Module 6 Cepm
Module 6 Cepm
CONTRACT
An agreement enforceable by law is called contract. The contract in-variably follows a proposal
from one party and its acceptance by the other. As per P.W.D., contract is an agreement or an
undertaking by a person or firm to do some work under certain terms and conditions. The work
may be for the construction or maintenance and repairs, for the supply of materials, for the supply
of labours, for transport of materials etc.
Following are the main essential requirements of a valid contract so that it may be legally binding
on both the parties,
As per Indian Contract Act, the parties entering into contract should be legally competent. In
general, anyone can make the contract provided he is of majority and is of sound mind. Signing
officers should be in power to sign the contract i.e. no contracts shall be made by a subordinate
authority has not been directed or authorized to do so.
In other words, it is also called a genuine agreement or mutual assent between the two parties. It
means concurring of two minds in respect of the same opinion, purpose or understanding as regards
the course to be pursued. The consent of contracting parties must be real and genuine. Contract is
said to be free when;
• It is not caused under influence. The relation between two-parties is not such that one of
the parties is in a position to dominate the will of the others and uses the position to obtain
an unfair advantage over the other.
• It is not caused by MISTAKE where the parties have not meant the thing or though meaning
the same thing, have formed untrue conclusions as to the subject matter, it is called
MISTAKE. A mistake may be of expression, intention or omission.
• It is not caused by MISREPRESENTATION. If one of the parties has been led to form
untrue conclusions as regards the subject matter by a statement innocently made or
innocently withheld by the other, it is called MISREPRESENTATION.
• It is not caused by FRAUD. Fraud is false representation of material facts intentionally.
• It is not caused under DURESS. To constitute duress there must be some actual or
threatened exercise of power possessed by the party exacting or receiving the payments.
• When the proposed contract violates some law of the state or Indian union.
• When it is contrary to the rules of common law.
• When it is forbidden by the public policy
The valid consideration in the legal sense can be defined as the act or a promise to do something
by a party in return of money or promise or grant of some interests by the other party. In all
engineering contracts, the contractors get money from the parties for whom the work is done.
Impossible promises or acts are not entertained by the courts because there is no valid
consideration.
Meaning of the agreement should be certain or capable of being made certain and according to law
the contract documents must be signed by the authorized persons of both the parties. In case of
public bodies, an official duly authorized for this purpose signs the contract fixing the seal of the
public body on the agreement.
EARNEST MONEY
Earnest money is an assurance or guarantee on the part of the contractor to keep open the offer for
consideration and to confirm his intention to take up the work if accepted in his favour for
execution as per terms and conditions in the tender. While submitting a tender, the contractor is to
deposit a certain amount usually 1% to 2% of the total estimated cost of the work, with the
department, as earnest money. The main objects of collecting forms are;
The main objects of collecting the earnest money with the tender forms are ;
i) Compensation: In case, the contractor refuses to take up the work or runs away when his tender
is accepted, the work can be allotted to the next lowest bidder. The earnest money forfeited
compensates the loss of owner/department to a great extent.
ii) Punishment: In case the contractor quotes lower rate without intention of doing the work, the
earnest money shall be forfeited as a punishment.
iii) Restriction on unnecessary competition: The provision of earnest money will restrict the entry
of many contractors who may not have enough resources to do the work.
Earnest money given by all contractors except the three lowest tenderers is returned within a week
from the date of receipt of tenders. Earnest money of the second and third lowest is returned within
15 days of the acceptance of the tender, if their offers are not considered. The earnest money of
the lowest tenderer whose tender has been accepted is normally retained by the department as a
part of the security deposit of the contract.
TENDER
Tender is an offer in writing to execute some specified work at certain rates, within a fixed time
under certain conditions of contract and agreement between the contractor and the owner/party.
TENDER FORM
Tender form is a printed standard form giving the bill of. quantities, contractor's rates, and cost of
work, estimated money, security deposit, and time allowed for the work, columns for signature of
contractor, signature of witness to contractor's signature and signature of the officer.
