0df2/html5/thumbnails/22.jpg)
• We apply mind when offer received not in the beginning.
• Rate of analysis done after opening of tender.
• Not always reliable.– Rates may be going down.– Assumed inflation 10% not realistic.
• Rates analysis based on Rates opened but not finalized –never
Rate Analysis
![Page 23: Works Contract](https://reader035.fdocuments.net/reader035/viewer/2022062301/56813ff3550346895dab0df2/html5/thumbnails/23.jpg)
• Don’t change eligibility criteria in the mid of process.
• after opening- never.• Eligibility criteria should not be unduly restrictive- should
be discussed in file- should not be tailor made.
Change in acceptance criteria
![Page 24: Works Contract](https://reader035.fdocuments.net/reader035/viewer/2022062301/56813ff3550346895dab0df2/html5/thumbnails/24.jpg)
Credentials
• Eligibility Criteria for Each Work be Specified in Tender Notice it Self.
• Tender Notice & Tender Document should match. (Eligibility criteria)
• To be Ascertained By TC
– Check for False or not relevant credential.
![Page 25: Works Contract](https://reader035.fdocuments.net/reader035/viewer/2022062301/56813ff3550346895dab0df2/html5/thumbnails/25.jpg)
Role of convener
• He must fully brief TC
• Full knowledge of work
• Market survey for work analysis
• Time frame
• Urgency
• Specifications
• Site conditions
![Page 26: Works Contract](https://reader035.fdocuments.net/reader035/viewer/2022062301/56813ff3550346895dab0df2/html5/thumbnails/26.jpg)
Constitution Of T.C.
• Normally TC consists of three members– Convener- user department also expected to
be expert in the given subject
• A finance member a person from associate finance deptt
• A Third member any other technical department
![Page 27: Works Contract](https://reader035.fdocuments.net/reader035/viewer/2022062301/56813ff3550346895dab0df2/html5/thumbnails/27.jpg)
Finance Member in TC
• Tenders are on properly issued form
• Signed by authorised person
• All tenders are correctly filled
• Corrections have been initialed by tender opening officials
• Tenders have been opened correctly
• Earnest money in requisite and in acceptable form
![Page 28: Works Contract](https://reader035.fdocuments.net/reader035/viewer/2022062301/56813ff3550346895dab0df2/html5/thumbnails/28.jpg)
• All valid tenders are serially placed in the comparative statement
• Briefing not duly vetted
• All special conditions have been mentioned and their financial implications have been correctly evaluated
• Arithmetical accuracy of the offer
![Page 29: Works Contract](https://reader035.fdocuments.net/reader035/viewer/2022062301/56813ff3550346895dab0df2/html5/thumbnails/29.jpg)
• Proper rate analysis has been done and placed on record by convener
• Fund position• if the work is sanctioned• Partnership deed and other legal issues
have been examined• Consistent approach has been taken in
dealing with all similar cases as he is common member.
![Page 30: Works Contract](https://reader035.fdocuments.net/reader035/viewer/2022062301/56813ff3550346895dab0df2/html5/thumbnails/30.jpg)
• Relying on - A/c-wrong.– Play positive role.– Moderator.– See independently.– Spent time.
Third Member
![Page 31: Works Contract](https://reader035.fdocuments.net/reader035/viewer/2022062301/56813ff3550346895dab0df2/html5/thumbnails/31.jpg)
TC as a whole
• Definite recommendation bringing out all known facts
• Basis of recommendations
• Authority competent to consider recommendations
• Delays to be Explained by TC in Minutes.
![Page 32: Works Contract](https://reader035.fdocuments.net/reader035/viewer/2022062301/56813ff3550346895dab0df2/html5/thumbnails/32.jpg)
TAA
• Work is essentially required• Reasonableness of offer has been properly
examined by TC• Full opportunity has been given and • There is adequate response
![Page 33: Works Contract](https://reader035.fdocuments.net/reader035/viewer/2022062301/56813ff3550346895dab0df2/html5/thumbnails/33.jpg)
– Where Officer In Whose Competence Acceptance of Tender Lies is a Member Of T.C., The Minutes be Put Up To Next Higher Office (And Not To Colleagues).
