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CAMTECH, Gwalior

CAMTECH, Gwalior

Disclaimer
This lecture is for orientation purpose
only, and should not be used as a
reference.

Participants are requested to follow


latest instructions, as issued from time
to time by Railway Board, RDSO etc.
CAMTECH, Gwalior

Canons of Financial Propriety


(Finance code Vol-I Para 116)
 The expenditure should not prime facie be more than the
occasion demands and that every Govt. Servant should
exercise the same vigilance in respect of expenditure
incurred from public money as a person of ordinary
prudence would exercise in respect of the expenditure of
his own money.

 No authority should exercise its powers of sanctioning


expenditure to pass an order which will be directly or
indirectly to its own advantage.
CAMTECH, Gwalior

Canons of Financial Propriety

 Public money should not be utilised for the


benefit of a particular person or section of
the community.

 The amount of allowances such as TA,


granted to meet expenditure of a particular
type, should be so regulated that the
allowances are not on the whole source of
profit to the recipients.
CAMTECH, Gwalior
Terminology
(The Indian Contract Act‘ 1872)
Contract- An agreement enforceable by law
(must create legal obligation/duty).
Agreement- Every promise/set of promises forming
consideration for each other.

Promise- Accepted proposal/offer (written/oral/implied)


(Un-conditional, clear & definite).

Proposal- willingness of promisor to do or abstain(to keep


one self away) from doing anything with a view
to obtain assent(consent) of promisee.

Consideration- An act or abstinence (self denial) or


promise of something.
All contracts are agreements but not vice versa
CAMTECH, Gwalior
What is Contract ?
An agreement which is enforceable by law is
termed as a contract.

What is Agreement ?

When two or more persons have a common intension


communicated to each other to create same obligation
between them’ is said to be an agreement. An agreement
may or may not be enforceable by law.

What is Tender ?

A tender is a sort of bid or offer made by a party/


contractor/firm for the execution of work or supply
of materials under certain specified conditions &
within prescribed time limits.
CAMTECH, Gwalior

Contract stages
 Abstract Preparation & Sanction

 DE preparation & Technical Sanction

 Decision on Mode of Tendering

 Preparation of Tender Documents

 Notice Inviting Tenders [ NIT ]

 Sale of Tender Documents

 Opening of Tenders
CAMTECH, Gwalior

Contract stages
 Preparation of Briefing Note

 Consideration of Tenders

 Award of Contract

 Payment

 Disputes Management [ Arbitrational issues ]

 Variation Statement

 Completion Report
CAMTECH, Gwalior

Tender System
As per engineering Code Para 1210, it is the
primary duty of the executive to obtain the best
value possible for the money spent. Tender system
should be given a very careful and serious
consideration in all cases.
When the value of work exceeds quotation basis
power (Up to 2 Lakh JAG has power for 3
quotation and SAG upto 4 Lakhs ) it should be
proposed through tender procedure.

 First estimated cost of work should be worked out


on the basis of LAR/ budgetary quotations.
 Detailed justification should be made and
administrative approval should be obtained from
competent authority.
CAMTECH, Gwalior
Objectives of Tendering
 To get most economic rates for prescribed
standards.
 Getting work done through external agency
within target date.
 Procurement of material from OEM/ Traders.
 Equity in selection.
Types of Tenders
1. 1. Open Tender
2. Two packet Tendering System
3. 2. Limited Tender
4. 3. Special Limited Tender
5. 4. Bulletin Tender
6. 5. Single Tender
7. 6. Quotations
8. 7. IREPS(IR‟s E-Procurement System)
CAMTECH, Gwalior

Open Tender
 It is a system of invitation of tender by public
advertisements in most open public manner.

 Any person on payment of the tender cost can


purchase tender document.

 These are resorted to get enough competition & rates


for the work.

 As a general rule, all the tenders must be the open


tenders, except where the situation warrants.
 In open tenders, if a single offer has been received, it
can be examined by Tender committee but in case of
Limited tender, fresh tender should be invited except in
very urgent cases taking approval of SAG officer.
 (RLy Bd. L. No. 50/145/3/5 dated 01/04-08-1951)
CAMTECH, Gwalior

Calling & Acceptance of Open Tenders


 Delegation of Powers to approve tender
schedule, invite and accept open tenders.

Accepting Authority Power of acceptance of Works


Tenders (For each tender)
SG/JAG Upto 4 Crores
SAJ/DRM/ADRM/CWM Above Rs. 4 Crores & Upto 20 Crores
CHOD in S.A. Grade Above Rs. 20 Crores & Upto 75 Crores

AGM/PHOD in HAG Above Rs. 20 Crores & Upto 100 Crores

CAO/Const. Above Rs. 20 Crores & Upto 300 Crores

CAO/Const. Above Rs. 20 Crores & Upto 500 Crores


(for National projects)
[ RB L. No. 2007/CE-I/CT/O/20/1 dated 08.10.2015 ]
CAMTECH, Gwalior

Following documents should be submitted :-

• List of personnel, organization available

• List of plant and machinery on hand and


proposed to be inducted.

• List of works completed in last three years and


works in hand

(Recommendations of the committee of Shri B.S. Sudhir chandra as


approved by Rly. Board Vide letter no. 94/CE-I/CI/4 dated 17/10/2002)
CAMTECH, Gwalior

Advertisement of tender
 While publishing tender in news papers, CPRO must
ensure that NIT has already been uploaded on the
website by taking certificate from executive.

 Any open tender not having token of confirmation (in


the form of internet download record), it will be
treated as inadequately advertised tender.

(Rly Bd letter No. 2008/RS(G)/779/2 Dated 7/11/2008)


CAMTECH, Gwalior
Check List
1. Advertise high value tenders in National news papers.
2. Minimum gap between publication & opening - 30 days.
3. Tender form to be available for sale 3 weeks before opening
(Minimum 15 days before for small value).
4. Curtailment of notice period (min. 21 days) with prior finance
concurrence.
5. Reduction of NIT from 21 days (but not less than 12 days in any
case) in rare exceptional cases of small value works shall be
exercised by DRMs with concurrence of FA & CAO- Reason should
be recorded. ( Bd L.No.-2007/CE-I/CT/18 pt.II dt. 30.07.2010)
6. Sale of tender form not to be denied.
7. Date from which tender document would be available to be notified
and not be less than 15 days before tender opening date. ( Bd. Letter
No.-2001/CE-I/CT/20 dt. 17.08.2001)
8. Corrigendum's to be published before original date of opening.
9. News paper cutting must be pasted on tender file
10. Get estimate sanctioned before invitation.
11. If specification after undergo a major change, re-invite tender.
12. Scope of work, completion time is known.
13. Drawing / Site is ready.
14. Requirement of all participating department have been taken care
of in the scope of work.
CAMTECH, Gwalior
Single Tender
Single tender may be invited with CA‘s Approval in case of:-
 Emergent Situation,

 Accident,
 Breaches involving dislocation of traffic (separate powers) and

 AMC of Equipment.

• No post-facto sanction.
 This is resorted to in rare and emergent situations such as accidents,
derailments, dislocation to traffic, some in-escapable situations as
decided by GM with prior concurrence of FA&CAO.

 AMCs for the equipments may be placed on single tender basis on


authorized dealers with the approval of GM.

 Selection of agencies should be from the approved list of contractors


on the zone, except specialized nature of work.

 Detailed justification should be spelt out.

 All the cases of single tender shall require prior finance concurrence
before the administrative approval.
CAMTECH, Gwalior

Limits of Single Tender


Limits
 Up to Rs. 20 Lakhs per case per PHOD subject to
annual limit of Rs. 1 Crore (prior finance concurrence
at the level of FA& CAO).
 Up to Rs. 10 Lakhs per case per DRM subject to
annual limit of Rs. 50 Lakhs (prior finance concurrence
at the level of Sr. DFM).
 All Single Tender cases (other than stores) will require
GMs personal sanction and FA & CAOs concurrence.
 TC & Accepting authority should be one step higher.
 Note: GMs may delegate power to PHODs/DRMs in
consultation with FA&CAOs to enter into Annual Maintenance
Contract (AMC) for equipments with authorized dealers on
single tender basis based on justified local conditions.
 (Railway Board Letter No. 2011/F(X)/II/5/11 Dated 26/08/2013)
CAMTECH, Gwalior
Limited Tender
1. At times, offers are invited from Limited Tenderers from the approved
list to save the time for smaller value of work and specialized in nature.

2. Where it is not considered practicable or advantageous to call for open tender,


LT may be invited with concurrence of finance and approval of competent
authority.

a. Limited Tender from the contractors borne on the approved list only.

b. Notice for LT should be sent to all eligible Contractors borne on approved list
and should also be published in Local News Papers and displayed on Notice
Boards and put on Internet. [Rly Bd. L.No.-94/CE-I/CT/4 dated 22.10.2001]

c. Rly. May decide category of works for which list of approved contractors shall be
maintained for each monetary slab.

 The reasons for inviting limited tenders should be kept in record.

 There should be minimum 10 Firms Registered for limited tender

 In case of insufficient response & Ring formation is suspected, Railway


may invite open tenders.
CAMTECH, Gwalior
Monetary Slabs for calling Limited Tenders
 Notice for LT should be sent to all eligible contractors
borne on approved list, should also be published in local
news papers & notice Boards & internet site.

(Board letter No. 94/CE-I/CT/4 dated 22.10.2001)


Lowest Authority
S.No Monetary Slab for LT competent to approve
calling of LT
1. Up to Rs. 37.5 Lakhs JAG/ SG

2. More than Rs. 37.5 Lakhs & Up to Rs. SAG/ DRM


1.5 Crore
3. More than Rs. 1.5 Crore & Up to Rs. 75 HOD/ PHOD
Crores

[R.B. LETTER No. 2013/CE-I/CTO/20/PO/Pt II (o) Dt.26.11.2013]


Special Limited Tender (SLT): CAMTECH, Gwalior
1. For important works, special limited tender can be invited.
 These tenders may be invited from specialized and reputed contractors/ agencies.
 Special limited tender be processed with finance concurrence and approval of competent
authority under following situations -
• Works of specialized nature (PHOD approval)
• Work of urgent nature (GM approval)
• Consultancy works (GM approval)
2. Tenderers need not necessarily be borne on approved list.
3. Offers for SLT should be invited from atleast 6 firms but not less than 4.
3. Each tenderer to fulfill eligibility criteria.
(RB VIDE LETTER NO. 94/CEI/CI/4 DATED 17/10/2002)

3. Board has decided that CAO(C) with the concurrence of FA&CAO(C) may invite SLT not only for
specialized nature of work, but all type of works depending upon the merit of the case...
(Board‘s Letter dated 28.09.2007)
4. Delegation of Powers
Authority Competency Remarks
GM -- All type of works on case to case
basis with FA & CAO concurrence
CAO (C) 1 Crore
PHOD 50 Lakhs Only works of special nature with
finance concurrence
DRM 50 Lakhs
CAMTECH, Gwalior

Bulletin Tender:
It is floated for procurement of many items through stores or works to be
executed. These are processed through bulletins by stores department.

Dispensing with Tendering ( Calling Quotations)


 Except where for reason which should be in public interest, it is not practicable
or advantageous to call for tenders, calling of tenders can be dispensed with by
GMs.

 In all other cases where it is decided not to call for tenders, the reason should
be recorded and financial concurrence obtained.

 Any work proposal value up to Rs. 2 Lakhs can be processed through work
order by calling quotations.

 Work order should be open to all contractors and minimum 3 quotations


are required.

 Attempt should not be made to split the work to bring the proposal under
work order limit.
CAMTECH, Gwalior
Dispensing with Tendering
AUTHORITY FINANCIAL LIMIT ANNUAL CEILING

Sr. Scale 1,00,000 5.0 lakhs


JAG 2,00,000 20.0 lakhs
SAG 4,00,000 40.0 lakhs
(Rly Bd’s letter No. 2007/CEI/13/PT Dt 05/03/2009)
a. The works should not be split up for the purpose of bringing it within the ambit of
this dispensation.
b. The reasonableness of rates should be gone into objectively by the accepting
authority.
c. Quotation should not be for items which can be executed through existing
contract.
d. Quotation should not be called for fancy items.
e. Quotations should only be called for works which are urgent in nature.
f. Quotations should be invited from atleast 3 well experienced agencies.
g. Accepting authority must take precautions to see that quotations are from genuine
firms.
CAMTECH, Gwalior
Dispensing with Tendering
h. A register showing full details of works authorised shall be maintained by each
officer and this should be open to verification by Accounts while passing the bills.
i. Sealed quotations for the work may be invited from the contractor working on area
and selected by officer incharge.
j. The quotation should normally be invited with a minimum notice period of 7 days.
For lesser period, reason should be recorded in writing.
k. The quotations so obtained should be deposited in sealed box kept for the
purpose in the office.
l. The box should be opened at the appointed time and date and quotations readout
before parties.
m. The quotations should be numbered and initialed by the officer opening them and
evaluated and tabulated.
n. For cost more than Rs. 10,000/-, an account representative shall be associated.
[ Bd. Letter 81/W1/Ct/26 (com) dt. 30.01.1986]
o. Powers to be exercised only by field officers & their controlling HODs not by other
HQ officers.
p. Finance Concurrence is necessary.
q. Prior administrative approval of competent authority should be taken for calling
quotations duly recording justification and indicating agencies.
CAMTECH, Gwalior
Dispensing with Tendering
r. SD and PG clauses may be added in terms and conditions to successful firm.
s. No extension in completion period should generally be granted without penalty.
t. Finance concurrence may be taken after opening the sealed quotations in
presence of SSO.
u. Before calling quotations under revenue for value more than Rs. 2.0 Lakhs,
estimate should be prepared and sanctioned after finance concurrence.
CAMTECH, Gwalior

IREPS
[ Indian Railway e-Procurement System ]
Training to all Department user of Zonal
Railways, PUs and CTIs for implementation
of “E-Tendering in Works Contract”
(RLy Bd letter No. 2014/CE-I/WP/5 dt. 05.02.2016 & 16.02.2016)

Hon‟ble MR has launched IREPS (Works)


module portal and implemented e-tendering
in works contracts.
CAMTECH, Gwalior

Introduction - IREPS
Continue….

All Zonal Railways have been advised to ensure full


implementation of E-tendering in atleast 50% of
the works tenders of all departments, valuing
between Rs. 2.0 crore and 20 crore in Feb & March-
2016.
It has been decided by Railway Board to implement
e-tendering in all works tenders to be invited w.e.f.
01.04.2016. Any exception to it i.e. adoption of
manual process instead e-tendering will require
prior approval as under-
(a) All tenders of Division – DRM
(b) All tenders of Workshop – CWM
(c) All other tenders of HQs - GM
CAMTECH, Gwalior

Introduction - IREPS
Continue….

Monthly exception report with details of tenders not


invited on IREPS portal through E-Tendering mode
should be sent to Railway Board.
CAMTECH, Gwalior

Basic Requirement for E-tendering

1. PC with internet connection

2. Digital signing certificate

3. Digital Encryption certificate

4. Admin. User login id and password.


CAMTECH, Gwalior

Steps for setting up IREPS


1. Upload Digital Signing Certificate (DSC)
(provided by CRIS)
2. Login by using user-id and Password (provided
by CRIS)- You may change password after login.
CAMTECH, Gwalior

Steps for setting up IREPS

3. Change Digital Signing Certificate (Not required for users


whose account was created by CRIS with their own DSC)

If you have now got your own DSC, please


change the DSC attached with your user profile
immediately.

This can be done through the link available on


the login page as shown below:
CAMTECH, Gwalior
TWO PACKET SYSTEM
(RB letter 94/CEI/CT/04 DATED 17/10/02)
 Can be adopted for Highly Technical works where
parameters not precisely defined or specialized in nature
 Qualifying criteria for selecting the tenderer to be defined
precisely and concurred by FA & CAO and approved by
GM/CAO
(RB letter 2007/CEI/CT/18 DATED 07/03/08)

Railway may follow two packet system for high value tenders
(RB Letter. 2008/CE.1/CT/Con/7(PCE/GM) DT 15.12.08)

• Two-packet system may be adopted without linking it to any


financial value.
 Two packet system shall be resorted to for Techno-Commercial
considerations in works contracts for values communicated by
Board from time to time on the subject.
(RB Letter. 94/CE-1/CT/4 Pt.17 dated 13.08.2012)
CAMTECH, Gwalior
TWO PACKET SYSTEM
(RB Letter. 94/CE-1/CT/4 Pt.17 dated 13.08.2012)

1. For all works contract Tenders requiring Techno-Economic


evaluation “Two Packet System” of tendering shall be the norm as
far as possible.

2. However, for all works contract tenders valuing more than Rs. 10
Crore, “Two Packet System” shall mandatorily be followed, except in
cases where it is decided by an Executive officer not below HAG
level for reasons to be recorded in writing with the concurrence of
FA&CAO, that it would be advantageous to follow “Single Packet
System”.

3. For Tenders valuing up to Rs. 10 Crore, decision to adopt “Two


Packet System” shall be taken by the tender inviting authority with
the concurrence of associate Finance, keeping in view the guiding
principle laid down in item (1) above.
CAMTECH, Gwalior
Two Packet System of Tendering:
 Two packet system may be adopted in identified situations for obtaining
consultancy services for highly technical works where parameters can not be
preciously predefined or for execution of works which are technically
complicated.
 The ―Qualifying Criteria‖ in the tender documents should be defined duly
concurred by FA&CAO & approved by GM.
In this system, the tenderers are advised to submit their offers in two sealed
envelops with one cover containing Technical & Commercial offers and other
containing Financial bid.
1. Technical Bid: The technical conditions are read out before the tenderer and
TC evaluates the same. The tenderer are advised to enclose EMD in the technical
bid.
2. Financial Bid: If technical bid is acceptable, the financial bid is opened and the
tenders processed for acceptance in the normal manner.
 If on the basis of informations of first packet, the TC needs clarification regarding
designs, specs etc., discussion shall be held with each tenderer after obtaining
approval of competent authority (GCC - 7A-3).
CVC Guidelines for tender opening: Not only tender opening officer sign the
envelopes but sign of two tenderers should also be obtained on all the envelopes containing
price bid.
CAMTECH, Gwalior

Tenders received by Post.-


Tenders received by post should be entered in the
Tender Register and the time of receipt should be
recorded on the cover of the tender and deposited
before the closing time in the tender box.
(Engineering code, 1999 Para 1247)
Delayed Tenders
Delayed tenders are those received after due date & time
but before time of opening.
Late Tenders
 Late tenders are those received after due date & time of
opening.
 'Late' & Delayed tenders to be opened by concerned BO
and marked as such in red ink prominently on the
envelope as well as on the tender papers.
CAMTECH, Gwalior

Delayed and Late Tenders cont………


 A suitable remarks in regard to both
Delayed & Late tenders should be made
both in the tender register as well as in the
comparative statement.
(Engineering code, 1999 Para 1251)

 Reconsidered by Board that where late tenders from


established/Reliable suppliers and conferring a
substantial financial advantage is to be considered, not
withstanding general ban, it will be open to the Railways
to seek the Board’s approval for the consideration with
the approval of GM duly concurred in by FA&CAO.
 (RLy Bd. L.No. 71/RS(G)/777 dated 19.04.1984)
CAMTECH, Gwalior
Types of Contracts
Depending on the size of project, local conditions, resources and technology, there are
many types of contracts
Lump sum Contract: The contractor is engaged to carryout a work or effect supply as specified
within a given period for fixed total sum – (Construction of RCC Tank).

Schedule Contract: For works or supply of material at the fixed unit rates. These contracts need a
master schedule of rates.

Piece Work Contract: Only unit rates or the prices for various kinds of works or materials are
agreed upon.

Turn Key Contract: These are “Design – build‖ contracts – Construction of ETP or ROB etc..

Petty Labour Contracts: Contractors use the sub-contracts so as not to increase the staff strength.
Rate Contracts: During the period of its currency, the contractor supplies the material on the
demand at fixed rates.

Running Contract: For certain consumable items, the periodic consumption is known by
experience. In such cases, stores deptt. enters in to the running contracts.

Consultancy Contracts: May be required for advisory services for works requiring highly specialized
technical assistance.
CAMTECH, Gwalior
Estimate:
Kinds of Estimates
1. Abstract Estimates.
2. Detailed Estimates.
3. Supplementary Estimates.
4. Revised Estimates.
5. Project Abstract Estimates.
6. Construction Estimates.
7. Completion Estimates.

An Estimate is a statement prepared to gauge an idea of expenditure to be


incurred on a work in order to obtain sanction of the competent authority and
also to see that the work is financially justified.

 This should be signed by BO and sent to finance for concurrence


 Copy of it as vetted by finance with his note should be submitted to the authority to
sanction the estimate.

Tender Notice (NIT):


After sanction of competent authority, a brief Tender Notice has to be prepared and
sufficient notice should be given for submission of tender.
 In case of large works–It should be 30 days.(Rly. Bd letter No. 2007/CE-
I/CT/18 Pt. II dated 30.07.2010).
 Tender Notice period should never be reduced below 12 days.
 (Rly. Bd letter No. 2015/CE-I/CT/AP/1 dated 19.06.2015).
 It should be given maximum publicity in news papers.
 The tender notice and tender documents should be posted on a website and
the name of website should be given in the tender notice.
CAMTECH, Gwalior

Notice Inviting Tenders (NIT)


To contain –

 Nature & scope of work


 Site location (s) (no abbreviations)
 Approximate value
 Completion period
 EMD amount
 Date/time of start/closing of sale of TD & placing T/Box
 Cost of TD
 Eligibility criteria for tenderers
 Place of sale & submission of TD
 Date, time & place of opening of tenders
 Wabsite particulars etc.

Not to be lengthy and stipulated gap between NIT & TOD


CAMTECH, Gwalior

Tender Document
TOP SHEET
Contract for: House keeping, Caretaking, Catering Facilities to the IRCAMTECH Hostels.

1. Tender Notice No. : IRCAMTECH/GWL/Hostel/Tender/2012-2014 Dated 25.08.2010

2. Approx. Cost/Estimated cost : Rs. 9,31,260/-

3. Period of Contract : Two years

4. Earnest Money (EMD) : Rs. 18,630/-

5. Date & Time of placement of T/ Box : 09.30 hrs. on 05.10.2016 near Main gate

6. Date & Time of Closing Tender : 15:00 Hrs. of 15.10.2016

7. Date & time of Opening of Tender : 15:15 Hrs. of 15.10.2010

8. Index:
Tender document cost: Rs. 2000/-
CAMTECH, Gwalior

Tender Document

Zonal Railways /Production units etc. must ensure


that the Tender Documents including Tender
schedule are invariably checked by the
concerned technical staff in Division/Zonal
headquarter etc. and are approved by
competent authority, before invitation of the
Tenders.
(RLy Bd‘s L. No. 2015/CE-I/CT/1/TS dated 24.08.2015)
CAMTECH, Gwalior
Guidelines for Maintaining Tender Box Register
a. Tender sale of tender document to be continued up to 4 hours of opening of tender.
b. Sealed tenders should be dropped in boxes, before notified date & time.
c. Multiple places for dropping of tenders may be permitted for high value tenders, since it is
applicable for high value tenders only.
d. Tenders received by post to be entered in tender register and the time of receipt should be
recorded on the cover of the tender and deposited before the closing time in the tender box.
[ 1247-E]
e. Test check should be conducted by executives to check whether any working contractor,
Railway employee or any other individual is obstructing or barring any tenderer for dropping
his offer in the tender box.
f. After tenders are put on sale, tender box should be placed at specified place, locked and
sealed with only a top horizontal slot (Large enough to drop the tenders) kept open.

As per Railway Board’s letter No. CE-I/CT/1 dated 13.02.1991, it is desired that boxes should
be provided well in advance and in any case atleast 10 days before the last date of
receipt of the tenders so that tenderers feel free to deposit the tenders at their
convenience.

Tender box once sealed to be opened at specified time and the opening should under
normal circumstances not to be postponed.
[CE/CR‘s L.No. W.187.R.VII OF 31.10.79, Para 10] annex. 56.]

It should be ensured that the sealed tender box not tempered-with and adequate
arrangements for its security are made to avoid complaints from any of the tenderers.
[CE/CR‘s L.No. W.187.R.VII OF 31.10.79, Para 10] annexure 56. & Bd‘s letter dated 13.02.1991 ]
CAMTECH, Gwalior
g. Tender box should indicate by a slip pasted on the box conspicuously, the
name of the work for which the tenders are to be deposited therein and
date & time up to which tenders can be dropped in the box.
h. The key of this lock should be kept in the custody of the Supervisory
official.
i. For high value tenders, arrangements should be made for keeping
tender boxes at 2 to 3 different locations so as to give max. scope for
contractors residing in far off remote areas to submit their offers.
[ Boards letter No. 90/CE-I/CT/I of 28-10-98, annex.26].

