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East Central Railway Vigilance OrganizationDISCUSSIONON TENDERS AND CONTRACTS FOR RAILWAY DOCTOR’S ON30.09.2011.

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Presentation on theme: "East Central Railway Vigilance OrganizationDISCUSSIONON TENDERS AND CONTRACTS FOR RAILWAY DOCTOR’S ON30.09.2011."— Presentation transcript:

1 East Central Railway Vigilance OrganizationDISCUSSIONON TENDERS AND CONTRACTS FOR RAILWAY DOCTOR’S ON

2 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 ObjectCONTRACT

3 East Central Railway Vigilance Organization Types of Contracts CONTRACTS EARNING EXPENDITURE STORESWORKS

4 East Central Railway Vigilance Organization Open Tenders Single Tender Limited Tender Special Limited Tenders Quotations Two Packet System TYPES OF TENDER

5 East Central Railway Vigilance Organization OPEN TENDER 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

6 East Central Railway Vigilance Organization OPEN TENDER 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 ) - GM upto 100 Cr - PHOD upto 50 Cr - SAG/DRM upto 8 Cr - JAG upto 2 Cr

7 East Central Railway Vigilance Organization OPEN TENDER 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.

8 East Central Railway Vigilance Organization OPEN TENDER 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 ). Based on CVC O/O No 15/5/06 and 23/7/07 dated awarding of tenders on nomination basis is banned.(10% higher rates). JV is permitted in tenders costing more 5 Cr.

9 East Central Railway Vigilance Organization LIMITED TENDER 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

10 East Central Railway Vigilance Organization SPECIAL LIMITED TENDER 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 and reputed contractors /organization/Agencies 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.

11 East Central Railway Vigilance Organization SINGLE TENDER 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.

12 East Central Railway Vigilance OrganizationQUOTATION 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.

13 East Central Railway Vigilance Organization Stages in Contract Management Pre-tender Stage Tender Finalization Stage Execution Stage

14 East Central Railway Vigilance Organization 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

15 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 ) 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

16 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 ) 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 ) Notice Inviting Tender

17 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. Tender Documents

18 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

19 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 Special Conditions

20 East Central Railway Vigilance Organization Tender Opening 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

21 East Central Railway Vigilance Organization Tender Opening Register 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. Tender Finalization Stage

22 East Central Railway Vigilance Organization Comparative Statement 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

23 East Central Railway Vigilance Organization Pre-qualification Criteria 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 be clearly stipulated in unambiguous terms.

24 East Central Railway Vigilance Organization Eligibility Criteria Eligibility Criteria 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.

25 East Central Railway Vigilance Organization Tender Committee 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 ) 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.

26 East Central Railway Vigilance Organization Tender Committee Minutes 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

27 East Central Railway Vigilance Organization Tender Committee Minutes 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 with full facts and reasons etc. 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.

28 East Central Railway Vigilance Organization Role of TAA 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).

29 East Central Railway Vigilance Organization Role of TAA 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.

30 East Central Railway Vigilance OrganizationNegotiations 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 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 )

31 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 Stages in Supply Contracts

32 East Central Railway Vigilance Organization Limited Tender 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)

33 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 Things to Avoid in LT

34 East Central Railway Vigilance Organization Ring Formation 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.

35 East Central Railway Vigilance Organization Receipt And Inspection 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.

36 East Central Railway Vigilance Organization Local Purchase of Medicines Local Purchase of Medicines 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

37 East Central Railway Vigilance Organization Local Purchase of Medicines Detailed guide lines have been provide vide CMD/ECR letter No ECR/MED/RMC/104/Div. Corresp dated 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

38 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 items- Limited tenders through registered firms Local Purchase of Medicines

39 East Central Railway Vigilance OrganizationProblems 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 Payment of day today purchase is being done through imprest in some division whereas in other division it is through accounts

40 East Central Railway Vigilance Organization Cleaning Contracts 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

41 East Central Railway Vigilance Organization Cleaning Contracts 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

42 East Central Railway Vigilance Organization Accountal of Material 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

43 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.Measurements

44 East Central Railway Vigilance Organization


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