East Central Railway
Vigilance Organization
DISCUSSION
ON
TENDERS AND CONTRACTS
FOR
RAILWAY DOCTOR’S
ON
30.09.2011
CONTRACT
East Central Railway
Vigilance Organization
• When two or more persons have a common intention
communicated to each other to create some obligation
between them there is said to be an agreement.
• An agreement which is enforceable by law is a contract.
• According to the Indian Contract Act 1872 only those
agreements are enforceable by law which are made by:-
- The true consent of the parties
- Competent to contract
- For a lawful consideration & with a lawful Object
Types of Contracts
East Central Railway
Vigilance Organization
CONTRACTS
EXPENDITURE
EARNING
STORES
WORKS
TYPES OF TENDER
• Open Tenders
• Single Tender
• Limited Tender
• Special Limited Tenders
• Quotations
• Two Packet System
East Central Railway
Vigilance Organization
OPEN TENDER
East Central Railway
Vigilance Organization
• Open tenders can be called against sanctioned works only.
• Approval of competent authority for inviting tender &
tender documents is to be taken.
• Similar nature of work must be approved by PHOD.
• Tenders are to be called with Standard Eligibility Criteria-Should have completed one single work, for a min value
of 35% of advertised tender value in last years
-Should have received total contract amount of 150% of
advertised tender value in last three years
OPEN TENDER
East Central Railway
Vigilance Organization
• Invitation of open tender does not require finance
concurrence.
• However in emergent cases when detailed estimate has not
been sanctioned, pre-vetting of tender schedule by finance
will be necessary.
• Powers to Accept Open Tenders ( RB No 2007/CE-1/CT/13
dated 03.09.2007)
- GM upto 100 Cr
- PHOD upto 50 Cr
- SAG/DRM upto 8 Cr
- JAG upto 2 Cr
OPEN TENDER
East Central Railway
Vigilance Organization
• The standard eligibility criteria can be modified with
concurrence of Finance and personal approval of GM.
• Credential from private individuals should not be
accepted.
• Tender Notice period of min of 30 days should be there
but CAO/DRM can reduce it to 21 days. It can be reduced
to 15 days with Finance concurrence.
• Short tender notice is to be published in newspapers.
However, detailed tender notice and tender documents
must be uploaded of website.
OPEN TENDER
•
East Central Railway
Vigilance Organization
Railways should procure materials from IS(BIS)
approved firms. Independent test should be conducted to
ensure that the materials conform to IS (BIS)
specifications.(RB No 2007/CE-I/CT/8 dated 07.05.08).
• Based on CVC O/O No 15/5/06 and 23/7/07 dated
05.07.07 awarding of tenders on nomination basis is
banned.(10% higher rates).
• JV is permitted in tenders costing more 5 Cr.
LIMITED TENDER
East Central Railway
Vigilance Organization
• The minimum no. of contractors to be borne on the
approved list should not be less than 10.
• Norms of approved list and subsequent criteria laid
down by Board from time to time to be observed.
• The approved list of contractors should be updated as
per extant instructions
• Contractors approved in higher monetary not to be
allowed to participate for works in the lower monetary
slab unless.
- JAG/SG upto 25 Lakh
- SAG/DRM upto 1 Cr
- PHOD/CHOD up to 5 Cr
SPECIAL LIMITED TENDER
East Central Railway
Vigilance Organization
• Should be invited when there is no approved list
• Work of specialised nature [To be approved by PHOD
personally.] CAO can call for all type of works.
• Work of urgent matter [To be approved by GM
personally.]
• May be invited from specialized
contractors /organization/Agencies
and reputed
• No of contractors included in the SLT should preferably
be more than 6 but not less than 4.
• Tender Notice should be given to tenderers whose
names have been approved.
SINGLE TENDER
East Central Railway
Vigilance Organization
• Emergent Situation such as Accidents, Breaches
involving dislocation to traffic.
• Works of specialized nature to be personally approved
by the GM
• False urgency of work is shown.
• Rates awarded are on abnormally higher side.
• For ‘Doubling’ and ‘Traffic facility’ New Line and Gauge
Conversion - CAO/C can call single tenders upto 2 Cr
for last mile stone works.
QUOTATION
East Central Railway
Vigilance Organization
• To dispense with tender and to invite and accept
quotation
• Calling quotations of different grade will require prior
finance concurrence.
• Quotation should not be for items, which can be
executed through the existing contracts including Zonal
contracts during the currency of zonal contract.
• Quotation should not be for fancy [expensive but of low
utility] items.
• Quotations should normally be invited from at least
three well experienced contractors/agency, not
necessarily borne on the approved list.
