QUESTION BANK WITH ANSWER - GROUP ‘B’ AMM ( Stores) Part II
86. Write a short note on Canons of Financial Propriety.
Ans Canons of Financial Propriety are general rules which have been framed for the guidance of the Government officials who are entrusted with financial powers and who are authorized to incur, or sanction expenditure from Public Moneys. These are stated below:
(i) The expenditure should not prima facie be more than the occasion demands, and that every government servant should exercise the same vigilance in respect of expenditure incurred from public moneys as a person of ordinary prudence would exercise in respect of the expenditure of his own money.
(ii) No authority should exercise its powers of sanctioning expenditure to pass an order which will be directly or indirectly to its own advantage.
(iii) Public money should not be utilized for the benefit of aparticular person or section of the community, unless:
(a) the amount or expenditure involved is insignificant, or
(b) a claim for the amount could be enforced in a court of law, or
(c) the expenditure is in pursuance of a recognized policy or custom.
(iv) The amount of allowances, such as travelling allowances, granted to meet expenditure of a particular type, should be so regulated that the allowances are not on the whole sources of profit to the recipients.
Note: All proposals involving financial implications except those which have been specifically exempted for this purpose should be referred to finance branch for advice before these are sanctioned.
87. What is the relevance of Canons of Financial Propriety in the day to day working of Stores department?
Ans Stores department is entrusted with the Material Management functions of the Railways. Large expenditure is incurred by Stores department for acquisition of assets, and their stocking, preservation and issue to the user departments. In keeping with the principles elucidated in Para
Ans Stores department is entrusted with the Material Management functions of the Railways. Large expenditure is incurred by Stores department for acquisition of assets, and their stocking, preservation and issue to the user departments. In keeping with the principles elucidated in Para
(i) of Canons of Financial Propriety, the purchase officers should follow the 5 essential principles of purchasing i.e. procurement of Right Quality, RightQuantity, Right Price, Right Place/Time and Right Source. This will ensure that there is no wasteful expenditure on account of obsolescence, deterioration, unnecessary handling and movement, blockage of funds in excess inventory, blockage of space etc. Stores department enters into contracts with various agencies for supply and transportation of materials, and for disposal of scrap. To comply with the Para
(ii) of Canons of Financial Propriety the officials entrusted with the powers to enter into such contracts should ensure that they do not have any financial interest in the agencies to whom such contracts are awarded so that they do not, directly or indirectly get benefited by such transactions. Para
iii.of Canons of Financial Propriety warrants that the conditions incorporated in the tenders for procurement of materials are fair and transparent, and do not favour any of the prospective bidders. To meet the requirement of Para iv of Canons of Financial Propriety it has to be ensured that officials are deputed for jobs after properly assessing the requirement so that the expenditure on allowances are kept at bare minimum and wasteful expenditure is avoided.
iii.of Canons of Financial Propriety warrants that the conditions incorporated in the tenders for procurement of materials are fair and transparent, and do not favour any of the prospective bidders. To meet the requirement of Para iv of Canons of Financial Propriety it has to be ensured that officials are deputed for jobs after properly assessing the requirement so that the expenditure on allowances are kept at bare minimum and wasteful expenditure is avoided.
88. State the objectives of Stores department?
Ans The objectives of Stores department are as under:
- To Procure materials at lowest price, consistent with desired quality
- To assess the needs of various departments in respect of materials in a scientific manner based on the past consumption pattern, and interaction with the user departments etc.
- To maintain continuity of supply, preventing interruption of the flow of materials to the users
- To develop reliable alternate sources of supply to promote a competitive atmosphere in performance and pricing and to maintain satisfactory "buyer-vendor" relationship
- To ensure proper receipt, inspection, stocking, issue and accountal of stock items
- To maintain a high inventory turnover, by reducing excess storage, inventory carrying costs and inventory losses occurring due to deteriorations, obsolescence and pilferage
- To dispose of the scrap generated in the process of production, maintenance and repair works, and other obsolete and unserviceable materials after proper survey and valuation
- To promote standardization and variety reduction with a view to ensure consistent quality at optimum cost
- To implement such programmes like value analysis, cost analysis and make or buy decisions, with a view to reduce costs
89. Describe the functions of Controller of Stores
Ans The functions of Controller of Stores are as following:
i. It is his responsibility to administer and control the working of stores department.
ii. It is his duty to ascertain the needs of a railway in the matter of materials and stores and of arranging for the supply of such materials and stores in the most efficient, economical and expeditious manner possible
iii. All Stocks of stores on hand, whether with the Stores Department or other departments of the Railway, represent funds that are not productive. Controller of Stores is responsible for ensuring that while stocks should be such that stores required by the railway are readily available, they should be as small as possible, and losses due to obsolescence or deterioration should be the minimum practicable.
iv. He is responsible for receipt, inspection and distribution of materials to the various stores depots, for their custody while in-charge of the stores department and finally for their issue on requisitions received from authorised officials of the railway.
v. It is his responsibility to issue and maintain upto-date a Nomenclaturecum-Price List including all items of stores in stock in the Stores Depots.
vi. His duties include maintenance of numerical records of stores in stock and to the preparation of the initial documents of receipt and issue.
vii. The Controller of Stores should arrange for submission to him of such statements and returns as may be necessary to keep him informed of the stocks available in his depots, the manner in which the requisitions of the departments are being complied with, the inflow of materials not required by departments and the steps taken to dispose of surplus and unserviceable stores.
viii. He is in-charge of inventory control.
ix. All materials and stores for which the consuming departments have no immediate use should be returned to the Stores Depots, the Controller of Stores being responsible for their survey and valuation, and for disposal by sale or otherwise. He has also to deal with all the surplus, and unserviceable material of the railway.
90. Describe the organizational structure of Stores department at Rly. Boardlevel, and the activities that are undertaken at this level.
Ans Rly. Board Store department is headed by Additional Member (Railway Stores), who directly reports to Member Mechanical, Railway Board.
AM(RS) is responsible for policy making as well as procurement of those items which are reserved for procurement at Rly. Board. He is assisted by various Executive directors (EDs) for the following Purchase/other activities. -
EDRS (G) Policy matters related to Procurement and stocking of Stores, Inventory Management, Budget allocation under suspense head, Co-ordination with DGS&D in conclusion of Rate Contracts and other related Railway Matters. MMIS, E-Procurement etc., All Policy Matters related to printing & printing presses. -
EDRS (S) Procurement of Wagons and Procurement of Steel (for wagon building & Rlys.). -
EDRS(P) Import of complete rolling stock, Accident Relief Cranes and R/C for spares of stock, Indigenous procurement of Wheels, Tyres & Axles and Man Power Planning. -
EDRS (C) Procurement of Petroleum, Oils& Lubricants, Procurement Policies of Textiles, Disposal of Scrap, e-auction.
EDRSs are in turn assisted by Directors, Deputy Directors, Assistant Directors and relevant sections’ staff.
AM(RS) is responsible for policy making as well as procurement of those items which are reserved for procurement at Rly. Board. He is assisted by various Executive directors (EDs) for the following Purchase/other activities. -
EDRS (G) Policy matters related to Procurement and stocking of Stores, Inventory Management, Budget allocation under suspense head, Co-ordination with DGS&D in conclusion of Rate Contracts and other related Railway Matters. MMIS, E-Procurement etc., All Policy Matters related to printing & printing presses. -
EDRS (S) Procurement of Wagons and Procurement of Steel (for wagon building & Rlys.). -
EDRS(P) Import of complete rolling stock, Accident Relief Cranes and R/C for spares of stock, Indigenous procurement of Wheels, Tyres & Axles and Man Power Planning. -
EDRS (C) Procurement of Petroleum, Oils& Lubricants, Procurement Policies of Textiles, Disposal of Scrap, e-auction.
EDRSs are in turn assisted by Directors, Deputy Directors, Assistant Directors and relevant sections’ staff.
91. Describe the organizational structure of Stores department at Zonal Railway level, and the activities that are undertaken at this level.
Ans Stores department of the zonal railway is headed by Controller of Stores, who directly reports to the General Manager of Railway. Controller of Stores is responsible for planning and purchase, receipt, stocking, accountal (numerical) and issue of stores, Inventory control, Vendor registration/ development, Survey/Valuation/Disposal of scrap and other unserviceable materials etc.
