contracts and procurement manual

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CONTRACTS AND PROCUREMENT

MANUAL

January 2020

Document downloaded on 09-04-2022 07:07:28 by

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TABLE OF CONTENTS

CLAUSE NO. SUBJECT PAGE NO.

SECTION-I INTRODUCTION 12

1.0 INTRODUCTION 12

2.0 OBJECTIVE 12

3.0 IDENTIFICATION OF RESPONSIBILITIES 12

4.0 INITIATION OF PROCUREMENT/ WORKS / SERVICE 16

4.1 PACKAGE DESIGN 16

4.2 SPECIFICATION 17

4.3 TIME SCHEDULE/DELIVERY REQUIREMENT 19

4.4 QUANTITY 19

5.0 COST ESTIMATE 20

6.0 RAISING PURCHASE / SERVICE REQUISITION 22

SECTION-II PRE AWARD CONTRACT MANAGEMENT 23

1. FORMATION OF TENDER COMMITTEE (TC) 23

2. PREPARATION OF BID DOCUMENT 23

3. METHOD OF PROCUREMENT 24

4. INVITATION OF BIDS / TYPES OF TENDER 24

4.1. OPEN DOMESTIC TENDERS 24

4.2. LIMITED DOMESTIC TENDERS 25

4.2.1. VENDOR LIST FOR LIMITED TENDERING 25

4.3. OPEN INTERNATIONAL COMPETITIVE BIDDING (ICB) 26

4.4. LIMITED INTERNATIONAL COMPETITIVE BIDDING

(LICB) 26


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4.5. SINGLE ACCEPTABLE BID 26

4.6. PROCUREMENT OF PROPRIETARY ITEMS / OEM /

SERVICES 27

4.7. PROCUREMENT ON NOMINATION BASIS 30

4.8. PETTY PURCHASES / WORKS / SERVICES 33

4.9. PURCHASES / WORKS / SERVICES THROUGH BOARD

OF OFFICERS 33

4.10. EMERGENCY PURCHASE OF MATERIALS, WORKS

AND SERVICES: 34

4.11.

PROCUREMENT OF MATERIALS, WORKS AND

SERVICES THROUGH RATE CONTRACTS / ANNUAL

MAINTENANCE CONTRACTS

34

4.12. FRAME WORK AGREEMENT 36

4.13.

PURCHASE FROM GOVERNMENTAL CO-OPERATIVE

COMMERCIAL OUTLETS SUCH AS KENDRIYA

BHANDAR OR SIMILAR DESIGNATED CO- OPERATIVE

BODIES/STATE EMPORIUM

36

4.14. EXPRESSION OF INTEREST (EOI) 36

4.15. QUALITY AND COST BASED SELECTION (QCBS) FOR

SERVICES 37

5. BIDDING SYSTEM - SINGLE BID AND TWO BID

SYSTEM 38

5.1. SINGLE BID / SINGLE ENVELOPE SYSTEM 38

5.2. TWO BID / TWO ENVELOPES SYSTEM 39

6. BID EVALUATION CRITERIA 41

6.1 FINANCIAL CRITERIA 42

6.2 TECHNICAL CRITERIA 43

7. ISSUE / SALE OF BID DOCUMENTS 47


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7.1 PROCEDURE FOR ISSUE OF LIMITED/ OPEN

TENDERS 48

7.2 NOTICE INVITING TENDER (NIT) 48

8. NUMBER OF COPIES OF OFFERS 49

9. REASONABLE TIME FOR BID SUBMISSION 50

10. BID VALIDITY 50

11. PRE-TENDER CONFERENCE & PRE BID MEETING 51

12. RECEIPT OF BIDS 52

13. OPENING OF TENDERS 53

13.1 NUMBERING OF TENDERS 53

13.2 DISCLOSURE OF PRICES / READING OUT THE RATES 53

13.3 EXTENSION OF BID SUBMISSION DATE 54

13.4 E-MAIL OFFERS 54

14. BID SECURITY / EARNEST MONEY DEPOSIT (EMD) 54

14.1 EXEMPTION FROM SUBMISSION OF BID SECURITY 55

14.2 AMOUNT OF BID SECURITY 55

14.3 EXTENSION OF BID SECURITY 55

14.4 FORFEITURE OF BID SECURITY 55

14.5 RETURN OF BID SECURITY 56

14.6 MODE OF SUBMISSION OF BID SECURITY 56

14.7 EXAMINATION AND VERIFICATION OF BANK

GUARANTEE 57

15. PERFORMANCE BANK GUARANTEE (PBG) / SECURITY

DEPOSIT (SD) 58

15.1 CONTRACT PERFORMANCE BANK GUARANTEE

(CPBG) FOR EXTRA WORKS 59


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15.2

REDUCTION IN CONTRACT PERFORMANCE BANK

GUARANTEE (CPBG)/ SECURITY DEPOSIT (SD) IN

CASE OF REDUCTION IN THE SCOPE OF WORK 59

16. UNSECURED ADVANCE ON PROPRIETORY IMPORT 60

17. E-PAYMENTS 60

18. REPEAT ODER 60

19. PURCHASE OF CAPITAL ITEMS AND SPARES

THEREOF 61

20. CLAUSES IN SUPPLY ORDER/INVITATION OF

TENDERS 61

20.1. WARRANTY AND GUARANTEE 61

20.2. FAILURE AND TERMINATION CLAUSE 62

20.3. FALL CLAUSE 63

20.4. INSPECTION AND REJECTION OF MATERIALS BY

CONSIGNEE 64

20.5. SUBLETTING ASSIGNMENT 65

20.6. EARLIER DELIVERY 65

20.7. PILOT APPROVAL 66

20.8. BULK INSPECTION 66

20.9. GENERAL CONDITIONS 67

20.10. RESOLUTION OF DISPUTES / ARBITRATION 67

20.11. LOADING AND REJECTION CRITERIA 67

20.12. ABNORMALLY HIGH RATES ITEMS 69

20.13. PERCENTAGE TENDERING 69

20.14. PROCEDURE FOR BUY BACK ITEMS AND TENDER

PROVISIONS 70


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20.15. PROVISION WITH RESPECT TO TAXES IN RFO/

TENDER DOCUMENT 71

20.16.

PROVISION WITH REGARD TO LIQUIDATION,

BANKRUPTCY OR COURT RECEIVERSHIP IN TENDER

DOCUMENTS

75

20.17.

NON APPLICABILITY OF RBITRATION CLAUSE IN

CASE OF BANNING OF VENDORS, SUPPLIERS,

CONTRACTOR, BIDDERS, AND CONSULTANTS

INDULGED IN FRAUDULENT/COERCIVE PRACTICES.

75

20.18.

PROVISION IN TENDER REGARDING PERMANENT

ESTABLISHMENT (PE) W.R.T. FOREIGN BIDDERS 76

20.19. PEGGING OF FEE PAYABLE TO THE CONSULTANT 78

20.20. TRADE RECEIVABLE DISCOUNTING SYSTEM (TREDS) 78

20.21. APPLICABILITY OF INTEREST ON MOBILIZATION

ADVANCE/ADVANCE 78

20.22. DIRECT PAYMENTS TO SUB-VENDORS / SUPPORTING

AGENCIES OF MAIN CONTRACTOR 80

20.23. ZERO DEVIATION BID 80

21. INTEGRITY PACT 80

22. EVALUATION OF BIDS 81

22.1. EVALUATION OF SINGLE STAGE COMPOSITE BIDS 81

22.2. EVALUATION OF BID UNDER SINGLE STAGE TWO BID

SYSTEM 81

22.3. CONDITIONAL & UNSOLICITED DISCOUNT 82

22.4. CLARIFICATION FROM BIDDERS AFTER TENDER

OPENING 82

22.5. COMPOSITE BID 82

22.6. TWO BID SYSTEM 83


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22.7. CORRESPONDENCE WITH BIDDERS 83

22.8. COMPARISON OF BIDS 83

22.9. GUIDELINES FOR SCRUTINY/COMPARISON OF BIDS 84

23. TENDERS NOT IN PRESCRIBED FORMS 86

24. LATE BIDS 88

25. BID WITHDRAWAL 88

26. FURNISHING FRAUDULENT INFORMATION /

DOCUMENT 88

27. ACCEPTANCE OF RECOMMENDATION OF TENDER

COMMITTEE 88

28. BID REJECTION CRITERIA 89

29. RULES FOR PLACEMENT OF ORDER 89

30. STANDARD FORM OFCONTRACT/SUPPLY ORDERS 90

31. SPLITTING OF TENDERS/SUPPLY ORDER 91

32. SPLITTING OF QUANTITIES 91

33. INSUFFICIENT ACCEPTABLE BIDS 92

34. THE REASONABILITY OF PRICE 92

35. NEGOTIATIONS 93

36. ISSUING LETTER OF ACCEPTANCE / LETTER OF

INTENT / PURCHASE / WORK ORDERS 94

37. PRICE REDUCTION SCHEDULE 95

38. CANCELLATION / RE-INVITATION OF TENDERS 95

38.1 CANCELLATION OF TENDERS 95

38.2 RE-INVITATION OF TENDERS 96

39. E-TENDERING 96


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40. ELECTRONIC REVERSE AUCTION 97

41. COMPLAINTS/REPRESENTATION-CONSIDERATION 100

42. LEAD TIME IN PROCESSING OF PR/SR AND

MONITORING THEREOF 100

43. DEVIATION TO THE MANUAL 101

44. AMENDMENT TO THE MANUAL 101

SECTION-III GUIDELINE FOR POST AWARD MANAGEMENT OF

CONTRACT /PURCHASE ORDER 102

1. GUIDELINES FOR POST AWARD ACTIVITIES 102

1.1 ISSUANCE OF DETAILED CONTRACT / PURCHASE

ORDER 102

1.2 PERFORMANCE BANK GUARANTEE / SECURITY

DEPOSIT 102

1.3 SIGNING OF THE AGREEMENT 102

1.4 FOLLOW- UP 102

1.5

MANAGEMENT OF SECURITY DEPOSIT (SD) /

PERFORMANCE BANK GUARANTEE (PBG) AND CLAIM

SETTLEMENT

103

2. CHANGE ORDER 104

2.1 CHANGE ORDER PROCESS 104

2.2 VARIATION IN QUANTITY 105

3.

INLANT TRANSPORTATION/ SHIPMENT/ DISPATCH &

SHIPPING DETAILS / CUSTOMS CLEARANCE/ LETTER

OF CREDIT / EXPORT PROCEDURE

105

3.1 INLAND TRANSPORTATION 105

3.2 SHIPMENT OF IMPORTED GOODS 106

3.3 TRANSIT RISK INSURANCE 108


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3.4 ADVANCE INTIMATION OF DISPATCH / SHIPMENT 109

3.5 CUSTOM CLEARANCE 109

4. INSPECTION OF MATERIAL / WORKS / SERVICES 110

4.1 JOINT MEASUREMENT OF WORK EXECUTED 110

5. TIME EXTENSION FOR ONGOING CONTRACT 111

6. APPLICABILITY OF PRICE REDUCTION 113

7. BILL WATCH SYSTEM 113

8. PAYMENT PROCEDURE 113

9. LETTER OF CREDIT 114

10. MILESTONE PAYMENT 120

11. PRICE ESCALATION AND ADJUSTMENT 120

12. EXTENDED STAY COMPENSATION 121

13. CHANGE IN TAXES AND DUTIES AND OTHER

STATUTORY CHANGES 124

14. CLOSURE OF PURCAHSE ORDER AND WORKS

CONTRACT 125

15.

EVALUATION OF PERFORMANCE OF VENDORS/

CONTRACTORS / CONSULTANTS 126

SECTION-IV PROCEDURE FOR SELECTION OF CONSULTANTS 127

ANNEXURES-I CHECKLIST FOR MONITORING OF PURCHASE

ORDER/CONTRACT 157

ANNEXURES-II POST ORDER MONITORING (PROCUREMENT) 159

ANNEXURES-III POST ORDER MONITORING (PROCUREMENT) 160

SECTION-V APPENDICES 161


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APPENDIX-I METHODOLGY FOR EVALUATION OF FINANCIAL

CRITERIA OF BEC 161

APPENDIX-II GENERAL PURCHASE CONDITIONS FOR LIMITED

TENDERING UPTO RS. 5 LAKH 168

APPENDIX-III GENERAL PURCHASE CONDITIONS FOR DOMESTIC

OEM/ PROPRIETARY 173

APPENDIX-IV GENERAL PURCHASE CONDITIONS FOR OVERSEAS

OEM/ PROPRIETARY 177

APPENDIX-V PROCEDURE FOR ISSUANCE OF

COMPLETION/EXECUTION CERTIFICATE 183

APPENDIX-VI PROFORMAS 185

ANNEXURE-1 COMPLETION CERTIFICATE TO BE ISSUED AGAINST

CONTRACTS FOR SERVICES/CONSULTANCY/WORK 185

ANNEXURE-2

COMPLETION CERTIFICATE TO BE ISSUED AGAINST

ORDER FOR SUPPLY OF GOODS ALONG WITH

SERVICES

186

ANNEXURE-3

EXECUTION CERTIFICATE TO BE ISSUED AGAINST

RATE/ MAINTENANCE CONTRACT FOR SUPPLIES/

SERVICES/ CONSULTANCY/WORKS 187

APPENDIX-VII

PROCEDURE FOR EVALUATION OF PERFORMANCE

OF VENDORS/ CONTRACTORS/ CONSULTANTS 188

APPENDIX-VIII FORMATS 193

ANNEXURE-1 PERFORMANCE RATING DATA SHEET (FOR

PROJECTS/ CONSULTANCY JOBS) 193

ANNEXURE-2 PERFORMANCE RATING DATA SHEET (FOR O&M) 197

APPENDIX-IX

PROCEDURE FOR PUTTING AN AGENCY ON HOLIDAY

AND BANNING LIST 201

APPENDIX-X CHECKLIST FOR PRE-AWARD ACTIVITIES 207


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ANNEXURE-1 CHECK LIST FOR RECOMMENDATION/ PROPOSAL

FOR BEC, EVALUATION METHODOLOGY ETC. 208

ANNEXURE-2

CHECK LIST FOR PROPOSAL FOR ISSUANCE OF

RFQ/TENDER (OEM/ PROPRIETARY/NOMINATION/

CASES WHERE BEC IS NOT REQUIRED)

209

ANNEXURE-3 CHECK LIST FOR RECOMMENDATION/ PROPOSAL

FOR PRICE BID OPENING 210

ANNEXURE-4 CHECKLIST FOR RECOMMENDATION/ PROPOSAL FOR

AWARD 212

APPENDIX-XI PRINCIPLE GUIDELINES FOR INTEGRITY PACT

214

APPENDIX-XII PROPRIETARY ARTICLE CERTIFICATE 224


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SECTION-I

INTRODUCTION

1. INTRODUCTION

Petronet LNG Limited is a Joint Venture Company, promoted by four Oil majors

ONGC, IOCL, GAIL & BPCL. The company was formed with the objective to import

LNG into India and bridge the gas supply deficit faced by the nation, by setting up

regasification terminals and entering into LNG sale and Purchase contracts. The

company started its operation in 2004.

2. OBJECTIVE

Objective of this manual is to provide the broad guidelines to be followed across

the organization for procurement of material, goods, equipment services and

award of Contract on turnkey basis for projects, operation & maintenance, turnkey

contracts and other assets. The following are the primary objective for the manual:

a) Economy and efficiency in procurement.

b) Transparency in procurement process

c) Uniformity in the procurement process across the company

d) Accountability

e) Compliance to statutory guideline if any

3. IDENTIFICATION OF RESPONSIBILITIES

The division of responsibility of contracts management (both pre-award and post

award) between various departments / groups vested with the overall

responsibility of execution of various projects of the Company, at various locations

is summarized below. This division of responsibility is only for guideline so that

confusion in day to day functioning, may be avoided for reasons of overlapping

of functional requirements and lack of clarity in that respect.

Sl. No. ACTIVITY RESPONSIBILITY GROUP/DEPT.

IN PLL

1 TIMING OF TENDERING PROJECT / INDENTOR / USER

DEPT.


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2 SCOPE A ND SPECIFICATIONS PROJECT / INDENTOR / USER

DEPT.

3 TIME SCHEDULE / DELIVERY REQMT. PROJECT / INDENTOR / USER

DEPT.

4 COST ESTIMATE PROJECT / INDENTOR / USER

DEPT.

5 SANCTION FOR EXPENDITURE PROJECT / INDENTOR / USER

DEPT.

6 PRE-TENDER CONFERENCE PROJECT / INDENTOR / USER

DEPT., C&P

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BID EVALUATION CRITERIA (BEC)

ELIGIBILTY QUALIFICATION /

EVALUATION METHODOLOGY

TENDER COMMITTEE

A. TECHNICAL ASPECTSPROJECT / INDENTOR / USER

DEPT.

B. FINANCIAL ASPECTSC&P IN ASSOCIATION WITH

FINANCE

C. GENERAL COMPLIANCE TO

PROCEDURE C&P, INDENTOR

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GENERAL CONTRACT CONDITIONS C&P

SPECIAL CONDITIONS of CONTRACT INDENTOR,/ USER DEPT

9 FIXING OF BID SECURITY / EMD

AMOUNT C&P

10 FIXING COST OF TENDER

DOCUMENT C&P

11 PREPARATION OF TENDER

DOCUMENT C&P

12 VETTING OF TENDER DOCUMENTS

(not required if standard GCC are there)

FINANCE, LEGAL, INDENTOR

13 APPROVAL OF TENDER DOCUMENT

BEFORE FLOATING COMPETENT AUTHORITY


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14 ISSUE OF NIT / TENDER DOCUMENT C&P / ADMIN DEPTT.

15 RESPONSE TO QUERIES RAISED BY

BIDDERS AGAINST TENDER

A. TECHNICAL

TO BE COMMENTED BY

TECHNICAL DEPTT. &

RESPONDED BY C&P

B. COMMERCIALC&P IN CONSULTATION WITH

FINANCE

16 PRE-BID CONFERENCE

INDENTOR, USER DEPT.

ASSOCIATION WITH FINANCE&

C&P,

17 RECEIPT OF BIDS C&P

18 OPENING OF UNPRICED ( TECHNO

COMMERCIAL) BIDS

C&P & FINANCE AND A

REPRESENTATIVE FROM

INDENTOR

19

CUSTODY OF EMD/BID SECURITY

RECEIVED UPTO FINALIZATION OF

AWARD

FINANCE

20 CHECKING BANK GUARANTEES

FOR ITS ACCEPTABILITY FINANCE

21 EVALUATION OF BIDS PROJECT / INDENTOR / USER

DEPT., C&P, FINANCE

22 FORMATION OF TENDER

COMMITTEE C&P

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ISSUE OF TECHNICAL

QUERIES, COMMERCIAL QUERIES

TO BIDDERS AND

CORRESPONDENCE WITH

BIDDERS

C&P IN CONSULTATION WITH

INDENTOR & FINANCE

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CHECKING COMPLIANCE TO

TECHNICAL CRITERIA OF BEC &

PREPARATION OF TECHNICAL BID

PROJECT / INDENTOR / USER

DEPT


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ANALYSIS

25

CHECKING COMPLIANCE TO

FINANCIAL CRITERIA INCLUDING

PREPARATION OF COMMERCIAL BID

ANALYSIS

C&P IN CONSULTATION WITH

FINANCE

26 RECOMMENDATION FOR PRICE BID

OPENING TENDER COMMITTEE

27 PRICE BID OPENING

C&P & FINANCE AND A

REPRESENTATIVE FROM

INDENTOR

28 PRICE BID EVALUATION C&P IN ASSOCIATION WITH

FINANCE

29 PRICE NEGOTIATION, IF ANY,

AFTER APPROVAL TENDER COMMITTEE

30 FINALIZATION OF

RECOMMENDATION FOR AWARD TENDER COMMITTEE

31 CO ORDINATION FOR APPROVAL

BY COMPETENT AUTHORITY USER DEPT. / C&P

32

RESPONSE TO ANY QUERY BY

COMPETENT PURCHASE

AUTHORITY ON TC

RECOMMENDATION

TENDER COMMITTEE

33 LOI / LOA / AWARD OF CONTRACT /

PURCHASE ORDER

C&P HOWEVER TECHNICAL

SPECIFICATIONS SHALL BE

CONFIRMED BY USER DEPTT.

34 SIGNING OF CONTRACT C&P

35

DISTRIBUTION OF PURCHASE

ORDER / WORK ORDER TO ALL

CONCERNED

C&P

36

SCRUITNY & SAFE CUSTODY OF

PERFORMANCE BANK GUARANTEE /

SECURITY DEPOSIT

FINANCE / RECEIPT THROUGH

C&P


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37 RETURN OF EARNEST MONEY

DEPOSITS / BID SECURITY FINANCE, ON ADVICE FROM C&P

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EXPEDITING / MONITORING OF

ACCEPTANCE OF ORDER BY

VENDOR / CONTRACTOR AND

RECEIPT OF CONTRACT

PERFORMANCE BANK GUARANTEE /

SECURITY DEPOSIT

USER DEPT / C&P

39 RELEASE OF PERFORMANCE BANK

GUARANTEE / SECURITY DEPOSIT

BY FINANCE, ON ADVICE FROM

C&P/ USER AFTER DEFECT

LIABILITY PERIOD AND

SETTLING THE CLAIM IF ANY.

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POST AWARD MATTERS FOR

EXECUTION OF CONTRACTS

INCLUDING EXTRA, SUBSTITUTED

ITEMS, ETC.

PROJECT / INDENTOR /

ENGINEER IN CHARGE

41 PURCHASE ORDERS CLOSURE

C&P / PROJECT / USER /

FINANCE

42 CONTRACTS CLOSURE

C&P/ PROJECT / USER / FINANCE

ON RECOMMENDATION OF

ENGINEER IN CHARGE

4. INITIATION OF PROCUREMENT

i. The user / indenting department shall raise the requirement after careful analysis of

inventory, the necessity of such requirement for project, operation & maintenance

and establishment.

ii. The scope of work / supply, specifications & cost estimation shall be prepared by the

indenter.

iii. The indenter shall obtain the administrative approval and financial sanction for the

job.

4.1 PACKAGE DESIGN

The size and scope of individual package/contracts will depend on the size,

nature and location of the project. The objective should be to divide the Document downloaded on 09-04-2022 07:07:28 by

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requirements of the project into a manageable number of appropriate contract

packages which will produce the maximum competitive response from the

bidders. To be able to do this, one must not only understand the nature and value

of goods, works & services being grouped into contracts but one must also know

the conditions of the potential market of sources of supply of such materials,

works & services.

For breaking-down the total project work into smaller packages, the following

factors may be considered:

(a) The packages formed should be compatible considering the prospective bidders.

Thus, the contents of a package should be interrelated in such a way that

prospective bidders can tie-up with suppliers of the various equipments, works and

services involved in order to be able to bid for the entire package. This will ensure

adequate competition in bidding and consequent procurement at optimum cost.

(b) The packages formed should include such combinations of equipment, works and

services that can be advantageously engineered for the preparation of

specifications for bid documents and subsequent product designs including

manufacturing and construction drawings.

(c) The packages formed must be mutually exclusive as well as collectively exhaustive.

Thus, each package should be independent of all others, with regard to its contents.

(d) The number of packages and their sizes should be at an optimum level for effective

implementation.

(e) It should be possible to clearly define the responsibility for a package to individual

Engineering Coordinators to look after all technical aspects and Contracts

Coordinators to handle all commercial aspects of the packages.

(f) The terminal points of each package should be clearly defined and proper tie-ups

of these terminal points between packages ensured.

(g) In line with above guidelines, Consultants/Project Group shall outline packages for

execution of work/purchase for the projects at the time of deciding the execution

philosophy of a project, which shall be approved by the concerned Director for the

cases falling within the power of Director and above, before proceeding ahead with

tendering process for finalization of award.

4.2 SPECIFICATION

(a) The Purchase/Service/Material Requisition (PR/SR/MR)/Bid Document (Tender)

must indicate clear and detailed specifications, drawings, data sheets, any other


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specific and special requirements pertaining to the material to be procured and

any samples, wherever necessary, so that there is no ambiguity left for the

bidders to quote correctly. The Specifications should be drawn up in general

terms without quoting reference to any particular firm or taking it as model

specification as far as possible.

Specifications/Scope of Work prepared by the concerned User / Indenting

Department shall be approved, prior to invitation of tender/at the time of

administrative approval, by Competent Authority. Any modification in

specifications thereafter shall also be approved by Competent Authority. In case,

approving authority is Director & above, the approval of concerned Head of

Department (one level below Director) shall suffice.

(b) After issuance of tenders, changes in Specifications/Scope of Work given along

with the Bid Document / Purchase / Service / Material Requisition would normally

be avoided. However, if the revision of specification/scope of work is sought

subsequent to pre-bid conference or any other reason, approval shall be sought

from one level higher than the Competent Authority. Where Competent Authority

is Director and above, approval of concerned Director shall be obtained through

a Tender Committee. All such approvals relating to change in specifications and

scope shall be obtained by indenting department and forwarded to dealing C&P

Executive for further processing. Before incorporation of such revisions,

implications in prices and impact on time schedule for carrying out such changes

shall be clearly dealt with at the time of seeking such approval.

Once pre-bid conference is held in a case, specifications should be frozen and

after that no change in specifications will be permitted.

Once the bids have been received, no change in specifications/scope of work

/terms and conditions of the tender documents is permitted. Thus, seeking

revised bids on such accounts is not permitted.

(c) Before forwarding specifications for purchase, type of items required and the

requisite specifications must be firmed up. If required, study of the equipment for

drawing the specifications, by the group / department responsible to do so, may be

carried out well in advance. No team should be sent after the tenders have already

been invited for study of the equipment. Such study, if necessary, shall be

completed before raising Purchase / Service/ Material Requisition (PR/SR/MR) /

Bid Documents.


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(d) Proprietary materials or drawn up specifications that would result in proprietary

procurement should not be resorted to except in cases, where proprietary

procurement is unavoidable. Specifications should normally be drawn up in such a

manner so as to ensure competitive bids.

(e) It is advisable to make use of policy of buying ISI marked products like Fire

Extinguishers, Building Materials, PVC Pipes & fittings etc wherever possible to

have quality product, while framing specification of indented items/goods. In case

of other national /international standards like BIS etc. as applicable, shall be

indicated by Indentor for tendering.

4.3 TIME SCHEDULE / DELIVERY REQUIREMENT

A realistic and achievable Time schedule / Delivery requirement should be firmed

up while Purchase/ Service / Material Requisition (PR/SR/MR) / Bid Document

is prepared. The Bidding Documents must explicitly stipulate the Time Schedule

/ Delivery requirement. Only realistic time schedule / delivery requirements shall

be specified. It shall be the responsibility of the concerned Indentor/ Project

group / Consultant to specify time schedules / deliveries as are achievable based

on past experience with the domestic and global suppliers and on the basis of

data available in respect of other known sources of supplies and normal lead

time of procurement.

The realistic time schedule is essential to increase competition, obtain

competitive price and to avoid provisioning by bidders in their price to meet the

incidence of Price Reduction Schedule. Bidder not confirming the delivery

schedule mentioned in the tender document, then its bid may be liable for

rejection.

4.4 QUANTITY

(a) The requirement should be accurately assessed in the first place. To the extent

possible, over-provisioning should be avoided. Piecemeal demands and ad-hoc

purchases should also be avoided.

(b) Where materials are maintained in stock, the availability of material required,

type & specification should be ascertained and if substitution is possible, the

same should also be analyzed and Material Requisition should be raised only if

the above is not possible.


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5. COST ESTIMATE

The cost estimate is a very important factor in decision making process for

procurement. Therefore, the cost estimate should be made meticulously and real

time by indenter / user deptt./ to achieve the efficiency and economy in

procurement.

The cost estimation may include inter alia the following:

a. Established & Accepted Engineering practices, including DSR / CPWD/DGS&D

Rates etc.

b. Past procurement experience (e.g. last purchase price, including analysis of

WPI/CPI if any, etc.),

c. Costing Details/data available from other sources including CPSEs,

d. Market price trend analysis, and

e. Budgetary quotation (only for those items where detail information is not available

and estimation cannot be done as per Para (a) to (d) above).

Considering the importance of estimation in decision making for finalization of

award, cost estimates are required to be prepared by indenting/user deptt .

/consultant with utmost care and must be realistic to achieve economy &

efficiency in all procurement.

Preparation of estimates on the basis of budgetary quotation is to be adopted

only when the estimation cannot be done as per Para (a) to (d) above. Wherever,

cost estimate is prepared based on budgetary quotes, such budgetary quotes

should be obtained from the agency (ies) who prima-facia appear to be

competent to execute the proposed work. Further, such budgetary quotes should

be used for preparation of cost estimate only after due deliberations and these

deliberations should be made part of the proposal for administrative approval.

Further, whenever the scope of work (SOW) changes from original SOW (which

was considered for preparation of original estimate), a fresh/ additional approval for

revised cost estimate, if any, should invariably be obtained.

Purchase price in the preceding three years in the organization for the same item

(s) is to be considered by the indenter for preparation of estimate along with other

factors while seeking administrative approval. Further, the details/ documents

relating to past purchase prices and estimates are to be made part of proposal for

award.


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PREPARATION OF COST ESTIMATE

i) An estimated cost covering the Purchase/ Service /Work should be provided with

the Purchase/ Service / Material Requisition (PR/SR /MR) / Bid Document.

ii) To avoid wide variation between cost estimate and quoted value, a realistic cost

estimate of indented materials, works & services is essential. Therefore, utmost

care must be exercised while preparing the cost estimate.

iii) While preparing cost estimate, the complete scope of supply and services should

be kept in view as no subsequent revision in cost estimate during the processing

and finalization of award is desirable.

iv) In case of exceptional circumstances, where cost estimation is done based on

budgetary offer, obtained from the prospective bidders/OEM, it should be ensured

that the bidder(s) are provided with the complete specifications, scope of work,

operating conditions, special terms & conditions, General Conditions of Contract so

as to enable bidder(s) to submit realistic offer. The budgetary offer so received shall

be analysed so as to check its authenticity vis-à-vis market conditions before firming

it as a cost estimates.

v) Both the item wise and the total cost estimates are important for the purpose of

taking decision for placement of orders as also are of importance at various stages

of approvals during evaluation of Tenders.

REVIEW OF COST ESTIMATE

The variation between cost estimate and the lowest evaluated bid price calls for

review of the estimate. Such review needs to be done more exhaustively where the

lowest bid price is more than 10% higher the cost estimate. This analysis is required

to arrive at proper decision for placing order also keeping in view the other aspects

like project schedule etc.

Such review of cost estimate shall be done by indentor or PMC as the case may

be. The indentor shall obtain additional financial sanction for increased amount and

revise the PR/SR for further processing the case for award. In case of project

procurement, project group to confirm that increased amount is covered within

overall project cost.


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6. RAISING PURCHASE / SERVICE REQUISITION

The purchase requisition shall be raised by the indenter which should include the

following:

i. Scope & Specification for supply, services and works covered under the purchase

requisition.

ii. Estimated cost for the purchase shall be used for tendering and decision making

process.

iii. The time line when the services/ delivery of material and completion of work is

required.

iv. In case of requirement of Bid Evaluation Criteria the indenter will provide along with

PR the Technical part of BEC to be considered by Tender committee.

v. Budget provision and expenditure sanction.

vi. Schedule of rates with item description in case of item rate contract.

vii. Detailed Technical specification.

viii. If the invitation of Bid is to be done on limited Tender basis beyond the threshold limit

for the limited tender the PR should have the approval of Competent Authority for

Limited Tendering.

ix. In case of limited Tendering the indenter shall provide the list of the prospective

capable bidders.

x. In case of procurement on nomination basis, approval of Competent Authority for

resorting to nomination purchase with necessary justifications.

xi. In case of Propriety purchases, PAC should be provided confirming that no suitable

substitute exists.

xii. Special Condition of contracts (SCC)

xiii. Any other document required for tendering.

All Cases shall be processed on receipt of SAP generated PR/SR only. In case any

PR/SR is created where item wise estimate is not available at the time of creation of

PR/SR (in case of project procurement in exceptional circumstances), the item wise

estimates are required to be incorporated in the PR/SR by the indenter/Project before

generating comparative statement through system.

Only SAP generated Purchase orders/ Letter of Acceptances shall be issued to

suppliers / Vendors in all cases.

PR/SR in SAP is to be raised for the concurred/ approved amount only. In case of

any issue in raising PR/SR in SAP, BIS Group may be contacted for further action.


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SECTION-II

PRE AWARD CONTRACT MANAGEMENT

1. FORMATION OF TENDER COMMITTEE (TC)

No Tender Committee will be held for cases valuing upto Rs.5.00 Lakhs. All cases

valuing above Rs.5.00 Lakhs including finalization of Rate Contracts will be referred to

Tender Committee. TC is also required to be held for carrying out price negotiations (if

applicable) with bidders in all cases, irrespective of the value of the case.

However, TC is not required for placement of orders against PLL rate contracts. The

tender committee(s) will be formed of the three officers’ one level below the competent

purchase authority consisting of an officer each from C&P department, user / Indenting

department and finance department. However, in the event no officer of the requisite

level is posted, an officer of next lower available level in that section will be included in

the tender committee. The user department shall initiate and respective department

shall nominate the Tender committee member for approval by the Competent

Purchase Authority. In cases where the Competent Authority for placement of order

is Director and above, such approval shall be sought from the Director concerned.

In case a regular member of the tender committee is not available because of absence

either on leave or on outstation duty, the officer of next lower available level in that

section will be included in the tender committee, so as to obviate delays in holding

tender committee.

Where approval is required from Director and above, Tender Committee shall be held

at the level of the senior most officers available in the participating departments.

2. PREPARATION OF BID DOCUMENT

Generally a Bid Document shall comprise of the following;

i) Instructions to the Bidders (ITB).

ii) Bid Evaluation Criteria (BEC) comprising of Technical Qualifying Criteria and

Financial Qualifying Criteria.

iii) General Cond iti ons of Contr act (GC C) shall detail all the conditions of contract

applicable to the work.

iv) Scope of Work including Tech Specifications, Drawings etc.

v) Special Conditions of Contract (SCC) shall include specific to particular tender i.e.


24

Payment terms, delivery schedule / completion schedule, any deviation to the

general condition of the contract.

vi) Price Schedule / Schedule of Rates.

vii) Price Evaluation Methodology.

viii) Formats for Bid Bond / performance Bank guarantee and any other undertaking

required from the Bidder.

3. METHOD OF PROCUREMENT

Generally the following methods of procurement for goods, works and services are

considered:

i. Open Domestic Tender

ii. Limited Domestic Tender

iii. Open International Competitive Bidding (ICB)

iv. Limited International Competitive Bidding ( LICB)

v. Single Acceptable Bid

vi. OEM/ Propriety Procurement

vii. Procurement on nomination basis

viii. Petty Procurement of goods/works/ services through hand quotation

ix. Purchase by a Board of Officers

x. Emergency Purchase

xi. Annual Rate Contract / AMC

xii. Frame work Agreement.

xiii. Purchase from Governmental Co-Operative Commercial Outlets such as

Kendriya Bhandar or Similar Designated Co- Operative Bodies/State

Emporium

xiv. Quality and Cost Based Selection (QCBS) for Services

4. INVITATION OF BIDS / TYPES OF TENDER

4.1 OPEN DOMESTIC TENDERS

Wherever necessary particularly in the absence of enlistment of contractors

for a particular type of work, open-bidding with Bidder’s Qualification Criteria may

be resorted to by publication of Invitation of Bids in one English national daily

and one local newspaper wherever required.

While resorting to advertisement in newspapers, in view of significant cost


25

involved in advertisement, it is necessary that a brief advertisement appears in

the newspapers while drawing attention of the interested parties to detailed

Invitation for Bid appearing in the website of PLL.

When the value of materials/works/services covered in the tender is more than Rs.5

Crores for the projects (which are part of approved CAPEX budget) and Rs.2 crores for

all other cases such as O&M/ spares / routine works contract and for all services

contract, the open Tender shall be invited.

In case the open tender is not resorted to for any procurement even though the value

exceeds the amount specified above, and it is considered expeditious and appropriate/

adequate supplier/ contractor exists and are known, limited tender may be issued after

approval of Director concerned.

4.2 LIMITED DOMESTIC TENDERS

In cases where sources are reliable and proven for a particular requirement, a limited

tender may be invited in order to save the time and meet the project requirement.

When the value of materials/works/services covered in the tender is less than Rs.5

Crores for the projects (which are part of approved CAPEX budget) and Rs.2 crores

for all other cases such as O&M/ spares / routine works and all services, the limited

Tender may be invited.

In case of limited Tendering, Tenders shall be sent to all vendors indicated by User

Dept/ Indentor However, it should not be less than 6. In the event of number of vendors

/ bidders are less than 6, then approval of competent authority may be obtained as per

DoA with reasonable justification in writing. The names of the parties from whom the

Limited bids are proposed to be invited to be approved by competent authority.

No Tender Fee shall be applicable in case of limited Tender. Tender document shall

be issued free of cost.

4.2.1. VENDOR LIST FOR LIMITED TENDER

A vendor list may be prepared of qualified bidders for resorting to limited tendering

for procurement of goods, works and services. Indentor shall list out the items and

services for which vendors list is necessary based on in house information

especially based on previous procurement a vendor list for the given item may be

drawn. Such vendor list shall be approved by an officer not below the level of


26

General Manager of indenting department. Apart from above vendors, an additional

vendor list shall be sought after every two year from one of the promoter companies

or Engineer India Limited. While floating the tender on limited basis, bids may be

invited from all the vendors on the panel without any pick & choose. This list shall

be maintained by C&P department and should be updated after every 2 years by

the indenting department.

4.3 OPEN INTERNATIONAL COMPETITIVE BIDDING (ICB)

The procurement of materials / works / services where substantial import of Plant

and equipment /services are envisaged by indigenous manufacturers/ service

providers or enough competition does not exist in domestic market, the tender shall

be issued on open ICB basis. Further, the items which are not manufactured

indigenously shall be procured necessarily through ICB tender. In all such cases,

the enquiry shall be necessarily advertised through one English National Daily

newspaper and copies of Press notification (NIT) should also be displayed on PLL

website & sent to prospective vendors.

Copies of the ICB Press Notification shall be sent to the consulates / embassy of

the countries of prospective suppliers for circulation amongst likely suppliers in their

countries.

When the value of materials / works / services covered in the tender is more than Rs.5

Crores (which are part of approved CAPEX budget) for the projects and Rs. 2 Crores

for all other cases such as O&M/ spares / routine works and all services, open ICB will

be invited.

4.4 LIMITED INTERNATIONAL COMPETITIVE BIDDING (LICB)

Where value of equipment / material covered in enquiry is not more than Rs.5

Crores in case of Projects (which are part of approved CAPEX budget) and Rs. 2

Crores in all other cases O&M / spares / routine works and all services, tenders may

be issued on limited tender basis in the manner as prescribed in Clause 4.2 above.

4.5 SINGLE ACCEPTABLE BID

In response to limited / open tender if only one bid qualifies for acceptance, it shall

be termed as single acceptable bid received and in such case DoA (when only

single tender is received) shall be applicable.


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4.6 PROCUREMENT OF PROPRIETARY ITEMS / OEM / SERVICES

Procurement of proprietary items/services/should be made only if it is absolutely

essential. The approved list of all items above 5 Crore, which are intended to be

purchased as proprietary will be declared annually by respective Plant Heads and

PAC certificate for such items shall be approved by Concerned Director. However,

the placement of work order will be done as per the power mentioned in DoA.

