Menu Toggle
More
    Close

    Scrutiny

    Technical’ Scrutiny

    The case is first examined from the technical angle by a technical committee consisting of the Branch Officer concerned, technical officers of the Directorate and Indenting Department and some expert(s) of Industries or other Department/Institutions Where samples are to be examined, a representative of the Vigilance Department, not below the rank of a Deputy Superintendent of Police is to be associated. In case of purchases which fail within the competence of the Standing Purchase Committee (Lower), the technical scrutiny is done in the meeting of the Standing Purchase Committee itself because it already has such technical officers in its composition, and no separate examination by technical committee is required. Where no Standing /Special Purchase Committee exists and the purchase is to be finalized by the officers of the Directorate or Govt. the technical examination will be made by the technical committee as stated above. The meetings of the technical committee are required to be attended by experienced and qualified technical officers who must be Gazetted Officers.

    The technical committee shall make detailed, comprehensive and self contained recommendations regarding the technical validity of the offers / samples and wherever necessary suggest whether further clarifications may be sought from the tenderers to facilitate proper technical appraisal. In the event of any difference of opinion amongst the members of the technical committee, a meeting of the technical committee, shall be reconvened and the Director and the next senior technical officers of the Department / Institutions concerned or experts from other reputed organization of the State/Central Government may be invited for their expert opinion and even’ if still the difference persists, the matter may be referred by the Director to the competent authority but where such competent authority happens to be an officer subordinate to the Director, the matter shall be decided by the Director.

    The meeting of these Committees should be fixed within one week of the opening of the tenders and notice to the members of the Committees be issued at least one week before the opening of the tenders. As for as practicable, these members should be reminded on telephone also by the Branch Officer at least a day or two before the date fixed for the meeting to avoid unnecessary adjournments and delays.

    Commercial Scrutiny

    All the tenders are subjected to detailed commercial scrutiny with regards to the following

    Tender Fee

    Whether the tender has been received on the tender form or tender fee has been received along with the tender. This fact is to be mentioned in the relevant column of the comparative statement. Ordinarily all tenderers are required to submit their tenders on the prescribed tender form but due to certain compelling reasons it may not be possible for them to do so. As such, tenders received even on ‘Letter Head’ form are also entertained by this office provided these are complete in all respects namely rates, sales tax, other levies, delivery period, payment terms and specifications etc. But if such a tender is not accompanied by the tender fee in the form of Crossed Postal Order, or money order receipt even though the iffier is found to be technically valid and in order is ordinarily liable to be rejected. However, an opportunity is given by the Directorate to such tenderers to deposit the tender fee within a period not exceeding 10 days in the following cases namely

    • The tenderer is registered-with the D G S & D or Director Supplies & Disposals, Haryana, or N.S.I.C
    • The tenderer is a firm of great repute and is a known/genuine manu facturer/supplier
    • Where the difference in rates quoted by such a tenderer and the next higher valid tenderer is so high that in the Opinion of the Directorate it would not be in the public interest to ignore this offer simply on this ground
    • Where most of the tenders suffer from this infirmity and other technical or commercial lacuna and it is considered necessary for the proper evaluation of the tenders to seek additional information/clarification etc. from all or some of these tenderers.

    Where, however, the purchase is to be finalized by the officers of the Directo rate within their delegation, above action is taken with the approval of the Director Supplies & Disposals, but where the Government is competent authority for the finalization of purchase beyond Rs. 2.50 lacs or in rate contract case action as above is taken by the Directorate and the recommendations are made accordingly to Government, for approval of the action taken.

    No tender fee is however required to be deposited by the tenderers in case of short term quotations/spot purchase.

    Tender Documents

    All tenderers are required to send the tender documents including the instructions to the tenderers and Schedule ‘B’ duly signed along withi tender, but some times it is found that the tenderers do not comply with this requirements for various reasons. This fact should be clearly brought out by the dealing assistant in the relevant column. The tenders are not rejected simply, on this ground, but an opportunity is given to the tenderers to complete the formalities within a period not exceeding 15 days failing which the offers are straightaway rejected.