East Central Railway
Vigilance Organization
Stages in Contract Management
• Pre-tender Stage
• Tender Finalization Stage
• Execution Stage
Pre-tender Activities
• Justification
•
•
•
•
•
•
•
•
Scope of work/ Schedule of Quantities
Estimate for work
Drawings/ Specifications
Tender conditions
Rates/Cost of work (NIT Cost)
Eligibility Criteria
Notice Inviting Tender
Tender Documents
East Central Railway
Vigilance Organization
Notice Inviting Tender
East Central Railway
Vigilance Organization
• For publishing in newspapers the Tender Notice should not be
lengthy and it should contain the following information only(RB
No. 2008/CE-I/CT/21 dt 05.03.2009)
• Name of work and its location, Approximate cost of the work,
Cost of Tender Document/Form
• Address of the office from where the forms can be purchased.
• Earnest Money to be deposited, Completion period of the work
• Date and time for submission of tender and opening of tender
• Website particulars and from where complete tender documents
can be downloaded.
• The website should also specify a date up to which the tenders
may note updates/corrigendum/revised date of opening.
• Details of Postal dispatch of tender forms
Notice Inviting Tender
East Central Railway
Vigilance Organization
• The detail tender notice should also contain:• Eligibility Criteria, Similar Nature of Work,
• Details of pre-bid meeting, if any,
• Name and designation of persons designated for seeking
clarification
• If Law and Order problems are anticipated, tender dropping can
be arranged at more than one place.(Rly.Bd’s L.No. 90/CT-I dt
28.10.98)
• Sale of tender documents should normally start from the date of
publication of Tender Notice. However in any case period of sale
of tender should not be less than 15 days. (Rly.Bd’s L.No.
03/CE/I/CT/85 dt.9.5.94)
Tender Documents
•
East Central Railway
Vigilance Organization
Bid document should not contain obsolete, unwanted matter
and conflicting provisions and therefore it documents must be
standardized.
• The tender documents, tender schedule and tender notice must
be by approved by competent authority before calling of tender.
• The blank spaces in the various clauses should be filled in.
• Alternative wordings required to be struck out are struck.
• The drawing numbers, where necessary are invariably entered.
• Books of Reference mentioned in the tender documents should
be complete and applicable to particular work.
• It should be ensured that all the pages of are numbered and it is
properly bound. Total number of pages and chapters in tender
document must be mentioned.
Special Conditions
East Central Railway
Vigilance Organization
• The General Special Condition of tenders should also include:• The special conditions for carrying out the special work should
invariably be got approved from Headquarters office.(Ref: Bd’s
L. No.99/CE-I/CT/43 dt,5.8.99).
• Maintenance Period; scope of maintenance (items covered
under maintenance conditions).
• Construction and Maintenance of service roads.
• Responsibility of setting out of the work.
• Disposal of dismantled debris.
• Methods of Measurement of Hidden items.
• Organisations from whom test certificate/results are acceptable
• Procedure for collection and sending of samples for testing.
Special Conditions
East Central Railway
Vigilance Organization
• Explosives: Procurement, Transport, Storage, Regulations for
Blasting.
• Site Facilities: Land, Electricity & Water, Availability, Charges
Terms
• Liability in case of non-supply, delayed supply etc.
• Materials to be supplied; specify charges,
• Store from which material will be supplied, Store to which
material can be returned,
• Assessment of weight – as per standard weight or as per
actual? Length of rods to be supplied, Wastage Permitted,
•
Disposal of wastage, Rate for Recovery,
• Safety and Custody of Material
Tender Finalization Stage
Tender Opening
East Central Railway
Vigilance Organization
• Place not mentioned explicitly.
• Not by the nominated officials (Executive and Finance
representative) in presence of tenderers or their
representatives.
• All tender forms, including corrections, not marked on
the same day.
• Samples submission & other relevant particulars not
marked.
• All corrections, over writings etc. not marked in red ink.
• Tender Opening Register not filled up.
Tender Finalization Stage
Tender Opening Register
East Central Railway
Vigilance Organization
• Date of Opening; Name of the Work; Tender Notice
No; Nature of Tender (Open/SLT/Single)
• Number of forms sold and received.
• Late & Delayed Tender;
• Name of Tenderers; EM Deposited Particulars;
• Item wise rate quoted in figure and words both;
• Rebate in figure and words both;
• Signature of Tender Opening Officials along with name
and designation;
• Signature of tenderers or their representatives present
during opening.
Comparative Statement
East Central Railway
Vigilance Organization
• Name of work, Authority of work, Tender notice
number, Tender opening date & time,
• Tenders sold; offers received,
• Tender opened by- name of officials
• Earnest money details,
• Validity of tenders
• Eligibility/Credentials of tenderers,
• Special Conditions by tenderers,
• Samples submitted.