For items below or equal to 5 Crore, declaration of intended item/services as

proprietary will be done by the Plant Head for plants and Concerned Director in

case of HO. For proprietary purchase, the indenter must provide the Proprietary

Article Certificate, as under, along with the PR/SR.

The indenter should justify the proprietary procurement on technical grounds and

submit PAC along with PR/SR as under:

(a) PROPRIETARY ARTICLE CERTIFICATE (PAC)

1) The equipment/ manuals/ services required are manufactured/ provided only by

M/s. ____________ No other make is acceptable as substitute for technical

reasons;

2) Approval of PAC. (copy to be provided);

3) No suitable substitute exists for the item for which the P.A.C. is given is available in

the Stores/in-house.

(b) Standby equipment, Accessories, sub-assemblies/assemblies and all such items

which are part of the original equipment supplied by OEM, however sourced from

their sub-vendor shall be considered OEM of those sub vendors, provided it is

approved by respective person per above clause confirming that no other

spares/substitute can be used as replacement. These items can be purchased on

OEM basis from the original supplier/ Stockist of original equipment/manufacturer

without PAC.

(c) Purchase of Indigenous items on proprietary basis

i. The indigenous purchase of proprietary items against the PAC should be made

from manufacturers or from dealer if nominated by the manufacturer on exclusive

basis (and not through a third party).


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ii. Spares for machineries, tools and equipment for which no substitutes are available

are to be treated as proprietary articles without PAC provided it is approved by the

General Manager confirming that no other spares/substitute can be used as

replacement. These are to be procured from manufacturers (OEMs) or from

dealer/firm if nominated by the OEM on exclusive basis (and not through a third

party).

(d) PURCHASE OF IMPORTED ITEMS ON PROPRIETARY BASIS

i. For purchase of imported items of proprietary nature from manufacturers/ supply

houses of the manufacturers in different countries, the procedure laid down vide

para (ii) will be followed.

ii. Purchase of spares shall normally be from original equipment manufacturers and

procurement from dealers/ distributors/ stockists should not be resorted to. Where,

however, the Original Equipment Manufacturers (OEMs) have, on their own or in

response to an enquiry, advised that the spares should be purchased from the

appointed dealer/ distributor/ stockist only, offers shall be invited through an enquiry

from all such designated agencies and the spares procured on most competitive

price basis. Such declaration from OEM should be taken on every instance of

purchase.

iii. In the event of nomination of dealer / distributor / stockist on exclusive basis, spares

will be procured from the same nominee.

(e) The steps to be followed while processing the indents of spares from OEMs

are given under:

1) The tender documents for procurement of equipment should necessarily have a

clause seeking commitment from OEM to supply spares directly and not to pass on

the responsibility to dealers / distributers / stockists or Indian associates.

2) If the contract between the foreign supplier and PLL during ‘Purchase of the Original

Equipment’ binds the supplier that the spares would be supplied by “Original

Equipment Manufacturer” only, then insist upon OEM to supply the spares directly

and not to propose supply through other Indian sources.

3)


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a) The spares must be procured directly from the OEM only and not from their dealers

/ distributors / stockist. In exceptional circumstances, if the OEM advises that the

spares should be purchased only from their authorized dealers / distributors /

stockist and they will not supply directly, then alone, bids can be considered from

authorized dealers / distributors / stockist instead of OEM. However, under no

circumstances, bids from Indian agents are to be considered.

b) In partial modification to the above, considering the changed scenario where OEMs

have made joint Ventures with the Indian Companies and have in some cases

opened their own subsidiaries, offers from the OEM specified Joint Ventures/

Subsidiaries can also be considered for procurement of the spares.

c) Thus, if OEM does not agree to point no. 2 above or point no. 2 is not applicable

then OEM may be asked to supply the spares on “High Sea Sales” basis through

their authorized dealers/ distributors / stockists / joint ventures /subsidiaries instead

of OEM. However, under no circumstances, bid from Indian Agents would be

considered.

4) In case procurement through above condition fails then procurement on “other than

High Sea Sales” basis may be made from authorized Indian dealers / distributors /

stockists / joint ventures / subsidiaries of OEM with the approval of concerned OIC

subject to the fulfilment of the following five conditions, which shall form a part of

the tender conditions:

i. The Vendor should provide the proper excisable invoice/proper duty paying

documents in order to enable PLL to avail input tax credit of GST

a) In case of imported spares / stores which are sold as such i.e. without any further

Processing in India:

Vendor should be registered with CBIC (Central Board of Indirect taxes and

Customs)/ any equivalent government in India and should provide invoice in the

name of PLL, specifying the Input tax credit amount details of IGST etc. along with

statutory information as specified under Central/ State GST law/act.

b) In case of spares which are assembled (manufactured) in India (using imported

components also):


30

Vendor shall provide invoice in the name of PLL, specifying the CGST plus

SGST/UTGST or IGST, if applicable, along with other statutory information as

specified under Central/ State GST law/act.

ii. The vendor would issue a certificate on its letter head, certifying that in respect of

supplies of goods to PLL under specified PO, the vendor has paid proper duties of

customs on inputs/components/spares being supplied to PLL.

iii. Necessary fall clause should be incorporated.

iv. The price quoted by the bidder may be compared with those at which the bidder

has supplied the same term/services to the other company(ies) in India. For the

purpose, the bidder should be asked to provide the copies of the orders

executed/currently in hand.

v. If the transaction is done other than on high sea sake basis, negotiations, with due

approvals and as per the guidelines in vogue, should be undertaken with the

supplier to pass on appropriate benefit to PLL on account of CST/VAT, that would

have been available to PLL, had the transaction been done on “High sea Sales”

basis.

5) If the Vendor does not agree to fulfil the above conditions mentioned at 4(i) to 4(v)

above, then a clause may be incorporated in tender/ PO that PLL shall be free to

report the transaction to appropriate custom authorities/ Department of Revenue

Intelligence/ Enforcement Directorate and in such case Head of Department shall

be empowered to approve a proposal up to Rs. 5 lacs/case only. For proposals of

Rs 5 lacs & above, approval of concerned Director shall be required taking deviation

to any of the points listed at 4(i) to 4(v) above.

4.7 PROCUREMENT ON NOMINATION BASIS

The award on nomination basis should be avoided however, considering the

operational / organizational need, orders may be placed on nomination basis with

proper reasons / justification in writing and establishing the cost responsibility.

All efforts should be made for timely processing of procurement cases so as to meet

the operation requirements and avoid last minute urgency leading to procurement

on nomination basis.

The following guidelines shall be used for processing the cases on nomination


31

basis:

i. Award of Contracts for Materials/Works/Services/Consultancy.

a) Any award made without resorting to competitive bidding, except for procurement

of goods and services from OEM and/or against PAC, shall be considered as award

on nomination basis

b) Placement of order(s) on nomination basis, sought to be justified on the plea of

emergent situation, apparently on account of delay in timely action for floating of

tenders, should be avoided and tendering procedure should be followed to invite

competitive bidding basis as per procedure so as to give fair and equal opportunity

to all, Therefore, award of contract on nomination basis should be resorted to only

in exceptional cases and powers to award contracts on nomination basis should be

exercised judiciously with proper & valid justification, which should be recorded in

writing.

ii. PROCEDURE FOR AWARD OF CONTRACTS/PLACEMENT OF ORDERS FOR

MATERIALS/WORKS/ SERVICES/ CONSULTANCY ON NOMINATION BASIS

1.0 General

1.1 While it is to clearly understood that normal mode of award of contracts is tendering,

this procedure shall be applicable for activities undertaken without resorting to the

normal mode. It is made explicit that this procedure is made only to tide over

contingent requirements meeting exacting quality standards perspective and if not

proceeded with are timely to jeopardize normal operation and business interest,

Any such proposal shall therefore be complete in all respects for the necessity of

adopted method of award as well as fully substantiated / justified for the selected

vendor / contractor / consultant / service provider and duly supported by

reasonableness of rates/ prices .

1.2 The proposal for procurement on nomination basis shall be prepared by the

concerned department for financial concurrence (if required) and approval for

proceeding on nomination basis of an authority defined in 2.0 below.

2.0 APPROVAL OF PROPOSAL

2.1 The concerned department shall put up a Complete Proposal for approval by the

Competent Authority (CA) not below the rank of Chief Manager. The proposal inter-

alia shall include:


32

i. Justification of the proposed methodology for award. If the justification provided is

solely for the reason of time criticality, then it must be explained as to why the action

could not have been taken sufficiently in advance and placement of order achieved

as per normal tendering process.

ii. Reasons for selection of single nominated Vendor / Contractor / Consultant /

Service provider. The proposal should also give details of past experiences and

references including other credentials about the capability of such an agency for

procurement of materials / works / services / consultancy.

iii. Price reasonableness of the proposed award including the basis of estimation of

cost. If the cost estimate is based only on budgetary quotation received from the

proposed bidder, then an analysis shall be made by the concerned department of

the adequacy of the same.

iv. A detailed scope of work, specifications and deliverables. Time Schedule of such

activities and payment mechanism as is anticipated for the same.

v. Any other documents, details and data in support of the proposal

Checklist for preparation of proposal for administrative approval:

- Reasons for award on nomination basis

- Reasons for selecting particular vendor / contractor / consultant / service provider.

- Cost estimate with proper analysis and justification

- Proposal in complete proposal format.

2.2 The proposal as indicated above shall be put up to the Competent Authority not

below the rank of Chief Manager through the Head Of Department, where the

Competent Authority for the approval (as per DoA) is below the level of Head Of

Department, the proposal for award on nomination basis must be put up for

approval of concerned Head Of Department.

4.7.1. EXTENSION OF CONTRACT ORIGINALLY AWARDED ON NOMINATION

BASIS:

The extension of contract as far as possible should be avoided. All efforts shall be

made to award a new contract before expiry of the existing contract.

However, in case of service contract if new contract is not finalized for any reason

the existing contract may be extended for a period as per the provision of the

original contract and DoA. The competent authority to approve the extension of


33

the contract shall be based on total contract price (the value of original contract +

value of extension) as per DoA.

4.8 PETTY PURCHASES / WORKS / SERVICES

Petty Purchases / Works / Services upto Rs.50, 000.00 at a time can be made without

formal enquiries or, without obtaining hand quotations by taking contingent advance

as per DoA. PR / PO is not required to be made in SAP.

4.9 PURCHASES / WORKS / SERVICES THROUGH BOARD OF OFFICERS

Purchases / Works / Services by Board of Officers will be resorted to in special

circumstances when the materials / works / services are either required urgently to

overcome the exigency or, because the indenter is not able to give firmed up /

detailed specification (necessitating on the spot decision based on the availability in

the market).

Prior sanction of the Competent Authority should be taken for purchase through

Board of Officer.

In case of respective plants, Plant Head is empowered to constitute a Board of

Officers. Board of Officers would comprise of head of indenter, head of finance and

head of C&P. If for any reason it is not possible to constitute a Board of Officers as

mentioned above, the board may be constituted with an officer of the next lower level.

In case of Head Office, respective Sectional Heads are empowered to constitute a

Board of Officers. The Board of Officers would comprise of an officer each from

indenting section, finance section and C&P.

For carrying out Purchases / Works / Services, the Board of Officers shall explore the

local market as first priority before seeking offers from outside the city/town. Further,

the Board of Officers shall obtain as many sealed quotations as possible so as to

determine the reasonability of rates.

The Board of Officers will, in case it is unavoidable, be authorized to make purchases

from the market on cash basis (as per DoA) after market survey and obtaining as

many hand quotations as possible. The cash advance shall be drawn by the F&A

member of the Committee.

The proceedings of the Board of Officers should be ratified by the authority that

constituted the Board of Officers.


34

In case where Board Purchase has been resorted for procurement of services to

mitigate the urgency, in such a case the period of contract shall be limited to a

maximum of 06 (six) months only except for cafeteria services. However, in

exceptional cases, if a Work Centre requires extension due to certain reasons,

approval for such extension of awarded contract is to be obtained from the concerned

Director. Further, the procurement of services through normal tendering should be

expedited and all out efforts are to be made to finalize the tender before the expiry of

contract awarded through Board Purchase.

No EMD / Bid bond is required for board purchase.

4.10 EMERGENCY PURCHASE OF MATERIALS, WORKS AND SERVICES:

Emergency refers to cases of natural calamity, burst in pipelines, explosion, fire,

operational emergency which may result in safety hazard if not attended or repaired,

requirement necessitated by plant shut down, break-down of system, flood,

earthquake thereby endangering pipelines, plant, property and lives. Care should be

taken for not mistaking urgent requirements with emergent requirements. For

example, expenditure on laying / construction of road for an impending visit of a

dignitary can only be classified as urgency and not emergency.

Financial sanction / concurrence will not be necessary in the case of emergency. In

case of operational emergencies involving breakdown in operations, the user

department may resort to direct purchases as per powers delegated in the Delegation

of Authority. The limit of placement of order for Purchases / Works / Services during

emergency shall be as per DoA.

In case of emergency purchase normal process of procurement as per procedure

may not apply, however normal prudence and transparency to be maintained. Proper

record to be maintained by user department about consumption of material

purchased for reconciliation.

4.11 PROCUREMENT OF MATERIALS, WORKS AND SERVICES THROUGH

RATE CONTRACTS / ANNUAL MAINTENANCE CONTRACTS

4.11.1. For Materials, Works and Services required continuously throughout the year in large

quantities and of common and frequent use, it may be advantageous to have a rate

contract (ARC/AMC). The Rate Contract may be finalized through competitive

bidding for a period of 2 (two) years without provision for price variation,


35

.

The rate contracts should not be extended beyond original specified period. If it is

essentially required, the original contract period may be extended maximum for a

period of 1 (one) year with approval of competent authority in line with DoA and

reasons to be recorded in writing. The tender document should have a provision that

the contract may be extended for additionally one year on same terms and condition

and price.

Timely action should be taken to enter into fresh contract before the expiry of original

contract.

Long term contracts with OEM for repair and maintenance services (including supply

of spares for maintaining optimal inventory level) of equipments having long

operational life (e.g. Gas Turbines, Pumps, etc.) can be entered into for a period of

five years or more where terms and conditions, applicable discount on listed spare

price can be firmed up centrally. These long term contracts can be used by all

concerned units for repair and maintenance of respective equipments pertaining to

their unit.

4.11.2. PROCUREMENT OF MATERIAL ON HIGH SEA SALES BASIS

As a matter of principle the import of goods / equipment and spare parts for operation

and maintenance for the installation should be procured directly from original

equipment manufacturer (OEM) and not from their dealers / distributers / stockiest.

In exceptional circumstances, if the OEM advises the spares should be purchased

only from their authorized dealers / distributers / stockiest and OEM is not willing to

supply directly, then alone, bids can be considered from their authorized dealers /

distributers / stockiest instead of OEM.

In the above situation when the goods / spares are purchased from authorized

dealers / distributers / stockiest of OEM the process of High Sea Sales shall be

applicable. In case of High Sea Sales following shall be applicable:

1. The Order shall be placed on the local authorized dealers / distributers / stockiest of

OEM.

2. The local authorized dealers / distributers / stockiest of OEM shall place order on its

overseas principal.

3. There shall be a High Sea Sales agreement between local authorized dealers /


36

distributers / stockiest of OEM and Buyer (Petronet LNG Limited)/overseas supplier.

4. In High Sea Sales the ownership gets transferred to the buyer in the high sea.

5. The seller shall endorse the shipping documents in favor of Petronet LNG Limited.

6. The applicable custom duty shall be paid by Petronet LNG Limited.

4.12 FRAME WORK ARRANGEMENT

The items and services which are regularly required and are prone to sharp price

variation, a frame work arrangement may be made after freezing all technical and

commercial requirements. The frame work arrangement shall be made through

advertisement. The frame work arrangement shall not have price and as and when

the requirement of material or services arises, all the agency with whom the frame

work arrangement has been finalized shall be asked to submit the price only on a

short notice. This shall save the time and PLL shall be able to place order on real

time price.

The validity of frame work arrangement may be for 2 years.

4.13 PURCHASE FROM GOVERNMENTAL CO-OPERATIVE COMMERCIAL

OUTLETS SUCH AS KENDRIYA BHANDAR OR SIMILAR DESIGNATED

CO- OPERATIVE BODIES/STATE EMPORIUM

Purchases from the Governmental co-operative commercial outlets such as Kendriya

Bhandar or similar designated co-operative bodies/ State Emporium/Government

Departments/Central and State PSUs may be effected wherever possible, without

following normal tendering procedure as per Govt. guidelines in vogue. However, a

formal approval shall be taken as per power delegated for placement of order without

calling for tender. Such procurement shall not be treated as procurement on

nomination basis.

4.14 EXPRESSION OF INTEREST (EOI)

This method shall be used when the indenting group is not reasonably sure on the

specifications / scope of work / source of supply and would like to take the help of

prospective bidders in finalizing the same. Approval of the concerned Director would

be required for resorting to EOI route. EOI is not a tender and shall be used by User

group to explore market conditions as follows;


37

I. Enquiry for seeking ‘Expression of Interest’ from bidders should be published in at

least one national daily and the PLL web site. The web site address should also be

given in the advertisements. Enquiry for seeking Expression of Interest should

include in brief, the broad scope of work or service, inputs to be provided by PLL,

eligibility and the pre-qualification criteria to be met by the bidder and bidder’s past

experience in similar work or service.

II. The bidders may be asked to send their comments on the objectives and scope of

the work or service projected in the enquiry. Adequate time should be allowed for

getting responses from interested bidders.

III. Instructions regarding nature of job; submission requirement; last date of submission;

place of submission; and any related instruction shall be included.

IV. Proper format in which the bidders are expected to submit their EOI shall be prepared

and enclosed.

Once based on the information available from the perspective agencies the scope

and specification of the job is frozen, a normal Tender may be issued for processing

an award in case it is decided to continue with requirement.

4.15 QUALITY AND COST BASED SELECTION (QCBS) FOR SERVICES

Keeping in view the requirement of engaging the most experienced agencies to

execute the assignment in an efficient and effective manner and to avoid sub-

standard services for assignments of critical and specialized nature, a list of such

services has been identified as under where QCBS is to be followed:-

Creative Advertising Agencies

Architectural Firms

Attorneys

Trainers / Faculty

Management consultants

Facility Management

Specialized Consulting Services

Event Management Agencies

Specialized security services with integrated hardware.

The process to be followed for tendering in QCBS based selection shall be same

as per Procedure for Selection of Consultants and its amendments/ addendums

thereof.


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5. BIDDING SYSTEM - SINGLE BID AND TWO BID SYSTEM

5.1. SINGLE BID / SINGLE ENVELOPE SYSTEM

This system of bidding essentially means that technical and prices are obtained

in a single envelope and opened for processing. This system should be followed

only if the specifications and terms & conditions / quantities tendered for are

absolutely firm and bidders strictly comply with all requirements set out in the

tender documents.

Subject to above the procurement for goods/ services and works may be done

through single envelope system for value upto Rs.5.00 Lakh. The envelope

containing both techno-commercial part and price part should be opened on the

bid opening time and date after verification of bid security and conformation for

compliance to the terms and conditions of tender without deviation. The EMD and

above confirmation to terms and conditions to be provided along with the Bid.

5.1.1. Procurement of OEM / Proprietary / Spare part award of contract on nomination

basis may also be through Single Bid system. The value of such procurement

may be more than Rs. 5.00 lakh as per the requirement.

5.1.2. Procurement of normal items, other than OEM / Proprietary / Spare parts may

also be done on single envelope basis for value more than Rs. 5.00 Lakh, with

approval of Competent Purchasing Authority.

5.1.3. All Tender which are under single Bid system should be finalized within 30days

from opening of the Bid.

The activity wise schedule is given as under:

Sr. No. Activity

Maximum

Period

allowed

1. Opening of Un-priced bids 0

2. Scrutiny of bids and issuance of TQ/CQ (if any) 7 days

3. Vendor response to TQ/CQ (if any) 7 days

4. Evaluation of response to TQ/CQ and finalization of 6 days


39

TBA/CBA/CS

5. Vetting of CBA and CS by F&A department 3 days

6. Finalization of TCR for award 5 days

7. Approval of CA and award 2 days

Total Period allowed (max.) 30 days

5.2. TWO BID / TWO ENVELOPES SYSTEM

Two Bid system is generally used in following situations:

i. In case of procurement of capital items / works / services of complex and

sophisticated nature where it is essential to examine the technical offer for

acceptability and compliance to the tender condition.

ii. In procurement of items where service conditions and other parameters are

provided by PLL and equipment are designed and manufactured by Bidder which

may require examination of the Bid for compliance to the tender condition.

iii. Service / works contract where it is necessary to raise technical and commercial

query to the Bidder for examination of the Bid.

Under Two Bid System the bidders will be asked to submit 'Techno-commercial Bid’

(PART-I) containing Technical and Commercial proposals but without prices and

'Price Bid’ (PART-II) containing only prices quoted in requisite formats separately

in sealed covers duly super scribed and both the offers placed in one single sealed

cover. The required Earnest Money Deposit (EMD) / Bid Bond to be submitted

separately in the main envelop.

Before opening of the Bid it shall be verified that whether the Bidder has submitted

the EMD and Tender Fee. The techno-commercial bids will be opened first and

scrutinized by Tender Committee. After the short listing of techno-commercially

acceptable bidders all such bidders will be notified of the date, time and venue of

opening priced bids. The priced bids will be opened by Tender Committee.

In case of the E-tendering, the EMD to be submitted in separate envelop.


40

The Activity wise schedule for finalization of tenders under two bid system is

provided below:

Sr. No. Activity Maximum

Period

allowed


2. Scrutiny of bids and issuance of TQ/CQ (if

any)

10 days


4. Evaluation of response to TQ/CQ and

finalization of TBA/CBA

6 days

5. Vetting of CBA by F&A department 3 days

6. Finalization of TCR for Price Bid Opening 4 days

7. Approval of CA and Price bid opening 3 days

8. Preparation of CS 2 days

9. Vetting of CS by F&A department 2 days



11.(A) Approval of award 5 days

Total Period Allowed (max.) 45 days

The Activity wise schedule for finalization of tenders under two bid system for

complex or turnkey package / tender where PMC is involved is provided below:

Sr. Activity Maximum

Period


41

No. allowed


2. Scrutiny of bids and issuance of TQ/CQ (if any) 15 days


4. Evaluation of response to TQ/CQ and finalization of

TBA/CBA

6 days

5. Vetting of CBA by F&A department 3 days

6. Finalization of TCR for Price Bid Opening 5 days

7. Approval of CA and Price bid opening 2 days

8. Preparation of CS 7 days

9. Vetting of CS by F&A department 3 days



11.(A) Approval of award by EPC 5 days

Total Period Allowed (max.) 60 days

6. BID EVALUATION CRITERIA

Before invitation of tenders, a suitable technical as well as commercial bid

evaluation criterion is to be formulated and recommended by the tender committee

for approval of the competent authority. However, where the Competent

Authority for placement of order is MD & CEO and above, such approval shall be

sought from MD & CEO.

The bid evaluation criteria so finalized will be incorporated in the tender documents.

The purpose of such criteria is to establish the capability of the prospective bidders in

being able to execute the order strictly in accordance with the various technical

and commercial stipulations of the contract.


42

The Eligibility or capability is assessed generally in relation to the technical competence

based on the similar past experience. The financial soundness is ascertained through

scrutiny of financial documents such as balance sheet with reference to turnover, net

worth and other financial parameters.

While factors related to experience in manufacturing/ fabrication capability are more

relevant and important for orders pertaining to supplies; Experience and financial

soundness assume relatively high relevance and importance while assessing the

capability of contractors for construction work / turnkey jobs and services provided by

them.

The bid evaluation criteria and other relevant tender conditions should be made

in such a manner that the competent bidders participate in the tender and there is

sufficient competition. The BEC should never be framed keeping in view a particular

bidder (s). As far as possible, the BEC should be meeting the job requirement and

ensuring adequate competition.

As a general guideline, following may be considered for eligibility assessment.

6.1. FINANCIAL CRITERIA

Financial Criteria mentioned below is to ascertain financial soundness of the bidders

and to be included in open tender only. Considering nature of item/job, some of below

mentioned financial criteria can also be included in limited tender after

recommendation of tender committee with proper justification.

In case of tender upto Rs. 1 Crores for procurement case and Rs 50 Lakhs for works /

services, above financial criteria shall not be applicable:

Sl No. Financial

criteria

1 Annual

Turnover

Value (i) 50% of the annualized estimated value for all

cases where execution / delivery period is more

than one year.*

(ii) 50% of the estimated value for all cases where

execution / delivery period is less than one


43

year. **

For

consortium

Leader to achieve 50% requirement and

partner minimum 25%

Period In any one of preceding 3 audited financial year

2 Net worth Positive for preceding audited financial year.

3 Working

Capital

10% of annualized estimated value in the

absence of which a line of credit from Bank.

*For example: The estimated cost of any service/ item is INR 60 Cr. , and delivery /

execution period is 3 years , then the annualized value come to INR 20 Cr. In such

case the threshold annual turnover required would be INR 10 Cr.

**For example: The estimated value of any work is INR 15 cr , and time delivery date/

execution period is 6 months , In such case threshold annual turnover required would

be INR 7.5 Cr.

6 . 2 . TECHNICAL CRITERIA

Depending upon the nature of item/ job, broad guidelines for technical criteria shall be

as under:

6.2.1. PURCHASE:

i. Experience of manufacturing and supply of similar equipment/ material / plant in

previous 5 years.

ii. Availability of manufacturing / fabrication facility with adequate testing/ quality

assurance facility as per applicable code

iii. The bidder should have experience of successfully executing one similar order for 50%

of estimated value in preceding 5 years.

In case of rate contract for supply of bulk materials / off the shelf equipment/

consumables items, the bidder should have executed at least 50% of the annualized

quantity of the estimate under the tender in one year in preceding 5 years.

If the experience can be specified in terms of technical parameters, the criterion of

similar work experience may not be necessary to be specified in terms of value.

6.2.2. WORKS (INCLUDING EPC) / SERVICES:

i. Experience of at least one similar work of about 50% of value of work in previous 7


44

years. However in case of Rate / Maintenance Contract, experience of at least one

similar work of about 50% of annualized value of work under tender in previous 7 years

is to be considered.

ii. “Similar works” if specified in BEC must be clearly defined in the tender document.

Further at times, the criterion of similar works experience may not be necessary to be

specified in terms of value, if the experience can be specified on technical parameters.

However, in case of annual contracts (Service and Maintenance), where contract

period is more than one year, 50% single order value is to be considered on annualized

value of work.

In case of tenders for annual rate contracts / maintenance and service contracts, if the

prospective bidder is executing rate / maintenance / service contract which is still

running and the contract value / quantity executed prior to due date of bid submission

is equal to or more than the minimum prescribed value in the BEC such experience

will also be taken in to consideration provided that the bidder has submitted satisfactory

work / supply / service execution certificate issued by the end user.

The above regarding the BEC are the general guidelines to be considered while

formulating bid evaluation criteria. The indenting department concerned with due

reasoning may suitably formulate the BEC depending upon the job requirements and

the same shall not be treated as deviation to the procedure. While making BEC, the

prime objective is that only capable bidder should qualify as it works like filter. At the

same time, there should be sufficient competition.

Once the tender is floated, no amendment / modifications of approved BEC shall be

permitted.

A job executed by a Bidder for its own plant/projects cannot be considered as

experience for the purpose of meeting requirement of BEC of the tender. However,

jobs executed for Subsidiary/ Fellow subsidiary/ Holding company will be considered

as experience for the purpose of meeting BEC subject to submission of tax paid

invoice(s) duly certified by statutory Auditor of the Bidder towards payments of statutory

tax in support of the job executed for Subsidiary/ fellow subsidiary / Holding company.

Such Bidders to submit these documents in addition to the documents specified in the

bidding documents to meet BEC.


45

The bidders must submit the completion certificate issued by end user / owner (or their

consultant who has been duly authorized by them to issue such certificate) only after

completion of work / supply in all aspect. However, in case of tenders for annual rate

contracts/ maintenance contracts, where the bidder is executing a rate / maintenance

contract which is still running and the contract value /quantity executed till one day prior

to due date of bid submission is equal to or more than the minimum prescribed value /

quantity mentioned in the BEC, such experience will also be taken into consideration

provided that the bidder has submitted satisfactory work / supply execution certificate

issued by the end user / owner / authorized consultant. The provision of consideration

of experience of a bidder for a running rate/ maintenance contract as mentioned above

is to be included only in case of tenders for Annual Rate Contract (ARC) / Annual

Maintenance Contract (AMC) for supplies/ services/ consultancy/works.

6.2.3. PROVISION OF CONSORTIUM BID IN TENDER

The bids are normally invited from single source/agency having requisite experience

and resources to execute the job.

However, if the quantum of job is very large, the job requires multi-specialties and a

single agency is not likely to have capacity to execute the work on its own with its

experience and resources/ specialization, requires pooling of the resources of various

agencies. In order to facilitate this, the provision of consortium bid is provided in the

tender document so that more than one agency join hands to pool their experience

resources and expertise and submit a consortium bid, wherein there will be a leader

and other members(s).

As regards, Qualifying Criteria, there will be predefined technical and commercial

Qualifying Criteria in the BEC for leader as well as members of the consortium which

they should necessarily meet. In case any member of the Consortium does not meet

the qualifying criteria required for job distribution amongst them, the bid shall be liable

for rejection.

The Provision of Consortium bid should not be used in routine manner. Therefore,

provision of the consortium bid in the tender is to be analyzed based on above lines

before putting the same in the Tender conditions. Before preparing tender document

and its conditions including BEC, a separate approval for keeping provision of

Consortium Bid in a tender shall be obtained from the Competent Authority/ Director


46

concerned for cases falling in the power of Board.

6.2.4. AUTHENTICATION OF DOCUMENT SUBMITTED IN SUPPORT OF BID

EVALUATION CRITERIA (BEC)

I. For authentication of document submitted in support of financial Criteria of Bid

Evaluation Criteria (BEC):

a) Indian bidder: shall submit “Details of financial capability of bidder” in prescribed

format duly signed and stamped by a chartered accountant.

Further copy of audited annual financial statements submitted in bid shall be duly

certified/attested by notary public with legible stamp.

b) Foreign bidder: shall submit “Details of financial capability of bidder” in prescribed

format duly signed and stamped by a chartered accountant.

Further, copy of audited annual financial statements submitted in bid shall be

certified true copies, duly signed, dated and stamped by an official, authorized for

this purpose in Indian Embassy/ High Commission in bidder’s country. However,

member countries of Hague Convention 1961, supporting document pertaining to

financial BEC apostille affixed by Competent Authorities designated by the

government of bidder’s country shall also be acceptable.

Above provision should be included in tender/ RFQ documents having estimated

value of more than Rs. 1 Crores for procurement and Rs. 50.00 Lakhs for

works/services

II. All documents in support of Technical Criteria of Bid Evaluation Criteria (BEC) to

be furnished by the bidders shall necessarily be:

(A) For tenders valuing Rs. 50 Crores and above for Projects and Rs. 10 Crores and

above for O&M (both excluding taxes and duties) All documents in support of

Technical Criteria of Bid Evaluation Criteria (BEC) furnished by the bidders shall

be verified and certified by any one of the following independent third party

inspection agency:

(i) Société Générale de Surveillance (SGS)

(ii) Gulf Lloyds Industrial Services (India) Pvt. Ltd. (GLIS)

(iii) International Certification Services (ICS)

(iv) Bureau Veritas (Ind.) Pvt. Ltd (BVIS)


47

(v) TUV SUD (TUV).

(vi) Det Norske Veritas (DNV)

(vii) Certification Engineers International Ltd. (CEIL)

(viii) Lloyds Register Industrial Services (LRIS)

All charges of the Third party for verification and certification shall be borne by the

Bidder.

(B) For tenders valuing less than Rs. 50 Crores for Projects and less than 10 Crores for

O&M (both excluding taxes and duties)

a) For Indian bidder: duly certified/ attested by Chartered Engineer and notary public

with legible stamp.

b) For Foreign bidder: duly certified/ attested by Chartered Engineer/ Licensed

Professional Engineer or Equivalent Registered Engineer of bidder’s country with

legible stamp.

Further, supporting document pertaining to technical BEC should also be certified

true copies, duly signed, dated and stamped by an official, authorized for this

purpose in Indian Embassy/ High Commission in bidder’s country. However,

member countries of Hague Convention 1961, supporting document pertaining to

technical BEC Apostille affixed by Competent Authorities designated by the

government of bidder’s country shall also be acceptable.

Above provision should be included in tender/ RFQ documents having estimated

value of more than Rs. 1 Crores for procurement and Rs. 50.00 Lakhs for

works/services

7. ISSUE / SALE OF BID DOCUMENTS

Tender documents will be sold on receipt of application along with requisite tender fee.

No tender documents will, however, be sold / issued to the bidders who are on Holiday

by PLL ( if any) or have initiated any court proceedings , arbitration or started any

litigation process against PLL. If the documents were issued inadvertently /

downloaded from website, offers submitted by such bidder shall not be considered if

the bidder is on holiday as stated above on the due date of Bid submission, Offer from

such bidder shall be returned. The above is with prejudice to other rights of PLL.


48

However, the Bid Documents shall be issued free of cost in case of limited

tender / nomination basis and e-tendering. The Bid Documents are not

transferable and the bids shall be accepted only from the bidder in whose name

the tender document has been issued.

7.1. PROCEDURE FOR ISSUE OF LIMITED/ OPEN TENDERS:

1. C&P Department will maintain an enquiry Register. A separate page for each enquiry

will be allotted in that register.

2. In case of limited enquiries, the name of the firms to whom the enquiries is issued will

be entertained in that register.

3. In case of Open Tendering the names of the parties who have bought the Bid

Documents shall be entered along with, their addresses contact person name and

contact details, the cost paid by them and mode of payment and remarks if any. The

above is not required in case of E-tendering.

4. Enquiry may be issued to all the empaneled vendors/contractors without pick and

choose.

5. Tender to have provision that on enquiry from bidder the reason for rejection of their bid

is to be intimated to them. Our tender should have following clause in ITB RFQ.

"Bidders if so desire, may seek in writing the reasons for rejection of their bid, to which

PLL respond quickly."

6. The Tender document should be ready for sale in all respect once the Notice

Inviting have been issued for Open Tender.

7. The intimation for forth coming tenders should be given to all prospective bidders so

that apart from NIT they are aware of upcoming tender.

8. In case of Open Tender, sale of Bid document shall continue up to one day prior to the

Bid submission date.

7.2. NOTICE INVITING TENDER (NIT)

Open tender may be invited by publication of Invitation of Bids in two or more

newspapers of all India repute or local repute depending upon the value and

importance of the work.

While resorting to advertisement in newsp apers, it is necessary that a brief

description of NIT appears in the newspapers, drawing attention of prospective

bidders to visit PLL website (www.petronetlng.com) for the Bid Eligibility Criteria,

Tender fees, bidding schedule etc.


49

Cost of Bid Document in case of open tendering shall be fixed as under:

S.N. Estimated Value of Tender

(in INR)

Domestic

(in INR)

International

(in USD or,

equivalent

approximate INR)

1 Upto 10 Lakhs Nil Nil

2 From 10 Lakhs Upto 5 crore 2,500.00 100.00

3 From 5 crore upto 10 crore 5,000.00 200.00

4 More than 10 crore 25,000.00 1000.00

Note:

1. In case of limited bids, the tender documents shall be issued free of cost. The

tender document may be sent in PDF format to the company e-mail address.

2. In case of high value Tenders where Technical drawing / specifications run into

several pages the cost may be fixed by Tender committee duly approved by

competent authority ( In case where CPA is Director and above approval from

concerned Director shall suffice) keeping in view the expenditure occurred thereon

and the labor involved.

3. Foreign Bidders can purchase Tender document by submitting tender fee in USD

or equivalent INR (directly through their authorized Indian representative)

However, Offers made by Agents / Consultants / retainers / of foreign principals

will be rejected.

4. Tender Fee shall not be required in case of E-tendering.

8. NUMBER OF COPIES OF OFFERS

No. of Copies of bids will be sought as under:

Sr.

no.

Description Unpriced Priced

i Where in house evaluation is involved Original plus one Original

ii Where tender evaluation is done by

consultant

Original plus two Original


50

9. REASONABLE TIME FOR BID SUBMISSION:

The bidder should be given reasonable time period for studying the tender document

and preparation of bid. Accordingly depending on the nature of the works like supply

indigenous / imported, ICB tenders / LSTK contracts different time slabs should be

given for the submission of the bid.

The following time period shall be allowed to the Bidders to submit bid:

(i) For ICB/ Import Tenders : 30-45 Days

(ii) Turnkey Projects/ EPC Contracts : 45-60 Days

(iii) For Indigenous Purchase and Tenders

a) Limited Tender : 14-21 Days

b) Open Tenders : 21-30 Days

However, a shorter bidding time may be given keeping the urgency of the requirement

with approval of competent authority (In case where CPA is Director and above

approval from concerned Director shall suffice) provided the time allowed is

reasonable for bidding.

In case of procurement on nomination basis / OEM purchase / Proprietary items /

Spares a shorter bidding period may be considered. However, the same should be

reasonable for submission of the bid.

The time allowed for bidding is to be reckoned from the date of publication of NIT in

newspaper / PLL website.

10. BID VALIDITY

10.1. The bids submitted should have validity period as specified. Only those bids

which conform to the bid validity period as specified in the Bid Documents shall

be valid. Bids of shorter validity will not be considered.

The bidders may be asked to keep their offers valid for acceptance as under;

a) Domestic Tender : 60 to 90 days (2 - 3 months)

b) International Tender / LSTK / EPC : 90 to 120 days (3- 4 months)

10.2. Extension of Bid Validity

The Tender should be finalized within the original Bid validity and, extension of Bid

validity should be avoided. In exceptional circumstances after recording the reasons


51

the extension may be sought.

In response to the request for validity extension a bidder may extend the validity on

the same terms, condition and price. The corresponding extension in the Bid

security may also be sought. A bidder has options not to extend the Bid validity if

he so desires without forfeiting the bid security.

11. PRE- TENDER CONFERENCE & PRE BID MEETING

11.1. PRE TENDER CONFERENCE: A pre- tender conference may be held for all major

tenders, which are complex in nature or are being procured for the first time or

where insufficient competition has been experienced earlier, for procurement of

materials, works & services so as to add clarity to specifications, drawing / data,

scope of supply, works & services and special/specific requirements pertaining to

the materials, works & services being indented for tendering. During such meeting

the perspective Bidders are invited to attend the meeting the scope, specification

packaging are discussed wherein the perspective bidders also makes some

suggestion which improves the tender document.

The relevant inputs received from the prospective bidders during pre-tender

meeting needs to be deliberated by the Tender Committee for BEC finalization and

suitably incorporated.

In PTC, all issues pertaining to scope, specifications, design details / data, specific

requirements, if any, etc. shall be open for discussion, except for commercial terms

and conditions of tendering process, which may of course be opened for

discussions to some extent with prior approval.

11.2. PRE BID MEETING: In case of Open tender after floating the NIT the pre Bid

meeting to be held with the perspective Bidders so as to resolve any queries in

respect to Tender. The date, time & venue at which the pre-bid conference

is to be conducted shall be indicated in tender document. Pre-bid conference

is to be convened on the specified date, time and venue. In case of open

tendering, bidders having submitted tender fee will only be permitted to attend pre-

bid conference.

11.3. As a result of pre-bid conference, based on the inputs received from the

prospective bidders, if required, amendment will be issued to the tender

document to the Bidder who have purchased the tender document. Such


52

Amendments / corrigendum shall require the approval of competent authority.