    These are very crucial and legal documents and their execution is obligatory for the finalization of the contract. The dealing assistants must, therefore, ensure that before issuing the supply order, this formality has been completed in all respects.

    Earnest Money

    The fact whether the earnest money has been sent along with the tender or not should be clearly mentioned in the relevant column of the comparative statement. In certain cases the tenderers may not be sending the earnest money on the ground that they are registered with the DGS & D/Director Supplies & Disposals/or and N.S.I.C. and may mention this fact in the tender. Some tenderers may seek exemption from depositing earnest money on the ground that they are Public Sector Undertakings of State/Central Government. “This fact should be clearly brought out in the comparative statement.

    According to Stores Purchase Rule 12 (ii) and (iii) the following are exempted from depositing the earnest money

    • Firms registered with DGS & D
    • Firms registered with the Director Supplies & Disposals, Haryana
    • Firms of repute
    • Where the value of stores is less than Rs. 2000/- and quotations are invited

    The Purchase Committee can normally, however, in their discretion to give exemption to the parties in spot purchase cases.

    All the tenderers claiming exemption on these grounds especially (i) and (ii) above, are required to quote their registration number and also attach a photostat copy of the registration number, but sometime they may not do so. Where the office is aware on the basis of the record/knowledge that the particular firm claiming exemption is entitled to it, it should not insist on procuring the photostat copy of the registration number. According to the relevant Purchase Rules referred to above the officer competent to accept the tender is also competent to waive this condition. The Government instruction vide, their letter No. 8770-61B-67/ 17730,. dated 10-8-67. have given these powers to the Standing Purchase Committees to relax this condition in public interest.

    However, in public interest, the tenderers may be given an opportunity to deposit the earnest money even after the opening of tenders by the Competent authority in the following cases namely

    • The offer is technically valid and otherwise acceptable, but for this or other minor deficiencies such as tender fee or signing of Schedule’s’
    • The tenderer has referred to old deposit with relevant detail which . is not available as having been released in the meanwhile or is not free and the offer is otherwise technically valid and acceptable
    • The difference in rates between the two technically valid offers is considered to be substantial

    The tenderers are required to send the earnest money in the shape of Call deposit receipt/F.D.R., but sometimes they send it in the form of Bank draft/Pay order which are valid for a short period. This fact should be clearly brought out in the comparative statement. Such tenderers are given opportunity to replace such Bank drafts/Pay orders by Call Deposit Receipt/F.D.R.

    In case of short delivery period which is covered by the validity of the Bank draft, this need not be insisted upon. The Bank drafts/Pay orders should be returned only after the receipt of the new deposit in proper form.

    Price

    The tenderers are . required to quote price per unit as mentioned in the NIT, F.O.R, destination, Sales Tax, Excise duty & other taxes, erection charges etc. etc. But it has been observed that they do not strictly comply with this requirement and quote for different units and different F.O.R.’s with the result that it becomes necessary to workout the price per unit F.O.R, destination after taking into consideration all the relevant factors for the purpose of comparison of rates.

    It is the duty of the office to workout the rates as per unit in the NIT. For instance, if any tenderer has quoted rates per kg. but as per NIT he was required to quote rates per Metric Ton, the office shall multiply the rates quoted by 1000 so as to work out the rate per metric ton. Similarly, if in the NIT it is required to have the rates per sq. metre, but the tenderer quotes rates per sheet giving the size measuring 2 metre x 1 metre, the office shall divide the quoted rates by 2 so as to workout the rates per sq. metre.

    Where, however, it is found that the rates quoted in terms of unit cannot be converted into the unit required in the NIT by any available technical method-or keeping in view the tolerance prescribed in the ISS, the tenders are ordinarily rejected as not being as per NIT unless the competent authority thinks in public interest that the additional information should be obtained from the tenderer to facilitate conversion in terms of the required unit.