• Comparative Statement.
• Level of Tender committee and accepting authority
East Central Railway
Vigilance Organization
Pre-qualification Criteria
• Pre- qualification is a process to select competent
contractors having technical and financial capability
commensurate the work.
• The pre-requisites of prequalification are:
-Transparency
- Fairness
-Maintenance of competition
• The similar works should be clearly defined.
• The PQ criteria must
unambiguous terms.
be
clearly
stipulated
in
Eligibility Criteria
East Central Railway
Vigilance Organization
• Eligibility criteria is applicable to tenders costing more
than 50 Lakh.
• Verification of Credentials
• Considering the credential in the name of other firms
• Interpretation of Similar Nature of Work
• Scrutiny Works Credential Certificate
• Fulfillment or otherwise not deliberated adequately and
explicitly.
• In case of partnership firm, credential in the name of any
of the partners can be considered.
Tender Committee
East Central Railway
Vigilance Organization
• The TC members must ensure their nomination before
sitting for tender committee meetings. Normally TAA
nominates tender committee as per delegation of power.
• There can be a standing tender committee.
• In case of Single Tender one stage higher TC
( RB’s L.No.94/CE-I/CT/4 dt.17-9-97)
• In case of non- availability, higher grade officer can sit in
the TC.
• If officer competent to be the accepting authority has to
act as member of TC, the recommendation should be
put up to next higher authority, for consideration.
Tender Committee Minutes
East Central Railway
Vigilance Organization
The TC must check and deliberate on the following
• Necessary sanctions / approvals
• Validity of tender, EM, Sample, Lone tender,
• Eligibility Criteria, Similar nature of works
• Reasonableness of Rates
• Single offer in response to LT should be considered
only in ‘very urgent’ cases
• TC and TAA should ensure that the tender documents
were available for downloading and tender notices
were uploaded before publishing in news paper
Tender Committee Minutes
East Central Railway
Vigilance Organization
• The TC should give an undertaking that none of them
has any personal interest in the companies/agencies
participating in the tender process.
• TC should make definite recommendation
facts and reasons etc.
with full
• Factors cited for higher rates, should be explained
adequately. High rates justified on the basis of
urgency, proper facts should be based on record.
• Quantum & nature of work, Location and Site
conditions including law and order condition
• Favourable/unfavourable information suppressed.
• Tender Accepting Authority not indicated.
Role of TAA
East Central Railway
Vigilance Organization
• TAA cannot function as a rubber stamp and must apply
his/her mind independently and such appreciation
should be visible on record. The acceptance or
otherwise must be recorded on the body of TC
proceedings itself and not on the noting side.
• In case of any clarifications required, refer to TC, with
clear queries, and not to any individual member.
• Not to use phrases like “Please discuss” etc.
• Should take decision in reasonable period of time (15
Days).
Role of TAA
East Central Railway
Vigilance Organization
• If Tender Accepting Authority wants to disagree with the
Tender Committee or to agree with some members in
non-unanimous proceedings, TAA must record the
detailed reasons.
• TAA should not take a decision for awarding the contract
or otherwise by relying on information from any other
source except the Tender Committee.
Negotiations
East Central Railway
Vigilance Organization
• Negotiation with L1 only.
• Counter offer tantamount to negotiation.
• Tenderer increases the rates for some items which is
not admissible. Declaration from tenderers as per RB
L. No. 2008/CE-I/CT/1 dated 12.09.08 should be
taken.
• In high value tenders, the tenderer is represented by
their authorized representative who is competent and
empowered to take meaning full and active part in the
negotiation.
• If L1 refuses to accept the counter offer, the tender is
to be discharged. (RB L.No 99/RS/(G)/779/2 dt 22.10.08)
Stages in Supply Contracts
East Central Railway
Vigilance Organization
• Assessment of Demand
• Clubbing of Demand
• Framing of Specifications
• Tendering
• Discussions of offers
• Placement of Purchase Orders
• Receipt and Inspection
• Quantity Variation & Operation of Option Clause
• Extension of Delivery Period
• Cancellation of Contract and Risk Purchase
Limited Tender
East Central Railway
Vigilance Organization
• Firms short listed in advance, based on past experience,
expertise and specialization
• Minimum three firms to be included
• Registered/Approved Firms to be Selected
• In case any firm is U/R, approval of next higher authority
(Min JA Grade) should be taken.
• Tender Inquires to be sent by Registered Post and
Acknowledgement should be kept on file.