11.4. As a result of Pre bid conference if there is substantial change in the tender

document like scope of work, specification, delivery / completion period which

requires increase in bidding time then a reasonable extension in due submission

date may be given.

11.5. The Bidder shall be given reasonable time after the Pre bid conference for

submission of Bids after Pre Bid conference.

11.6. The Bidder should be advised to send their queries if any at least three days prior

to schedule date of pre bid conference, this shall enable PLL to study the queries

raised by Bidders well in advance. However the Bidder can also raise the queries

during the Pre Bid conference.

11.7. The pre Bid conference shall be organized by Indentor / C&P Department and to be

attended by member of Tender committee or its representatives.

11.8. The record note of Pre bid conference shall be prepared by Indenter & C&P officials

who has attended the pre Bid conference.

12. RECEIPT OF BIDS

12.1. The Bid shall be received in following manner :

I. Bids to be put directly in Tender box by the Bidders

II. Received by ordinary / Regd. Post / courier by receipt and dispatch section

III. Hand delivery to the C&P section, only in cases where the size of the Bid is so

voluminous that the Bid cannot be put in tender box.

IV. In case of E-tendering, the bids shall be received in e portal of PLL. However, the

documents like EMD / Bid Bond / Power of attorney may be submitted physically.

V. In case the Bidders are required to submit a sample, the same shall be handed over

to the dealing officer of C&P department / receipt and dispatch section.

VI. The receipt and dispatch section shall put date and time on the envelopes / packets

received. In no circumstances the envelope containing the Bids will be opened or

destroyed by Receiving Section.

VII. All bids received after the notified time and date of closing of tenders will be

treated as late bids and shall not be entertained

12.2. A tender box of appropriate size shall be kept at reception. Tender Box will always be

kept locked by two locks. Key of one lock will be under the custody of HOD-C&P and

key of other lock will be with the designated officer of Finance Department.


53

12.3. Accounting of the Bids

The designated Tender receiving officer and nominated Finance officer will take

out at Bid closing hour all the Bids from Tender Box and put their initial on the Bids

and the same shall be handed over for opening to concerned officer.

13. OPENING OF TENDERS

I. The tenders can be opened on any working day. If any due date happens to be

unscheduled holiday then next working day may be fixed. The Tenders / bids (un-

priced / techno-commercial & price Bid) will be opened by representative each from

C&P, Finance and Indentor. However, in case of Price Bid opening, a

representative each from C&P, Finance and Indentor is required (where tender

committee is not in place).

II. Un-priced / techno-commercial part of tender shall normally be opened within one

hour after the due date & time of submission of Bid.

III. Tender opening officers shall put their signature with date in tender opening register

and also on the Bids.

13.1. NUMBERING OF TENDERS

All the tenders shall be given serial numbers. As for example, if 7 bids have been

received against one particular enquiry, then bids should be numbered as 1/7, 2/7

and so on. The bids which are received by post after due date should be marked

'Late' tender with No. 8/7 and so on. All envelopes along with the covering page of

the tender are to be initialled by the tender committee or, concerned officers

authorised to open the tenders. The samples received along with the tenders should

also be initialled. If it is not possible to sign on the samples then those samples

should be properly covered mentioning the name of the firm.

13.2. DISCLOSURE OF PRICES / READING OUT THE RATES

All tender of value Rs 1 Cr and above shall be opened in presence of Bidder's

representatives. The Bidder’s name, bid price, discount (if any) and any such details

considered appropriate shall be read out during the price bid opening. Bids should

not, repeat not, be circulated amongst bidder’s representative. Bids should be

considered as confidential document.

The officers opening the tenders should verify that only bidders / authorised


54

representatives of bidders who have actually submitted the bids are present.

Unauthorised representatives (or representatives of firms who have not submitted

the bid) should not be allowed to be present.

13.3. EXTENSION OF BID SUBMISSION DATE

13.3.1. Extension of bid due date should be avoided, as far as possible. However, where it

is inescapable, concerned C&P group or the group which has invited the tender,

will process the case for extension through the Indenting / Project department for

approval of Competent Authority for ordering / award. However, where Competent

Authority for ordering / award is Director and above, approval of concerned Director

shall suffice.

13.3.2. The extension of due date should not be a routine matter. While considering

extension of due date in exceptional situation valid reasons should be recorded as

to why extension on completion schedule should be considered.

13.3.3. In case of system failure under e- tendering, on certification from system

Administrator, extension shall be given 3 days in case of ICB and 1 day in case of

domestic tender with the approval of GM/DGM/ Project Head in case of projects.

13.3.4. Extension of Bid submission date should not be a routine manner and only be done

in an inescapable situation.

13.4. E-MAIL OFFERS

E-mail Offers will not be accepted. However, in case of OEM / PAC purchases from

single source or where source of supply is pre-fixed, E-Mail offers may be

considered.

14. BID SECURITY / EARNEST MONEY DEPOSIT (EMD)

EMD / Bid security / Bid bond is obtained from bidders as instrument so that the

bidder does not withdraw / modify his offer within the validity period thereby causing

inconvenience to PLL. The amount of EMD / Bid bond shall be determined in

accordance with cost estimate of items / works / services procured under the subject

Tender as detailed hereinafter.


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14.1. EXEMPTION FROM SUBMISSION OF BID SECURITY

No bid security / EMD will be necessary for purchases upto Rs.7 lakhs. Earnest money

shall also not be necessary for purchase / service contracts on nomination / PAC /

OEM basis.

Competent authority may also waive submission of bid security / EMD as per DoA in

exceptional circumstances.

14.2. AMOUNT OF BID SECURITY

The following slab based on cost estimate shall be used to determine Bid Security /

EMD.

Amount of Cost Estimate Amount of EMD / Bid Security

<= Rs.7 Lakh Nil

>Rs.7 Lakh, <= Rs. 10 Crore @1.5% of total estimated value of tender,

rounded off to nearest hundred rupees

>Rs. 10 Crore, <= Rs. 25

Crore

Rs. 15 Lakhs + 1% on amount exceeding Rs. 10

Crore, rounded off to nearest hundred rupees

>Rs. 25 Crore Rs. 25 Lakhs + 0.5% on amount exceeding Rs.

25 Crore, rounded off to nearest hundred rupees

The Bid Security / EMD should be valid for 30 days beyond the Bid validity. The

closing Base Currency selling market rates (in USD) on the date of approval of BEC

may be used for conversion of Indian Rupees into foreign currency for arriving the

amount of bid security / EMD in USD.

14.3. EXTENSION OF BID SECURITY

In case during the evaluation of the Bid if PLL seeks extension of Bid validity, Bidder

may extend the Bid validity on the same terms and conditions and corresponding

extension to the Bid bond. If Bidder opts for not extending the validity his EMD

cannot be forfeited and the same shall be returned to the Bidder.

14.4. FORFEITURE OF EMD / BID SECURITY

The conditions under which the Bid Security shall be forfeited shall also be specified


56

in the Instructions to the Bidders. The Bid Security shall be liable to be forfeited as

per the Bid Documents as stipulated in the Invitation to Bid or Instructions to the

Bidders. The grounds of forfeiture may be the following:

i) If the offer is withdrawn within the Bid validity.

ii) If the bid is altered/ modified within its Bid validity.

iii) If the bidder does not accept the LOA issued within the Bid validity.

iv) If the bid is accepted by Petronet LNG Limited and work awarded but the contractor

does not furnish Contract Performance Security.

v) If the bidder submit the forged document and is indulged in the fraudulent practice

the EMD shall be enchased, further the bidder should be put on holiday after

following the due process.

For invoking the bid security / EMD, approval of competent purchase authority may be

obtained as per DoA, for the cases beyond the powers of Director, the concerned

Director has full powers to approve invocation the bid security / EMD.

“In case of forfeiture of EMD/ Bid Security, the forfeited amount will be considered

inclusive of tax and tax invoice will be issued by PLL. The forfeiture amount will be

subject to final decision of PLL based on other terms and conditions of order/ contract.”

14.5. RETURN OF BID SECURITY

The Bid Security shall be returned to the unsuccessful bidders expeditiously

after the award of the work to the successful bidder and acceptance thereof. The

Bid Security / EMD of successful bidder will be returned on receipt of Security

Deposit / Performance Bank Guarantee.

14.6. MODE OF SUBMISSION OF BID SECURITY / CONTRACT PERFORMANCE

SECURITY

Generally the Bid Security / Contract Performance Security can be in the form of a

Bank Guarantee from any of the Indian Scheduled Banks. However, keeping in view

of the particular conditions of the bidders, the Bid Security in the form of Bank Demand

Draft, Banker’s Cheque, a letter of credit to be denominated in the currency of contract

for the amount as applicable may be accepted.

The Bank Guarantee can be submitted from any following Bank:

I. Any schedule Indian Bank or any branch of international bank situated in IndiaDocument downloaded on 09-04-2022 07:07:28 by

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and registered with RBI as schedule foreign bank in case of domestic Bidder or,

II. In case of Foreign Bidder, the Bank guarantee can be accepted from any schedule

bank in India or from an International bank who has its Branch in India and

registered with RBI as schedule foreign bank or,

III. Any foreign bank which is not a schedule bank in India, provided that Bank

Guarantee issued by such bank is counter guaranteed by any schedule bank

Incorporated in India.

In addition to above, the bidder can also submit the EMD through online banking

transaction i.e. IMPS/NEFT/RTGS etc.

For this purpose, the details of PLL’s Bank Account i.e. Account Holder’s Name,

Account Number, IFSC Code & other details are to be provided in the tender document

after obtaining it from their concerned F&A Department.

While remitting, the bidder must indicate EMD and tender/E-tender no. under remarks.

Bidders shall be required to submit/ upload the successful transaction details along-

with their bid/e-bid. In absence of submitting/ uploading the remittance details, the bid

is likely to be considered as bid not accompanied with EMD.

Further, in case of the online transaction, submission of EMD in original is not

applicable.

14.7. EXAMINATION AND VERIFICATION OF BANK GUARANTEE

All Bank Guarantee received, after comparing the tender / contract no., validity, name

of the party on whose behalf it has been issued the C&P department shall forward to

Finance department. The finance Department shall check the following:

I. Whether the language of the BG is as per the format provided by PLL

II. In case of any discrepancy with regarding the value of non-judicial stamp and

change / modification of language by the bank, the BG shall be examine by legal

department.

III. In order to know the authenticity of the BG submitted by the party the finance

department shall take up the matter with the issuing Bank.


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15. PERFORMANCE BANK GUARANTEE (PBG) / SECURITY DEPOSIT (SD)

The PBG/security deposit takes care of many liabilities/risks arising during the

execution of contract and performance of the executed job during Defect Liability

Period. Accordingly, the CPBG/ security deposit is returned only after the expiry of

Defect Liability Period.

The monetary limit for security deposit / Performance Bank Guarantee (PBG) will

be as under;

SN Types Value

(i) Procurement of goods /

materials

10 % of order/contract value.

(ii) Contracts for Turnkey

Project / Construction

10% of Contract Value.

(iii) All type of service

including AMC/ARC

10% of contract value for a contract of one

year duration.

If the duration of service contract is for more

than one year the contractor to provide PBG

of 10% of one year contract price, however

its validity should cover three months beyond

total contract period.

(iv) Consulting service

contract

NIL

The Order / Contract value to be considered excluding statutory taxes, duties and

levies as part of terms and conditions of contract as mentioned in DoA.

The Validity of PBG should be three months beyond total contract Period. For any

kind of procurement / service / contract valuing upto Rs. 7 lakh, no SD / PBG shall

be taken. Also, for Procurement of Material or services from OEM / Manufacture/

authorized dealer / distributor/ sole selling agents / Hiring of Services from OEM /

OES and procurement of items on PAC basis SD / PBG shall not be taken.

Contract Performance Bank Guarantee is to be submitted by bidder within 30 days

after issuance of Letter of Acceptance (notification of Award) and in event of delay

in submission of CPBG / SD, the contract can be terminated.


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However, if termination of contract is not in the interest of PLL, an additional time of

30 days can be allowed (while maintaining the validity of EMD for the requisite

period) for submission of CPBG / SD with the approval of competent authority who

has approved the order/ award, beyond which (depending upon the progress of the

order) it shall constitute sufficient ground for termination of order/ contract and

subsequent actions following termination as per the tender. However, where the

Competent Authority for placement of order is Director or above, such approval shall

be sought from the Director concerned.

“In case of forfeiture of PBG, the forfeited amount will be considered inclusive of tax

and tax invoice will be issued by PLL. The forfeiture amount will be subject to final

decision of PLL based on other terms and conditions of order/ contract.”

15.1. CONTRACT PERFORMANCE BANK GUARANTEE (CPBG)/ SECURITY

DEPOSIT (SD) FOR EXTRA WORKS

The extra work/change order is incidental to the main works covered under the

contract. The contract empowers Engineer-in-charge (EIC) to make alteration in

specification, design and extra work. The CPBG/security deposit has to cover the

entire executed contract value which includes extra work also.

It is clarified that the EIC has to monitor the value of executed work including extra

work and once it is envisaged that total executed value is likely to burst the ceiling

of contract price, the contractor should be asked to furnish additional security

deposit/CPBG. However, as long as the CPBG/security deposit already submitted

at the time of award take cares of extra work executed and the total executed value

are within the contract price, there is no need to ask for additional security

deposit/CPBG for each extra work.

15.2. REDUCTION IN CONTRACT PERFORMANCE BANK GUARANTEE (CPBG)/

SECURITY DEPOSIT (SD) IN CASE OF REDUCTION IN THE SCOPE OF WORK

In case of an exceptional situation where the scope of the contract is reduced

beyond certain specified percentage, on its merit, with the recommendation and

approval of the Competent Authority after having financial concurrence, the contract

will have to be amended for reduction in CPBG. While making such

recommendation, reasons for reduction in the scope of work; all risks/liabilities


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arising during the execution of the contract to be borne by contractor and

performance of the job during the Defect Liability Period, etc. are to be analysed in

terms of the contract provision.

16. UNSECURED ADVANCE ON PROPRIETARY IMPORT

Although any unsecured advance payment is not advisable but in exceptional cases

involving procurement of proprietary items where foreign supplier do not agree to

supply without advance payment and requirement cannot be met through any other

sources, such requests limited to payment upto US$ 15000.00 (or equivalent other

foreign currency) should be carefully examined and accepted only with the approval of

authority who has power to write off amounts due to the company as per delegation of

power. This shall, however, be subject to prevailing RBI regulations. Further, this

should be used in exceptional cases as to meet operational/ urgent requirements.

17. E-PAYMENTS

All payment to Indian contractors and vendors will be made through existing system of

e – payment module only. In case contractors and vendors do not have their account

in one of the designated banks, payment to such contractor and vendors can be made

through NEFT/ RTGS.

18. REPEAT ORDER

The repeat order should be considered only in exceptional circumstances, as the

buyer loses the advantage of competitive Bidding.

i. The repeat order can be made with the approval of competent authority as per

delegation of power in following manner :

Upto 50% of original ordered quantity on same terms and conditions within the 6

months from the date of order provided indenter/user department certifies that:

a) There is an apparent escalation in prices in the market and no unintended benefit

to be passed on to the Vendor/contractor; or

b) The normal processing of the case is likely to delay the procurement adversely

affecting the work; or

c) Special approvals have been obtained for any projects from Boards, etc.


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ii. Repeat order shall not be placed where original tender is finalized on single tender

-nomination basis , emergency purchase , negotiated purchase, or where the

market shows downward trend or where order was placed on consideration other

than lowest prices.

iii. The repeat order should not undo what has been intended within overall delegated

authority of the office concerned.

iv. Repeat order provisions should not be considered as a mode of procurement in

place of following normal tendering procedure against a new requirement. The

process of tendering should be initiated well in advance and new contract/ order to

be finalized before expiry of previous order/ rate contract.

19. PURCHASE OF CAPITAL ITEMS AND SPARES THEREOF

As a matter of principle, while tendering for equipment, the bidders should be asked

to quote separately in service materials and spares which are necessary for one or

two year’s operation of the plant and equipment. It should be made clear to the

bidders that they should quote the prices for each item of the spares separately.

For purposes of comparison of the prices quoted for the main plant and equipment,

the prices of commissioning and mandatory spares will be taken into account. O&M

spares will not be evaluated for comparison purposes.

20. CLAUSES IN SUPPLY ORDER/ INVITATION OF TENDERS

20.1 WARRANTY AND GUARANTEE

i) In the case of equipment the warranty for a period of 24 months from the date of

shipment or 12 months from the date of commissioning of the equipment, whichever

is earlier, will be obtained.

ii) The Warranty period in case of turnkey projects will be obtained for 12 months

from the date of satisfactory commissioning and handing over of the complete

project to PLL

iii) The Bank Guarantee for warranty period in the case of equipment shall be insisted

upon. The Bank Guarantee for warranty in the case of turn-key project contracts

will be essential and insisted upon and failure to comply with this will be rejection

criteria of the Tender document.

20.2 FAILURE AND TERMINATION CLAUSE

If vendor / contractor fails to deliver entire quantity of materials ordered/ complete


62

the work or a part thereof within the contractual delivery / completion period agreed

to for such part or total quantity as per the delivery / time schedule or at any time

repudiates the contract before the expiry of such period, PLL may without prejudice

to any other right or remedy available to it recover damages for breach of the

contract in accordance with its provisions:

(a) Recover from the vendor/ contractor an agreed amount towards Price Reduction

Schedule and not by way of penalty a sum equivalent ½% (half per cent) of the

contract price of the whole unit per week for such delay or part thereof (this is a

genuine pre-estimate of damages duly agreed by the parties) which the vendor/

contractor has failed to deliver with in the period fixed for delivery in the schedule,

where delivery thereof is accepted after expiry of the aforesaid period.

It may be noted that such recovery of PRS may be up to 5% of the contract price /

of the total quantity of items of materials / equipment which the contractor has failed

to deliver within the period fixed for delivery; or

(b) Purchase or authorize the purchase from elsewhere at the cost and risk of the

contractor, the material not delivered or other such material of similar description,

by serving prior notice to the contractor / supplier without cancelling the contract.

or

(c) Cancel the contract or a portion thereof by serving prior notice to the contractor and

if so desired, purchase or authorize the purchase of the materials not so delivered

or other of a similar description (where such materials exactly complying with

particular are not, in the opinion of the purchaser, which shall be final, readily

procurable) at the risk and cost of the contractor. If the contractor had defaulted in

the performance of the original contract, the purchaser shall have the right to ignore

his tender for risk purchases even though the lowest. Where the contract is

terminated at the risk and cost of the firm under the provisions of this clause, if shall

be solely upto the purchaser to exercise his discretion to collect or not, the security

deposit from the firm, on whom the contract is placed, at the risk and expense of

the defaulting firm.

(d) Where action is taken under sub-clause (b) or sub-clause(c) above, the contractor

shall be liable for any loss which the purchaser may sustain on that account,


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provided the purchase or if there is an agreement to purchase, such agreement is

made, in case of failure to deliver the materials within six months from the date of

such failure and in case repudiation of the contract within six months from the date

of cancellation of contract. The contractor shall not be entitled to any gain on such

purchase and the manner and method of such purchase shall be at the entire

discretion of the purchaser. It shall be necessary for the purchaser to give a notice

of such purchase on the contractor.

(e) It may further be noted that clause (a) above provides for recovery of PRS on the

cost of contact price of delayed supplies (whole unit) at the rate of 1/2% (half per

cent) of the contract price of the whole unit per week for such delay or part thereof

upto a ceiling of 5% of the contract price of delayed supplies thus accrued will be

recovered by the paying authorities of the purchaser specified in the supply order,

from the bill for payment of the cost of the material submitted by the vender/

contractor in accordance with terms of supply order, or otherwise.

(f) Notwithstanding anything stated above equipment and materials will be deemed to

have been delivered only when all its components, parts are also delivered. If

certain components are not delivered in time the equipment and material will be

considered as delayed until such time all the missing parts are also delivered.

20.3 FALL CLAUSE (APPLICABLE IN CASE OF MATERIAL PROCUREMENT

THROUGH RATE CONTRACT, NOMINATION AND PROPRIETARY AWARD)

(i) The price charged for the materials supplied under the contract / supply order by

the contractor / supplier shall in no event exceed the lowest price at which the

supplier / contractor or his agent / principal / dealer, as the case may, sells the

materials or others to sell materials of identical description to any persons /

organizations including the purchaser or any department of the central Government

or any Department of a State Government or any Statutory Undertaking of the

Central or State Government, as the case may be, during the currency of the

contract / supply order.

(ii) If at any time, during the said period, the contractor / supplier or his agent / principal

/ dealer, as the case may be, reduces the sale price, sells or offers to sell such


64

materials or any persons / organizations including the purchaser or any department

of Central Government, or State Government, as the case may be, at a price lower

than the price chargeable under the contract / supply order, he shall forthwith notify

such reduction or sale or offer of sale to the Purchase Authority who has issued this

supply order and the price payable under the supply order / contract for the

materials supplied after the date of coming into force of such reduction or sale or

offer of sale shall stand correspondingly reduced. The above stipulation will,

however, not apply to:

a) Exports by the contractor / supplier; or

b) Sale of goods as original equipment at prices lower than the prices charged for

normal replacement.

c) Sale of goods such as drugs which have expiry dates.

(iii) Compliance Methodology: The contractor / supplier shall furnish the below

statements on its certificate on its letter head to the concerned paying authority

along with each bill for payment for supplies made against this supply order /

contract:

I / We certify that there has been no reduction in sale price of the items / goods /

materials of description identical to those supplied to PLL under the contract / supply

order herein and such items / goods/ materials have not been offered / sold by me

/ us to any person / organization including the purchaser or any Department of

Central Government or any Department of a State Government or any Statutory

Undertaking or the Central or State Government, as the case may be, upto the date

of bill / during currency of the supply order / contract whichever is later, at a price

lower than the price charged to PLL under the contract / supply order.

Such a certificate only shall be obtained, except for quantity of items / goods /

materials of categories under sub-clause (a), (b) & (c) of sub para (ii) above of which

details shall be furnished by the supplier.

20.4 INSPECTION & REJECTION OF MATERIALS BY CONSIGNEES

When material are rejected by the consignee, the supplier shall be intimated

promptly with the details of such rejected materials, as well as the reasons for their

rejection, also giving location where such materials are lying at the risk and cost of

the contractor / supplier. The supplier will be called upon either to remove the

materials or to give instructions as to their disposal within 14 days and in the case


65

of dangerous, infected and perishable materials within 8 hours, failing which the

consignee will either return the materials to the contractor on freight to pay basis or

otherwise dispose them of at the contractor's risk and cost. C&P department will

also intimate to the Finance and Accounts department concerned the quantity of

the materials rejected to enable him to recover the freight due at the full public tariff

rates from the contractor. The purchaser shall also be entitled to recover handling

and storage charges for the period, during which the rejected materials are not

removed @ 5% of the value of materials for each month or part of a month till the

rejected materials are finally disposed of.

20.5 SUBLETTING AND ASSIGNMENT

The contractor shall not, save with previous consent in writing of the Engineer-in-

charge, sublet, transfer or assign the contract or any part thereof or interest therein

or benefit or advantage thereof in any manner whatsoever. Provided, nevertheless,

that any such consent shall not relieve the contractor from any obligation, duty or

responsibility under the contract.

However, Subletting of WHOLE WORKS is prohibited. An undertaking to this effect

will be given by Vendor/ Contractor along with each invoice/ bill.

20.6 EARLIER DELIVERY

i) When contracts are placed at higher rate for the sake of earlier delivery, the clause

as given below, enabling PLL to realize compensation for the extra cost due to delay

in supply must be included therein;

It should be noted that on your assurance of delivery of materials strictly as per

agreed schedule, this order has been placed on you in preference to the lowest

acceptable tender. In case of failure to complete supplies against this contract in

terms thereof within the date of delivery specified herein, you would be liable to pay

to the PLL, the difference between the contract rates and those of the lowest

acceptable tender, i.e., Rs. _______ per unit, notwithstanding the fact that the delay

in supply may have been caused by force majeure. This is without prejudice to the

right of the PLL to receive all other losses and right of cancellation and repurchase

at your risk and expense.”


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ii) The following clause will invariable be included in all invitations to tenders:-

It should be noted that if a contract is placed on a higher bidder as a result of this

tender, in preference to the lowest acceptable offer, in consideration of an earlier

delivery, the contractor will be liable to pay to PLL the difference between the

contract rate and the rate quoted by the lowest acceptable bidder in case of failure

to complete the supply in terms of such contract within the date of delivery specified

in the tender and incorporated in the contract. This is without prejudice to other

rights and remedies available to PLL, under terms of contract.”

20.7 PILOT APPROVAL (WHEREVER APPLICABLE)

i) Before commencing bulk supply if necessary, the supplier may be asked to forward

two sets of samples supported by two sets of their manufacturing drawings for

approval of the Inspecting Officer. Such an approval by Inspecting Officer may need

atleast 15 days’ time, which should be catered for by supplier within the delivery

schedule. Inspecting Officer would return one set of the samples and one set of

manufacturing drawings duly signed for supplier's guidance in bulk supply.

ii) Supplier will make available free of charge all testing facilities in his plant to the

inspecting officer to enable him to test the sample and carry out inspection. Supplier

will arrange for any test desired by the Inspecting Officer at any other test house /

laboratory as approved by the Inspecting Officer. If facilities for such test are not

available in his plant. The test charges would be reimbursed by the purchaser if the

samples are considered acceptable whereas if the test charges would be borne by

the supplier.

20.8 BULK INSPECTION (WHEREVER APPLICABLE)

i) The bulk shall be accepted in accordance with the samples approved. The inspector

shall be given sufficient notice which shall not be less than 21 working days to plan

out the bulk inspection. Percentage would be arranged by the supplier on the same

lines as in case of the pilot samples and the test charges would be dealt with

accordingly.

ii) Sampling procedure will be as per the requirement of the inspection authority.

iii) The materials rejected by the inspecting officer during this inspection will be

replaced by the supplier immediately, latest within two weeks of such rejections.

Any rejection by the inspection officer shall be considered final and binding.


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20.9 GENERAL CONDITIONS

i) When the materials are dispatched to the consignee intimation must also be given

to this effect. Reference to the supply order should invariably be given in all the

relevant correspondence.

ii) The tender is liable to be rejected in case the tender does not comply with tender

stipulations or the goods, works and services offered do not conform to the required

specification indicated there in.

iii) Any other terms and conditions offered by the firm and not included in the

order/contract, are not acceptable to PLL.

20.10 RESOLUTION OF DISPUTES / ARBITRATION

Provision of resolution of disputes / arbitration shall be stipulated in General

Purchase Conditions and General Conditions of Contract, which provides for

dispute resolution mechanism in accordance with the prevailing Arbitration &

Conciliation Act, 1996 as amended from time to time.

20.11 LOADING AND REJECTION CRITERIA

20.11.1. As per tender terms and conditions, bidders are advised to submit their bids in strict

compliance with the specifications and other stipulations contained therein. They

are further advised not to stipulate deviations.

20.11.2. The bidders are required to comply with the tender conditions. Tender should have

rejection criteria where the deviation is not acceptable. However, if considered

appropriate financial loading for acceptable deviation should be incorporated

upfront.

20.11.3.

a) In addition to the above, some of the tender conditions require submission of data

by the bidder. If such details have been foreseen, the same should be described in

the Tender Document with clarity including the method of evaluation of the data so

received. Some of such requirements are :-


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i) Stipulations for cement and steel consumption in turnkey civil packages, where

cement and steel are envisaged to be supplied by PLL, for reasons of quality control

and timely availability.

ii) Stipulations for Boil Off Gas generation, power and other such utilities, where these

are to be evaluated for assessing overall economics in operation of plants procured

through turnkey packages.

iii) Provisions pertaining to compensation for extended stay for construction works

awarded when such delays can be reasonably anticipated solely for reasons

attributable to PLL and are considered advantageous to invoke instead of resorting

to repeated reissue of tenders, during execution stage. Payment of mobilization

advance, if so required by the bidder, while submitting offers.

b) There may be similar other terms and conditions calling for evaluation of their

impact on the price quoted by the bidder(s). As such, it is imperative that not only

such stipulations and the expected data from bidders are explicitly and clearly

indicated in tender documents, but also the manner in which at the same shall be

evaluated should be stated unambiguously, as the loadings on these counts may

alter the status of bidders while comparing the prices quoted by them.

20.11.4. The tender document shall also explicitly include all such terms and conditions as

are considered absolutely necessary to be acceptable by bidders, without any

deviations. It should also be clearly stipulated that any deviations to these will

render the bid liable for outright rejection. Broadly, the following to be included in

the tender as rejection criteria:

i) Firm Price

ii) EMD/ Bid Bond

iii) Scope of work

iv) Specifications

v) Price Schedule

vi) Delivery / Completion Schedule

vii) Period of validity of bid

viii) Price reduction schedule

ix) Performance Bang Guarantee / Security Deposit

x) Guarantee of material / workDocument downloaded on 09-04-2022 07:07:28 by

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xi) Arbitration / Resolution of Dispute

xii) Force Majeure

xiii) Applicable Laws

xiv) Integrity Pact, if applicable

xv) Any other condition specifically mentioned in the tender documents elsewhere that

non-compliance of the clause lead to rejection of the bid.

Deviation to the clause if considered acceptable with financial loading declared in

tender document shall not be included in rejection criteria.

20.12 ABNORMALLY HIGH RATES ITEMS (AHR)

The following provision be invariably incorporated in the special conditions of

contract of the tenders for works/ service contracts:

“In items rate contract where the quoted rates for the items exceed 50% of the

owners / estimate rates such item will be considered as abnormally high rates items

(AHR) and increase in quantity after ordering for AHR item needs to be avoided.

However, in exceptional circumstances, payment of AHR items beyond the SOR

stipulated quantities shall be made at the least of the following rates:-

i) Rate as per SOR, quoted by the contractor.

ii) Rate of the item, which shall be derived as follows:

A. Based on rates of machine and labour as available from the contract (which

includes contractor’s supervision profit, overheads and other expenses)

B. In case rates are not available in the contract , rates will be calculated based on

prevailing market rates of machine, material and labour plus 15% to cover

contractor`s supervision profit, overhead & other expenses.”

20.13 PERCENTAGE TENDERING

In case of civil contracts including civil ARCs/ AMCs where proper in-house

estimate available, tender may be invited on percentage tender basis.

In percentage tender, estimated item wise rates are to be mentioned in the tender

but the bidders are required to quote only the percentage (plus or minus) over

the total estimated amount of package / part / section as per evaluation

methodology.


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The above will ease preparation of comparative statement and also eliminate the

possibility of abnormally high rates for individual items.

20.14 PROCEDURE FOR BUY-BACK ITEMS & TENDER PROVISIONS

Technological advancement and obsolescence have reduced in the replacement of

old existing plant and machineries in PLL. As such with the passage of time and as

PLL is growing, the requirement of new items in place of old/obsolete items is also

increasing. PLL may invite tender(s) for procurement of new item(s) with a buy back

clause in the tender(s).

Keeping in view the need of transparency in dealing in buy back items, the tender

where buy back items is involved and the bidder is required to quote for new item

(s) / installations and is also required to take back the old item (s) / machines, the

tenders are to be prepared in the manner stated below:

a. The details of old item(s) and quantity (ies) shall be indicated in the tender

document.

b. The tender will have a provision and separate line item (s) in the SOR to quote

separate price for old item(s)/ buy back price of old item(s) by the bidder.

c. While evaluating the bids, the quoted price for old item(s)/ buy back price of old

item(s) plus applicable GST on buy pack prices is to be reduced from the quoted

price of the new item (s).

d. The removal of old item (s) is to be done in SAP following the process adopted for

“sale of old capital goods/ scrap items, as the case may be. The invoice for old items

(s) shall also be raised in SAP only.

e. In case the buyback price of old items is less than written down value (WDV), then

write off approval is required from competent authority.

f. In case of buy back PLL is to raise invoice for buy back items and pay GST to Govt.

department. Therefore, Buy back price and applicable GST is to be deducted while

evaluating the offer

Further the tender shall stipulate the following procedure to be followed by PLL and

vender/ contractor:

1. That old materials are to be handed over to the vendor/contractor

in terms of the contract with proper documentation on "as is where basis is”. The


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vendor/contractor is required to take away such materials out of PLL immediately

after handing over to them.

2. That the vendor/contractor will not sell these materials to any PLL employee

without written permission of HR Department- PLL, to be obtained by the PLL

employee (s)

Even after permission is obtained by employee(s) from PLL, the contractor is free

to take decision whether to sell such item (s) to PLL employee (s) or not.

3. That vendor/contractor will accept payment only by cheque/ demand draft for sale

of old item(s) to PLL employee(s).

4. That vendor/contractor will maintain a separate record for such sales to PLL

employees and will make the same available as and when requested by PLL.

20.15 PROVISION WITH RESPECT TO TAXES IN RFQ/ TENDER DOCUMENT

A. Where the PLL is entitled to avail the input tax credit of GST (CGST &

SGST/UTGST or IGST) and there is certainty at the time of bid evaluation about

the quantum of input tax credit available for the tendered goods/services/ works.

Owner/PLL will reimburse the GST (CGST & SGST/UTGST or IGST) to the Supplier

of Goods / Services (Service Provider) at actuals against submission of Invoices as

per format specified in rules/ regulation of GST to enable Owner/PLL to claim input

tax credit of GST (CGST & SGST/UTGST or IGST) paid. In case of any variation in

the executed quantities, the amount on which the GST (CGST & SGST/UTGST or

IGST) is applicable shall be modified in same proportion. Returns and details

required to be filled under GST laws & rules should be timely filed by supplier with

requisite details.

The input tax credit of GST (CGST & SGST/UTGST or IGST) quoted shall be

considered for evaluation of bids, as per evaluation criteria of tender document.

B. Where the PLL is not entitled to avail/take the full input tax credit of GST (CGST &

SGST/UTGST or IGST) or there is uncertainty at the time of bid evaluation about

the quantum of input tax credit available for the tendered goods/services/ works:

Owner/PLL will reimburse GST (CGST & SGST/UTGST or IGST) to the Supplier of

Goods / Services (Service Provider) at actuals against submission of Invoices as

per format specified in rules/ regulation of GST subject to the ceiling amount of GST

(CGST & GST/UTGST or IGST) as quoted by the bidder, subject to any statutory

variations, except variations arising due to change in turnover. In case of any


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variation in the executed quantities (If directed and/or certified by the Engineer-In-

Charge) the ceiling amount on which GST (CGST & SGST/UTGST or IGST) is

applicable will be modified on pro-rata basis.

The bid will be evaluated based on the total prices including GST (CGST &

SGST/UTGST or IGST).

C. PLL will prefer to deal with registered supplier of goods/ services under GST.

Therefore, bidders are requested to get themselves registered under GST, it not

registered yet.

However, in case any unregistered bidder is submitting their bid, their prices will be

loaded with applicable GST (CGST & SGST/UTGST or IGST) while evaluation of

bid. Where PLL is entitled for input credit of GST (CGST & SGST/UTGST or IGST),

the same will be considered for evaluation of bid as per evaluation methodology of

tender document.

D. In case PLL is required to pay entire/certain portion of applicable GST (CGST &

SGST/UTGST or IGST) and remaining portion, if any, is to be deposited by Bidder

directly as per GST (CGST & SGST/UTGST or IGST) laws, entire applicable

rate/amount of GST (CGST & SGST/UTGST or IGST) to be indicated by bidder in

the SOR.

Where PLL has the obligation to discharge GST (CGST & SGST/UTGST or IGST)

liability under reverse charge mechanism and PLL has paid or is /liable to pay GST

(CGST & SGST/UTGST or IGST) to the Government on which interest or penalties

becomes payable as per GST laws for any reason which is not attributable to PLL

or ITC with respect to such payments is not available to PLL for any reason which

is not attributable to PLL, then PLL shall be entitled to deduct/ setoff / recover such

amounts against any amounts paid or payable by PLL to Contractor / Supplier.

E. Supplier shall ensure timely submission of correct invoice(s), as per GST rules/

regulation, with all required supporting document(s) within a period specified in

Contract to enable PLL to avail input credit of GST (CGST & SGST/UTGST or

IGST). Further, returns and details required to be filled under GST laws & rules

should be timely filed by Supplier of Goods / Services with requisite details.

If input tax credit is not available to PLL for any reason not attributable to PLL, then

PLL shall not be obligated or liable to pay or reimburse GST (CGST &

SGST/UTGST or IGST) claimed in the invoice(s) and shall be entitled to deduct /


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setoff / recover such GST amount (CGST & SGST/UTGST or IGST) or Input Tax

Credit amount together with penalties and interest, if any, against any amounts paid

or becomes payable by PLL in future to the Supplier/Contractor under this contract

or under any other contract.

In case CBIC (Central Board of Indirect Taxes and Customs)/ any tax authority /

any equivalent government agency brings to the notice of PLL that the Supplier has

not remitted the amount towards GST (CGST & SGST/UTGST or IGST) collected

from PLL to the government exchequer, then, that Supplier shall be put under

Holiday list of PLL for period of six months after following the due procedure. This

action will be in addition to the right of recovery of financial implication arising on

PLL.

F. ANTI-PROFITEERING CLAUSE: As per Clause 171 of GST Act it is mandatory to

pass on the benefit due to reduction in rate of tax or from input tax credit to the

consumer by way of commensurate reduction in prices. The Supplier of Goods /

Services may note the above and quote their prices accordingly.

(A confirmation to above will also be sought in the Agreed Terms and Conditions).

G. In case the GST rating of vendor on the GST portal / Govt. official website is

negative / black listed, then the bids may be rejected by PLL. Further, in case rating

of bidder is negative / black listed after award of work for supply of goods / services,

then PLL shall not be obligated or liable to pay or reimburse GST to such vendor

and shall also be entitled to deduct / recover such GST along with all penalties /

interest, if any, incurred by PLL. Vendor has to provide the declaration stating that

GST rating of them on the GST portal / Govt. official website is Positive.

H. In case of statutory variation in GST (CGST & SGST/UTGST or IGST), other than

due to change in turnover, payable on the contract value during contract period, the

Supplier of Goods / Services (Service Provider) shall submit a copy of the

'Government Notification' to evidence the rate as applicable on the Bid due date

and on the date of revision.

Beyond the contract period, in case PLL is not entitled for input tax credit of GST

(CGST & SGST/UTGST or IGST), then any increase in the rate of GST (CGST &

SGST/UTGST or IGST) beyond the contractual delivery period shall be to

Supplier/Service Provider’s account whereas any decrease in the rate GST (CGST

& SGST/UTGST or IGST) shall be passed on to the PLL/ Owner.


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Beyond the contract period, in case PLL is entitled for input tax credit of GST (CGST

& SGST/UTGST or IGST), then statutory variation in applicable GST (CGST &

SGST/UTGST or IGST) on supply and services, shall be to PLL’s account.

Claim for payment of GST (CGST & SGST/UTGST or IGST)/ Statutory variation,

should be raised within two [02] months from the date of issue of 'Government

Notification' for payment of differential (in %) GST (CGST & SGST/UTGST or

IGST), otherwise claim in respect of above shall not be entertained for payment of

arrears.

The base date for the purpose of applying statutory variation shall be the Bid Due

Date.

I. New Taxes & duties: Any new taxes & duties, if imposed by the State/ Central Govt.

of India after the due date of bid submission but before the Contractual

Delivery/Completion Date, shall be reimbursed to the Supplier on submission of

copy of notification(s) issued from State/ Central Govt. Authorities along with

documentary evidence for proof of payment of such taxes & duties, but only after

ascertaining it’s applicability with respect to the Order/Contract.