    F.O.R

    Invariably, the tenderers are required to quote their rates F.O.R. desti nations which are mentioned in the NIT, but some tenderers may quoted F.O.R. dispatching station or ex-works etc. In such circumstances it becomes difficult to make the comparison of rates, without having the necessary data regarding freight charges, packing and forwarding charges etc. In such cases the inquiries are made from the Railway authorities as well as from the parties as to the incidence of such charges. After the receipt of this information, the office should incorporate this information in red ink giving reference to the page number of the relevant letter containing this information.

    Sales Tax/Excise Duty & other Levies

    It is specifically provided in the NIT and also in the tender document that taxes and duties must be mentioned in the tender failing which it would be pre sumed that the rates are inclusive of all such taxes. This fact is clearly brought out in the comparative statement. Under the sales tax Law, the Government Departments are entitled to concessional rate of taxation on furnishing certain declaration forms. The tenderers are required to categorically state the relevant declaration form to be furnished by the Government Department concerned but there may be cases where the Department may not be competent to furnish the form demanded by the firm. As for instance, STXV can be furnished only by such Departments which are registered as dealers for the resale and distribution of product under the Sales Tax Act and not by any other Government Departments. In such cases the office must check up from the Indenting Department concerned and also from the Excise and Taxation Department as to whether such a form can be furnished by the. Indenting Department or not. In case the Indenting Department cannot issue such a form, the sales tax will become payable by the Department, and will have to be taken into account for the purpose of comparison of rates. While evaluating offers, competent authority must also take into account this point.

    In case of offers in which no extra sales tax is asked for or offer is in clusive of sales tax, the tenderers are required to mention the relevant declaration form to be furnished by the Government Departments, but if they do not do so, even then if under the relevant provisions of the Sales Tax Act such a declaration form has statutorily to be furnished by the Government Departments, this has to be allowed and a mention be made in the supply order to that effect because the Government Departments are entitled to concessional rate of taxation only on furnishing such declaration form.

    Where a tenderer has asked for excise duty extra, but has not mentioned the quantum thereof, he is asked to clearly indicate the quantum of such duty and on receipt of this information this is to be clearly mentioned in the comparative statement and taken into account for the comparison of rates.

    Erection Charges

    Where in the NIT, the tenderers have been required to quote the erection charges of the equipment etc. but they do not do so in this respect, the rates are taken to be inclusive of the erection charges. But where the tenderers simply mention that the erection charges would be extra, but do not specify the amount and the competent authority considers it necessary to ascertain such amount from the tenderer for the proper evaluation of the rates, a reference is made to them in this respect and information so received is incorporated in the comparative statement in the red ink giving reference to the relevant letter of the tenderer.

    Discount

    The office is required to mention all kind of discount in the comparative statement as offered by the tenderers. Normally following types of discounts are offered by the firm.

    Discount for Prompt Payment (Cash Discount) Within Usual Payment Terms : Such discount is to be availed of and taken into consideration for the purpose of gradation. If such discount is offered on abnormal payment terms e.g. 100% payment ex-works or advance payment, 100% payment against R/R etc. which are not acceptable terms of payment, such discount should be ignored
    Trade Discount : The unconditional trade discount must be taken into consideration. Where it is hedged in by certain conditions e.g. discount on full or specified quantity or value of order, or if order is placed within certain specified period etc. and the competent authority feels that the terms are acceptable, such a discount should also be taken into considerations for the purpose of comparison of rates but if the competent authority feels that the terms are onerous and it is difficult to avail of the discount, such a discount shall not be taken into consideration. But the office must indicate it in the comparative statement in red ink clearly

    Price Preference

    The element of price preference is very important component for the purposes of gradation. It must, therefore, be specifically and clearly brought out in the comparative statement by the office and closely scrutinized by the competent authority while evaluating the officers. The procedure to be followed has been brought out in detail in Chapter IV of this manual.

    Net Price & Gradation

    After taking into account all the above factors, the nett price shall be worked out and recorded in red ink in the comparative statement by the office.

