TENDERING & CONTRACT MANAGEMENT Part - VI- MANDATORY DOCUMENTS

TENDERING & CONTRACT MANAGEMENT  Part - VI 

TENDERS – MANDATORY DOCUMENTS



COMPANY REGISTRATION CERTIFICATES

·        Proving Legal Existence

1. Certificate of Incorporation (For Companies)

Issued By: Registrar of Companies (RoC) What It Proves: Company legally exists Validity: Perpetual (no expiry)

What to Submit:

  • Full certificate (with CIN number visible)
  • If name changed: Certificate of name change also
  • Certified true copy acceptable

For Partnership Firms:

  • Partnership Deed (registered)
  • Certificate of Registration (if registered under Partnership Act)

For Proprietorships:

  • GST registration (serves as business proof)
  • Udyam Registration (MSME)
  • Shop & Establishment license

For LLPs:

  • LLP Incorporation Certificate from MCA

Common Mistakes: ❌ Submitting expired registration (old companies) ❌ Name mismatch (company name changed but cert not updated) ❌ Unclear scan (CIN not readable)

2. GST Registration Certificate

Full Form: Goods and Services Tax Identification Number (GSTIN) Issued By: GST Department, State/Central Format: 15-digit alphanumeric (e.g., 27AABCU9603R1ZX) Validity: Perpetual (but can be cancelled if non-compliant)

What to Check Before Submitting:

  • Status: ACTIVE (not suspended/cancelled)
  • Verify online: www.gst.gov.in → Search Taxpayer
  • Address matches with tender submission
  • All business places registered if multi-location

What to Submit:

  • GST Registration Certificate (download from portal)
  • Latest GST return proof (last 3 months recommended)

Common Mistakes: ❌ GST cancelled/suspended (check portal before bidding) ❌ Different state GST (some tenders require same state) ❌ Provisional GST (some tenders ask for final only)

3. PAN Card (Permanent Account Number)

Issued By: Income Tax Department Format: 10-character alphanumeric (e.g., AABCU9603R) Validity: Perpetual

What to Submit:

  • PAN card of company/firm/proprietor
  • Must match with GST registration PAN
  • Clear, legible copy

Why It Matters:

  • TDS deduction from payments
  • Cross-verification with GST
  • Financial credibility check

Common Mistakes: ❌ Individual partner's PAN instead of firm's PAN ❌ Mismatch between PAN in GST and PAN submitted

4. TAN (Tax Deduction Account Number)

Full Form: Tax Deduction and Collection Account Number Issued By: Income Tax Department Format: 10-character alphanumeric (e.g., DELC12345F) Purpose: For TDS return filing

When Required:

  • All companies/firms deducting TDS must have TAN
  • Mandatory if you have employees (TDS on salary)
  • Some tenders specifically ask for TAN

What to Submit:

  • TAN allotment letter
  • Or download from TRACES portal

Note: Not all small contractors have TAN (if no TDS obligation) If tender mandates, you MUST obtain before bidding

STATUTORY REGISTRATIONS

·        Labour Law Compliance

5. EPF Registration (Employees' Provident Fund)

Full Form: EPFO (Employees' Provident Fund Organization) Mandatory For: All establishments with 20+ employees Registration Number: State code + Office code + Establishment code Example: TN/12345/0001234

What to Submit:

  • EPF Registration Certificate (Form 5A or similar)
  • Latest EPF challan (last 3-6 months)
  • ECR (Electronic Challan cum Return) screenshot

What Client Checks:

  • You're compliant with labour laws
  • Employees' welfare being taken care of
  • No dues pending

If You Don't Have 20 Employees:

  • Voluntary registration possible
  • Some tenders accept "Not Applicable" declaration
  • But for government tenders > ₹10 Cr, usually mandatory

Common Mistakes: ❌ Submitting old/cancelled registration ❌ Pending dues (verify online before bidding) ❌ ECR not filed for last 3 months (shows non-compliance)