J. For procurement of Goods: The supplier shall mention the particulars of PLL,

(place specified in tender) on the Invoice. Besides, if any other particulars of PLL

are required to be mentioned, under GST rules/ regulations on the date of dispatch,

the same shall also be mentioned on the Invoice.

K. Wherever TDS under GST Laws has been deducted from the invoices raised /

payments made to the vendors, as per the provisions of the GST law / Rules,

Vendors should accept the corresponding GST-TDS amount populated in the

relevant screen on GST common portal (www.gst.gov.in). Further, Vendors should

also download the GST TDS certificate from GST common portal (reference path:

Services > User Services > View/Download Certificates option).

L. E-way Bill for movement of goods under GST Regime have been notified, the

provisions related to E-way bill has been made applicable from 1stFeb. 2018. All

the process/ procedure in this regard is to be followed for inward/ outward

movement of Goods.

20.16 PROVISION WITH REGARD TO LIQUIDATION. BANKRUPTCY OR COURT

RECEIVERSHIP IN TENDER DQCUMENTS (FOR WORK / SERVICE TENDER)

The following provisions to be included in the ITB/RFO of the tenders for


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procurement of works/ services:

The prospective bidders should not be under ‘liquidation’, any 'court receivership

or similar proceedings’ or ‘bankruptcy’ during the processing of the tender.

The bidder shall give an undertaking regarding the same in their bid. In case it

comes to the notice of PLL that the bidder has given wrong declaration in this

regard, the same shall be dealt as ‘fraudulent practices’ and action shall be initiated

as per the procedure for action in case of corrupt / Fraudulent / collusive / coercive

practices.

Further, it shall be the sole responsible of the bidder to ensure that any changes

occurring in their above declaration during the processing of the tender are brought

to the notice of Employer “

Further, in case of ‘liquidation’, any ‘court receivership or similar proceedings’ or

‘bankruptcy’ after award of contract for service/ works suitable action in accordance

with of GCC of the contracts.

20.17 NON-APPLICABILITY OF ARBITRATION CLAUSE IN CASE OF BANNING OF

VENDORS/SUPPLIERS/CONTRACTORS/BIDDERS/CONSULTANTS

INDULGED IN FRADULENT/COERCIVE PRACTICES

Arbitration clause will not be applicable in case of banning of

Vendors/suppliers/contractors/bidders/consultants indulged in fraudulent/ coercive

practices. Accordingly, the following provision is to be included in the ITB

(instruction to Bidder) of tender documents.

“Notwithstanding anything contained contrary in GCC and other “ CONTRACT

DOCUMENTS”, in case it is found that the Vendors/ Suppliers/ Contractors/

Bidders/ Consultants indulged in fraudulent/ coercive practices at the time of

bidding, during execution of the contract etc., and/or on other grounds as mentioned

in PLL’s “Procedure”, the contractor/bidder/vendor/supplier /consultant shall be

banned (in terms of aforesaid procedure) from the date of issuance of such order

by PLL., to such Vendors/ Suppliers/ Contractors/ Bidders/ Consultants and PLL

has the right to take appropriate legal remedy available to it under the applicable

laws. Such disputes shall be governed by the jurisdiction clause of the contract.


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20.18 PROVISION IN TENDER REGARDING PERMANENT ESTABLISHMENT (PE)

W.R.T. FOREIGN BIDDERS

The following provision in respect of PE Status of Foreign Vendors is to be included

in all ICB tenders and in RFQ on OEM / Nomination / Proprietary basis for foreign

bidders:

“Foreign bidders must submit (along with their bid) the following particulars

Which are required to be furnished by PLL to Income Tax Department for

Complying with the requirements for making remittances to non-residents as per

Income Tax Act, 1961 (as amended from time to time):

(i) Certificate of having No Permanent Establishment / No Business Connection in

India.

(ii) In case the non-resident has a Fixed Place Permanent Establishment (PE) or a

Dependent Agency PE in India, in terms of the Double Taxation Avoidance

Agreement (DTAA) between India and his country of tax residence through which

the non-resident carries on business activities in relation to its engagement by PLL,

the address of the Fixed Place PE or name & address of the Dependent Agent is to

be provided.

(iii) Deemed Permanent Establishment: Whether by carrying on activities in relation to

its engagement by PLL, the non-resident constitutes an Installation / Construction

PE or a Service PE in India in terms of the DTAA between India and his country of

tax residence.

(iv) If the non-resident has PE in India, whether the remittances to be made to him under

his engagement by PLL are attributable to such PE or not with reasons thereof.

(v) Non-resident’s complete address in the country of residence along with Local

Contact No. with ISD Code and E-Mail ID of concerned person.

(vi) If the non-resident has an Indian Income Tax Permanent Account Number (PAN),

details of the same.

(vii) Country of tax residence of the non-resident supported by a Tax Residency

certificate (TRC) issued by the Government of country or specified territory to the

effect that the person named therein is a resident of that country or specified

territory along-with Form 10F, if non-resident desire to avail benefits available under

Double Tax Avoidance Agreement(DTAA).


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(viii) If it is not possible for the non-resident to obtain & submit Tax Residency Certificate

to PLL within a reasonable time, the bidder should furnish Form No. 10F along with

an undertaking to the effect that the bidder is a tax resident of (the specified country)

and that they shall obtain and provide the TRC to PLL before 30 days of submission

of first Invoice by them or within 3 months from the date of entering into the contract

whichever is earlier.

(ix) Whether the non-resident is constituted as a company, a partnership firm, or any

other form of business organization.

In addition to above particulars, the bidder should also provide any other information

as may be required later for determining the taxability of the amount to be remitted

to the non-resident. Further, the bidder shall be liable to intimate the subsequent

changes (if any) to the information submitted against any of the above particulars,

along with full details

Bidders should note that if there is any delay in submission / non-submission of

information / documents required as above within the specified time, PLL will be

constrained to deduct tax as per Income Tax Act, 1961. In case, tax liability is to be

borne by PLL as per purchase / work order terms & conditions, any additional tax

liability due to delay in submission / non submission of information / documents

required as above shall be recovered from the supplier /

Contractor / consultant.

TAX INCIDENCE:

a) If bidder insists at the time of bidding that Tax Liability is to be borne by PLL, then

the bidder’s total quoted prices shall be suitably loaded by equivalent amount for

evaluation purpose (depending upon the status of Foreign Vendor based on the

documents submitted by them at the time of bidding) and WHT Certificate will be

issued.

b) In case bidder agrees to bear the WHT as per the provision of Income Tax Act 1961,

no loading on quoted prices towards WHT will be done. The WHT will be deducted

from their payments due to them and WHT certificate will be issued as per IT Act.

c) If the bidder wants to avail the benefit of DTAA, then they have to submit the Tax

Residency Certificate (TRC) issued by Government or Specified Authority of that

country and Form 10F


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d) Bidders should note that any delay in submission of TRC, Form 10F or PE

information within specified time OR any subsequent change in TRC, Form 10F or

PE status after submission of bid, may lead to deduction of tax at higher rate than

at which it would otherwise have been deducted. Such additional tax liability shall

be recovered from the supplier/contractor/ consultant.”

20.19 PEEGING OF FEE PAYABLE TO THE CONSULTANT

The following condition shall be included in the tenders for Appointment of

Architects/Consultants for pegging the Architects/ Consultants fee linked with the

estimated/ awarded cost of project wherever, fees are sought on percentage basis:

“ The percentage (%) fee of the Architect/ Consultant shall be pegged to the lower

of (a) estimated cost of project/ job(s)/ work (s) and (b) the original awarded contract

value of project/ job(s)/ work (s) [combined awarded value of jobs/ works in case of

more than once job/ work under a project].”

Note: Milestone based payments will be formulated to ensure that payment made

at any stage is commensurate with the progress of work.

20.20 TRADE RECEIVABLE DISCOUNTING SYSTEM (TReDS)

Government of India (GoI) introduced a scheme for setting up and operating the

institutional mechanism for facilitating the financing of trade receivables of MSMEs

from corporate buyers through multiple financiers known as Trade Receivables

Discounting System (TReDS). This enables MSMEs to maintain the level of their

Working Capital and process more and more corporate orders with minimum lead

time.

PLL is in process for signing the Master Agreement with M/s ATREDS Ltd (platform

owner)

20.21 APPLICABILITY OF INTEREST ON MOBILIZATION ADVANCE/ADVANCE

Any advance sought by a bidder must be secured and shall bear interest rate

(medium terms) at Marginal Cost of Fund based Lending Rate (MCLR) for one year

charged by SBI (applicable on the date of disbursement of mobilization advance)

plus 2.0% p.a. on reducing balance basis, for which suitable stipulation shall be

made in tenders of PLL wherever applicable.


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The Bank Guarantee etc. taken towards security of ‘Mobilization Advance' should

be at least 110% of the advance so as to enable recovery of not only principal

amount but also the interest portion, if so required.

The mobilization advance should not be paid in less than two instalments (each

maximum of 5%) subject to the fulfilment of the following conditions:

i. First Instalment

5% (five percent) of Contract Value shall be payable as the first instalment of

Mobilization Advance, within 15 (fifteen) Calendar Days, after fulfilling the following

formalities by the Contractor:

a) Signing of the Contract Agreement by the Contractor;

b) Submission of the Contract Performance Bank Guarantee; and

c) Submission of the Mobilization Advance Guarantee.

ii. Second Instalment

Balance 5% (five percent) as follows (or other specific conditions on case to case

basis)

a) After the Contractor has constructed a site office, storage shed, fabrication yard,

etc. and has physically mobilized construction equipment and is ready to start the

Works to the entire satisfaction of the Engineer-in-Charge or linked to the progress

of work if so indicated in Special Conditions of Contract

b) Submission of Mobilization Advance Guarantee. This will keep check on contractor

utilizing the full mobilization advance when the work is delayed considerably.

Recovery of Mobilization Advance

Recoveries will be effected from each Running Account Bill at the rate of 10% of

the gross bill value, till the entire Mobilization Advance (Together with interest

accrued thereon) is fully recovered. In any Case, mobilization advance shall be fully

recovered before release of Payment due towards Mechanical completion/ pre-final

bill.


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20.22 DIRECT PAYMENTS TO SUB-VENDORS / SUPPORTING AGENCIES OF MAIN

CONTRACTOR

Normally, the payment is to be made to vendor/contractor only as per provision of

contract. During execution, in case of financial constraints, PLL may make direct

payment to their sub-vendor / supporting agencies as an exception from the

amounts due to the vendors/contractors from any of their bills under process upon

certification by EIC subject to receipt of such request from the vendor/contractor.

Further, the request for direct payments to the sub-vendor / sub-contractor shall be

considered in performance evaluation of such vendor/ contractor.

The prior approval for release of direct payment to sub-vendor / supporting agencies

as mentioned above to be obtained from the Competent Authority (under whose

delegation of power the award of Main/original contract would fall). In case where

Competent Authority is Director and above, the approval of Director concerned shall

be obtained.

20.23 ZERO DEVIATION BID

Zero deviation bid will be incorporated in case of limited tendering. While same can

be preferably incorporated in open tendering also. However, the competent

authority may waive the requirement of zero deviation bid in case of open tendering.

21. INTEGRITY PACT

PLL as one of its endeavour to maintain and foster most ethical and corruption free

business environment, have decided to adopt the Integrity Pact to ensure that all

activities and transactions between the Company (PLL) and its Counterparties

(Bidders, Contractors, Vendors, Suppliers, Service Providers/Consultants etc.) are

handled in a fair and transparent manner, completely free of corruption.

Considering the above, the copy of the Integrity Pact at Appendix - XI shall be

included in the Bid submitted by the bidder (to be executed by the bidder for all

tenders of value Rs. 15 (Fifteen) crore and above). In case a bidder does not sign

the Integrity Pact, his bid shall be liable for rejection.


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22. EVALUATION OF BIDS

22.1. EVALUATION OF BIDS UNDER SINGLE BID / SINGLE ENVELOPE

In case of composite bids price and technical part comes together and prices of all

bidders are known on the date of opening. It is not preferred to raise technical and

commercial queries to the Bidders and the bids should be evaluated as submitted.

However, if unavoidable clarification may be sought where ever necessary, without

affecting the quoted price.

22.2. EVALUATION OF BID UNDER TWO BID / ENVELOPE SYSTEM

22.2.1. The Techno commercial unpriced bid shall be opened first and scrutinised by user

department for meeting the technical requirement. As a process for preparing the

Technical Bid Analysis (TBA) the user department shall examine and check for

compliance to Bid evaluation criteria and other technical requirement of the tender

document.

If necessary the user department shall prepare technical queries and forward the

same to C&P department for seeking clarification from the Bidders.

Likewise C&P department after opening the Bid shall commercially evaluate the

offer for compliance of tender document in consultation with finance department. If

necessary C&P department shall prepare commercial queries.

22.2.2. The Indentor / C&P department shall forward to bidders, the Technical and

commercial queries seeking clarification from the Bidders. On receipt of reply from

the bidders against technical and commercial queries, response to the technical

part shall be forward to user department who will prepare the technical Bid analysis.

The technical Bid analysis shall clearly indicate the technical acceptability of a bid.

In case a Bid is technically not accepted the reason thereof shall be clearly

mentioned.

The C&P department shall simultaneously prepare Commercial Bid Analysis (CBA)

which shall be vetted by finance department.

22.2.3. Once the Technical and commercial evaluation is complete, the Tender Committee

(TC) shall put up recommendation for price Bid opening of techno commercial

acceptable bid(s) for approval of competent authority. Tender Committee shall also

deliberate about the reasons for rejection of bids if any. The bidders whose price


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Bids are acceptable for price bid opening, shall be notified the date of price Bid

opening so that Bidders may attend price bid opening if they so desire.

22.2.4. The Price Bid of the qualified Bidder shall be evaluated strictly as per the provision

of Tender document to know the inter-se ranking of the Bids.

22.2.5. Wherever there is engagement of Project Management Consultant (PMC) who are

responsible for technical aspect as well as procurement, the Technical Bid analysis

and commercial Bid analysis shall be provided by the consultant along with the

recommendation for award.

22.2.6. The Tender committee consisting the members from Indentor, C&P and Finance

shall make final recommendation based on the Technical / Commercial Bid analysis

or recommendation by PMC for approval of Competent Authority as per DoA for

award.

22.3. CONDITIONAL & UNSOLICITED DISCOUNT

Conditional and unsolicited discount will not be considered in evaluation. However,

if such bidder happens to be the lowest recommended bidder, unsolicited discount

without any condition will be considered for computing the contract price.

22.4. CLARIFICATION FROM BIDDERS AFTER TENDER OPENING

As a principle the Bid shall be evaluated based on the information, details,

documents etc. submitted by Bidder without resorting to any communication with

the bidder. However during the process of evaluation there may be necessity to

have clarification from the bidder as mentioned here under:

22.5. COMPOSITE BID (TECHNICAL AND PRICE)

In case of Single Bid system where the price as well as technical part is in one

envelope the procurement should be finalized invariably without any technical /

commercial queries, however if any query becomes unavoidable the same may be

raised with the approval of competent authority provided it does not changes the

substance of the original submission.

22.6. TWO BID SYSTEM

22.6.1. During the Techno Commercial evaluation of the Bids if it is considered necessary

to seek clarification from Bidders in relation to their original submission, Technical


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and commercial queries if any shall be raised to the bidders giving a reasonable

time to respond, such clarification from bidder should not change the substance of

the original submission.

22.6.2. While seeking clarification from the bidders, it should not be pick and choose and

wherever required against any bidder, the clarification should be sought from such

bidders. Any subsequent query can be issued only after the tender committee

deliberates and considers it necessary for taking proper clarification.

22.6.3. While seeking clarification from bidder and giving a reasonable time to respond a

cut-off date should be indicated with the stipulation that in case no response is

received from the Bidder his bids will be evaluated based on the available

information as per bid submission.

22.6.4. In OEM cases, bidder can be asked to withdraw the exceptions and deviations

taken by them to PLL’s standard terms and conditions by the dealing officer in C&P

department.

22.6.5. Post Tender Bid Modification is not permitted.

22.7. CORRESPONDENCE WITH BIDDERS

Before finalisation of the tender, all correspondence with the bidders should be done

by C&P department. However, after placing supply order / contract, the Indentor

shall interact with supplier(s) / contractor(s) in respect of the execution of the order

/ contract.

22.8. COMPARISON OF BIDS

Comparison will be made amongst various bidders in the following manner when

tenders have been invited on ICB basis with provisions clearly stipulated in the

tender documents, where Domestic and Foreign Offers Exists.

Ex-works price of domestic bidder (with Customs Duty, IGST on imported raw

materials and components, etc. and applicable GST on finished products) including

inland transportation and transit insurance to owner’s site.

and

CIF (Cost, Insurance and Freight) landed price of foreign bidder which includes

(Cost and Freight price, applicable IGST, Marine Insurance, Landing charges plus

applicable customs duty) including inland transportation and transit Insurance to

owner's site shall be compared.


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22.9. GUIDELINES FOR SCRUTINY / COMPARISON OF BIDS

The discrepancies in rate filled for various items shall be resolved in the following

manner:-

(i) When there is a difference between the rates in figures and words, the rate which

corresponds to the amount worked out by the Bidder (by multiplying the quantity

and rate) shall be taken as correct.

(ii) When the rate quoted by the contractor in figures and words tallies but the amount

is incorrect, the rate quoted by the Bidder shall be taken as correct and not the

amount and the amount corrected.

(iii) When it is not possible to ascertain the correct rate, in the manner prescribed above,

the rate as quoted in words shall be adopted and the amount worked out, for

comparison purposes.

(iv) In case it is observed that any Bidder has not quoted for any item in the schedule

of rates (such unquoted item not being in large numbers), the quoted price for the

purpose of evaluation shall be considered as the maximum rate quoted by the

remaining bidder for such items.

If after evaluation, such bidder is found to be the lowest evaluated bidder, the rates

for the missing item shall be considered as included in quoted bid price.

If the estimated price impact of the unquoted items is more than 10% of the bidder’s

quoted price, the above provision shall not be applicable and such bid shall be

rejected.

Note: The above provision should invariably be made a part of tender document.

Further, in case of SAP generated schedule of rates / where manual pricing is

sought, the following provision should be included:

“Rates should be quoted both in figures as well as in words by the bidders “.

22.9.1. If any unconditional rebate has been offered in the quoted rates, the same shall be

considered in arriving at the net tendered amount. No cognizance shall be taken for


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any conditional discount for the purpose of evaluation of the bids.

22.9.2. After the total quoted amount for each tender has been worked out, the financial

implications in respect of the retained technical and commercial deviation will be

added for evaluation purpose as per terms and conditions declared upfront in the

tender documents.

22.9.3. If any bidder offers suo-moto discount after opening of un-priced bids but before

opening of price bids, such reduction / discounts shall not be considered for

evaluation. However, if the bidder happens to be the lowest evaluated bidder

without considering such discount then the benefit of discount will be availed at the

time of award of work. In the event as a result of techno-commercial discussions or

pursuant to seeking clarifications / confirmations from bidders, while evaluating the

un-priced part of the bid, any of the bidders submits a sealed envelope stating that

it contains revised prices; such bidder(s) will be requested to withdraw the revised

prices failing which the bid will not be considered for further evaluation. Such a

stipulation should clearly be indicated in the tender document.

22.9.4. As far as possible only firm prices shall be accepted. However, in case of tenders,

completion period is for more than one year, escalation clause may be accepted

subject to an overall ceiling as a percentage amount. Loading shall be done where

such escalation is requested by a bidder upto the limit of ceiling quoted by him.

Depending upon the nature of work, if considered appropriate a price variation

clause on account of certain inputs may be provided in the tender document linked

with National/International indices for which bidder is required to quote ceiling if he

desire to opt such clause. A bid with price variation clause without ceiling shall be

rejected.

22.9.5. The evaluated price of each of the bidders whose price part have been opened by

adding the loading amount to the tendered / quoted price, shall be recommended

for award on lowest evaluated bid basis.

22.9.6.

A. Work centre/Project is entitled to avail Tax Credit of GST (CGST & SGST/UTGST

or IGST) and there is certainty at the time of bid evaluation about the quantum of

input tax credit available for the tendered items/services/ works:


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The input credit of GST (CGST & SGST/UTGST or IGST) shall be considered for

evaluation of bids.

B. Work Centre/Project cannot avail/take the credit of GST (CGST & SGST/UTGST or

IGST) or there is uncertainty at the time of bid evaluation about the quantum of input

tax credit available for the tendered items/services/ works:

The bids will be evaluated based on total price including applicable GST (CGST &

SGST/ UTGST or IGST).

C. In case any unregistered bidder is submitting their bid, their prices will be loaded

with applicable GST (CGST & SGST/UTGST or IGST), if applicable as per Govt.

guidelines, during evaluation of bid. Where PLL is entitled for input credit of GST

(CGST & SGST/UTGST or IGST), the same will be considered during evaluation

as per evaluation methodology of tender document.

D. In case any cess on GST is applicable same shall also be considered in evaluation.

E. For Procurement of Goods: In case the bidder is covered under Composition

Scheme under GST laws, then bidder should quote the price inclusive of the GST

(CGST & SGST/UTGST or IGST). Further, such bidder should mention “Cover

under composition system” in column for GST (CGST & SGST/UTGST or IGST) of

price schedule.

23. TENDERS NOT IN PRESCRIBED FORMS

23.1. If quotation are received from a registered or otherwise well- known firm in their own

letter form instead of on the prescribed Tender form, against an advertised or limited

tender, such quotations shall be considered for evaluation, if they are received in

time as long as such bid meets all technical, commercial criteria specially the

specification/ scope or work and does not have any problem in execution of the

contract in terms of measurement and invoicing.

23.2. BIDS FROM INDIAN AGENTS OF FOREIGN PRINCIPALS

Bids from only foreign suppliers / Manufactures are acceptable and offers from the

Indian Agents of foreign Principals/ suppliers / manufactures are not permitted. A

stipulation to this effect must be incorporated in all ICB tenders.


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23.3. PARTICIPATION OF CONSULTANTS IN TENDERS

Appointment of Consultants for preparation for projects report for any new projects,

expansions, modernization / modification of the existing projects etc. should be

done with maximum attention to the suitability, competence and proven track

record.

A consultant firm which has been engaged by the PLL to provide goods or works

(except feasibility report) for a project and any of its affiliates will be disqualified

from providing consulting services for the same project. Conversely, a firm hired to

provide consulting services for the preparation or implementation of a project and

any of its affiliates, will be services related to the initial assignment for the same

project.

Consultant or any or their affiliates will not be hired for any assignment which by its

nature may be in conflict with another assignment of the consultant.

23.4. TENDERS NOT CONFORMING TO SPECIFICATIONS

a) Tenders which do not confirms to the specifications are to be ignored straightaway.

Lowest tender may be determined from amongst those tenders which are in full

conformity with the specification.

b) ACCEPTANCE OF MATERIALS IN DEVIATION TO SPECIFIED

SPECIFICATIONS

Normally material with deviation from requisite specifications will not be accepted.

However, in exceptional circumstances, material under deviation in specification

may be accepted on the recommendation of user/ indenting department with the

confirmation of F&A. Such deviation in scope and specification shall be considered

by Indentor without compromising with performance of the material / equipment /

works. The requisite reduction in the contracted rates is to be effected as

determined and adequacy of the same is to be certified by the Indentor. Such

deviation and reduction in rates requires approval of one level above the competent

authority. Where ever the Competent Authority is Director and above, approval of

Director will suffice.

24. LATE BID / SUBMISSION OF TENDERS SAMPLES AFTER OPENING OF

TENDERS/ UNSOLICITED BIDS OR BIDS BEING SUBMITTED TO ADDRESS

OTHER THAN THE ONE SPECIFICALLY STIPULATED IN TENDER


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DOCUMENT.

i. All Tenders received after the notified time and date of closing of tenders will be

treated as late tenders.

ii. Unsolicited alteration or modification of tenders received after the notified time and

date of closing of the tenders shall not be entertained.

iii. Late tender, as defined in para (i) above, shall not be considered, such late tenders

may be recorded in the register maintained for this purpose and returned to the

Bidder within 10 days in “unopened condition”. The Bid bond of such Bidders shall

be returned along with the unopened bid. In case of e- tendering where bid bond is

received but bid is not submitted by the Bidder, such bid bond shall be returned

immediately.

Unsolicited Bids or bids being submitted to address other than the one specifically

stipulated in the tender documents will not be considered for evaluation if not

received to the specified destination within stipulated date and time.

25. BID WITHDRAWAL

In case Bidder withdraw its Bid within Bid validity period after passage of due date

for Bid submission, Bid security shall be forfeited and such party should be

considered for putting on holiday with due process as per guideline.

26. FURNISHING FRAUDULENT INFORMATION / DOCUMENT

If it is found during the evaluation of the tender that a Bidder has furnished

fraudulent document / information, the Bid security shall be forfeited and such party

should be considered for putting on holiday with due process as per guideline.

27. ACCEPTANCE OF RECOMMENDATION OF TENDER COMMITTEE:

27.1. Tender Committee Recommendations will be put up directly for approval of the

Competent Purchase Authority as per the DoA in vogue without routing through the

intermediary(ies). Comments/Observations/Directions by any other person

including staff officers of Director/C&MD on such recommendation are not allowed.

27.2. Competent authority can either approve the recommendation of tender committee

or give written directives to TC for reconsideration of its recommendation with

specific observation.

27.3. When the recommendation of tender committee is unanimous, and the competent

purchase authority does not agree with recommendation, he/she will refer the case


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for a decision to the next higher competent authority along with his / her

recommendation and giving reason for not agreeing with TC recommendation.

27.4. In case there is dissenting view in the tender committee recommendation, the

Competent Purchase authority will be empowered to accept the majority

recommendation of the tender committee. If the majority recommendation of TC is

not acceptable, the competent purchase authority with his views along with his

recommendation shall refer the matter to next higher Competent Purchase

Authority, empowered to take decision and approve the majority recommendation.

27.5. In cases where there is recorded difference of opinion amongst the tender

committee members and there is no majority view within the tender committee, the

matter shall be put up to the competent purchase authority for decision.

28. BID REJECTION CRITERIA

The Bids submitted by Bidder shall be liable to be outright rejected if Bidder take

deviations to the following stipulation:

I. Compliance with requirement of submission of Performance bank guarantee/

security deposit.

II. Non provision of Guarantee / Warrantee of equipment / material supplied / work

executed.

III. Prices subject to escalation without a ceiling.

IV. Submission of forged and misleading information

29. RULES FOR PLACEMENT OF ORDER

29.1. Normally the order shall be placed on the; lowest evaluated Techno commercially

acceptable Bidder.

29.2. If the Bidder does not comply with Tender stipulations (specifications and critical

stipulations which are already specified in Bid Documents), his tender shall not be

accepted and such a Bid shall not be considered for placement of order.

In case after price bid opening the lowest evaluated Bidder (L1) is not awarded the

job for any mistake committed by him in Bidding or Withdrawal of Bid or varying any

term in regard thereof leading to re- tendering, PLL shall forfeit Earnest Money paid

by the Bidder and such Bidder shall be debarred from participation in Re- Tendering

of same job(s)/ item(s).

Where two -envelope system is followed, it may be ensured that all bidders are


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brought on common footing in technical and commercials bid and thereafter on price

bid should be opened and the work awarded to lowest Bidder.

30. STANDARD FORM OF CONTRACT/ SUPPLY ORDERS

30.1. All contracts should normally be entered into on the standard form prescribed for

making procurement for the company, except where existing clauses are to be

modified or special clauses added for compliance by the supplier/ contractor.

30.2. PURCHASE OF MACHINERY AND EQUIPMENT

When deciding orders for the procurement of "Machinery and Equipment” on

indigenous cases it has to be ensured that orders are placed only on the

manufactures or their authorized dealers licensed by the Government for production

under the Industries Development and Regulation Act of 1951.

30.3. ADJUSTMENT OF SUPPLY ORDER

i. Adjustment in indented / ordered quantity to match standard packing offered by

vendor or to facilitate logistics may be considered, provided the difference in cost is

not significant. In such cases, indenter may be asked to review the indented /

ordered quantity and seek requisite approval for such variation provided shelf life of

product remains.

ii. Where nature of items is such where the items cannot be supplied in exact quantity

on order as in the case of cables / steel/ chemical etc., quantity tolerance up to +-

5% may be allowed. For such tolerance separate amendment to purchase order is

not necessary.

Decision for the purchase of equipment should be taken so that it could prove to be

more economical in the long run. Therefore, while evaluating the offers for purchase

of capital equipments the cost of maintenance spares subsequently required over

the estimated life span of the equipment will also be taken into consideration where

it plays a significant role.

31. SPLITTING OF TENDERS/SUPPLY ORDER

31.1. While the tender are generally considered on an item-wise basis and the practice

is to split these items where necessary and award the contract to the lowest

acceptable bidder on an itemised basis, it is not necessary to split up where the

monetary gain in splitting the tender for award is not commensurate with the


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additional ordering/inspection costs, etc is not more than Rs. 5000/-.

31.2. Items in a tender may be split up in more than one order depending on the item of

each case keeping in view the operational needs. Tender for part of items may be

finalised with the approval of competent purchase authority for complete tender. For

finalization of tender for the remaining items, the case will be submitted to the

competent purchase authority for complete tender reflecting therein the facts that

tender for part items in that case had already been finalised.

32. SPLITTING OF QUANTITIES

32.1. The cases for critical services/supply where more than one source is required, the

same should be pre-disclosed in the tender including the ratio of order quantity such

as 70:30 or 60:20:20 and L2, L3… is to get order only after matching L1 price. The

ratio should be such that L1 bidder should get larger quantity compared to L2, L3…

the above exercise shall not be considered as negotiations. In case L2, L3 ….. does

not match it prices the remaining quantity is to be re-tendered following the normal

tendering procedure.

32.2. In such cases of tendering where splitting is pre-defined, Bid Eligibility Criteria shall

be fixed considering maximum percentage that can be ordered on a single Bidder.

32.3. The cases where entire work is divided into more than one part and tender has

provision for evaluation and award of the job part wise the entire work shall be

finalized on least cost to PLL, if a bidder happens to be lowest in more than one of

the parts and has qualified only for one or more than one of the parts and not all

parts, as the case may be. Once certain part(s) awarded to such L1 bidder, the

bidder ceases to be lowest bidder for the remaining part(s). the award of remaining

part(s) on other bidders should not be considered as award on L2,L3 … bidder.

32.4. Counter- offers to L1, in order to arrive at an acceptable price, shall tantamount to

negotiations.

In case L1 Backs-out, there should be a re-tender.

33. INSUFFICIENT ACCEPTABLE BIDS

33.1. In case after inviting open/ limited tenders, less than three techno commercial

acceptable offers are found, the order should be placed on lower of the two or the

single acceptable bidder as per DoA provided at least one of the following

conditions are met :


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I. The rates are considered reasonable,

II. The requirement is urgent,

III. The sources are really limited,

While forwarding the recommendation for award to the competent authority the

applicable situation as per above may be clearly mentioned in the recommendation.

33.2. The reasonableness of the rate shall be confirmed by the group who has done the

cost estimate. The urgency of the requirement would be certified by the user

department. As regards limitation of sources the same shall be commented upon

by User.

34. THE REASONABILITY OF PRICE

34.1. When minimum three acceptable bids have been received against competitive

bidding process, the bids should be processed for award of Contract on lowest (L1)

bidder. However, the lowest price should be compared with the estimate, if

necessary the estimate should be reviewed and reasonability of the price be

examined before recommendation for award.

34.2. If the price of the lowest bidder is higher than 10% of the estimate, the estimate

should be exhaustively reviewed in order to enable the decision making process for

the award. Such review of the cost estimate shall be done by the Indentor. The

Indentor shall also obtain addition sanction for increased amount. The Project

schedule and the operational requirement shall also be kept in view while taking the

decision.

34.3. PRICES LOWER THAN THE ESTIMATE

In case the quoted price of the lowest (L1) bidder is lower than 70% of the estimate,

the in house estimate needs to be revisited. The bidder should be asked to explain

as to how he proposes to execute the Contract. This discussion shall be conducted

by the Tender Committee with the bidder. If the Tender committee is satisfied it may

recommend for placement of order on the lowest (L1) bidder.

In case the Tender Committee is not satisfied and it opines that quoted prices are

so low that the job cannot be executed; the TC may recommend for cancelation of

tender and re-tendering. Such lowest bidder shall not be allowed to quote in the

fresh bidding.


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35. NEGOTIATIONS

As a principle negotiations should be avoided. The Bidders in the market should

carry an impression that this buyer generally don’t go for negotiation, this shall

enable to quote their best prices without having any margin for negotiation.

However, under exceptional situations the negotiations can be held only with L1

Bidder. Prior approval of the competent authority / Director for the cases where

competent authority is Director and above should be obtained for negotiation. The

exceptional situations may include the following:

I. Procurement of Proprietary items

II. Items with limited source of supply

III. Suspicion of cartelisation

IV. The requirement is urgent and price of lowest bidder is unreasonably high

V. Procurement on nomination basis if quoted price are considered high

The tender committee after due deliberation shall recommend for price negotiation

for approval by competent authority.

The negotiation shall be carried out by the tender committee. During the negotiation

the Tender committee may seek the justification of quoted price along with the

breakup. The tender committee should keep in view the internal cost estimate while

negotiating the prices. All efforts should be made by the committee to bring down

the price to a reasonable level.

Negotiations should not be misused as a tool for bargaining with L-1 bidder which

may lead to delays in decision-making. Convincing reasons must be recorded by

the Tender Committee recommending negotiations. Competent Purchase Authority

should exercise due diligence while accepting a tender or ordering negotiations or

calling for a re-tender.

In cases where a decision is taken to go for re-tendering due to the

unreasonableness of the quoted rates, but the requirements are urgent and a re-

tender for the entire requirement would delay the availability of the item, thus

jeopardizing the essential operations, maintenance and safety, negotiations would

be permitted with L-1 bidder(s) for the supply / services of a bare minimum

quantity/period, subject to acceptance by the bidder. The balance quantity should,

however, be procured expeditiously through a re-tender, following the normal

tendering process.


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36. ISSUING LETTER OF ACCEPTANCE / LETTER OF INTENT / PURCHASE /

WORK ORDERS

36.1. After approval of the Competent Purchase Authority (CPA), the successful bidder

shall be promptly issued a communication by Fax / Email / letter conveying

acceptance of his tender giving reference of correspondence exchanged with

particular reference to the letters wherein the successful bidder had

confirmed acceptance of and compliance with tender stipulations. Such letter of

acceptance shall also include the order value, time schedule / delivery period for

supply and other important requirements the Supplier / Contractor is required to full-

fill after acceptance of the offer.

36.2. The letter of acceptance may be followed by detailed letter of award / Purchase

order which shall contain scope of work / specification / delivery / completion

schedule / contract price and all other relevant condition based on tender / offer and

subsequent agreed variation if any.

36.3. In case of procurement of goods / equipment following information may also be

provided in Purchase order:

i. Purchase order reference

ii. Consignee

iii. Date of delivery

iv. Place of delivery

v. Despatch instruments

vi. Packing Instructions

vii. Inspection & Tests to be conducted at various stages

viii. Place at which inspection shall be carried out and name of the Inspection agency

ix. Mode of transport

x. Insurance instruction

37. PRICE REDUCTION SCHEDULE ( PRS)

i. Price Reduction @ 0.5 % of the total order / contract value per week for delay in

supply / completion of work subject to a maximum (ceiling) of 5% of total order value

will be applicable for order for supply, works and turnkey projects and services

contracts. However, on exceptional circumstances, tender committee may


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recommend different weekly percentage which needs to be approved by competent

Authority before incorporation in the tender document.

ii. In a contract, the portion of supply completed in all respect which is being used for

commercial operation shall not be considered for applying Liquidated damages, if

delivered within contractual delivery period. The remaining supplies which are

completed beyond the contractual delivery period shall attract Price Reduction @

0.5% of the value of the delayed delivery maximum upto 5% of the total order value.

However, on exceptional circumstances, tender committee may recommend

different weekly percentage which needs to be approved by competent Authority

before incorporation in the tender document.

iii. No Price Reduction clause will be inserted in contracts / supply order for purchase

upto Rs. 7 Lakh. For other contracts PRS should be made applicable.

For OEM purchases, OEM services, Proprietary chemicals and other articles of

proprietary, PRS should not be used.

iv. Price Reduction schedule clause may not be applicable for Consultant e.g. in case

of appointment of rating agency, auditors and cases where the performance of the

consultant depends to a large extent on the information, details and regular

feedback to be given back by PLL to the Consultant to complete the assignment

etc.

v. The following may be added in Price Basis/Contract Value clause of PO/LOA:

“The Order/ contract value mentioned above is subject to Price Reduction Schedule

clause.”

38. CANCELLATION / RE-INVITATION OF TENDERS

38.1. CANCELLATION OF TENDERS

A tender where Bids has been invited should ideally be result into a contract.

However in exceptional situation there may be need to cancel the ongoing tender.

There have to be valid reasons for cancellation of a tender. The cancellation of a

Tender shall be with approval of competent authority on recommendation of Tender

committee. The cases falling under power of director and above shall have approval

of concerned director for cancellation.

In case if L1 Bidder back out, there should be a re-tender.


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38.2. RE-INVITATION

38.2.1. In the event of re-invitation of bids whether on a limited or open tender basis, the

approval will be obtained from the Authority one level higher than the CPA. In

respect of proposals falling under the purview of Director and above, the concerned

Director will have final authority. Reasons for re-invitation of tenders in all such

cases will be recorded. Such re-invitation intimation will be sent to all the bidders

who quoted against the original tender.

38.2.2. In the event, the response against original enquiry was less, new names shall be

added with the approval from the Competent Authority. Where competent authority

is Director and above, approval of Director concerned will be adequate for addition

of new names and tender re-issuance.

39. E-TENDERING

39.1. E-tendering may be done for tenders having estimated value of Rs. 10.00 Lakhs

and above. Tender document is to be uploaded on PLL’s E-tender Portal and

Bidders shall submit the bids electronically through PLL’s E-tender portal only. Bid

submitted manually shall not be accepted. Bidders are required to upload the copies

of EMD / Bid Bond / BG on the E- Portal. The original Bid bond / EMD, shall be

submitted in physical form on or before the due date of submission.

Power of attorney of signatory or any specific third party document required in

Originals shall be submitted physically.

39.2. The purchase requisition (Indent) for e-procurement tender should flow

automatically from SAP system. The process for approval of BECs, etc. shall be as

per existing process. After due approval all related document shall be uploaded in

the system by the dealing officer. Thereafter the dealing officer will prepare the

tender document and upload the same after affixing digital signature.

39.3. For submitting the bids, the Bidders shall also require to obtain digital signature

from authorized agency.

39.4. For e-procurement tenders, the tender fee shall not be applicable

39.5. In the Invitation to Bid published on the website, the name, designation and e-mail

address of the designated Dealing Officer who is to be contacted by bidders, as

nominated by PLL for the particular tender, should be indicated.


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39.6. EVALUATION AND AWARD

39.6.1. The Bids submitted by the Bidders shall be downloaded from the system. The

Technical and commercial; evaluation for determining the Techno commercial

acceptable Bid shall be carried out manually. The TBA (Technical Bid Analysis) and

TBA (Technical Bid Analysis) shall be manually prepared.

39.6.2. The Price Bid of the techno commercial acceptable bidder shall be opened as per

procedure. The price evaluation which may include certain loading shall also be

done manually to decide the inter-se ranking of the bidders as per tender conditions.

