(1) The
procurement contract shall have to specify the grounds in which such contract
may be terminated.
(2) The main grounds under Sub-section (1) may be the following:-
(a) Grounds that the Public Entity may terminate procurement
contract if the supplier, consultant, service provider or
construction entrepreneur breaches the procurement contract,
(b) Grounds that the Public Entity may terminate the procurement
contract on the grounds of convenience for public interest,
(c) Grounds that a supplier, consultant, service provider or
construction entrepreneur may terminate the procurement
contract, and
(d) Grounds that procurement contract may be terminated for
force majeure.
(3) A procurement contract shall include along with the following
matters the provision of financial settlement and compensation to be made in
the event of termination of the procurement contract:-
(a) If payment is remaining to be made for the value of work,
supply or service that has already been satisfactorily
completed, payment thereof,
(b) Liability to be borne by a defaulting supplier, consultant,
service provider or construction entrepreneur for the increased
cost to be incurred by the Public Entity to carryout or cause to
be carried out the work under the procurement contract,
(c) Amount of the actual loss sustained by the supplier or
consultant or service provider or construction entrepreneur due
to the termination of procurement contract by the Public Entity
without any default on his/her part.
(4) Unless otherwise provided in the procurement contract, for public
interest, the Public Entity may terminate a procurement contract on the grounds
of convenience.
(5) Where a procurement contract has been terminated pursuant to Sub-
section (4), the Public Entity shall have to pay the value for the following work
that has been completed prior to the termination of the said contract :-
(a) Payment due under clause (a) of Sub-section (2),
(b) Where expenditure is to be paid on reimbursement basis, such
expenditure as actually incurred,
(c) The price of the goods specially manufactured for the Public
Entity under the procurement contract,
(d) Excluding the lost profit and the amount under clause (c) of
Sub-section (3), the expenditure incurred for termination of
the procurement contract, and
(e) Other expenditure as prescribed.