TENDER-DOCUMENTS
The following items constitute a tender document which is signed by a contractor page by page,
necessary entries are made and a forwarding letter on letter head of a contractor with bank draft
for the earnest money. These are put in closed cover, duly sealed and dropped in the tender box
within the time limit for the submission of a tender. The name of work and name of the contractor
are subscribed on the cover;
TENDER NOTICE
Tender notice is issued in the prescribed form for calling tenders for execution of some works. The
following information are furnished in the tender notice;
Tender notice is advertised in all the leading newspapers and also pasted on the notice boards of
the department inviting tenders.
Global Tender
For very large and highly specialised jobs, the authority concerned invites tenders globally to get
competitive offers from various specialised or reputed agencies throughout the world. The contents
and particulars of global tender are same as that of any ordinary tender notice. Only the global
tender notice is written under the heading of N.I.T. It is circulated to reputed newspapers which
cover the outside countries as well as embassy offices located in important countries throughout
the globe.
Informal Tender
Unbalanced Tender
Particularly for Item rate contract, if a contractor, on the basis of shrewd anticipation or from
outside information, may quote high rate for item of works which are likely to be increased and
low rate for those items of works which are likely to be decreased, it is called unbalanced tender.
Comparative statement
Award of contract
TYPES OF CONTRACT
The followings are the various types of contracts for execution of Civil Engineering works, with
their relative merits and demerits;
• Item rate contract is also known as Unit Price contract or Schedule contract.
• A contractor undertakes the execution of work on an item rate basis
• The amount to be received by the contractor depends upon the quantities of work actually
performed.
• The payment to the contractor is made on the basis of the detailed measurements of
different items of work actually executed by him
• It is most suitable for all types of engineering works financed by public or government
bodies.
Merits
• This method ensures a very detailed analysis of cost and payment to the contractor
and also is based upon detailed measurements of each item actually done, so this
method is more scientific.
• Changes in drawings and quantities of individual item can be made as per
requirements within agreed limits.
• There is no urgency of providing detailed drawings at the time of awarding the
contract. It can be prepared later on.
Demerits
• In this form of contract, the department draws up `item rate tender' i.e., Bill of quantities
with-rate, amount and total amount.
• The contractors are required to offer to carry out the work as per with the rates shown in
the specific price schedule or some percentage above or some percentage below the rates
indicated in the schedule of work attached with the tender.
Merits
• The ranking amongst the contractors is easily known just on the opening of the tenders.
• As there is no provision to quote contractor's own rate for an individual item, benefit
due to increased quantity with a beneficial rate cannot be availed by the contractor. The
chance of unbalanced tender gets eliminated.
Demerits
• A contractor is required to write down only the percentage above or below, it is very
easy to write such a rate in few minutes before the time of submission of tender
• By negotiating among the contractors, two or more may quote the same rate in order to
get a part of the work at a high rate. There may be difficult to divide the work at equal
amount among the contractors.
Lump-sum contract
• In this type of contract, a contractor is required to quote a fixed sum for execution
of work complete in all respect in the stipulated time according to the drawing,
design and specifications supplied to him with the tender.
• The departmental schedule of rates for various items of work is also provided which
regulates the payment of the contractor in respect of any additions and alterations
which are made over the original work.
• On the completion of the work, no detailed measurement of different items of work
is needed but the whole work done must he compared and checked with the
drawings and specifications.
Merits
• As the total cost of the work known before hand, the owner can arrange the fund in
time.
• Detailed measurements of the work done are not required except in respect of
additions and alterations.
• The contractor's profit mainly lies in the completion time. Hence for getting more
profit the contractor tries to complete the work as early as possible. This concept
on the part of contractor coincides with the objective of the owner also.
Demerits
• For any intermediate payment, the value of work done should not be less than the
payment being made.
• It is suitable form of contract where considerable amount of additions and
alterations are expected.
Labour contract
• In labour contract, the contractor undertakes contract for the labour portion only
excluding the materials which are arranged and supplied at the work site by the
department/owner.
• The contractor engages the requisite labour and gets the work done as per
drawings and specifications.