    The nett rates so worked out form the basis of gradation of rates in the ascending orders starting from the lowest rates and going/upwards. The grades, should be recorded in bold Arabic numerals in red ink and should be encircled. No over writing should be made under any circumstances and if it becomes necessary to change the gradation it should be recorded afresh after scoring out and initialing it.

    Price Variation

    No price variation is normally allowed except in very few cases where such price variation is considered to be unavoidable by the competent authority.

    It has been provided in Annexure ‘A’ (i.e. conditions of the tender form) that the offers with price variation clause will not be accepted. Wherever the tenderer Make such ail offer the fact should be clearly brought out in the relevant column and the competent authority should consider whether price variation should be accepted or not. Where all or most of the tenderers include such a clause and the competent authority feels that it would be in public interest to accept this clause, these should be allowed as a special case. In such cases a specific formula is given by the tenderer in the offer itself. It should be got very carefully scrutinized by the technical experts before acceptance and if need be the tenderer should be called for detailed discussion of the formula.

    “64-A. In contracts of sale, amount of increased or decreased taxes to be added or deducted

    Unless a different intention appears from the terms of the contract, in the event of any tax of the nature described in sub-section (2) being imposed, in creased, decreased or remitted in respect of any goods after the making of any contract for the sale or purchase of such goods without stipulation as to the payment of tax where tax was not chargeable at the time of the making of the contract, or for the sale or purchase of such goods tax-paid where tax was chargeable at that time.

    • If such imposition or increase so takes effect that the tax or increased tax, as the case may be, or any part of such tax is paid or is payable, the seller may add so much to the contract price as will be equivalent to the amount paid or payable in respect of such tax or increase of tax, and he shall be entitled to be paid and to sue for and recover such addition
    • If such decrease or remission so takes effect that the decreased tax only, or no tax as the case may be, is payable the buyer may deduct so much from the contract price as will be equivalent to the decrease of tax or remitted tax, and he shall not be liable to pay, or be sued for, or in respect of, such deduction

    The provisions of sub-section (1) apply to the following taxes namely

    1. Any duty of customs or excise on goods
    2. Any tax on the sale or purchase of goods

    In view of the above provision of the Act, such increase or decrease in the levies on the stores in question has to be invariably allowed, but before doing so the parties have to produce the necessary documentary evidence in support thereof. The stipulation regarding the variation in statutory levies on the finished products should be made in the supply order very categorically where the firms ask for in their tender. But no such extra levy on the raw material used in the manufacture of stores in question has to be allowed in any case.. The advice of L.R. sought in a case is reproduced in annexure III to this Chapter.

    In case of controlled items or where the price of product is regulated by certain orders of the Government of India or State Government, the price variation has to be allowed accordingly and a stipulation of this kind has to be made in the Supply order where the firms so demand. For instance in the case of certain medicines which are covered by the Drug Price Control order, such variation (inc crease or decrease) has to be allowed on the production of documentary evidence from the parties concerned and such variation is to take effect from the date of issue of the relevant Government orders.

    Payment Terms

    In clause 10 of the annexure ‘A’ of the tender form captioned “Conditions with tender form” it has been provided as under

    “90 % payment can be made through bank against R/R supported with satisfactory inspection note and balance within 30 days of the receipt of stores provided the stores are booked at railway risk. The bank commission shall be borne by the contractor “.

    Different tenderers, however, quote different payment terms. These payment terms should be clearly brought out in the relevant column of the comparative statement by the office and closely scrutinized by the competent authority. The following payment terms are, however, not accepted.

    • Where the tenderers ask for any advance payment along with supply order
    • Where the tenderer ask for payment through bank or otherwise against G/R
    • Where erection of any equipment is involved and any tenderer asks, for more than 90 % payment against R/R and inspection note

    However, exception may be made in the case of purchase falling in category (i) above by the competent authority where stores involved are of such a nature that it cannot be procured from any other source or on any different terms.