39.6.3. In case of procurement for standard items where evaluation for technical &

commercial acceptability is not required and the price is main criteria, the

comparison of prices to decide inter-se ranking may be done through the electronic

system

39.6.4. After finalization of tender, the purchase orders shall be issued through SAP.

39.7. All cases for procurement of materials / services / Works through Board purchases

shall be exempted from e-procurement.

40. ELECTRONIC REVERSE AUCTION

40.1 REVERSE AUCTION**

Reverse Auction is a procurement tool to obtain competitive price through multi

bidding online negotiating amongst short-listed bidders. Through this process, the

short listed bidders get an opportunity to reduce their prices online in a transparent

and fair manner based on the evaluation methodology stipulated in tender

document without the identity of bidders being disclosed either to other bidders or

to officials of PLL. The entire process is designed to bring a complete transparency

in the process as under:

i. Minimizes human involvement.

ii. System offers greater insights into the current market prices.

iii. Gives equal opportunity to all short listed Bidders to be most competitive.

iv. Help bidders to know respective price / position dynamically vis-a-vis the other

bidders and provide them an opportunity to react to it.

Reverse Auction shall be applicable in case of procurement of Bunker Fuel andDocument downloaded on 09-04-2022 07:07:28 by

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procurement cases above INR 5 Cr. or for any other cases as approved by director

concerned. However, Reverse Auction Shall not be applicable in case of EPC

Contract. If Reverse Auction not to be done for any cases, then the same shall be

approved by Concerned Director. **(Refer MANUAL/AMENDMENT/01 dated 9th May 2020)

40.2 TENDER FOR REVERSE AUCTION

The tender where reverse auction is to be conducted should have the stipulation

about the same. Before conducting the reverse auction the Bidders shall be

informed about time and date of reverse auction.

40.3 INSUFFICIENT PARTICIPATION IN REVERSE AUCTION

The reverse auction shall be carried out in the cases where the acceptable bids are

more than one. In case of single acceptable bids the offer shall be processed for

award as per guidelines provided in the procedure keeping in view insufficient

participation.

40.4 REVERSE AUCTION

The reverse auction may be conducted with Rank with L-1 price. The applicable

exchange rate for conversion and applicable custom duty to be loaded (in case of

foreign Bidders) and price basis for evaluation (in case of domestic bidders) like ex

works, FOT shall be conveyed to bidders prior to reverse auction. The loading factor

for each techno commercial acceptable bidder should be worked out and

communicated to respective bidder.

After opening the price bid the Bid shall be evaluated for each Bidder to arrive at

evaluated price. The evaluated price of respective Bidder shall be uploaded in the

system which shall be the sealing price for respective Bidder.

40.5 FEATURES OF ONLINE EVENT

I. The online reverse auction will be conducted through online bidding software.

II. The Bidder cannot increase its price the bidders can only reduce by permissible

decrement or its multiples.

III. During reverse auction the bidder shall reduce its last price by minimum 0.1% (or

any other value as the case may be) of its last price.


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IV. The bidder shall see the lowest bid and their own numeric rank.

40.6 TIMINGS AND DURATION OF ONLINE REVERSE AUCTION

I. All timings of online Bid shall be based on time indicated by server hosting the

auction, which should be Indian standard time. The Bidder should be advised to

refresh the window of the auction module and check the server time.

II. The process of online reverse auction shall initially be held for a period of 30

minutes. In the event of a bid received in the last 3 minutes resulting in a change of

prevailing L1 price, the period of auction shall get extended automatically by 5

minutes from the time of submission of such bid. This process will continue till no

change in L-1 price place in last 3 minutes. Then the auction will close.

III. All Bidders, regardless of their previous position, can submit their bid in extended

period also.

IV. The identity of the Bidders shall not be disclosed to tender committee and dealing

officers during reverse auction.

V. In order to maintain the sanity, unauthorised communication shall not be allowed

during reverse auction. A landline phone shall be available during the reverse

auction for any urgent authorised communication with the Bidder. The number of

such telephone shall be communicated to bidders well in advance. The contact

number of all the Bidders shall be available with the dealing officer and Tender

committee during the reverse auction.

VI. In case of tie during the reverse auction i.e. two Bidders entering the same lowest

price, the Bidder who enters the price first in the system will be considered as L-1

and the other bidder will be L-2.

VII. On the completion of reverse auction the history of online reverse auction shall be

signed by the dealing officer and the Tender committee members.

VIII. Bidder at their own interest should ensure uninterrupted internet connectivity at their

end during the reverse auctions. However, in case of failure in connectivity of any

of the bidders, the reserve auction time shall be extended once against request of

each bidder if the request is received within the auction time. Such extensions shall

each be of 10 minutes and no more than one request for such extension from a


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bidder shall be entertained in an auction. The extension of auction time shall be

communicated to all the bidders through system broadcast message and also

intimated telephonically to the bidders who are disconnected from reverse auction

at that point of time.

IX. The tender which has stipulation for such auction shall be mandatory for the bidders

to confirm participation in reserve auction. In case any such bidder does not

participate in reserve auction his bid shall be rejected and EMD shall be encashed.

A bidder while participating in the auction may or may not reduce his original price,

however, he should participate in auction.

X. At the end of the reserve auction proposal may be processed for award on L1 price.

However, the price reasonability of final needs to be established.

41. COMPLAINTS / REPRESENTATION-CONSIDERATION

a) Anonymous representations received should be ignored. If a proper representation

is received when a proposal is under consideration of the tender committee, then

the same should be commented upon by the tender committee in its

recommendations.

b) Any complaint or representation received after finalisation of the case should be

examined and dealt with suitably so that corrective action, if any, should be taken

in future.

42. LEAD TIME IN PROCESSING OF PR/SR AND MONITORING THEREOF

42.1. Normally the time taken to process various type of enquiries for procurement of

materials, works and services shall be as per time schedule allowed in the

procedure.

42.2. It should be the endeavour of all concerned to achieve the target at all stages so

that placement of orders is not delayed.

42.3. The progress achieved will be entered in the format enclosed as Annexure I to

Annexure IV as applicable. These activities should be preferably be placed on

computers for ease of availability of information whenever need arises.

43. DEVIATION TO THE MANUAL

During the course of executing the projects / operation of plant there may be a

situation where it becomes necessary to deviate from this manual in order to meet


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the organizational need. Such deviations shall be approved by the Concerned

Director.

44. AMENDMENT TO THE MANUAL

The manual may require modification / amendment with the passage of time due to

certain changes in policy and business requirement of the company. If the need for

amendment of manual in certain area is felt by any department / business centre

the same shall be forwarded to C&P department at corporate office. The C&P

department shall examine and if considered essential a proposal shall be moved

for approval by MD & CEO on recommendation of concerned Director with

concurrence of Director Finance.

However the C&P manual will be holistically reviewed every 5 (five) years by the

Board.


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SECTION-III

GUIDELINE FOR POST AWARD MANAGEMENT OF

CONTRACTS/PURCHASE ORDER

1. GUIDELINE FOR POST AWARD ACTIVITIES

Once the letter of Acceptance (LOA) has been released in accordance with the

tender conditions / bid and agreed variations, the following activities shall be under

taken;

1.1 ISSUANCE OF DETAILED CONTRACT / PURCHASE ORDER

A detailed contract / purchase order shall be prepared comprising of the scope of

work, specifications, scope of supply, delivery schedule, payment terms, Schedules

of Rates, the other relevant conditions of the contract etc. as provided in the tender

document, agreed deviations if any. The detailed work order shall be placed within

7 days of issuance of LOI. The Vendor/ Contractor shall provide acknowledgement

of receipt of work order with 7 working days.

1.2 PERFORMANCE BANK GUARANTEE / SECURITY DEPOSIT

The follow up action shall be taken by C&P department in order to obtain PBG /

Security deposit with in time as specified in the tender document.

In case there is a delay in submission of PBG, matter should be taken up promptly

and there should be monitoring of EMD submitted by Bidder so that if the need be,

seek the validity extension of EMD or en-cash the EMD.

1.3 SIGNING OF THE AGREEMENT

Agreement shall be signed at the earliest after submission of the PBG. The contract

agreement should be signed on Non-judicial stamp papers of values as applicable

as per Stamp Duty Act of the State in which the contract is finalized.

1.4 FOLLOW-UP

After the order is issued, the concerned C&P officer shall expedite for obtaining

acceptance of purchase order / signing of contract and receipt of contract

performance guarantee / security deposit.

Expediting the supplies / works / services suppliers will be done by the group

involved by C&P department wherever applicable.


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1.5 MANAGEMENT OF SECURITY DEPOSIT (SD) / PERFORMANCE BANK

GUARANTEE (PBG) AND CLAIM SETTLEMENT (IF ANY)

The Performance Bank Guarantee shall be used or released as per the provision

of contract / Purchase order.

1.5.1. All concern shall ensure that details of any claim to be recovered from supplier /

contractor is promptly reported to paying authority so that claim is recovered before

releasing the pending payment.

1.5.2. Details of such claims shall be intimated to dealing purchase officer who has concluded

the contract. After completion of supply / execution of contract following actions needs

to be taken:

a) In case of supply of goods, for recovery of any claim the details of the same to be

intimated to the dealing purchase officer by consignee who shall take up the matter

with supplier. If at the end of the contract there is no claim on supplier the consignee

shall give “no demand certificate” to the dealing purchase officer.

b) Where ever installation and commissioning is involved with supply of the equipment,

the user shall forward information about satisfactory commissioning along with details

of claim in any to the dealing purchase officer. In case there is no claim the user shall

give “No claim Certificate” to the dealing purchase officer.

c) In case of service contract user/ Indenter shall forward the details of outstanding claim

(if any which could not be recovered from the regular payment) or a “No demand

certificate” to the dealing officer.

d) In case of LSTK contract, equipment, package, where the performance security is

obtained to cover warranty period also, the user/ indenter shall forward the details of

outstanding claim or a “No demand certificate” to the dealing purchase officer.

e) On receipt of intimation regarding recovery of claim (if any) the concerned purchase

officer shall verify in consultation with finance that whether such claims has already

been recovered from payments or can be recovered from the payments due on the

contractor.

1.5.3. In case it comes out that certain outstanding recovery is to be made from performance

security. The case shall be processed for invocation of Bank guarantee as per the

provision of the contract. The bank guarantee shall be invoked with the approval of

competent authority. Finance Department shall invoke the Bank Guarantee. The SD /


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PBG can be invoked for other reason as provided in the contract, such as

nonperformance, breach of contract, or any other valid reason. In case of no claim /

recovery the performance bank guarantee shall be released after defect liability period

as per provision of contract, after following the due process.

2. CHANGE ORDERS

Change order will be applicable in all the LSTK/ EPC/ works/service contracts. A

change order will be initiated only in case:

a. PLL directs in writing to the Contractor to include any addition or deletion to the

scope of work, design criteria etc.

b. Contractor requests for deletion / addition of any part of the Work and if the deletions

/ additions proposed are agreed to by PLL

c. Any other contractual change leading to change in the contract price either

reduction or increase in contract price.

2.1. CHANGE ORDER PROCESS

i. Any change/extra work not covered under current contract shall be identified. Once

such requirement has been identified, the detailed technical assessment related to

the requirement is finalized between the PLL representative and the supplier /

contractor.

ii. In case of additional scope, the finalization shall involve indicative additional

timelines for executing the additional scope, detailed technical requirements /

design needed for executing the work. The supplier / contractor shall give the

estimate for additional work. In case the change is such that it may result in

reduction in contract price, the estimate for the same shall be given by the

contractor.

iii. Based on cost estimate and details provided by contractor, the engineer in charge

in consultation with PMC (if applicable) shall put up a proposal for deliberation and

recommendation by a committee (consisting of members from user department,

C&P & finance department) for approval by the competent authority. Such

recommendation shall confirm the reasonability of increase in price and extra time

required commensurate with the additional scope of work. In case any change leads

to reduction in price the adequacy of the reduction in price in relation to reduction

in scope of work may also be confirmed in committee recommendation.


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iv. The tender committee recommendation shall be approved by the competent

authority who has approved the award, however the cases which were approved

by the director and above, approval for the same shall be obtained from concerned

Director.

v. Based on the approval the change order shall be issued by C&P department.

vi. Preferably the process of issuance of change order should be completed before

executing the extra work, however in case of urgency contractor may be advised

by engineer in charge to proceed with execution of additional work and

simultaneously the proposal may be initiated for approval by competent authority

so that change order may completed timely.

2.2. VARIATION IN QUANTITY

i. In item rate contract if there is quantity variation, the engineer in charge will get the

contract executed with variation in quantity. In case the variation is more then (+/-)

10% of original quantity the engineer in charge shall make a report along with

reason for such variation and the same should be communicated to the competent

authority which has approved the award of contract for information and advice to

the concerned people for accurate assessment of quantity for future tender.

ii. The competent authority shall be the one who approved the award of the contract,

the cases which were approved by the director and above, approval for the same

shall be obtained from concerned Director.

3. INLANDTRANSPORTATION / SHIPMENT/ DISPATCH &SHIPPING DETAILS /

CUSTOMS CLEARANCE/ LETTER OF CREDIT/ EXPORT PROCEDURE.

3.1. INLAND TRANSPORTATION

Inland transportation covers , the transportation of ordered goods from the

supplier(s) works, in case of domestic supplies or from port of entry in case of

foreign supplies , to the relevant delivery point as may be specified under the terms

of the purchase order. The Purchase order should include instructions in this

respect in sufficient clarity so that no dislocations of ordered goods take place and

disputes resulting out of the same are avoided.

3.1.1. As a matter of practice the purchase order(s) on domestic supplier(s) are finalized

based on FOT (free on truck) / FOR (free on Rail) project site on freight prepaid

&door delivery basis except for the cases where order(s) are finalized on FOT


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dispatch point (normally Vendor's works) basis, in which case the transportation is

arranged by supplier(s) / PLL on 'freight to pay' basis and the freight is paid at the

destination. Normally transportation of goods for domestic supplies is through any

one of the following modes:

(i) Dispatch by Rail

(ii) Dispatch by Road

(iii) Dispatch by Air

3.1.2. TRANSPORTATION OF IMPORTED GOODS

(i) Where the contract is on FOB (free On Board) / FCA( Free along Carrier)/ FAS (

Free along Ship) port/ airport of exit basis, the supplier shall arrange for

transportation of good from their works to port / airport of loading in their country.

Sea freight and inland transportation after arrival of materials at port of destination,

customs clearance and collection of delivery thereof in such cases is carried out by

PLL.

(ii) Where the contract is on CFR (cost of supplies and Freight) / CIF (cost of supplies,

marine insurance and marine freight) the supplier shall arrange for transportation of

goods, till port of loading in his country and shall also bear the marine freight

charges and / or cost of insurance of goods in transit, as the case may be, as a part

of his contract. The inland transportation cost pertaining to shipment of material

from the port / airport of destination upto the site or where the material is to be

stored or processed is borne by PLL.

3.2. SHIPMENT OF IMPORTED GOODS

3.2.1. SEA SHIPMENT

(a) FOB /FAS CONTRACTS

(i) Copies of PO in duplicate are forwarded to Ministry of Shipping & Surface

Transport.

(ii) Shipping arrangement are made by Ministry of Shipping & Surface Transport

(Chartering Wing), New Delhi on receipt of copies of PO through their respective

forwarding Agent / nominees as appointed by them.Document downloaded on 09-04-2022 07:07:28 by

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(iii) Shipment is arranged by MOST after getting adequate advance notice (at last 6

weeks before the cargo readiness) about the readiness of consignment given by

the seller from time to time depending upon the requirement of the purchase order.

All shipment are made by first class direct vessels. The foreign sellers are required

to arrange with the vessel owner / shipping agents ofr forwarding agents for proper

storage of entire cargo intended for the project in specified manner so as to facilitate

the handling and offloading at the port of destination and to avoid any over carriage

at the port of discharge. All the shipments shall necessarily be arranged "UNDER

DECK" unless carriage of "OVER DECK “is unavoidable, which may be done with

the prior approval of PLL.

(iv) All the shipment are required to be through Indian flag vessels or / UK/ India/

Pakistan conference or US/ India/ Bangladesh/ Pakistan conference vessels as the

case may be. However, in case the vessel is not available out of these categories,

MOST may take decision to consider the shipment through other than above

specified vessel as per the Government Guidelines.

(b) CFR OF CIF CONTRACTS

Contracts on CFR/ CIF basis are finalized only after obtaining NOC form Ministry of

surface transport and the shipping arrangements are to be made by supplier as per

provisions of the Order.

3.2.2. SHIPMENT BY AIR

All air shipment are to be arranged by nominated freight forwarding / consolidated

agents of PLL unless specified otherwise. Air shipment shall preferably be arranged

through 'Air India' on 'freight to pay' basis either through the nominated forwarding

agent or by directly contracting Air India.

3.2.3. Instruction for arranging Air/ Sea Shipping Documents

(i) The Bill of lading or Air way bill shall be made out to the order of PLL and not to the

order of bank and notify party shall be the concerned port office of PLL. All columns

in the body of bill of lading / AWB namely marks & number, material description,

weight particulars etc. shall be filled in accurately in accordance with the purchase

order conditions and such statements should be uniform in all the shipping


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documents. The freight particulars should be mentioned along with the basis of

freight, tonnage, heavy lift charge, surcharge, discount, if any etc. clearly &

separately and the net total freight payable shown at the bottom.

(ii) All shipment shall necessarily be arranged on 'freight to pay 'basis (i.e. freight

charges payable at destination) consigned to the designated port as specified in the

contract , except for CFR/ CIF contracts where the freight is paid at the shipping

port itself.

(iii) All documents viz. AWB/ bill of lading, invoices, packing list, freight memo etc. shall

be arranged only in English language.

(iv) The bill of lading / AWB , invoice & packing list specifically must show the marks &

nos. of contents , case wise , country of origin, consignee name , port of destination

and all other particulars Invoices must show the unit rates and net total FOB prices

as per the contract . Items packed separately should also be involved and the value

shown accordingly as per the contract. Packing list must show apart from other

particular actual content of each case, net and gross weight, dimension and total

no. of packages / cases. All documents are to be signed by vendor's authorized

representatives.

(v) The bill of lading / AWB shall indicate the following :-

Shipper - Govt of India (for contract on FOB / FAS port of exit basis) or vendor (for

contracts on CFR/ CIF port of discharge basis). Consignee- PLL. Notify Port - PLL,

Bill of Lading / AWB in no circumstances be made out to the order of the SHIPPER.

3.3. TRANSIT RISK INSURANCE

(i) All equipment / material are to be insured by PLL for transit risks unless specified

otherwise in the purchase order, to cover the damages during the transportation

etc.

(ii) Any such damage during the transportation shall be immediately notified to under-

writers as well as the transporter, for further necessary action for recovery of transit

damages.

(iii) for the purpose of arranging transit insurance of the goods dispatched / shipped ,

vendors are required to furnish the dispatched / shipping particulars to the

Insurance Company giving complete details of dispatches along with policy number

etc.


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3.4. ADVANCE INTIMATION OF DISPATCH / SHIPMENT

The Vendor(s) are advised in P.O to furnish information in advance with regard to

dispatch / shipping particulars for making necessary arrangements by PLL for its

receipt / custom clearance etc. Generally the following information is required to be

furnished by vendor;-

(i) The name of the transporter / shipping agency through whom the material have

been dispatched / shipped.

(ii) Name of vessel (for consignments shipped through sea) and air liner & flight No.

(For air consignment) relevant in case of imports.

(iii) In case of domestic supplies the LR no’s (Lorry receipt) / GR No. ( Goods receipt)

together with the date thereof and in case of shipment by sea or air the Bill of Lading

No. or airway bill No. together with date thereof.

(iv) The dispatch point 9 for FOT Dispatch point - domestic supplies) / port of shipment

(for supplies on FOB basis).

(v) The invoice number, value and date

The vendor shall not, except with previous consent in writing of the purchase

authority, sublet, transfer or assign the contract or any part thereof or interest

therein or benefit or advantage thereof in any manner whatsoever. Provided,

nevertheless, that any such consent shall not relieve the contractor from any

obligation, duty or responsibility under the contract.

(vi) Number of cases in which the shipment is embarked and the net and grass weights

of the cargo.

(vii) The expected date of departure (ETD) form the port of shipment and expected date

of Arrival (ETA)at the port of ______

3.5. CUSTOM CLEARANCE

After shipment of goods by foreign supplier(s) against PLL purchase order & its

arrival at port (sea/ air) of discharge / destination ( usually Mumbai) , customs

clearance activities are arranged as per the prevailing custom procedure ( as

elaborated in store procedure manual for reference) by PLL 's Port consignee which

include inter alia the following :

– Appointment of clearing & forwarding agent

– Registration of project for which imports are required to be arranged. Document downloaded on 09-04-2022 07:07:28 by

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– Liaison with customs / port authorities.

– making payment of customs duty and all other port charges

– Fixing up of transport agency for transportation of imported goods to project site.

– Arranging for warehouse of imported goods, if required.

– Filing & settlement of claims with underwriters & filing of claims with custom

authority for refund of duty , if any,

– Reconciliation of imports - all other activities associated with such imports.

4. INSPECTION OF MATERIAL / WORKS / SERVICES

The inspection shall be carried out as per provisions provided in individual purchase

order / contracts. The inspection of material/ works shall be coordinate with

contractor / vendor in a manner such that the delivery of material / execution of work

is not affected due to delay in inspection.

4.1. JOINT MEASUREMENT OF WORK EXECUTED

4.1.1. The measurement of the work executed, billing, invoice and payment shall be as

per the provisions of contract.

4.1.2. Measurement shall be as per the methods of measurement spelt out in

specifications/Contract procurements. The responsibility for checking the

measurements as recorded in the Measurement Books/Bills shall be as under:

A. WHERE PLL EXECUTIVE IS ENGINEER-IN-CHARGE (EIC) E.G. (O&M

CONTRACTS)

a. Site-in-charge/site engineer will check 100% measurements of executed work.

b. EIC will further check measurements at least 15% of bill value. IN case, site-in-

charge/site engineer is not available, EIC will check 100% measurements of

executed work.

c. An officer one level above EIC but not below level of HOD will check measurements

of 5% of bill value. IN case, HOD is EIC, then he will check measurements of 20%

of bill value.

B. WHERE PMC IS EIC E.G. PROJECT CONSTRUCTION):

a. PMC will check 100% measurements of executed work.

b. PLL site Engineer will check measurements of at least 15% of bill value, certified

by PMC.


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c. An officer one level above site Engineer but not below level of DGM will further

check measurements of 5% of bill value. However, wherever CM is not available,

an officer of one level below CM will check measurement of 5% of bill value.

C. WHERE PLL EXECUTIVE IS EIC AND WHERE THIRD PARTY INSPECTOR IS

DEPLOYED (E.G. ARC TYPE CONSTRUCTION CONTRACTS)

a. Third party Inspector will check 100% measurements of executed work.

b. PLL Site engineer will check measurements of at least 10% of bill value, certified

by third party Inspector.

c. EIC will further check measurements of 5% of bill value. In case there is no site

engineer, EIC himself will check measurement of 15% of bill value.

d. An officer one level above EIC but not below level of HOD (for O&M cases) and CM

(for project cases) will check measurements of 5% of bill value. In case, HOD (for

O&M cases) and CM (for project cases) is EIC, then he will check measurements

of 10% of bill value or measurements of 20% of bill value, in case there is no site

Engineer.

D. OIC (or HOD in case of corporate office) or an officer of higher level to that of EIC

authorized by OIC may carry out random checking of executed items where the

executed quantity exceeds SOR quantities.

E. While exercising test check of 5%, 15% level and on random basis as above, it may

be ensured that high rate items, AHR items, items exceeding SOR quantity and

concealed items have been covered in the items selected for checking.

F. The superior officer should preferably check such items/quantities other than those

already checked by PLL executives at lower levels and should also ensure that the

subordinate officer/officers have exercised the requisite percentage check as

stipulated in the procedure.

G. All concerned officers should indicate the measurements of SOR items checked by

them and marked as “checked and verified”.

H. Necessary provision mandating the above shall be included in the tender document

under Special Conditions of Contract.

4.1.3. The Abstract of bill and the memorandum of the bill shall be signed by PLL

Engineers rather than countersigned.

5. T IME EXTENSION FOR ONGOING CONTRACT

In cases where the delivery / work is not likely to be completed as per original


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schedule, the time of delivery / completion should be suitably extended before the

expiry date of mobilization / delivery / completion, so that the contract continues and

the job is executed. Such extension will be provisional without prejudice to the

contractual right of owner including right for PRS (Price Reduction Schedule).

The indentor / Project department shall make a recommendation for such extension

confirming that continuation of the contract with existing contractor is essential in

the interest of the job. No Tender committee is required in this case. Further no

financial concurrence is required. The competent authority shall approve such

proposal where ever the competent authority is director and above, the approval by

concerned director shall suffice.

The amount of Price Reduction (PRS) shall be withheld on proportionate basis from

the bills of supplier/ contractor while releasing the payments.

Seeking approval for extension in delivery /completion period on ex-post facto basis

should be avoided, as far as possible and that extension, if any, in delivery

/completion period should be given to the contractor before the expiry date of

delivery/ completion after obtaining approval of the competent authority. However,

in exceptional circumstances, if extension in delivery / completion period is not given

before the expiry of the delivery/ completion period, in such cases, ex-post facto

approval for extension of delivery/ completion period can be accorded by the

authority as per DOA. In cases where CPA is director and above, director

concerned shall approve such proposal.

On completion of contract/ delivery / services there shall be a delay analysis. During

the examination of the delay it shall be established that how much delay is on

account of contractor and how much delay is on account of PLL. The Engineer in

charge shall make a recommendation with delay analysis and finally applicable

Price Reduction or otherwise.

The tender committee which will make recommendation for closure of contract shall

consider the recommendation of engineer in charge for PRS (Price Reduction

Schedule) or otherwise. The tender committee shall comprise of members from

finance, C&P and user department who shall make a recommendation to be

approved by the competent authority for PRS (Price Reduction Schedule) or

otherwise.

PRS (Price Reduction Schedule) will be calculated on the basis of supply order

price of materials/ work services excluding duties and taxes, where such


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duties/taxes have been shown separately in contract/supply order. In case of

service contracts PRS will be calculated on the basis of annual contract value

excluding duties and taxes, where such duties/taxes have been shown separately

in the contract.

6. APPLICABLITY OF PRICE REDUCTION SCHEDULE

In all cases of delays beyond contractual delivery date / contractual completion

schedule Price Reduction shall be applicable except the following;

i. When Force Majeure occurs during the contract execution period and the supplier /

contractor adheres to and fulfills all his obligations stipulated in the contract.

ii. When PLL defaults in fulfilling its obligations, hindering the progress of works and

causing the delay in execution. However if contractor himself is not ready, the delay

on part of PLL shall not be the justification for nonperformance by the contractor.

iii. Reason for delay in supply / completion of work for which PLL is responsible:

a) Delay in approval of drawing, where drawing approval is required before proceeding

with manufacturing.

b) Delay in release in work fronts such as, work site, foundation for erection of

equipment etc. which is in PLL’s responsibility as per contract.

c) Delay in providing free issue materials, details pertaining to sizing and other requisite

information essential for proceeding for manufacture/ fabrication/ construction.

Delays in payments against certified bills of vendors/ contractor and such payments

affects adversely any sequential activities of contractor involving major finance.

7. BILL WATCH SYSTEM

Computer generated receipt should reach vendors/contractor for each and every

bill submitted by them to PLL/PMC.

The vendor/contractor should be able to track the status of their bill through the

internet.

8. PAYMENT PROCEDURE

During the execution of the contract the payment shall be released promptly in

accordance to the payment terms provided in the contract / Purchase order linked

with various milestones. The payment should be released after submission and

checking of requisite documents as provided in the contract / purchase order.


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9. LETTER OF CREDIT

a) A foreign letter of credit is a very common and familiar instrument in settling trade

between parties belonging to different nations. Buyers and sellers negotiate for

purchase and sale of goods, sellers demanding cash or the buyers’ banker’s letter

of credit as guarantee for payment before they undertake shipment. A letter of credit

reinforces the buyer’s integrity by adding to it his banker’s undertaking. A

documentary credit is a signed instrument embodying an undertaking by the banker

of a buyer to pay his seller a certain sum of money in presentation of documents

evidencing shipment of specified goods and subject to compliance with the

stipulated terms and conditions.

b) In order to bring uniformity in matters pertaining to documentary credits, the

international Chamber of Commerce (ICC), Paris have published a set of Rules

(called UCPDC), wherein a documentary credit has been defined as , “Any

arrangement, however, named or described, whereby a bank ( the issuing bank)

acting at the request and on the instructions of a customer ( the applicant for the

credit) or on its own behalf is to make payment to or to the order of a third party (the

beneficiary) or to accept and pay bills of exchange drawn by the beneficiary) or to

accept and pay bills of exchange drawn by the beneficiary; authorizes another bank

to effect such payment or to accept and pay such bills of exchange or authorizes

another bank to negotiate against stipulated documents and compliance with

stipulated terms and condition.”

c) Banks handling documents under a credit are guided by the UCPDC Rules.

d) A documentary credit requires that drafts drawn there under (representing money

claim) must be accompanied by other documents as stipulated therein, giving title

to the goods, providing protection to loss or damage to the goods, and furnishing

other information and particulars. Bills of Lading, Marne Insurance Policies or

Certificates, Commercial Invoice, Customers Invoice, Certificate of origin, weight

list, packing list, Inspection Certificate of Analysis and / or other documents may be

stipulated, are such documents.

e) When a person who ships goods in reliance on a letter of credit issued by a bank,

does so in exact compliance with its terms the bank concerned is bound to honour

his draft if drawn and presented in strict accordance with the credit as opened. They


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paying or the confirming bank can claim indemnity if the term and conditions of the

credit are strictly observed, for which it must examine all the documents with care.

9.1. MECHANISM OF DOCUMENTARY CREDITS

a) Acting in accordance with the agreements between seller and buyer, the buyer

instructs his bank to open a credit.

b) Before the bank acts on the instructions, it checks whether the customer’s balances

or credit facilities will permit the payment to be made under the documentary credit.

c) If the bank is asked to open a documentary credit in favour of a foreign seller, it

generally utilizes the services of a correspondent bank, if possible, at the same

location as the seller. This second bank is referred to as the advising bank. It

forwards the credit of the issuing bank to the beneficiary.

d) Following receipt, the beneficiary checks whether he can meet the conditions

mentioned in the credit and whether they agree with those stated in the purchase

contract or other agreement.

e) If this is not the case, he asks the buyer directly to modify the credit conditions.

f) If the credit agrees with the purchase contract and the stipulated conditions that can

be met, the exporter will start manufacturing the goods or deliver them from stock.

Following shipment, the beneficiary will assemble the required documents and

present them to the advising bank.

g) The advising bank checks whether the documents received agree with the

conditions of the credit in all respects. Afterwards, it makes payment in the manner

prescribed in the credit and transmits the documents to the issuing bank. The latter

reimburses the advising bank the amount specified under the documents.

9.2. REVOCABLE OR IRREVOCABLE LETTER OF CREDIT

a) Basically, the credits are either (i) revocable or (ii) irrevocable.

b) All credits should, therefore, indicate whether they are revocable or irrevocable, but

in the absence of any indication, the credit will be treated as irrevocable as per

Article 6(c) or UCP 50.


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c) The inherent weakness of revocable credit is that it may be cancelled or modified

without prior notice by the issuing banker to the beneficiary. However, the opening

bank is responsible for any operation on the revocable credit effected prior to the

receipt by the negotiating bank of any cancellation or modification advice.

d) An irrevocable letter of credit does not suffer from such disadvantage and it is,

therefore, widely accepted. An irrevocable letter of credit constitutes an irrevocable

commitment on the part of the issuing bank provided stipulated documents are

presented and the conditions of the credit are complied with. In this case, the issuing

bank has no recourse to the drawer in the event of non-payment.

e) Both revocable and irrevocable credits are advised by the advising bank without

any engagement on their part. When the beneficiary insists on bank in his own

country to add its undertaking to pay against presentation of proper documents the

credit is deemed to bear confirmation of the advising bank and the credit is called

confirmed credit. The credits are confirmed under the express authority or request

of issuing bank. However, if the advising bank is not prepared to add its

confirmation, it must inform the issuing bank without delay. By adding its

confirmation the confirming bank steps into the shoes of the issuing bank and

consequently its confirmation constitutes a definite undertaking to honor its

commitment provided stipulated documents are presented and the terms and

conditions are complied with.

f) Such an undertaking on the part of the confirming bank can be cancelled only with

the consent of the issuing bank, confirming bank and the beneficiary.

The advantage to the beneficiary under a confirmed letter of credit is that even if he

does not know the standing of the opening bank, he may rely solely on the

confirming bank for the commitment under the letter of credit and is relieved of the

problem of any “sovereign risk” or “transfer risk” attributable to the country where

the L/C opening bank is situated.

Moreover, the exporter can get payment without recourse from the confirming bank

in his country and the ‘transit risk’ that the documents may get lost or damaged

during the course of transmission to the L/C opening bank is also avoided for the

exporter. If the confirmed L/C is also a transferable one, the beneficiary will find it

easy to find a transferee to whom the credit is acceptable if the L/C has beenDocument downloaded on 09-04-2022 07:07:28 by

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confirmed by a bank in the beneficiary’s country.

9.3. CONFIRMED CREDIT

If an irrevocable credit is opened by a bank in the buyer’s country, the seller may

require the credit to be confirmed by a bank in his own country as he may be

unaware of the standing of the opening bank, or may otherwise like to ask for

additional protection of his interest. In such cases, the opening bank request its

correspondent in the seller’s country to add its confirmation which in effect means

that the confirming bank undertake the liability to honour the seller’s draft drawn

under the credit. It bears an unequivocal undertaking that drafts confirming to the

terms of the credit will be honoured notwithstanding any change in the position

between the person or the bank opening the credit and the bank confirming the

same. It ensures double protection to the seller since it is already irrevocable on

the part of the opening bank and additionally on the part of the confirming bank in

his own country. Although a confirmed letter of credit is irrevocable, an irrevocable

credit is not necessarily a confirmed one.

9.4. REVOLVING LETTER OF CREDIT

Such credit stipulates automatic restoration of the amount already drawn (under the

credit)- as soon as the bills are paid, thus obviating the necessity of opening a fresh

credit for each despatch / shipment. A revolving credit may revolve with reference

to the either its amount or validity period, and if the latter, it may be either cumulative

or non-cumulative.

9.5. THE SIGHT CREDIT

a) The amount is payable as soon as the prescribed documents have been presented

and the bank has checked them. So the proceeds are normally at the immediate

disposal of the beneficiary.

b) In some cases (e.g. foreign currencies) a few days may pass between presentation

of the documents and actual transfer of the funds. As a rule it is the time required

by the banks to remit the amount of the credit.

c) In the case of unconfirmed credits, situations can arise where the advising bank

delays payment to the beneficiary until it has received the amount specified by the


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documents from the issuing bank.

9.6. STAND-BY LETTER OF CREDIT

a) The stand-by letter of credit is a guarantee declaration in the broadest sense. It is

used mainly in the USA, because American banks are prevented from giving

guarantees by the regulations in that country.

b) Stand-by letter of credit can be used, for example, to guarantee the following types

of payment and performance:

- Repayment of loans

- Fulfilment of sub-contractors

- Securing the payment of goods, deliveries by third parties and dependent of the

recipient,

- bid bonds

- Performance bonds

9.7. PAYMENT THROUGH LETTER OF CREDIT

a) Whenever the contract specified payment through Letter of Credit (LC), the

purchaser shall open an irrevocable Letter of Credit, which is generally the

acceptable mode of operating through Letter of Credit in case of international

commercial transactions.

b) For this purpose, the supplier is required to furnish the details of their bankers

through whom such a Letter of Credit is required to be operated for negotiations

and payments. As a general rule, the Letter of Credit is opening by the purchaser

through their bankers who give corresponding guaranties for making payments to

the supplier. The Letter of Credit as normally operated are not required to be

confirmed in the country of the purchaser.

c) However, at times some of the suppliers insisted on confirmed Letter of Credit for

which the additional fee charged by the corresponding banker is borne by the

supplier himself, depending upon such agreement with buyer.

d) Following details shall be required for opening the Letter of Credit which also forms


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a part of terms and conditions of Letter of Credit for the purpose of documents

negotiation and payment against shipment :-

1. Beneficiary of Letter of Credit

2. Value of goods and payment to be made

3. Validity of L/C for shipment and negotiation as per delivery requirement of Purchase

Order (Normally 2-3 weeks are allowed after shipment for negotiation of

documents).

4. Mode of shipment whether by sea or by air?

5. Inspection requirements

6. Any other test certificates, Quality Assurance certificate required in accordance with

the Purchase Order.

7. Any other documents as may be required under Letter of Credit such as:

a) Supplier’s confirmation for furnishing shipping details to insure Company to arrange

for marine insurance.

b) Certificate of recent manufacture.

c) Certificate of country of origin

8. Any other operative instrument to be kept in Letter of Credit such as Purchase Order

acceptance and confirmation of submission of contract Performance Bank

Guarantee of the supplier in accordance with the provision of Purchase Order.

9. Port of shipping

10. Port of discharge

11. Whether part shipment would be allowed. Whether trans-shipment would be

allowed.

12. The provisions pertaining to price reduction schedule in case of delay in deliveries

beyond the contractual delivery date. In such an event the documents are to be

negotiated for a reduced value proportionate to the amount of as per contractual

provisions of price reduction.


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e) Normally foreign bidders insist for commencement of delivery period- until after they

have received the Letter of Credit. However, for getting a hold on the delivery

requirement, a conditional Letter of Credit may be opened, though, such a

conditional Letter of Credit is neither operable nor does it certify any other

performance for any commercial transaction. The Letter of Credit in such an event

can be made operative upon submission by the supplier of another document which

could not be furnished earlier before opening of such a conditional Letter of Credit.

(e.g., submission of an unconditional order acceptance and submission of Contract

Performance Guarantee). A time frame can be made part of the Letter of Credit to

enable seller to submit such documents, as a check to expedite action by him.

10. MILESTONE PAYMENT

Milestone payments can be made as per payment schedule in the contract. The

amount for PRS (if applicable) shall however be withheld by finance, from the bills

of supplier / contractor, while releasing payments as per terms mentioned in the

contract.

The invoice should be accompanied with all relevant documents required for

releasing the payments. An invoice complete in all respect as per provision of the

contract should be processed expeditiously and payment is released in maximum

15 days.

In case there is any observation / comments against the invoice the same should

be communicated promptly not later than 5 working days after submission of

invoice.

All the payments shall be remitted to the vendor's / contractor's bank account as

per the initial details specified in the bids. The payment shall be made in currencies

stated in the Contract. PLL shall also inform in writing to the vendor / contractor the

details of remittance i.e. amount and date.

In case there is any recovery from the contractor/ payment due to PLL shall be

recovered from the invoice and the contractor shall be informed accordingly.

11. PRICE ESCALATION AND ADJUSTMENT

In case the contract provides with a formula for price escalation or any adjustment

the same shall be worked out as per provision of the contract, and adjustment shall

be made while releasing the payments.


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12. EXTENDED STAY COMPENSATION

12.1. The tenders being issued, provide for a clause pertaining to payment of extended

stay compensation to the contractor in the event the contractual schedule is

extended beyond the time period specified in the contract for reasons which are

solely attributable to the owner.

The provision is basically for a notional compensation to the contractor as the

extension and specifically the continuation of establishment of the contract at the

site is necessitated for reasons of non-availability of fronts or materials which are in

the scope of owner’s obligations. As time is the essence of the contract, unless

extended the contracts would generally conclude on the date the time schedule

expires, such a provision of extended stay compensation has the effect of keeping

the contract alive.