• It is an item rate basis for labour portion only and the contractor is paid for the
quantities of work done on measurement of different items of work at the
stipulated rate in the contract agreement.
Merits
• The materials stored by the department are thus utilized.
• The work done through labour contract is of superior quality as better quality
materials are arranged by the owner.
• The overall cost of construction may be less, as no profit is paid on the cost of
materials.
• This system is very convenient for private building construction.
Demerits
• The owner and the department will have to remain vigilant and watchful over
the materials used, the contractor may overlook the material wastage involved.
• A large storage area is required to store the various kinds of materials to be used
in the construction under a constant guarding.
• This system is not suitable for government department. Because of lengthy
formalities in procurement of materials, it is very difficult to supply each and
every material readily to the labour contractor.
Material supply contract
In this type of contract, a contractor has to offer his rates for supply of the required
quantities of materials, inclusive of all local taxes, carriage and delivery charges to the
specified stores within the time limit prescribed in the tender. All such materials
received should be examined and counted or measured, as the case may be, when
delivery is taken.
Merits
• Payment is very prompt, so the contractors try to take supply order at less profit,
resulting in low cost of material.
• The owner/department has nothing to worry for any loss, breakage, demurrage,
charges during transit.
Demerits
In this type of contract, a contractor agrees to take the work of construction on the
actual cost of work plus on agreed percentage in addition, his services. It is generally
adopted when the labour and material cost are liable to fluctuate heavily in the market.
Merits
• The contract can be quickly drawn up and agreed and work can be completed
in the shortest possible time. It is well suited during war period or calamity-
period when the shortest possible project time is the main criteria in place of
the cost involved.
• It is particularly suitable when work cannot be executed by other types of
contracts due to uncertainty and fluctuations in the market rates of labour and
materials.
Demerits
• The contractor's only aim is to make the cost of the project as high as possible
in order to seek greater margin of profit.
• A proper control over purchase of materials and of labour shall have to be
exercised by the department or the owner.
In this type of contract, the contractor is paid by the owner an agreed fixed lump-sum
amount over and above actual cost of the work. This fixed fee will include overhead
and profit to the contractor. The fee does not vary with the actual cost of the work as
in the case of cost plus percentage rate contract.
Merits
• Since the fixed fee covers the contractor's overhead charges and profit, the
contractor will try to finish the work as early as possible, so the owner gets the
advantage of early completion.
Demerits
Target contract
In this system, the contractor is paid on a cost plus percentage basis of work and in
addition he receives a percentage plus or minus on savings or exceses effected against
a prior agreed estimate by measuring the work on completion and valuing at prior
agreed rates.
Merits:
• The contractor is encouraged to use his skill and expertise in order to keep the
cost of construction as low as possible. This gives an opportunity to a
contractor to earn bonus in addition to the fixed percentage fee.
Demerits:
• The contractor may try to increase the cost of construction high be-cause he
gains more amount on the basis of fixed percentage of cost of construction
without caring about the penalty on account of excess expenditure.
In this type of contract, the contractor gets the actual cost of construction plus an
amount of fee (% of construction cost) inversely variable according to the increase or
decrease of the estimated cost agreed first by both the parties. Higher the actual cost,
lower will be the percentage rate of fee and vice-versa. Here the main objectives of
both parties lie in the minimum cost of construction and this is treated as one of the
best systems of contract.
Merits:
• The owner and the contractor both will be benefited in the lowest possible cost
of construction and this is treated the best system of contract.
Demerits:
• The estimated cost must be accurately determined. In case the estimated cost
is much higher than the required one due to inefficiency of the estimator, a
contractor will get more amounts on the basis of savings
Negotiated contract
When the contract is awarded without calling tenders on the basis of negotiations only,
it is called negotiated contract. It may be of any form discussed above.
CONDITIONS OF CONTRACT
Both parties of a construction team should be fully acquainted with their rights and
duties. So while preparing the contract agreement, certain clauses related to the work
are laid down and these will be binding on both parties. The main purpose of the
conditions of contract is to avoid dispute and keep the parties as far as possible out of
court of law. Therefore it is imperative that all clauses of conditions of contract must
be precise and definite and there shouldn't be any room for ambiguity or
misconstruction therein.