6. ESI Registration (Employees' State Insurance)

Full Form: ESIC (Employees' State Insurance Corporation) Mandatory For: Establishments with 10+ employees earning < ₹21,000/month Registration Number: 17-digit code Example: 11-12-012345-000-0001

What to Submit:

  • ESI Registration Certificate
  • Latest ESI challan (last 3-6 months)
  • Return filed proof

 

Benefits Covered:

  • Medical facilities for workers
  • Sickness, maternity, disability benefits

What Client Checks:

  • Worker welfare
  • Compliance with ESIC Act

If Not Applicable:

  • Submit declaration: "We have no employees in ESI wage limit" OR "We have <10 employees"

Common Mistakes: ❌ Not updating employee count (had <10, now have 15, but not registered) ❌ Pending dues

How to Verify Your Compliance:

  • EPF Portal: unifiedportal-mem.epfindia.gov.in
  • ESI Portal: www.esic.in
  • Check status, dues, last payment date

EXPERIENCE CERTIFICATES

·        Proving Your Track Record

What Are Experience Certificates? Documentary proof that you've successfully completed similar projects in the past.

Why Critical:

  • Pre-qualification criteria (minimum ₹X value work in last Y years)
  • Technical capability assessment
  • Client reference check
  • 30-40% weight in evaluation (in some tenders)

Qualifying Criteria (Typical - varies by tender):

  • Nature of work: "Similar work" (defined in tender)
  • Value: Minimum ₹X Cr work
  • Period: Last 5-7 years
  • Status: Completed (ongoing doesn't count usually)
  • Client type: Sometimes requires government client experience

What Constitutes Valid Experience Certificate:

Essential Elements:

  1. Client letterhead: Official, with logo
  2. Work description: Clear scope (e.g., "Construction of G+4 RCC building")
  3. Contract value: Actual value executed (not just awarded)
  4. Period: Start and completion dates
  5. Completion status: "Satisfactorily completed" statement
  6. Client signature: Authorized signatory with designation
  7. Client seal/stamp: Official
  8. Contact details: For verification

____________________________________________________________________________________________

Format Suggestion:

[Client Letterhead]

 

WORK COMPLETION CERTIFICATE

 

This is to certify that M/s [Your Company Name] has successfully executed the following work awarded by us:

 

Name of Work: Construction of Administrative Block

Location: Sector 15, Noida

Contract Value: ₹15,45,00,000/- (Rupees Fifteen Crores Forty Five Lakhs only)

Work Order No: CE/2022/123 dated 15-Jan-2022

Date of Commencement: 01-Feb-2022

Date of Completion: 30-Nov-2023

Actual Amount Paid: ₹15,38,50,000/-

 

The work has been completed SATISFACTORILY and to our entire satisfaction as per contract terms and specifications.

 

[Signature]

Name: Shri XYZ

Designation: Executive Engineer

Organization: CPWD

Date: 05-Dec-2023

Contact: +91-11-12345678

Email: ee.xyz@cpwd.gov.in

[Official Seal]

How Many Certificates to Submit?

Depends on PQ Criteria:

Example Requirement: "Bidder should have completed minimum ONE similar work of value ₹12 Cr OR TWO works of ₹8 Cr each in last 5 years"

Your Strategy:

  • If you have 1 work of ₹15 Cr → Submit that (exceeds requirement)
  • If you have 2 works of ₹9 Cr each → Submit both (satisfies 2nd condition)
  • Submit 1-2 extra as backup (in case client disputes similarity)

**What is "Similar Work"?**

 Tender defines this. Common definitions:

  • "Building construction work" - Any building qualifies
  • "RCC building construction" - Must have RCC structure
  • "Multi-story building" - Must be G+3 or more
  • "Institutional building" - Hospitals, schools, offices
  • Read carefully and match your experience

Supporting Documents: Along with completion certificate, attach:

  • Work order copy (proves award)
  • Final bill / payment certificate (proves value)
  • Photographs (proves execution)

Client Verification: Evaluators WILL call the client mentioned in certificate

  • Ensure contact number is current
  • Inform your ex-client that verification call may come
  • If client doesn't respond or gives negative feedback → Rejected