The tenderers should be allowed to drop their offers in the tender box
up to 15 minutes prior to the opening of the tenders where after the
boxes may be sealed. This should be indicated in the NIT.
j. The tenderers should be allowed to drop their offers in the tender box
up to the time specified in NIT, where after the boxes may be sealed.
k. At the specified time for closing of tenders, the hole in the box should
be covered by a slip pasted over it under the signature of the
supervisory official holding the key of the tender box and preferably in
the presence of the Section Officer (Accounts).
l. Immediately after sealing of the tender box, the same should be kept in
the chamber of the Gazetted officer nominated for tender opening.
CAMTECH, Gwalior
Tender Box Opening:
m. Tenders to be opened at specified time, date and place by the officer
nominated for this purpose in the presence of the tenderers.

n. Accounts representative to be present during time of opening for all advertised


tenders valuing more than Rs. 10,000. [ Engg. Code para 1248 ].
o. At the time of opening of the tender box, members of Opening Committee and
tenderer’s representatives present at that time should be shown the pasted
slip on the top of the box covering the horizontal slot and also the intact seal
on the lock.
p. Seal should then be broken, lock opened and all the tenders taken out,
counted and empty box seen by the opening committee and to other persons
present.

q. All tenders should be taken out from their envelops, if any, and should be duly
numbered by indicating serial number in the numerator and the total numbers
of tenders received for that particular work in the denominator.
r. Tender Opening register should reflect: Sr. No., opening date, name of work,
tender notice no. & date, name of tenderer, EMD particulars, rates quoted,
nature of tender, nos. of forms sold, nos. of forms received and opened,
signature of tender opening officials ( EO and Accounts representative).
Above guidelines to be followed strictly by concerned staff
CAMTECH, Gwalior

Tender Box Register Proforma (Sample)

1. Name of the work: Tender for providing Transportation facilities in CAMTECH/GWL for a
period of one year i.e. 2016-2017
2. Tender No:, IRCAMTECH.GWL.Hostel.Vehicle.2016-17
3. The date & time of availability of tender box for submission of tender: 08.08.2016 at
.09.30 hrs
4. The last date & time up to which tender box will be available for submission of
tender – 17.08.2016 up to 15.00 hrs.
5. The Name of Security staff: Shri Parmoli (Gunman) for date of opening.
6. The tender Box will be kept in the chamber of Director/Mechanical in safe custody daily
at 17.30 hrs. and will again be kept at main gate near the table of security supervisor at
09.30 hrs. in sealed & locked condition.
Note: The tender box is made available on 08.08.2016, min.10 days before the last date of
receipt of the tenders as per guidelines of Railway Board’s letter No. CE-I/CT/1 dated
13.02.1991.
To be tabulated as under -
1. Sr.No.
2. Date of placement of Tender box at main gate of CAMTECH office.
3. Time of Tender box Placement
4. Time of tender box taken in safe custody by SSE/TENDER
5. Signature of key holding SSE
7. Test check conducted by Executive:
Test check was conducted by Sr DEE on 17.08.2016 at 09.30 hrs.
(Seal of Sr DEE)
CAMTECH, Gwalior
Format for Tender Box Slip (Sample)
Register No.: Tender Box. Reg..IRCAMTECH/GWL.

Date & time of placement of Tender Box: 08.08.2016 at 9.30 hrs.

Name of work- To provide Transportation facilities in CAMTECH/GWL


for a period of one year i.e. 2016-2017.
Tender No.: IRCAMTECH.GWL.Hostel.Vehicle.2016-17.

Estimated cost: Rs. 225060.00.

Earnest Money: Rs. 4510.00.


Last Date & time of submission of Tender – 17.08.2016, 15.00 hrs.
Date & time of Opening the Tender: 17.08.2016, 15.15 hrs.
Place where Tender Box is kept: Main gate near the table of security
staff in Sr DEE’s office.
Sr DEE.
ABC Division
Precautions while Opening Tender:
CAMTECH, Gwalior

 Should be opened by committee in presence of all tenderer..


 Envelopes to be serially numbered like 1/5, 2/5 etc. and initialled.
 They are to be entered in the tender opening register in the same order
with firm name.
 Open envelope & record number appearing on envelope on each page of
offer with initials.
 Better to indicate total no. of pages after careful counting.
 Encircle all rates both figures and words & financial conditions with initials
without leaving any space.
 Testify and indicate corrections and its total on each page.
 Indicate ambiguities in rates by recording rates also in words.
 Record whether sample has been supplied.
 Number of conditions quoted on each page to be counted.
 Name & rates quoted by each tenderer to be read-out loudly.
 No opportunity to tenderer to amend, explain the rate or conditions
 Value and form of EMD to be noted.
 Summary of rates to be prepared
 In case of two packet system – Technical bid be opened first.
 Care should be taken for–Correction in rate, in conditions, additional
offers, taxes etc.
CAMTECH, Gwalior
Verification of Authenticity of Documents of L-1 bidder
Instances have come to notice that Documents/Credentials submitted by
some bidders were found fake/forged. CVC has issued some guidelines
In order to avoid delay in finalization of tenders within their validity
period, following procedure may be adopted –

• Documents of all bidders be sent for verification immediately after opening of technical
bids.
• The processing of tenders may continue without waiting for verification of documents.

• Authenticity of Bank Guaranty issued by banks, may be got ascertained by Fax or


e-mail from the issuing bank.

• Authenticity of Performance/ Experience Certificate may be ascertained by Fax/


e-mail / deputing officer not below the rank of manager.

• It may be ensured by Project Convener that before submission of recommendation by


the Tender committee to the Tender Accepting Authority, report on verification of
Documents / Credentials of L-1 bidder is available.

• The Tender Committee shall make suitable mention regarding verification of


documents in their recommendations to the Tender Accepting Authority.
(Vigilance circular issued for letter no. RITES/RI/MIS/11B dated 11.03.2008).
CAMTECH, Gwalior
Briefing Note & Tabulation Statement
After the tender has been opened, tabulation statement with
briefing note should be prepared. The same should be scrutinized
and signed by the branch officer.
Comparative Statement
To be prepared by tender clerk and signed by not below SS/JAG.
Each page should be signed. In case of tender costing Rs.30Lakhs
and above the technical briefing need to be done only by JAG
officer.
Briefing notes for the Tender Committee —
Alongwith the tabulation statement, a briefing note duly authenticated at
an appropriate level should be submitted clearly.
(Engineering Code, Re- Print 1999, Para 1253)
Scrutiny by the Accounts Department.--The tabulation statement
and the briefing notes shall be sent thereafter for scrutiny together with
the original tenders to the Accounts Officer concerned. The tabulation
statement should be signed by the Section Officer (Accounts)
nominated for the purpose .
(Engineering Code, Re- Print 1999, Para 1254)
CAMTECH, Gwalior
FORMAT OF BRIEFING NOTE FOR TENDERs
Part A: Pre Tender information

1. Name of Work :
2. Directorate/Division :
3. Pink Book/Law Book/LWP Ref. No. for Demand No. 16 :
Reference of sanctioned detailed estimate (DE) & cost of
4. DE :
a. Nature of Tender (Open/Single/Global/Spl. Ltd.)
5. b. Sanctioning authority with respect to nature of Tender :
6. Works / Stores/ Consultancy tender :
7. Two bid (two packet) or single bid :
8. Whether pre-bid meeting required :
9. Pre-bid minutes available/uploaded : :

Cost of tender document has been taken during pre-bid


10. meeting :
CAMTECH, Gwalior
FORMAT OF BRIEFING NOTE FOR TENDERs (Contd…
Part A: Pre Tender information

11. Vetted Indent details/quantity (in case of stores tender) :


In Global Tender, exchange rate on the date of tender
12. opening @ BC selling price from SBI (for two packets :
technical bid opening date)

Master copy of the tender document sealed at tag & signed


13
by Competent Authority placed at SI. No. :
Whether the offered tender document has been compared
14.
with master copy :
15. Approval of NIT taken. :
Tender Notice No. & date (also specify date of publication,
16.
if different) :
Whether complete bid documents published on website
17.
or not and date of publication. :
CAMTECH, Gwalior
FORMAT OF BRIEFING NOTE FOR TENDERs (Contd…
Part A: Pre Tender information

1. In case of open/global tenders, News paper


cuttings alongwith the dates (atleast 03)
including other document on mode of
advertisement (such as displaying on Notice
Board, Notifications).
2. In case of Limited Tender-list of approved firms.
18.
-Whether short listed firms have been duly
:
approved by CA.
- Whether a minimum criterion is fulfilled.
3. In case of Spl. Ltd. Tender-Basis of short listed
firms.
- Whether minimum criteria is fulfilled.
Whether tender notice period has been
19.
shortened.( Approval of competent authority) :
20. Approx. cost of works as per tender notice. :
21. Date of tender opening :
(Prepared/Checked by) (Approved by) (Vetted by)
CAMTECH, Gwalior
FORMAT OF BRIEFING NOTE FOR TENDERs (Contd…
Part B: Post Tender information

1. No. of Tender forms sold. :


2. No. of offers received :
3. No. of Late Tenders/Delayed Tender :
4. Tenders opened by :
5. Rate Tabulation Chart placed at (single bid) :
6. Validity of offer :
7. level of TC :
8. Accepting Authority :
Whether tender documents and terms &
9. conditions signed by Tenderer or not :
(Details)

(Prepared/Checked by) (Approved by) (Vetted by)


CAMTECH, Gwalior
FORMAT OF BRIEFING NOTE FOR TENDERs (Contd…
Part B: Post Tender information
Partnership deed, Power of Attorney, Sole
10.
Partnership Certificate submitted or not (Details) :
11. Completion period/Delivery period :
12. Samples if required are submitted/not submitted :
lowest offer vis-a-vis estimated cost (% age
13.
variation) :
14. lowest offer vis-a-vis LAR (% age variation) :
15. Allocation (chargeable head) :
Funds availability (copy of Fund availability),
16.
available in current financial year. :
From the participating firms whether business has
17.
been banned with any firm, :
(Prepared/Checked by) (Approved by) (Vetted by)
FORMAT OF BRIEFING NOTE FOR TENDERs (Contd…
CAMTECH, Gwalior
Part B: Post Tender information

18. Tender Document Cost:

S Amt. of tender Mode No. & Date Issuing Exemption Walval, Validity, Whethe Remarks
N document of EM of bank & s, if any if any if any r cross
deposited (BG’s instrument whether indicatin checke
are s is a g last d with
not schedule date of issuing
valid) d bank. validity Bank
FORMAT OF BRIEFING NOTE FOR TENDERs (Contd…
CAMTECH, Gwalior
Part B: Post Tender information

19. Earnest Money:

S Name of Amt. of Mode No. & Dale Issuing bank Exempt Waival, Validity, Wheth Remarks
N Tenderer EM of of & ions if if any er
deposited EM instruments branch & ,if any any indicating cross
(BG's whether is a last check
are not scheduled date of ed
valid) bank. validity with
Issuin
g
Bank

-
CAMTECH, Gwalior
FORMAT OF BRIEFING NOTE FOR TENDERs (Contd…
Part B: Post Tender information

20. Credentials of Tenderers

Documents submitted to prove Documents submitted to prove


S.N Name of Tenderer
Technical Credentials Financial Credentials

(Prepared/Checked by) (Approved by) (Vetted by)


FORMAT OF BRIEFING NOTE FOR TENDERs (Contd…
CAMTECH, Gwalior
Part B: Post Tender information

Part C: Special Features if any


1. Special conditions, if any
2. Other details
3. Any special remarks
4. Deviation from tender condition
i.
ii.
iii.
iv.

(Prepared/Checked by) (Approved by) (Vetted by)


Note: CAMTECH, Gwalior

1. Each page of Briefing Note should be signed.


2. Due care may be taken to fill-up all the Columns
provided in briefing note related to tender case. Column
not relevant / not applicable may be indicated as such.
3. The approving/forwarding authority of the executive has
to be of gazetted level.
4. The vetting in Accounts office to be at least Jr. Scale
level i.e. gazetted.
5. Responsibility of facts lies with the official
preparing/checking the briefing note. Accounts
Department is responsible for verifying the
facts/calculations/figures.
CAMTECH, Gwalior
Earnest Money Deposit (EMD)

Every tenderer is required to deposit EMD for due fulfillment


of the conditions of the contract ( to be a security
against loss in case of failure of contractor) (Para 1241 &
1242). The earnest money is required to test earnestness of
the tenderer and to discourage non serious parties. The EMD
of the successful tenderers is adjusted in the Security Deposit
(SD).
Value of Work EMD
For works estimated to cost up to 2% of the estimated cost of the work.
Rs. 1 Crore
For works estimated to cost more Rs. 2 Lakhs + ½ % of the excess of
than Rs. 1 Crore estimated cost of work beyond Rs. 1 Crore
EMD Maximum Limit : 01 crore

• EMD shall be applicable for all modes of Tendering.


• The tenders without EMD are liable to be rejected.
• EMD should be in cash or can be remitted in the following forms –
FDR (Fixed Deposit receipts)/Banker‟s cheques/DD in favour of FA & CAO of
Railway, executed by SBI or any Nationalized Bank/Sch.Bank.
• shall be rounded to the nearest Rs. 10/-
CAMTECH, Gwalior

EMD
The Earnest Money of the unsuccessful tenderer(s) will,
save as here-in-before provided, be returned to the
unsuccessful tender(s) within a reasonable time but the
Railway shall not be responsible for any loss or
depreciation that may happen to the Security for the due
performance of the stipulation to keep the offer open for
the period specified in the tender documents or to the
Earnest Money while in their possession nor be liable to
pay interest thereon.
(GCC-2014 Annexure 1 Second Sheet, Item No. 6d )

If the tenderer(s) expires after the submission of his / their


tender or after the acceptance of his/their tender, the
Railway shall deem such tender cancelled.
(GCC-2014 Annexure 1 Second Sheet, Item No. 9 )
CAMTECH, Gwalior

The full value of the Earnest Money shall stand


forfeited without prejudice to any other right or remedies
in case my/our Tender is accepted and if:-

a) I/We do not execute the contract documents within 7


days after receipt of notice issued by the Railway that
such documents are ready; and

b) I/We do not commence the work within 15 days after


receipt of orders to that effect.
(GCC-2014 Annexure 1 First Sheet, Item No. 3 )

Refund of Earnest Money (EMD).- The Earnest Money


of all unsuccessful tenderers should be refunded as
expeditiously as possible.
(Engg. Code, Re- Print 1999, Para 1261).
CAMTECH, Gwalior

Returning of EMD:
[ Rly Board‘s letter No 2007/CE-I/CT/18(Pt.I) dated 10.09.2008 ]

1. In single packet system of tendering, the EMD submitted


by all the tenderers except L-1, may be released after
acceptance of offer of L-1.
2. In case of Negotiations proposed to be held, the EMD
submitted by all the tenderers other than the tenderer
with whom negotiation has been proposed, may be
released after acceptance of TC recommendations by
the accepting authority.

3. In two packet system of Tendering, the EMD of tenderers


not found technically suitable for opening of Price bid,
may be released after acceptance of TC
recommendations by accepting authority.
CAMTECH, Gwalior

The EMD for advertised tenders

2% of the estimated tender value subject


to on upper limit of –

a. 5 lakhs of tender valuing upto Rs 10


crores.
b. 10 lakhs for tender valuing above Rs
10 crores.
CAMTECH, Gwalior

The SD for advertised tenders

10% of total contract value subject to on


upper ceiling limit of –

a. 10 lakhs for contract valuing upto Rs


10 crores.
b. 20 lakhs for contract valuing above Rs
10 crores.
CAMTECH, Gwalior
Security Deposit (SD):
(GCC 2014 DEFINITIONS AND INTERPRETATION , Item No.16.(1)
The security deposit is for the due fulfillment of
contractual obligations of tender. The SD to be recovered
from the tenderer shall be 5% of the contract value.
Balance SD shall be recovered from the bills @10% of each bill
amount.
Refunding of SD: 1. Based on the completion report SD has to
be refunded with the approval of competent authority.
2. Refund of SD is the last act in any contract. Returned after
expiry of Maintenance period
3. SD refund should be linked with the performance for the work.
After getting no claim certificate
CAMTECH, Gwalior
Performance Guarantee:
(GCC 2014 DEFINITIONS AND INTERPRETATION , Item No.16.(4) d
It has been introduced in lieu of Risk action procedure.
 The successful bidder shall submit PG in any of the following forms
amounting to 5% of the contract value.
 Deposit of cash, Bank Guarantee, loan Bonds, Pay order, DD, Guarantee
Bond, Post Office, NSC, NDC, ten years defence deposit, Unit Trust Certificate,
FDR.
 The successful bidder shall have to submit PG within 30 days from the date of
issue of letter of acceptance (LOA).
 Extension of time for submitting PG beyond 30 days and up to 60 days from
LOA, may be given by officer who is competent to sign the “Contract
Agreement”.
 Quantity variation up to 25% - No change in PG.
 Increasing by more than 25% – additional PG amounting to 5% for excess
value over the original contract value shall be deposited by contractor.
 Decreasing by more than 25% –PG amounting to 5% of the decrease contract
value shall be returned to the contractor. (BD‟s L.No. 2016/CE-1/CT/1/PG dt.27.06.2016)
 PG shall be released based on the “completion certificate” after passing
final bill.
CAMTECH, Gwalior
COMMENCEMENT OF WORK
& LIQUIDATED DAMAGES
 The time for the execution of the work or part of the
works specified in the contract documents shall be
deemed to be the essence of the contract.
 If the contractor fails to complete the works within the
time as specified in the contract for the reasons other
than the reasons specified in clause 17 and 17-A of GCC,
the Railway may, if satisfied that the works can be
completed by the contractor within a reasonable short
time thereafter, allow the contractors further
extension of time as the Engineer may decide.
 On such extension the Railway will be entitled without
prejudice to any other right and remedy available on that
behalf, to recover from the contractor as agreed damages
and not by way of penalty a sum equivalent to ½ of 1%
of the contract value of the works for each week or part
of the week.
((GCC-Clause 19.2) Engineering Code, Re- Print 1999, Para 1267)
CAMTECH, Gwalior

Site Registers
For successful execution of the work and to
deal with arbitration cases effectively,
following registers should be maintained.
1. Site Order Book – This is covered by para 1122 &
1123. This is the basic record and should be bound
and numbered.
2. Programme Register- Full particulars i.e.
manpower, machinery, plants deployed and day to
day programme are recorded.
3. Payment Register –Contains the details of payment
and various recoveries made from contractor..
CAMTECH, Gwalior

Recording of Measurements
1. Measurement are to be recorded in MBs.
2. Prescribed checks on measurement should be conducted by officers.
3. Payment at full rates must not be made unless the item has been
completed as per specs.
(Bd’s letter No. 94/CE-I/CT/4 dated 17.09.1997)

Upkeep of Measurement Books:


1. The pages should be machine numbered.
2. The entries must be made clearly in MB books at site of the work .
3. Each measurement book should be provided with an index-1325.
4. All quantities should be clearly traceable in to the documents.

Completion Reports:- Para-1706


Completion Report should be prepared in the form of E-1706 and
brief explanation should also be furnished.
CAMTECH, Gwalior
IMPORTANT CLARIFICATIONS at a glance
Signing of Agreement & Submission of PG
 Tenderer shall have to submit a PG within 30 days from
date of issue of LOA.
 Extension of time beyond 30 days and up to 60 days from
issue of LOA may be given by CA signing authority with a
penal interest of 15% per annum for the delay beyond 30
days after issue of LOA.
 In case of the contractor fails to submit PG even after 60
days, the contract shall be terminated forfeiting EMD.
 The failed contractor shall be debarred from participating
in “re–tender for that work”.
(GCC-2014, 16(4), Rly. Bd. Letter No. 2007/CE. I/CT/18 Pt. XII Dated 31.12.2010)

 The SD shall be forfeited if contractor fails to execute agreement bond


within 7 days after receipt of notice or to commence the work within
15 days after receipt of order.
(GCC 2014, Annexure I, Second Sheet , Item No.6(c))
CAMTECH, Gwalior
IMPORTANT CLARIFICATIONS at a glance

Form of Contract agreement


Not less than 2 copies of the contract document shall be signed by the
competent authority and the contractor and one copy given to the
contractor.
(GCC 2014 Meaning of terms, Item No. 9)
 The contract document shall be signed in triplicate by Railway and
Contractor.(GCC-2014 -Part – II [ 2(1) ]

(a) For zone contracts on the basis of % above or below the


schedule of rates should be as per specimen form Annexure II
for works not exceeding Rs. 2 lakhs each.
(b) For Contracts valued more than 2 lakhs, the Contract document
to be executed in Annexure IV or V.
(GCC 2014 Meaning of terms, Item No. 9)
CAMTECH, Gwalior
Employment of retired Railway employee/ Officer

Retired 01 Year prior to the date of submission of tender.


(GCC-2014 Annexure 1 Second Sheet, Item No. 59(10) &17 )

Railway passes

No free Railway passes shall be issued to the tenderer or his employee.


(GCC-2014 Part II, Definition and Interpretation, Item No. 9)

Security deposit (SD)

The EMD deposited by contractor with his tender will be retained as


SD – 5% of contract value.
The rate of recovery should be 10% of the bill amount till recovery.

SD shall be returned after expiry of maintenance period.

(GCC-2014 Annexure 1 Second Sheet, Item No. 16(1) )


CAMTECH, Gwalior

Execution of contract documents.


A duly authorized representative shall so appear
and execute the contract documents within 7 days
after notice that the contract has been awarded to
him.
(GCC 2014 Meaning of terms, Item No. 8)

Communications to be in writing:-
All notices, communications, references and
complaints made by the Railway or the Engineer
or the Engineer's Representative or the Contractor
inter-se concerning the works shall be in writing.
(GCC 2014 Part-II, Item No.4)
CAMTECH, Gwalior

Occupation and use of land:-


No land belonging to or in the possession of the Railway
shall be occupied by the Contractor without the permission
of the Railway. The Contractor shall not use, or allow to be
used, the site for any purposes other than that of executing
the works. Whenever non-railway bodies/persons are
permitted to use railway premises with competent authority’s
approval, conservancy charges as applicable from time to
time may be levied.
(GCC 2014 DEFINITIONS AND INTERPRETATION , Item No 6)

Carriage of materials:-
No forwarding orders shall be issued by the railway for the
conveyance of Contractor's materials, tools and plant.
(GCC 2014 DEFINITIONS AND INTERPRETATION , Item No 10)
CAMTECH, Gwalior

Representation on Works:-
The Contractor shall, when he is not personally present on
the site of the works place and keep a responsible agent at
the works during working hours.
(GCC 2014 DEFINITIONS AND INTERPRETATION , Item No 12)

Document to be submitted along with the tender as


credential:
List of personnel and organization
 List of Machinery & Plants

 List of works completed in last three years

 List of works on hand


(Rly. Bd. Letter no. 94/ CE-1 /CT/ 4 dated 17.10.02)
CAMTECH, Gwalior
IMPORTANT CLARIFICATIONS at a glance (contd…)
Before releasing SD

“No claim certificate” must be obtained from contractor


Performance Guarantee (PG) :
(GCC 2014 DEFINITIONS AND INTERPRETATION , Item No 16 (4))
1. The successful bidder shall have to submit a PG within 30 days from
the date of issue of LOA. Extension of time for submission of PG
beyond 30 days and up to 60 days from the date of issue of LOA
may be given by the authority who is competent to sign the contract
agreement. The successful bidder may give PG to 5% of contract
value (cash, BG, Loan Bonds, post office, saving bank FDR etc.).
2. The PG shall be submitted by the contractor after LOA has been
issued but before signing the contract agreement. This PG shall be
initially valid up to date of completion + 60 days beyond that.
PG shall be released after physical completion of work based on
the “Completion certificate” issued by competent authority.
CAMTECH, Gwalior
IMPORTANT CLARIFICATIONS at a glance (contd…)
Delay in execution due to Contractor:
If contractor fails to complete the work within time, extension is granted with LD.
On such extension, Railway will recover ½ of 1% of the contract value of the work
for each week or part of the week. LD should not exceed the under noted
percentage value of contract or of the total value of item:

For contract value upto 2 lakhs : 10% of the total value of contract.