12.2. The general conditions of the contract provide for that “the schedule of rates quoted

by the bidder shall be deemed to cover the risk of all possibilities of delay and

interference with the contractor’s conduct of work, which occur from any causes

including orders of the owner in the exercise of its power and on account of

extension of time generated due to various reasons and for all other possible and

probable causes of delay.” The Provision of extended stay compensation is an

overriding clause included in the Special Conditions of Contract.

12.3. Further, a nominal amount is indicated or agreed as a compensation to be paid and

that too is permitted after a grace of about 1/5th of the time of completion of the

contract or at least two months (beyond the time schedule included in the contract).

The following clause is generally provided for:

“In case the time of completion of work is delayed beyond time schedule indicated

in the tender plus a grace period equivalent to 1/5th of the time schedule or two

months whichever is more, due to reasons solely attributable to the owner, the

contractor shall be paid extended stay compensation in order to maintain necessary

organizational set up and construction tool, tackles, equipments etc. at site of work”

12.4. As is evident, the purpose of providing for this is to compensate the contractor only

for maintaining his set up at site which may inter alia include the bare minimum


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requirement of men and machinery necessary only to execute a very small amount

of left over work. In addition to the compensation payable for the extended stay,

contractor would receive payments towards the work done during the extended time

schedule as per provision of the contract. The provision for compensation for

extended stay must be exercised with abundant caution.

The following essential pre-requisites, therefore, should be kept in mind:-

a) The extension in the contract should necessarily have been as a result of reasons

which do not under any circumstances account for delays by the contractor himself.

As such if owner failed to fulfil the obligations namely providing materials stated to

be provided as free issue or at a specified rate, providing land or foundations or

other physical work fronts or providing drawings necessary to execute work etc. and

if during this period the contractor was fully mobilized with all necessary

construction tools and tackles and materials in his own scope of supply as also the

contractor has fully established at site with sufficient man power; the provision for

extended stay if the contract is required to be extended would become applicable.

b) It is necessary that all contractual provisions be kept in mind before a final decision

as to the applicability of extended stay compensation or otherwise can be finalized.

Various provisions in the General Conditions of Contract require that the contractor

shall have performed in accordance with the agreed schedule of work progress. It

would, thus, be necessary to establish that there were no failures attributable to the

contractor at any stage during the contract execution. In this regard provisions

contained in General Conditions of Contract assume importance. These provisions

inter-alia provide that the contractor should prepare a detailed monthly or weekly

construction programme, with the Engineer-In-Charge within one month of receipt

of Letter of Intent and the work shall be executed strictly as per this time schedule.

Further, the contractor is also required to submit a detailed PERT Network within

the time frame agreed and the same is required to consist of adequate number of

activities covering various key phases of the work such as design, procurement,

manufacturing, establishment and field erection activities within 15 days from the

date of Letter of Intent.


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c) In the event it can be established during the execution of work that Contractor also

failed in certain respects in fulfilling his obligations under the contract, the

applicability of compensation for extended stay would not be justifiable as, even if

the owner had not failed in fulfilling his obligations the contractor may have failed in

achieving the compensation in time. In such an event, as per the provision of the

contract PRS would have become applicable. This, therefore calls for review of the

case in its entirety prior to final decision in the matter.

d) Needless to say that such an analysis may require going through the records

extensively particularly with regard to the mobilization of the resources by the

contractor, mobilization of adequate work force at sites supply of materials covered

in the contractor’s scope of supply and release of work fronts including drawings

etc. by owner/consultant.

e) If, however, it can be reasonably assessed that the work fronts/materials/drawing

would not be available in the near future also and there would be delays in doing

so, it may be worthwhile to deliberate amongst the following options:-

i. To get the job executed through an alternative agency for which either a fresh

enquiry would be required to be issued; or

ii. To get the job executed through an existing contractor, whose contract is expected

to continue for a longer period, at the rates at which the contract had been awarded;

or

iii. To seek demobilization of the contractor so as to remobilize him later at site, when

work fronts, materials and drawings etc. are expected to be made available for

execution of work. In such an event, the financial implication for demob/remob

should be analyzed vis-à-vis extended compensation while choosing the option

between asking the contractor to demob/remob and retain the contractor and pay

extended stay compensation; or

iv. In taking the final decision with regard to applicability of compensation for extended

stay compensation it may be pertinent to evaluate the date available in that regard.

As also it is important to ascertain at what point of time such an exercise could be

meaningful. The following important observations made at the time such a situation


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confronts the contract administrators at site will have a bearing on the final outcome

in respect of Owner’s liability to pay compensation.

a) The contract has not yet concluded.

b) Major portion of the work awarded has been complete while a small portions still

remains to be executed by the contractor. The contractor established adequately

and continued to have made available at site adequate resources and manpower.

c) Obviously there have been delays which can be attributable solely to PLL and

contractor has not contributed to the delay in any manner.

d) The work cannot be executed through an alternative agency or resources to

alternatives modes

e) The contractor’s available resources of work force and construction equipment is

adequate at this stage.

f) The presence of the contractor is essentials as in case he is carrying out

continuously some works for which the work fronts are still being released.

g) In view of the contractor performing some minor works on the work fronts released

to him, he cannot be asked to demobilize and mobilize once again at a later date

and the discussions pertaining to the future methodology to complete the work have

taken place and contractor’s presence at site is considered essential at any cost,

and

h) The contractor has refused to carry out the left over works without payment of

compensation for the continuing at site.

v. While the work is still being executed at site some of the decisions would be difficult

to be arrived at. An appropriate time would be when it is possible to take the entire

data relating to execution of work into cognizance. It would, therefore, be crucial

that analysis of the factors has been done before decision to accept payment to

contractor towards extended stay compensation is take, as apart from additional

expenditure beyond the contracted amount it would also have an effect of

acknowledging the delays to be solely on account of PLL and subsequent findings

to the contrary may be difficult to sustain.

13. CHANGE IN TAXES AND DUTIES AND OTHER STATUTORY CHANGES

Any changes in taxes, duties or other statutory changes shall be governed as per

terms and conditions mentioned in the Purchase Order / Contract.


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14. CLOSURE OF PURCAHSE ORDER AND WORKS CONTRACT

14.1. One of the important requirement after the execution of the order and completion of

the works by the supplier / contractor, is the closure of the Purchase Order /

Contract.

The following are to be examined and considered in accordance with terms and

condition of the contract:

i. The supplies have been made as per the specifications provided in the Order.

Correspondingly the work has been executed in accordance with specification and

scope given in the contract.

ii. The time schedule for delivery and completion time for the contract has been

adhered to. In case of delay whether the matter related to Liquidated Damages has

been dealt with as per provision of the contract / Purchase order. At this stage it is

to be examined whether PRS (Price Reduction Schedule) for delay in supply has

been recovered in case of purchase orders. In case of works contracts it is to be

seen that whether Engineer in charge has retained or recovered PRS amount for

delay if any.

iii. All payments have been released as per provision of the contract / Purchase order

and PBG are available with required validity to cover the warrantee period.

iv. In case of works contract / LSTK it is to be ascertain whether free issue material

has been reconciled. The recovery of any on account of excess consumption /

scrape generated beyond the tender provision have been made or accounted for

making such recovery.

v. In the event of any shortage or damages were noticed in the materials received,

necessary replacements have either been received or claims lodged for

replacement of such material, in so far as the liability of the vendor can be specified

in that context. Similarly for the damages and or defect noticed in the works

executed by the contractors necessary rectification have been carried out and

recovery if any made in that regard from the contractor.

vi. If any additional / extra work has been executed by the contractor the required

settlement have been done with regards to price and time required for such extra

work and the payment has been affected.

vii. The recommendation of Engineer in Charge in consultation with PMC (if applicable)

regarding closure of the contract considering all aspects including but not limited to

analysis for delay if any, time extension and applicable Liquidated damages.


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14.2. A committee consisting of member from user department, C&P and Finance shall

examine all the issue above including the site recommendation for the closure of

contract. Where the committee shall recommend inter –alia the following;

I. Final time extension, in case PRS (Price Reduction Schedule) is applicable the

amount of recoverable Price.

II. Any recovery from the contractor and amount thereof

III. Confirming the availability of required PBG to cover the warrantee period.

IV. Any other issue which Committee considers essential.

V. Net amount to be recovered or payable to the contractor as final payment.

15. EVALUATION OF PERFORMANCE OF VENDORS/ CONTRACTORS /

CONSULTANTS

The performance of vendors / contractors / consultants is important to support an

effective purchasing & contracting function of an organization. Therefore,

performance of all participating vendors / contractors / consultants need to be

closely monitored to ensure timely receipt of supplies from a Vendor, completion of

an assignment by a consultant or complete execution of order by a contractor

within scheduled completion period. For timely execution of projects and

meeting the operation & maintenance requirement of operating plants, it

is necessary to monitor the execution of order or contracts right from the award

stage to completion stage and take corrective measures in time.

The indenter / C&P / Project shall keep a record of the performance of vendors /

contractors / consultants associated with PLL. The objective is to recognize, and

develop reliable vendors / contractors / consultants so that they consistently meet

or exceed expectations and requirements.

At the end of every contract the performance of every vendor / contractor are to

be evaluated under various heads with proper marking. This is to be done as per

a laid down guideline and procedure in PLL. The Procedure shall have evaluation

of the vendors / Contractor and put them under various categories like Poor,

satisfactory, good and very good wherever necessary the vendors shall be issued

advisory for improvement. if need be based on such evaluation in accordance with

laid down procedure some vendors can be put on holiday for non-performance

after following the due process.


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SECTION-IV

PROEDURE FOR SELECTION OF CONSULTANTS

1. PURPOSE

1.1 The practice of employing outside experts with special skills and experience called

“Consultants” to assist in dealing with various tasks is well established in Corporate

World. With increasing complexities in business operations, rapid change in

technology, tax and commercial business environments and globalization of

business activities, consultants play an important part in terms of providing new

external environment inputs, specialized knowledge, international perspectives and

practices.

Consultants provide the intellectual inputs in the form of innovative and creative

Advice/Reports/ Recommendations etc which have far reaching and long term

impact on the growth of the Company. By providing specialized expertise and an

independent viewpoint, consultants can contribute to the analysis and preparation

of Projects, to their implementation and operation and to the organizational and

financial restructuring often associated with development.

1.2 Advantage of “Consultants” include

– diversity of professional experience

– up-to-date knowledge of the latest methods and techniques

– speed in execution

– reliability of results

– economy in required resources

– independent and objective approach

– transfer of knowledge, skills and techniques coupled with formal training to in-house

staff (need for consultants for future Projects may reduce in such situations).

Consultants are generally appointed by the following departments in PLL. A typical

example of Consultants engaged by various departments are as follows:

(i) Marketing : For Market research, Demand Analysis/

Forecast, Pricing, Long Term Strategies etc.


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(ii) Finance : Lead Arranger/ Merchant Banker, Pricing,

Valuation Experts, Financial Advisor, Forex Consultant, Project Appraisal,

Tax/Legal Consultants, Legal Registrars, Trustees, Rating Agency, Auditor,

Accountants etc.

(iii) HR : Management Consultants, training Consultants,

Organizational Restructuring, Recruitment Consultants etc.

(iv) Business Development : Feasibility reports, Due diligence, Transaction

Advisor, Merger & acquisition etc.

(v) Project development : Feasibility Reports, Legal & financial appraisal etc.

(vi) Corporate Planning : Management Consultants, Performance

Management system, Environment Scanning Analysis, Strategic Planning/

Restructuring etc.

(vii) Corporate Communication : Media relations, Internal Communication strategy,

Branding Strategy & Research etc.

(viii) Corporate Social responsibility : Empanelment of NGOs/CSOs & prescribing

Accrediting Norms, Consultant for conducting Need identification & impact

assessment studies etc.

(ix) Projects : Project Management Consultants (PMC), Inspection

Agents etc.

(x) O&M : Specific studies for maintaining integrity of Process

Plants & other operating facilities, Metering audit, Benchmarking Study, Third Party

Inspections, and Conceptualization study etc.

(xi) Law : Due diligence for big projects

(xii) C&P : Stores/Inventory Management, Disposal etc.

(xiii) R&D : Carrying out of Basic/Fundamental/Applied Research

Projects through external agency on the recommendations of Research Advisory

Council (RAC), shall be governed by approved R&D Policy & Manual.

Exception: This procedure will not be applicable for assignments for appointment of

Lead Arranger/ Merchant Bankers/ Registrars etc. in respect of mobilizing

funds/loans etc.


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1.3 SOLUTION WITHOUT CONSULTANTS

Efficient use of consultants requires considerable efforts. Hiring consultants is not

a simple process. It may therefore, at times be prudent to consider a methodology

that would not require consultants. This may often be possible by mobilizing talent

resources, by minor shifts in assignments or by small increase in manpower.

Assessing the options, “WITH AND WITHOUT CONSULTANTS” is certainly

worthwhile before deciding on the initiation of a major venture. The “WITHOUT”

situation may be particularly advantageous where the assignment is expected to be

repetitive and where a permanent expansion of manpower would be both

economical and expedient. In many cases, reliance on existing manpower can

boost morale, particularly when coupled with a Training Programme.

1.4 SELECTION OF CONSULTANTS

1.4.1. The C&P Procedures, by and large, covers the general aspects of the Process of

selection of vendors/contractors/service providers. Therefore, the C&P Procedure

does not do full justice with the special nature of the consultancy assignments

where quality, intellect and innovations are far more important than just cost.

Therefore, the “LEAST COST METHOD” under C&P Procedure may not be the

appropriate methodology for selection of consultants except assignments of routine

nature or where the physical outputs of the assignments predominate and are

measurable or where very little or no innovation is involved.

1.4.2. While the specific rules and Procedures to be followed to employing consultants

depend on the nature and circumstances of each case, five main considerations

guide the selection Process:-

a) The need for high quality services and expert Knowledge

b) Innovative and intellectual approach

c) The Need for economy and efficiency

d) Competitive Bidding process

e) The need for transparency and fairness

In the majority of cases, these considerations can best be addressed through

competition among qualified shortlisted firms in which the selection is based on the


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quality of the proposals and, there appropriate, on the cost of the services to be

provided.

1.5 Conflict of Interest

PLL requires that consultants provide professional, objective, and impartial advice

and at all times hold the client’s interests paramount, without any consideration for

future work, and that in providing advice they avoid conflicts with other assignments

and their own corporate interests. Consultants shall not be hired for any assignment

that would be in conflict with their prior or current obligations to other clients, or that

may place them in a position of being unable to carry out the assignment in the best

interest of PLL. Without limitation on the generality of the foregoing, consultants

shall not be hired under the circumstances set forth below:

a) Conflict between consulting activities and procurement of goods, works or services

(other than consulting services covered by these Guidelines): a firm that has been

engaged by PLL to provide goods, works or services (other than consulting services

covered by these Guidelines) for a project, and each of its affiliates, shall be

disqualified from providing consulting services related to those goods, works or

services for the Project. Conversely, a firm hired to provide consulting services for

the preparation or implementation of a project, and each of its affiliates, shall be

disqualified from subsequently providing goods, works or services (other than

consulting services covered by these Guidelines) resulting from or directly related

to the firm’s consulting services for such preparation or implementation.

The expert advice/ modification in the existing installation suggested by OEM(s)

shall not disqualify them (OEM) from participation in the tender for such

modifications.

b) Conflict among consulting assignments; neither consultants (including their

personnel and sub-consultants) nor any of their affiliates shall be hired for any

assignment that, by its nature, may be in conflict with another assignment of the

consultants. As an example, consultants hired to prepare engineering design for an


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infrastructure project shall not be engaged to prepare an independent

environmental assessment for the same project.

c) Relationship with Employer’s staff: Consulting (including their personnel and sub-

consultants) that have a business or family relationship with a member of the

Employer’s staff (or of the project implementing agency’s staff) who are directly or

indirectly involved in any part of: (i) The preparation of the TOR of the contact (ii)

the selection process for such contract or (iii) supervision of such contract may not

be awarded a contract, unless the conflict stemming from this relationship has been

resolve in a manner acceptable to the Employer throughout the selection process

and the execution of the contract.

d) A Consultant, who prepares Detailed Feasibility Report (DFR) of a Project is not

debarred from participation as Project Management Consultant (PMC) for the same

Project as both are services in nature.

Normally, TOR should be prepared in-house. However, in exceptional cases, if a

Consultant is engaged for preparation of TOR of an assignment, such Consultant

shall not be allowed to participate in bidding process of the assignment in question.

e) A Consultant who has been appointed by PLL to assist in a bidding process where

PLL is a bidder, should not be a Consultant to any other prospective bidder(s) for

the same assignment. Similarly, a Consultancy appointed by any competition of

PLL in a bidding process shall not be qualified in PLL’s tender for the same

assignment.

1.6 Unfair Competitive Advantage

Fairness and transparency in the selection process require that consultants or their

affiliates competing for a specific assignment do not derive a competitive advantage

from having provided consulting services related to the assignment in question. To

that end, the Employer shall make available to all the short-listed consultants

together with the request for proposals all information that would in that respect give

a Consultant a competitive advantage.


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1.7 Fraud and Corruption

1.7.1. It is required that PLL as well as consultants and their subcontractors, observe the

highest standards of ethics during the selection and execution of contracts. In

pursuance of this policy, for the purpose of this provision, the terms set forth below

as follows:

(i) “Corrupt practice” is the offering, giving, receiving or soliciting, directly or indirectly,

of anything of value to influence improperly the actions of another party;

(ii) “Fraudulent practice” is any act or omission, including misrepresentation, that

knowingly or recklessly misleads, or attempts to misleads a party to obtain financial

or other benefit or to avoid an obligation;

(iii) “Collusive practice” is an arrangement between two or more parties assigned to

achieve an improper purpose, including to influence improperly the actions of

another party;

(iv) “Coercive practice” is impairing or harming or threatening to impair or harm, directly

or indirectly, any party or the property of the party to influence improperly the actions

of a party;

(v) “Obstructive practice”

a) deliberately destroying, falsifying, altering or concealing of evidence material to the

investigation or making false statements to investigators in order to materially

impede an Employer investigations into allegations of a corrupt, fraudulent coercive,

or collusive practice; and /or threatening, a harassing, or intimidating any party to

prevent it from disclosing its knowledge of matter relevant to the investigation or

from pursuing the investigation, or

b) acts intend to materially impede the exercise of the Employer’s inspection and audit

rights

1.7.2. PLL will reject a proposal for award if it determines that the consultant

recommended for award has, directly or through an agent, engaged in corrupt,

fraudulent, collusive, coercive, or obstructive practices in competing for the contract

in question.

1.7.3. PLL will sanction a consultant, including declaring ineligible, either indefinitely or for

a selected period of time, to be awarded a contract if it at any time determines that

the consultant has, directly or through an agent, engaged in corrupt, fraudulent,


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collusive, coercive, or obstructive practices in competing for, or in executing, a PLL

contract.

2. QUALITY AND COST BASED SELECTION (QCBS)

QCBS uses a competitive process among short listed firms that takes into account

the quality of the proposal and the cost of the services in the selection of the

successful firm. Quality is of prime importance and therefore Cost as a factor of

selection shall be used judiciously. The relative weight is to be given to quality and

cost shall be determined for each case depending on the nature of the assignment.

2.1. Enlistment of Consultants

2.1.1. The department concerned shall enlist the Consultants for a particular type of work,

estimated value etc. The enlisting shall be made in the following manner by the

concerned department:

Preparation of Minimum Technical and Financial Criteria (as the case may be) in

line with the guidelines given at 5.0 in this procedure.

Through Press Advertisement in the newspapers, expression of interest shall be

sought from prospective Consultants for undertaking such assignments along with

all relevant information for estimated value of (i) less than Rs. 50 Lacs and (ii) more

than Rs. 50 Lacs.

The concerned deptt. shall obtain approval of the short listed bidders from the

competent authority However, where the Competent Authority for award of job is

Director and above, such approval shall be sought from the Director concerned.

The enlisting should comprise consultants of the same category, similar capacity

and business objectives with rules, limitations for a period of 2 years and the

Consultants shall be communicated in this regard. Prior to 2 years period, the

process of enlisting shall be initiated well in advance and the enlistments shall be

done afresh.

Efforts shall be made to enlist at least six firms. The deptt. may go for enlisting a

smaller number of firms in special circumstances, for example, when only a few


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qualified firms have expressed interest for the specific assignment or when the size

of the contract does not justify wider competition.

2.1.2. In case the departments like BD corporate Planning and Marketing and not able to

do the enlistment of consultant due to non-availability of Information for freezing

Qualifying Criteria for enlistment, in such a situation, the list of respective bidders

on a predefined criteria may be drawn from league list published ny reputed/

eminent International or National agencies ( like Global F&A for financial advisors,

ENR for EPC and design, Vault guide for ranking of consulting firms and similar

others available in public domain with or without subscriptions ranking different

categories of consulting firm, instead of short listing based on BEC in beginning of

the year, with the approval of Competent Authority and such list shall be valid for

use for one year. The exercise shall be done every year.

2.1.3. In case of urgent requirement, which was not known earlier for exercise on

enlistment in above manner, BD Corporate Planning and Marketing (including

Sourcing) may draw a list of prospective bidder (s) for floating the tender from list

published by reputed/eminent International or National agencies (like Global M&A

for financial advisors, ENR for EPC and design, Vault Guide for ranking of

consulting firms and similar others available in public domain with or without

subscriptions) ranking different categories of consulting firm, instead of short listing

based on BEC, with the approval of Competent Authority, This shall be used as

exception.

2.1.4. The unforeseen assignments and/ or considered non-repetitive assignments can

be decided through tendering mode with BEC (instead of enlistment as mentioned

at 2.1.1 above.)

In case of 2.1.2 &2.1.3 above, indenting department shall make endeavour to draw

adequate number of prospective bidders (minimum Six) to ensure competition.

Further, indenting department will obtain approval of Competent Authority (HOD not

below the level of GM) for the same and this will be treated as enlistment of bidders

for a period of 2 Years unless the list is reviewed by indenting department prior to

2 Years period for addition/deletion of name of bidders (s). In case approving

authority is at the level of Director and above, approval shall be obtained from


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Director.

After the enlistment process as mentioned above, QCBS/QBS/LCS methods shall

be followed.

2.2. Once the process of enlistment is over, further process for award shall be made as

under:

a) Preparation of cost estimate and budget

b) Preparation of Terms of Reference (TOR)

c) Preparation and Issuance of the request for Proposals (RFP) to enlisted bidders

which should include

– Letter of Invitation

– Instruction to Consultants

– TOR

– Proposed Draft Contracts

d) Receipt and opening of Proposals

e) Evaluation of Technical Proposals, Consideration of quality

f) Opening of Financial proposals

g) Evaluation of financial proposal

h) Final evaluation of quality and cost

i) Negotiation and Award

2.3. TERMS OF REFERENCE (TOR)

The concerned deptt. shall be responsible for preparing the TOR for the

assignment. TOR shall be prepared by person(s) or a firm specialized in the area

of the assignment. The scope of the services described in the TOR shall be

compatible with the available budget. TOR shall define clearly the objectives, goals,

and scope of the assignment and provide background information (including a list

of existing relevant studies and basic data) to facilitate the consultants’ preparation

of their proposals. If transfer of knowledge or training is an objective, it should be

specifically outlined along with details of number of staff to be trained, and so forth,

to enable consultant to estimate the required resources. TOR shall list the services

and surveys necessary to carry out the assignment and the expected outputs (for


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example, reports, data, maps, surveys). However, TOR should not be too detailed

and inflexible, so that competing consultants may propose their own methodology

and staffing. Firms (bidders) shall be encouraged to comment on the TOR in their

proposals. The PLL’s and Consultants’ respective responsibilities should be clearly

defined in the TOR.

The TOR of the consultant provides a broad outline of the services the consultant

is required to perform. They should normally include the following:

a) background information

b) a statement of objectives

c) a precise scope of work

d) the nature, experience & no. of key personnel to be deployed

e) the indicative work plan

f) schedule for completion of each task

g) the inputs to be provided by PLL

h) the final outputs or deliverables required from the consultant.

The TOR should be clear and precise since the performance of a consultant would

necessarily have to be measured in terms of the agreed TOR. Clarity in the TOR is

essential for ensuring that the consultants have a good understanding of the aims

and objectives of PLL and the relevance of their consultancy.

In the event that, PLL requires a consultant firm for advising on a no. of projects

with a similar TOR, a cluster of projects could be combined into a package and a

single consultant can be selected for the same.

2.4. COST ESTIMATE (BUDGET)

Preparation of a well-through cost estimate is essential if realistic budgetary

resources are to be earmarked. The cost estimate prepared by the concerned

department shall be based on the assessment of the resources needed to carry out

the assignment: staff time, logical support, physical inputs, market feedback etc.

Cost may be divided into broad categories such as (a) fee or remuneration

[according to the type of contract used] (b) reimbursable and (c) taxes and duties,

and further divided into foreign and local costs. The cost of staff time shall be

estimated on realistic basis for foreign and national personnel.


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PREPERATION AND ISSUANCE OF THE REQUEST FOR PROPOSALS (RFP)

2.5. Pre-tender meeting: wherever the concerned department wishes to obtain inputs

from the prospective consultants for finalization of TOR, they may organize pre-

tender meeting and finalize TOR prior to issuance of Request for Proposal (RFP).

2.6. Pre-bid meeting: Pre-bid meetings play an important role in clarifying the

applicants’ doubts with the view to enabling clear understanding of the TOR and

the conditions of the contract. If concerned department decides to make changes

in the terms/scope as a result of pre-bid meetings or otherwise, a formal

corrigendum should be issued and reasonable time should be provided to the

applicant firms to submit their bids.

2.7. The RFP shall include (a) a Letter of Invitation, (b) Information to Consultants, (c)

the TOR, and (d) the proposed contract. The concerned deptts. can use the

applicable standard RFPs as per C&P Procedures with minimal changes, as

necessary to address specific conditions. The deptt. shall list all the documents

included in the RFP. The deptt. may use an electronic system to distribute the RFP,

provided the adequacy of such system is ensured.

LETTER OF INVITATION (LOI)

2.8. The RFP shall contain LOI which shall state PLL’s intention to enter into a contract

for the provision of consulting services and the date, time and address for

submission of proposals as per C&P Procedure.

INSTRUCTION TO CONSULTANTS (ITC)

2.9. The ITC shall contain all necessary information that would help consultants prepare

responsive proposals, and shall bring as much transparency as possible to the

selection procedure by providing information on the evaluation process and by

indicating the evaluation criteria and factors and their respective weights and the

minimum passing quality score. Consultants shall be free to prepare their own

estimates of staff time to carry out the assignment and to offer the corresponding

cost in the proposals. The ITC shall specify the proposal validity period, which

should be adequate for the evaluation of proposals, decision on award and

finalization of contract negotiations. For detail list of the information that should be

included in the ITC, C&P Procedures on “INSTRUCTION TO BIDDERS” may be

followed.


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EMD/ BID BOND, PBG/ SD AND PRS

2.10. For selection of consultants, EMD/ BID Bond and PBG/ SD shall not be applicable.

Further depending upon nature of assignment/ service to be provided by the

Consultant, the Price Reduction schedule clause may not be applicable in certain

cases e.g. in case of appointment of rating agency, auditors and cases where the

performance of the consultant depends to a large extent on the information, details

and regular feedback to be given back by PLL to the Consultant to complete the

assignment etc. The decision regarding applicability/non- applicability of PRS

clause shall be taken by concerned department keeping in view the requirements

of the particular assignment and will be suitably incorporated in the tender.

DRAFT CONTRACT

2.11. A draft contract format as applicable to the specific assignment is to be attached

with the RFP. If necessary, the standard “General Conditions of Contract” (GCC)

and “Special Conditions of Contract” (SCC) both may be attached.

Where the nature of the assignment is not very complex, PLL may enter into a

simple contract as may suffice to capture the broad contours of the assignment.

RECEIPT OF PROPOSALS:

2.12. This is same as PLL’s standard C&P Procedures. Enough time is to be given to

enable the Consultants to prepare and submit their proposals. The time allowed

shall depend on the assignment, but normally shall not be less than two weeks or

more than six weeks. However, depending upon the exigencies, a shorter period

may be allowed with the approval of Competent Authority and rigorous follow up is

to be made to ensure adequate competition. During the interval, the firms may

request clarifications about the information provided in the RFP. PLL shall provide

the clarifications in writing and copy them to all firms on the short list (who intend to

submit proposals). The technical and financial proposals shall be submitted at the

same time. No amendments to the technical or financial proposal shall be accepted

after the deadline. To safeguard the integrity of the process, the technical and

financial proposals shall be sealed in two separate envelopes and both the

envelopes will be put in a larger envelope for submission. The technical envelopes


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shall be opened by a committee of officials drawn from the relevant departments

(technical, finance, C&P as appropriate), after the closing time for submission of

proposal. The financial proposals shall remain sealed. Any proposal received after

the closing time for submission of the proposals shall be returned unopened.

EVALUATION OF PROPOSALS: CONSIDERATION OF QUANTITY AND COST

2.13. The evaluation of the proposals shall be carried out in two stages; first the quality,

and then the cost. Evaluators of Technical Proposal shall not have access to the

Financial Proposal, Financial proposals of acceptable bidders shall be opened only

after carrying out the technical evaluation in full conformity with the provisions of

the RFP.

All the bidders/firms are required to submit Integrity Pact duly signed by them along

with their proposals for tenders having estimated value of Rs 1 Crore and above.

However, PMCs are required to submit Integrity pact irrespective of the value of the

tender

EVALUATION OF THE QUALITY

2.14. The concerned departments shall evaluate each technical proposal taking in to

account several criteria but not limited to: (a) the consultant’s relevant experiences

for the assignments (the minimum experience to be specified in the tender as

provided by the concerned deptt.) (b) the quality of the methodology proposed (c)

the qualifications of the key staff proposed (the key personnel should be regular

employee of the Consultant on their payroll or full time employee) and (d) transfer

of knowledge, if required in the TOR. Each criteria shall be marked on a scale of 1

to 10. Then the total points shall be weighted to become scores. The following

points and the criterion are indicative:

Consultants Specific Experience : Maximum upto 20 Points

Methodology : Maximum upto 20 points

Key Personnel : Maximum upto 50 Points

Transfer of Knowledge/Training : Maximum upto 10 points

(if reqd.)

Total : 100 Points


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In case, transfer of knowledge and/or training is not applicable, the points towards

the same are to be suitably distributed amongst other parameters to make a total

of 100 points.

However, depending upon the complexity/critically and the requirement of the

assignment, the concerned department may add or delete any criteria and allocate

the requisite points against each of the criterion. The actual percentage figures to

be used shall fit the specific assignment.

The ratio of weight towards quality and cost shall normally be 80:20. However, the

concerned department may change it suitably keeping in view the

complexity/criticality of the assignment in question.

The concerned deptt. shall obtain approval of the proposed criteria and allocation

of the points against each criterion from the Competent Authority and the same shall

be disclosed in the RFP including a minimum of total Technical points to be scored

(75%) to qualify for opening of financial proposal. However, where the Competent

Authority for award of Job is Director and above, such approval shall be sought from

the Director concerned.

2.15. The concerned deptt. may divide these criteria in to sub criteria. For example, sub-

criteria under methodology might be innovation and level of detail. However, the

number of sub criteria should be kept to the essential. The use of exceedingly

detailed list of sub-criteria that may render the evaluation a mechanical exercise

more than a professional assessment of the proposals is not recommended. The

weight given to experience can be relatively modest, since this criterion has already

been taken into account when shortlisting the consultant. More weight shall be given

to methodology in the case of more complex assignments (for example

multidisciplinary feasibility or management studies)

2.16. Evaluation of only the key personnel is recommended. The key personnel should

be regular employee of the Consultant on their payroll or full time employee. Since

Key personnel ultimately determine the quality of performance, more weight must

be assigned to this criterion if the proposed assignment is complex and/or personal

appearance is critical/vital. The concerned deptt. shall review the qualifications and

experience of proposed key personnel in their curricula-vitae, which must be


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accurate, complete, and signed by an authorized official of the consulting firm and

the individual proposed.

The individuals may generally be rated in the following sub-criteria as relevant to

the tasks:

(a) General qualifications: general education and training, length of experience

positions held, time with the consulting firm as staff and so forth.

(b) Adequacy for assignment: education, training and experience in the specific sector,

field, subject and so forth, relevant to the particular assignment; and

(c) Experience in the region: knowledge of the local language, culture, administrative

system, Government organizations, and so forth.

2.17. The technical evaluation of the proposal shall normally be done by 3 persons of the

concerned deptt. Independently who will give technical score on the basis of its

responsiveness to the TOR and the average score shall be considered for

evaluation. However, in case of non-availability of 3 technical persons, the technical

evaluation shall be done by lesser no. of person (preferably more than one person).

A proposal shall be considered unsuitable and shall be rejected at this stage if it

does not respond to important aspects of the TOR or it fails to achieve a minimum

technical score (75%), to be specified in the RFP. In case of vide difference in

technical score of the members (i.e. beyond plus /minus 25% of the average score),

all the members will be asked to review the same.

2.18. At the end of the process, the concerned deptt. shall prepare a Technical

Evaluation Report of the ' quality" of the proposals. All records relating to the

evaluation, such as individual mark sheets, shall be retained until completion of the

project and its audit. The Technical Evaluation Report shall be passed on to the

Tender Committee.

EVALUATION OF COST

2.19. After the evaluation of quality is completed, the concerned deptt. shall notify those

consultants whose proposals did not meet the minimum qualifying mark or were

considered non- responsive to the RFP and TOR and the financial proposals of

such bidders will be returned unopened after the signature of the contract.

The concerned deptt. shall simultaneously notify the consultants that have secured


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the minimum qualifying mark , the date , time and place set for opening the financial

proposals. Reasonable time will be given to enable the Consultants to attend the

opening of the financial proposals.

2.20. In case of domestic bidding, the prices are to be quoted in Indian rupees only.

However , in case of International competitive Bidding , for the purpose of

comparison and award , the prices quoted in foreign currency shall be converted to

a single currency i.e. INR. In line with C&P procedure, the declared rate of exchange

(Bills selling rate of State Bank of India) one day prior to the due date of opening of

bids shall be considered, for conversion purpose. The Tender committee shall then

review the financial Proposals.

2.21. Tender document shall specify the taxes and duties to be considered or not to be

considered for evaluation and award purpose. The cost shall include all consultant's

remuneration and other expenses such as travel, translation, report printing, or

secretarial expenses.

The proposal with the lowest cost (Fm) shall be given financial score (Sf) of 100

points. The financial scores of other proposals should be computed as follows;

Sf = 100 x Fm / F

Where F= amount of financial proposal

The methodology to be used shall be described in the RFP.

COMBINED QUALITY AND COST EVALUATION

2.22. The total score shall be obtained by weighting the combined quality / technical and

cost scores and adding them , as follows;

S=St x Tw + Sf x Fw

where

S = total score

St=combined technical score

Sf=combined financial score

Tw=weight assigned to technical score i.e. 0.8

Fw= weight assigned to financial score i.e. 0.2


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For example if the combined technical score is 80, financial score is 90, then the

total score (S) works out to

S= 80x0.8 + 90 x 0.2 = 82

Generally, the successful applicant shall be the applicant having the highest

technical score. In the event two or more proposal have the same scores in the final

ranking, the proposal with the higher total score should be ranked first.

The weight of the “cost “shall be chosen, taking into account the complexity of the

assignment and the relative importance of quality. The weight for cost shall normally

be 20 points out of a total score of 100. The proposed weight age for quality and

cost shall be specified in the RFP. The firm obtaining the highest total score shall

be invited for negotiations.

NEGOTIATIONS AND AWARD OF CONTRACT

2.23. It may be pertinent to mention that negotiations is not permitted However, in the

case of selection of Consultants, negotiation with the first ranked bidder is an

Industry Practice and may be done in a limited manner as described hereinafter.

2.24. Negotiation is not desirable in the process of selection of consultant. However, if

considered necessary with reasons to be recorded, a negotiation which shall

include discussion in respect of TOR, methodology, staffing, employers input and

special conditions of contract may be held with the first rank bidder. Such

discussions should not change the substance of the bid including original scope of

work/ services. The final TOR and the agreed methodology shall be incorporated in

“Description of Services" which shall form part of the contract.

This negotiation shall not include negotiation of prices which form part of financial

evaluation.

If the negotiation with the selected Consultant fail, the employer shall cancel the

bidding process and re-invite the bids.

2.25. The selected firm should not be allowed to substitute key staff, unless both parties

agree that undue delay in the selection process makes such substitution

unavoidable or that such changes are critical to meet the objectives of the


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assignment. If this is not the case and if it is established that the key staff were

included in the proposal without confirming their availability, the firm may be

disqualified. The key staff proposed for substitution shall have qualifications and

experience equal to or better than the key staff initially proposed. During execution

of the assignment, if for unavoidable reasons, the consultant proposes for

substitution of key personal, the same may be allowed by the client with the

approval of competent authority without any prejudice to the completion period.

However in such a situation also, the key staff proposed for substitution shall have

qualification and experience equal or better than the key staff earlier working for the

assignment.

2.26. Negotiations shall also include clarification of the consultants 'tax liability (if any)

and how this tax liability has been or would be reflected in the contract. As Lump-

sum Contracts Payments are based on delivery or outputs for products, the offered

price shall include all costs (staff time, overhead, travel, hotel, etc.). Consequently,

if the selection method for a lump-sum contract include price as a component, this

price shall not be negotiated. In the case of time based Contract, payment is based

on inputs (Staff time, and reimbursable) and the offered price shall include staff

rates and an estimation of the amount of reimbursable. When the selection method

includes price as a component negotiations of staff rates should not take place,

except in special circumstances, for example, staff rates offered are much higher

than typically charged rates by consultants for similar contracts. Consequently, the

prohibition of negotiation does not preclude the right of the PLL to ask for

clarifications and, if fee are very high, to ask for reduction of fees. Reimbursable are

to be paid in actual expenses incurred at cost upon presentation of receipts and

therefore are not subject to negotiations. However, whenever it is considered

essential to define ceilings for unit prices of certain reimbursable (like travel or hotel

rates), the maximum levels of those rates should be indicated in the RFP or a per

diem to be defined in the RFP.

3. OTHER METHOD OF SELECTION

QUALITY BASED SELECTION (QBS)


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3.1. QBS is appropriate for the following types of assignments:-

a) Complex or highly specialized assignments for which it is difficult to define precise

TOR and the required inputs from the consultants and for which client expects the

Consultant to demonstrate high level of innovation in their proposal (Reforms,

Sectoral Studies, Country Studies, Due diligence etc.).

b) Assignments having high downstream impact and in which the objective is to have

the best experts (Feasibility studies, Policy studies of national significance,

Management Studies).

c) Assignment that can be carried out in substantially different ways such that

proposals cannot be comparable such as

- Management consultancy

- Sector & policy studies in which the value of services depend on the quality of

analysis.

3.2. The procedure as mentioned at clause 2.1 to 2.12 (as applicable) under QCBS shall

also be followed in QBS.

In QBS, the RFP shall request submission of both technical and financial proposals

under single stage two envelope system. The RFP shall provide either the

estimated budget or the estimated number of key staff time specifying that this

information is given as an indication only and that consultant shall be free to

propose their own estimates.

3.3. After evaluation the technical proposals using the same methodology as in QCBS,

the price proposal of only the selected firm (who has secured first rank in technical

evaluation. The concerned deptt. And the consultant shall then negotiate and

finalize the contract. The negotiation shall not include negotiation of prices. All other

aspects of the selection process shall be identical to those of QCBS. The unopened

financial proposals of the rest of the bidders shall be returned, after the negotiations

are successfully concluded.