Controller of Stores is assisted by CMM’s, who are entrusted with the responsibilities of different purchase sections and general sections. The purchase sections as well as general sections
(vendor registration, inventory control, budget, computer, tender opening, e-procurement etc.) are headed by Section in-charges, who report to Controller of Stores through the respective AMMs, SMMs, Dy.CMMs and CMMs. There areGeneral Stores depots located all over the railways which are also under the administrative control of Controller of Stores. These Stores depots are normally headed by a Dy.CMM, who is assisted by SMMs and AMMs.
These depots are responsible for Receipt, Stocking, Accountal and Issue of materials, Scrap sale etc. and have various sections/wards like Receipt Section, Inspection Ward, Stocking Wards, Despatch Sections, Ledger Section, Progress Section, Scrap Yard etc. which are all headed by a Section in-charge, who report to the depot in-charge. The depot inchargereports to the Controller of Stores through the respective CMMs in the Headquarters.
In addition to the General Stores depots, there are depots attached with the Railway workshops and Diesel/Electric sheds, which are under the administrative control of the heads of the respective Workshops/Sheds. These cater to the needs of the Workshops/Sheds in respect of materials. These depots are normally headed by a SMM/AMM.
Similarly, the each Division has a Stores organization, normally headed by a Dy.CMM who is under the administrative control of the DRM. The divisional stores officer is in-charge of the divisional stores depot (available is some divisions only), and is responsible for coordination with the Headquarters’ Stores office for items in short supply, for local purchase of urgent/small value items, for disposal of low value scrap, and for drawl of uniforms from the nominated General Stores depot and distribution of the same to the various branches of the division.
Controller of Stores is assisted by CMM’s, who are entrusted with the responsibilities of different purchase sections and general sections. The purchase sections as well as general sections
(vendor registration, inventory control, budget, computer, tender opening, e-procurement etc.) are headed by Section in-charges, who report to Controller of Stores through the respective AMMs, SMMs, Dy.CMMs and CMMs. There areGeneral Stores depots located all over the railways which are also under the administrative control of Controller of Stores. These Stores depots are normally headed by a Dy.CMM, who is assisted by SMMs and AMMs.
These depots are responsible for Receipt, Stocking, Accountal and Issue of materials, Scrap sale etc. and have various sections/wards like Receipt Section, Inspection Ward, Stocking Wards, Despatch Sections, Ledger Section, Progress Section, Scrap Yard etc. which are all headed by a Section in-charge, who report to the depot in-charge. The depot inchargereports to the Controller of Stores through the respective CMMs in the Headquarters.
In addition to the General Stores depots, there are depots attached with the Railway workshops and Diesel/Electric sheds, which are under the administrative control of the heads of the respective Workshops/Sheds. These cater to the needs of the Workshops/Sheds in respect of materials. These depots are normally headed by a SMM/AMM.
Similarly, the each Division has a Stores organization, normally headed by a Dy.CMM who is under the administrative control of the DRM. The divisional stores officer is in-charge of the divisional stores depot (available is some divisions only), and is responsible for coordination with the Headquarters’ Stores office for items in short supply, for local purchase of urgent/small value items, for disposal of low value scrap, and for drawl of uniforms from the nominated General Stores depot and distribution of the same to the various branches of the division.
92. Describe in brief role of the following organizations in regard to purchases of material by NC Railway.
(1) RITES,
(ii) DGS&D,
(iii) NSIC,
(iv) CRIS,
(v) COFMOW
(1) RITES,
(ii) DGS&D,
(iii) NSIC,
(iv) CRIS,
(v) COFMOW
Answer:
(i) RITES:
(i) RITES:
Quality Assurance Division of RITES provides services for third party inspection of materials & equipments against purchase orders placed by NC Railway. The inspection services of RITES are backed by in house laboratory facilities providing technical support. As per the existing instructions of Railway Board, RITES carry out third part inspection of materials & equipment against purchase orders having value more than Rs. One lakh. The QA division of RITES has been divided in five regions i.e. Central, Northern, Southern, Western & Eastern region with clearly defined jurisdiction. After placement of purchase order by the railway, the vendor is required to submit inspection call in the regional office of RITES, in the jurisdiction of which the firm is located. The inspection is carried out by RITES inspecting engineer at firm’s premises. After the material is passed and inspection certificate is issued by RITES, the vendor can dispatch the material. In case the consignee rejects the material which was pre inspected by RITES, a representative of RITES associates in the joint inspection with consignee and the firm’s representative.
(ii) DGS&D:
Directorate General of Supplies & Disposal is a central purchase & Quality Assurance organization of Govt. of India, department of supply, ministry of commerce. It renders procurement services to central & state governments by placing rate contracts for common use items. Items which are required to be procured through DGS&D have been given in Appendix VI of Stores Code vol-I. These items have been categorized under various groups such as building materials, pipe fittings, hardware, furniture, crockery, cutlery, lubricating oils & grease, distribution & transmission line materials, electrical fittings, cables, insulating material, miscellaneous stores etc. In respect of items for which DGS&D has entered into rate contracts, COS may, at his discretion, make direct purchases upto a limit of Rs. 1 lakh in each case subject to ceiling limit of Rs. 5 lakhs in each case per annum. As per the existing instructions, all the supply orders placed against DGS&D rate contracts are placed on line through DGS&D website. The materials purchased through DGS&D are inspected & tested by inspection wing of DGS&D at firm’s premises prior to despatch. Whenever a valid rate contract is not available or the available rate contracts do not meet the requirements of the Railways in respect of the specification, delivery requirement and quality considerations, Railways can go ahead with the direct procurement of materials after recording adequate justification.
(iii) NSIC :
National Small Industries Corporation Ltd. is a Government of India enterprise under ministry of Micro, Small & Medium Enterprises (MSME). It promotes the growth of small industries & industry related micro, small and medium enterprises in the country. NSIC operates a single point registration scheme under the government purchase programme, where the registered SSI units get several benefits in procurement by railways such as
(a) Issue of tender documents free of cost,
(b) Exemption from payment of Earnest Money deposit,
(c) Waiver of Security Deposit upto the monetary limit for which the unit is registered. Some items are reserved to be procured from firms registered with NSIC such as different sizes of nuts, bolts & rivets, varnish & paint brushes, leather hand gloves etc. In addition to the above, the SSI units get automatic registration with the Railways based on NSIC registration certificate and no fee or cost of application form for seeking registration in Railways is charged from such firms.
(iv) CRIS :
Centre for Railway Information System (CRIS) provides consultancy and IT services to Indian Railways. CRIS has developed Indian Railway EProcurement System for IR. Complete activity of procurement of material by NC Railway is being done on IREPS. Tenders for procurement of material are first uploaded on the IREPS website, which are opened at the due date & time of tender opening. Then tabulation statement is printed and signed by the tender opening officials. After finalization of the tenders, the details of the purchase orders placed are uploaded on the website. With the introduction of e-tendering system, the procurement process has got expedited and it has also become more transparent. The CRIS is in the process of developing e-auction module on IREPS website for on line sale of scrap materials by Indian Railways.
(v) COFMOW :
It is an organization under ministry of railways for procurement & induction of modern workshop technologies and M&P. It prepare detailed technical specification for procurement of M&P. As per the existing instructions, all M&P items having value more than Rs. 10 Lakhs are required to be procured through COFMOW only. Railways can go for direct procurement of such M&P only after getting dispensation from COFMOW.
93. What are the various modes of tendering issued for procurement of materials by IR ? Discuss the need for adopting particular mode of tendering and also specify financial limits for issuing these tenders in normal circumstances.
Ans. The various modes of tendering issued for procurement of materials by IR are :
Ans. The various modes of tendering issued for procurement of materials by IR are :
(a) Open Tender
(b) Limited Tender
(c) Single Tender
(d) Special Limited Tenders
(e) Global Tender
(a) Open Tender:
This system of invitation of tender by public advertisement in the most open and public manner possible is called open tender. This is generally adopted in all cases in which the estimated value of purchase is over Rs. 10 lakh in normal circumstances.
(b) Limited Tender:
This system may ordinarily be adopted in the cases of the estimated tender value of which does not exceed Rs. 10 lakh. In case of items whose approved list of vendors is issued by centralized agency i.e. RDSO/Production Units (PUs)/CORE etc., this system may be adopted in the case of purchases, the estimated value of which does not exceed Rs. 2 crore.
