| S.No. | Field / Checkpoint | Reference | Status |
|---|---|---|---|
| A. COMMERCIAL DEVIATIONS | |||
| A1 | Payment terms deviation Acceptance: Documented | NIT terms vs offered | OK NC NA |
| A2 | Price adjustment / escalation deviation Acceptance: Per CPWD / MoRTH formula | PA formula | OK NC NA |
| A3 | Defects Liability Period deviation Acceptance: Bidder DLP ≥ NIT | NIT DLP typically 12-24 months | OK NC NA |
| A4 | Performance security / retention deviation Acceptance: Per NIT or higher | 5-10% PBG, 5% retention typical | OK NC NA |
| B. PRICE IMPACT | |||
| B1 | Quantified cost impact of each commercial deviation Acceptance: Loaded on bid value to derive evaluated price | Engineering estimate | OK NC NA |
| C. ACCEPTANCE | |||
| C1 | Accept / Reject + reasoning Acceptance: Final evaluated price computed | Tender committee | OK NC NA |
During tendering, contractors evaluate the client's terms + conditions + commercial provisions (payment terms, BG requirements, retention, LD, escalation, etc.). Where the contractor cannot or will not accept a clause as-tendered, they propose a commercial deviation — an alternative formulation acceptable to them.
The Commercial Deviation Sheet is the structured format for documenting these proposed changes. Each row: clause reference, original text, proposed deviation, justification, contractor's preferred terms. The client reviews + accepts / rejects / negotiates each line.
Without a deviation sheet, contractors bid with unspoken reservations; conflicts emerge mid-execution as 'we always meant something different'. The sheet brings these into the open before contract signing — saving substantial dispute cost later.
1. Payment terms — advance, retention %, payment cycle (monthly vs quarterly), pay when paid, LC vs cash 2. Bank Guarantees — type (conditional vs unconditional), amount, validity, return conditions 3. Liquidated Damages — daily LD rate, cap, types of delay covered, force majeure exclusions 4. Price escalation — formula reference (e.g., RBI WPI, project-specific), trigger conditions, sharing ratio 5. Insurance — coverage amounts, who bears insured / uninsured risks 6. Force Majeure — events covered, notification requirements, time relief 7. Dispute Resolution — arbitration vs court, seat of arbitration, language, applicable law 8. Termination — convenience termination compensation, fault termination procedures 9. Intellectual Property — design ownership, drawings copyright 10. Indemnity + Limitation — limits of contractor's liability for damages 11. Assignment + Subcontracting — client's consent requirements 12. Taxation — GST treatment, withholding tax, EOI / WCT for cross-border
1. No deviation sheet submitted — contractor accepts all terms in tender response without flagging issues; surprises during execution → arbitration.
2. Deviation buried in narrative — proposed change mentioned in cover letter but not in structured format. Client misses it; later disputes 'never agreed'.
3. No commercial impact assessed — proposed deviation accepted by client but contractor hasn't priced the impact on their side; later cost claim.
4. Justification weak — deviation proposed without rationale; client rejects without considering merit.
5. Multi-cycle negotiation — deviation negotiated 3-4 cycles back + forth; final agreement unclear without crystallized text.
6. Conflicts with technical deviations — commercial change implies technical change but technical deviation sheet not updated.
7. Authority concerns — proposed deviation accepted by client's procurement team but later rejected at board level → contract un-signable.
8. No comparison to industry standard — deviation looks one-sided; benchmarking against FIDIC / NHAI standard practice often clarifies what's reasonable.
Companion formats: - Deviation Sheet — Technical (FMT-TND-011) — technical specification deviations - Letter of Award (FMT-TND-014) — contract award; deviations become part of contract - Performance BG Submission (FMT-TND-015) — BG-related deviations - Financial Bid (FMT-TND-004) — pricing - Contract Amendment Log (PMC-BIL-LOG-004) — for post-signature amendments
Process governance: - FIDIC General Conditions — Red / Yellow / Silver Book (international contract standards) - NHAI / MoRTH / CPWD standard contracts (Indian government) - Indian Contract Act 1872 — legal basis for negotiation + alteration - GFR (General Financial Rules) 2017 — for government procurement