For contract value above Rs. 2 lakhs: 10% up to 2 lakhs and 5% of


the balance amount.
While granting extension, may also consider levy of token penalty
(GCC 2014 DEFINITIONS AND INTERPRETATION , Item No 17-B)
Commencement of works
The contractor shall commence the works within ……. days after receipt
an order (LOA).
Provision of efficient and competent staff
The contractor shall place and keep on the work efficient
and competent staff. (Rly. Board Letter No. 2012/CE-I/CT/0/20 dated 10/05/2013)
1. The Contractor shall also employ qualified graduate engineer or diploma
engineer.
2. In case contractor fails to provide engineer, he shall be liable to pay penalty.
Water supply to contractor
Charges to be collected from Contractor.
CAMTECH, Gwalior

Illegal Gratification:-
Any bribe, commission, gift or advantage given, promised or
offered by or on behalf to the Contractor or his partner,
agent or servant or, anyone on his behalf, to any officer or
employee of the Railway, or to any person on his behalf in
relation to obtaining or execution of this or any other contract
with the Railway shall, in addition to any criminal liability
(GCC 2014 DEFINITIONS AND INTERPRETATION , Item No 18.(1)

The Contractor shall not lend or borrow from or have or


enter into any monetory dealings or transactions either
directly or indirectly with any employee of the Railway and if
he shall do so, the Railway shall be entitled forthwith to
rescind the contract
(GCC 2014 DEFINITIONS AND INTERPRETATION , Item No 18.(2)
CAMTECH, Gwalior
IMPORTANT CLARIFICATIONS at a glance (contd…)

Electric supply to contractor


Contractor shall obtain electric power from Railway on charge basis.
(GCC 2014, Execution of work , Item No 31(4a))
Manner of payment
Is done by cheque or Electronic, but no cheque is issued for amount less
than Rs. 100/-
Non employment of labours below 15 years
Not employed below 15 years.

Medical certificate of fitness


Shall not employ above 15 years but below 19 years for works without
taking medical certificate of fitness for 1 year.
(GCC-2014, Labour, Para 60(2))
CAMTECH, Gwalior
IMPORTANT CLARIFICATIONS at a glance (contd…)

Cost of Tender Forms

Upto Rs. 5 lakhs - Rs. 1000/-


Above Rs. 5 lakhs to 20 lakh - Rs. 2000/-
Above Rs. 20 lakhs to 50 lakh - Rs. 3000/-
Above Rs. 50 lakhs to 2 Crore - Rs. 5000/ -
Above Rs. 2 Crore to 50 crore - Rs. 10000/ -
Above Rs. 50 crore - Rs. 25000/-
(Engg. Code-1999 Para 1240 -A )
a. If any plan/drawing is attached with the tender forms,
Rs. 200/- per drawing will be levied.

a. If any Tender forms to be sent by post, additional


charges at the rate of Rs. 500/- per tender form will be
charged.
( Bd. Letter No. 2002/CE-I/CT/5 dated 29.07.2002)
CAMTECH, Gwalior
EXECUTION OF WORKS
Commencement of works:-
The Contractor shall commence the works within 15 days
after the receipt by him of an order in writing to this effect
from the Engineer and shall proceed with the same with
due expedition and without delay
(GCC 2014, Execution of work , Item No 19.(2)

LOA (Letter of Acceptance):-


Railways should not delay issuance of LOA after
finalisation of tenders
(RLy Bd. Letter No. 2015/CE-I/CT/AP/1 dated 19.06.2015)
If accepted rates has been restricted for future reference by
TC Committee, it should be mentioned in LOA & Contract
agreement.
(RLy Bds L. No.-2012/CE-I/CT/0/1 dt. 20.0.8.2013 )

Legally LOA and Contract agreement should be vetted by


finance. In WRLy, agreements of value less than Rs.40
lakhs are not vetted.
CAMTECH, Gwalior
EXECUTION OF WORKS

Accepted programme of work:-


The Contractor who has been awarded the work
shall as soon as possible but not later than 30
days after the date of receipt of the acceptance
letter in respect of contracts with initial completion
period of 02 years or less or not later than 90 days
for other contracts have to submit the detailed
programme of work indicating the time schedule of
various items of works in the form of Bar
Chart/PERT/CPM. He shall also submit the details
of organisation (in terms of labour and supervisors)
plant and machinery.
(GCC 2014, Execution of work , Item No 19.(3)
CAMTECH, Gwalior
Working during night:-
The Contractor shall not carry out any work between sun-
set and sun-rise without the previous permission of the
Engineer.
(GCC 2014, Execution of work , Item No 23)
Damage to Railway property or private life and
property:- The Contractor shall be responsible for all risk
to the work and for trespass and shall make good at his on
expense.
(GCC 2014, Execution of work , Item No 24)

Sheds, Stores houses and Yards:-


The Contractor shall at his own expense provide
himself with sheds, store-houses and yards in
such situations and in such numbers as in the
opinion of the Engineer is requisite for carrying on
the works
(GCC 2014, Execution of work , Item No 25)
CAMTECH, Gwalior

Provision of efficient and competent staff:-


The Contractor shall place and keep on the works at all times
efficient and competent staff to give the necessary directions
to his workmen and to see that they execute their work in
sound and proper manner and shall employ only such
supervisors, workmen and labours in or about the execution
of any of these works as are careful and skilled in the various
trades and callings.
Contractor shall submit a correct return showing the names
of all staff and workmen employed by him. In the event of the
Engineer being of the opinion that the Contractor is not
employing on the works a sufficient number of staff and
workmen.
(GCC 2014, Execution of work , Item No 26)
Facilities for Inspection:-
The Contractor shall afford the Engineer and the Engineer's
Representative every facility for entering in and upon every
portion of the work at all hours for the purpose of inspection
(GCC 2014, Execution of work , Item No 28)
CAMTECH, Gwalior
Examination of work before covering up:-
The Contractor shall give 7 days notice to the Engineer or the
Engineer's Representative whenever any work or materials are
intended to be covered-up in the earth, in bodies or walls.
(GCC 2014, Execution of work , Item No 29)
Use of Explosives:-
Explosives shall not be used on the works or on the site by the
Contractor without the permission of the Engineer and then only in the
manner and to the extent to which such permission is given.
(GCC 2014, Execution of work , Item No 35)
Handing over of works:-
The Contractor shall be bound to hand over the works executed under
the contract to the Railway, complete in all respects to the satisfaction
of the Engineer.
(GCC 2014, Execution of work , Item No 40 (1))
Clearance of site on completion:-
On completion of the works, the Contractor shall clear away and
remove from the site all constructional plant, surplus materials, rubbish
and temporary works of every kind and leave the whole of the site and
works clean
(GCC 2014, Execution of work , Item No 40 (2))
CAMTECH, Gwalior
IMPORTANT CLARIFICATIONS at a glance (contd…)
Conditions of Contract
Type of conditions – The conditions are of two types.
A. General Conditions of Contract (GCC) – These are the basic
conditions of contract. There are 65 clauses provided in the GCC.
B. Special conditions of contract (SCC) – These are peculiar to the
particular items of work of the contract. These stipulates date of
completion, maintenance period, guarantee/ warrantee, price variation
clause, variation in quantity, method of measurement etc. The SCCs
are framed by experienced engineers..
Eligibility Criteria:
[ Rly. Bd Letter No. 2007/ CE-I/ CT/ 18/ PL XII DATED 31.12.2010 ]

1. Should have completed similar work in one contract for minimum value of
35% of the advertised tender value in proceeding 3 years (current year + 3
previous years.
This criteria would apply only to tenders of value more than Rs. 50 lacks.
2. Total contract amount received by contractor during last 3 years & current
financial year should be a minimum of 150% of advertised tender value.
Note: However, the above eligibility criteria may be modified on case to case
basis in respect of urgent process / works and specilised nature of works
with FA&CAOs concurrence and personal approval of GM.
CAMTECH, Gwalior
 Eligibility Criteria: (GCC - 2014 Item No. 10)
i. The tenderer shall be eligible only if he
fulfill eligibility criteria of having received
total contract amount during the last
three financial years and in the current
financial year with a minimum of 150% of
the advertised tender value.
ii. Authentic certificates shall be produced
by the tenderer to this effect which may
be attested certificate from the employer
or balance sheet duly certified by CA.
CAMTECH, Gwalior
From whom Certificate can be considered
Organizations other than ‗Private individuals‘ from
whom certificate can be considered -

1. Govt. department/PSU/Co-operative/Institutions.
2. Public Ltd. Company
3. Private Ltd. company.
4. Partnership firms
5. Sole proprietary firms- Registered
( WRLy Letter No. W/623/2344 dt. 13.12.2011)

Minimum Eligibility Criteria:


May be dispensed-with, in case of tenderers who are either OEMs or
Sources approved by RDSO for related works for Repairs/ Rehabilitation/ Up
gradation/ Modification of Locos, Coaches and other Rolling Stocks.
(Bd. Letter No. 2011/M/M&P/7/2/Guidelines dt. 23.08.2012)
CAMTECH, Gwalior
IMPORTANT CLARIFICATIONS at a glance (contd…)

Estimates

• No work should be commenced until detailed


estimate is sanctioned & funds are available.
• Splitting of large work in to small works should be
avoided
(Board letter No. 2004/ dated 21.06.2004)

Vetting of tender schedule by associated Finance is


necessary.
(Board letter No. 2008/ CE-I/ CT/Con/ 7 dated 15.12.2008)
CAMTECH, Gwalior
Variation in quantities (GCC-42(4)3
(a) Operation of an item by more than 125% of the agreement quantity
needs approval of an officer not less than SA grade without
finance concurrence

1. In excess of 125% but upto 140% of the quantity shall be paid at


98% of the rate awarded
2. In excess of 140% but upto 150% of the quantity shall be paid at
96% of the rate awarded
3. Variation of individual item beyond 150% shall be prohibited and be
permitted only in unavoidable circumstances with the concurrence of
finance and be paid at 96% of the rates awarded .
b) The variation in quantities as per the above formula will apply only to
the individual items of the contract and not on the overall contract
value.
c) Execution of quantity beyond 150% of the overall agreemental value
should not be permitted, if found necessary, should be only through
fresh tenders or by negotiating with existing contractor with
concurrence of FA&CAO and approval of General Manager.
CAMTECH, Gwalior
GCC-2014- 42 (4) variation in quantity
3. In case where decrease is involved during execution –
(a) Contract signing authority can decrease upto 25% of individual
item without concurrence.
(b) for decrease beyond 25% for individual items or 25% of contract
agreement value, the approval of SA grade officer may be taken
after obtaining “No claim certificate” from contractor, with
finance concurrence.
4. The limit of varying quantities for minor value items shall be
100% (as against 25% for other items). Minor value of item is
less then 1% of total contract agreement value.
Note: Subsidiary agreement to be signed after each variation, extension in
completion period etc. However a supplementary agreement to
original agreement should be drawn subsequent to sanction of
variation by an officer not below SAG, which needs to be vetted by
finance. (BD’s L.No. 2007/CE-1/CT/18/Pt.XII dated 08.07.2016)
GCC-2014 Part II (Clause 64(1)) CAMTECH, Gwalior

Arbitration
 Demand for Arbitration: In the event of any
dispute or difference between the parties
hereto as to the construction or operation of
this contract, or the respective rights and
liabilities of the parties on any matter in
question, dispute or difference on any account
or as to the withholding by the Railway of any
certificate to which the contractor may claim
to be entitled to, or if the Railway fails to
make a decision within 120 days, then and in
any such case, but except in any of the
„excepted matters‟ referred to in clause 63 of
GCC, the contractor, after 120 days but within
180 days of his presenting his final claim on
disputed matters, shall demand in writing that
the dispute or difference be referred to
arbitration.
CAMTECH, Gwalior

Price Variation Clause (PVC)


GCC- 2014 (46 A)
 1. Price variation clause shall be applicable only for
tenders of value Rs. 50 Lakhs and more, irrespective of
the contract completion period. Variation in quantities
shall not be taken in to account for applicability of
PVC.
 2. SA grade officer of executive department may
decide that PVC shall not apply to Contract even if
the contract value works out to be Rs. 50 Lakhs or
more.
 And
 Shall apply even if the contract value is less than 50
lakhs with concurrence of Finance before NIT.
CAMTECH, Gwalior

Price Variation Clause (PVC)


GCC- 2014 (46 A)
 The Price Variation Clause (PVC) of General
Condition of Contract (GCC) shall not apply to such
a works contract which is either an Annual
Maintenance Contract (AMC) or a Zonal contract
(AMC) or a Zonal Contract”.

A Clause in this effect shall be included in Special


Conditions of Contract, wherever applicable.

{Authority: Railway Board letter No. 2013/CE-


I/CT/o/10/PVC/Pt.I dated 27.01.2015}
CAMTECH, Gwalior
COMPOSITION OF TENDER COMMITTEE (WORKS CONTRACTS) OPEN LINE

S.N. Estimated Value of Composition of Tender Committee Tender accepting


tenders authority
1 Tender Costing over Rs. a) Sr. Scale Officer of the concerned Executive SG/JAG Officer
10,000/-and up to Rs. 20 Deptt. (Convener)
lakhs b) Jr.Scale Officer from accounts Deptt.
2 Tender Costing over Rs.20 a) Sr.Scale Officer of the concerned Executive SG/JAG Officer
lakh and up to Rs. 40 lakh Deptt. (Convener)
b) Sr.Scale Officer of any other Executive Deptt.
c) Jr. Scale officer from Account Deptt.
3 Tender Costing over Rs. 40 a) Sr.Scale Officer of the concerned Executive SG/JAG Officer
lakhs and up to Rs. 2 Deptt. (Convener)
Crores b) Sr.Scale Officer of any other Executive Deptt.
c) Sr. Scale officer from Account Deptt.
4 Tender Costing over Rs. 2 a) SG/JA Officer of the concerned Executive SAG/DRM/ADRM
Crores and up to Rs. 5 Deptt. (Convener)
Crores b) SG/JA Officer of any other Executive Deptt.
c) SG/JA officer from Account Deptt.
5 Tender Costing over Rs. 5 a) SAG Officer of the concerned Executive PHOD/CHOD
Crores and up to Rs. 50 Deptt. (Convener)
Crores b) SAG Officer of any other Executive Deptt.
c) SAG officer from Account Deptt.
Level of the Tender Committee and acceptance CAMTECH,
authorityGwalior
for
Works Tenders
(Bds L. No. 2007/CE-I/CT/O/20/1 dated 08.10.2015)

S.N. Value of Tender Level of Level of TC Remarks


Accepting
Authority
1. Upto 4.0 Crores SG/JAG SS -
2. Above 4.0 Crores &
upto 20 Crores
SAG/DRM/ JAG/SG -
ADRM/CWM

3. Above 20 Crores &


upto 75 Crores
CHOD in SA SAG -
Grade

4. Above 20 Crores &


upto 100 Crores
AGM/PHOD CHOD -
in HAG

5. Above 20 Crores &


upto 300 Crores
CAO/Const. PHOD -
CAMTECH, Gwalior
Note:-

• The level of tender committee is decided based on the estimated


value of the tender or the lowest value of the offers received,
which ever is more

• In case of Single Tenders the tender committee shall be


constituted at a level one stage higher than one constituted
for Open and limited tender in terms of Board‟s letter No.
94/CE-1/CT/4 dated 17.9.97.

• In case of non-availability of an officer in particulars Grade, the


higher Grade Officer can sit in the Tender Committee.

• In case of Tenders beyond the powers of acceptance delegated


to GM. The Tender committee shall be constituted at the level of
PHODs and such tenders should be sent to Railway board
through GM
CAMTECH, Gwalior
Tender Committee
(Rly Bd Vigilance Bulletins Issued in 2002 item No. 20)

Tender committee members’ role is

 To safeguard financial interest of the Railways & ensure


selection of correct agency for execution of the work
 Adhere to the Guidelines/directives received from
Vigilance directorate / Railway Board.
 Provisions of Indian Contract Act are complied-with and
procedure is followed.
 Indian Railway Standard Conditions of contract, Special
conditions of contract, Labour laws, Insurance act,
Central Excise, Sales Tax, Work contract tax,
transportation act, arbitration act etc are not violated.
CAMTECH, Gwalior
Role of TC Members

• He has full knowledge of work to be executed.


• All special features.
• Site conditions.
• Specifications of work.
• Credentials of the tenderer, time frame, urgency etc.
• Market survey of rate analysis.
• Implication of special conditions

Role of Third Member

• He must ensure that rules are followed in general.


• Reasonableness of rates has been properly examined.
• Uniform and consistence approach has been adopted in
dealing.
• On cases of difference of opinion between TC members, he
gives his definite opinion.
CAMTECH, Gwalior
TC constitution and TAA (open/Ltd/spl-Ltd)

 TC member can’t be TAA (to be of higher grade)

 In case of single tender TC and TAA shall be one


step above that for open/limited tender.

 If respective grade TAA is not available, tender


may be accepted by next higher Authority.
CAMTECH, Gwalior
Tender committee
(RB letter No. 2004/C-1/CVC1/18/ dt 12.01.06)
 TC members should give an undertaking at the appropriate
time, that none of them has any personal interest in the
companies / agencies participating in tender process and
that any member having interest in any company should be
refrained from participating in TC.

(RB letter No 94/C-1/CT/4(Pt ii) dt19.11.05)


 Financial capacity, capability and past performance of
tenderer / contractor should be investigated / examined in
detail by TC before recommending for awarding a contract
duly considering existing work load with the tenderer (s).
CAMTECH, Gwalior

Tender Committee
• Tender committee to be constituted as per SOP.
• All the members are collectively responsible for given
recommendations.
• Eligibility criteria of tenderers have to be examined in
detail.
• The Tender committee minutes should be self contained
and self explanatory .
• Rate reasonability of individual item to be examined.
• TCM to be finalised within validity of tender.
• No TC member to be related with any of the tenderer.
• Each page of TCM to be signed with date.
Consistency? 102
CAMTECH, Gwalior
Tender Committee
 TC to verify that -
• Similar work definition as approved by PHOD was
included in NIT.
• There was clear 30 days gap between NIT and
TOD.
• Escalation to be based on relevant and established
index.
• Don’t sign TCM in haste.
• Get the TDs downloaded from INTERNET & verified
• Invitation of tender was approved by CA.
• Tender conditions are latest.
• Offer has been signed by authorised representative
(power of attorney)
CAMTECH, Gwalior

Tender Committee
• Members to check their nominations.
• TC to meet on pre-fixed date & venue and decision be
recorded.
• Check and ensure that:
• Work is appearing in current PB/LB
• L-1 value not exceeding sanction limit
• Funds are available.
• Credentials have been verified
• Each offer has been gone through
• Tender file contains all referred LARs/letters, published
NIT with date.
• Tender was posted on Internet.
• EMD of correct amount and in valid form. 104
CAMTECH, Gwalior

Tender Committee
• Check and ensure that: contd-----
• Special conditions have been evaluated financially
• No banned LARs taken into account
• Avg of 3-4 current LARs taken for comparison
• ABC analysis of rates (Overall rate reasonability not
adequate)
• Delay in tender finalisation to be explained
• Rate analysis to be critically seen.
• Offers from 2-3 firms controlled by same person
• Declaration from L-1 before negotiation.
• Critical evaluation of Non-schedule items.
• Segregation of major groups of Tender schedule.
105
CAMTECH, Gwalior

Consideration of tender

 In case Tenderer does not quote above /


below %, above will be considered.

 If quoted rate in words and figures are not


tallying , decision shall be taken by TC.
(CVO(E)/GRC’s letter no GM/V/system improvement/45 dt 29.11.02)
CAMTECH, Gwalior
Proforma for TC Minutes
1. Heading of Work:
Venue & Date
2. TC Members
Name
Nomination particulars
Declaration
3. General Information:
a. Work: Name, Estimated value, Completion period etc.
b. Estimate:
Original estimate
Sanctioning Authority
Item of Current PB/LB
CAMTECH, Gwalior
Proforma for TC Minutes
c. Outlay, fund allocation
d. Tender invitation
e. Tender opening
4. Credentials of Rates
-Eligible
-Verification
-Past performance
-Work in hand
5. Reasonability of Rates
Over all
Averaging of 3 LAR
RBI index
Scrutiny of Rates
CAMTECH, Gwalior
Proforma for TC Minutes
6. Recommendations
Dissent note if any
Recommendation para
7. Remarks about delay in finalization if any
8. Validity of offer- Clear mention
9. Signature of Members with date on each page
10. Accepting authority:
TAA to record decision on TCM
CAMTECH, Gwalior
NEGOTIATION
• The negotiation should be with technically acceptable
L1 and to be resorted in following exceptional cases:-

• Where the lowest tender is considered to be


unreasonably high, and it is felt that re-tendering
would not secure better advantage to the Railway and
/ or

• Where lowest tender is not acceptable due to any


reason and next higher offer is found to be
unreasonably high .

Tender to be discharged if negotiations fail


110
CAMTECH, Gwalior

Negotiation
1. Declaration form by Tenderer before
Negotiation:
 (RB Letter no 2008/CEI/CT/1 DATED 12/09/08)
A tenderer during negotiations is required to
give a declaration that in event of failure of
negotiation, his original offer shall remain open
for acceptance and not allowed to increase
rates of any of items .
“I…………………………………….Accordingly”
2. Form of offer after Negotiation.
 (CVC Order No 68/10/2005 dated 25.10.2005)
“From………………………..Signature & Date”.
CAMTECH, Gwalior

Negotiation with L-1


1. There should normally be no negotiations strictly be an
exception rather than rule and only where rates
received are unjustifiably higher and also in situation of
cartel formation with unreasonable rates.
2. Negotiations, wherever held, should only be with the
L-1 tenderer as explained in Board’s letter of even no.
dated 01.03.2000.
3. There shall be no compromise to transparency, equity
or fair treatment in acceptance of tenders. Prescribed
time frame of settling tenders is to be strictly adhered
to.
(Rly. Bds letter no. 99/RS(G)/779/2 dated 15.10.2007 RBS No. 15/2007)
CAMTECH, Gwalior
Acceptance of Tender
• Acceptance/modification/rejection of TCM left entirely
to the discretion of the accepting authority.
• Reasons for deviating from TC recommendations to be
recorded on the file.
• Accepting authority is fully responsible for his decision

Counter Offer
• Sometimes, counter offer may be given to the contractor
on the reduced rate or without accepting some
conditions.

• Contract can be awarded only after contractor’s


acceptance of counter offer.
113
CAMTECH, Gwalior

Counter offer
(RB Letter NO. 94/CEI/CT/4 DT 17.10.2000)

 In cases where the overall value of L1 is not


unreasonably high but rates of certain items or
total value for a schedule happen to be higher
than those quoted by other tenderers or higher
than LARs, method of counter offer may be
adopted
It is substitute/in lieu of negotiation.
CAMTECH, Gwalior
STAGES OF TENDER PROCEEDINGS

SN Activity To be Initiated Done by Time


by Limit
01 Preparing office note for approval SSE (Tender) & ADEE DRM/ADRM --

02 Calling for budgetary quotation from SSE (Tender) & ADEE OEM/Any other firm --
Firm

03 Concurrence to proposal SSE (Tender) Sr. DFM --

04 Preparation of estimate/ Est. cost SSE (Tender) SSE( Tender) --

05 Vetting of estimate SSE (Tender) Sr. DFM --

06 Sanction to estimate SSE (Tender) DRM/Sr DEE --

07 Tender booklet preparation with Terms and SSE (Tender) ADEE/DEE/ Sr DEE --
Conditions, scope of work etc.

08 EMD (2% of the estimated tender value up By Tenderer SSE (Tender) --


to 1.0crores), above this, 2 lakhs + 0.5% of
the excess of estimated cost
CAMTECH, Gwalior
STAGES OF TENDER PROCEEDINGS Contd..
SN Activity To be Initiated Done by Time
by Limit
09 Ensure Unit of Advertised Tender OS&SSE (Tender) SSE( Tender) --

10 Preparation of tender notice for open SSE (Tender)/OS Sr DEE --


tenders/OEM
11 Loading of Tender Notice on website SSE (Tender) ADEE --
before 35 days of opening of tender

12 Issuing of tender booklet before 25 days OS (Tender) ADEE/DEE --

13 Opening of tender OS (Tender) ADEE 01 Day


14 Submission of tender cost of down OS (Tender) ADEE 02 Days
loaded tender form to Sr. DFM (Same
day)
15 Verification of EMD submitted by OS (Tender) ADEE 07 Days
Tenderer
16 Preparation of brief note & tender SSE/OS (Tender) ADEE 01 Day
tabulation statement.
17 Verification of brief note SO (Wks A/cs) . OS (Tender) Engg. and accounts 05 Days
CAMTECH, Gwalior
STAGES OF TENDER PROCEEDINGS

SN Activity To be Initiated Done by Time


by Limit
18 Nomination of TC members SSE (Tender) Sr.DEE/DRM 01 Day

19 TC preparation SSE (Tender) TC Members 05 Days

20 Verification of eligibility criteria SSE (Tender) TC Members 07 Days

21 TC Finalization TC Members TC Members 07 Days

22 Acceptance of TC recommendations SSE (Tender) Sr DEE/DRM 01 Day

23 Issuance of Letter of Acceptance SSE (Tender) DEE/Sr DEE 01 Day

24 Submission of PG by the firm within 30 SSE (Tender) ADEE/ DEE / 15 Days


Sr. DEE
Days[ 5% of contract value ]

25 Verification of PG by law officer OS (Tender) SSE (Tender) 02 Days


CAMTECH, Gwalior
STAGES OF TENDER PROCEEDINGS

SN Activity To be Initiated Done by Time


by Limit

26 Verification of BG by bank OS (Tender) SSE (Tender) 05 Days

27 Preparation of Contract SSE (Tender) ADEE/DEE/ 02 Days


Agreement Sr. DEE

28 Signing of Contract Agreement SSE (Tender) With Rly. & Firm 03 Days

29 Dispatching of copy of Contract OS (Tender) SSE (Tender) 01 Day


Agreement to concerned depot in
charge.
30 Updation of finalised tender on net for OS & SSE (Tender) ADEE 04 Days
value more than 1.0 crores.