Under this system enquiries are to be issued only to the firms who are borne on the approved list of suppliers for the particular item. While issuing such enquiries, it should be ensured that the last successful supplier is invariably included. The enquiries may be issued to a minimum number of three firms and a maximum of 7 or 8 against each other. Whenever a large number of firms are registered for a group/items, it may be ensured that enquiries are sent to all of them by rotation. However, the minimum/maximum number of enquiries to be sent against each tender be varied at the discretion of the competent authority as circumstances warrant. There is also no objection to the issue of limited tender enquiries to the firms not on approved list, provided justification for the same is recorded. In respect of cases falling within the purchase powers of officers below the rank of Dy.CMM, the approval of Dy.CMM should be obtained. In respect of cases falling within the purchase powers of Dy.CMM, the approval CMM and cases in any falling within the purchases powers of CMM the approval of COS should be obtained.
Under this system enquiries are to be issued only to the firms who are borne on the approved list of suppliers for the particular item. While issuing such enquiries, it should be ensured that the last successful supplier is invariably included. The enquiries may be issued to a minimum number of three firms and a maximum of 7 or 8 against each other. Whenever a large number of firms are registered for a group/items, it may be ensured that enquiries are sent to all of them by rotation. However, the minimum/maximum number of enquiries to be sent against each tender be varied at the discretion of the competent authority as circumstances warrant. There is also no objection to the issue of limited tender enquiries to the firms not on approved list, provided justification for the same is recorded. In respect of cases falling within the purchase powers of officers below the rank of Dy.CMM, the approval of Dy.CMM should be obtained. In respect of cases falling within the purchase powers of Dy.CMM, the approval CMM and cases in any falling within the purchases powers of CMM the approval of COS should be obtained.
(c)Single Tender:
This system may be adopted in case of purchase of items in following cases.
1. Proprietary articles where it has been possible to certify that a similar article, which could be used in lieu is not manufactured /sold by any other firm (PAC ‘C’ certified), Purchase powers are of different officers Are upto their level of acceptance.
2. For Non-Proprietary articles in normal circumstances. COS/CMM : Upto Rs. 3 lakhs, Invitation of single tender and purchase require personal approval of COS/CMM.
3. For Non-Proprietary articles in emergencies affecting maintenance, out turn, operation etc.. COS/CMM : Upto Rs. 5 lakhs, Invitation of single tender and purchase require personal approval of COS/CMM.
(d) Special Limited Tender:
Except in respect of emergency purchases and safety items, this system may be applied to orders, in estimated value of which is Rs. 10 lakhs and above, with the sanction of the General Manager, subject to the following condtions:-
(a)That sufficient reasons exist which indicate that it is not in the public interest to call for tenders by advertisements.
(b) That the demand is so urgent that any additional expenditure involved by the elimination of open competition must be incurred.
(c)That in the case of proprietary articles, the sanction of the General Manager is necessary only if it is not possible to certify that a similar articles is not manufactured or sold by any other firm which could be used in lieu.
(e) Global Tender: This system is adopted in case of import purchase. The proposed import procurement should be approved from the essentially aspect by the Head of User Department and concurred in by the associate finance.
94. Can the tendered item be split to place purchase orders on two or more firms ? What consideration will you keep in mind while deciding multi sourcing ?
Answer: Where warranted, for reasons to be recorded, the tender quantity may be split and tender decided In favour of one or more firms depending on merit of each case, in consultation with FA&CAO and approved by the authority competent to accept the tender, having regard to the following factors:-
(a)Vital and critical nature of items.
(b) Quantity to be procured.
(c)Delivery requirements.
(d) Capacity of firms in the zone of consideration.
(e)Past performance of the firms.
95. What are Railway Boards guidelines to deal with situations of suspected Cartel Formation?
Answer : Railway Boards guidelines to deal with situations of suspected Cartel Formation are summarized as below.
Answer : Railway Boards guidelines to deal with situations of suspected Cartel Formation are summarized as below.
(a)Wherever all or most of the approved firms quote equal rates and cartel formation is suspected, Railways reserve the right to place order on one or more firms with exclusion of the rest without assigning any reasons whatsoever.
(b) Firms are expected to quote for a quantity not less than 50% of tendered quantity. Offers for quantity less than 50% of quantity will be considered unresponsive and shall become liable to be rejected. This however will be without any prejudice to Railway’s right to distribute the tendered quantity & place order on one or more firms.
(c)The firms who quote in cartel be warned that their names are likely to be deleted from list of approved sources.
96. Calculate the total unit rate (Excluding freight) of an offer in which basic rate is Rs. 755/- each with 5% discount, ED is 12%, Cess on ED is 3%, VAT is 5%. If the quantity is 19750 units and freight charges is Rs. 8,60,000/- (Lump Sum), Calculate total value of purchase and indicate constitution of the tender committee.
Answer: Unit Rate (excluding freight) = [{(Basic Rate – discount) + (ED + Cess on ED)} + VAT].
Unit rate (excluding freight) = [{(755 – 5%) + (12% + 3% of 13%){ + [{(755 – 5%) + (12.36%)} + 5%] = Rs. 846.19.
Qty: 19750
So, total value (excluding freight) = Rs. 846.19 x 19750
= Rs. 16712252.50
Lump sum freight charge is Rs. 860000, So, Total Value of purchase = 16712252.50 + 860000 = Rs. 17572252.50
For this case constitution of tender committee will be
Stores member (convener) - JAG User
department - JAG
Accounts member - JAG
Answer: Unit Rate (excluding freight) = [{(Basic Rate – discount) + (ED + Cess on ED)} + VAT].
Unit rate (excluding freight) = [{(755 – 5%) + (12% + 3% of 13%){ + [{(755 – 5%) + (12.36%)} + 5%] = Rs. 846.19.
Qty: 19750
So, total value (excluding freight) = Rs. 846.19 x 19750
= Rs. 16712252.50
Lump sum freight charge is Rs. 860000, So, Total Value of purchase = 16712252.50 + 860000 = Rs. 17572252.50
For this case constitution of tender committee will be
Stores member (convener) - JAG User
department - JAG
Accounts member - JAG
97. What is the normal eligibility of a part-II approved vendor for ordering quantity ? What are the situations where they can be considered for bulk orders ?
Answer: Railway procure some of the items from approved sources:
Answer: Railway procure some of the items from approved sources:
Ordering on firms approved by RSDO/CORE/Pus as Part II vendors is to be limited upto 15% quantity normally. Ordering on Part-II approved sources can be beyond 15% or highest quantity of a past order for the tendered item successfully executed in the preceding 3 years in the same Railway unit or other Railway Units/Pus, whichever is higher, subject to
(i) maximum of 25% of the net procurable quantity in the given procurement case and
(ii) the tender committee/accepting authority being satisfied about the financial capacity., performance aspects, etc.
When more than one Part-II sources are within the zone of consideration on the basis of competitive price ranking with satisfactory past performance on that Railway, each Part-II sources may be considered for ordering in the same manner as indicated above. Aggregate quantity to be ordered on all Part-II approved vendors taken together, however, will not exceed 25% of the net procurable quantity, in a given procurement case.
If there is no approved source in Part-I list and approved source exist in PartII only, such Part-II firms will be considered for placement of Bulk quantity orders as well as without any quantity restrictions, otherwise applicable to Part-II firms.
When more than one Part-II sources are within the zone of consideration on the basis of competitive price ranking with satisfactory past performance on that Railway, each Part-II sources may be considered for ordering in the same manner as indicated above. Aggregate quantity to be ordered on all Part-II approved vendors taken together, however, will not exceed 25% of the net procurable quantity, in a given procurement case.
If there is no approved source in Part-I list and approved source exist in PartII only, such Part-II firms will be considered for placement of Bulk quantity orders as well as without any quantity restrictions, otherwise applicable to Part-II firms.
98. Elaborate on the Railway Board instructions on Negotiations.
Answer: Railway Boards instructions on Negotiations are summarized as below:
There should normally be no negotiations. Negotiations will 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.
Before resorting to negotiations, adequate care should be taken to scrutinize the rates received to avoid in fructuous instances of negotiations as such negotiations may cause unnecessary delay in procurement without any appreciable reduction in rates. Negotiations, wherever held, should only be with the L-1 tenderer. In the cases where rates of part-II approved vendors were lower than the original rate of the L-1 part-1 approved source, eligible and suitable for bulk ordering with whom a price negotiation is held and if after price negotiation with the L1 part-1 approved tenderer, their rate becomes lower than that of the lowest part-II approved tenderer, then another price negotiation should be held with the lowest part-II approved tenderer subject to the condition that the firms offer is otherwise suitable and eligible for placement of an order as per extant procedure.
There should normally be no negotiations. Negotiations will 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.