Clause 1 Security deposit: The contractor shall deposit 10% of the estimated cost as
security money but this amount will be collected gradually from each running ac-count
of bill at the rate of 10% of the running bill. The amount will include the earnest money
already deposited while submitting the tender.
Clause 2 Compensation for delay: The time allowed for undertaking the work shall
be started from the 15th day after the date of giving work order or any other date as
specified in the tender. If there is delay in the completion of the work or if the monthly
progress is not proportionate to the time which has elapsed, the contractor is liable to
pay compensation to the department/owner. The amount of compensation may be
stated as a percentage of the estimated cost of work for each unit of time delay subject
to maximum of 10% of the contract price.
Clause 3. Action when the security deposit is forfeited: When the contractor has
made himself liable to pay compensation amounting to the whole of his security
deposit (due to taking action of clause 2) the Engineer-in-charge shall have the power
to adopt any of the prescribed courses as he may think fit for the purpose.
If the authority has no scope to exercise the powers invested as per clause 3, he may
take possession (after serving a written notice to the con-tractor) of all or any tools,
plants, materials and stores in or upon works and sell them by auction on account of
the contractor.
Clause 7. Payment on certificate: The final payment to the contractor shall be made
on the issue of completion certificate. And all intermediate payments shall be regarded
as advance against the final payment.
Clause 9A. Payment to certified bill to banks: Payment to the certified bill of the
contractor shall be made to his bank account instead of direct payment to him.
Clause 10A. Materials and stores supplied by the department: The value of the full
quantity of materials and stores supplied by the department to the contractor may be
deducted from sums then due at the fixed issue rate. Any excess quantity of materials,
and tools and plants (if any) must be returned in perfectly good condition. The
department shall not be responsible for any damage or loss or wastage to any such
materials.
Clause 10B. Secured advance: The contractor shall be entitled to get 75% advance
payment against the estimated value of any materials which have been brought on the
site in connection with the work.
Clause 11. Drawings and specifications: All works shall be carried out faithfully,
truly and strictly in accordance with the design, drawings, specifications and
instructions.
Clause 12. Alteration in specifications and designs: The authority reserves the right
to make any changes in original designs, drawings and specification which shall be
deemed as work included in the original tender and contractor is bound to carry out
the work. The rates of such alterations will be same if any specified in the tender and
if it is not specified in the tender, fresh analysis of rate shall be made taking
departmental schedule of rate at the time of acceptance of the tender.
The contractor may claim revision of rates specified in the tender and the authority
may revise such rates but in the case of any dispute, the decision of authority shall be
final and binding and the contractor shall not suspend work on ground of non-
settlement of rates of items of work.
Clause 14 Action and compensation payable in case of bad works: If any work is
found to have been executed by the contractor with unsound, imperfect and unskilled
workmanship, or materials not conforming to the specifications, the contractor shall
have to rectify it to the satisfaction of the authority. If the contractor fails to do so, he
will be liable to pay compensation at the rate of 1% per day up to maximum limit of
10% of the estimated cost.
Clause 15. Works to be open to inspection: All work at all time shall be open to
inspection and supervision of the authority or his representative. The contractor or his
authorized agents should be present to receive order and instructions.
Clause 16. Notice to be given before the work is covered up: The contractor shall
not cover up or place any work beyond the reach of the measurement without 7 days
notice to the authority, otherwise if the authority desires, the contractor shall have to
uncover the work and no payment shall he made for the purpose.
Clause 17. Maintenance period: The contractor shall be liable for any damage done
or any defects noticed within the prescribed maintenance period.
Clause 18. Contractor to supply tools and plants: The contractor shall have to supply
tools, plant, equipments, appliances, ladders, scaffolding etc. for the proper execution
of work at his own cost. The contractor shall also provide fencing, lighting as per safety
requirements.
Clause 18A. Care of departmental tools and plants: The contractor shall take proper
care and maintenance of all departmental tools and plants issued to him and shall be
liable for any loss or damage caused during the period of possession of the same by
the contractor.