• In case of single offer against limited tender the tender
should be discharged. However, in case of extreme
urgency when urgency is expressed by SAG officer, the
case can be accepted. ( JAG has limited power)
Things to Avoid in LT
East Central Railway
Vigilance Organization
• Arbitrary selection of firms to be avoided
• Last supplier to be invariably included
• Registered/Approved firms to be called for Limited
tenders
• Firms with better experience should not be ignored and
firms with dubious credentials should not be selected.
• Inadequate time given for participation in tender
• Bogus firms should not be selected to inflate the
number
• Rates become very important as the competition has
been restricted
Ring Formation
East Central Railway
Vigilance Organization
• Ring/ Cartel formation among the bidders leads to
elimination of competition and award of contract at
exorbitant rates.
• At times, it is done with active collusion with officers
concerned.
• The ring formation becomes more important in case of
limited tenders thus an attempt should be made to
identify sister concerns.
• In case of suspected ring formation with high rates,
tender cancellation is advisable.
• Selection of sister concern has vigilance angle and is a
clear case of ring formation.
Receipt And Inspection
East Central Railway
Vigilance Organization
Check for
• Pre-dispatch inspection facsimile on the material
• Test report of material/certificate
• Verify the quantity
• Periodic testing of materials
• Check whether Shelf life is available as per PO
• MRP mentioned on the supplied drug should not be
less than the PO rate
• Supplies to be checked with reference to contract
specifications.
• Suitability or otherwise for the end use cannot be a
criterion for acceptance or rejection.
Local Purchase of Medicines
East Central Railway
Vigilance Organization
7(a) Local purchase of medicines CMS up to 30,000/in each case
7(b) Emergency purchase power of medical store
including cancer drugs, cardiac, anti-haemophilia
factor, Post renal transplant, growth harmone,
ortho implants, HIV and any other emergency
drugs- CMS up to 30,000/- in each case
7(c) Procurement of small value items whose
aggregate value in a year is less than 20,000/CMS full powers
Local Purchase of Medicines
East Central Railway
Vigilance Organization
• Detailed guide lines have been provide vide CMD/ECR
letter No ECR/MED/RMC/104/Div. Corresp dated 22-0508
• As per this letter
• 7 (a)- Local Purchase
Committee of 3 doctors should identify medicine shops
within 1-2 Km
Rate agreement should be entered for one year with
the firms who give maximum discount on MRP
Payment should be on bill system basis
Local Purchase of Medicines
East Central Railway
Vigilance Organization
• 7 (b)- Emergency Purchase
Quotations should be called from firms registered
with CMD/ECR or their authorized dealers
• 7 (c) AMI itemsLimited tenders through registered firms
Problems
East Central Railway
Vigilance Organization
• Different divisions are adopting different policies- Interpretation is
different e.g.
• SPJ is procuring same medicines under 7 (a) and 7 (b)
• Even after entering into Rate agreement for one year purchases
are being done from other firms after calling their quotations ( at
higher rate also)
• Quotations for same medicine is being called so many times in a
year without mentioning validity/period
• SEE has called for tenders for value > 20,000/- and less than
30,000/- but not procured any medicines during 2010-11
• Payment of day today purchase is being done through imprest in
some division whereas in other division it is through accounts
Cleaning Contracts
East Central Railway
Vigilance Organization
• Quality is questionable
• Quality and quantity of cleaning material is not passed
and measured
• Deployment of man & machine is less than stipulated
• No checks by executives-even 20% check is not done
and not recorded properly on MB
• Area to be cleaned on agreement is more than available
on ground
• Garbage is not transported and thrown to the nominated
places but thrown here and there
Cleaning Contracts
East Central Railway
Vigilance Organization
• Similar work is not approved by PHOD
• MB is not being filled up properly and by nominated official (Even
Group D staff is filling the MB)
• Officials deployed for cleaning do not wear uniform (florescent
jacket etc) as laid down in agreement
• Log book of tractor/trailor not being maintained to measure the
disposed qty
• Penal Clause is not appropriate
• No check on mandatory license e.g. labour registration, minimum
wages act, safety rules etc by Railway although Railway is
Principal Employer in such cases
• Eligibility Criteria is different in different division
• Similar work is not defined properly. It varies from place to place
Accountal of Material
East Central Railway
Vigilance Organization
• Word similar type is misused and instead of reputed
brand, locally made materials are used
• Material are being taken without inspection/passing,
• Material should be issued in commensurate with progress
and excess materials should be taken quickly.
• Disposal of rejected material and records
Measurements
East Central Railway
Vigilance Organization
• Must be recorded by prescribed officials.
• Includes all tests etc. (Collection of Certificates).
• Proper records .
• Test Check (to be indicated clearly).
• Recording to be in MB only, at site of work.
• Location of work must be clearly mentioned.
East Central Railway
Vigilance Organization