3.4. LEAST COST SELECTION (LCS)

3.4.1. This Method is only appropriate for selecting consultants for assignments of a

standard or routine nature (engineering design of noncomplex works, PMCs,


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Inspection Agencies and so forth) where well - established practices and standards

exists. Under this method, a “minimum" qualifying mark for the “quality" will be

established using the similar methodology as in QCBS. The minimum qualifying

mark (75%) shall be stated in the RFP. Proposals to be submitted in two envelopes,

are invited from a short list. Technical proposals are opened first and evaluated.

Those securing less than the minimum qualifying mark are rejected, and the

financial proposals of the rest are opened. The firm with the lowest price shall then

be selected.

3.4.2. The procedures as mentioned at clauses 2.1 to 2.12 (as applicable) under QCBS

shall also be followed in LCS.

3.4.3. Exceptions :

In case of one time / non-repetitive assignments which are simple and / or not of

complex / strategic in nature, any of the following procedures may be followed:

a) To seek proposal from the short listed bidders without any BEC/ credentials,

evaluate them based on compliance to scope of services and terms & conditions,

opening of prices of acceptable bidders and award of job to the lowest evaluated

bidder.

b) To seek proposal from the prospective bidders with BEC like normal tenders,

evaluate them based on compliance to BEC, scope of award and terms &

conditions, opening of prices of acceptable bidders and award of job to the lowest

evaluated bidder.

SINGLE SOURCE SELECTION (SSS) / NOMINATION

3.5. Single-source selection or nomination of consultants does not provide the benefits

of competition in regard to quality and cost, lack transparency in selection, and

could encourage unacceptable practices. Selection on nomination basis, sought to

be justified on the plea of emergent situation, apparently on account of delay in

timely action for floating of tenders, should be void and tendering procedure should

be followed to invite competitive bidding basis as per procedure so as to give fair

and equal opportunity to all. Therefore, award of contract of SSS / Nomination basis

should be resorted to only exceptional cases and powers to award contracts on

nomination basis should be exercised judiciously with proper and valid justifications


147

in the context of the overall interest of the proposed assignment and duly supported

by reasonableness of rates / prices, which should be recorded in writing.

3.6. Single – source selection may be appropriate only if it presents a clear advantage

over competition (a) for tasks that represent a natural continuation of previous work

carried out by the firm (b) in emergency cases, such as in response to disasters

and for consulting services required during the period of time immediately following

the emergency, (c) for very small assignments (d) when only one firm is qualified or

has experience of exceptional worth for the assignment (e) when consultancy

needed is of specific nature from a person or firm of exceptional/ reputed standing

(f) when time is of essence e.g. to participate in bidding for Domestic / International

projects (g) when reputed consultant is to be selected who do not participate in the

competitive bidding process as a matter of their policy.

3.7. When continuity for downstream work is essential, the initial RFP shall outline this

prospect, and, if practical, the factors used for the selection of the consultant shall

take the likelihood of continuation into account. Continuity in the technical approach,

experience acquired, and continued professional liability of the same consultant

may make continuation with the initial consultant preferable to a new competition

subject to satisfactory performance in the initial assignment.

3.8. If the assignment was not awarded on a competitive basis or if the downstream

assignment is substantially larger in value, a competitive process shall normally be

followed in which the consultant carrying out the initial work is not excluded from

consideration if it expresses interest.

3.9. PROCEDURE FOR SELECRION OF CONSULTANT ON NOMINATION BASIS

3.9.1. The proposal for procurement on nomination basis shall be prepared by the

concerned department for financial concurrence (if required) and Approval for

proceeding on nomination basis of an authority defined below.


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3.9.2. The concerned department shall put up a Complete Proposal / EPC note (if

applicable) for approval by the Competent Authority (CA) as per DoA. The proposal

inter-alia shall include:

i) Justification of the proposed methodology for award, if the justification provided is

solely for the reason of time criticality, then it must be explained as to why the action

could not have been taken sufficiently in advance and placement of order achieved

as per normal tendering process.

ii) Reasons for selection of the single nominated Consultant. The proposal should also

give details of past experiences and references including other credentials about

the capability of such an agency for consultancy.

iii) Price reasonableness of the proposed award including the basis of estimation of

cost. If the cost estimate is based only on budgetary quotation received from the

proposed bidder, then an analysis shall be made by the concerned department of

the adequacy of the same.

iv) A detailed scope of services and deliverables. Time Schedule of such activities and

payment mechanism as is anticipated for the same.

v) Any other documents, details and data in support of the proposal.

Checklist for preparation of proposal for administrative approval:

- Reasons for award on nomination basis.

- Reasons for selecting particular consultant


- Proposal in compete proposal format

3.9.3. The proposal as indicated above shall be put up to the Competent Authority through

the HOD.

3.9.4. In such cases, it is anticipated that the concerned department has already carried

out necessary assessment of capability of Consultants along with their suitability /

credibility assessment.

3.9.5. SR for processing the case for award on nomination basis will be placed on C&P

deptt. by user departments.


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3.9.6. On receipt of PR/SR from Indenting department, C&P department will issue RFQ

on single bid (single envelope system) preferably through e-mail. This RFQ will

include Scope, delivery / completion schedule and other terms and conditions.

Receipt of bid and evaluation will be done as per the normal C&P procedure. It

would be the responsibility of the User Department to establish price

reasonableness of the bid. After Approval of the Competent Authority as per DoA,

C&P department will place the Order.

3.10. Assignment based selection: Depending upon the complexity of the assignment,

need etc., the various methods of selection like QCBS, QBS, LCS, SSS etc.) Shall

suitably be decided by the concerned department. As a matter of convenience, the

methods mentioned against the assignments (which are indicative only) may be

followed however, it is up to the concerned department to decide in this regard:

Departments Name of assignment Method of

selection

Marketing Market Research, Demand Analysis /

Forecast, Pricing, Long Term Strategies

etc.

QCBS

Finance Lead Arranger / Merchant Banker, Pricing,

Valuation Experts, Financial Advisor,

Project Appraisal, Tax / Legal Consultants,

Legal Registrars, Trustees, Rating Agency,

Auditor, Accountants etc.

QCBS / LCS

HR Management Consultant, Training

Consultants, organizational Restructuring,

Recruitment Consultants etc.

QCBS / QBS

Business

Development

Feasibility Report, Due diligence,

transaction Advisor, Merger & Acquisition,

Business opportunities etc.

QCBS / LCS

Project

Development

Feasibility Reports, Legal & Financial

appraisal etc.

QCBS / LCS


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Corporate

Planning

Management Consultants, Performance

Management System, Environment

Scanning Analysis, Strategic Planning /

Restructuring etc.

QCBS / QBS

Corporate

Communications

Media relations, Internal Communication

Strategy, Branding Strategy and Research

etc.

QCBS / QBS

Corporate Social

Responsibility

Empanelment of NGOs /CSOs and

prescribing Accrediting Norms, Consultant

for conducting Need Identification and

impact assessment studies etc.

QCBS / LCS

Projects Project Management Consultants (PMCs),

Inspection Agents etc.

LCS

O&M Specific studies for maintaining integrity of

Process Plants and other operating

facilities, Metering Audit, Benchmarking

Study, Third Party Inspections,

Conceptualization Study etc.

LCS

Law Due diligence for big projects QCBS

C&P Stores / Inventory Management, Disposal

etc.

QCBS / LCS

a) The assignments under Projects in the table shall also include Architects.

b) The indicative methods of selection for Projects and O&M in the table shall be QCBS

/ LCS. However, it is up to the concerned department to decide in this regard.

c) *Action for appointment of TPIA is taken on time so that TPIA (wherever considered

necessary for job/ works) is appointed before award of the jobs/ works.

3.11 Professional liability:

The following shall be mentioned in the ITB of all the consultancy tenders:

“The Consultant is expected to carry out its assignment with due diligence and in

accordance with prevailing standards of the profession”.


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4. TYPES OF CONTRACT AND IMPORTANT PROVISIONS

TYPES OF CONTRACT

4.1 Lump sum Contract : Lump sum contracts are used mainly for assignments in

which the content and the duration of the services and the required output of

the consultants are clearly defined. They are widely used for simple planning and

feasibility studies, environmental studies, detailed design of standard or common

structures, preparation of data processing systems, and so forth. Payments are

lined to outputs (deliverables), such as reports, drawings, bills of quantities, bidding

documents, and software programs. Lump sum contracts are easy to administer

because payments are due to clearly specified outputs.

4.2 Time Based Contract: This type of contract is appropriate when it is difficult to define

the scope and the length of services, either because the services are related to

activities by other for which the completion period may vary or because the input of

the consultants required to attain the objectives of the assignment is difficult to

assess. This type of contract is widely used for complex studies, supervision of

construction, advisory services, and most training assignments. Payments are

based on agreed hourly daily, weekly, or monthly rates for staff (who are normally

named in the contract) and on reimbursable items using actual expenses and/ or

agreed unit prices. The rates for staff include salary, overhead, Fee (or profit), and,

where appropriate, special allowances. This type of contract shall include a

maximum amount of total payments to be made to the consultants. This ceiling

amount should include a contingency allowance for unforeseen work and duration,

and provision for price adjustments, where appropriate. Time-based contract need

to be closely monitored and administered to ensure that the assignment is

progressing satisfactorily and that payments claimed by the consultants are

appropriate.

4.3 Retainer and/or Contingency (Success) Fee Contract: Retainer and contingency

fee contracts are widely used where consultants (banks or financial firms) are

preparing companies for sales or mergers of firms, notably in privatization

operations. The remuneration of the consultant includes a retainer and a success

fee, the latter being normally expressed as a percentage of the sale price of the

assets.


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4.4 Percentage Contract: These contracts are commonly used for Civil Construction

architectural services. They may be also used for procurement and inspection

agents. Percentage contracts directly relate the fees paid to the consultant to the

estimated or actual project construction cost, or the cost of the goods procured or

inspected. The contracts are negotiated on the basis of market norms for the

services and/or estimated staff-month costs for the services, or connectivity bid. It

should be borne in mind that in the case of architectural or engineering services,

percentage contracts implicitly lack incentive for economic design and are hence

discouraged. Therefore, the use of such a contract for architectural services is

recommended only if it is based on a fixed target cost and covers precisely defined

services.

4.5 Indefinite Delivery Contract (Price Agreement): These contracts are used when the

deptt need to have “on call” specialized services to provide advice on a particular

activity, the extent and timing of which cannot be defined in advance. These are

commonly used to retain “advisers” for implementation of complex projects, expert

adjudicators for dispute resolution panels, institutional reforms, procurement

advice, technical troubleshooting, and so forth, normally for a period of a year or

more. The client and the firm agree on the unit rates to be paid for the experts, and

payments are made on the basis of the time actually used.

IMPORTANT PROVISIONS

4.6 Currency: RFPs shall clearly state that firms may express the price for their

services, in any fully convertible currency and/or Indian Rupees. If the consultants

wish to express the price as a sum of amounts in different foreign currencies, they

may do so, provided the proposal includes not more than three foreign currencies.

Payment under the contract shall be made in the currency or currencies in which

the price is expressed in the proposal.

4.7 Price Adjustment: To adjust the remuneration for foreign and or local inflation, a

price adjustment provision may be included in the contract if this duration is

expected to exceed 18 months. Contracts of shorter duration may include a

provision for price adjustment when local or foreign inflation is expected to be high

and unpredictable.


153

4.8 Payment Provisions: Payment provisions, including amounts to be paid, schedule

of payment, and payment procedure, shall be agreed upon during negotiations.

Payments may be made at regular intervals (as under time-based contracts) or for

agreed outputs (as under lump sum contracts). Payments for advances be backed

by advance payment securities.

4.9 Payments shall be made promptly in accordance with the contract provisions. To

that end.

a) only disputed amounts may be withheld, with the remainder of the invoice paid in

accordance with the contract; and

b) the contract shall provide for the payment of interest if payment is delayed due to

the client’s fault beyond the time allowed in the contract; the interest rate shall be

specified in the contract.

4.10 Bid and Performance Securities: Bid and performance securities are not

recommended for consultants’ services. Their enforcement is often subject to

judgement calls, they can be easily abused, and they tend to increase the costs to

the consulting industry without evident benefits, which are eventually passed on to

the client.

4.11 Client’s/ PLL’s Contribution: PLL/concerned deptt may assign members of its own

professional staff to the assignment in different capacities. The contract between

the PLL and the consultant shall give the details governing such staff, known as

counterpart staff, as well as facilities that shall be provided such as housing, office

space, secretarial support, utilities, materials, and vehicles. The contract shall

indicate measures the consultant can take if any of the items cannot be provided or

have to be withdrawn during the assignment, and the compensation the consultant

will receive in such a case.

4.12 Conflict of Interest: the consultant shall not receive any remuneration in connection

with the assignment except as provided in the contract. The consultant and its

affiliates shall not engage in consulting or other activities that conflict with the

interest of PLL under the contract. The contract shall include provisions limiting

future engagement of the consultant for other services resulting from or directly

related to the firm’s consulting services.


154

4.13 Staff Substitution: During an assignment, if substitution is necessary for example,

because of ill health or because a staff member proves to be unsuitable), the

consultant shall propose other staff of at least the same level of qualifications for

approval by the concerned deptt.

4.14 Applicable Law and Settlement of Disputes: The contract shall include provisions

dealing with the applicable law and the forum for the settlement of disputes.

Consultant’s contract shall always include a clause for settlement of disputes.

5. BID EVALUATION CRITEREA (BEC)

5.1 For shortlisting of bidders or invitation of tenders (for unforeseen/ non-repetitive

jobs) with BEC, a suitable technical criteria (for all cases) and financial criteria (for

assignments having estimated value of more that Rs. 50 lacs) is to be formulated

for approval of the Competent Authority. However, where the Competent Authority

for placement of order is MD & CEO and above, such approval shall be sought from

the MD & CEO.

5.2 The criteria so approved will be incorporated in the invitation document. The

purpose of such criteria is to establish the capability of the prospective bidders in

being able to execute the order strictly incompliance with PLL’s requirements.

5.3 The Eligibility or capability is assessed in relation to the technical competence

judged based on the similar past experience as submitted in regard thereto.

Further, financial soundness is ascertained through scrutiny of financial documents

such as Annual reports, Balance Sheet and Profit & Loss account towards annual

turnover of the bidder in preceding 3 year’s period.

5.4 The criteria and other relevant tender conditions should be made in such a

manner that the competent bidders participate in the short listing process and/or

invitation of tender and that there is sufficient competition. The criteria should

never be framed keeping in view a particular bidder (s). As far as possible the

criteria should be general in nature meeting the job requirement and ensuring

adequate competition.

5.5 As a general guideline, following may be considered for eligibility assessment: -

5.5.1. Technical Criteria

Depending upon nature of assignment, broad, guidelines for technical criteria shall


155

be as under:

Experience of at least one similar assignment of about 50% of value of assignment

in previous 5 years. However, in case of Rate Contract or assignment of having

more than one year period, experience of at least one similar assignment of about

50% of annualized value of assignment in previous 5 years is to be considered.

“Similar assignment” if specified in the criteria must be clearly defined in the

invitation document.

Alternatively, the criterion of similar assignment experience may not be necessary

to be specified in terms of value, if the experience can be specified in terms of

technical parameters.

5.5.2. Financial Criteria

Financial Criteria mentioned below is to ascertain financial soundness of the

bidders. For assignments having estimated value of more than Rs. 50 lacs, annual

turnover criteria of 50% of the annualized estimated value to be incorporated where

completion period is more than one year and where completion period is less than

one year, 50% of the estimated value is to be considered for annual turnover

criteria.

5.6 The above mentioned criterion are the general guidelines to be considered while

formulating the BEC. The indenting department with due reasoning may suitably

formulate the criteria depending upon the job requirements and the same shall not

be treated as deviation to the procedure. While making the criteria, the prime

objective is that only capable bidder should qualify as it works like filter. At the same

time, there should be sufficient competition.

5.7 The Bids submitted by only such bidders who meet fully the criteria, should be taken

up for detailed evaluation. No. relaxation is permitted for inclusion of any bidder(s)

who do not meet the criteria in entirely, for reasons only to increase the competition.

5.8 A job executed by a bidder for its own in-house purpose/sister concern/subsidiary

cannot be considered as experience for the purpose of meeting BEC.

6. Compliance with procedure

6.1. Compliance with procedure & Powers for Deviations


156

i) The C&P Group will function strictly within the policy guidelines, procedure and such

administrative guidelines as may be prescribed from time to time. In addition to the

procedures mentioned above, the other provisions of C&P procedure for

procurement of goods and services shall apply in the event of conflicting versions,

the provisions of the procedure for Selection of Consultants shall supersede.

ii) Any deviation to this procedure shall require approval of concerned Director.

iii) Any amendment to the procedure shall require approval of MD& CEO.

6.2. Amendments / Explanations / Clarifications to the Procedure / Updation of

Procedure

6.2.1 The policy as described in this procedure may require amendments from time to

time keeping in view the organizational need. Amendments to the procedure will

be issued with the approval of MD&CEO and any such amendments will form an

integral part of the procedure.

6.2.2 During the process of executing various projects some of the provisions as

described herein above may require elaboration or substantiation to achieve more

clarity. Such explanatory/ clarificatory communication will be issued by C&P

department and such communication shall also form an integral part of the

procedure.

6.2.3 When amendments / clarifications have been issued pursuant to the provisions

described above, C&P department shall review, periodically, the need to issue an

updated procedure, after incorporating such amendments / clarifications.

6.2.4 Files containing Tender Committee Recommendations are required to be put up to

the Competent Authority directly for decision and not to be referred to/routed

through C&P Department except cases which are handled by the C&P Department.

However, clarifications relating to the Procedure can always be referred to the C&P

Department and the same shall be promptly responded to. Such clarifications

should be issue based and should be raised separately rather than on the Files

meant for decision making pertaining to a Tender.

6.2.5 Clarifications concerning Delegation of Authority (DoA) should be sought from the

Company Secretary.


157

Annexures: Formats

Annexures-I

Checklist for monitoring of Purchase order/Contract

CDD_______________

PLL Project______________

Consultant__________________________

EDD________________

PO/LOA No.___________ Dated __________ (To be filled when issued)

PR/SR No. ___________ Dated __________ (To be filled when issued)

Name of Item(s)/Job

Order value

Delivery Basis: FOB/CFR/CIF/FOR SITE/ Ex-Works

Sr. No. Check List Target date Action By Details

Status

1 2 3 4 5

1. LOA Acceptance

by Vendor

2. Validity of EMD/Bid

Bond

3. PO/LOA

Acceptance

4. Submission of PBG

5. LC date ( where

ever is applicable

6.

Drawing Approvals

Submission

Approval

7. Sub Vendor details

8. Sub Order Details

9. Fabrication /


158

manufacturing

Schedule

10. Expediting Reports

11.

Inspection

Schedule (Stage

inspection witness

tests etc.)

12. Release date for

dispatch

13. Dispatch details

(whether ODC)

14. Shipping Details

15.

At port of arrival/

customs clearance

by

16. At site

17. Payments Details

18. Dely. Ext. reqd.

19. Reasons

20. PRS ( leviable / not

leviable)

21.

Review of order for

any unforeseen

event/utilities

22. Recommendations

23. Approval required

24. GR No.

25. Warranty /

Guarantee

26. Order Closure

27. PBG Release Date


159

Annexure-II

Post Order Monitoring

(Procurement)

Sr.

no. Item

PO

No.

Ven

dor

PO

val

ue

Dt. Of

PO

acc.

Rec

eipt

of

PBG

Dt. Of

refund

of EMD

LC

no.

& Dt.

Val

ue

of

LC

CDD Actual

Qty. Time

Order

Closure

/ GR

No.

Remark

s /

status


160

Annexure-III

Post order Monitoring

(Contracts)

Sr.

No.

Wor

k

W

o

No

.

Dt

.

Orde

r

value

Dt.

Of

FO

I

Dt.

Of

LO

A

Dt.

Of

LO

A

acc.

Dt. Of

Signing

contract

PB

G

/SD

Dt. Of

Refun

d

Dt.

Of

pay.

of

Adv.

CD

D

Act. Of

completi

on

Time

extensio

n

Orde

r

closu

re

Rem

arks/

statu

s


161

SECTION-V

Appendix-I

METHODOLOGY FOR EVALUATION OF FINANCIAL CRITERIA OF BEC

The detailed methodology consisting of parameter-wise Evaluation Methodology

along with the relevant formats is given hereunder. Theses relevant formats

should be included in the tender document itself.

1. Annual Turnover

Sl. Single

Joint

Ventures/Cons

ortium

Documents

Required Remarks

1.

The turnover of

the Bidder

should be

minimum 50%

of the

annualized

estimated value

of work/supply

tendered for, in

any of the 3

preceding

financial years.

The turnover of

each Partner

should be

minimum 25%

of the

annualized

estimated value

of work/supply

tendered for, in

any of the 3

preceding

financial years.

Leader of the

JV/Consortium

should have

minimum

criteria as

applicable for

bidder under

“single entity”.

Bidder or Each

Partner or the

Bidding Joint

Venture must fill

form as per

Format-A

enclosed.

In case the tenders

having the bid closing

date up to 31st

January of the

relevant financial

year, and audited

financial results of

the immediate 3

preceding financial

years are not

available, the bidder

has an option to

submit the audited

financial results of

the 3 years

immediately prior to

that. Wherever the

closing date of the bid

is after 31st January

of the relevant

financial year, bidder

has to compulsorily


162

submit the audited

financial results for

the immediate 3

preceding financial

years.

2. Net Worth

Sl. Single Entity Joint

Ventures/Con

sortium

Documents

Required

Remarks

1 Net Worth of

the Bidder

should be

positive as per

the last audited

financial

statement.

Net Worth of

each Partner of

the Bidding

Joint Venture/

Consortium

should be

positive as per

the last audited

financial

statement.

Bidder or Each

Partner of the

Bidding Joint

Venture/Conso

rtium must fill

form as per

Format-B

enclosed.

In case the tenders


date up to 31st January

of the relevant financial

year, and audited

financial results of the

immediate preceding

financial year is not

available, in such case

the audited financial

results of the year

immediately prior to that

year will be considered

as last financial year for

Net worth calculation.

Wherever the closing

date of the bid is after

31st January of the

relevant financial year,

bidder has to

compulsorily submit the

audited financial results

for the immediate


163

preceding financial

years.

3. Working Capital

S

l.

Single Entity Joint

Ventures/Consortium

Documents

Required

Remarks

1 Bidder should

have minimum

working capital

equal to 10% of

the annualized

estimated

Leader of Joint

Venture/Consortium

should have minimum

Working capital equal to

10% of the annualized

estimated Contract Value

as per the last audited

financial year. If the

Leader’s working

1) Bidder or Each

Partner of the

Bidding Joint

Venture/Consorti

um must fill form

as per Format-B

enclosed.

2) Bank’s Letter,

if

In case the tenders


date up to 31st January

of the relevant


164

contract value

as per the last

audited

financial year. If

the bidder’s

working capital

is inadequate,

the bidder

should

supplement this

with a Vendor’s

bank, having

net worth not

less than Rs.

100 Crores or

US $ 22 million,

letter confirming

the availability

of line of credit

for at least 10%

of the

annualized

estimate

contract value.

capital is inadequate,

the bidder should

supplement this with a

Leader’s bank, having

net worth not less than

Rs. 100 Crores or US $

22 million, letter

confirming the

availability of line of

credit for at least 10% of

the annualized

estimated contract

value.

required. financial year, and

audited financial

results of the

immediate preceding

financial year is not

available, in such case


results of the year

immediately prior to

that year will be

considered as last

financial year for

Working Capital

calculation.

Wherever the closing

date of the bid is after

31st January of the

relevant financial year,

bidder has to

compulsorily submit


results for the

immediate preceding

financial years.


165

Annual Turnover

(FORMAT-A)

Applicant’s Legal Name: Date:

JV Partner’s Legal Name: TENDER

NO:

Page…………..of……….

Each Bidder must fill in this form (Single Entity)

Annual Turnover data for the last 3 years

Year Currency Amount Ex. Rate(*) Amount(INR)

(*)

Year1:

Year2:

Year3:

Each member of a JV/Consortium must fill in this form (J.V./Consortium)

Annual Turnover data for the last 3 years

Year Currency Amount Ex. Rate(*) Amount(INR)

Leader of

J.V./Consor

tium

Year1:

Year2:

Year3:

Partner A

Year1:

Year2:

Year3:

Partner B

Year1:


166

Year2:

Year3:

Total:

1. The information supplied should be the Annual Turnover of the applicant and each

member of a JV/Consortium.

2. A brief note should be appended describing thereby details of turnover as per

audited results.

Signature of Bidder

(*) To filled by Owner/Consultant


167

FINANCIAL SITUATION

FORMAT -B

Applicant’s Legal Name: Date:

JV Partner’s Legal Name: TENDER No.:

Page…………of……….

Each Bidder or member of a JV/Consortium must fill in this form

FINANCIAL DATA FOR LAST AUDITED FINANCIAL YEAR

Description Year

Amo

unt

Ex. Rate(*) Amount (INR)

(*)

1. Current assets

2. Current Liabilities

3. Working Capital (1-2)

4. Net Worth Owners

funds (Paid up share

capital and Free Reserves

& Surplus)

1. Attached are copies of the audited balance sheets, including all related notes, and

income statement for the last Audited Financial year, as indicated above,

complying with the following conditions:

o All such documents reflect the financial situation of the bidder or partner to a

JV/Consortium, and not sister or parent companies.

o Historic financial statements must be audited by a certified accountant

o Historic financial statements must be complete, including all notes to the financial

statements.

o Historic financial statements must correspond to accounting periods already

completed and audited (no statement for partial periods shall be requested or

accepted)

Signature of Bidder

(*) To be filled by Owner/Consultant


168

APPENDIX – II

(Limited Domestic Tendering upto Rs. 7 Lacs)

PETRONET LNG LIMITED

GENERAL PURCHASE CONDITIONS (GPC)

1. Consignee: C&P In-charge, PLL, (complete address ………………………). Any

expenditure and/or demurrage incurred in respect of a wrong delivery shall be

recovered from supplier.

2. Quotation, duly sealed & super scribed with the tender/enquiry no., bid opening date

and the words ‘QUOTATION – DO NOT OPEN’, should reach this office on or

before 1500 hrs on the due date of opening along with samples, if required, failing

which your offer will not be considered. Quotations received late are liable to be

rejected. A quotation received late by post or other means are liable to be rejected.

PLL reserves the right to accept/reject any or all tenders without assigning any

reason whatsoever.

3. Local Sales Tax and Central Sales Tax/VAT/TIN registration Nos. must be

mentioned in the quotation.

4. Rates should be given according to unit mentioned in NIT and no alternative unit

will be considered. Further, rates should be quoted on FOT dispatch point basis

including P&F and indicating rate of taxes, duties etc. and freight upto Site. Price

shall be written in both words and figures. In the event of difference, the price in

words shall be valid and binding. Unit prices shall be considered correct in the event

of any discrepancy with regard to total price.

5. The offer should remain valid for not less than 3 months from the bid opening date.

Offers with less validity are likely to be ignored.

6. Offers subject to prior sale will not be considered. Further, the standard terms and

conditions of the bidder are not acceptable.

7. Revised offer or post-bid modification of offer after the opening date will not be

considered.

8. The required quantities at the time of placement of order can be changed upto ±

25% of the quantities specified in enquiry.

9. Inspection, Testing & Expediting: Purchaser or its representative shall have the

right to inspect and / or test the goods to confirm their conformity to the contract

specifications. The inspection & tests may be conducted on the premises of the

seller at the point of delivery and / or at the goods final destination. All reasonable


169

facilities & assistance including access to drawings & production data shall be

furnished by seller to purchaser free of cost.

When stores are rejected by the consignee, the same will be intimated to the

supplier with the details of such rejected stores as well as the reason for their

rejections and that the material will be lying at the consignee’s premises at the risk

and cost of supplier. The supplier will also be called upon either to remove the

materials or to give instructions as to their disposal within 14 days and in the case

of dangerous/infested and perishable materials within 48 hrs, failing which the

consignee will either return the materials to the supplier on freight to pay or

otherwise dispose them off at the supplier’s risk and cost. The consignee will also

intimate the concerned paying authority, quantity of the material so rejected so as

to recover the freight charges from the supplier. The purchaser shall also be entitled

to recover handling and stores charges for the period during which the rejected

stores are not removed @ 5% of the stores for each month or part of a month till

the rejected stores are finally disposed off.

10. Warranty :

The supplier shall warrant that everything to be furnished hereunder shall be free

from all defects and faults in material, workmanship and manufacture and shall be

of the highest grade and consistent with the established and generally accepted

standards of the materials of the type offered and in full conformity with the

specifications drawings or samples, if any, and shall if operable, operate, properly.

This warranty shall survive inspection of payment for and acceptance of the goods

but shall expire 12 months from the date of commissioning / operations or 24

months from the date of despatch, whichever is earlier.

11. Payment terms:

100% Payment will be released within 15 days of receipt and acceptance of

material/installation at site/stores through e-banking. In case of payment through

bank, all bank charges shall be borne by the vendor.

12. Invoice:

In case where documents are not routed through Bank, original plus one copy of

invoice may be directly sent to In-charge (F&A) PLL … immediately after dispatch

with copies to purchaser and the consignee mentioned in purchase order. Invoice

must bear the purchase order no. with date and should also indicate the dispatch


170

particulars. It may be noted that the documents will be retired only if the dispatches

are made as per the terms of the purchase order.

13. Packing & Marking:

While dispatching ordered stores, it will be the responsibility of the supplier to

properly pack the consignment so as to enable its delivery at destination free from

loss, damage or pilferage. Each packing must contain a list of stores packed therein.

Each packing/bundle must be prominently marked with order no. and packing no.

& consignee name & address.

14. Despatch documents:

Transit Risk Insurance shall be arranged by PLL. The vendor will intimate dispatch

particulars to purchaser through e-mail at the time of dispatch of goods.

The dispatch documents shall consists of Invoice, Challan, Packing List, GR/LR,

inspection/Test Certificate and any other document(s) as mentioned in the P.O.

Copies of dispatch documents should reach PLL well in advance failing which any

demurrage/wharfage etc. incurred on account of late/ non-receipt of dispatch

document/wrong dispatches of consignment will be recovered from supplier. In

case of documents through Bank, it may be noted that the documents will be retired

only if the dispatches are made as per the terms of the purchase order.

15. It should be noted that if an order is placed on a higher tenderer as a result of this

tender, in preference to the lowest acceptable offer, in consideration of an earlier

delivery, the supplier will be liable to pay to PLL the difference between the ordered

rate and the rate quoted by the lowest acceptable tenderer in case he fails to

complete the supply in terms of such order within the date of delivery specified in

the tender and incorporated in the order. This is without prejudice to other rights

under terms of order.

16. Limitation of Liability: Notwithstanding anything contrary contained herein, the

aggregate total liability of the contractor under the agreement or otherwise shall be

limited to 100% of order price. However, neither party shall be liable to the other for

any indirect and consequential damages, loss of profits or loss of production. The

above limitation will not apply in the event of fraud, wilful misconduct, unlawful

activity, breach of applicable law, infringement of IPR, and damage to third party

17. Repeat Order: Purchaser reserves the right within six months of order to place

repeat order up to 50% of ordered quantity.


171

18. Termination of Contract: The PURCHASER may, without prejudice to any other

remedy for breach of contract, by written notice of default sent to the Seller,

terminate the contract in whole or part –

a) If the Seller fails to deliver any or all of the goods within the time period/(s) specified

in Contract; or

b) If the Seller fails to perform any other obligation(s) under the Contract and

c) If the seller, in either of the above circumstances, does not cure his failure within a

period of 30 days (or such longer period as the Purchaser may authorize in writing)

after receipt of the default notice from the Purchaser.

In the event the Purchaser terminates the contract in whole or part, the Purchaser

may procure, upon such terms and in such manner as it deems appropriate, goods

similar to those undelivered and the Seller shall be liable to the Purchaser for any

excess costs for such similar goods. However, the Seller shall continue

performance of the Contract to the extent not terminated.

In case of termination of contract herein set forth except under conditions of FORCE

MAJEURE and on expiry of contract, the vendor shall be put under holiday [i.e.

neither any enquiry will be issued to the party by PLL. against any type of tender

nor their offer will be considered by PLL against any ongoing tender(s) where

contract between PLL and that particular vendor (as a bidder) has not been

finalized.

The Purchaser may at any time, terminate the contract by giving written notice to

the Seller, without compensation to the Seller, if the Seller becomes bankrupt or

otherwise insolvent, provided that such termination will not prejudice or affect any

right of action or remedy which has accrued or will accrue thereafter to the

Purchaser.

19. FORCE MAJEURE : Shall mean and be limited to the following –

(a) War / Hostilities (b)Riot or Civil Commotion (c) Earthquake, flood, tempest,

lighting or other natural disasters (d) Restrictions imposed by the Government or

other statutory bodies which prevents or delays the execution of the Contract by the

Seller

The Seller shall advise Purchaser by a registered letter duly certified by the local

Chamber of Commerce or statutory authorities, the beginning and end of the above

causes of delay within seven (7) days of the occurrence and cessation of such

Force Majeure conditions, In the event of delay lasting over one month, if arising


172

out of causes of Force Majeure, Purchaser reserves the right to cancel the Contract

and the provisions governing termination stated above shall apply. For delays

arising out of Force Majeure, the Seller shall not claim extension in completion date

for a period exceeding the period of delay attributable to the causes of Force

Majeure and neither Purchaser nor Seller shall be liable to pay extra costs provided

it is mutually established that Force Majeure conditions did actually exist. In the

event of any Force Majeure conditions, the Seller or the Purchaser shall not be

liable for delays in performing their obligations under this order and the delivery

dates will be extended to the Seller without being subject to price reduction for

delayed deliveries, as stated elsewhere.

20. Jurisdiction: The Contract/Purchase order / LOA shall be governed by the Laws

of India subject to the jurisdiction of the courts in Delhi.

21. Intellectual Property Rights: Seller shall protect and fully indemnify PLL from any

claim from infringement of patents, copyright, trademark and the like. In case of any

claim in this regard, Seller shall be solely responsible for any

consequences/damages

22. Subsequent to receipt of bids, the information related to the examination,

clarification, evaluation and comparison of bids and recommendations for award of

contract shall not be disclosed to bidder or other person not officially concerned with

such process. Any effort by bidder to influence PLL processing of bid or award

decisions may result in rejection of such bids.

23. The Purchaser requires that Bidders/Suppliers observe the highest standard of

ethics during the procurement and execution of the order. In pursuance of this

policy, the Purchaser:

(i) will reject a proposal for award if it determines that the Bidder recommended for

award has engaged in corrupt or fraudulent practices in competing for the contract

in question;

(ii) will declare a firm ineligible, either indefinitely or for a stated period of time, if at any

time the Purchaser determines that the firm has engaged in corrupt or fraudulent

practices in competing for or in executing a contract.

--------------x-----------------


173

APPENDIX - III

(Domestic OEM/Proprietary)



1. Consignee: C & P In-charge, PLL, (complete address ………………………). Any

expenditure and/or demurrage incurred in respect of a wrong delivery shall be

recovered from supplier.

2. Quotation, duly sealed & super scribed with the tender/enquiry no., bid opening date

and the words ‘QUOTATION – DO NOT OPEN’, should reach this office on or

before the due date of opening along with samples, if required. Quotation may also

be sent through e-mail.

PLL reserves the right to accept/reject the bid without assigning ant reason

whatsoever.

3. Local Sales Tax and Central Sales Tax /VAT /TIN registration Nos. must be

mentioned in the quotation.

4. Rate should be given according to unit mentioned in NIT and no alternative unit will

be considered. Taxes, duties, P&F and freight charges to Site should be indicated

separately. Price shall be written in both words and figures. In the event of

difference, the price in words shall be valid and binding. Unit prices shall be

considered correct in the event of any discrepancy with regard to total price.

5. The offer should remain valid for not less than 3 months from the bid opening date.

6. Offers subject to prior sale will not be considered. Further, the standard terms and

conditions of the bidder are not acceptable.

7. Revised offer/ post-bid modification of offer after the opening date will not be

considered. Further, PLL will not allow any upward revision of prices during the

contract period unless specifically stated in the purchase Order.

The required quantities at the time of placement of order can be changed upto ±


8. Warranty/Guarantee:

Material/spares supplied shall be guaranteed for defect originating from design,

materials, workmanship, operating characteristics etc. for 12 months from date of

commercial operation or 24 months from the date of shipment, whichever is earlier.


174

In case of rejection of goods supplier shall replace/repair the same at no extra cost

to PLL and till such time the rejected goods shall be lying at site at the risk and cost

of supplier.

9. Payment terms:

100% Payment subject to deduction of PRS (if any) will be released within 15 days

of receipt and acceptance of material/installation at site/stores through e-banking.

In case of payment through bank, all bank charges shall be borne by the vendor.

10. Invoice:

In case where documents are not routed through Bank, original plus one copy of

invoice may be directly sent to In-charge (F&A) PLL, immediately after dispatch with

copies to purchaser and the consignee mentioned in purchase order. Invoice must

bear the purchase order no. with date and should also indicate the dispatch

particulars. It may be noted that the documents will be retired only if the dispatches

are made as per the terms of the purchase order.

11. Packing & Marking:






12. Despatch documents:

Transit Risk Insurance shall be arranged by PLL. The vendor will intimate dispatch

particulars to purchaser through e-mail / fax at the time of dispatch of goods.

The dispatch documents shall consists of Invoice, Challan, Packing List, GR/LR,

inspection/Test Certificate and any other document(s) as mentioned in the P.O.

Copies of dispatch documents should reach PLL well in advance failing which any

demurrage/wharfage etc. incurred on account of late/ non-receipt of dispatch

document/wrong dispatches of consignment will be recovered from supplier. In

case of documents through Bank, it may be noted that the documents will be retired

only if the dispatches are made as per the terms of the purchase order.

13. Repeat Order: Purchaser reserves the right within six months of order to place

repeat order up to 50% of ordered quantity



175

a) War / Hostilities (b)Riot or Civil Commotion (c) Earthquake, flood, tempest,



Seller

The Seller shall advise Purchaser/Consultant by a registered letter duly certified by

the local Chamber of Commerce or statutory authorities, the beginning and end of

the above causes of delay within seven (7) days of the occurrence and cessation

of such Force Majeure conditions, In the event of delay lasting over one month, if

arising out of causes of Force Majeure, Purchaser reserves the right to cancel the

Contract and the provisions governing termination stated above shall apply. For

delays arising out of Force Majeure, the Seller shall not claim extension in

completion date for a period exceeding the period of delay attributable to the causes

of Force Majeure and neither Purchaser nor Seller shall be liable to pay extra costs

provided it is mutually established that Force Majeure conditions did actually exist.

Seller shall categorically specify the extent of Force Majeure conditions prevalent

in their works at the time of submitting their bid and whether the same have been

taken into consideration or not in their quotations. In the event of any Force Majeure

conditions, the Seller or the Purchaser shall not be liable for delays in performing

their obligations under this order and the delivery dates will be extended to the

Seller without being subject to price reduction for delayed deliveries, as stated

elsewhere.

15. Jurisdiction. The Contract/Purchase order/LOA shall be governed by the Laws of

India subject to the jurisdiction of the courts in Delhi.