SLIDE 33: FINANCIAL STATEMENTS

Title: Proving Financial Health

Why Financial Statements? Client wants to ensure:

  • You have financial capacity to execute
  • You won't go bankrupt mid-project
  • You can arrange working capital
  • Your business is stable

What to Submit:

1. Audited Balance Sheet (Last 3 Years)

  • For companies: As per Companies Act (audited by CA)
  • For firms/proprietors: IT audited statements (if turnover > ₹1 Cr)

Must Show:

  • Assets and Liabilities
  • Auditor's signature and seal
  • Financial year clearly mentioned

2. Profit & Loss Statement (Last 3 Years)

  • Revenue and expenses
  • Net profit/loss
  • Turnover figures

3. Income Tax Returns (ITR - Last 3 Years)

  • ITR acknowledgment (filed with IT Department)
  • Computation of income
  • Proves tax compliance

4. Auditor's Certificate Some tenders ask for CA certificate stating:

  • Annual turnover for last 3 years
  • Net worth
  • Working capital
  • No bankruptcy proceedings

Financial Qualifying Criteria (Typical):

Minimum Turnover: "Average annual turnover in last 3 years should be at least 2X of estimated contract value"

Example:

  • Estimated contract: ₹10 Cr
  • Requirement: ₹20 Cr average turnover
  • Your turnover: FY 21-22: ₹18 Cr, FY 22-23: ₹22 Cr, FY 23-24: ₹21 Cr
  • Average: (18+22+21)/3 = ₹20.33 Cr → QUALIFIES

Positive Net Worth: "Should have positive net worth in all 3 years" Net worth = Total Assets - Total Liabilities

Working Capital: "Should have access to working capital of at least 10% of contract value"

How to Calculate Working Capital: Current Assets - Current Liabilities OR Bank solvency certificate stating available credit limit

Common Mistakes:

❌ Unaudited statements: Self-prepared or CA compiled (not audited) → Rejected

❌ Wrong financial year: Tender released in Jan 2026, asks for "last 3 FY" You submit: FY 23-24, 22-23, 21-22 (✓ Correct) NOT: FY 24-25 (not yet audited in Jan 2026)

❌ Incomplete statements: Only balance sheet, no P&L or vice versa

❌ Mismatch with ITR: Balance sheet shows ₹25 Cr turnover, ITR shows ₹20 Cr → Red flag

❌ Different entity: You're bidding as ABC Constructions Pvt Ltd But submit financials of ABC Infra Pvt Ltd (sister concern) → Rejected

For Consortium/JV:

  • Submit financials of ALL partners
  • Combined turnover/net worth considered
  • Joint Venture agreement must specify financial contribution

EARNEST MONEY DEPOSIT (EMD)

·        Your Bid Security

What is EMD? Money deposited along with bid to ensure:

  • You're a serious bidder
  • You won't withdraw bid after submission
  • Compensation to client if you back out

EMD Amount:

  • Typically: 1-2% of estimated contract value
  • Example: ₹10 Cr contract → ₹10-20 lakhs EMD

Acceptable Forms (As Per Tender):

1. Demand Draft (DD)

  • Drawn on scheduled bank
  • In favor of: [Client name as specified]
  • Payable at: [Location specified]
  • Valid for: Minimum bid validity period + 30 days

2. Banker's Cheque

  • Similar to DD
  • From scheduled bank

3. Fixed Deposit Receipt (FDR)

  • Pledged in favor of client
  • With lien marked

4. Bank Guarantee

  • From scheduled bank
  • Irrevocable and unconditional
  • Validity: Bid validity + 30 days
  • Format: As specified in tender or bank's standard format

5. Online Payment (e-Payment)

  • Through e-procurement portal
  • Payment gateway transaction
  • Confirmation receipt to be attached in bid

6. EMD Exemption (If Applicable):

  • MSME registered: 100% exemption (submit Udyam certificate)
  • Startups: As per government policy
  • Some categories: Women entrepreneurs, SC/ST
  • Exemption certificate to be submitted

Critical EMD Requirements:

