(a) As provided in section 3 of the Act, where a violation is found
of any contract stipulation, the contract is subject upon written notice
to cancellation by the contracting agency, whereupon the United States
may enter into other contracts or arrangements for the completion of the
original contract, charging any additional cost to the original
contractor.
(b) Every contractor shall certify pursuant to Sec. 4.6(n) of
subpart A that it is not disqualified for the award of a contract by
virtue of its name appearing on the debarred bidders list or because any
such currently listed person or firm has a substantial interest in said
contractor, as described in Sec. 4.188. Upon discovery of such false
certification or determination of substantial interest in a firm
performing on a Government contract, as the case may be, the contract is
similarly subject upon written notice to immediate cancellation by the
contracting agency and any additional cost for the completion of the
contract charged to the original contractor as specified in paragraph
(a). Such contract is without warrant of law and has no force and effect
and is void ab initio, 33 Comp Gen. 63; Decision of the Comptroller
General, B-115051, August 6, 1953. Furthermore, any profit derived from
said illegal contract is forfeited (Paisner v. U.S., 138 Ct. Cl. 420,
150 F. Supp. 835 (1957), cert. denied, 355 U.S. 941).