Before resorting to negotiations, adequate care should be taken to scrutinize the rates received to avoid in fructuous instances of negotiations as such negotiations may cause unnecessary delay in procurement without any appreciable reduction in rates. Negotiations, wherever held, should only be with the L-1 tenderer. In the cases where rates of part-II approved vendors were lower than the original rate of the L-1 part-1 approved source, eligible and suitable for bulk ordering with whom a price negotiation is held and if after price negotiation with the L1 part-1 approved tenderer, their rate becomes lower than that of the lowest part-II approved tenderer, then another price negotiation should be held with the lowest part-II approved tenderer subject to the condition that the firms offer is otherwise suitable and eligible for placement of an order as per extant procedure.
99. What is e-procurement and What are its benefits ? Briefly describe how the tender opening task is performed in this system.
Answer : E-procurement is the system, wherein the processes of procurement such as issue of tenders by the purchasers, comparison of offers and communications regarding the purchase process are done online through internet, maintaining adequate date security.
Benefits of e-procurement:
Benefits of e-procurement:
(i) Transparency
(ii) Wide publicity
(iii) Saving in procurement lead time
(iv) Tender opening is temper proof compared to manual tenders
(v) All the data is secured & temper proof
(vi) Delivery of tender enquiry, offers, etc. is fully ensured. Tender opening task in e-procurement systems: Officials deputed for tender opening (Stores & accounts, both) to login in the e-procurement system using their ID and digital signature after pre-decided opening time for the tenders. As soon as both the officials give command for tender opening the system (through program utilities) first authenticates the digital signatures and their authority and after authentication the virtual tender box is opened. Comparative statements and summaries of offers etc. can now be printed.
100. Differentiate between the following .
1. Single offer and single tender
Ans: Single offer: Single offer is the only one offer received against Limited, Special limited, Bulletin and Open tenders. Single Tender: When tender is issued to only one firm in special circumstances e.g. purchase against PAC, availability of only one supplier or urgent need necessitating purchase from a selected source.
2. Excise duty and Custom duty
Ans: Excise duty: Imposed by Govt. of India on manufacturers. It is imposed on goods being manufactured in India. Custom Duty: Imposed by Govt. of India on items being imported. It is imposed on goods manufactured outside India. It is imposed to protect indigenous indigenous industries.
3. Price Preference and Purchase Preference.
Ans: Price preference: It is a policy under which a firm belonging to certain category quoting higher rate as compared to the lowest technically suitable bidder becomes eligible for placement of order at its quoted rate. Purchase preference: It is a policy under which a firm belonging to certain category quoting higher rate as compared to the lowest technically suitable bidder becomes eligible for placement of order but at the rate quoted by the lowest suitable bidder.
4. Bill of Lading and Bill of Entry.
Answer : Bill of Lading : It is a document giving title to the goods, signed by the shipping company or his agent, containing the declaration regarding receipt of goods (cargo), the goods at the conditions on which transportation is made and the engagement to deliver the goods at the prescribed port of destination to the lawfull holder of the Bill of Lading. Bill of Entry : It is an application to the Customs authorities for permitting the release of goods landed or expected to be landed at port/Air port after the collection of Customs duty.
101. Write short notes on.
1. Letter of Credit.
2. Tender Committee.
3. Local Purchase.
4. Payment clause in purchase of M&P items.
Answer: 1. Letter of credit : It is a bank instrument frequently issued between banks in different countries for the payment of import contracts. It may be defined as an instrument authorizing the (issuing) bank on behalf of the purchaser (Applicant) to pay a certain sum of money to specified seller(s) (Beneficiary) provided the seller(s) submit the documents as prescribed in the Letter of Credit.
2. Tender Committee- In case of tender valued above Rs. 10 lac, the purchase is recommended by tender committee. The committee should be constituted by the authority competent to accept the tender. In tender committee case convening member will be put up recommendations to the next higher authority for acceptance. Total value of the case as on date of tender opening shall be the criteria for deciding the level of TC. TC of stores department consists of stores member who also acts as convener, technical member and finance member.
3. Local Purchase-The Controller of Stores may also make local purchases of items of small value, both stock and non-stock, up to Rs.1 lac in each case, subject to the condition that in the case of stock items, the purchases are made only where
a. The normal annual recoupment quantity does not exceed Rs.1 lac in value, or
b. The stock of the item is precariously low and the item is urgently required,
c. And that the quantity is not deliberately reduced with a view to bring the purchase within the scope of this provision.
d. He will make no purchase without satisfying himself that the price paid is reasonabl
e. The powers referred to above or other power of local purchases of stores delegated to the COS may be redelegated to the depot officers, in consultation with the FA&CAO to the extent considered necessary in each case.
a. The normal annual recoupment quantity does not exceed Rs.1 lac in value, or
b. The stock of the item is precariously low and the item is urgently required,
c. And that the quantity is not deliberately reduced with a view to bring the purchase within the scope of this provision.
d. He will make no purchase without satisfying himself that the price paid is reasonabl
e. The powers referred to above or other power of local purchases of stores delegated to the COS may be redelegated to the depot officers, in consultation with the FA&CAO to the extent considered necessary in each case.
4.Payment clause in purchase of M&P items.- The standard payment terms in purchase of M&P items are as under:-
- 80% on proof of inspection certificate and dispatch documents.
- Balance 20% after satisfactory installation, commissioning and proving test of M&P subject to submission of bank guarantee for an amount of 10% of contract value, as warranty security.
102. Differentiate between F.O.B and F.A.S. :
Answer : F.A.S. : Free Along Shore : When a contract is arranged on FAS basis, the contractor is understood to undertake to deliver the goods along shore the ship at his own expenses. F.O.B. : Free on Board : When goods are purchased on FOB basis, the duty of the contractor is to deliver the goods on board ship at his own expenses for carriage to the purchaser. The purchaser is liable for freight and other subsequent charges..
103. (a)What is SOP, its need and importance?
Ans The Schedule of Powers represents inter-alia delegation of powers to the General Managers as received from Railway Board. The objectives of the Schedule of Powers is to detail the powers delegated to the Officers by the General Managers for quick decision making and decentralization. The powers delegated are to be exercised only by the authority indicated and to the extent specified. The powers are subject to existing codal procedures, rules and other extant orders issued by Railway Board from time to time. The powers are also subject to availability of funds. No redelegation is permissible unless specifically authorized by the General Managers. The delegation is grouped mainly under 3 headings
A. PHODs/HODs
B. DRM/ ADRM/ SAG Officers in field units.
C. Divisional / Extra Divisional Officers and Officers in H.Qrs.
The schedule of power is divided into 7 parts relating to works matters, miscellaneous matters, Establishment matters, Commercial matters, Stores matters and Medical matters. The latest introduction to the Schedule of Powers is the financial powers delegated to officers in Disaster Management. There are certain powers, which cannot be delegated even by the General Managers to the officers down the line. There is an attached annexure to the Schedule of Powers on every Railway which outlines the list of items requiring the personal approval/sanction of the General Manager. The General Manager’s powers are termed as negative powers because the powers outline what the General Managers can not do which implies the approval/ previous sanction of higher authority is necessary.
(b): Estimated value of purchase proposal for mechanical item was Rs. 29 lakhs. Advertised tender was floated. Lowest offer was Rs. 29.5 lakhs but technically unsuitable. Next higher offer was Rs. 32 lakhs and technically suitable. On basis of Tender committee recommendations as accepted by accepting authority, PO was placed on firm for amount Rs. 32 lakhs. Please find out following;
a) Authority who approved the purchase proposal;
b) Grades of Tender committee members who passed over the lowest technically unsuitable offer;
c) Accepting authority who finally accepted the offer.
d) PO signing authority.
Ans: a) Dy.CMM b) SMM, AFA, SME c) CMM d) Dy.CMM
104. What are the types of fabrication contracts generally entered into by railways? What factors are considered while deciding to go for fabrication contracts?
Ans. A contract to convert raw material into a finished product is called fabrication contract. Railways are entering into following types of fabrication contracts;
a) Fabrication of raw cloth into different styles of uniform;
b) Fabrication of N.F. scrap into finished item, such as bronze ingot from bronze scrap etc.
c) Fabrication of steel billets into finished materials i.e. MS rounds, track fittings etc.
d) Fabrication of paper into books and forms Factors considered while deciding to go for fabrication contracts are;
a) Whether the conversion of raw material into finished product is cheaper than the sale value that may be realised from the sale of scrap plus the cost of fabrication when compared to the cost of the finished material available in the market.
b) Whether railways themselves have the facility to fabricate.