Clause 19. Labour: No labour under the age of fifteen years shall be employed for
work. The minimum wages and amenities of labours shall be maintained according to
the various statutes concerning labour and wages.
Clause 20. Work on Sunday: No work shall be done on Sunday without written
permission of the authority.
Clause 21. Subletting of work: The contractor shall not assign or sublet the contract
without the writ-ten permission from the authority concerned.
Clause 22. Sums payable by way of compensation: All sums payable under the
condition of compensation shall be deemed as reasonable compensation without
reference to the actual loss or damage caused.
Clause 24. Direction of work: All works under the contract shall be execute under the
direction of the authority-in-charge who shall be entitled to direct as to the manner in
which work is to be execute and carried out.
Clause 25. Settlement of disputes: Efforts shall be made to resolve disputes amicably
between the owner and the contractor through mutual discussions and negotiations.
Arbitration clause shall be incorporated in the contract to settle disputes if not resolved
through mutual discussions and negotiations.
Clause 26. Patent rights: In the event of using any patent or design rights, the
contractor shall fully indemnify the government provided the same is not the direct
result of an order passed by the authority concerned.
Clause 27. Lumpsum in estimates: Whenever there are some lumpsum items and it
is proposed to make any intermediate payment, the payment shall be made on the basis
of the certificate of the authority and the specified amount shall not be more than the
value of work done.
Clause 28. Action where no specifications exist: If the specifications for any work
do not exist, such work will be carried out in accordance with the instructions of the
authority.
Clause 29 Retention money: If there is any claim against a contractor, the part or
whole of the security shall be retained. And if the amount of security money is not
sufficient, any amount payable to the contractor shall be retained till the finalization of
the claim as determined by an arbitrator or the competent court.
Clause 30. Supply of water: The contractor shall make his own arrangement for
supply of water for construction work to the satisfaction of the authority and nothing
extra will be paid for this.
Clause 31. Labour camp: The contractor shall at his own cost provide labour camp at
the work site and shall provide all amenities of water supply, sanitation, road
communication, lighting etc. in the labour camp at his own cost.
INSPECTION AND QUALITY CONTROL
The objective of inspection and quality control is to achieve sound construction work which results
in structures of good quality at reasonable cost. Inspection and quality control are required on all
construction projects to ensure that the work is done in accordance with plans, specifications and
good practice and to avoid defects. An entirely safe design may be completely ruined by careless
execution. This can lead to defective work with possibility of failure of the structure. Careful
inspection and quality control is, therefore, as important as the preliminary investigation and
design. As it is very difficult and expensive to rectify a structure after it is constructed, it is
necessary to inspect the structure during its various construction stages. On large jobs, a separate
inspection agency is generally provided to ensure effective inspection and quality control.
In case of large construction projects, a separate inspection agency is generally provided to ensure
effective inspection and quality control. This inspection agency plays an important role in the
execution of works and has diverse duties and responsibilities. For this purpose, an inspector is
generally entrusted with the job of inspection. The inspector professional having knowledge of the
principles and methods involved in the execution of works. He should have the requisite
competence, skill, confidence to get the work done according to the plans and specifications. To
start with, an inspector has to familiarize himself with the plans and specifications of the
construction project. With this background, the inspector should be able to have a good judgement
of everything that he inspects. For efficient inspection, specifications form a very important
consideration and should be studied thoroughly by the inspector. An inspector is generally
authorised to stop any work which is not carried out according to plans and specifications. This is,
however, considered as a last resort when it is clear that unsatisfactory work will result from
continued operations. Thus, in order to avoid faulty construction and delays, inspections should he
made promptly at regular intervals and inspection recommendations implemented immediately.
Inspection should be carried out at appropriate stages as the construction work proceeds. Any
defect noticed during inspection should be pointed out and rectified immediately in order to avoid
unnecessary wastage of time and effort. In construction works, there are certain stages in which
individual items are required to be inspected so as to avoid dismantling of work already completed.
