Give the meaning and situations where following payments are made to contractor.

First and final payment

Advance payment

Ans.

First and final payment

The term indicates a single payment, made for a job or contract on its completion. In this case the payments is finished by one payment after the completion of the work. This is usually application for small work.

Advance payment

This means payment made on a running account to a contractor for work done by him but not measured. Advance payment is not generally made to the contractor but may be made under special cases, when the work is sufficiently progressed but measurement cannot be taken for certain valid reasons, on the work done, is in no case less than the advance payment made or proposed to be made and detailed measurement will be taken as soon as possible.

Give the meaning of lumpsum contract and state four advantages and four disadvantages of it.

Ans.

Lumpsump contract

In lumpsump contract, the contractor undertakes the execution of construction of a specific work and shown in the drawings and described by specifications. The contractor will complete the work within the stipulated time for a fixed amount. There are no individual rates quoated, thus it becomes difficult to make adjustments in the contract value of any changes one makes in work out later stage.

In lumpsum contract, generally the lumpsum value is paid to the contractor on the completion of the work. On completion of the work no detailed measurement of different items of the work is required but the whole work is compared and checked with plans and drawings.

Advantages

From the tender of the work, the owner can visualise the approximate cost of the work.

The owner need not require to keep staff for keeping any account.

Only an engineer, on behalf of the owner to required to see that the work is being carried out as per drawing and specifications.

The contractor can gain more benefits by excellent planning and by effective management on the site of the work.

Disadvantages

All the details of the work are not specified in the content document.

In case of additional work is to be done on the job, the contractor claims more rates for the items not included in the agreement.

Before the contract is set out, the project has to be studies thoroughly and is prepare all the content documents in every respect. This is a time consuming work and is costly.

Give the meaning and purpose of the following

Administrative approval

Technical sanction

Ans.

Administrative approval

For any work or project required by a department, an approval or sanction of the competent authority of the department, with respect to the cost and the work is necessary at the first instance. The approval authorises the engineering department to take up the work. Administrative approval denotes the formal acceptance by the department concerned of the proposal, and after the administrative approval is given, the engineering department (pwd) takes up the work and prepares detailed designs, plans and estimates and then execute, the work. The engineering department prepares approximate estimates and preliminary plans and submits to the department concerned for administrative approval.

Technical sanction

Technical sanction means the sanction if the detailed estimate, design calculations quantities of works, rates and costs of the work by the competent authority of the engineering department. After the technical sanction of the estimate given, then only the work is taken up for construction. In case of original work, the counter signature of the local head of the department should be obtained in the plan and estimate before technical sanction is accorded by the engineering department, the power of the technical sanction, delegated to various govt. officials in the order shown below –

The chief engg. – full powers
The superintending engr. – san. Up to 15 lakhs
The executive engr. – san. Up to 3 lakhs.

Give the meaning of the following terms.

Labour contract

Security deposit

Defect liability period

Liquidated damage

Ans.

Labour contract

In labour contract, the contractor undertakes contract for labour portion only. All materials for the construction, are arranged and supplied at the site of the work by the department or owner, the labour contractor engages the labour and gets the work done according to the specifications.

Security deposit

On acceptance of the tender the contractor has to deposit 10% of the tendered amount as security deposit with the department which is inclusive of the earning money already deposited. This amount is kept as a check so the contract fulfils all the terms and conditions of the contract and carries out the work satisfactorily according to the specifications and maintenance the progress and completes in time. If the contractor fails to fulfil the terms of contract his whole or part of the security deposit is forfeled by the government. The security deposit is returned to contractor after the satisfactory completion of the whole work.

Defect liability period

 After completing the work or project by the contractor some period is fixed in the contract, to see for any defects in the work due to materials or workmanship not in accordance with content. This is know as defect liability period. Defect liability period is generally adopted as the period covering the first monsoon, usually specified as six months after the virtual completion. If mothing is mentioned about the same in the contract, then the defect liability period is taken as 12 months from the date of virtual completion.

Contractor’s liability, for the defects ceases on the issue of the final certificate. Improper works executed due to defective workmanship or materials are to be removed and re-executed at the contractor’s cost in time.

Liquidated damages

It is a fixed stipulated sum of penalty payable by the contractor having no relationship with the real damage. Is is normally exhorbitant and fixed per day, varying from Rs. 50 to Rs. 100 /- per day for the excess period taken for the completion of the work than that specified in the contract.

Give the list of documents included in the tender set.

Ans.

List of the documents in the tender set

Prescribed form of tender

Conditions of contract

Contract documents

Scheduled of quantities

Detailed drawings

Detailed specifications

Give the list of information given in the tender notice.

Ans.

List of information given in the tender notice

Mode of submitting tender

Name of the authorities inviting tenders

Nature of the work and its location

Estimated cost

Time limit for completion

The date, time and place of receipt and opening of tenders.

Availability of forms – place, time and cost of forms

Amount of Earnest Money

Amount of Security deposit

Reservation of right to reject bids

Validity of tender

Define tender and state only tender notice is given in the news papers.

Ans.

Tender

Tender is an offer inwritting to execute some specified works or to supply materials at certain rates, within a fixed time, under certain conditions of contract and agreement between the contractor and the department or owner. Sealed tenders are invited and the work is allotted to the lowest tenderer. While inviting tenders the bill or quantities, detailed specifications, conditions of contract and complete drawings are supplied on payment the contractors who wants to tender or quote their rates.

Wide publicity for a tender is given to secure the benefit of keen completion amongst a considerable number of firms/contractors and potential bidders for big and specialised job or design and manufacture, even globel tenders are sometimes invited by the authority to get competitive offers from various specialised firms or reputed manufacturers throughout the world. News papers, journals and leading magezines etc. are the best means of giving wide publicity.

What care you as contractor will take while submitting a tender.

Ans.

Precautions while submitting tenders

Nature of the job or work is studied in detail to assures executions of the job and availability of materials.

Schedule of rates one referred for estimating the cost of the work.

All the relevant details are filled, clearly written without overwriting or changing the figures.

All the documents, supplied with the tender are submitted before due time.
The amount or the rate column in the tender is filled in after assessing the competition involved in the tender.