• Information through Tender Committee Not directly- Like President.
• Consistency at different times.
![Page 34: Works Contract](https://reader035.fdocuments.net/reader035/viewer/2022062301/56813ff3550346895dab0df2/html5/thumbnails/34.jpg)
Execution
• Not taking timely decision.
• Lack of will power.
• Fancy decision.
• Lack of Coordination amount different department.
![Page 35: Works Contract](https://reader035.fdocuments.net/reader035/viewer/2022062301/56813ff3550346895dab0df2/html5/thumbnails/35.jpg)
• Avoid Changes in Designs and Foundations• Variation in quantities• Don’t change quantities.
– Increase in cost.– Delay– Loss of earnings.– Vitiation– Arbitration
Contract without proper preparation.
![Page 36: Works Contract](https://reader035.fdocuments.net/reader035/viewer/2022062301/56813ff3550346895dab0df2/html5/thumbnails/36.jpg)
Other issues
• Law and order - Labour.
• Political• Understand the culture of the place where you
are working.• Rates cannot come to rescue if the canons of
financial propriety are defied• Sweeping changes in the work ethos can only
be brought with due consultation
![Page 37: Works Contract](https://reader035.fdocuments.net/reader035/viewer/2022062301/56813ff3550346895dab0df2/html5/thumbnails/37.jpg)
• Without test check.• Overpayment.• Fraudulent payment.• Specially When officer transferred/
new/ fresh.
ON account payment
![Page 38: Works Contract](https://reader035.fdocuments.net/reader035/viewer/2022062301/56813ff3550346895dab0df2/html5/thumbnails/38.jpg)
In one case of track renewal
• 200-300% variation in transportation without track renewal work being executed.– 8 times the normal rates justified on SOR
rates.
• Deletion of items - Without reason- Undue benefit- To contractor.
![Page 39: Works Contract](https://reader035.fdocuments.net/reader035/viewer/2022062301/56813ff3550346895dab0df2/html5/thumbnails/39.jpg)
– Cement & Steel Shoud be Supplied by Contractors in Case Railway is to Supply Free of Cost, its Quantites Should be Fixed. Rates of Recovery for Variation in Quantities Should be Incorporated.
Supply of Material
![Page 40: Works Contract](https://reader035.fdocuments.net/reader035/viewer/2022062301/56813ff3550346895dab0df2/html5/thumbnails/40.jpg)
Materials Issued to Contractors
– Recovery for Excess @ 1.5 Times Cost of Procurement Inclusive of Freight.
– Maxm % of Cut Pieces. Deduction @50% of Cost of Procurement Including Freight for Excess Cut Pieces.
– Day to Day Consumption of Chemicals, Cement be Checked with Theoretical Requirement.
![Page 41: Works Contract](https://reader035.fdocuments.net/reader035/viewer/2022062301/56813ff3550346895dab0df2/html5/thumbnails/41.jpg)
Tenders By More Than One Firms Under Same Management.
• Rly Bd’s Letter No.72/W-i/Ct/32 Dt.14.5.74– Restriction Can Not Be Imposed Legally.– Ensure That Undue Advantage Should Not Accrue,
Should They Alone Be In Field Of Competion.
![Page 42: Works Contract](https://reader035.fdocuments.net/reader035/viewer/2022062301/56813ff3550346895dab0df2/html5/thumbnails/42.jpg)
Negotiation In Works Tender.
– Rly Bd’s Engg. Standing Order No.9 Issued Vide Letter No.99/Ce I/Ct/1 Dt.15.1.99.
• Post Tender Negotiations Permitted Only With L1 I.E. Lowest Tenderer.
![Page 43: Works Contract](https://reader035.fdocuments.net/reader035/viewer/2022062301/56813ff3550346895dab0df2/html5/thumbnails/43.jpg)
Zonal Contracts.