The cutting, bending and fixing of reinforcement, erection of formwork, embedded materials,
placement of concrete etc. call for careful planning and coordination between construction and
inspection teams. The important items required to be inspected during construction are:
• Earth work
• Masonry
• R.C.C.
• Sanitary and water supply services and electrical services
Earthwork
Earthwork in excavation should be carried out after proper layout. The trenches in excavation
should be protected suitably depending on the type of soil and the depth of excavation. The
excavated earth should be stacked at a suitable distance from the edges of trenches. The base of
trenches should be checked for slope/level and type of strata as specified in the drawings. Excess
digging, if any, should be rectified as per instructions of the engineer-in charge. The inspection of
excavation for correctness is the first step in controlling the quality of construction. Once the
foundation is constructed and backfilling completed, it will be very difficult to detect faults in the
foundation structure. Proper earthwork in filling should be checked for compaction in layers so as
to avoid settlement at a large stage. Compaction should he checked with reference to the type of
soil, method of compaction and the specifications.
Masonry
All masonry works should be inspected for type of masonry, materials, bond, alignment, and
verticality etc. Any defect detected in alignment or verticality should be promptly corrected.
Verticality can be checked by using a plumb bob. Another important point to be checked during
inspection is proper filling of joints with mortar. The proportion of mortar is checked before
mixing. The strength of bricks is checked by a compression test. Curing of masonry by a suitable
method should be checked and ensured. In all types of masonry, appropriateness of bond and
breaking of vertical joints should be checked and ensured.
R.C.C.
(i) Reinforcement
• The inspector should check the correctness of reinforcement at the time of its installation.
This is done to avoid costly mistakes which might be detected after substantial
reinforcement has been cut, bent and fixed in place. The inspector should keep the
following points in mind:
• Splicing of reinforcement should be avoided at the points of maximum stress. At splices,
the bar should be properly lapped and/or welded for a sufficient length to transfer the stress
by bond. Splices for reinforcement bars of 20 mm diameter and above may be welded in
accordance with the specifications.
• Too much welding across main bars of reinforcement with under-cuts by electrodes and
torches should be avoided.
• The stirrups in beams and columns should not be positioned until after completion of the
erection of main steel in the form work.
• Proper cover to reinforcement as per specifications should be checked and ensured.
• To obtain concrete of uniform and specified quality, careful inspection and control are
required to ensure:
• Proper mix design;
• Proper concreting practices.
The selection of suitable concrete for a job involves proportioning of the available aggregates,
cement, water, and air entraining agent, if required, in such a manner that the resulting mix meets
the requirements of desired strength, durability, workability and economy. To achieve this, a series
of laboratory tests on materials and field investigations are conducted and concrete mixes of
desired quality are designed.
Proper batching requires measuring correct quantities of ingredients in order to obtain uniform and
homogeneous concrete. This can be done by using automatic weigh-batchers which are capable of
accurate weighing. Special attention should be given to the quantity of water to ensure designed
water-cement ratio in the mix.
For uniform mixing, ingredients should be mixed in the concrete mixer for the specified time.
Proper mixing is indicated by uniform colour and homogeneity of the concrete mass. Concrete
samples are taken periodically at the mixing and placing points for laboratory tests to compare the
actual workability and strength achieved with the specified requirements.
In modern construction most of the sewage and water supply lines are i embedded or concealed
under floors and in walls. It is very difficult to detect defects at a later stage and rectification is
very costly. All sewage lines laid underground or embedded in floors should be checked for slope,
alignment, leak proofing of joints and stability of base. Inspection, measurement and testing should
be carried out before embedding these services. Both water supply and sewage lines should be
tested for leakage by filling water at appropriate pressure. Longitudinal slope of sewers should be
carefully checked during inspection. Manholes or inspection chambers should be provided as
specified. Covers of manholes and inspection chambers should be checked for strength if located
in a passage or road. Suitable arrangement of roof drainage in all buildings should be checked and
ensured during construction. In case this aspect is not given appropriate consideration, it may result
in dampness of roof and walls and ultimately loss of durability of the structure. Appropriate roof
drainage facilitates hygienic and comfortable environment inside the building. Complete layout of
all these services should be shown in the 'as- built' drawings for future reference.