105. What are various preferences applied for purchase of Printing and stationary stores in India?
Ans: Preferences in making purchases should be given in the following order:- Firstly, to articles produced in India in the form of raw materials or manufactured in India from raw materials produced in India, provided that the quality is sufficiently good for the purpose; Secondly, to articles wholly or partially manufactured in India from imported materials, provided that the quality is sufficiently good for the purpose; Thirdly, to articles manufactured abroad and held in stock in India, provided that they are of suitable type and requisite quality; Fourthly, to articles manufactured abroad which need to be specially imported.
Ans: Preferences in making purchases should be given in the following order:- Firstly, to articles produced in India in the form of raw materials or manufactured in India from raw materials produced in India, provided that the quality is sufficiently good for the purpose; Secondly, to articles wholly or partially manufactured in India from imported materials, provided that the quality is sufficiently good for the purpose; Thirdly, to articles manufactured abroad and held in stock in India, provided that they are of suitable type and requisite quality; Fourthly, to articles manufactured abroad which need to be specially imported.
106. What are the types of forms, their schedule and standardization in Indian Railways ?
Ans: The forms in use on railways fall under two main categories: -
Ans: The forms in use on railways fall under two main categories: -
(a) Standard and
(b) Local. Standard forms and registers are those prescribed by Code Rules, orders of the Railway Board and which are common for all railways. Local forms and registers are those introduced under the orders of the General Manager or Chief Accounts Officer to meet local requirements. Schedule of
Forms -
Each railway should maintain a complete schedule of standard and local forms and printed registers in use on the railway. The numbers, if any, assigned by the prescribing authority to Standard Form, etc. should be adopted, without change, for use in this schedule and the forms themselves. If for any reason different numbers are assigned by the railway to such forms, the original numbers should also be exhibited alongwith for easy identification of the forms. The authority for the standard and local forms i.e., reference to the relevant paragraph of the Codes or other, should be quoted in the schedule.
Alteration or Modification of Standard Forms-
No alteration or modification in respect of the title, the distinguishing number and the information prescribed in a standard form should be made without the sanction of the Railway Board. The size and substance of paper for the forms should be as per schedule of standard forms issued by the Railway Board. Subject to this restriction, any addition or modification which may be found necessary to suit conditions purely local to a railway may be made in a standard form at the discretion of railway administration. When the revision of a standard form is undertaken by the Railway Board the railway administration will be informed in time, so that they may not print or order for, another supply without first referring to authority revising the form. The railway administration should ordinarily print and issue the revised form, after all existing stock of the old has been exhausted, but if for special reasons, it is necessary to bring the revised form into use at once, they will be advised accordingly. They should then print the new form, but any remaining stock of the old forms should not be destroyed without the orders of the General Manager. Introduction of Local Forms-No new local forms may be introduced without the approval of the General Manager or the Chief Accounts Officer.
Forms -
Each railway should maintain a complete schedule of standard and local forms and printed registers in use on the railway. The numbers, if any, assigned by the prescribing authority to Standard Form, etc. should be adopted, without change, for use in this schedule and the forms themselves. If for any reason different numbers are assigned by the railway to such forms, the original numbers should also be exhibited alongwith for easy identification of the forms. The authority for the standard and local forms i.e., reference to the relevant paragraph of the Codes or other, should be quoted in the schedule.
Alteration or Modification of Standard Forms-
No alteration or modification in respect of the title, the distinguishing number and the information prescribed in a standard form should be made without the sanction of the Railway Board. The size and substance of paper for the forms should be as per schedule of standard forms issued by the Railway Board. Subject to this restriction, any addition or modification which may be found necessary to suit conditions purely local to a railway may be made in a standard form at the discretion of railway administration. When the revision of a standard form is undertaken by the Railway Board the railway administration will be informed in time, so that they may not print or order for, another supply without first referring to authority revising the form. The railway administration should ordinarily print and issue the revised form, after all existing stock of the old has been exhausted, but if for special reasons, it is necessary to bring the revised form into use at once, they will be advised accordingly. They should then print the new form, but any remaining stock of the old forms should not be destroyed without the orders of the General Manager. Introduction of Local Forms-No new local forms may be introduced without the approval of the General Manager or the Chief Accounts Officer.
107. Write briefly on printing of forms and registers.
Ans: Printing of Forms- Standard and local forms and printed registers should be printed in the Railway Press wherever one exists. Departments should advise the Supdt. of Ptg. and Sty. annually or half yearly, as may be arranged, of their requirements of the standard and local forms and Printed Registers. Such indents should be carefully scrutinised by the Heads of offices with relation to the statistics of work in each office and unnecessary items or quantities deleted before submission. The Printing Supdt. should make the necessary arrangements for printing, stocking a working supply and issue of the forms and registers. Printing in Outside Presses-If a railway press is unable to undertake a work on account of pressure of work or lack of suitable facilities, or the railway has no press of its own, the work may be got executed in outside presses, with the sanction of the General Manager, or that of the Heads of Departments or, other lower authorities, if power in this respect has been delegated to them by the General Manager. In arranging for printing work in outside presses, the General purchase policy should be followed.
108. Write briefly on accountal of forms and their verification.
Ans. Accountal of Forms- Numerical ledgers, only need to be maintained for forms. The receipts should be posted from the challans of the Supdt. of the Railway press and the Receipt Notes for local purchase in the case of orders on outside presses. Balances in the ledgers should be struck at the end of each month. Verification of Balances of Stationery, Forms and Printed RegistersDepartmental stock verification should be carried out as prescribed for other general stores in paragraph1339-S. Accounts Stock verification should be carried out once in three years as provided in paragraph 3327-S.
109. Discuss the necessity for prescribing uniforms.
Ans:
a) The need for easy identification of certain categories of staff by the public during their duty hours.
a) The need for easy identification of certain categories of staff by the public during their duty hours.
b) The need of protecting the staff who are exposed to extremes of weather like severe cold or heavy rain during their duty hours.
c) The need to fulfill the requirements of various Acts/Laws connected with the safety of staff during their working hours.
110. What is the scale of supply of uniforms.
Ans:
(a)The staff who are supplied with cotton garments for summer should be supplied with Three sets of uniforms every year.
(a)The staff who are supplied with cotton garments for summer should be supplied with Three sets of uniforms every year.
(b) The staff who are supplied with terene cotton uniforms for summer should be supplied with 2 sets of uniforms every alternative years.
(c)The female employees who are supplied with cotton uniforms for summer should be supplied with 4 sets of cotton sarees-blouse pieces/ shalwar kameez cloth every year.
(d) 3 sets of terene cotton sarees- blouse pieces/ shalwar kameez cloth every alternative year. For woolen uniforms.
(d) 3 sets of terene cotton sarees- blouse pieces/ shalwar kameez cloth every alternative year. For woolen uniforms.
(a)Winter only: 2 sets in 3 years.
(b) Summer & mild winter – 1 set in 4 years.
(c)Summer and winter- 1 set in 2 years.
111. What are the various climatic zones of Indian Railway for uniform supply?
Ans: Indian Railways have been classified into ‘5’ climatic Zones.
1. Summer only: where the average daily min. temp. during the coldest month of the year is above 16.70 C
2. Summer and mild winter: where the avg. daily min. temp. during the coldest month of the year is neither above 16.70 C nor below 11.70C.
3. Summer and Winter: where the avg. daily min. temp. during the coldest month of the year is below 11.70C
4. Winter only: where the Avg. daily min. temp. during the whole year is below 11.70 C
5. Very Cold: where the avg. daily min. temp. during the whole year is below 7.2 0 C.
112. What is the timetable for submission of demands to stores depot for supply of uniforms?
Ans: Time table for submission of demands for Uniforms to store depot is as follows
SEASON Last date by which the demand should reach the supplying depot.
SUMMER 1st April of previous year
WINTER 1st October of previous year
MONSOON 1st November of previous year
SEASON Last date by which the demand should reach the supplying depot.
SUMMER 1st April of previous year
WINTER 1st October of previous year
MONSOON 1st November of previous year
113. What is budget? What are various budgeting stages? What is stores budget?
Ans: Budget is a monetary plan for a time period. It is an estimate of future cost on revenues. It sets the targets, assigns responsibility and evaluates performance. It has several stages. Budget estimate is submitted in month of November. The budget is presented to Parliament in month of February. Budget grants are approved in month of March. This is followed by August review, revised estimates, final modification and telegraphic modification. Stores budget is part of demand no. 16 (capital). Money allotted for purchase is called purchase grant. Main budget based control for expenditure on stores budget is Liability register maintained by store accounts.