    Normally the following payment terms are offered by the firms viz :—98 % payment or 95 % payment against R/R supported with in­spection note through bank and balance 2 % or 5 % within 30 days of correct receipt of goods at destination or 100% payment against physical delivery of inspected and accepted goods to the consignee at destination provided the supplies have been made within the stipulated or extended delivery period in correct condition.

    These payment terms are normally accepted by the competent authority in the interest of expeditious purchase.

    Where, however, payment terms which are normally not acceptable or which are not considered reasonable by the competent authority in the public interest, keeping in view the nature of the stores involved, a counter offer is made to the firm within the period of validity and in case the firm so agrees, the modified terms of payment are accepted by the competent authority but if the firm does not agree, the case is to be decided by the competent authority on merits. In the Government instructions contained in Memo No. 770-61B-67/17730 dated 10-8-1967 the Purchase Committees are the competent authority to relax the rule in the matter of payment terms but where such Purchase Committees do not exist and the purchases are to be finalized by the officers of the Directorate within the power of delegation, the matter is referred to the Government for allowing relaxation in normal payment terms i.e. 90%—10%.

    Delivery Period

    The delivery period is required to be mentioned by the Indenting Officer in their indents and the same is notified in the NIT. The different tenderers quote different delivery period depending upon their capacity, commitments and avail ability. The delivery period is of great importance in the purchase programme because the Indenting Departments have to plan their work schedules accordingly. Moreover, once the delivery period is settled, it becomes the essence of the contract. As such the delivery period quoted by the tenderers in their offers should be very carefully indicated in the relevant column of the comparative statement by the office.

    Normally, the following types of stipulations are made by the tenderers while quoting the delivery period

    • Ready stock
    • Ready stock subject to prior sale
    • Within the specified period from the date of receipt of the confirmed supply order e.g. 2 months, 3 months etc
    • The supply is to commence within the definite period from the date of receipt of the supply order and completed in a definite given period thereof e.g. the supply to start within 15 days from the of order and be completed within 3 months
    • The supply will be made in a phased manner on a monthly, quarterly or yearly basis after commencing from certain definite date from the receipt of the supply order
    • The supply is to be completed within 2 to 6 months etc

    If the offers are otherwise found to be in order in all respects but the delivery period offered by the firm does not suit the Indenting Officer, it is customary to negotiate the same with the firm and stress upon the firm agreeing to it. The modified delivery period is accepted by the competent authority but if the firm does not agree, and the requirement of the Indenting Officer is of such a nature that it cannot be postponed, the offer even though lower is rejected and the next higher offer with suitable delivery period suited to the requirement of the Indenting Officer is considered for acceptance. Where no definite period is indicated e.g. 2 to 6 months, it is the discretion of the firm to complete the supply within 2 months or any period extending upto 6 months and the firm cannot be penalized for not completing the supply within the minimum period quoted i.e. 2 months in the instant case. This is only when the firm is not able to complete the supplies upto the expiry of 6 months period, that the firm can be penalized for delay.

    While ignoring lower offers, only on the basis of longer delivery period, a considerable amount of thought” should be given by the competent authority and the Indenting Officer should be asked to categorically, state that he cannot afford to wait for the supplies to be completed by such a tenderer and such views of the Indenting Officer should be brought on record.

    Test Reports/Licences/Samples

    In the indent, the Indenting Officers generally indicate whether they want test report, copies of licences (ISI, Drug, Pesticides, C.I.B. etc.) for the proper technical evaluation of the tenders.

    This is stipulated in the NIT for the compliance by the tenderers. While preparing the comparative statement the office must take careful note of it and make entries in the relevant-column in the comparative statement by using word ‘Yes’ or No’.

    The Technical committee scrutinizes these documents and samples very care fully and on the basis thereof makes clear cut and suitable recommendations.

