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Regulatory Framework

Plain-language definitions of every Regulatory Framework term that shows up in government tender work.

Regulatory Framework

CVC Integrity Pact

The CVC Integrity Pact is a mandatory anti-corruption agreement between the government buyer and all bidders for contracts above Rs 1 crore, supervised by an Independent External Monitor.

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Regulatory Framework

GFR Rule 155, Bid Security (EMD)

GFR Rule 155 requires central government bidders to submit Earnest Money Deposit at 2-5% of estimated cost as bid security, with exemptions for MSMEs and DPIIT startups.

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Regulatory Framework

GFR Rule 158, Performance Security (PBG)

GFR Rule 158 requires the contract winner to furnish a Performance Bank Guarantee at 5-10% of contract value before executing the agreement, ensuring contract performance through the defect liability period.

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Regulatory FrameworkGST

GST (Goods and Services Tax) in Procurement

GST applies to all government contract supplies at rates of 5-18% depending on category, with works contracts taxed at 12%, and must be quoted separately in government bids unless the NIT specifies inclusive rates.

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Regulatory FrameworkTDS

TDS (Tax Deducted at Source) in Contracts

TDS is deducted by government departments at source from contractor payments, typically 1-2% under Section 194C for works contracts, reducing the net cash received by the supplier.

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