114. What is ZBB? How it is different from traditional budgeting
Ans: ZBB is zero based budgeting. Budgeting under this system for each year is done taking the base as zero. In other words the budgeting for each year is to be done from scratch. Its main objective is Management by objective. In traditional budgeting, AAC’s of individual items do not match with budgetary provisions. Since procurement process is distributed over the year, items processed with inflated AAC consume and block funds. PO can’t be released for all items due to fund shortage. ZBB aims at restricting AAC as per budgetary provisions. ABC analysis is used for fund allocations. About 65% funds are allocated for A category items. AAC’s are adjusted as per budgetary provisions. Thus better and efficient fund utilisation occurs along with improved material availability. Inactive and surplus items can be controlled.
115. Why should the expenditure incurred in the purchase of stores be treated as suspense? How the said suspense is cleared?
Ans: Materials are purchased for use by railway departments e.g. maintainance of coach, wagons, locos, electric installations S&T etc. For each use, a head of account is allotted, so that the expenditure and budgeting can be done correctly. However, stock items kept in store depot have to wait till indentor draws it for use. This account is known as stores suspense. When the material is drawn by the consumer, the cost of stores is charged to the final expenditure account of the consumer, by crediting the stores suspense.
116. Explain
a) Misc. Advance Capital
b) SINT
c) Stock adjustment account
a) Misc. Advance Capital
b) SINT
c) Stock adjustment account
Ans: a) Misc. Advance Capital: It is operated to watch issues of stores for manufacture given to outsiders for fabrication etc.
b) SINT stands for stores in transit. Whenever stores are transferred from one depot to other, this head is operated separately for each depot.
c) Stock adjustment account: Knowing the practical difficulty involved in the receipt and issue of stores, involving thousands of items and numerous transactions, this head is provided for. It speaks about the efficiency of store keeping of a depot. It includes difference in book balance and ground balance; errors due to erroneous pricing/mistakes and other miscellaneous errors.
Q.No.159. What are provisions in IRS Terms & Conditions regarding Security Deposit?
Ans.
0500: SECURITY DEPOSIT: 0501:
0500: SECURITY DEPOSIT: 0501:
Unless otherwise agreed between the Purchaser and the contractor, the contractor shall, within 14 days of written notice of acceptance of the tender has been posted to the contractor, deposit with the Railway concerned (in cash or the equivalent in Government Securities or approved Banker's Guarantee Bond) a sum equal to 10 per cent of the total value of the stores detailed in the contract for which, the tender has been accepted, subject to upper ceiling of Rs. 10 Lakhs for contracts valuing upto Rs.10 Crores & Rs.20 Lakhs for contract valuing above Rs.10 Crores.
SAFETY ITEMS:
The Security Deposit (SD)/Performance Guarantee shall be taken from all firms for contracts for all Safety Items placed against Advertised Tenders and Global Tenders subject to following exemptions: a) Vendors registered with NSIC upto the monetary limit of their registration for the items ordered Tenderers seeking waiver of Security Deposit on this ground shall have to submit requisite documentary evidence.
OTHER THAN SAFETY ITEMS:
The Security Deposit (SD) shall be taken from all firms for contracts for items other than safety items placed against Advertised Tenders and Global Tenders subject to following exemptions:
a) Vendors registered with NSIC upto the monetary limit of their registration for the items ordered.
b) Vendors registered with Railways upto the monetary limit of their registration for the items ordered/trade groups for items ordered or vendors on approved list of RDSO/PUs/ CORE/Railways etc. for those specific items for which they are on approved list or other Railways, Govt. Departments on their specific request and on merits of the case as considered by tender committee.
c) Tenderers seeking waiver of Security Deposit on this ground shall have to submit requisite documentary evidence. The usual security deposit, shall, however be taken in case the contracts are placed on unregistered/ unapproved firms or for items for which a particular firm is not registered/approved. Security Deposit should remain valid for a minimum period of 60 days beyond the date of completion of all the contractual obligations of the supplier. 0502: If the contractor, having been called upon by the Purchase to furnish security fails to make and to maintain a security deposit within the specified period, it shall be lawful for the Purchaser:
a) to recover from the Contractor the amount of such security deposit by deducting the amount from the pending bills of the contractor under the contract or any other contract with the purchaser or the Government or any person contracting through the Purchaser or otherwise however, or
b) to cancel the contract or any part thereof and to purchase or authorize the purchase of the stores at the risk and cost of the contractor and in that event the provisions of Clauses 0702 shall apply as far as applicable. 0503:
No claim shall lie against the Purchaser in respect of interest on cash deposits or Government Securities or depreciation thereof. 0504:
The Purchaser shall be entitled and it shall be lawful on his part to forfeit the said security deposit in whole or in part in the event of any default, failure or neglect on the part of the Contractor in the fulfillment or performance in all respects of the contract under reference or any other contract with the Purchaser or any part thereof to the satisfaction of the Purchaser and the Purchaser shall also be entitled to deduct from the said deposits any loss or damage which the Purchaser may suffer or be put by reason of or due to any act or other default, recoverable by the Purchaser from the Contractor in respect of the contract under reference or any other contract and in either of the events aforesaid to call upon the contractor to maintain the security deposits at its original limit by making further deposit, provided further that the Purchaser shall be entitled to recover any such claim from any sum then due or which at any time thereafter may become due to the Contractor under this or any other contracts with the Purchaser.
No claim shall lie against the Purchaser in respect of interest on cash deposits or Government Securities or depreciation thereof. 0504:
The Purchaser shall be entitled and it shall be lawful on his part to forfeit the said security deposit in whole or in part in the event of any default, failure or neglect on the part of the Contractor in the fulfillment or performance in all respects of the contract under reference or any other contract with the Purchaser or any part thereof to the satisfaction of the Purchaser and the Purchaser shall also be entitled to deduct from the said deposits any loss or damage which the Purchaser may suffer or be put by reason of or due to any act or other default, recoverable by the Purchaser from the Contractor in respect of the contract under reference or any other contract and in either of the events aforesaid to call upon the contractor to maintain the security deposits at its original limit by making further deposit, provided further that the Purchaser shall be entitled to recover any such claim from any sum then due or which at any time thereafter may become due to the Contractor under this or any other contracts with the Purchaser.
Q.No.160. What are provisions in IRS Terms & Conditions regarding Failure and Termination of Supply Order?
Ans. Failure and Termination:-If the Contractor fails to deliver the stores or any instalment thereof within the period fixed for such delivery in the contract or as extended or at any time repudiates the contract before the expiry of such period the Purchaser may without prejudice to his other rights:- 1
Ans. Failure and Termination:-If the Contractor fails to deliver the stores or any instalment thereof within the period fixed for such delivery in the contract or as extended or at any time repudiates the contract before the expiry of such period the Purchaser may without prejudice to his other rights:- 1
(a) recover from the Contractor as agreed liquidated damages and not by way of penalty a sum equivalent to 2 per cent of the price of any stores (including elements of taxes, duties, freight, etc.) which the Contractor has failed to deliver within the period fixed for delivery in the contract or as extended for each month or part of a month during which the delivery of such stores may be in arrears where delivery thereof is accepted after expiry of the aforesaid period, or .1
(b) 1. Risk Purchase clause is deleted for all orders for safety items, as levy of 10% Security deposit has been made compulsory in all such order/(except in case of vendors registered with NSIC upto the monetary limit of their registration for the items ordered). In case of failure of contract, Security Deposit shall be forfeited. Such failure shall be recorded & will be considered by Railways on merit in future cases.
1. 2. In respect of orders for materials other than safety items where 10% security deposit has been taken from firms, Risk Purchase clause is deleted and in case of default by such firms, the Security Deposit shall be forfeited.
2. 3. In such cases as covered under (1) and (2) above, the quantities unsupplied shall be procured independently without risk and cost of the original firm/supplier.
3. 4. Adverse performance of such firms will be recorded and intimated to the approving authority & also to be taken into account in future tender cases on merit.
4. 5. Such cases which are not covered under Para (1) & (2) above. Risk Purchase provisions shall continue for them as per existing guideline as given below. .
2(c) The Purchaser reserves the right to purchase or authorise the purchase of the stores not so delivered or others of a similar description (where stores exactly complying with particulars are not in the opinion of the Purchaser, which shall be final, readily procurable) at the risk and cost of the Contractor. .3It shall, however, be in the discretion of the purchaser to collect or not, Security Deposit from the firm/firm’s on whom the contract is placed at the risk and expense of the defaulted firm.
