EMD & SD in Stores - Differences between

                                        

                                      Differences between EMD & SD in Stores 

	EMD  Earnest Money Deposit	SD Security Deposit
Calculated on	Tender Value	Contract value
Rounded off to nearest higher	Rs. 10	Rs. 10
Up to Rs. 25 Lakhs	Nil	Nil
Rs. 25 Lakhs to Rs. 50 Crore	2%	5%
	Maximum is Rs.20 Lakhs	Maximum is Rs. 50 Lahs
Above Rs. 50 Crore	Fixed Rs. 50 Lakhs	Fixed Rs. 1 Crore (Global Tenders - No ceiling)
Valid for	Final bid validity period plus 45 days	Date of completion of all contractual obligations plus 60 days
If not submitted	Offers shall be summarily rejected	The EMD shall be forfeited and case be dealt with as that of withdrawal of offer by the Tenderer as per extant instructions
	EMD  Earnest Money Deposit	SD Security Deposit
Forfeit	If withdraws the Offer within validity  or  If not submit the balance SD within 21 days in case of awarding the Stores contract	In case of failure by the Supplier to meet deliveries for any lot, Railway may cancel the Contract for default part by forfeiting SD commensurate to that lot
Exempted cases	1.Up to Rs. 25 Lakhs  2. Govt Depts 3. Other Railways 4. Indian Ordnance factories 5. Railway PSUs 6. MSEs	1.Up to Rs. 25 Lakhs  2. Govt Depts 3. Other Railways 4. Indian Ordnance factories 5. Railway PSUs
Exempted for Single Tender / PAC items	Hqrs:  1. Personal Approval of TAA, not below the level of PCMM. 2. Finance concurrence not required 3. Decided on case to case basis  4. Suitably incorporated in the Tender conditions Field Units:  1. Personal approval of TAA, but not below the SAG level  2. Finance concurrence is required 3. Decided on case to case basis 4. Suitably incorporated in the Tender conditions	Hqrs:  1. Personal Approval of TAA, not below the level of PCMM. 2. Finance concurrence not required 3. Decided on case to case basis  4. Suitably incorporated in the Tender conditions Field Units:  1. Personal approval of TAA, but not below the SAG level  2. Finance concurrence is required 3. Decided on case to case basis 4. Suitably incorporated in the Tender conditions
Debarment - exemption in case of False declaration	6 Months	6 Months

Note: 

1. In exceptional cases, Railways reserves the right to increase the upper ceiling of Security Deposit, up to 10% of the contract value.
2. SD clause is applicable - Risk purchase clause shall not be applicable 
3. SD clause is not applicable - Risk purchase clause shall be applicable 

 

LD – Liquidated damages for delayed supply

 

• 0.5 % of the price of stores per week or part of the week of delay

 

• Upper limit – 10% of the value of contract (irrespective of delays)

 

end

 

 

EMD – Earnest Money Deposit (as per GCC for Works – Nov, 2018)

EMD – Earnest Money Deposit

(as per GCC for Works – Nov, 2018)

ü  Earnest means – Showing sincere interest/serious in participating the Tender process, if awarded executing the Work for Organizations like Indian Railways.

ü  EMD – Earnest Money Deposit – means an earnest payment as specific form of Deposit to demonstrate that the applicant is serious/sincere to participate the Tender work and complete the work for orgnisations like Indian Railways, if awarded.

ü  EMD Rates are as follows.

Value of the Work	EMD Amount ( Rounded to a nearest Rs.100)
Up to Rs.1 Crore	2 % of value of the work
Beyond Rs. 1 Crore	Rs. 2 lakhs + 0.5 % of the excess of the estimated cost of work beyond Rs.1 Crore

ü  Maximum EMD is Rs. One Crore only.

Examples for calculation of EMD under different circumstances: -

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1.       Value of Work  - Rs. 25,60,520

2 % of Rs.25,60,520  - Rs. 51,210

Answer is Rs. 51,200 /- (Rounded off to a nearest Rs.100)

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2.       Value of Work  - Rs. 4,00,00,000 ( Rs. Four Crores)

First one Crore	Rs.2,00,000 (Rs. Two Lakhs)
One Crore to Four Crore ( 3 Crores)	Rs.3 Crores x 0.5 % = Rs. 1,50,000 (Rs.1.5 Lakhs)
For Value of Rs.4 Crores	Rs.2 Lakhs plus Rs.1.5 Lakhs = Rs.3.5 Lakhs

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3.       Value of Work  - Rs. Two Hundred Crores

First one Crore	Rs.2,00,000 (Rs. Two Lakhs)
One Crore to Two Hundred Crore ( 199 Crores)	Rs.199 Crores x 0.5 % = Rs.99,50,000
For Value of Rs.200 Crores	Rs.2,00,000 plus Rs.99,50,000 = Rs.1,01,50,000.  However maximum EMD is Rs.1 Crore.  So EMD is Rs.1,00,00,000/- ( Not Rs.1,01,50,000)

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ü  EMD is applicable to all modes of Tenders such as Open, Limited, Single etc.

ü  Exemption for Submission of EMD – Firms recognized as “STARTUPS” by DIPP (Dept of Industrial Policy & Promotion.

ü  EMD of Successful Tenderer – Retained as part of Security Deposit.  But Railway shall return the EMD, if a Successful Tenderer submit “Term Deposit Receipt (TDR) / Bank Guarantee Bond towards the Full Security Deposit.

ü  EMD shall be deposited in Cash (through E-Payment Gateway) or as mentioned in Tender documents.

ü  EMD of unsuccessful Tenderers – Returned to them. But Railway is not liable to pay the depreciated value, if any or any interest on EMD.

ü  Forfeit of EMD:

1.       If the successful tenderer unable to submit the PG – Performance Guarantee within validity of time, or

2.       If the successful Tenderer resile/abandon from his offer, Or

3.       Modify the terms and conditions there of in a manner not acceptable to the Railways.

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