Amount:

  • Must be EXACTLY as specified (not less, not more)
  • If ₹10,50,000 required → DD of ₹10,50,000 ONLY
  • ₹10,00,000 → REJECTED (insufficient)

Validity:

  • Must be valid on bid opening date
  • Should remain valid till bid validity + 30 days
  • Expired DD/BG → REJECTED

Favoring:

  • Exactly as specified in tender
  • "Pay to: Executive Engineer, CPWD, Delhi"
  • Even 1 word different → May be rejected

If Bank Guarantee:

  • On bank letterhead with seal
  • Signed by authorized signatory (with specimen signature)
  • Claim period: Client can invoke within validity
  • Unconditional: "We shall pay without demur"

EMD Submission:

For Physical Bids:

  • Original DD/BG in separate envelope marked "EMD"
  • Do NOT staple to other documents (can be returned)

For Online Bids:

  • Scan and upload DD/BG
  • OR pay online through portal
  • Original to be submitted if shortlisted (some portals)

When is EMD Returned?

Successful Bidder:

  • After submitting Performance Bank Guarantee
  • Typically within 30 days of LOA acceptance

Unsuccessful Bidders:

  • After contract award to L1
  • Typically 60-90 days post bid opening

When is EMD Forfeited?

❌ Withdrawal of bid during validity period ❌ Refusing to accept LOA after being declared L1 ❌ Failure to submit Performance BG after LOA ❌ Submitting false/fraudulent documents ❌ Any breach of bid conditions

EMD Forfeiture = Permanent loss + Possible blacklisting

PERFORMANCE BANK GUARANTEE (PBG)

·        Contract Security

What is Performance Bank Guarantee? A bank guarantee submitted by successful bidder (L1) to secure contract performance.

Purpose:

  • Ensures you complete work as per contract
  • Client's security against contractor default
  • Can be invoked if you breach contract

When to Submit:

  • After receiving Letter of Award (LOA)
  • Before signing contract agreement
  • Timeline: Typically 10-15 days from LOA

Amount:

  • 5-10% of contract value (as specified in tender)
  • Example: ₹10 Cr contract → ₹50 lakhs to ₹1 Cr PBG

Validity:

  • Contract period + Defect Liability Period + 60 days
  • Example: 18 months contract + 12 months DLP + 60 days = 32 months

Performance Bank Guarantee Format:

Essential Clauses:

[Bank Letterhead]

 

PERFORMANCE BANK GUARANTEE

 

Guarantee No: PBG/2026/12345

Date: [Date]

 

To,

[Client Name and Address]

 

Dear Sirs,

 

In consideration of you, [Client Name] having agreed to accept Performance Bank Guarantee from [Bank Name] for Rs. [Amount in figures and words] as security deposit for due performance and fulfillment of the contract by M/s [Contractor Name] (hereinafter called 'the Contractor') for [Work Name] under Agreement No. [Agreement No.] dated [Date], we [Bank Name] hereby undertake to pay you on demand any sum or sums not exceeding Rs. [Amount] (Rupees [Amount in words] only) without any demur and without your having to substantiate your demand.

 

This guarantee shall remain valid until [Validity Date].

 

We, [Bank Name], further agree that you shall be the sole judge to decide as to whether the Contractor has committed any breach of the agreement, and your decision that the Contractor has committed such breach shall be final and binding on us.

 

This Guarantee will not be discharged due to the change in the constitution of the Bank or the Contractor.

 

Notwithstanding anything contained herein:

 

1. Our liability under this Bank Guarantee shall not exceed Rs. [Amount].

 

2. This Bank Guarantee shall be valid up to [Validity Date].

 

3. We are liable to pay the guaranteed amount or any part thereof under this Bank Guarantee only if you serve upon us a written claim or demand on or before [Validity Date].

 

Dated this [Day] day of [Month], [Year].