31 Releasing of first on account bill by OS/SSE (Tender) SSE(T)/ADEE/ --


preparing office note DEE/Sr. DEE

70 DAYS
CAMTECH, Gwalior
STAGES OF TENDER PROCEEDINGS
SN Activity To be Initiated Done by Time
by Limit

32 Completion report from depots. By Nominated By Nominated


Supervisor Supervisor
33 Refund of Performance Guarantee By Nominated Officer
(PG) after physical completion of work Supervisor concerned
( After completion certificate)
34 Refund of security deposit (SD) to the After getting No Claim Officer
contractor after expiry of Certificate from tenderer concerned
maintenance period and after passing
the final bill. ( After getting No Claim
Certificate from tenderer)
35 Arbitration, if any. By Firm/Tenderer Officer
concerned

Days
TOTAL
CAMTECH, Gwalior

Passing of bills –Initial Records


Para 1347: All bills be signed by the officer responsible for
the outlay) i.e. branch officer/officer incharge) in token of
his acceptance of the claims, any alterations or corrections therein
being duly initialed. In the case of contractor‟s bill the signature of
the contractor are also required in token of their acceptance of the
correctness of the bills submitted.
Running or on account bill form (No. E-1337) is given for use in
contract Works.
Preparation of Bills: No fees should be charged for forms of
bills or for clerical assistance.
Manner of payment:-
Unless otherwise specified payments to the Contractor will be made
by cheque but no cheque will be issued for and amount less than
Rs.100/-
(GCC 2014, Measurements, Certificates and Payments , Item No 46 (4))

GCC-2014, - 46 (2) Rounding off Amounts -


The total amount due on each bill shall be rounded off to the nearest rupee i.e.
less than 50 paise shall be omitted.
CAMTECH, Gwalior

Termination of Contract
In the events of faults on the part of contractor,
Railway can resort to:
1. Railway may serve the contractor 7 days notice in
writing.
2. If the contractor does not make good his fault within 7
days.
3. Before 7 days notice, write 2-3 letters to contractor
clearly bringing out his failure.
4. Railway shall be entitled after giving 48 hrs. notice to
rescind the contract.
5. Forfeit the whole or part of the SD as may consider fit.
CAMTECH, Gwalior

Termination of Contract -

6. The Termination/ Recission of contract shall be


conveyed to contractor under the signature of
contract signing authority.
7. It is necessary to issue final termination advice to the
contractor after issue of 48 hrs. notice.
(Rly. Bds L. No. 99/CE-I/CT/28 dated 24.03.2001)
CAMTECH, Gwalior

Retention of Records Related to


Contracts
S.N. Description of records Retention Period

01 Files, Papers and documents 05 years after agreement is


related to Contracts, agreements fulfilled or terminated but in
etc. case of audit objection,
( Retention schedule as per deptt. of these shall not be
administration reforms & public grievances destroyed.
in 2012)

02 Measurement Book (MBs) 10 years as per Engg. Code


para 1314.

03 Register of works 10 years as per Engg. Code


para 1474.
CAMTECH, Gwalior
Do‘s
 Allow adequate and reasonable minimum time (as prescribed) for opening of
all tenders to encourage proper response.
 Ensure timely supply of copies of approved plans for tenders where special
items rates have to be quoted for the particular details of the approved plans.
 Ensure the comparative statement and briefing note have been prepared and
duly signed by the concerned officials on each page.
 Only consider offers accompanied by requisite earnest money in proper term.
 Attempt identification of sister concerns to detect cartel formations especially
in the case of limited tenders.
 Ensure consideration of reasonableness of rates in the tender committee
minutes. This should not be with reference to presumably accepted rates, but
also after taking in to accounts market rates and analysis of rates.
Reasonableness has to be explained in detail.
 Obtain views of the Competent Authority to deal with the lowest acceptable
offer of contractors with adverse reports.
 Treat the Tender Committee recommendations with dissenting notes
carefully. Dissent should be part of running minutes with views of other
members also on it.
CAMTECH, Gwalior
Do‘s
 Negotiation should be an exception and not the rule in acceptance of
tenders. These are to be held with lowest valid tenders only.
 Record relevant reasons for overlooking the lowest offer if it is not
acceptable. Speaking decision is a must.
 Order calling for fresh tenders if items are to be revised or their value is
to be enhanced.
 Ensure that the tender committee minutes contain the relevant
information as the date, venue of the meeting and dated signatures of
the members.
 Record the acceptance or otherwise on the body of the tender
committee minutes only & not on the noting side of the file.
CAMTECH, Gwalior

Do‘s
 Ensure that the rating of the offers received is done properly after
evaluating the special conditions and vetting by finance.
 Ensure that the reasonableness of rates is examined critically,
logically and specifically both in respect of total cost and rates of
important individuals items.
 Beware that the low offers are in facts so in reality and price,
differential for similar but different items of schedule is reasonable.
 Ensure that the tender committee is duly constituted of competent
level of officers specified.
 Ensure prior sanction of competent authority before executing
additional quantities (beyond 25%) in such items so that the contracts
are not vitiated.
CAMTECH, Gwalior

Don‘ts
 Do not change the Tender Committee members once constituted without prior
approval of competent authority.
 Do not consider delayed/ late tenders except under specified exceptional
circumstances & that too only by following prescribed procedure.
 Do not treat the Tender Committee’s recommendations with dissenting notes
from one or more members of the Tender Committee as unanimous
recommendations.
 Do not order negotiation on the repeated advice of tender committee to invite
fresh tenders, particularly where response to the call for negotiations is poor.
 Do not exercise the power of accepting authority in case you have been a
member of the Tender Committee. Let it go to higher authority.
 Do not hold negotiation with those who had either not tendered originally or
whose tender was rejected because of unsatisfactory credentials, inadequacy
of capacity or where tenders were unaccompanied with adequate earnest
money or any other invalid tenders.
 Do not accept open quotations from contractors during negotiations.
CAMTECH, Gwalior

Don‘ts
 Do not entertain letter / representations of tenderer subsequent to opening/
negotiations/ consideration of tenders.
 Do not accept modified offers, not considered by the Tender Committee.
 Do not allow subsequent revision of the minutes unless the reconsidered
minutes are put-up in addition.
 Do not advise the tender committee prior to their deliberations on the
suitability or otherwise of any particular offer.
 Do not allow anomalies in evaluation of special conditions to affect the
acceptance of the offer recommended.
 Do not operate non-schedule items without sanction of competent authority .
In exceptional cases where it has to be done, maintain necessary site records.
 Do not operate non-schedule items where it is possible to do work as per
schedule items or a combination there of.
 Do not award works on questions in a routine manner and strictly follow
annual financials limits laid down.
CAMTECH, Gwalior
Phase I - Module No. FC-10-ppt-1
Case 1:Irregularities in
purchase of optical fiber cable
• OFC was railway board procurement item. Purchase at
Zonal railway was justified as E.P. although tenders at
railway board had been finalized.

• The quantity to the tune of more than 6 months


requirement was purchased instead of 3 months
requirement. The proper action could have been to send
indent to board.

• Optical fiber accounts for 70% of the total cost. Its market
prize were crashing down.
OFC- case study

• Rate reasonableness- should have been examined


considering last purchase rate market conditions and railway
board letter.

• TC referred a news paper clipping in which the cost optical


fiber was indicated to be 70% of OFC cost but no cognizance
of the fact that BSNL was going to cancel a tender in view of
fall in OF prizes was given. Recommended rates were 10%
higher than rates received by BSNL.
Case 2:Irregularities in purchase of
elliptical wave guide- case study
• TS to be just with respect to tender specification. In this case
one firm was declared unsuitable due to reason that same is
inferior to other offer.

• RR was certified by selectively picking up very old LP rate of


another railway. Ignoring more recent orders and also the
budgetary quotation obtained from same firm.

• In this case TC justified RR by adding 20% ED even though


this being a imported item ED not leviable.
Irregularities in purchase of
elliptical wave guide- case study
• Tender condition indicated 30/24 months warranty clause.
TC recommended 1 year warranty for date of shipment
without bringing out it in deviation statement. Warranty was
over before the material was unpacked.

• The tender condition indicated inspection by RITES


TC changed the clause to consignee.

• Warranty certificate and test data were not furnished by


OEM instead dealer gave these documents on his letterhead.
Case 3: Irregularities in procurement of
packaged drinking water- case study

• Lower offer of reputed firm was by passed on the grounds :-


Tender document was purchased in the name of sister concern
(but declaration was submitted to this effect.)

• Submission of financial bid (Packet-B) and technical bid


(Packet-A) in the same cover due to which both got opened at the
same time.

• TC recommended giving a counter offer to the 2nd lowest firm


TAA accepted recommendations of giving counter offer to 2nd
lowest firm with a modification that counter offer be given to 7
other firms.
Irregularities in procurement of
packaged drinking water- case study

• 2nd lowest firm did not accept counter offer.

• Out of 7 only 3 firms accepted CO.

• On TC recommendations TA accepted tender on differential


rates to the 4 firm.

• One firm out of the 3 firms got a contract for which it had
not even quoted the rates.

• This was against the basic tenets of tendering.


Case 4:Splitting, introduction of
eligibility condition in LT- case study

• Three separate LTs costing 15 lakhs each for transportation


work were invited on plea of giving contract separate agencies but
subsequently all three tender awarded to the same agency.

• After tender notification eligibility condition was introduced


without approval of CA. The condition was framed with view to
favour one firm.

• Introduction of EC further restricted the competition.

• Contract was awarded at exorbitant rate by comparing the unit


rate of small lead with long lead.
Procurement
•Indenting
•Tendering
•Tender Opening
•Tender Considerations Tender Acceptance
•Local Purchase
•Post Contract
•Receipt of Materials
INDENTING STORES

Furnish detailed and unambiguous


description with specification and drawing
number.
Indicate quantity, both in figures and words.
Ensure that the quantity indented is as per
approval of the approving authority.
INDENTING STORES

Specify a reasonable delivery period. Avoid


terms like “Urgent” and “Immediate” and
be specific about the date by which the
material is required.
Double check the rate indicated as the
estimated rate or last purchase rate before
signing the indent. Furnish the basis of this
rate such as the last Purchase Order
No.,date, quantity and source.
...
INDENTING STORES

Indicate the estimated or last purchase


rate in figures as well as words.
Avoid calling for supplies to samples as
far as possible.
While approving quantity on indents,
ensure that the quantity is fully justified
in relation to the asset(s) for which the
procurement is to be made.
INDENTING STORES
DONTs
 Split quantity to bring within
powers of purchase of local
authority.
 Submit PAC when not warranted.
 Exceed powers for signing of
indents.
INDENTING STORES
DONTs
 Send indent to purchase office without
routing through stores depot for certification
NS.
 Include favorites firms/dummy firms in the
list of likely sources.
 Force LT in the name of urgency
 Furnish high estimated rate enabling higher
rates of acceptance.
WHY TENDERING
Tendering is the means for
obtaining the most
competitive offer and
thereby obtaining the best
return for public money.
Tendering
 Types of tenders:
(a) single tender
(b) limited tender and
(c) open/advertised tender
Please ensure that type of tender is
appropriate. No false urgency is shown
to justify restrictive tendering.
Supply Tenders & Contracts
 Types of Tenders: OT/LT/SpLT/ST/BT
 Captive or proprietary nature
 With or without a PAC
 PAC a personal responsibility
 OEM Spares:
 Traction Motor [BHEL],

 Siemens [RRI etc.],

 Bombardier [ABB: Elec Loco (Tap Changer etc.)],

 Mico [Injection System]


PAC
•I approve the above purchase & I certify that-
•(a) No other make/brand will be suitable
•(b) This is the only firm who is manufacturing/
stocking this item
•(c) A similar article is not manufactured/ sold by any
other firms which could be used in lieu of.
• NB: If (c) is deleted Purchase Power gets restricted to
Rs. 200000/- only, else GM’s approval)
TRANSPARENCY IN
Tendering
 Special conditions should be framed
judiciously and each should be properly
evaluated.
 Eligibility should be fixed in such a way
that it does not restrict competition and
at the same time eliminate unworthy
bidders.
EQUAL OPPORTUNITY
« All the eligible bidders must get equal
opportunity for bidding. For this --
 All the bidders should have proper
access/information about the work.
 Tender papers should be given in time.
 Quantity should be firm.
 Eligibility criteria should be appropriate.
 Tender papers must be complete and
elaborate.
 LT: Last successful supplier
Supply Tenders & Contracts
1 TPO. L1 Quoted DP unsuitable
2.Check possibility of splitting, minimum qty
only on higher rate.
3.Time is the essence of contract, more so in
TP order case
4.Advance agreement required as to the rate
applicable in case of delay, hence a clause is
to be incorporated in the PO
5.Payable Rate = Contract Rate – [{(Delay in
Number of Days)/(DP in days by Lower
Tenderer – DP in days quoted by Contracting
firm)} x (Difference in rates quoted by the
two firms)]
Supply Tenders & Contracts
 Instructions to Tenderer like;
 EMD: From all unregistered firms
 Even the PVT firms, ask EMD
 Rate 2% of estimated value, Max 20,000/-
 Sufficient to ensure earnestness of the party!

 Can be waived on the merit of case;


 firm of repute

 NO EMD
 From other Railways

 Railway’s own approved suppliers

 Govt. dept., PSUs [Central & State]

 NSIC firms

 From Manufacturers & their accredited agents


TRANSPARENCY IN
OPENING OF TENDER
 Tender must be opened on the
appointed day, time and place.
 It should be opened in presence of as
many witnesses as possible.
 Read out and record the rates/special
conditions of all the bidders.
 Identify all the omissions, over-writings
& corrections.
Tendering
As far as possible adopt competitive tendering
systems such as open tenders and bulletin
tenders.

Ensure that the tender opening is done in letter


and spirit as per the relevant Railway Board
Instructions and that all the terms and
conditions having financial implications on each
and every offer are circled and initialed
promptly at the time of the tender opening.
TRANSPARENCY IN
OPENING OF TENDER
Allow adequate and
reasonable minimum time
(as prescribed) for opening
of all tenders to encourage
proper response – except in
emergencies.
TRANSPARENCY IN
TENDER CONSIDERATION
 Ensure that rating of the offers received is done
properly after evaluating the special conditions and
vetting by finance.

 Ensure that the tender committee is duly constituted


of competent level of officers specified.

 Ensure consideration of reasonableness of rates in


the tender committee minutes. This should not only
be with reference to previously accepted rates, but
also after taking into account market rates and
correct analysis of rates based on market survey.
TRANSPARENCY IN
TENDER CONSIDERATION
 Technical suitability to be seen w.r.t.
tender specification and schedule of
requirement.
 Record relevant reasons for overlooking
the lowest offer if it is not acceptable.
 Conduct negotiations only in exceptional
cases (where rates are invariably high
and re-tendering is not possible/
desirable) and not as a matter of routine.
Supply Tenders & Contracts
 Firm Prices
 Normally
 PVC
 Base Price, Base Date, relevant formula,
required documents
 Fix a higher ceiling
 Late/delayed Tenders
 Posted after the date & time of closing
 Posted before the date & time of closing,
but;
 received between the closing & opening time
 or after the opening time
 Ignore?
TRANSPARENCY IN
TENDER CONSIDERATION
 Ensure negotiations with the lowest (L1)
tenders after getting approval of the
competent authority
 Attempt identification of sister concerns
to detect ring formations – especially in
the case of limited tenders.
 Ensure that the tender committee
minutes contain the relevant information
as the date venue of the meeting and
dated signatures of the members.
Supply Tenders & Contracts

 Discounts;
 Conditional Discounts
 Cash Discounts
 Advance payments
 100% PI payments: AGM standing
sanction
 ABB, MMTC, NEI, Hindustan Zinc etc
 90/95/98% payments: IC & Proof of
dispatch
 Advance along with order
 Rs 3 lacs or 30% whichever is less [Annex
III/2-10]
 ITI SBC, Hindustan Cables: 25% & 50% advance
TRANSPARENCY IN TC
PROCEEDINGS
 Proceedings should be drawn in such a
manner that it replies to all the queries
which may be made later and TC
Members are not required to be called
for clarification either by the Tender
Accepting Authority or by the
Investigating agencies i.e. Audit,
Vigilance or CBI.
 Never hide favourable/ unfavourable
information.
TRANSPARENCY IN
TENDER CONSIDERATION
Ensure that security deposits and
earnest money deposits are
collected from unregistered
suppliers as per rules and when
exempted, proper reasons are
recorded and competent authority’s
sanction taken for the same.
TRANSPARENCY IN
TENDER CONSIDERATION
 When the descriptions or
specifications undergo significant
changes after invitation of tenders,
ensure that equal opportunity is
afforded to all the suppliers by re-
tender.
TRANSPARENCY IN
TENDER CONSIDERATION
 Do not change the tender committee
members once constituted without prior
approval of competent authority.
 Do not consider delayed / late tenders.
 Do not allow anomalies in evaluation of
special conditions to affect the
acceptance of the offer recommended.
TRANSPARENCY IN
TENDER CONSIDERATION
 Do not accept open quotations from the
contractor during negotiations.
 Do not entertain letters/
representations of tenderers
subsequent to the
opening/negotiations/ consideration of
tenders.
TRANSPARENCY IN
TENDER CONSIDERATION
 Do not accept a single tender received in
response to a call for limited tender unless
the work is very urgent and permission from
competent authority has been obtained.
 Do not exercise the powers of the accepting
authority in case you have been a member of
the tender committee.
TRANSPARENCY FOR
ACCEPTING AUTHORITY
 Do not allow subsequent revision of the
minutes, unless the reconsidered
minutes are put up in addition.
 Do not record the acceptance/
otherwise of the tenders anywhere else
than the body of the tender committee
minutes – noting side of the file is to be
endorse action taken only.
TRANSPARENCY FOR
ACCEPTING AUTHORITY
 If Tender Accepting Authority wants to
disagree with the Tender Committee or
to agree with some members in a non-
unanimous proceedings, TAA must
record the detailed reasons.
 TAA should not obtain any information
from a source other than the Tender
Committee.
TRANSPARENCY FOR
ACCEPTING AUTHORITY
 Do not advise the tender committee
prior to their deliberations on the
suitability or otherwise of any particular
offer.
 Treat the tender committee
recommendations with dissenting
notes carefully
TRANSPARENCY FOR
ACCEPTING AUTHORITY
 Do not order negotiation on the
repeated advice of tender committee to
invite fresh tenders, particularly where
response to the call for negotiations is
poor.
 Do not accept modified offers, not
considered by the tender committee.
Supply Tenders & Contracts

 Negotiations
 Techno commercial clarifications
 In case of ST, LT & OT: rate unreasonably
high
 Only with L1: CVC: 1998
 L1: Price/Purchase preferences: SSI & CPSU
 L1: Cartel situations
Supply Tenders & Contracts
 Price Determination

 Factors influencing the price


 Supplier’s or buyer’s market
 Quality, quantity, after sales service
[warranty]
 Mode of transportation
 Packaging requirement
 Price cost analysis
 Price forecast
 Trend: Plot past rates
 Inflation: Use published price indices
 Statistical Methods: Moving average ETC.
Supply Tenders & Contracts

 Formal PO
 Standard form
 PO numbering: xx xx xxxx x xxxxx
xx
 Finance Checks:
 Error removal: Effect on lead time!
 Shirking of responsibility by
Purchaser
 Allotment of Budget: Freedom &
accountability: US Railroads
Supply Tenders & Contracts
 Fixed Contracts
 Period Quantity & Rate [PVC]
 IR contracts for supply
 Special Conditions of Contracts
 Terms of delivery [FOR destination]
 Payment terms [90+10%, for M/C], {Now EFT}
 Warranty/AMC for M/C or other items
 Delivery [not vague]/Validity requirements
 Preferences as per the Govt. India Policy
 Condition relating to Cartel Formation
 Quantity splitting & Quantity variation clauses
 Samples in certain cases
Supply Tenders & Contracts
 Standard Conditions of Contracts
 Risk in Stores
 Consignee’s Right of rejection
 Even in case of interim consignee
 Subletting & Assignment
 Inspection
 Facility provision for test & inspection, Notice in
writing, Method of test & cost of tests, Marking of
Stores
 Powers of Inspecting Officer
 Insolvency & breach of contract
 Jurisdiction of Courts
 Arbitration:
 Either Party can ask for. Works Contract?
POST CONTRACT
 Be vigilant about increase/decrease in prices,
revision of taxes and duties while granting
extension to delivery dates.
 Be vigilant about requests for change of
inspection clauses as request may come from
the supplier for such a change to get over
some inconvenient inspecting agencies.
POST CONTRACT
 Ensure that risk purchases are
completed within the time schedule and
also that the risk purchase claims are
lodged to the defaulting suppliers
promptly without delay.
POST CONTRACT
Always guard against suppliers asking for
relaxations in description or specifications
after release of order, as it is quite
possible that the relaxation asked for has
been already rejected in the original
tender.As the suppliers to write to the
purchase authority for any amendments
to the terms of the Purchase Order.
LOCAL PURCHASE
DOs
 Indicate quantity and rate both in
figures and words.
 Ensure that a register of local purchase
sources is maintained after inspection
of the existence and capacity.
LOCAL PURCHASE
DOs
 Even if the lowest offer is accepted, still
ensure that the accepted rate is
reasonable.
 Ensure that enquiries are sent by
rotation to registered local suppliers.
LOCAL PURCHASE
DONTs
 Do not split indents to bring the
purchase within the local purchase
power.
 Do not collect more than one quotation
from single firm.
LOCAL PURCHASE
DONTs
 Do not purchase stock item (PL item)
through non-stock, except under special
circumstances recording the reasons for
the same.
 Do not purchase items on credit.
 Do not issue an enquiry unless the
existence of the firm has been checked.
LOCAL PURCHASE
 Before accepting a quotation,have
a look at all the quotations and see
that they have been arranged in
the correct order.
 Be vigilant while deciding offers
with small differences on all
inclusive prices.
RECEIPT OF MATERIALS

 When the supply is rejectable, ensure


that the rejection memo reaches the
supplier within the stipulated time (of
45 days from DGS&D contract and 90
days for Railway orders). If inspection is
delayed, then it may not be possible to
achieve this target.
RECEIPT OF MATERIALS
While accepting supplies and granting
receipt notes thereof or certifying
suppliers bills ensure that all deviations
from the purchase order are covered by
proper amendments from the purchase
office, and that proper endorsements are
made where certain amount is to be
recovered from the supplier on the
concerned contract.
ACCEPTANCE OF MATERIAL
 Supplies to be checked with reference
to contract specifications.
 Suitability or otherwise for the end use
cannot be a criterion for acceptance or
rejection.
Phase I - Module No. FC-10-ppt-2
CAMTECH, Gwalior
www.ireps.gov.in

e- Procurement System

 Central
Railway
CAMTECH, Gwalior

E-Procurement / E-Tendering

 PURPOSE – Why E-Procurement ?