• Rly Bd’s Letter No.63/W-ii/Ct/28 Dt.5.3.66.– Period 1st July To 30th June– No WOs Be Issued As Far As Possible After Opening
Of New Tenders.– Works Of Old Contracts Be Completed By End Of
June.– Exceptional Cases Be Dealt With On Their Merits Incl.
Trend In Rates.
![Page 44: Works Contract](https://reader035.fdocuments.net/reader035/viewer/2022062301/56813ff3550346895dab0df2/html5/thumbnails/44.jpg)
Approved List Of Contactors.
• Rly Bd’s Letter No.88/Ce-i/Ct/74 Dt.17.9.97.– Annual Updating Giving Wide Publicity Through
Advertisements Inviting Contractors To Register.– Validity Of Registration For 3 Years Unless. Annual
Fee Of Rs.1000/- Not Paid Or Decision To Delist Is Communicated. After 3 Years, Contractor Has To Apply Again.
– During The Year Addn. /Deletion/Down Grading Can Be Done.
![Page 45: Works Contract](https://reader035.fdocuments.net/reader035/viewer/2022062301/56813ff3550346895dab0df2/html5/thumbnails/45.jpg)
Approved List Of Contractors
• Slabs– Class A > Rs.50 Lakhs– Class B < Rs.50 Lakhs– Class C < Rs.20 Lakhs– Class D < Rs.05 Lakhs– Class E < Rs.01 Lakhs
• Criterias For Selection As Per Rly Bd’s Letter No.85/W1/Ct/23 Gcc Dt.16.8.89.
• Rly Bd’s Letter No.85/W-i/Ct/23/Gcc(part I) Dt.25.8.89 For Selection Committee For Appd. List Of Contractors.
![Page 46: Works Contract](https://reader035.fdocuments.net/reader035/viewer/2022062301/56813ff3550346895dab0df2/html5/thumbnails/46.jpg)
Class A:
– Engg. Orgn, Graduate Engr With 10 Yrs Experience Plus An Engg. Diploma Holder Having 5 Yrs. Of Experience.
– Min Transport Eqauipments.– Construction T & P– Satisfactiory Execution Of At Least 2 Works,
Each < 25 Lakhs.
![Page 47: Works Contract](https://reader035.fdocuments.net/reader035/viewer/2022062301/56813ff3550346895dab0df2/html5/thumbnails/47.jpg)
Class B:
– Engg. Orgn, Graduate Engr With 5 Yrs Experience
– Min Tansport Equipments– Construction T & P– Satisfactory Execution Of At Least 2 Works,
Each < Rs.10 Lakhs
![Page 48: Works Contract](https://reader035.fdocuments.net/reader035/viewer/2022062301/56813ff3550346895dab0df2/html5/thumbnails/48.jpg)
Class C:
– Engg. Orgn, An Engg Diploma Holder Having At Least 3 Yrs Experience.
– Satisfactory Execution Of At Least 2 Works, Each < 3 Lakhs.
![Page 49: Works Contract](https://reader035.fdocuments.net/reader035/viewer/2022062301/56813ff3550346895dab0df2/html5/thumbnails/49.jpg)
Class D:
– No Specific Minimum Requirement.
• Selection Committee & Accepting Authority As Per Rly Bd’s Letter No.88/Ce-i/Ct/74 Dt.17.9.97.
• Confidential Reports As Per Specified Proforma.
![Page 50: Works Contract](https://reader035.fdocuments.net/reader035/viewer/2022062301/56813ff3550346895dab0df2/html5/thumbnails/50.jpg)
Two Packet System Of Tenders.
– With A View To Assess The Tenders Technically Without Being Influenced By The Bids.
– Quotations In Two Sealed Envelopes With One Cover Containing Technical And Commercial Conditions And Other Containing Financial Bids.
– Technical Details & Commercial Conditions Are Read Out And Evaluated By T.C.
![Page 51: Works Contract](https://reader035.fdocuments.net/reader035/viewer/2022062301/56813ff3550346895dab0df2/html5/thumbnails/51.jpg)
– If Technical Bids Found Acceptable By Competant Authority, The Second Packet Is Opened And Tenders Are Processed For Acceptance.