 

For [Bank Name]

 

[Signature]

[Name]

[Designation]

[Branch Address]

[Contact Details]

 

[Bank Seal]

Key Points:

Unconditional and Irrevocable:

  • Bank pays on client's demand, no questions asked
  • Contractor cannot stop payment
  • No need for client to prove breach

From Scheduled Bank:

  • Public sector banks (SBI, PNB, etc.)
  • Nationalized banks
  • Private banks with good standing
  • Cooperative banks usually NOT accepted

On Bank Letterhead:

  • Original, not photocopy
  • Bank seal mandatory
  • Authorized signatory (manager level)
  • Signature must match bank records

Claim Period:

  • Client can invoke anytime within validity
  • Usually 60 days after expiry for final claims

 

When Can Client Invoke PBG?

Legitimate Reasons:

  • You abandon work midway
  • Persistent poor quality despite warnings
  • Delay beyond acceptable limits
  • Breach of contract terms
  • Insolvency

Process:

  1. Client issues notice to contractor (usually)
  2. If no resolution, client writes to bank
  3. Bank pays client within 3-7 days
  4. Bank recovers from contractor (your liability)

Your Protection:

  • Perform contract honestly
  • Maintain documentation
  • Comply with all terms
  • If dispute, resolve before client invokes

Reduction of PBG:

Progressive Reduction: Some contracts allow reduction based on progress:

  • After 50% work: Reduce to 50% of original
  • After 75% work: Reduce to 25% of original

Final Release:

  • After completion + Defect Liability Period
  • Submission of final bill
  • No dues certificate from client
  • Typically 24-30 months after LOA

Format for Release Request:

To,

[Client]

 

Subject: Release of Performance Bank Guarantee

 

Dear Sir,

 

We have successfully completed the work of [Work Name] under Agreement No. [X] dated [Date]. The Defect Liability Period of 12 months has also expired on [Date].

 

We request you to kindly release our Performance Bank Guarantee No. PBG/2026/12345 for Rs. [Amount] lodged with you.

 

[Attachments: Completion certificate, Final bill acknowledgment]

 

Thanking you,

[Contractor signature]

DOCUMENT SUBMISSION CHECKLIST

·        Zero-Error Approach

Master Checklist (Customize Per Tender):

A. Company Documents ☐ Certificate of Incorporation / Partnership Deed (certified copy) ☐ Memorandum and Articles of Association (for companies) ☐ Board resolution authorizing signatory to sign bid ☐ Power of Attorney (if someone other than director signing)

B. Tax Registrations ☐ GST Registration Certificate (current, active status verified) ☐ PAN Card (matches GST PAN) ☐ TAN Certificate (if applicable)

C. Statutory Compliance ☐ EPF Registration + Latest 6 months challans ☐ ESI Registration + Latest 6 months challans ☐ Labour License (if tender asks) ☐ Professional Tax registration (state-specific)

D. Experience Certificates ☐ Work Completion Certificates (minimum required number) ☐ Work Orders for each completion certificate ☐ Payment certificates proving value ☐ Photographs of completed projects

E. Financial Documents ☐ Audited Balance Sheets (last 3 years) ☐ Profit & Loss Statements (last 3 years) ☐ Income Tax Returns (last 3 years) ☐ CA Certificate for turnover, net worth (if required) ☐ Bank Solvency Certificate (if required)

F. Technical Documents ☐ Method Statements (all major activities) ☐ Project Execution Plan with Bar chart ☐ Quality Assurance Plan ☐ Safety Plan ☐ Environmental Management Plan ☐ Equipment list with ownership proof ☐ Key personnel resumes

G. Bid Security ☐ EMD: DD/BG/Online payment proof (correct amount, validity, favoring) ☐ OR MSME exemption certificate

H. Formats and Forms (As Per Tender) ☐ Bid form (filled, signed) ☐ Compliance statement (all clauses accepted/deviated) ☐ Integrity Pact (signed, if required) ☐ Non-blacklisting affidavit ☐ Joint Venture agreement (if JV bid)

I. Other Documents (Tender-Specific) ☐ ISO certification (if required) ☐ Prequalification documents (if two-stage bid) ☐ Locality certificate (if local preference) ☐ Caste certificate (if SC/ST reservation)

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