 What is E-Procurement/E-Tendering ?
• Business Process – Workflow
• Scope
 Requirements – Challenges Involved.
 Security – PKI Infrastructure
 IREPS – Experience, Lessons
CAMTECH, Gwalior

PURPOSE: Why EPS

 To Stimulate COMPETITION
 To Ensure TRANSPARENCY
- Better Information Sharing, RTI
 To Achieve EFFICIENCY
- For Buyer, For Seller
- Reduced Lead Time, Costs Saving
 Avoid unnecessary paper work
 Stake-holders in e-GP
 CVC Guidelines for E-Tendering
CAMTECH, Gwalior

PURPOSE Contd...

Objectives of e-GP

• Governance - Transparency, Accountability


• Effectiveness - Efficiency, Value-for-money
• Balanced Development
- Competitiveness
- Business Development
- Regional Development

SMART Governance
CAMTECH, Gwalior

What is EPS ?
Business Process – Existing System

Purchase/Works Proposal Prepare NIT, Tender Schedule

Advertise NIT – T.O.D., EMD,


Receipt of Offers in T.Box
Tender Sale

Tender Opening on D.Date


Tabulation of Offers
Public Opening

Acceptance of Tender Tender Decision - TCM


P.O./Contract

Monitoring, Supply, Payment….


CAMTECH, Gwalior

What is EPS ? Contd…

Purpose & Definition

 E-procurement Application shall provide a


common platform on secured Web site
where the Buyer and Sellers can participate
in E-Procurement process in a fair and
transparent manner.
 The E- Procurement system to be adopted by
Railways shall be governed by the security
features as provided under I. T. Act 2000.
 Use of Internet & Communication
Technologies for Procurement functions.
CAMTECH, Gwalior

E-Procurement definitions

 E-tendering: Procurement are made through process


of competitive bidding.
 E-purchase: Online ordering based on quotations for
high volume, low value mass purchase.
 E-procurement: E-procurement is the business-to-
business purchase and sale of supplies and services
over the secured Internet.
 E-procurement software may make it possible to
automate some buying and selling thru Internet..
 Reverse & Forward Auction: Online bid participation
and acceptance using controlled access
permissions.
CAMTECH, Gwalior

SCOPE OF WORK

 Uploading of Tender notices and Tender


documents On-line on secured and dedicated
website for railways.
 Submission of digitally signed electronic bids for
Data Integrity, Authenticity, Non-Repudiation,
and Confidentiality.
 Pre-designed online bid forms for bid submission.
 Scope of work shall include all type of tenders for
supply and works
CAMTECH, Gwalior

SCOPE OF WORK Contd…

 Tenders by Stores, Engineering and


Construction organization of zonal railways.
 Reverse Auction /Auction sale.
 Payment Gateway Integration for online
payment.
 PKI enabled data Encryption / Decryption.
CAMTECH, Gwalior

Requirements / Features

 Security Features – PKI Infrastructure


 Encryption (128 bit SSL), Digital Signature
 Time-locking of electronic tender box
– Time stamping of transactions.
– Notarization from certifying authority.
 Upload/Opening with Secured digital permission.
 Online access/witness to tender opening.
 Online Tender tabulation – viewable by authorized
 Back-end integration of data with MMIS.
 Contract & amendment uploading, online access .
CAMTECH, Gwalior

Features Contd…

 Introduction of Public Key Infrastructure as


approved under Indian I.T. Act 2000
 Tenderers to obtain & use Digital Certificates
 To ensure security & authenticity of the documents
 Digital signatures from agencies approved by
Dept. of I.T. (http://www.cca.gov.in)
 Data encryption during storage & transfer
 Intrusion detection system feature.
 Audit trails and use of fire wall.
CAMTECH, Gwalior

MMIS
CAMTECH, Gwalior

Digital signature

A digital signature is an electronic


signature that can be used to
authenticate the identity of the sender
of a message or the signer of a
document, and to ensure that the
original content of the message or
document that has been sent is
unchanged.
CAMTECH, Gwalior

Security - PKI

 Public Key Infrastructure (PKI) is the


combination of software, encryption technologies,
and services that enables enterprises to protect
the security of their communications and business
transactions on networks
 A key is like a code sheet
 A public key is an odd concept
– why would you reveal your secret code in public?
 We need to understand symmetric keys and
asymmetric keys
CAMTECH, Gwalior

PKI : Contd…
 Symmetric Encryption
– Single Key for Encryption/Decryption

Encryption
Plaintext

Ciphertext
Key
and encryption algorithm

Decryption

=>Any Problems? Is
Faster!
CAMTECH, Gwalior

PKI : Contd…

 Asymmetric encryption

Encryption

Key 1 and
encryption algorithm
Decryption

Ciphertext
Plaintext
CAMTECH, Gwalior

PKI: Contd…

 Asymmetric encryption – Contd…


– Separate Keys for Encryption & Decryption

Encryption

Key 1 and
encryption algorithm

Ciphertext
Plaintext

Key 2 and
encryption algorithm

Decryption
If Key 1 = private, Key2 must be corresponding public
If Key 1 = public, Key2 must be corresponding private
CAMTECH, Gwalior

PKI - Public and Private Keys

 Keys exist in pairs


– Keep one private (very secret) and 'publish' one
– Public keys can exist on certificates
 Encryption can be done by either key
– If it is your key pair, you can use the private key
– Anyone else can use the public key to encrypt something
 Encryption by Private Key > Authentication
 Encryption by Public Key > Secure Communication
CAMTECH, Gwalior

Public key Encryption

B's public key B's private key


Plaintext

Hi Bob Hi
#d%G
Alice Bob
*!ki4i
Alice

Ciphertext
Vender
A
Encrypt Decrypt Buyer
B
• A encrypts bid data with B’s public key (available with
tender document)

• A sends Bid data to B, knowing that only B


can decrypt it with his private key.
• B decrypts with his own private key ( secretly kept)
CAMTECH, Gwalior

Basic Digital Certificate


Identifies certificate format Identifies this certificate
.

Version Name of
Algorithm certification
used to Serial number
authority
sign Signature algorithm
certificate Issuer name
Validity period
Start date
and Subject name
end date Subject public key
Issuer’s signature

Public key value and Identifies the owner


indicator of its algorithm Ensures cert. data of the key pair
can’t be changed
CAMTECH, Gwalior
Example of Digital Certificate
CAMTECH, Gwalior
Features of IREPS

• Central Data Center managed by CRIS.


• Single website portal for All Railways.
• Each Railway Page for Tender upload
and Tender Box opening.
• All Railway Tenders on Single web Portal.
• Training and familiarizations by CRIS.
• Available for both Stores & Engineering.
CAMTECH, Gwalior

Benefits of E-Procurement

 Improved transparency.
 Online access to Information.
 Online participation and information sharing.
 Reduced procurement cycle time.
 Improved Material and Inventory
management.
 Faster payments through payment gateway.
 Shift from paper based business to electronic
business.
CAMTECH, Gwalior

Benefits Contd…

 Better cost efficiency through reduced cost of


logistics during tender participation.
 Integration of procurement process through single
website for entire railway.
 Online data sharing of contracts between zonal
railways.
CAMTECH, Gwalior

Issues Involved
Following major issues are involved which need
to be reviewed:

 Digital Archive need: There is no well laid down


mechanism to attach proof of digital signatures on
files after decryption of documents.
 Submission of some forms and documents such
as partnership deeds, authorisation-certificates,
bank statements, etc. which need attestations by
public notary still need to be submitted manually.
 Participation by foreign venders using digital
signatures issued by foreign agencies - IT act
permits digital certificates issued in India
CAMTECH, Gwalior
►Website for e-Procurement www.ireps.gov.in
►Click on “Login” for getting started
CAMTECH, Gwalior
► ENTER LOGIN ID AND PASSWORD of User
► CONNECT e-TOKEN in USB PORT
CAMTECH, Gwalior
►After Login we will get personalized Home Page
►Name of the user will be displayed on green bar
CAMTECH, Gwalior

e-Procurement System
Creating and
Uploading of
Tender
CAMTECH, Gwalior
► To Create tender, click on “Create NIT” link
CAMTECH, Gwalior
► This will open tender form, has mainly two parts
► Enter the details in the fields provided
CAMTECH, Gwalior
►PART I >Viz. Fill in Tender No., Type, Section,
Date, TDC/EMD amount, Delivery period,
Description and Click on “Save” Button.
►This will initiate Tender Creation.
CAMTECH, Gwalior
►Scroll down and fill up PL No., Description and
Consignee details.
►Click on “Add Item” button
CAMTECH, Gwalior
►After Clicking on “Add Item” button, a message
will appear as “Data inserted Successfully”
CAMTECH, Gwalior
► Now, to insert vendor names, click on “Click
here to add vendor details” link
►This will open a new window, insert minimum
CAMTECH, Gwalior

three characters of Vendor Name and click on


“Search Vendor” Button.
CAMTECH, Gwalior
► List of Vendors as per search criteria appear
► Select desired vendor and press “Add to List”
►Click on Close window on successive window.
CAMTECH, Gwalior
►Likewise, enter data for remaining fields and
press “ Add to List” button
CAMTECH, Gwalior
► To attach document viz. Spec., Drawing etc.,
The attachment should be in “pdf” format only.
►Browse document and attach it by “Upload”
CAMTECH, Gwalior
► AFTER FILLING-UP ALL MANDATORY FILEDS:
CLICK ON ATTACH CERTIFICATE. THIS WILL OPEN A WINDOW WHERE
ENCRYPTION CERTIFICATE OF OFFICER TO BE SELECTED.
THIS WILL ENCRYPT THE TENDER SUCCESSFULLY
CAMTECH, Gwalior

► SUCCESSFUL OPERATION WILL SHOW FOLLOWING MESSAGE


CAMTECH, Gwalior
► After encryption, Click on “Sign & Submit” button. This will open a window
where Signing Certififcate of the Officer to be selected.
► THIS WILL UPLOAD THE TENDER SUCCESSFULLY (i.e. LIVE TENDER)
CAMTECH, Gwalior

Note:

 After valid certificate is attached successfully,


Sign & Submit is enabled to attach the digital
certificate. Once Sign & Submit is Successful
user would get the following view of brief
tender document and mail would be fired to
all the listed vendors of the tender.
CAMTECH, Gwalior

► NOW TENDER IS UPLOADED ON IREPS SITE.


► THE LIVE TENDER DOCUMENT.
CAMTECH, Gwalior
► TO DOWNLOAD AND TAKE A PRINT OF TENDER DOCUMENT,
CLICK ON “DOWNLOAD TENDER DOCUMENT” LINK
► THIS WILL OPEN THE TENDER DOCUMENT IN PDF FORMAT
WHERE YOU CAN TAKE PRINT OF IT
e- Procurement System
Central Railway

Tender
Opening
CAMTECH, Gwalior
► Login to the ireps account by entering Login ID and password
CAMTECH,
► ClickGwalior
on “Quick Search”
CAMTECH, Gwalior
►Enter desired tender no. for Tender Opening and press “Show Result”
CAMTECH, Gwalior
►Click on tender box opening icon provided therein
CAMTECH, Gwalior
► Enter login passwords of both Purchase Officer and Accounts person in
respective fields
►Click on “Open Tender Box” button.
CAMTECH,
► Gwalior
Insert Purchase Officer’s e-token and press “OK”
CAMTECH, Gwalior

Note:

 A pop-up window will appear where required


to fill up Purchase officer’s e-token password
 Likewise, insert e-token for Account person
and enter correct password for it.
CAMTECH, Gwalior
► As the Digital Authentication is successful the following screen appears
► Now attach
CAMTECH, Gwalior
Decryption Certificate and enter password for it in pop-up window
► Following message will appear after successful decryption of the data
CAMTECH, Gwalior
► As the decryption is successfully done the following screen appears where
the tender opening official has to press “acknowledge and sign” button
CAMTECH, Gwalior

Note:

 Once the signing is successful, the tender


box is opened and offers, technical bids and
financial bids can be viewed.
 Technical Evaluation can also be seen to
take a decision on awarding of tender to a
particular winner vendor.
CAMTECH,
View Financial Tabulation – This link of the Action Column is used to view the
Gwalior
Financial Tabulation Statement of all financial bids submitted by all the vendors
against this tender in a pdf format. IT is a comparison statement which can be
used in decision making about awarding the tender to winning bidder
CAMTECH, Gwalior
► This is a sample “Financial Bid” statement
View Techno-Commercial
CAMTECH, Gwalior Tabulation – This link shows the techno commercial
details / bids, as submitted by all the vendors against this tender in a pdf format.
It consists of Tender Type, Bidding System, Tender Description, Eligibility Criteria,
and Performance Statements etc.
DO’s & DON’T’s IN CONTRACTS &
CASE STUDIES

Phase I - Module No. FC-10-ppt-4


 Every Rly. Officer is vigilance officers
hence they must exhibit fair play and
observations of the canons of financial
property
 Every contract case may be dealt with
observation of extent rules, common
intelligence & value system
TENDERS AND CONTRACTS : DO’S
 Allow adequate and reasonable minimum
time (as prescribed) for opening of all
tenders to encourage proper response -
except in emergencies.
 Ensure timely supply of copies of
approved plans for tenders where special
items rates have to be quoted for the
particular details of the approved plans.
 In case of open tender! issue tender form
to all the parties who demand it on the
production of proof of depositing of cost
of tender form.
 Ensure that the tender documents are
available for sale at least 15 days before
opening of the tenders.
 Clearly specify the requirement of
'similar nature of work: for the eligibility
criteria in the tender so that no
ambiguity arises during tender
committee meeting.
 Only consider offers accompanied by
requisite earnest money.
 Ensure that tender abstract (comparative
statement) and briefing note have been
prepared and duly signed by the
concerned officials on each page.
 Ensure that ranking of the offers is done
properly after evaluating the special
conditions and vetting by finance.
 Ensure that the tender committee is duly
-constituted at competent level of
officers specified.
 Ensure consideration of reasonableness
of rates in the tender committee
minutes. This should not only be with
reference to previously accepted rates,
but also after taking into account market
rates and analysis of rates.
 Ensure that the reasonableness of rates
is examined critically, logically and
specifically, both in respect of total cost
and rates of individual items
 Departmental and contractual
executions should not be allowed
simultaneously at the same location.
 Record adequate reasons for overlooking
the lowest offer if it is not acceptable.
 Conduct negotiations only in exceptional
cases and not as a matter of routine.
 Attempt identification of any possible
ring formations -especially in the case of
limited tenders.
 Ensure that the tender committee
minutes contain the relevant information as
the date, venue of the meeting and dated
signatures of the members on each page.
 Special conditions of contract should
normally not be changed without weighing
the financial implications thereof.
 Scrutinize the Tender Committee
recommendations with dissenting notes
carefully & record reasons for
disagreement.
 Order calling for fresh tenders if the TC
comes to learn that there is significant
change in scope of work.
 Display the details of tenders accepted
(costing more than RS.1 Crore for
Engg./Elect./S&T/Mech. & Medical Depts.,
RS.50 lakhs for· Commercial Dept. and RS.20
lakhs for Stores Dept.) during each Month on
official web-site for better transparency.
 Ensure that in the open tender document,
the tender document is uploaded on the
official website of Indian Railway at least 15
days before the date .of opening of the tender
so that the prospective tenderers can
download the tender form.
TC should deliberate not only on eligibility
criteria but also on credentials of tenderers.
Ensure that the successful bidder submits
a Performance Guarantee (PG) in the form of
an irrevocable bank guarantee amounting to
5% of the contract value after the letter of
acceptance has been issued, but before
signing of the agreement. This guarantee
shall be initially valid upto the stipulated
date of completion.
The PVC shall be applicable for the tenders
of value more than 1 Crore irrespective of
the contract completion period and the PVC
shall not be applicable to the tender of value
less than 1 Crore.
 TC shall examine the overall financial
soundness of the tenderers based upon the
volume of work handled, turn over, balance
sheet, etc.
 Wherever variation in execution of
individual NS item is inescapable, the same
should be done with the approval of
Engineer in charge.
 Negotiation is allowed only with L 1 i.e.
lowest valid eligible and technically
acceptable tenderer who would have been
otherwise considered for award of contract
directly if the rates were not unreasonably
high.
 For dealing with variation in quantities during
execution of works contracts, individual NS
items in contracts shall be operated with
variation of plus or minus 25% and payment
would be made as per the agreement rate. For
this, no finance concurrence would be required.
 In case of increase in quantity of an individual
item by more than 25% of the agreement
quantity is considered as unavoidable, the same
shall be got executed by floating a fresh tender.
If floating a fresh tender is considered not
practicable, negotiations may be held with the
existing contractor for arriving at reasonable
rates for additional quantities in excess of 25%
of agreement quantity. No such quantity
variation limit shall apply for foundation items.
TENDERS AND CONTRACTS:
DONT’S
 Do not change the tender committee
members once constituted without prior
approval of competent authority.
 Do not consider delayed/late tenders
except under specified exceptional
circumstances.
 Do not allow anomalies in evaluation of
special conditions to affect the acceptance
of the offer recommended.
 Do not accept open quotation.s from the
contractors during negotiations.
 Do not entertain letters/representations of
tenderers subsequent to the opening of
tenders in general.
 Do not accept individual items rates which
are abnormally high or unworkable in
respect of major items of work in a tender.
 Do not accept a single tender received in
response to a call for limited tender unless
the work is very urgent and permission from
competent authority has been obtained.
 Do not exercise the powers of the
accepting authority in case you have been a
member of the Tender Committee.
 Do not treat the Tender Committee's
recommendations with dissenting notes
from one or more members of the Tender
Committee, as a unanimous
recommendation. Record reasons for the
decision.
 Do not advise the Tender Committee prior
to their deliberations on the suitability or
otherwise of any particular offer.
 Do not order negotiation on the repeated
advice of the tender committee to invite
fresh tenders, particularly where response
to the call for negotiations is poor.
 Do not accept modified offers, not
considered by the Tender Committee.
 Do not allow subsequent revision of the
minutes, unless the reconsidered minutes
are put up in addition.
 Do not record the acceptance/otherwise.
of the tenders anywhere else than the body
of the' Tender committee minutes - noting
side of the file is to endorse the action
taken only.
 Do not forget to explain "time delays" in
tender committee minutes.
CASE STUDIES
1 - Fraud In Purchase of Air Coolers
Zonal vigilance of a Rly. Have
uncovered a fraud committed by the user
and store department in purchase of air
coolers at much higher than reasonable /
market rates on the plea of urgency
because of onset of summer.
A senior subordinate initiated a non
stock requisition with Usha Shreeram or
similar makes with estimated cost of
Rs.6000/- each, based on budgetary
quotation of a local firm contd….
CASE STUDY - 1
1 . Fraud In Purchase of Air Coolers
The requisition was also signed by
divisional officer. In the DMM office, case
was processed giving tenders to four local
firms including one from which, budgetary
quotation had been taken. The user
Divisional officer certified the
reasonableness of rate. The purchase was
finalised within a week’s time.
CASE STUDY - 1
Fraud In Purchase of Air Coolers
OBSERVATIONS :
The desert coolers were available
under the DGS&D rate contract
The rate reasonability was given for
similar make, not the Usha Shreeram make
The coolers were purchased at the rate
which was 55% higher than the existing
market rate.
Neither user department nor DMM tried
to carry out market survey
CASE STUDY - 1
Fraud In Purchase of Air Coolers
ACTION :
DAR proceedings have been initiated
against indenting supervisor, divisional user
officer and DMM for involving joined hands
with an ulterior motive and non of them
took any action to safeguard the Rly.’s
interest.
CASE STUDY – 2
Fraudulent Delivery of Material By
Contractor
It was found that SSE / TRD recorded
fraudulent remark on challan as “the
material received in good condition and
taken in TB with page no. & signature.”
DEE / TRD had remarked in MB that
20% checked and certified.
CASE STUDY – 2
Fraudulent Delivery of Material By
Contractor
OBSERVATION :
Above remarks were made on Material
dispatched on 22/03/07 from Trivendrum
Material was not received at site
DEE / TRD made remark on MB without
verification of material at site
CASE STUDY – 2
Fraudulent Delivery of Material By
Contractor
ACTION :
SSE/TRD, DEE/TRD, SE /Tech., OS, were
prima facie found responsible for above
lapses and all the above are taken under
DAR action
The contractor was also found
responsible for indulging unethical trade
practice by claiming Rs.49.81 lakhs, which
was not delivered. Action is initiated to
blacklist the contractor.
Phase I - Module No. FC-10-ppt-1
Price of freedom is ETERNAL VIGILANCE

 Why?

 Is it right to be scared?

 Why you should not be


scared?

 Certain Precautions
Speaking Orders For Any Discretion Used
Stating All Facts And Circumstances.

 Do not forget to do this, as with time you‟ll


forget and it will be difficult to explain later
on if UNLUCKY.
 Personal matters: Land/ House, IPR,
Movable property, conduct rules etc.

 Examination/ Selection matters: Most


important.

 Official working: Tenders, contracts etc.


Follow all conduct rules

1. Movable Property- 2 x Basic Salary

2. Immovable Property – Pre Intimation of land/house


purchase.

3. Use of Official Vehicle, Telephone, Office


equipment

IPR: Immovable Property Return.


 Banned !!! Be very careful, Just Say A Big
No

 Gifts from Relatives etc.: No permission but


intimation is must for any gift above Rs
7000.

 EXACT WORDS IN NEXT SLIDE


(2) On occasions such as weddings, anniversaries,
funerals or religious functions, when the making of
gift is in conformity with the prevailing religious
and social practice, a Railway Servant may accept
gifts from his near relatives or from his personal
friends having no official dealings with him, but
shall make a report to the Government, if the value
of such gifts exceeds.
(i) rupees seven thousand in the case of a railway
servant holding any Group 'A' post;

(ii) rupees four thousand in the case of a railway servant


holding any Group 'B' post;

(iii) rupees two thousand in the case of a railway servant


holding any Group 'C' post;

(iv) rupees one thousand in the case of a railway servant


holding any Group 'D' post.
(3) In any other case, a Railway servant shall not accept any
gift without the sanction of the Government if the value
exceeds –

(i) rupees one thousand five hundred in the case of


railway servants holding any Group 'A' or Group
'B' post and

(ii) rupees five hundred in the case of railway servants


holding any Group 'C' or Group 'D' post.

Authority : Board Lr. No. E (D&A) 2004/GS 1-2 dated


15.3.2004.
Railway Ministry's decision: (2)

 Gifts received or given by a Railway servant in the


form of cash attract the provisions of the Rule even
though it is a transaction between father and son.

(No.E(D&A) 64 GS1-5 dt. 25.2.65)


Railway Ministry's decision: (3)

 Receipt of presents by Railway servants at the time of their


marriage in form of cash, ornaments, clothes or other
articles, otherwise than as consideration for marriage from
relatives and personal friends and others will be regulated
by the above Rule. Purchase of items of movable property
for giving presents at the time of marriage or on other
occasions will be regulated by Rule 18(3), like any other
transaction of movable property.
No.E(D&A)65 GSI-12 dt 23.4.66)
No.E(D&A)69 GSI-20 dt. 7.7.1970)
Railway Ministry's decision: (4)

 Making or acceptance of gifts amongst "Near


Relatives" which include father, mother, son, daughter
etc. requires the approval of the competent authority
in terms of sub-rule (5) above.
(1) Subject to the provisions of sub-rule (2), no Railway
servant shall, except with the previous sanction of the
Government.

(a) engage directly or indirectly in any trade or business,


or

(b) negotiate for, or undertake, any other employment, or

(c) hold an elective office, or canvas for a candidate or


candidates for an elective office, in anybody, whether
incor-porated or not, or
(d) canvas in support of any business of insurance agency,
commission agency, etc. owned or managed by any
member of his family; or

(e) take part except in the discharge of his official duties,


in the registration, promotion or management of any
bank or other company registered or required to be
regis-tered, under the Companies Act, 1956 (1 of 1956)
or any other law for the time being in force, or of any
co-operative society for commercial purposes.
(2) A railway servant may, without the previous sanction of
the Government

(a) undertake honorary work of a social or


charitable nature; or

(b) undertake occasional work of a literary, artistic


or scientific character; or

(c) participate in sports activities as an amateur, or


(d) take part in the registration, promotion or
management [not involving the holding of an elective
office] of a literary, scientific or charitable society or
of a club or similar organisation the aims or objects
of which relate to promotion of sports, cultural or
recreational activities, registered under the Societies
Registration Act, 1860 [21 of 1860], or any other law
for the time being in force, or,
(e) take part in the registration, promotion or
management (not involving the holding of an elective
office) of a co-operative society substantially for the
benefit of railway servants, registered under the Co-
operative Societies Act, 1912 (2 of 1912), or any other
law for the time being in force;
(3) Every railway servant shall report to the
Government if any member of his family is
engaged in a trade or business or owns or manages
an insurance agency or commission agency.