– Two Packet System Be Adopted For Exceptional Tender Cases Of High Value And High Complexity.
Two Packet System ( CONTD)
![Page 52: Works Contract](https://reader035.fdocuments.net/reader035/viewer/2022062301/56813ff3550346895dab0df2/html5/thumbnails/52.jpg)
It Can Be Adopted For :
– Important And Prestigious Buildings.– For Structures Such As Auditoriums, Multistoreyed
Bldgs.– For Big Rly Bridges On Important Rivers And
Important Robs.– For Works Involving Special Architectural Features.
![Page 53: Works Contract](https://reader035.fdocuments.net/reader035/viewer/2022062301/56813ff3550346895dab0df2/html5/thumbnails/53.jpg)
Price Variation
– Rly Bd’s Letter No.80/W - I/Ct/10 Dt.23.4.80, Dt.20.1.87, Dt.16.3.88.
– Rly Bd’s Letter No.85/W - I/Ct/7 Dt.17.7.90 And Dt.4.4.96.
• 5% Floor Price Variation• For Contracts Up To 1 Yr No Pv Clause• For Contracts Between 1 To 2 Yrs. Maxm. 10%
(I.E. 15% - 5%)• For Contracts > 2 Yrs Duration Maxm. 20% (I.E.
25% - 5%)
![Page 54: Works Contract](https://reader035.fdocuments.net/reader035/viewer/2022062301/56813ff3550346895dab0df2/html5/thumbnails/54.jpg)
Prequalification Of Tenderers(Rly. Bd.’S Letter No.
85/W1/Ct/23-gcc Dt. 31.1.86)
![Page 55: Works Contract](https://reader035.fdocuments.net/reader035/viewer/2022062301/56813ff3550346895dab0df2/html5/thumbnails/55.jpg)
Why Required
• Only Reliable And Resourceful Contractors To Be Chosen For Works
• A. Of Large Value & Magnitude• B. Requiring Special Expertise• C. Specialised Equipment Works Of
Complex Nature
![Page 56: Works Contract](https://reader035.fdocuments.net/reader035/viewer/2022062301/56813ff3550346895dab0df2/html5/thumbnails/56.jpg)
When Required
1. Earthwork
2. Tunnelling
3. Bridge Work
4. Building And Structural Works
5. Electrification Works
![Page 57: Works Contract](https://reader035.fdocuments.net/reader035/viewer/2022062301/56813ff3550346895dab0df2/html5/thumbnails/57.jpg)
Earthwork Involving
• Mechanical Compaction Where C.A.Value Would Exceed 50 Lacs
• Soil Stabilisation E.G Sand Piling, Vibre Floatation, Soil Chemical Treatment Irrespective Of C.A. Value
• Heavy And Deep Rockcutting Reqg. Deployment Of Heavy Plant & Machinery Or Expensive Blasting Operations Irrespective Of Contract Value
• Tunnelling Where C.A. Value Would Exceed Rs. 50 Lacs
![Page 58: Works Contract](https://reader035.fdocuments.net/reader035/viewer/2022062301/56813ff3550346895dab0df2/html5/thumbnails/58.jpg)
Bridgework Involving
• Pile Foundations Of Large Diameter• Deep Well Foundations• Long-spanned Psc Bridges• Cable Stayed Bridges• Continuous Girder Bridges• Fabrication And Launching Of Girder Spans>60m• Building Works• Pile Foundations
![Page 59: Works Contract](https://reader035.fdocuments.net/reader035/viewer/2022062301/56813ff3550346895dab0df2/html5/thumbnails/59.jpg)
Penalties For Specific Contractor
• Adverse CR Prevents Future Works Being Awarded Till Improvement
• In Extreme Cases, Banning Of Business Dealings By Rly. Board
![Page 60: Works Contract](https://reader035.fdocuments.net/reader035/viewer/2022062301/56813ff3550346895dab0df2/html5/thumbnails/60.jpg)
Incentives In Contracts
• Additional Fixed Amt. Per Day In Advance Of Completion Period
• Bonus Percentage Payment On Contract Value
• Points System For Future Tender Consideration