2(d) Where action is taken under Sub-clause
(c) above, the Contractor shall be liable for any loss which the Purchaser may sustain on that account provided the purchase or if there is an agreement to purchase 1 such agreement is made, in case of failure to deliver the stores within the period fixed for such delivery in the contract or as extended within six months from the date of such failure and in case of repudiation of the contract before the expiry of the aforesaid period of delivery, with six months from the date of cancellation of the contract. The Contractor shall not be entitled to any gain on such purchase and the manner and method of such purchase shall be in the entire discretion of the Purchaser. It shall not be necessary for the Purchaser to serve a notice of such purchase on the Contractor.
Note : In respect of the stores which are not easily available in the market and where procurement difficulties are experienced the period for making risk purchase shall be nine months instead of six months provided above.
Q.No.161. What are provisions in IRS Terms & Conditions regarding Arbitration in case of dispute in Supply Order?
Ans. 2900. Arbitration. .1(a) In the event of any question, dispute or difference arising under these conditions or any special conditions of contract, or in connection with this contract (except as to any matters the decision of which is specially provided for by these or the special conditions) the same shall be referred to the sole arbitration of a Gazetted Railway Officer appointed to be the arbitrator, by the General Manager in the case of contracts entered into by the Zonal Railways and Production Units; by any Member of the Railway Board, in the case of contracts entered into by the Railway Board and by the Head of the Organisation in respect of contracts entered into by the other Organisations under the Ministry of Railways. The Gazetted Railway Officer to be appointed as arbitrator however will not be one of those who had an opportunity to deal with the matters to which the contract relates or who in the course of their duties as railway servant have expressed views on all or any of the matters under dispute or difference. The award of the arbitrator shall be final and binding on the parties to this contract.
.2(b) In the event of the arbitrator dying, neglecting or refusing to act or resigning or being unable to act for any reason, or his award being set aside by the court for any reason, it shall be lawful for the authority appointing the arbitrator to appoint another arbitrator in place of the outgoing arbitrator in the manner aforesaid. .
3(c) It is further a term of this contract that no person other than the person appointed by the authority as aforesaid should act as arbitrator and that if for any reason that is not possible, the matter is not to be referred to 'arbitration at all. .
4(d) The arbitrator may from time-to-time with the consent of all the parties to the contract enlarge the time for making the award. .
5(e) Upon every and any such reference, the assessment of the cost incidental to the reference and award respectively shall be in the discretion of the arbitrator. .
6(f) Subject as aforesaid, the Arbitration Act, 1940 and the rules there under and any statutory modifications thereof for the time being in force shall be deemed to apply to the arbitration proceedings under this clause.
7(g) The venue of arbitration shall be the place from which the acceptance note is issued or such other place as the arbitrator at his discretion may determine. .
8(h) In this clause the authority, to appoint the arbitrator includes, if there be no such authority, the officer who is for the time being discharging the functions of that authority, whether in addition to other functions or otherwise.
Q.No.162. What is consignee’s right of rejection as per IRS Terms & Conditions?
Asn 1502. Consignee’s Right of Rejection - Notwithstanding any approval which the Inspecting Officer may have given in respect of the stores or any materials or other particulars or the work or workmanship involved in the performance of the contract (whether with or without any test carried out by the Contractor or the Inspecting Officer or under the direction of the Inspecting Officer) and not with standing delivery of the stores where so provided to the interim consignee, it shall be lawful for the consignee, on behalf of the Purchaser, to reject the stores or any part, portion or consignment thereof within a reasonable time after actual delivery thereof to him at the place or destination specified in the contract if such stores or part, portion or consignment thereof is not in all respects in conformity with the terms and conditions of the contract whether on account of any loss, deterioration or damage before despatch or delivery or during transit or otherwise howsoever.
Note-In respect of materials pre-inspected at the firm's premises the consignee will issue rejection advice within 90 days from the date of receipt.
Q.No.163. What is Book Examination Clause as per IRS Terms & Conditions?
Ans. 3300. Book Examination Clause-The Government reserves the right for 'Book Examination' as follows: -
(i) The Contractor shall whenever called upon and requiring to produce or cause to be produced for examination by any Government Officer duly authorised in that behalf, any cost or other account book of account, voucher, receipt, letter, memorandum, paper or writing or any copy of or extract from any such document and also furnish information any way relating to such transaction and procedure before the duly authorised Government Officer returns verified in such manner as may be required relating in any way to the execution of this contract or relevant for verifying or ascertaining the cost of execution of this contract (the decision of such Government Officer on the question of relevancy of any document, information of return being final and binding on the parties). The obligation imposed by this clause is without prejudice to the obligation of the contractor under any statute, rules or orders shall be binding on the Contractor.
(ii) The Contractor shall, if the authorised Government Officer so requires (whether before or after the prices have been finally fixed), afford facilities to the Government Officer concerned to visit the Contractors works for the purpose of examining the processes of manufacture and estimating or ascertaining the cost of production of the articles. If any portion of the work be entrusted or carried out by a sub-contractor or any of its subsidiary or allied firm or company, the authorised Government Officer shall have power to examine all the relevant books of such sub-contractor or any subsidiary or allied firm or company shall be open to his inspection as mentioned in clause (i).
(iii) If on such examination, it is established that the contracted price is in excess of the actual cost plus reasonable margin of profit, the Purchaser shall have the right to reduce the price and determine the amount to a reasonable level.
(iv) Where a contract provides for book examination clause, the Contractor or its agency is bound to allow examination of its books within a period of 60 days from the date the notice is received by the Contractor, or its agencies calling for the production of documents as under clause (i) above. In the event of Contractor's or his agency's failure to do so, the contract price would be reduced and determined according to the best judgement of the Purchaser which would be final and binding on the Contractor and his agencies.
Q.No.164. What is Book Examination Clause as per IRS Terms & Conditions?
Ans 3300. Book Examination Clause-The Government reserves the right for 'Book Examination' as follows: -
(i) The Contractor shall whenever called upon and requiring to produce or cause to be produced for examination by any Government Officer duly authorised in that behalf, any cost or other account book of account, voucher, receipt, letter, memorandum, paper or writing or any copy of or extract from any such document and also furnish information any way relating to such transaction and procedure before the duly authorised Government Officer returns verified in such manner as may be required relating in any way to the execution of this contract or relevant for verifying or ascertaining the cost of execution of this contract (the decision of such Government Officer on the question of relevancy of any document, information of return being final and binding on the parties). The obligation imposed by this clause is without prejudice to the obligation of the contractor under any statute, rules or orders shall be binding on the Contractor.
(ii) The Contractor shall, if the authorised Government Officer so requires (whether before or after the prices have been finally fixed), afford facilities to the Government Officer concerned to visit the Contractors works for the purpose of examining the processes of manufacture and estimating or ascertaining the cost of production of the articles. If any portion of the work be entrusted or carried out by a sub-contractor or any of its subsidiary or allied firm or company, the authorised Government Officer shall have power to examine all the relevant books of such sub-contractor or any subsidiary or allied firm or company shall be open to his inspection as mentioned in clause (i).
(iii) If on such examination, it is established that the contracted price is in excess of the actual cost plus reasonable margin of profit, the Purchaser shall have the right to reduce the price and determine the amount to a reasonable level.
(iv) Where a contract provides for book examination clause, the Contractor or its agency is bound to allow examination of its books within a period of 60 days from the date the notice is received by the Contractor, or its agencies calling for the production of documents as under clause
(i) above. In the event of Contractor's or his agency's failure to do so, the contract price would be reduced and determined according to the best judgement of the Purchaser which would be final and binding on the Contractor and his agencies.
Q.No. 165. What are provisions regarding Warranty/Guarantee in IRS Terms & Conditions?
3200. Warranty/Guarantee-3201. The Contractor/Seller hereby covenants that it is a condition of the contract that all goods/stores/articles furnished to the Purchaser under this contract shall be of the highest grade free of all defects and faults and of the best materials, quality, manufacture and workmanship throughout and consistent with the established and generally accepted standards for materials of the type ordered and in full conformity with the contract specification, drawing or sample, if any and shall, if operable, operate properly.
3202. The Contractor also guarantees that the said goods/stores/articles would continue to conform to the description and quality as aforesaid, for a period of 30 months after their delivery or 24 months from the date of placement in service whichever shall be sooner, and this warranty shall survive notwithstanding the fact that the goods/stores/articles may have been inspected, accepted and payment thereof made by the Purchaser.