Electrical Services
For providing domestic electrical services should be provided as cables, switches, panels and
meters per specifications. and design. The cable layout should d be designed and indicated on the
drawings. The specifications and design of cables should consider the present and future
requirements. Cables and conduits should be inspected and tested before embedding. The entire
system of electrical power supply should be tested for its faultless service. Effectiveness of
earthing should be checked to ensure safety against electric hazards. While inspecting the layout
of electric conduits and cables, it should be ensured that no chase is cut in the structural
components for embedding the conduits/cables. Position of lights, fans and switches should be
ensured at appropriate heights and locations free from dampness.
Total quality management (TQM) is a system of continuously improving goods or services. The
philosophy was promoted by W. Edwards Deming. A TQM approach is considered as essential to
long term survival of the business, such as construction. In the TQM philosophy, everyone in the
company should feel involved and committed for quality of products, from top to bottom of the
organization. Total quality management provides principles, tools and techniques for cultural
changes and continuous improvement. Quality assurance can be considered as part of Total Quality
Management. Basically, quality assurance is a system of approach which is related to attitudes and
working environment of the company. Deming has suggested 14 points for total quality
management which are –
1. Create constant commitment to the employee for aim and purpose of the company and
improvement.
2. Adopt new philosophy to avoid defects.
3. Use statistical quality control and understand purpose of inspection.
4. Practice of business should be based on statistical evidence rather than price tag alone.
5. Improve constantly and forever production and services.
6. Employee training.
7. Teach and institute leadership.
8. Encourage communication and productivity.
9. Encourage teamwork, to work in group.
10. Eliminate posters or slogans with specific improvement methods.
11. Use statistical methods to continuously improve quality and productivity.
12. Remove barriers that rob people of pride of workmanship.
13. Provide education and self-improvement for everybody.
14. Define top management commitment for quality.
• Everyone in the company should understand the mission and vision of the business.
• Total management should be highly committed to quality.
• Continuous training is required
Contract document
When the tender of a contractor is accepted, an agreement between the contractor and the owner
takes place. The following documents defining the fights and obligations of the owner and the
contractor are attached to the agreement bond and this is called a contract document. Each page of
it bears the signature of the contractor and the accepting authority and all corrections are also
similarly initialled.
Title page
It contains the name of the work, name of owner, name of contractor, contract agreement number,
contents etc.:
Index page
It contains a brief description of work, estimated cost of work, date and time for receiving tenders,
amount of earnest money and security deposit, time of completion etc.
Tender Form
It contains the bill of quantities, contractor's rate and total cost of work, time for completion,
security money to be deposited and penalty clauses etc.
It contains a list of materials to be issued by the department/owner to contractor with the rates and
place of issue.
Drawings
It is a complete set of drawings including plans, elevations, sections, detailed drawings etc. and
site plan, all fully dimensioned.
Specifications
a) General specifications: These specify the class and type of work, quality of materials etc. in
general for the work as a whole.
b) Detailed Specifications: These comprise a detailed description of each item of work including
material and method to be used along with quality of workmanship required.
Conditions of contract
• Rates of each item of work inclusive of materials, labour, transport, plant/equipment and
other arrangements required for completion work
• Amount and form of earnest money and security money to be deposited.
• Mode of payment to contractor including running payment, final pay merit and refund of
security money etc.
• Time of completion of work.
• Extension of time for completion of work.
• Engagement of sub-contractor and other agencies at contractor's co and risk.
• Penalty for poor quality and unsatisfactory work-progress.
• Termination of contract.
• Changes in design/drawings etc.
• Arbitration for settlement of dispute.
Special conditions
Depending upon the nature of work, it mentions about taxes, royalties which are included in rates
and also about labour camp, labour amenities, compensation to labour in case of accident etc. All
the above-mentioned documents collectively constitute a contract document. In general, the
intention of contracting parties is determined from the contract executed by them. The contractor
should carefully read and understand the contract before executing the work.