1. DISCUSSION ON
TENDERS AND CONTRACTS
FOR
RAILWAY DOCTOR’S

2. CONTRACT
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

3. Types of Contracts
CONTRACTS
EARNING
EXPENDITURE
STORES
WORKS

4. TYPES OF TENDER
Open Tenders
Single Tender
Limited Tender
Special Limited Tenders
Quotations
Two Packet System

5. 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. 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. 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. 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. 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. 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. 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. QUOTATION 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. Stages in Contract Management
Pre-tender Stage
Tender Finalization Stage
Execution Stage

14. 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. Notice Inviting Tender
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

16. Notice Inviting Tender
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 )

17. Tender Documents
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.

18. Special Conditions
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.

19. Special Conditions
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

20. Tender Finalization Stage 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.

21. Tender Opening Register
Tender Finalization Stage
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.

22. 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. 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. 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. 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. 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. 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. 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. 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. Negotiations 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. Stages in Supply Contracts
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

32. 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. Things to Avoid in LT 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

34. 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. 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. 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. 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. Local Purchase of Medicines
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

39. Problems
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. 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. 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. 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. Measurements 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.