(4) Unless otherwise provided by general or special


orders of the Government no railway servant may
accept any fee for any work done by him for any
private or public body or any private person
without the sanction of the prescribed authority.
Railway Ministry's decision:1. It is not permissible for
a Railway servant to take an insurance agency in his own
name and canvass for the same.

o (No.E(D&A)58 GSI-40 dt.7.3.58)

Railway Ministry's decision:2 Railway servants should


not ordinarily be allowed to accept part-time employment
whether under Government or elsewhere, even though
such employment is after office hours.

o (No.E(D&A)58 GSI-29 dt.16.1.59)


Railway Ministry's decision: 3. Railway servants
holding recognized qualifications for any system of
medicine may be granted permission by the Heads of
Departments to undertake medical practice during spare
time, on a purely charitable basis without detriment to his
official duties. This will not apply to those who possess
the qualification and are employed as physicians,
surgeons etc. on the railways.

o(No.E(D&A)64 GSI-5, dt. 30-5-64 & 10.11.65)


Movable, Immovable and Valuable Property:

(i) Every railway servant shall on his first appointment to the


railway service submit a return of his assets and liabilities, in
such form as may be prescribed by the Government, giving
full particulars regarding?

(a) the immovable property inherited by him, owned or


acquired by him or held by him on lease or mortgage,
either in his own name or in the name of any member of
his family or in the name of any other person;
b. the shares, debentures and cash including bank
deposits inherited by him or similarly owned,
acquired, or held by him;

c. other movable property inherited by him or


similarly owned, acquired or held by him;

d. debts and other liabilities incurred by him directly


or indirectly.
(2) No railway servant shall, except with the previous
knowledge of the Government acquire or dispose of any
immova-ble property by lease, mortgage, purchase, sale, gift
or otherwise either in his own name or in the name of any
member of his family;
Provided that the previous sanction of the Government shall
be obtained by the Railway servant if any such transaction is
with a person having official dealings with him.

(3) Where a railway servant enters into a transaction in respect


of movable property either in his own name or in the name
of a member of his family, he shall, within one month from
the date of such transaction, report the same to the
Government, if the value of such property exceeds more
than twice the basic salary.
Explanation:I.
For the purpose of this rule, the expression "movable property"
includes –
(a) Jewellery, insurance policies the annual premium of which
is two times the basic salary, shares, securities and
debentures;
(b) All loans, whether secured or not, advanced or taken by
the Government servant.
(c) Motor Cars, Motor Cycles, horses or any other means of
conveyance; and
(d) Refrigerators, radios, radiograms and television sets.

(Authority ‐ Railway Board's letter No.


E(D&A)2011GS1‐3dated11.7.2011)acsno.118
How to intimate?
Railway Ministry's decision: 4. Whenever a Railway servant
wishes to build a house, the following procedure should be
followed :-

(a) Before starting construction of the house, he should report or seek


permission as the case may be and after com-pletion of the house,
he should report to the prescribed authority.

(b) The details in proforma prescribed should be furnished wherever it is


possible to do so. Wherever it is not possible to furnish the details
about purchase of movable property acquired for the construction
of the house the railway servant concerned should mention the
covered area on which the building is proposed to be erected and
the estimat-ed cost of the building.
(c) The provisions have been reviewed in the light of
amendments to Rule 18 of CCS (Conduct)Rules, 1964
carried out from time to time and it has been decided that in
respect of the expenditure incurred on repairs and minor
additions to an immovable property by a Government
Servant, an intimation shall be necessary to be given to the
prescribed authority only if the estimate exceeds Rs 10,000/-.
However, prior sanction of the prescribed authority should
be obtained in all cases regardless of amount involved,
where the transaction regarding the material purchased or
contract for such repairs or minor constructions, is with a
person with whom the Government servant concerned has
official dealings.
No. E(D&A)85 GS1-4 dt. 12-12-1985

1. Under Railway Board‟s letter No. E(D&A) 79GS1-5 dated 15-


06-1979 clarifications in regard to sub-rules 2&3 of Rule 18 of
the Conduct Rules were Communicated. As per these
clarifications, transactions entered into by the spouse or any
other member of the family of a Railway Servant out of his or
her own funds(including Stridhan, Gifts, inheritance etc.), as
distinct from the funds of the railway servant itself, in his or her
own right, would not attract the provisions of sub-rules (2)&(3)
of Rule 18 of the conduct rules.
2. With reference to the aforesaid clarifications, an apprehension
has been expressed that a railway servant could irregularly
acquire immovable/movable property with money received
from „dubious sources‟ but may not intimate such transactions
to the Government on the plea that the property was his wife‟s
property in which his funds have not been used.
3. It is not possible to place an obligation on the railway servants to inform or
seek permission for transactions entered into by the spouse or other
members of the family in their own right and from their own funds. This is
because sub-rules(2) & (3) of Rule 18 of the Conduct Rules are applicable
only to transactions made by Railway Servant in their own name, etc. and
not to those made by their spouse/family members exclusively in their own
right, from their own funds and it will , therefore, mean going beyond the
scope of the statutory rule if an obligation as aforesaid were to be placed.
It is , however, pointed out that if any case comes to notice where there are
grounds to suspect that the railway servant has illegally channelised his
own funds for a transaction in the name of some other person it is always
open to the Competent Authority to call for such explanation and to make
such investigations as may be necessary to establish the facts regarding the
resources used for raising the funds.
This is the Major source of trouble

REASONS

 Mistakes

 Over confidence

 Trying to be lenient as an after thought

 Trying to help the UNKNOWN, with the best of


intentions
Evaluation on lesser marks due to confusion in Max Marks
Correction in Type Test
Question not strictly objective

Not Objective

Not Objective
Question not strictly objective

Not Objective
Modification in Tabular Sheet
Marks actually 3 modified to 5 in
Tabular statement in (previous slide)
Corrections
Corrections
 Number of copies was very high.

 Time was less

 Too much load, working on 3 posts etc

 Was not well, and it was urgent

 Wanted to pass somebody on after thought.


RB letter No. E(NG)I-2008/PM1/18 dt. 13.02.2009

…..in the answers to objective type questions, no corrections of any type may
be permitted. In case any correction is made, that answer shall not be
evaluated at all. The correction may be any one of the following types (the
list is illustrative and not exhaustive):-
a) Cutting;
b) Overwriting;
c) Erasing;
d) Scoring off a ticked answer in multiple-choice and ticking another
answer; and,
e) Modifying the answer in any way.
RB letter No. E(NG)I-2008/PM1/18 dt. 13.02.2009

Para 2.1.

In partial modification of para 3.1. of this Ministry‟s letter No.E(NG)I-


2006/PM1/18 dt.30.08.2006 it is also clarified that the term objective type
questions will now include questions of the following types:
a) Multiple choice questions;
b) Answer in yes or no;
c) Fill in the blanks (maximum four words);
d) Match the following; and,
e) Any other type of question(s) for which answer is to be given in one
word/phrase.
 Many of the honest officers find themselves trapped in
cases related to Selection especially Copy Evaluation.

a. Do not make any corrections to the evaluation you


have done. It is just not permitted.

b. Do not evaluate any objective question which has


been cut and rewritten.

c. Do not evaluate any copy which has a distinct mark


on it.
d. Even a totalling error can be considered malafide,
thus utmost care be taken. Start the totalling from
reverse, use a rough sheet. Then re-total in the
forward direction. Now you must enter the marks on
top sheet.

e. Great care must be taken for questions with multiple


parts, the examinee often answers them at different
places and genuine errors occur in evaluation. With
RTI allowing access to the answer sheets such
mistakes have come to the fore and innocent Officers
have been in trouble.
f. There have been many cases where examinee has
answered more than the prescribed number of questions
and all the answers were evaluated. This is a serious
matter. For example, any 5 out of 8 and evaluation was
done for 6 questions. There is no check in the system
except for your own MIND.

g. The Paper setters are not professionals, they are amongst


us. Objective question are not strictly objective and the
full marks for each part are not consistent. All this can
lead to confusion. If a mistake is committed in such an
evaluation, then check whether it is consistent in all
copies and make necessary corrections.
Something about Contracts
Outsourcing of AC Coach Attendants
Your Opinion

Train Cost

Bandra Ter- Bhuj SayajiNagari 41.79 lakh

ADI- MCT Gujarat Mail 62.82 lakh

ADI Darbhanga, ADI- Varanasi 53.93 lakh

Total 158.54 lakh


Case – Inflated Initial Cost
 Contract for supplying and laying of S&T cables. 85%. Cost for
supply of cables and 15% for laying.

 MRP of cables taken for working out NIT cost. During tender
finalisation, reasonableness of rates justified based on NIT cost.

 There is 30-40% discount on MRP for bulk purchase of the


cables.

 The rates not compared with the prevailing Stores supply rates,
which were much lower.
Fraudulent Transportation Charges
 COS order for supply of cable to station X.

 Material was actually required at station Y very near


to the location of supplier.

 Material was actually taken at station Y from the firm.

 The same truck numbers were shown for delivering


the material at station X but they actually had gone on
the same date to Y.
 In a PU, a SAG level Stores Tender Committee recommended
100% order on Part II source quoting that the Part I source was
100% costlier. NO PROBLEM

 SAG level TC - Power upto Rs 3 crore (this was 5 years back)

 BUT: The offer of Part I was more than Rs 3 crore and the TC
mentioned this fact that since “it was higher than our power we
have not considered this offer.”

 TAA accepted the TC Minutes and PO was placed.

What is wrong?
 The Eligible offer decides the level of TC

 For any order more than 15% to Part II source,


GM‟s approval is must. This was not taken

 These officers were lucky, very lucky…, but you


may not be so fortunate, so be careful.
 Never make any amendments in conditions accepted
by TAA/TC however logical, simple etc. it may
seem without approval of TAA.

 Especially where some deliberation has been done


in TC Minutes but in final recommendation it was
missed or deliberately not written.
 Example: In one case a Hydraulic Unit worth Rs
10.5 lakh was ordered, some spares on as and when
required basis were quoted by the firm for Rs 1.25
lakhs and TC had agreed to consider, but in final
recommendations this aspect was ignored.

 TAA accepted this and PO was to be placed.


 The Dy CMM in his haste added this by pen on to the
recommendations without even telling this to TAA.
NO MALAFIDE INTENTION but serious
indiscipline.

 CVC recommended SF 11 both to Dy CMM and


SrAFA who vetted the PO. This was despite Local
Vigilance and Railway Board recommending that no
malafide intention was there.
 In first call, a tenderer was found eligible but the
tender was discharged as tenderer wanted to increase
rates in negotiations. In the second call, same
tenderer branded ineligible by the same TC.

 The work was for “RCC beam and columns, with


high roof”. The reason given for ineligibility was that
the work was for “loco shed”, whereas the work
completed by the tenderer was for “passenger
terminal”.
 The tenderer to whom work was awarded in 2nd
call, has completed a MEMU shed. On investigation,
this was found to be Steel Structure.
 Tender was called for deputing AC Coach Attendant
i.e. labour supply contract.

 The TC worked out “minimum workable tender


value” for the contract by taking minimum wages (as
per Labour Commissioner Rates) and adding
contributions towards PF and ESIC to it.
 The L-1 tenderer‟s offer was declared unworkable
as its‟ value was less than the “minimum workable
value”. Work awarded to L-2 tenderer.

 In this case, no contribution was required to be


made towards PF & ESIC. During execution,
contractor did not pay any such contributions.
• In a preventive check on Delhi division, it was found
that instead of the Assistant Material Manager
concerned, purchase tenders were being handled
directly by an officer of consuming department on the
basis of the office order issued by his controlling
Branch officer.

• Understandably, the authority for delegating such


power is vested only in the General Manager.

Not common, but a possibility


 Beneficiary of above event is firm, hence it can be
conducted that all these was done on firm‟s behest,
clearly indicate firm‟s wrong intention. Further, all of
LPO of firm was ordered to be re-checked for faults,
if any.

 Submitted for kind perusal & necessary orders so as


to set an example against such cheat.

 Be careful in words you choose while reporting cases.


Phase I - Module No. FC-10-ppt-2
Present Scenario
 Corruption found in all level
 Even Chief Executives Involved
 Inflated Estimate
 Arbitrary appointment of Consultants
 Stringent pre-qualification criteria
• Reduce competition, high rates, to favour firm
 Huge funds
• Vulnerable to corrupt practices
Problems Areas
• Administrative Approval
• Detailed Estimate & Technical Sanction
• Consultancy
• Tender Documents
• Invitation and Opening of Tenders
• Tender Scrutiny and Award of works
• Works Agreement
• Payment to Contractors
• Site Records
Administrative Approval
• Approval not obtained
– Misuse of Powers by subordinates
• Eg. Work carried out under variation to the
agreement.
• Inflated provisions in Abstract Estimate
– Margin for non-essential works
– Award at higher rates
• Major changes during execution
– Scope, specification changed
– High rate items are executed
Detailed Estimate & Technical
Sanction
• No drawings, details of measurement
– Arbitrary quantities
– Huge variations
• Repeated components in 2-3 items
• Consultant estimates
– Not checked
– Use of costly items
• Estimates at Higher LARs
Consultancy

• Problems
– No publicity
– Known firms. Old panel
– Higher fee
– Adhoc rates
– In-house facility available
– No punitive action
– Rates for Repetitive works not defined
– Paid services not rendered
– No check on plan, design, estimates, execution
Preparation of Tender
document
• No scrutiny and Approval
• Conflicting, vague & ambiguous conditions
– Disputes, delays and losses
• Stringent and ambiguous pre-qualification
criteria
– Less bidders, favourite firms, higher rates
• Old machineries
– Acquired before award of work
– No expenditure incurred by Contractor
Preparation of Tender
document contd…
• Splitting of bigger works
– Lower level Technical sanction
– Lower Level TC
• Use of brand
– Particular brand
• Favour manufacturer/supplier
Invitation and Opening of
Tenders
• Inadequate time
– Favored firms
– High rates
• Inadequate Publicity
– Very less circulation in news papers
– Not uploaded in websites
– Favoured few firms
Invitation and Opening of
Tenders contd…
• No Tender sale and opening Register
– For Fair & Transparent system
• Open at prescribed time, place
• Presence of Tenderers
• Rates to be read by Tender opening officer
• Corrections/omissions not numbered &
attested
– Possibility of Tampering of documents
• Rates not in words
– Tender opening authority should write in words
Invitation and Opening of
Tenders contd…
• Late/Delayed Tenders
– Not to be considered
• Maintain sanctity of Tender system
• Avoid malpractices
Tender Scrutiny and Award of works
• Credentials issued by private organisation
• Tenderers conditions
– Financial implications to be evaluated
• Delay in finalization
– Time and cost overrun
– Source of corruption
• L1 ignored on flimsy ground
– Favored contractor, high rates
Tender Scrutiny and Award of
works contd…
• Comparative statement not prepared or
checked
– Other than L1
• Reasonability of rates
• Tender accepted during 2nd call
– 1st instance discharged on flimsy ground
– Higher rates during 2nd call to favored firm
Tender Scrutiny and Award of
works contd…
• Items deleted after opening
– To alter L1
• No verification of credentials
– EMD mode not proper
– False credentials
Works Agreement

• Contract documents
– Not complete, not detailed
• Important papers missing
– Corrigendum to tender documents
• Performance guarantee not collected /
delayed
– Bank charges are saved by Contractor
Works Agreement cont…
• Labour license
– From Labour authority
– Saving of charges
• Technical staff
– Not employed/requisite number not employed
– Bad quality of work
Payment to contractors
• Excessive variations
– No competent approval
– Quantities advantageous to contractor
– Variation due to
• Inaccurate estimate
• Wrong/over measurement
• Abnormally low rate items
– To be identified
– Less execution to be avoided
– Substitution to be avoided
Payment to contractors contd…
• Items substituted
– Beneficial items to the contractors
– Exorbitant rates fixed
• Extra items
– Inadmissible but paid
– Exorbitant rates fixed
• Exorbitant rates for extra/new/substituted
items
• Measurements not in MB
Payment to contractors contd…

• Measurements books
– To be bound, numbered
– All to be recorded in MB
– To be test checked e.g. 20%
• Hidden items – 100%
• High rate items – to be test checked
Payment to contractors cotd…
• Recording of Measurements
– Under wrong item
– Under 2/3 items
• Accepted Rebates of contractor
– Not availed
• Security deposit/ Performance guarantee
– Released before due date
Site Records
• Labour register
– Daily presence of labour/supervisor
• Unnumbered registers
– All pages to be numbered
– Each page to be initialed by Officer
– Each transaction to be jointly signed by
contractor’s rep and Railway Engineer
– Cutting/overwriting to be avoided
• Inspection notes
– To be issued by Senior officers
– Compliance to be recorded
Case I
• Maintenance of Running Room contract in a
division
– Penalty clause for short deployment of manpower
against the stipulated 16 persons per day.
– In the billing period, there was short deployment of
manpower to the tune of 2300 men for a period of 334
days.
– No recoveries were made for short deployment of
man power in Bills
– The recoveries were made only in bill after the
intervention of vigilance.
PRIMARY UNITS, VARIOUS DEMANDS

Phase I - Module No. FC-10


FINANCIAL PRIMARY UNITS OF INDIAN
RAILWAYS

•EXPENDITURE ACCOUNTAL
•REVENUE EXPENDITURE
•WORKS EXPENDITURE
•EARNINGS ACCOUNTAL
ACCOUNTAL OF MONEY
1. HOW EARNINGS ARE ACCOUNTED FOR

COLLECTION AT MONEY IS SENT


THE TO THE CASH
STATIONS ETC. OFFICES

DEPOSITED AT
THE BANKS

BANKS ADVISE
RBI CREDITS (ADDS TO)
RBI-NAGPUR
THE RLY.’S ACCOUNT
ACCOUNTAL OF MONEY
2. HOW EXPENSES ARE ACCOUNTED FOR

CHEQUES ISSUED RBI/NGP DEBITS/REDUCES


BY RLY. RLY.’s ACCOUNT

CHEQUE ARE DEPOSITED


IN THEIR BANKS BY THE
PARTIES BANKS PAY TO
THE PARTIES AND ADVISE
RBI-NAGPUR.
FINANCIAL STRUCTURE OF RAILWAYS
AND
ITS RELATIONSHIP WITH THE GOVT. OF INDIA

EARNINGS CFI

BUDGETARY
ALLOCATION

REVENUE EXP. WORKS EXP.

VOTED AND CHARGED EXPENDITURE


Commercial Accounting
Para 201 of A-1

• Commercial Accounting is done in a manner


so as to show:
– How capital is utilized
– Position of debtors and creditors.
– Whether it is gaining or losing.
– The reasons for loss and gain.
– Whether it is solvent or insolvent.
Government Accounts
Para 201 of A-1

• The main requirement of government


accounting is to prepare a systematic
record of receipts and expenditure.
• Indian Railways are A DEPARTMENTAL
COMMERCIAL ENTERPRISE.
• Thus, we maintain accounts on commercial
basis as well as on the basis of
Government’s requirements and then link
the two through ―link accounts‖.
Para 202 & 205 of A-1

• The accounts of a Railway prepared as in a


commercial unit are known as ―Capital and
Revenue accounts‖.
• Accounts prepared for the Government are
called ― Finance Accounts‖.
• To facilitate the preparation of finance
accounts, a detailed structure of accounts
has been developed which synchronizes
with the Government of India’s Accounting.
CLASSIFICATION / STRUCTURE OF ACCOUNTS

WHAT IS IT?
A DETAILED SCHEME OF RECORDING ACCOUNTS

NEED FOR IT?


INFORMATION FOR MEANINGFUL PRESENTATION

HELPS ANALYSIS

•ENABLES - DECISIONS BASED ON

COMPARISONS
COST CONTROLS
BUDGETING
FORECASTS
REVENUE EXPENDITURE

•DEFINITION
•COMPONENTS
ORDINARY WORKING EXPENSES (Para 324 of F-1)
APPROPRIATION TO FUNDS
OTHERS.
FROM WHERE DO WE GET MONEY FOR
REVENUE EXPENSES?
• Relevant References ( Page 1 & 2 of A-2 & Para 701 of F-1)
S. Group Dem- Demand
N and Name of demand
No.
I Policy Formulation and 1. Railway Board
Services common to 2. Miscellaneous Expenditure (General)
all Railways
II General 3. General Superintendence and Services on Railways
Superintendence and
Services on Railways
III Repairs and 4. Repairs and Maintenance of Permanent Way and Works.
Maintenance 5. Repairs and Maintenance of Motive Power.
6. Repairs and Maintenance of C & W.
7. Repairs and Maintenance of plant and equipment.
IV Operation 8. Operating Expenses – Rolling stock and equipment.
9. Operating Expenses – Traffic
10. Operating Expenses - Fuel
V Staff Welfare, 11. Staff Welfare and Amenities.
Retirement Benefits 12. Miscellaneous Working Expenses.
and Miscellaneous 13. Provident Fund, Pension and other retirement benefits.
VI Railway Funds and 14. Appropriation to Funds.
payment of General 15. Dividend to General Revenues, Repayment of loans
Revenues taken from General Revenues and Amortization of over
Capitalization
DEMANDS FOR GRANTS
1. Railway Board FROM
2. Miscellaneous expenditure 3 TO 13
3. RAILWAY ADMINISTRATION OWE .
(Demands 4,5,6,7 are for Repairs and Maintenance)
4. BUILDINGS & TRACKS FROM
5. LOCOMOTIVES 3 TO 14
6. CARRIAGES TWE
7. PLANTS & EQUIPMENTS
(Demands 8,9,10 are for operations) FROM
8. ROLLING STOCK 1 TO 15
9. TRAFFIC DEPARTMENT REVENUE
10. FUEL EXP
11. STAFF WELFARE
12. MISCELLANEOUS EXPENSES. FROM
13. PF, Pension & other retirement benefits. 1 TO 16
14. Appropriation to funds. TOTAL
15. Dividend, Repayment of loan etc. EXP
SUB- DIVISIONS OF REVENUE DEMANDS

DEMAND NO

MINOR HEAD MINOR HEAD MINOR HEAD

SUB HEAD SUB HEAD SUB HEAD

DETAILED HEAD DETAILED HEAD DETAILED HEAD DETAILED HEAD


EACH DEMAND IS DIVIDED INTO :

MINOR HEAD
SUB HEAD
DETAILED HEAD
PRIMARY UNIT
EXAMPLE OF REVENUE EXPENDITURE
CLASSIFICATION :
04 B 223 32

ABSTRACT
DEMAND No. DETAILED HEAD PRIMARY UNIT
CLASSIFICATION OF WORKS EXP.

