I am assuming the instruction was a change to the Works Information and that a compensation event was notified along with a corresponding instruction to submit a quotation.
The scope of works should be treated as a ‘configuration control exercise’ with contractual notifications and instructions providing a clear auditable trail linking to all the changes from the tendered baseline. The Contractor is obliged to administer the contract in accordance with these instructions, the last of which would be the December 2016 one, so they are right to suggest that the quotation should be assessed on this instruction. This being the case, may I suggest issuing a further instruction / notification to reflect the actual agreed scope of works…