3203. If during the aforesaid period, the said goods/stores/articles be discovered not to conform to the description and quality aforesaid or have deteriorated, otherwise that by fair wear and tear the decision of the Purchaser in that behalf being final and conclusive that the Purchaser will be entitled to reject the said goods/stores/articles or such portions thereof as may be discovered not to conform to the said description and quality. On such rejection, the goods/stores/articles will be at the Seller's risk. If the Contractor/Seller so desires, the rejected goods may be taken over by him or his agents for disposal such manner as he may deem fit within a period of 3 months from the date of such rejection. At the expiry of the period, no claim whatsoever shall lie against the Purchaser in respect of the said goods/stores/articles, which may be disposed of by the Purchaser in such manner as he thinks fit. Without prejudice to the generality of the foregoing, all the provisions in the Indian Railways Standard Conditions of Contract relating to the ‘rejection of stores' and ‘failure' and 'termination' add and Clause 3100- 02 above shall apply.
3204. The Contractor/Seller shall, if required, replace the goods or such portion there of as have been rejected by the Purchaser, free of cost, at the ultimate destination, or at the option of the Purchaser, the Contractor/Seller shall pay to the Purchaser, the value thereof at the contract price and such other expenditure and damage as may arise by reason of the breach of the conditions herein before specified. Nothing herein contained shall prejudice any other right of the Purchaser in that behalf under this contract or -otherwise.
Q.No.166. What are provisions regarding Removal of Rejected Stores in IRS Terms & Conditions?
Ans. 2200. Removal of Rejected Stores.
2201. On rejection of all stores submitted for inspection at a place other than the premises of the Contractor, such stores shall be removed by the Contractor at his own cost subject as hereinafter stipulated, within 21 days of the date of intimation of such rejection. If the concerned communication is addressed and posted to the Contractor at the address mentioned in the contract, it will be deemed to have been served on him at the time when such communication would be in the course of ordinary post reach the Contractor. Provided that the Inspecting Officer may call upon the Contractor to remove dangerous, infected or perishable stores within 48 hours of the receipt of such communication and the decision of the Inspecting Officer in this behalf shall be final in all respects. Provided further that where the price or part thereof has been paid, the consignee is entitled without prejudice to his other rights to retain the rejected stores till the price paid for such stores is refunded by the Contractor save that such retention shall not in any circumstances be deemed to be acceptance of the stores or waiver of rejection thereon.
2202. All rejected stores shall in any event and circumstances remain and always be at the risk of the Contractor immediately on such rejection. If such stores are not removed by the Contractor within the periods aforementioned, the Inspection Officer may remove the rejected stores and either return the same to the contractor at his risk and cost by such mode of transport as the Purchaser or Inspecting Officer may decide, or dispose of such stores at the Contractor's risk and on his account and retain such portion of the proceeds, if any from such disposal as may necessary to recover any expense incurred in connection with such disposals (or any price refundable as a consequence of such rejection). The Purchaser shall, in addition, be entitled to recover from the Contractor ground rent/demurrage charges on the rejected stores after the expiry of the time limit mentioned above.
2203. The stores that have been despatched by rail and rejected after arrival at destination may be taken back by the Contractor either at the station where they were rejected or at the station from which they were sent, after refunding the price paid for such stores and other charges refundable as a consequence of such rejection. If the contract placed for delivery f o. r. station of despatch, the Contractor shall pay the carriage charges on the rejected consignment at public tariff rates from the station of despatch to the station where they are rejected. If the Contractor elects to take back the goods at the station from which they were despatched, the goods shall in addition, be booked back to him freight to pay at public tariff rates and at owner's risk. The Contractor shall be liable to reimburse packing and incidental costs and charges incurred in such return or rejected stores in addition to other charges refundable as a consequence of rejection. The goods shall remain the property of the Contractor unless and until accepted by the Purchaser, after inspection.
2201. On rejection of all stores submitted for inspection at a place other than the premises of the Contractor, such stores shall be removed by the Contractor at his own cost subject as hereinafter stipulated, within 21 days of the date of intimation of such rejection. If the concerned communication is addressed and posted to the Contractor at the address mentioned in the contract, it will be deemed to have been served on him at the time when such communication would be in the course of ordinary post reach the Contractor. Provided that the Inspecting Officer may call upon the Contractor to remove dangerous, infected or perishable stores within 48 hours of the receipt of such communication and the decision of the Inspecting Officer in this behalf shall be final in all respects. Provided further that where the price or part thereof has been paid, the consignee is entitled without prejudice to his other rights to retain the rejected stores till the price paid for such stores is refunded by the Contractor save that such retention shall not in any circumstances be deemed to be acceptance of the stores or waiver of rejection thereon.
2202. All rejected stores shall in any event and circumstances remain and always be at the risk of the Contractor immediately on such rejection. If such stores are not removed by the Contractor within the periods aforementioned, the Inspection Officer may remove the rejected stores and either return the same to the contractor at his risk and cost by such mode of transport as the Purchaser or Inspecting Officer may decide, or dispose of such stores at the Contractor's risk and on his account and retain such portion of the proceeds, if any from such disposal as may necessary to recover any expense incurred in connection with such disposals (or any price refundable as a consequence of such rejection). The Purchaser shall, in addition, be entitled to recover from the Contractor ground rent/demurrage charges on the rejected stores after the expiry of the time limit mentioned above.
2203. The stores that have been despatched by rail and rejected after arrival at destination may be taken back by the Contractor either at the station where they were rejected or at the station from which they were sent, after refunding the price paid for such stores and other charges refundable as a consequence of such rejection. If the contract placed for delivery f o. r. station of despatch, the Contractor shall pay the carriage charges on the rejected consignment at public tariff rates from the station of despatch to the station where they are rejected. If the Contractor elects to take back the goods at the station from which they were despatched, the goods shall in addition, be booked back to him freight to pay at public tariff rates and at owner's risk. The Contractor shall be liable to reimburse packing and incidental costs and charges incurred in such return or rejected stores in addition to other charges refundable as a consequence of rejection. The goods shall remain the property of the Contractor unless and until accepted by the Purchaser, after inspection.
Q.No.167. Describe in brief Earnest money deposit and Security deposit. Why it is required? And when it is required? In what condition it is exempted?
Ans. Earnest money deposit is taken to ensure earnestness of tenderers participating in a tender. EMD is 2% of the estimated tender value subject upper limit of Rs 5 Lakhs for tenders valuing up to Rs. 10 Cr and Rs 10 Lakh for tenders valuing above Rs. 10 Cr. EMD is liable to be forfeited in case offer is withdrawn within validity.
As soon as tender is decided, EMD of firms other than the firm on whom acceptance has been done, should be released. EMD can be exempted for firms registered with, Railway, NSIC and approved by RDSO/ICF/CORE/CLW/RCF for the item being tendered. Security Deposit is taken from the firm on whom tender is accepted to ensure supply against the PO SD is 10% of the PO value subject to maximum Rs 10 Lakh in case of PO up to Rs.10 Cr and Rs20 .Lakh in case of PO valuing more than Rs.10 Cr. SD can be exempted for firms registered with Rly, NSIC and approved by RDSO/CORE/ICF/CLW/DCW/DLW etc. In case of Safety item PO valuing more than Rs10 Lakh, SD should be taken but can be exempted based on merit of individual case.
Ans. Earnest money deposit is taken to ensure earnestness of tenderers participating in a tender. EMD is 2% of the estimated tender value subject upper limit of Rs 5 Lakhs for tenders valuing up to Rs. 10 Cr and Rs 10 Lakh for tenders valuing above Rs. 10 Cr. EMD is liable to be forfeited in case offer is withdrawn within validity.
As soon as tender is decided, EMD of firms other than the firm on whom acceptance has been done, should be released. EMD can be exempted for firms registered with, Railway, NSIC and approved by RDSO/ICF/CORE/CLW/RCF for the item being tendered. Security Deposit is taken from the firm on whom tender is accepted to ensure supply against the PO SD is 10% of the PO value subject to maximum Rs 10 Lakh in case of PO up to Rs.10 Cr and Rs20 .Lakh in case of PO valuing more than Rs.10 Cr. SD can be exempted for firms registered with Rly, NSIC and approved by RDSO/CORE/ICF/CLW/DCW/DLW etc. In case of Safety item PO valuing more than Rs10 Lakh, SD should be taken but can be exempted based on merit of individual case.
No comments:
Post a Comment