• PLAN HEAD (i.e.minor head)


– Sub Head
– Detailed Head

2114 --PROCUREMENT OF ELECTRIC LOCOMOTIVE

2100—(Plan Head)-Rolling Stock

2110 (Sub Head)-Locomotives

2114(Detailed Head) –Electric


WORKS EXPENDITURE
DEFINITION
• Rules for classification of expenditure under the
various heads are given in chapter 7 of F-1
• FROM WHERE DO WE GET MONEY FOR WORKS
EXPENDITURE.
DRF
REVENUE
DF
SURPLUS CAPITAL FUND
(NOW DEFUNCT)
RECPT. FROM
CENTRAL
ROAD FUND RSF
LOAN FROM
EXCHEQUER CAPITAL AT CHARGE
ONE TIME GRANT + CESS ON FARES = SRSF
MISC. RECEIPTS OLWR
WHILE GIVING ALLOCATION OF WORKS
EXPENDITURE
WE GIVE

SOURCES OF FINANCE CAPITAL,,DRF,


DF, SRSF etc.
&
THEIR APPLICATIONS

PLAN HEAD:
e.g. DOUBLING,
S&T ETC.
CAPITAL AT CHARGE
It is a loan given by General Exchequer through Central
Government’s Budget for which, Railways
have to pay interest (which is termed as Dividend in railways,
current rate is 6.5%)

In 2005-2006, an amount of Rs 6,244 Cr is projected

RAILWAY SAFETY FUND

This fund is to be used for


Plan Head 29 i.e,. Level Crossings and
Plan Head 30, i,e, ROBs, RUBs
In 2005-2006, appropriation of Rs 714 Cr. and
withdrawals of Rs 711 Cr. are expected
DRF (DEPRECIATION RESERVE FUND)

• STARTED FROM 1.4.1924


• PROVIDES FOR COST OF REPLACEMENT
OF ASSETS.
• AMOUNT ON THE BASIS OF RCC’s
RECOMMENDATIONS.
• SUBJECT TO VOTE OF PARLIAMENT
• FOR 2005-2006 Appropriation to DRF has
been Budgeted at Rs.3604 Crores and
withdrawal from the fund is projected to
be Rs 2650 Crores..
DF (DEVELOPMENT FUND)

• STARTED IN 1946---- BETTERMENT FUND AND


RENAMED AS DF FROM 1.4.1950.
• IT HAS 4 COMPONENTS
• DF I PASSENGER AMENITIES
• DF II LABOUR WELFARE
• DF III UNREMUNERATIVE WORKS FOR
OPERATIONAL EFFICIENCY
• DF IV SAFETY WORKS
• The appropriation to and withdrawal from the fund
for the year 2005-2006 are projected at Rs. 1853
Crores. and Rs 1200 crores respectively.
CAPITAL FUND

• CREATED IN 1992-93
• EXCESS AFTER APPROPRIATION TO DF IS
CREDITED TO THIS.
• WITH A VIEW TO CREATE
INFRASTRUCTURE FROM INTERNAL
RESOURCES.
• CURRENTLY NOT IN USE
SRSF (Special Railway Safety Fund)
(Works Shown in Green Book)

• Latest fund on the recommendations of Khanna


committee- RSRC 1998.
• Funded by one time grant of Rs. 12,000 crores
from GOI and Rs. 5,000 crores from collection of
safety surcharge on passengers.
• Fixed tenure of 6 years.
• FOR 2005-2006 Appropriation to and withdrawals
from SRSF have both been budgeted at Rs.3522
Crores
OLWR (OPEN LINE WORKS REVENUE)

• FOR SMALL VALUE WORKS, OTHERWISE


CHARGEABE TO DF, THIS SOURCE IS
USED.
• THIS IS NOT A FUND AND HENCE NO
BALANCE IS CARRIED FORWARD AT THE
END OF THE YEAR.
• IN THE BUDGET OF 2005-06, AMOUNT OF
Rs. 45 CRORES IS PROJECTED.
RULES OF ALLOCATION OF EARNINGS

ABSTRACT X -

COACHING EARNINGS: PASSENGER FARES, LUGGAGE


CHARGES, PARCEL COLLECTIONS, LIVE STOCK BY
PASSENGER TRAINS ETC.

ABSTRACT Y -

EARNINGS FROM GOODS TRAFFIC, GENERAL


MERCHANDISE, COAL, FERTILIZERS, LIVESTOCK BY
GOODS TRAINS, TRANSHIPMENT CHARGES ETC.
ABSTRACT Z

SUNDRY OTHER EARNINGS,


COLLECTION OF RETIRING
ROOM CHARGES, RECEIPTS
FROM CATERING DEPT., SALE
PROCEEDS OF TREES AND
GRASS ON LINE, RENT OF
PLOTS GIVEN TO OUTSIDERS,
TELEGRAPH EARNINGS ETC.
Rolling Stock
Programme
BY
CAMTECH - GWALIOR
Phase I - Module No. FC-10-ppt1
Structure of the Course
- What is RSP?
- Different types of funds for RSP.
- Railway-wise and Prod.Unit-wise allocation of
funds RSP.
- Timing for submission of works to HQs & Rly
Board.
- Role of Mechanical Directors of RB.
- Details of D&G charges.
- Analysis of RSP Works appearing in Pink Book.
- Tips for inclusion of Works RSP (Freight ,
Coaching, Diesel Shed , Workshop).
ROLLING STOCK PROGRAMME FOR 2016-17
NEW ACQUISITION
Works Costing Below Rs. 2.50 crores
Locomotives
Particulars Allocation Anticipated Cost
Turbo Super Charger - 01 nos. CAP 7500
MTA Complete assembly for WDG4- 01 CAP 16000
Co-Co bogie frame for three phase WAG9H locos for ELW/BSL – 02
nos @Rs.7.40 lac each. DRF 1480
Carriages
SupplyofRoofmountedACpackageunitconfirmingtoRDSO spec. for
RMPU and control unit. Qty 07 Nos. DRF 4530
Replacementofoveragedinverter25KVAinverterofRMPU type AC
coaches Qty 10 Nos. DRF 4987
ROLLING STOCK ON IR
( As on 31.3.2007)

Loco Km. Aprox.


LOCOMOTIVES Diesel 4816
8153 Electric 3294

COACHES 38896
DMUs/DHMUs 692
EMUs 5762
Other coaching 5905
WAGONS 207719
BDT CRANES *
Key Indicators
• Route Km 63327
• BG 49820
• MG 10621
• NG 2886
• Electrified route km 17786
• STATIONS 6909
• FREIGHT 661 MTs
• PASSENGERS CARRIED 5725 Millions
What is RSP?

Annual RSP is a follow up of the Five


Year Plans, formulated for IR in respect
of acquisition of rolling stock.

Provision of new rolling stock in RSP is


made at least 3 years in advance for
Locos and 2 years in advance for
wagons and coaches.
What is RSP?

Provision of replacement of rolling stock in


RSP is arrived at by projecting the likely
condemnation in the period for which the
Plan is made.
The Codal life of a Rolling Stock is
mentioned in the “Indian Railways Code for
the Mechanical Department Workshops)”.
Codal life of a rolling stock (for its
replacement in RSP) is not the maximum
economic life and with good maintenance,
stock can be kept in service for many years
longer.
What is RSP?

• ENABLING PROVISION TO SPEND MONEY


FOR ROLLING STOCK MANUFACTURE,
MODIFICATIONS & SPARES

• BULK RSP & ITEMISED RSP

• VERY IMPORTANT CONSIDERING THAT


REVENUE BUDGET IS REDUCING
EXAMPLE OF RSP (Programmed Funds)
CAP DRF BOND TOTAL
Loco 13.92 51.24 1823.33 1888.49
Carriages 140.07 499.21 942.46 1581.74
Wagon 20.40 194.18 1247.58 1462.16
Cranes 467.02 467.02
Rail cars & 131.31 156.61 287.92
Multiple units
Track 290.99 290.99
Machines
TOTAL EXAMPLE RSP IN Rs Crores

CAP 517.23

DRF 1157.77

DF(1) 14.80

WIS (Wagon 500.00


Investment Scheme)
BOND 4170.00
RSP works

WP M&P RSP
Already Works in Programmed Programme
sanctioned programmes Deliveries/ d Deliveries
by Board WIP Works in
programmes
New Works New Works New New
Acquisition Acquisition

[ M&P : All funds of Allocation : Cap. DRF, DF ]


RSP (New Acquisition)

CAP DRF DF(1) WIS


Loco ---.--
Carriages --.-- --.-- --.--

Wagon --.-- ---.--

Cranes
Rail cars &
Multiple units
Track
Machines
BULK RSP
• ROLLING PROGRAMME FOR 3 YEARS
• INITIATED BY CONCERNED DIRECTORATES
IN RLY BOARD BASED ON CSP, UPGRADED
DESIGNS, RDSO RECOMMENDATIONS ETC.
• FOR MODIFICATIONS & CAPITAL SPARES
• PROCESSED BY DME/PU & DRS/W
• PLANNING & TRAFFIC DEPARTMENTS ARE
INVOLVED IN NEW ROLLING STOCK
• APPROVED BY BOARD
• APPEARS IN PB AS RAILWAY BOARD RSP
• ITEMS LISTED IN PINK BOOK
BULK RSP

• LISTED IN ORDER OF SANCTION


• PD CARRIED OVER – LOCO, CARRIAGE,
WAGONS, CRANES, RAIL CARS & MUs, TMs
• NA NEWLY SANCTIONED-L, C, W, CR, TM
• COST, SPENT, OUTLAY, BALANCE
• ITEMS REMAIN TILL COMPLETED EVEN UPTO
10 YEARS
• CAN’T SPEND WITHOUT PARLIAMENT
APPROVAL
• TO PROCESS INDENTS ADVANCE ADVICE
SENT IN NOV.
BULK RSP

• Based on the total budget available for


RSP, targets for workshops ( both for PD
and NA) are fixed by DME(P)I based on
the annual requirement, projection of
Railway, capacity and past performance
of workshop.

• Targets advised on the date of Railway


Budget so that railways can process for
materials / tenders in advance.
BULK RSP
• Once the Budget is passed, authority to
spend under RSP is issued by Budget
Dte.

• Based on the progress made in RSP work


as well as request of railways, targets can
be re-appropriated between railways.

• Re-appropriation between different items


requires finance concurrence of Board.
BULK RSP
• Based on the Budget Estimates of the
next year, an Advance RSP programme is
issued in October for all PD (already
sanctioned) items of PB.

• This is to expedite the process of


tendering and to bring them up to the
stage of release of Purchase Order.
ITEMISED RSP

• Proposals to be sent by railways / PUs by


15th September

• Up to 50 lakhs sanctioned by Director with


Director Fin. Stores

• Beyond 50 lakhs to MR

• Lump sum in Pink Book, advised by


DME/PU
ITEMISED RSP
• Diesel Loco items processed by DME/Traction

• C&W items processed by DME(P)I

• Cranes & ART/ARME items processed by


DME(P)II

• Electric Loco items processed by DEE/RS

• Train lighting & AC items processed by DEE/G

• Track Machines & Camping coaches items


processed by Director / TM
Sanctioning authority for WP, M&P, RSP
WP M&P RSP Sanctioning
authority

> 100 Crs Expanded


Board

>30 lacs & < 100 Crs Full Full Min of Rlys, RB

15-30 lacs < 10 lacs Nil GM


< 15 lacs Nil Nil DRM

All RSPs are to be approved by Railway Board irrespective of cost.

[ M&P : All funds of Allocation : Cap., DRF, DF1, DF2, DF3]


Board RSP (Loco) works in PB ---.--
1. Rehabilitation of NG Diesel Locos
2. Provision of LED based flasher light on locos @
0.12 lacs per loco
3. Provision of twin beam sealed headlight
4. Provision of automatic switching flasher light
5. Modification of roller suspension bearing for
traction motors.
6. Provision of Air driers on Locos
7. Modification of driving cab
8. Procurement of speed recorders.
9. Procurement of wheel flange lubricators
10. Procurement of electronic fuel injection kit.
11. Retro fitment of centrifuges on locos.
12. Reconditioning of 120 T crane
Board RSP (Coaches) works in PB
1. Refurbishing of coaches during POH
2. Conversion of MG coaches into MG DMUs
3. Conversion of condemned coached into NMG vans
4. Conversion of ART stock to Air brake
5. Fitment of SS Trough floor in coaches /EMUs
6. Retrofitment of bogie mounted air brakes (BMBC)
7. Retrofitment of bogies with air suspension in EMUs
8. Mid-life rehabilitation of coaches.
9. Provision of enhanced capacity screw couplers and
draft gears
10. Provision of corrosion resistance water tank in
coaches.
11. Provision of Emergency exit windows
Board RSP (Wagons) works in PB
1. Conversion of tank wagon from plain bearing
to roller bearing

2. Retrofitment of casnub bogies and air brake


systems on BCX wagons.

3. Retrofitment of high capacity draft gear

4. Complete renewal flooring , end wall , and side


wall on BOXN wagon

5. Retrofitment of existing air brake stock by high


speed bogies.
Example of Itemized RSP works in PB
CENTRAL RAILWAY
( >50 lacs)
• Replacement of 4 Cracked Tri-mount Co-Co Bogies
• Procurement of 4 Co-Co bogies with Brake Rigging
• Power pack for 3100 HP Loco (2 No.)
• Procurement of Conversion kit from 6 CD 4 UC to 6CD
3UC compressors-35 Nos
EASTERN RAILWAY
• Procurement of Conversion kit from 6 CD 4 UC to 6CD
3UC compressors-40 Nos
• onversion of Narrow Gauge GS Coaches (10 Nos.)
• 3 Nos. 20T Dsl. Crane ( for ER)
• 3 Nos. 20 T Dsl. Crane ( for NR)
• 4 Nos. 20 T Dsl. Crane ( for CR)
• Bogie complete with axle for 140 t Crane
• Capital spares parts one of each type for 140 T Crane.
• 1 No. 20 T Dsl. Crane ( for Kota W/S)
• 4 Nos. 20 T Dsl. Crane ( for ER)
• 21 Nos. 140 T Dsl. Cranes.
RSP works in PB ( >50 lacs)
NORTHERN RAILWAY
1. DPC Bogie complete of DEMU (2 Nos.)
2. 25 Nos. NG/GS Coaches
3. Manufacture of 8 NG Coaches
4. Power pack ( with traction alternator) for WDP2 16 Cyl. At
WDM2C, TKD
5. Power pack (W/o TG) of WDM2C for CB
6. Power Pack for HHP DMU for SSB
7. Replacement of 2 ART, Allahabad

NORTH EASTERN RLY


1. GE type split pole excitation sys. For YDM 4 Locos.
2. Replacement of conventional coaches for ART/ARME
3. 5 Nos. Passenger coaches for ART
4. Power pack ( with traction alternator ) for Gonda
RSP works in PB ( >50 lacs)
NORTH-EAST FRONTIER RAILWAY
1. Conversion of GE control Sys. To BHEL Sys. For YDM4
2. Manufacture of new Coaches
SOURTHERN RAILWAY
1. Main engine Crank shaft for WDM2 ( 7 Nos.)
2. Supply of 251 Plus Cylinder Head assembly
3. DEMU Conversion Kits (2 Nos.)
SOUTH CENTRAL RAILWAY
1. 3100 hp Turbo super charger for 5 WDG2 Locos, Gooty
SOUTH EASTERN RAILWAY
1. Manufacture at NG Coaches (25 Nos.)
2. Power pack complete for 3100 HP Loco (1 No.)
3. Turbo Chargers ( 3100 HP) :( 6 Nos.)
WESTERN RAILWAY
1. Replacement of 8 T steam Crane by 10 T Diesel Crane
No. of RSP works in Pink Book 2003-04
For Example
Rly Loco Carriage Wagon Cranes Total
Ele. Mech Ele. Mech Ele. Mech Ele. Mech Ele. Mech
CR 6 1 3 - - 2 - 2 9 5
ER 8 - 9 1 - - - 8 17 9
NR 4 3 1 4 - - - - 5 7
NE - 2 1 2 - - - - 1 4
NF - 1 - 1 - - - - 0 2
SR 8 2 7 1 - - - - 15 3
SCR 4 1 2 - - - - - 6 1
SER 12 2 6 1 - - - - 18 3
WR 6 - 5 - - - - 1 11 1
48 12 34 10 0 2 0 11 82 35
Rolling Stock Programme for 2016-17
Railway / Rs. in Crores Railway / Rs. in Crores
Board Board
CR (PH 21) 2.5 Metro 2.4387
ER 30.2632 ECR 2.5
NR 14 E Co.R 11.23
NE 03 NW -
NF 03 NC -
SR 18 SEC -
SC 8 SWR -
SE 19 WCR 0.14
WR 07 Board RSP 3523 *
PUs NIL Total 3623
* includes 2970 Crs. BOND, Cap: Rs. 292 Crs, DRF: Rs. 361 Crs
Total number of Board RSP works = 558
OBSERVATIONS - BULK RSP
• BUDGET DECIDED ON PREVIOUS YEAR
• RLYS EXPECTED TO SEND IN BE STAGE &
POH PLAN (CAPACITY OF SHOPS)
• ITEMS LISTED IN PB – STILL RLYS DON’T
ASK
• REQUEST FROM RLY SPECIALLY FOR C&W
RSP ITEMS LESS THAN MONEY AVAILABLE
• PROGRESS NOT SATISFACTORY (IS IT
MONITORED ?)
• MORE PRESSURE FOR REGULAR OUTTURN
OBSERVATIONS - ITEMISED RSP
• PROPOSALS COME AFTER NOV. GIVING
INSUFFICIENT TIME TO PREPARE
• KEEP COMING LATER
• OUT OF TURN VERY DIFFICULT
• NOT ARRANGED IN ORDER, DIRECTORS TO
PICK
• VARIATIONS IN COSTS – JUSTIFY COST
• BETTER JUSTIFICATIONS – SAFETY, RDSO
(WE DON’T GET TIME)
• BULK RSP ITEMS FIGURE
OBSERVATIONS - BOTH
• BUDGET DECIDED ON PREVIOUS YEAR
• SPENDING LESS TILL RE STAGE
• DEBITS RECEIVED ONLY 60-70 %
• BALANCE PRACTICALLY LAPSES SINCE
NO MECHANISM TO CROSS-CHECK
• GMs HAVE PRACTICALLY NO POWER IN
RSP
Phase I - Module No. FC-10-ppt2
M&P

 An M&P is equipment costing above Rs one


lakh.
 Prior sanction of competent authority is
required before initiating procurement action
by placing an indent.

2
M&P Programme

Mechanical Department Coordinates the


M&P programmes
at all levels on Indian Railways

3
M&P Programme

 The M&P proposals are processed 1 year in


advance
 The M&P proposal have to be initiated by the
respective dept.
 A Time Table for sending the proposal is
issued by Mechanical Dept.of Railway Board.
 Rly.Bd. advises Zonal railways the limit of the
fund for M&P programme
4
Model Time Frame
 Proposals to be sent to Board
- Submission to Divisional Accounts: 30th April
- Submission of Vetted Proposals to PHODs: 15th May
- Submission of consolidated proposals by PHODs to
CME/Planning: 31st May
-Submission of M&P Programme to FA&CAO:15thJuly
- Submission of M&P Programme to Board: 21st
September

5
Model Time Frame

 Proposals under GM’s Powers


- Vetted proposals should reach PHODs by 31st
January.
- PHODs should submit consolidated proposals
(In order of priority) to CME/PLG by 20th
February.

6
M&P Programme

 Limit of fund allotment is generally based on


 Funds utilized last year
 No. of machines likely to condemned

 Machines falling due replacements during


the current year.
 Machines under commissioning

 Expansion plan
 Any extra work load in near future

7
M&P Programme

 Mechanical Department distributes these


funds to various departments.

 Normally 20% of the funds allotted may be


utilized under head capital .

8
PROCUREMENT OF MACHINES IS UNDER PLAN HEAD
4100 DEMAND NO. 16

ALLOCATION
• DF-I Passenger amenity
• DF-II Staff welfare
• DF-III Operating improvement
• DF-IV Safety

9
Framing of Proposal

Justification
 Technical Justification
 Financial Justification

10
Framing of Proposal
Technical Justification
M&P proposed should clearly specify the
machinery being replaced, its age, its codal
life, its present condition and a justification for
its replacement.
(Codal life Para 219 Indian Railway finance code
along with advance correction slip no. 65 vide R.Bd
letter no 2002/AC-II/1/10 dated 12.10.07)

11
Framing of Proposal
Technical Justification
 Full details of jobs required to be machined should be
furnished.
 M&P Proposal should be based on “System
Approach” and should lead to improvement in the
output in a particular section.
 Items of M&P already included in the “Works
Program” should not be included in the M&P program

12
Framing of Proposal
Technical Justification
 Material handling equipment where proposed,
should indicate the labour saving to be achieved
 One to one replacement should not be sought
automatically.
 The latest version of the machine with higher
productivity should be planned

13
Framing of Proposal
Technical Justification
The inescapability of procurement should be
established.

The justification as to why the machine can not be


reconditioned

14
Framing of Proposal
Financial Justification
All proposal must be furnished with financial
justification.
The cost should include:
 Cost of foundation,

 D&G charges,

 Electrical work ,

 Tooling etc.

 Extra manpower cost

 Contingency

 Civil works like rooms,fencing,crane

structure, doors etc 15


Framing of Proposal
Financial Justification
For items under head “Capital” a rate of return
(ROR) of 14% has to be shown. ROR is not
required for machine essentially required for
safety considerations (ROR under DCF
technique: IRFC vol. 1 para 229)

16
Elements of cost of M&P
1) Basic cost of Machine =
2) Electric connection charges (as per estimate) =
3) Foundation charges (as per estimate) =
4) Freight (if know actual or maximum
3% for COS procured machine only) =
5) D&G charges 4.99% as per Board’s letter
No. 2000/E&R/400/2 Dt. 12/10/2000 =
6) Contingency (Maximum 3% if required) =
7) Other charges if any =

Total: XYZ =
17
Admissible D&G
(Board letter 2007/M(W)/964/66 dated 23.8.2007)
In M&P Program: 4.99%

COFMOW COS
Mech: 2.7 3.6
COFMOW-1.49 Store-0.59
A/c 0.40 0.40
Admissible D&G
(Board letter 2007/E&R/400/2 dated 12.10.2000)

In Works Program, for Mechanical department:


0.326% of D&G of Civil Estimate
Framing of Proposal
The cost of the item should be assessed
realistically by
 By correspondence with likely suppliers of that
item.
 By referring to price catalogue of manufacturers
 By corresponding with other railway units
 Through Internet

20
Framing of Proposal
 The proposal for inclusion in M&P programme
to be sent to Electrical Department duly vetted
by Finance and approved by HOD.

 Normally each department should limit its


proposal within limit but in no case should
exceed 10% of allotment.
21
Framing of Proposal
Item costing above Rs.1 Crore requires Boards prior
permission for inclusion in M&P Programme.

No T & P item should be included in the M&P


program.

Wherever M&P items are proposed to be included in


pursuance of Railway Board’s directives, copies of
relevant directives to be enclosed with the proposal
22
Sanction of M&P Proposals

•All such proposal consolidated by Mech. Dept. & after


approval by CME sent to Board.

•A coordination meeting is held by Railway Board to


discuss these proposals with CEE(Plg.) of individual
Railways.

•Finally Railway Board frames a consolidated M&P


proposal which is given to Finance Directorate for inclusion
in Budget proposal of Ministry of Railways.
23
Sanction of M&P Proposals
 Revalidation of sanction is required in case the
machine is not procured in 5 years of sanction. Such
machines should be planned which can be procured
within 2-3 years.
 After passing of Railway Budget, sanction of M&P
programme is received by each zonal Railway from the
Board.
 Railway Board also communicates sanction of lump
sum fund for M&P items to be procured under GM’s
power.
24
Sanctioning Authority

 Railway Board
 Machines costing above Rs. 10 Lakhs
( 2000/m(M&P)/1063/NA/AL 14.07.00)
 All road vehicles except staff cars.
 Staff cars are sanctioned by the establishment directorate
for which separate proposals are to be sent as individual
items. However, funds are to be allotted from PH-4100.

25
Sanctioning Authority

 GM’s Powers
 Machines costing not more than Rs. 10 Lakhs
 Rs. 15 Lakhs for Electronic in-motion
weighbridges (2002/M(M&P)/814/1 14.10.04)
 Sanction of M&Ps up to 3 times funds allotted
for the year, validity remains for 2 years (97
M(M&P)/1063/NA/AL 04/09/98). Ceiling limit
is also given every year.
26
Vehicle Vs Staff car

Staff car Life 7 years Vehicle Life 10 years


GM All others
AGM
PHOD
SDGM
CHOD
DRM

27
Sanction of M&P Proposals

 Based on the sanction a detailed estimate is made


which must be vetted by finance and sanctioned
by competent authority.

 An indent for the items to be procured should now


be placed on store for procurement.

28
Items under GM’s Power

 Since items are generally small, no detailed


estimate is prepared and indent can be
placed for procurement of equipment.

 Sanction for M&P under GM power lapses


after two years.

29
Procurement Agency

 Procurement of all major and important items of


M&Ps will be the responsibility of COFMOW costing
more than Rs 5 lakh.
 Procurement of medical equipment is made through
COS irrespective of cost.
(2004/M(M&P)/1063/NA/AL 03.09.2004)

30
Specification

While framing specification, advancement in


technology and current & future workload
should be kept in mind.
Important dimensions, sizes, layout, capacities

Function to be performed, scope of work, time


frame, quantity/day or shift, quality.
List of spares, consumables, warranty,
inspection agency should be included in the
specifications
31
Specification of M&P

Specification should be so framed so that M&P item


can be procured only from reputed and reliable
manufacturer.
Specification should be prepared based on
• Information from different machine
suppliers
• Machine catalogues
• Internet
• Similar machines by other units
• Actual requirement vs workload
• Technology available
Specification to be signed by In-charge of Unit. 32
Documents for procurement:
1. Estimate

2. Indent (Name of equipment should be same as per


sanction.)