    But there may be cases where none of the tenderers has submitted any test report or complete test report or copies of licences or sample . In such cases, the technical committee may recommend either re-invitation of tenders or give equal opportunity to all the tenderers to make up these deficiencies. Ordinarily, where none of the tenderers has submitted a test report/tested sample or copy of the licence, it is better to give an equal opportunity to them to submit test report/ tested sample, licence etc. rather than straightaway deciding upon re-invitation of tenders. But this opportunity may be given even to such tenderers whose rates happen to be comparatively higher vis-a-vis the lower rates quoted by other tenderers if the technical committee is of the view that it would be in public interest to do so taking into consideration the standing of such tenderers and their past performance.

    It may also happen that the ISI licence or other licences sent by the parties have ceased to be valid or their validity is likely to expire during the pendency of the purchase proceedings. Such offers have not to be rejected straightaway simply on the ground because renewal or extension of the license is a time consuming process and the firms may represent that the renewal/extension is under process with the competent authorities. In such cases, the technical committee normally re commends acceptance of the offer if the licence is otherwise in order and the firm promises to produce the requisite valid licence at the time of inspection subject to the condition that the supplies will be accepted only when such licence is actually produced by the tenderer.

    These recommendations of the technical committee are considered by the competent authority and decisions are taken on merit. However, in the case of Standing Purchase Committee (Higher) and High Powered Committee, action on the recommendations of the technical committee is taken in anticipation and the facts are reported to these Committees in the Agenda note circulated in this behalf.

    General terms and conditions

    Given by the tenderer in the offer should be seen to ensure that no terms/or condition is ambiguous or vague or contrary to NIT. In case such a term or condition comes to the notice clarification may be sought from the firm or the firm should be asked to withdraw the same.

    Validity of offer

    The rates are usually valid for a specific period which is given in the tender itself. Normally it is sixty days. This fact should be clearly brought out in the relevant column of the comparative statement by the office. An effort should be made by competent authority to take a decision in the case before the expiry of the validity of the offers. In case it is visualized that the decision will not be possible within a validity period the tenderers should be re quested to extend the validity period. In case tenderer(s) does/do not extend the validity of offer, the offer is treated as withdrawn.

    Normally a firm is free to withdraw its offer if a decision is not conveyed within the validity period of the offer. However, a condition is stipulated in the NIT to the effect that if the offer is withdrawn within its validity period, the tenderer will be liable to suitable action. The advice of L.R on the subject are contained in Annexure IV to this Chapter

    Antecedents 6f Tenders

    The office will point out if the tender has been suspended debarred / banned from transacting business with Government.

    Validity of Tenders

    A tender will be invalid if

    • It is a belated one
    • If it is not accompanied by the earnest money or tender fee
    • If it is for a store which is not strictly according to the prescribed specifications
    • If the offer is not accompanied by sample/test report (where required)
    • If the tender does not conform to the prescribed terms and conditions of supply

    When valid & reasonable tenders received within time are available late tenders should be summarily rejected. No effort should be made to have a grossly belated tender accepted under the plea that the rates are lower especially when equal opportunity has been given through press advertisement to all the suppliers.

    In arriving at a proper deicision a distinction has to be made between invalidity of an offer on account of not conforming to the required specifications and certain other information like not depositing of earnest money and non filing of tender with schedule ‘A’ or ‘B’. If the lowest offer is not of required specifications, it has to be ignored. However, if the lowest offer suffers from minor procedural drawbacks, the proposals have to be submitted to competent authority for relaxation of the same are in public interest. Government as a prudent purchaser should always keep in mind the financial interests.

    Where a valid tender has been received, it should not be rejected unless the competent authority feels that the response is poor or fresh quotations in his opinion, are likely to be beneficial to Government. All such cases where re-invitation of tenders is considered necessary shall be brought to the notice of Director Supplies & Disposals and his orders obtained their on.

    Clarifications and additional information

    In case an offer is silent on technical or commercial point, the tender may be asked to send the information or if some particulars already supplied in the offer are not clear, the tenderer may be asked to clarify the position. In doing so care must be taken to ensure that the tenderers are not allowed to improve upon the offer vis-a-vis offers of other tenderers either technically or commercially.