3. Specifications

4. Check List

Note: Funds certification is given by CME/Planning.


33
Following points should also be kept in mind
while finalizing the M&P program.

 Training requirement
 Maintenance manuals
 Spares requirement
 Software Program back ups
 Availability of spares for next 10 years

34
Following points should also be kept in mind
while finalizing the M&P program.
 Foundation details be be furnished by the firm
 Electrical Power requirement
 Any crane requirement
 Water, air supply to be provided to the
machine
 Provision to be made for custom duty,
insurance etc.
35
Committee on Issues of M&P
Rly Board’s letter No, 98/RS(G)/709/1 dated 30.5.3006
(Members COS/COFMOW, FA&CAO/COFMOW & CME/DLW).

Following modification may be incorporated in the


tender condition for procurement of M&P.
1.Elements of Freight For Indigenous Purchase
• For more than four consignee , tenderer to quote for FOR station
of dispatch prices with average freight for all consignee, which
will be added to FOR station for dispatch price to get FOR
destination price.
• For four or less consignee, tenderers to quote FOR station of
dispatch price with actual freight for each individual consignee
which will be added to FOR station of dispatch price to get FOR
destination price for each individual consingee. 36
Committee on Issues of M&P
..contd
2. Timely Commissioning of M&P
• In the case of failure of contractors to commissioned M&P by the
time specified in the contract, purchaser may recover as penalty
A sum @ 2% of the price of the M&P for each and every

month during which M&P may not have been commissioned.


The penalty is subjected to an upper limit of 10% of contract

value.

37
Committee on Issues of M&P
..contd
3. Warranty
•Warranty period for M&P will be 24 months from the date of
commissioning. Maximum period of two weeks will be allowed
for attending and rectification of faults during the warranty period.
•Maximum down time during the warranty period will be
2% for on line M&P

10% for off line M&P

calculated on quarterly basis.

38
Committee on Issues of M&P
..contd
3. Warranty ---contd.

•Penalty of 0.5% per week of the contract value will be levied for
delay in response time for attending and rectification of faults
beyond specified time during warranty period.

•Maximum penalty to be levied on account of warranty failure will


be 5% of the contract value calculated during whole of warranty
period. After this purchaser is entitled for encashment of WG
Bonds.

39
Committee on Issues of M&P
..contd
4. Annual Maintenance Contract.
•Tenderers are required to quote for post warranty Annual
Maintenance for a period of 5 years, after expiry of warranty
period alongwith the offers.
•Tenderers will mention AMC schedule of such Annual periodic
maintenance alongwith offers giving the charges for AMC
maintenance schedule and other details of item to be used in such
preventive maintenance.
•For the purpose of comparative evaluation all charges on AMC
alongwith items to be used in preventive maintenance will be
included in the FOR destination place quoted for M&P. 40
Committee on Issues of M&P
4.
..contd
Annual Maintenance Contract.---contd
• Tenderers will also give cost of essential spares and service
charges for each items of work of repair of M&P outside
preventive maintenance contract. These charges will not be
included in the price of M&P for the purpose of comparative
evaluation of offers.
• The terms and conditions of AMC must clearly specify the
maximum down time and maximum response time.
• Tenderers who are OEM, must give undertaking for supply of
spare parts for a period of expected life of the machine/
equipment. Other tenderers must submit undertaking from OEM
for supply of spare parts for a period of expected life of the
machine/ equipment. 41
Committee on Issues of M&P
..contd

5. Inspection
• Inspection of M&P items will be carried by M/s.RITES

42
M&P PORTAL
•To assist the creation of proposal and their subsequent
processing, a web based system for creating M&P proposal
has been developed.
•It provides necessary formats, instructions and guidelines
for creation of proposal.
•Latest COFMOW compendium has been integrated into
the portal.
•This is a secure system with password access for each field
and head of its user.
•Address of the portal is http://www.irmnp.com
44
M&P Condemnation
•Condemnation is for
•New but not useful/ serviceable
•Outlived its Codal life
(There is no codal life laid down for
Medical equipment)
•Under repair
•Accidented
45
M&P Condemnation
•M&P condemnation is done through Survey
committee
•For each division there is standing Survey
committee
•After acceptance of the Survey committee
report by CME, M&P condemnation
Memorandum is issued
46
M&P Disposal
•An Advice note (DS-8) is prepared and
submitted to Stores depot for disposal.

47
WORKS PROGRAMME

Phase I - Module No. FC-10-ppt3


WORKS PROGRAMME
• WHY?
– Scarce Resources
– INVESTMENT PLANNING
• Expenditure on New Assets/Improvement
• Non-revenue
INVESTMENT PLANNING

• Income-Expenditure=Gross Surplus
• Gross surplus- provision for
depreciation(DRF)
• = Net surplus
• = Investment.
• Must be in useful form- “Productive
investment”
• At least 10% Annual rate of return
Dividend

• When the investment is financed out of


government funds it is said to be charged
to capital

• @ 7% on dividend paying capital.

• Increase of dividend liability


Disposable Surplus
• Surplus after payment of dividend

• Credited to the development fund(DF)

• And to Capital fund.

• Capital fund(CF) is used for works chargeable


to capital.
Development Fund
• DF1
– To finance expenditure on passenger and
other Railway Users Amenity works
• DF2
– Staff Welfare works
• DF3
– Un-remunerative operating Improvements
• DF4
– Safety works
Depreciation reserve fund
(DRF)

• For Replacement of asset originally


created out of Capital or DF
Demands for Grants
• Estimate of expenditure from consolidated
fund included in Budget statement.
• Demands for Grants-16 types
• Demands 1 to 15 dealing with Revenue
Expenses.
• Demand 16 dealing with Works expenditure i.e.
Creation, Acquisition and Replacement of
assets.
Railways investment plan For
Demand 16

• Presented along with Railways budget.


• As Annual “Work, Machinery, &
Rolling Stock Programme.
• Called “Pink Book”
Stages of Investment Planning

• Formulation of schemes
– Advance planning
• Preparation of Preliminary Works
Programme
• Discussion With Rly Bd
• Submission of Final Works Programme
WORKS PROGRAMME

The budget allotment for Open Line Works during a financial


year are based on the Works Programme for execution and
approved by the Railway Board, the Railway Administration
therefore submits every year to the Railway Board, in the
first week of September, the Works Programme (Other than
Plant, Machinery and Rolling Stock) for the ensuing financial
year. This is termed as preliminary Works Programme.
The works programme may be submitted as under:-

Volume I – Works in progress including works approved in earlier


years but estimates for which have not been sanctioned by
30th June, of the year previous to the programme year.
Volume II – New works and also works falling under “D” category
i.e. works approved in earlier years which have not actually been
commenced and on which no expenditure has been incurred till
30th June, of the year previous to the Programme year.
Volume III – Track renewal works – Works in progress as well
as new works, and
Volume IV – Annexures and alphabetical index
WORKS PROGRAMME
The Programme for Open line works, chargeable to Capital,
depreciation Reserve Fund (DRF), Development Fund (DF), and
open Line Works (OLWR) and ACSPF is prepared category
wise separately for each Plan Head, depending upon the cost of
the work as explained in Para 3 below. Railway Board’s letter
No. 69-B-4144-Main dated 14th January 1970 lays down that the
various works should be grouped under the following four
Categories:-
1. Works in progress I.e. works approved previously.
2. Works approved in earlier years which have not actually
been commenced and on which no expenditure has been
incurred till 30th June of the year previous to the Programme
year.
3. New works I.e. works proposed to be undertaken.
PROCEDURE FOR INCLUDING
WORKS IN WORKS PROGRAMME
1. Terms used:-
1.1 Mixed works – A mixed work means a work in which more
than one department’s work is involved. For instance, provision
of a crossing station is a mixed work containing Civil Engineering
and S&T portion work.
1.2 Sponsoring department – Sponsoring Department which
feels the need for a work and justifies the work. For instance,
for a line capacity work, the Operating Department is the
sponsoring department.
1.3 Controlling department:- Controlling department is the
Department which controls the major portion of the expenditure
Of a mixed work and co-ordinates the work pertaining to other
Departments. For instance, in the case of yard remodelling work,
The Engineering department is the controlling department, as
It co-ordinate the work relating to other departments, viz.
Signal & Interlocking and Electrical. In the case of purely
Signalling and Interlocking works, the S&T Departments is the
Controlling department, which co-ordinates the work of Civil
Engineering and Electrical Departments. Similarly, the major
Portion of this work consists of Machinery, C.M.E. will control
The work, coordinating with C.E. and C.E.E. for Civil &
Electrical portion of the work and so on for all departments.
SELECTION OF WORKS TO BE INCLUDED IN
THE PRELIMINARY WORKS PROGRAMME

List of works in form “A” showing rough and tentative cost of


works to be included in the Preliminary works programme will
be sent by all the heads of departments to the Chief Engineer
by 31st January. The G.M. will then convene a meeting for
discussion and selection of works to be included in the
Preliminary Works Programme. This meeting will be arranged
in the month of February, so as to give enough time for the
development of the works, checking their feasibility and
rough cost in time.
Formulation of schemes

• By Whom
– Divisional Works- Division
– Major Works- HQ
– Covering two Railways- Railway having
major portion.
Important requirement
– Full Details, Justification, Detailed plans &
Estimate
– ROR-Financially Justification- Project
Evaluation
– Cost of project- Break up after full
investigation
– Investment Schedule
– Look as a whole- Entire Scheme
Format of PWP

– Vol.I- Works in progress,


• Works sanctioned-fund allotted categorized as
works in progress for next year
– Vol. II- New Works other then track works
– Vol.III- Track works
– Vol.IV- Annexure
Annexure
Information on
• Works approved in earlier years but not
actually commenced- no expenditure incurred
till 30th June of the year previous to plan year

• Works approved in earlier years but estimate


has not sanctioned till 30th June of the year
previous to plan year
• Groups
– > Rs. 50 Lakhs
– > Rs. 30 lakhs < 50 lakhs
– Upto Rs. 30 lakhs- L.S. Provision is indicated
Preparation of
Preliminery Works Programme

• Within financial limits given by Board


• Process starts 14-15 months in advance of
plan year,
• Jan/Feb when PCE writes inviting
proposals for next plan year
FINAL WORKS PROGRAMME
• WP meeting is fixed by Rly Bd in
Oct./Nov.
• Discussion at Railway Board - GM &
PHODs
• Board’s decisions
• Modifications to PWP & submission as
FWP by December
Work Machinery & Rolling
Stock Program
• Board consolidates all proposal and
schemes from Railways.
• Present these in the form of a
“Work,Machinery & Rolling Stock
Program” to parliament along with
Budget.
• Known as Pink Book
Pink Book

• Itemized for works costing above Rs. 50


Lakhs and

• L.S. Provision - for works upto Rs. 50


Lakhs.
Itemized at GM’s level

• Works upto Rs. 30 lakhs –


• L.S.grant for works upto Rs. 5 lakhs for
Divisions.
LIST OF PLAN HEADS

• 11. New lines ( Construction)


• 12. Purchase of New Lines.
• 13. Restoration of dismantled lines.
• 14. Gauge conversion
• 15.Doubling.
• 16. Traffic facilities yard remodeling & others.
• 17. Computerization
• 20. Rolling Stock.
• 31.Track Renewals.
• 32.Bridge work.
• 33.Signaling & Telecommunication
Works.

• 34. Taking over of line wires from P&T


Deptt.

• 35. Electrification projects.

• 36. Other Electrical works.


• 41. Machinery and Plant.

• 42. Workshops including production units.

• 51. Staff Quarters.

• 52. Amenities for Staff.*


52. Amenities for Staff

• 1. Provision of new Hospital ,


Dispensaries and additions, alterations,
and improvements to existing ones.

• 4. Provision and improvements to health


and welfare works and maternity centers.
• 6. Provisions and improvements of
sanitation, water supply, road
lighting and water facilities in
railway colonies.
• 8.Any other works to provide
amenities for staff.
• 53. (I) Passenger Amenities.
• (ii) Other Railway users amenities.
• 61. Investment in Govt. Commercial
undertakings- road services.
• 62. Investment in Govt. Commercial
undertakings- Public undertakings.
• 64. Other specified works.
• 71. Stores suspense.
• 72. Manufacturing suspense.
• 73. Miscellaneous Advances.
• 80. Metropolitan Transport Projects.
Phase I - Module No. FC-10
IMPREST

 Para 1050 of F1 defines imprest as a standing advance


of a fixed sum of money, placed at the disposal of an
individual, for meeting the following types of
expenditure:

1. Petty office expenses


2. Cost of raw material for diet of indoor patients
3. Emergent charges which cannot be foreseen
4. Other petty expenses (This is an indicative list)
 Para 1051 – Amount not to be larger than what is
absolutely necessary, to be fixed in consultation with
Accounts.

 Para 1052 – Imprest is granted by GM or other


competent authority, as per SOP.

 Para 1053 – Number of imprests should be minimum.


An officer holding imprest should meet the needs of
subordinates also. Such officer, however, is responsible
for the imprest.

 Para 1054 – Imprest can be inspected at any time.


Certain important features:-
 Imprest is a Suspense (intermediate) account.

 Expenditure is booked to the final head, later.

i) Revolving in nature.

ii) Subject to post-check by Accounts.

iii) To be spent only for the purpose for which it is


created.

iv) Should be reviewed periodically for reduction,


surrender etc.

v) Instead of multiple imprests, consolidate.


LOCAL PURCHASE

• Purchase without tender

• COS empowered upto 1 lakh

• Power of COS may be re-delegated

• Other Officers like DRM also empowered

• Single quotation

• Payment may be through cash imprest


• Para 701–S: Agency of Stores Department is used in
ordering the supply of all stores required for the use of
Railways. COS is the officer entrusted with this
responsibility.

• Para 711–S: COS is given powers of local purchase of


items of small value for both stock and non-stock
categories up to Rs 50,000 per item subject to fulfillment
of conditions in this para. (as per the Board’s circular no.
2001/F(S)-L/PW7/2 dated 5.9.2003).
 Ceiling limit to invite single quotation for Local
Purchase is Rs. 2000 for each item.

 These powers may be re-delegated to Depot Stores

 Officers / Divisional Stores Officers, in consultation


with FA&CAO.

 Consumer department should make an indent, give


specifications, probable sources and last purchase
particulars, if any, get fund Certification send the indent
to DCOS/ACOS.
• For Local purchase of stock items, out-of-stock
certificate is required from the depot.

• Generally, DCOS has a trade group wise list of


suppliers. Inquiries are sent by him by means of
bulletin or otherwise.
 On receipt and opening of the quotations, following
points need to be checked out:-

i) Technical suitability.

ii) Rate reasonability.

iii) Market trend.

iv) That the description is not slightly changed just to


meet the requirements; viz. length/weight etc.

v) That there is no splitting


• Copies of the Purchase Order are sent to the
supplier, consignee, bill passing authority,
Accounts.

• Accounts will do internal check before making


payment.
STAGES
OF
Railway Budget
Phase I - Module No. FC-10
What does one mean by
“Budget?”

2
BUDGET
 Chartered Institute of Management Accountants
(CIMA), London, defines Budget as

‘A financial and / or a quantitative statement,

prepared prior to a defined period of time,

of the policy to be pursued during that period,

for the purpose of attaining given objective/s.’

3
Contd..
A budget, thus, is a precise statement
of financial and quantitative implications
of the course of action that
Management has decided to follow in
the immediate next period of time
(usually a year).

4
Types of Budget:
Concepts in brief

 Historical / trend based or incremental


Budget.
 Zero Base Budget
 Performance cum outcome Budget.

5
Budget- Constitutional
Background
 Three organs of the State
 Legislature (Parliament, Assemblies)
 Executive
 Judiciary

Independent Constitutional Functionaries like C&AG

Voted & Charged expenditure, as parts of various


Demands

6
Budget – contd.
 Annual Financial Statement (AFS) i.e. an
estimate of Receipts and Expenditure for the
year.
 Article 112(1) : AFS should be laid before
both Houses of Parliament for consideration
and sanction of voted portion.
 Charged expenditure, Appropriations
sanctioned by President.
 It is also a Management Document.

7
Presentation to Parliament

 Recommendations of President under Art


113(3) of the Constitution essential before
presenting the Budget to Parliament.
 The complete set of budget papers
containing detailed estimates of each
Railway along with summary, presented to
Parliament.

8
Presentation of budget

 Review of the preceding year’s performance,


 Actuals of receipt & expenditure for the part of the
year and trend for remaining period of the current
year.
 Proposals for revising requirement of the current
year (Revised Estimates).
 Estimates of receipts and expenditure of the
coming year (Budget Estimates)

9
Approval by Parliament

 Budget is a Money Bill.


 After presentation of Budget in Parliament,
it is reviewed by Standing Committee
(Estimates Committee).
 After Budget is passed by Parliament and
given assent to by President, and after the
appropriation act is also passed, funds
become available to Railway Board.

10
Approval by Parliament – contd.

Budget orders in 2 stages for FY14 -15


 On account allotment for April to July (as

per Art. 116 of the Constitution)


 and full Budget allotment thereafter

11
Budgetary Reviews
• Budgetary Reviews Monthly, Quarterly
- Budget Control Statement
 Budget Proportion for the month
 Actuals for the month
 Budget Proportion up to the month
(cumulative)
 Actuals for the month (cumulative)
 Remarks / reasons for variations
 Use of Exchequer control mechanism

12
Revision to Grants

 Changes in Budget
 Supplementary grants
 Re-appropriation

13
contd.

 August Review – First week of Sept.


 Revised Estimate – First Week of Dec.
 Budget Estimate
(for the next year) – First Week of Dec.
 Final modification – Latest by 21st Feb
 Continue monitoring – March

14
Railway Budget:

Structure & Compilation Levels

 Department Wise
 Demand wise
 Primary Units (object of exp.) wise
 Divisions/workshops
 Zonal HQs
 Railway Board

15
Revenue Budget
 Revenue Budget: For maintenance
and operation of services to generate
business and meet other charges and
appropriations (provisions / debt
servicing etc.)
 Short term (One year)
 Demand no 1 to 15

16
Revenue Budget--contd
Abstr Dema Name of Demand
act nd
1 Railway Board

2 Miscellaneous Expenditure(General)
A 3 General Superintendence and Services on
Railways
B 4 Repairs and Maintenance of Permanent Way and
Works
C 5 Repairs and Maintenance of Motive Power
D 6 Repairs and Maintenance of Carriages and
Wagons 17
Revenue Budget--contd

E 7 Repairs and Maintenance of Plant and


Equipment
F 8 Operating Expenses-Rolling stock and
equipment
G 9 Operating Expenses-Traffic

H 10 Operating Expenses-Fuel

J 11 Staff Welfare and Amenities

K 12 Miscellaneous Working expenses 18


Revenue Budget--contd

L 13 Provident Fund,Pension and other Retirement


Benefits
M 14 Appropriation to Funds
15 Dividend to General Revenues, Repayment of
loans taken from General Revenues and
Amortization of over capitalisation

19
Primary Units
(Objects of Expenditure)

01 Salaries and Wages


02 Dearness Pay and Dearness Allowance
03 Productivity Linked Bonus
04 House Rent allowances
05 Compensatory (City) Allowances
06 Interim Relief
08 Railway’s contribution to NPS
09 Wages of Casual Labour
10 Kilometre allowance
11 Overtime allowance

20
Primary Units--contd
12 Night duty allowances
13 Other allowances
14 Fees and honoraria
15 Transfer allowance
16 Travelling expenses
17 Air Travel Expenses sanctioned in lieu of
privilege passes
18 Office expenses
19 Rental for P&T telephone and call charges
including Trunk calls
20 Leave Encashment During the service
21 Advertising expenses
21
Primary Units--contd
22 Utilities
23 Rental for office equipment(other than Data
Processing)
24 Printing and stationery including Publications
25 Children Education Allowance
27 Cost of materials from stock
28 Cost of materials-Direct purchase
32 Contractual payments
33 Transfer of debits

22
Primary Units--contd
36 Excise duty paid/payable for purchase of
materials
37 Customs duty paid/payable for purchase of
materials.
38 Sales Tax paid/payable for purchase of
materials.
39 Air Travel (Domestic)
40 Air Travel (Foreign)
99 Other expenses.

23
Capital Budget
 For creating/acquiring New Assets to
build additional capacity and for
replacement / renewal of over-aged
assets
 Works, M&P, RSP Budget under
different Plan Heads of Demand
number 16.

24
Capital Budget
 Works, Machinery and Rolling stock
programme called Pink Book.
 Chief Engineer co-ordinates works program
 Chief Mechanical Engineer co-ordinates the
Machinery and Plant Program.
 Rolling Stock co-ordinated by Railway Board
through CME.

25
Source of Funds for Capital
expenditure
 External-
 From GOI- Capital at Charge

 Internal –
 Depreciation Reserve Fund for replacement
 Development Fund for non-remunerative
operational improvements, welfare works etc.
 Capital Fund for creating new assets which are
remunerative.

26
Non- Budgetary Sources for Capital
Expenditure.
 Market borrowings through IRFC to finance
RSP, M&P items on lease basis.
Others
 PPP
 National Rail Vikas Yojana projects through
Rail Vikas Nigam Ltd. .

27
Capital Exp: Plan Heads
Plan Name Plan Name
Head Head
s s

11 New Lines 12 Purchase of new


lines

13 Restoration of dismantled 14 Gauge


lines conversion

15 Doubling 16 Traffic facilities,


yard remodelling

28
–contd.
Plan Name Plan Name
Hea Hea
ds ds
17 Computerization 18 Railway Research

21 Rolling stock 29 Road Safety


22 Leased assets payment Works-level
of Capital Component crossing
30 Road Safety works-Road 31 Track renewals
Over/under bridges
29
–contd.

32 Bridge works 33 Signalling and


Telecomm works
34 Taking over line wires 35 Electrification projects
from P&T dept

36 Other electr. excl TRD 41 Machinery and Plant


37 Traction Distribution
42 Workshops 51 Staff Quarters
incl.Prod.units

30
–contd.
52 Amenities for staff 53 Passengers amenities

62 Inv.in Govt. 64 Other Specified works


Comm.undertaking

71 Stores Suspense 72 Manufacture suspense

73 Miscellaneous 81 Metropolitan Transport


advances projects

31
Primary Units (Objects) of Expenditure for
Works

1 Pay& allowances of Departmental 01


Establishment
2 Payment to Casual Labour 02

3 Payment to contractors and others for 03


Engineering works or supply and erection
contracts etc.

4 Direct supply of material 04

32
Primary Units (Objects)Expenditure for
Works-contd.

5 Stores supplied from stock 05

6 Freight on stores 06

7 Credits for released material 07

8 Others 08

9 Transfer of debits/credits affecting 09


capital works expenditure/suspense
accounts

33
Primary Units (Objects)Expenditure for
Works-contd.
10 Productivity Linked Bonus 10

11 Excise duty paid/payable for 11


purchase of materials
12 Custom Duty “ 12
13 Sales Tax “ 13
14 Interim Relief 14
15 Travelling Expenses 15
16 Air Travel(Domestic) 16
17 Air Travel(Foreign) 17
34
Earnings Budget
 How about approval for Earnings?

 Estimates of Earnings by taking into account-


 Originating earnings and Apportioned Earnings.
 This includes Adjustments with other Railways and other
Govt. departments.
 Physical parameters
 Passenger originating, passenger kilometres, lead
 Loading in million tonnes, NTKM, lead
 Realization of dues from sundry debtors(Power houses etc.

35
Earnings Budget-contd
 Prepared by CCM of the Zonal Railway.
 Prepared separately for passenger, other
coaching, goods earnings.
 Sundry earnings- estimates prepared by
accounts based on information submitted by
commercial and engineering branches.

36
Earnings Budget - contd
 Estimates for passenger and goods traffic
prepared separately under the headings
“originating”, “received” and “carried” and
then totalled.
 The detailed working sheet under passenger
traffic, other coaching traffic and goods traffic
detailed under the above headings are sent
to the Traffic Accounts office.

37
Accountal of Earnings
 Classification
 Abstract ”X” - Earnings from Coaching traffic
 Abstract “Y” - Earnings from Goods traffic
 Abstract “Z” - Sundry other earnings.

38
Parliament’s control
 CAG
 PAC

39