16. Resolution of Disputes / Arbitration: (Arbitration as means of Dispute

Resolution will be applicable in the case of contracts above Rs 2 crore)

All disputes or difference whatsoever that shall at any time arise between the parties

relating to execution of this Contract/Purchase order shall be referred to the Sole

Arbitrator appointed by the mutual consent of the parties. The arbitration shall be

conducted in accordance with the Arbitration Act, 1996 and its Rules as amended

from time to time. The proceedings shall be conducted in Delhi in the English

language. The cost of arbitration proceedings shall be shared equally by the

parties.

17. FALL CLAUSE ( APPLICABLE ONLY FOR MATERIAL PROCUREMENT): The

price charged for the items supplied under the contract by the seller shall in no event


176

exceed the lowest price at which the seller or his Agent/Principal/Dealer, as the

case may be, sells the goods or offer to sell goods of identical description to any

persons/organizations around the world during the currency of the contract.

If at any time during the said contract period, seller or his Agent/Principal/Dealer,

as the case may be, reduces the sale price, sells or offers to sell such goods to any

persons/organizations at a price lower than the price chargeable under the contract,

he shall forthwith notify such reduction or sale or offer of sale to the PLL and the

price payable under the contract for the goods supplied after the date of coming into

force of such reduction or sale or offer of sale stand correspondingly reduced.

However, the above stipulation will not apply to:

a) Exports by the Seller


normal replacement

c) Sale of goods such as drugs which have expiry dates

The Seller shall furnish the following certificate to the concerned paying authority

along with each bill for payment for supplies made against this order.

“I/We certify that there has been no reduction in sale price of the goods of

description identical to the goods supplied to the PLL under the contract herein and

such goods have not been offered/sold by me/us to any person/organization around

the world upto the date of bill/ during the currency of the contract whichever is later,

at a price lower than the price charged to the PLL under the order”.

Such a certificate shall be obtained except for quantity of items/goods/materials

categories under sub clause (a), (b) & (c) above, of which details shall be furnished

by the Seller.





--------------x-----------------


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APPENDIX - IV

(Overseas OEM/Proprietary Items)



1. SCOPE OF SUPPLY

Single point responsibility of the Seller includes but not limited to manufacture,

testing, inspection, packing, forwarding, documentation, inland transportation &

supply on FOB/FCA (Seaport/Airport of exit) or CFR basis. Marine cum Transit

Insurance shall be arranged by PLL.

2. PREPARATION OF BID

The bid prepared by the bidder and all correspondence/drawings and documents

relating to the bid exchanged between bidder and PLL shall be written in English

language, provided that any printed literature furnished by the bidder may be written

in another language so long as it is accompanied by an ENGLISH translation, in

which case, for the purpose of interpretation of the bid the ENGLISH translation

shall govern. Metric measurement system shall be applied.

The tender is non-transferable. Tender shall be acceptable only from the parties to

whom the tender documents were issued.

The bidder shall bear all costs associated with the preparation and submission of

the bid and PLL will, in no case be responsible or liable for these costs, regardless

of conduct or outcome of the bidding process.

3. VALIDITY OF OFFER

The offer should remain valid for not less than 3 months from the bid opening date

4. PRICES

i. The prices (in home currency or in US$/EURO) including FOB charges on FOB

(Sea Port of export) basis quoted by bidder shall be fixed and firm, inclusive of all

taxes and duties up to Port of Exit. Revised offer/ post-bid modification of offer after

the opening date will not be considered. Further, PLL will not allow any upward

revision of prices during the contract period unless specifically stated in the

purchase Order.

ii. The Indian Agent Commission, if any, included in quotation shall be shown

separately in the form of percentage (%) of FOB prices. The Indian Agent

Commission shall be payable directly by PLL to Indian Agent of bidder in Non-


178

convertible Indian Rupees upon complete execution of order and supplies are

received and accepted at site.

iii. Price shall be written in both words and figures. In the event of difference, the price

in words shall be valid and binding. Unit prices shall be considered correct in the

event of any discrepancy with regard to total price.

iv. The required quantities at the time of placement of order can be changed upto ±


5. PAYMENT TERMS

100% direct payment at sight shall be made against presentation of the required

negotiable documents drawn under and in accordance with the terms of the order

through normal banking channels.

In case, the Seller intends to receive payment through Letter of Credit, 100%

payment shall be made through irrevocable & unconfirmed Letter of Credit against

presentation of the shipping documents.

All bank charges outside India shall be to Seller's account and in India to PLL’s

account. If confirmed LC is requested by the Seller, LC confirmation charges

will be borne by seller only.

Any discrepancy in shipping documents/negotiated documents would be the

responsibility of the seller.

6. DELIVERY AND DELAYS

6.1 Contractual Delivery Period & Date

Contractual Delivery period shall be reckoned from the date of notification of award

through Letter of Intent. Date of Bill of Lading or Master Air Way Bill (in case of air-

shipment) shall be considered as delivery date, in case of orders placed on FOB

port of exit basis.

6.2 Non-conformance and Cancellation

If the delivery schedule as per order is not adhered to or the progress of

manufacture or supply of the goods is not satisfactory or not in accordance with the

progress schedule, PLL has right to:

6.3.1 Cancel the Purchase order in whole or in part without liability for cancellation

charges. In such event, PLL may procure goods from elsewhere at the risk & cost

of the Seller.

6.3.2 In the event of non-conformance of goods, Seller shall be allowed, without any

extension of delivery time, to rectify the non-conformities. Should, however, seller


179

fail to do so within the stipulated time, the PLL may cancel the order as to the non-

conforming goods and retain the rights with respect to substitution and in addition

recover actual expenses incurred by the PLL in installing and removing the non-

conforming goods. Alternatively, PLL may at his option have or cause the non-

conforming to be rectified at seller’s risk & cost. The PLL also deserves the right to

claim damages for use of defective or substandard goods supplied by the seller

irrespective of the fact whether goods were inspected prior to receipt at site by the

PLL or not.

7. CERTIFICATE OF CONFORMITY

The seller shall provide certificate of conformity strictly as per proforma enclosed in

the tender. This certificate will be an integral part of shipping documents.

8. SELLER'S SALE CONDITIONS

Seller’s standard sale conditions are not acceptable to PLL and seller's are

requested not to incorporate the same in their quotation. Further, offers subject to

prior sale will not be considered.

9. WARRANTY/GUARANTEE

Material supplied against this tender shall be guaranteed against any defects from

design, materials, workmanship, operating characteristics etc. for a period of 12

months from the date of operation or 18 months from the date of shipment,

whichever is earlier.

In case of rejection of material due to non-conformity to specifications in the tender

/ Certificate of Analysis issued by seller, the entire material shall be replaced by the

seller free of cost including all expenses paid on “Free of Charge” to PLL on DPP

(Delivered Duty paid), Mumbai basis.

10. INSPECTION:

The materials are to be inspected throughout the phases of production from raw

materials to finished product by your works inspectors. Shipping documents in

respect of each consignment should be accompanied by a certificate issued by

works inspector indicating the tests conducted with results thereof as required under

the relevant specification and also certifying that the materials conform to the

specification as indicated in the purchase order.

11. PART ORDER

PLL, at its discretion, may finalize order on bidder(s) for any or all items of the

enquiry.


180

12. REPEAT ORDER

PLL reserves the right, within 6 months of order to place repeat order up to 50% of

the ordered quantity without any change in unit price and other terms & conditions.

13. PLL’S RIGHT TO ACCEPT OR REJECT THE BID

PLL reserves the right to accept or reject the bid at any time prior to award of

contract without assigning any reason whatsoever.

14. FALL CLAUSE ( APPLICABLE ONLY FOR MATERIAL PROCUREMENT)

The price charged for the items supplied under the contract by the seller shall in no

event exceed the lowest price at which the seller or his Agent/Principal/Dealer, as

the case may be, sells the goods or offer to sell goods of identical description to any

persons/organizations around the world during the currency of the contract.

If at any time during the said contract period, seller or his Agent/Principal/Dealer,

as the case may be, reduces the sale price, sells or offers to sell such goods to any

persons/organizations at a price lower than the price chargeable under the contract,

he shall forthwith notify such reduction or sale or offer of sale to the PLL and the

price payable under the contract for the goods supplied after the date of coming into

force of such reduction or sale or offer of sale stand correspondingly reduced.

However, the above stipulation will not apply to:

a) Exports by the Seller


normal replacement

c) Sale of goods such as drugs which have expiry dates

The Seller shall furnish the following certificate to the concerned paying authority

along with each bill for payment for supplies made against this order.

“I/We certify that there has been no reduction in sale price of the goods of

description identical to the goods supplied to the PLL under the contract herein and

such goods have not been offered/sold by me/us to any person/organization around

the world upto the date of bill/ during the currency of the contract whichever is later,

at a price lower than the price charged to the PLL under the order”.

Such a certificate shall be obtained except for quantity of items/goods/materials

categories under sub clause (a), (b) & (c) above, of which details shall be furnished

by the Seller.



181

(a) War / Hostilities (b)Riot or Civil Commotion (c) Earthquake, flood, tempest,



Seller

The Seller shall advise Purchaser/Consultant by a registered letter duly certified by

the local Chamber of Commerce or statutory authorities, the beginning and end of

the above causes of delay within seven (7) days of the occurrence and cessation

of such Force Majeure conditions, In the event of delay lasting over one month, if

arising out of causes of Force Majeure, Purchaser reserves the right to cancel the

Contract and the provisions governing termination stated above shall apply. For

delays arising out of Force Majeure, the Seller shall not claim extension in

completion date for a period exceeding the period of delay attributable to the causes

of Force Majeure and neither Purchaser nor Seller shall be liable to pay extra costs

provided it is mutually established that Force Majeure conditions did actually exist.

Seller shall categorically specify the extent of Force Majeure conditions prevalent

in their works at the time of submitting their bid and whether the same have been

taken into consideration or not in their quotations. In the event of any Force Majeure

conditions, the Seller or the Purchaser shall not be liable for delays in performing

their obligations under this order and the delivery dates will be extended to the

Seller without being subject to price reduction for delayed deliveries, as stated

elsewhere.

16. Resolution of Disputes / Arbitration: (Arbitration as means of Dispute

Resolution will be applicable in the case of contracts above Rs 2 Crore)

All disputes or difference whatsoever that shall at any time arise between the parties

relating to execution of this Contract/Purchase order shall be referred to the Sole

Arbitrator appointed by the mutual consent of the parties. The arbitration shall be

conducted in accordance with the Arbitration Act, 1996 and its Rules as amended

from time to time. The proceedings shall be conducted in Delhi in the English

language. The cost of arbitration proceedings shall be shared equally by the parties.

17. Jurisdiction: The Contract/Purchase order/LOA shall be governed by the Laws of

India subject to the jurisdiction of the courts in Delhi.




182



19. PACKING & MARKING






20. DESPATCH DOCUMENTS

The dispatch documents shall consist of Bill of Lading/AWB, Invoice, Packing List,

Inspection/Test Certificate, Certificate of Conformity, Certificate of Origin of Goods

any other document(s) mentioned in the P.O. In case of direct documents, original

plus one copy of the documents may be sent to In-charge (F&A) PLL, immediately

after dispatch with copies to purchaser through e-mail/fax. Invoice must bear the

purchase order no. with date. The vendor will intimate dispatch particulars to

purchaser through e-mail / fax at the time of dispatch of goods. In case of

documents through Bank, it may be noted that the documents will be retired only if

the dispatches are made as per the terms of the purchase order.


183

Appendix – V

PROCEDURE FOR ISSUANCE OF COMPLETION/ EXECUTION CERTIFICATE

Suppliers/ Contractors/ Consultants are entitled for Completion Certificate after

completion of contract. In order to streamline the process of issuance of completion/

execution certificate against order/ contract issued by PLL as well as PMC, defining

the level of officer to be designated as Engineer-in-Charge (EIC) and to standardize

the format for same all across PLL, this procedure for issuance of completion/

execution certificate has been made.

Procedure for Issuance of Completion/ Execution certificate shall be as under:

1 ISSUANCE OF COMPLETION CERTIFICATE

i) Orders/ Contract placed against tender floated and processed by PLL

a) Completion Certificate, against contracts for Services/ Consultancy/ Works should

be issued by Engineer-in-Charge (EIC) after completion of services/ works in

accordance with contract.

Competent level of officer to be designated as Engineer-in-Charge (EIC) against a

contract is as under:

Engineer- in- Charge:

Engineer- in- Charge (EIC) against a contract for services/ consultancy/works shall

be nominated by the Competent Purchase Authority, ideally an officer one level

below the competent authority for award of contract should be EIC.

In case Competent Authority is Director and above EIC shall be nominated by the

concerned Director.

If the required level of officer is not available, EIC shall be next level officer available

or an officer authorized by the Head of Department.

Further, the Completion Certificate should be issued in format as provided at

Appendix-VI (Annexure-1).

b) No Completion Certificate shall be issued against orders for supply of goods only.

However, for these cases, a copy of Good Receipt (GR) duly signed by concerned

Store-in-charge will be forwarded to the concerned supplier.

c) Completion Certificate, in case of order for supply of goods along with associated

services (like erection, installation, commissioning etc.) should be issued after


184

completion of supplies/services in accordance with order by an officer of Indenting/

Projects department/Site Construction Department one level below the competent

authority for award of order. However, where the competent authority for award is

Director and above, Completion Certificate should be issued by an officer one level

below the Director or Certificate can be issued by Plant head in case of Plants. If

the required level of officer is not available, Completion Certificate should be issued

by next level officer available or an officer authorized by the Head of Department.

Further, the Completion Certificate should be issued in format as provided at

Proforma at Appendix-VI (Annexure-2).

2 Completion of work/supply/services for issuance of completion certificate shall be

as under:

a) For Supply: Completion of supply and acceptance of materials in all respect as per

provisions of order.

b) For Services/works: Completion of works/ services as per provisions of LOA/

Contract duly accepted and certified by EIC.

3 ISSUANCE OF EXECUTION CERTIFICATE

Execution Certificate against Rate/ Maintenance contract for supplies/ services/

consultancy/works should be issued against written request from Supplier/

Consultant/Contractor by an officer who is competent to issue Completion

Certificate against order/ contract (as per provision mentioned at sl. no. 1.0 (i) (a)

and 1.0 (i) (c) hereinabove) in format as provided at Appendix-VI (Annexure-3).

However, where an asset is ready for commercial use, execution certificate against

works contract for that asset can be issued with the approval of competent authority

for award. However, where competent authority is Director and above, approval for

issuance of execution certificate in such a case from one level below Director or

Plant head shall suffice.

4 Contract/ order value and executed value mentioned in Completion/Execution

certificate should be exclusive of value of free issue materials/ services provided by

PLL to Contractor/ Vendor/Supplier.

5 Completion/Experience Certificate issued as specified above must be specific to

Purchase Order/ LOA/ Contract. No certificate should be issued to

Suppliers/Contractors/Consultants which is not obligatory under the work

orders/contracts.


185

Appendix-VI

PROFORMA

Annexure-1

COMPLETION CERTIFICATE TO BE ISSUED AGAINST CONTRACTS FOR

SERVICES/ CONSULTANCY/ WORK

Name of Services/

Consultancy/Work

Name of Contractor/ Consultant

LOA No. and date

Contractual Start Date

Contractual Completion Date

Actual Completion Date

Awarded Value of Services/

consultancy/ Work

Executed Value of Services/

consultancy/ Work

Place: [Signature of authorised signatory]

Date: Name:

Designation:

Seal:

Note:

1. Completion certificate to be issued on letter head only.

2. This certificate is to be issued by competent level of office as per procedure in this

regard.


186

Annexure-2

COMPLETION CERTIFICATE TO BE ISSUED AGAINST ORDER FOR SUPPLY

OF GOODS ALONG WITH SERVICES (LIKE ERECTION, INSTALLATION,

COMMISSIONING ETC.)

Description of materials in brief

Name of Supplier

PO No. and date

Contractual Delivery/ Completion

Date

(i) Supply

(ii) Services

Actual Delivery/ Completion Date

(i) Supply

(ii) Services

Value of PO

Executed Value of PO


Date: Name:

Designation:

Seal:

Note:

1. Completion certificate to be issued on letter head only.


regard.


187

Annexure-3

EXECUTION CERTIFICATE TO BE ISSUED AGAINST RATE/ MAINTENANCE

CONTRACT FOR SUPPLIES/ SERVICES/ CONSULTANCY/WORKS

Name of Supplies/Services/

consultancy/ Work

Name of Supplier/ Contractor/

Consultant

PO/ LOA No. and date

Contractual Completion/Delivery Date

Actual Completion Date of asset or

date of completed services/ supply/

consultancy taken for execution

Awarded Value of Supplies/Services/

Consultancy/Work

Executed Value of Work

(based on certified RA/ monthly bill)


Date: Name:

Designation:

Seal:

Note:

1. Execution certificate to be issued on letter head only.


regard.


188

Appendix-VII

PROCEDURE FOR EVALUATION OF PERFORMANCE OF VENDORS/

CONTRACTORS/ CONSULTANTS

1 GENERAL

A system for evaluation of Vendors/ Suppliers/Contractors/ Consultants and their

performance is a key process and important to support an effective purchasing &

contracting function of an organization.

Performance of all participating Vendors/ Suppliers/Contractors/ Consultants need

to be closely monitored to ensure timely receipt of supplies from a Vendor,

completion of an assignment by a Consultant or complete execution of order by a

contractor within scheduled completion period. For timely execution of projects and

meeting the operation & maintenance requirement of operating plants, it is

necessary to monitor the execution of order or contracts right from the award stage

to completion stage and take corrective measures in time.

2 OBJECTIVE

The objective of Evaluation of Performance aims to recognize, and develop reliable

Vendors/ Suppliers/Contractors/ Consultants so that they consistently meet or

exceed expectations and requirements.

The purpose of this procedure is to put in place a system to monitor performance

of Vendors/ Suppliers/Contractors/ Consultants associated with PLL in Projects and

in O&M so as to ensure timely completion of various projects, timely receipt of

supplies including completion of works & services for operation and maintenance

of operating plants and quality standards in all respects.

3 METHODOLOGY

i) Preparation of Performance Rating Data Sheet

Performance rating data Sheet for each and every Vendor/ Supplier/Contractor/

Consultant for all orders/Contracts with a value of Rs. 7 Lakhs and above is

recommended to be drawn up. These data sheets are to be separately prepared for

orders/ contracts related to Projects and O&M. Format, Parameters, Process,

responsibility for preparation of Performance Rating Data Sheet are separately

mentioned.


189

ii) Measurement of Performance

Based on the parameters defined in Data Sheet, Performance of concerned

Vendor/ Supplier/Contractor/ Consultant would be computed and graded

accordingly. The measurement of the performance of the Party would be its ability

to achieve the minimum scoring of 60% points in the given parameters.

iii) Initiation of Measures:

Depending upon the Grading of Performance, corrective measures would be

initiated by taking up the matter with concerned Vendor/ Supplier/Contractor/

Consultant. Response of Vendor/ Supplier/Contractor/ Consultant would be

considered before deciding further course of action.

iv) Implementation of Corrective Measures:

Based on the response of Vendor/ Supplier/Contractor/ Consultant, concerned

Engineer-in-Charge for the Projects and/or OIC in case of O&M would recommend

for continuation or discontinuation of such party from the business of PLL.

v) Orders/contracts placed on Proprietary/OEM basis for O&M will be evaluated and,

if required, corrective action will be taken for improvement in future.

4 EXCLUSIONS:

The following would be excluded from the scope of evaluation of performance of

Vendors/ Suppliers/Contractors/ Consultants:

i) Orders/Contracts below the value of Rs. 7 Lakhs.

ii) One time Vendor/ Supplier/Contractor/ Consultant.

iii) Orders for Misc./Administrative items/ Non stock Non valuated items.

However, concerned Engineer-in-Charge /OICs will continue to monitor such cases

so as to minimize the impact on Projects/O&M plants due to non-performance of

Vendors/ Suppliers/Contractors/ Consultants in all such cases.

5 PROCESS OF EVALUATION OF PERFORMANCE OF VENDORS/ SUPPLIERS/

CONTRACTORS/ CONSULTANTS

5.1 FOR PROJECTS

i) Evaluation of performance of Vendors/ Suppliers/Contractors/ Consultants in case

of PROJECTS shall be done immediately with commissioning of any Project.


190

ii) On commissioning of any Project, EIC (Engineer-in-charge)/ Project-in-charge shall

prepare a Performance Rating Data Sheet (Format - at Appendix-VIII (Annexure 1))

for all Orders and Contracts excluding cases under para 4.0.

iii) Depending upon the Performance Rating, following action need to be initiated by

Engineer-in-charge/Project-in-charge:

S.No. Performance

Rating

Action

1 POOR Seek explanation for Poor performance

2 FAIR Seek explanation for Fair performance

3 GOOD Letter to the concerned for improving

performance in future

4 VERY GOOD No further action

iv) Reply from concerned Vendor/ Supplier/Contractor/ Consultant shall be examined.

In case of satisfactory reply, Performance Rating data Sheet to be closed with a

letter to the concerned for improving performance in future.

v) When no reply is received or reasons indicated are unsatisfactory, the following

actions need to be taken:

A. Where performance rating is “POOR”

Recommend such defaulting Vendor/Supplier/Contractor/ Consultant for putting

on Holiday as per “Procedure for Putting an Agency on Holiday and Banning List"

As mentioned at Appendix IX:

i) Poor Performance due to reasons other than Quality : One Year

ii) Poor Performance on account of Quality (if any mark obtained against Quality

parameter is less than 30): Two Years

iii) Poor Performance leading to termination of contract or Offloading of contract due

to poor performance solely attributable to Vendor/Supplier/Contractor/Consultant or

Repeated Offence: Three Years


191

Non-performance of a Vendor/Supplier/Contractor/Consultant leading to

termination of Contract/ Order such Vendor/ Supplier/ Contractor/Consultant are

also to be considered for Suspension.

In all such cases, concerned site will put up recommendation for issuance of SCN

and putting the party on suspension list as per process defined for suspension in

“Procedure for Action in case of Corrupt/ Fraudulent/ Collusive/ Coercive Practices”

B. Where Performance rating is “FAIR”

Recommend for issuance of warning to such defaulting

Vendors/Contractors/Consultants to improve their performance.

5.2 FOR CONSULTANCY JOBS

Monitoring and Evaluation of consultancy jobs will be carried out in the same way

as described in para 5.1 for Projects except the functions of Project Manager will

be performed by concerned In-charges of user Deptts. Such as Project

Development, Business Development, HR, Finance, HSE etc. The provision of para

5.1 (xii) will not be applicable for consultancy jobs.

5.3 FOR OPERATION & MAINTENANCE

i) Evaluation of performance of Vendors/ Suppliers/Contractors/ Consultants in case

of Operation and Maintenance shall be done immediately after execution of order/

contract.

ii) After execution of orders a Performance Rating Data Sheet (Format at Annexure-

2) shall be prepared for Orders by C&P and for Contracts/Services by respective

Engineer-In-Charge excluding cases under para 4.0.

iii) Depending upon Performance Rating, following action need to be initiated by C&P

Sl. No. Performance Rating Action

1 POOR Seek explanation for Poor

performance

2. FAIR Seek explanation for Fair

performance


192

3 GOOD Letter to the concerned for

improving performance in

future.

4 VERY GOOD No further action

iv) Reply from concerned Vendor/ Supplier/Contractor/ Consultant shall be examined.

In case of satisfactory reply, Performance Rating data Sheet to be closed with a

letter to the concerned for improving performance in future.

v) When no reply is received or reasons indicated are unsatisfactory, the following

actions need to be taken:

A. Where performance rating is “POOR”

Recommend such defaulting Vendor/Supplier/Contractor/ Consultant for putting

on Holiday as per “Procedure for Putting an Agency on Holiday and Banning List"

As mentioned at Appendix IX:

i) Poor Performance due to reasons other than Quality : One Year

ii) Poor Performance on account of Quality (if any mark obtained against Quality

parameter is less than 30): Two Years

iii) Poor Performance leading to termination of contract or Offloading of contract due

to poor performance solely attributable to Vendor/Supplier/Contractor/Consultant or

Repeated Offence: Three Years

B. Where Performance rating is “FAIR”

Recommend for issuance of warning to such defaulting

Vendors/Contractors/Consultants to improve their performance.


193

APPENDIX-VIII

FORMATS

Annexure-1

Petronet LNG Limited

PERFORMANCE RATING DATA SHEET

(FOR PROJECTS/ CONSULTANCY JOBS)

i) Project/Work Centre :

ii) Order/ Contract No. & date :

iii) Brief description of Items :

Works/Assignment

iv) Order/Contract value (Rs.) :

v) Name of Vendor/Supplier/ :

Contractor/ Consultant

vi) Contracted delivery/ :

Completion Schedule

vii) Actual delivery/ :

Completion date

Performance

Parameter

Delivery/

Completion

Performance

Quality

Performance

Reliability

Performance

#

Total

Maximum

Marks

40 40 20 100

Marks

Allocated

Note:

Remarks (if any)

PERFORMANCE RATING (**)

Note:

(#) Vendor/Supplier/Contractor/Consultant who seek repeated financial assistance

or deviation beyond contract payment term or seeking direct payment to the sub-


194

vendor/sub-contractor due to financial constraints, then ‘0’ marks should be allotted

against Reliability Performance.

(*) Allocation of marks should be as per enclosed instructions

(**) Performance rating shall be classified as under:

Sl.

No.

Range

(Marks)

Rating

1 60 & below POOR

2 61-75 FAIR

3 76-90 GOOD

4 More than 90 VERY GOOD

Signature of Authorised Signatory:

Name:

Designation:


195

Instructions for allocation of marks

1. Marks are to be allocated as under :

1.1 DELIVERY/ COMPLETION PERFORMANCE 40 Marks

Delivery Period/ Delay in Weeks Marks

Completion Schedule

a) Upto 3 months Before CDD 40

Delay upto 4 weeks 35

” 8 weeks 30

” 10 weeks 25

” 12 weeks 20

” 16 weeks 15

More than 16 weeks 0

b) Above 3 months Before CDD 40


” 8 weeks 30

” 10 weeks 25

” 16 weeks 20

” 20 weeks 15

” 24 weeks 10


1.2 QUALITY PERFORMANCE 40 Marks

For Normal Cases: No Defects/ No Deviation/ No failure 40 marks

i. Rejection/Defects Marks to be allocated on

prorata basis for acceptable

Quantity as compared to total

Quantity for normal cases

10 marks

ii. When quality Failure

endanger System

Failure of severe nature

- Moderate nature

0 marks

5 marks


196

integration and safety

of the system

- low severe nature 10-25 marks

iii. Number of Deviations 1. No deviation :

2. No. of deviations < 2:

3. No. of deviations > 2:

5 marks

2 marks

0 marks

1.3 RELIABILITY PERFORMANCE 20 Marks

A. FOR WORKS/CONTRACTS

i) Submission of order acceptance, agreement, PBG,

Drawings and other documents within time

4 marks

ii) Mobilization of resources as per Contract and in time 4 marks

iii) Liquidation of Check-list points 4 marks

iv) Compliance to statutory and HS&E requirements

or

Reliability of Estimates/Design/Drawing etc. in case of

Consultancy jobs

4 marks

v) Timely submission of estimates and other documents

for Extra, Substituted & AHR items

4 marks

B. FOR SUPPLIES

i) Submission of order acceptance, PBG, Drawings and

other documents within time

5 marks

ii) Attending complaints and requests for after sales

service/ warranty repairs and/ or query/ advice (upto the

evaluation period).

5 marks

iii) Response to various correspondence and conformance

to standards like ISO

5 marks

iv) Submission of all required documents including Test

Certificates at the time of supply

5 marks


197

Annexure-2

Petronet LNG Limited

PERFORMANCE RATING DATA SHEET

(FOR O&M)

i) Location :

ii) Order/ Contract No. & date :

iii) Brief description of Items

Works/Assignment :

iv) Order/Contract value (Rs.) :

v) Name of Vendor/Supplier/

Contractor/ Consultant :

vi) Contracted delivery/

Completion Schedule :

vii) Actual delivery/

Completion date :

Performance

Parameter

Delivery/

Completion

Performance

Quality

Performance

Reliability

Performance#

Total

Maximum

Marks

40 40 20 100

Marks Allocated

Note:

Remarks (if any)

PERFORMANCE RATING (**)

Note:

(#) Vendor/Supplier/Contractor/Consultant who seek repeated financial assistance

or deviation beyond contract payment term or seeking direct payment to the sub-

vendor/sub-contractor due to financial constraints, then ‘0’ marks should be allotted

against Reliability (*) Allocation of marks should be as per enclosed instructions

(**) Performance rating shall be classified as under:


198

Sl.

No.

Range

(Marks)

Rating

1 60 & below POOR

2 61-75 FAIR

3 76-90 GOOD

4 More than 90 VERY GOOD

Signature of Authorised Signatory :

Name :

Designation :


199

Instructions for allocation of marks (For O&M)

1. Marks are to be allocated as under :

1.1 DELIVERY/ COMPLETION PERFORMANCE 40 Marks

Delivery Period/ Delay in Weeks Marks

Completion Schedule

a) Upto 3 months Before CDD 40


” 8 weeks 30

” 10 weeks 25

” 12 weeks 20

” 16 weeks 15


b) Above 3 months Before CDD 40


” 8 weeks 30

” 10 weeks 25

” 16 weeks 20

” 20 weeks 15

” 24 weeks 10


1.2 QUALITY PERFORMANCE 40 Marks

For Normal Cases: No Defects/ No Deviation/ No failure 40 marks

Rejection/Defects Marks to be allocated on

prorata basis for acceptable

Quantity as compared to total

Quantity for normal cases

10 marks


200

When quality Failure

endanger System

integration and safety of

the system

Failure of severe nature

- Moderate nature

- low severe nature

0 marks

5 marks

10-25 marks

Number of Deviations 1. No deviation :

2. No. of deviations < 2:

3. No. of deviations > 2:

5 marks

2 marks

0 marks

1.3 RELIABILITY PERFORMANCE 20 Marks

A. FOR WORKS/CONTRACTS

i) Submission of order acceptance, agreement, PBG,

Drawings and other documents within time

4 marks

ii) Mobilization of resources as per Contract and in time 4 marks

iii) Liquidation of Check-list points 4 marks

iv) Compliance to statutory and HS&E requirements

or

Reliability of Estimates/Design/Drawing etc. in case of

Consultancy jobs

4 marks

v) Timely submission of estimates and other documents for

Extra, Substituted & AHR items

4 marks

B. FOR SUPPLIES

i) Submission of order acceptance, PBG, Drawings and other

documents within time

5 marks

ii) Attending complaints and requests for after sales service/

warranty repairs and/ or query/ advice (upto the evaluation

period).

5 marks

iii) Response to various correspondence and conformance to

standards like ISO

5 marks

iv) Submission of all required documents including Test

Certificates at the time of supply

5 marks


201

Appendix-IX

PROCEDURE FOR PUTTING AN AGENCY ON HOLIDAY AND BANNING LIST

DEFINITION:

“Agency” shall mean Bidder / vendor / Contractor / Supplier / Consultant of Petronet

LNG Limited (PLL).

“Corrupt practice” means the offering, giving or soliciting of anything of pecuniary

advantage value to improperly influence by abuse of entrusted power, the

procurement process or in contract execution.

“Fraudulent practice” includes any act or omission committed by an agency / entity

by misrepresenting, misleading/submitting false document and or false information

or concealment of facts in order to influence the procurement process as well as

during the execution of contract.

“Collusive practice” amongst bidders means a scheme or arrangement designed to

establish bid prices at artificial non-competitive level and to deprive PLL of the

benefit of free and open competition.

“Coercive practice” means impairing or harming or threatening to impair or harm

directly or indirectly, any agency or its property to influence the improper actions of

an agency, obstruction of any investigation or auditing of a procurement/contract

process.

A. INTRODUCTION:

In the course of the bidding / contracting (procurement, works and service

contracts), agencies (bidder(s) / vendor(s) / supplier(s) / contractor(s) /

consultant(s)) are expected to adopt ethics of highest standards and a high degree

of integrity, safety & quality consciousness, commitments and sincerity towards

terms and conditions of the tender(s) / order (s) undertaken. Any aberration,

deviation and violation from the expected behavior of the Agencies need to be dealt

appropriately by putting the Agencies on holiday or banning list for specific periods

so that it becomes a deterrent for all the future transactions.

1. HOLIDAY LIST

An Agency may be put in the Holiday list in case if:

a. It has refused to accept LOA/LOI/Purchase order/contract (order value 10 Lakhs

and above) after the same is issued within the period of Bid validity and as per


202

agreed terms & conditions or,

b. The materials supplied by the agency are found to be defective and fails to perform

during its use/operation. Premature failure of the work executed by

contractor/failure of equipment during the operation, and not giving the desired

result as per provision of the contract or,

c. The rating of the vendor/ consultant come to be POOR as per Procedure For

Evaluation Of Performance Of Vendors/ Contractors/ Consultants

d. It is declared or is in the process of being declared bankrupt, insolvent, wound up,

dissolved or partitioned; or

e. It persistently violates provisions of labor laws/ regulations / rules, safety norms,

environmental norms or other statutory requirements; or

2. BANNING LIST

Any Agency can be put in the Banning list in case if:

a. if it is involved in an instance of Corrupt, Fraudulent, Collusive and Coercive practice

against PLL.

b. it is involved in fraudulent activity, wilful mis-conduct, mis-representation, mis-

declaration, security considerations or,

c. it has indulged in any type of forgery or falsification of records; or

d. the proprietor of the firm, its employee(s), partner(s) or representative(s) is / are

convicted by a court of law for offences involving moral turpitude in relation to

business dealings.

e. There is strong justification for believing that the proprietor or employees or

representatives of firm have been guilty of malpractices such as bribery, corruption,

fraud, substitution of tenders, interpolations, misrepresentation, evasion or default

in payment of any tax levied by law.

B. PROCEDURE FOR PUTTING AGENCY IN BANNING / HOLIDAY LIST.

The process as mentioned below shall be followed across all PLL Locations for

putting an agency on Holiday or Banning List.

(i) Once it comes to the notice of any department as mentioned in clause (A) above,

about an irregularity committed by an agency, a committee consisting of members

from Project /indenting department, C&P, F&A and Legal department shall be

constituted by the competent authority to examine the case.

(ii) This committee shall examine the case in detail and submit its report.


203

(iii) If the committee, after examinations comes to a conclusion that there is no merit in

the case and it does not require any further action; shall make a recommendation

for closure of the case with due reasoning. Such recommendation shall be

submitted to the authority who constituted the committee for approval.

(iv) In case the committee after detailed examination comes to the conclusion that the

case requires further action, it shall make a recommendation for banning / holiday

including actions as per the provisions of the applicable law and the same shall be

put up to approving authority.

The above recommendation shall contain a show cause notice to be issued to the

agency. The show cause notice shall contain the alleged breach committed by the

agency stating provision of the tender/contract. The explanation to be sought from

the agency as to why action should not be taken as per provision of the

tender/contract. The show cause notice shall require vetting by the legal department

while placing for approval of concerned Director through competent authority. In

addition to above, concurrence of Director (Finance) shall also be required in all

cases.

(v) After obtaining approval from the concerned Director, the show cause notice shall

be issued by the C&P Department. The concerned agency shall be given 2 (two)

weeks’ time from the date of issuance of notice for submission of its response to

the show cause notice.

(vi) The response to show cause notice received from the agency shall be forwarded

by C&P department to the committee, which made the recommendation. The

committee shall examine the reply from the agency and make its final

recommendation for banning or otherwise. In case the committee recommends for

banning/ holiday , a draft approval giving complete reason for banning / holiday to

be provided along with the recommendation by the committee. The above

recommendation shall require vetting by legal department with reference to show

cause notice before it is put up for approval from concerned Director through

competent authority, concurrence of Director (Finance) shall also be required in all

cases.

(vii) The Committee shall also propose the Banning / Holiday Period in its

recommendation based on the severity of the case.

(viii) After obtaining the approval from the Directors, C&P department shall issue a

Banning / Holiday Order and shall put the name of agency on holiday list or banning


204

list. This order shall be communicated to all PLL locations. C&P department shall

intimate BIS department for updation of the same in SAP.

(ix) The order for putting an Agency in Banning and Holiday List after expiry of the

Banning / Holiday period shall automatically get revoked and shall not require

issuance of any separate order. The name of the Agency will be removed from the

Banning / Holiday list hosted on SAP System after expiry of the Banning / Holiday

period.

(x) The tender conditions should have the provision of above guidelines for action to

be taken in preferably in ITB (Instruction to Bidders).

C. Procedure To Be Followed For Irregularities Observed At Various Stages

1. Irregularities noticed during Bidding Process :

If any irregularity mentioned in Clause A.2 is observed during bidding process/ bids

evaluations stage the bid of such Bidder (s) shall be rejected after due approval

from the competent authority and following the due procedure as mentioned in

Clause B above.

The committee formed as per Clause B above on the basis of severity of the case

and the urgency of the requirement shall recommend to extend the Bidding process

until completion of the procedure as mentioned in Clause B or it may recommend

to reject the Bid of the concerned Bidder and carry out the Bidding process. The

approval for rejecting such Bid shall be obtained from Director (Technical) and

Director (Finance). However for the extension of the Bidding process approval from

competent authority shall suffice.

In case the irregularities are found to be true the EMD/ Bid security of such Bidder

shall be forfeited.

2. Irregularities noticed after award of contract

(i) During execution of contract:

The Procedure as mentioned in Clause B shall be followed and in case irregularities

are found to be true the contract shall be suspended with immediate effect.

The agency shall be banned / put on holiday list for future business with PLL for a

period specified in Clause (D) below from the date of issue of banning / holiday

order.

The PBG submitted by such agency against such order/ contract shall also be

forfeited.

The amount that may have become due to the contractor on account of work


205

already executed by him shall be payable to the contractor and this amount shall

be subject to adjustment against any amounts due from the contractor under the

terms of the contract.

(ii) After execution of contract and during Defect liability period (DLP)/ Warranty/

Guarantee Period:


are found to be true, the agency shall be banned / put on holiday list for future

business with PLL for a period specified in Clause (D) below from the date of issue

of banning / holiday order.

The PBG submitted by such agency against such order/ contract shall also be

forfeited.

(iii) After expiry of Defect liability period (DLP)/ Warranty / Guarantee Period.


are found to be true, the agency shall be banned / put on holiday list for future

business with PLL for a period specified in Clause (D) below from the date of issue

of banning / holiday order.

3. Exceptional Cases:

(i) However as an exception, the ongoing order(s)/ contract(s) where irregularities has

been observed, the agency may be allowed to complete the supply/ job in case of

following situations:

a) No adverse performance of the job as per scope of work (performance to be

reviewed on quarterly basis) and;

b) The supply/ jobs is of critical nature in terms of adverse impact on the Project

Completion Schedule and or prospective revenue generation.

(ii) The approval for allowing the agency to complete the supply/ job is to be obtained

from Director concerned with concurrence of Director (Finance) based on the

detailed deliberation/ recommendation of the committee formed as per Clause (B)

above.

After approval of Director(s) to allow the agency to complete the supply/ job, the

agency will be allowed to execute the order/ contract and payment shall also be

made as per provision of order/ contract.

(III) The Performance Bank Guarantee (PBG), of such agency against the order (s)/

contract (s) where agency is allowed to complete the supply/ job in above

exceptional case shall not be forfeited on this ground. The contract shall be


206

executed as per terms and conditions of the contract. However, the agency shall

be put on Banning / Holiday List from the date of banning order.

4. Effect of Banning on other ongoing Contracts/ Tenders

(i) If an agency is put on Banning / Holiday List, such agency should not be considered

in ongoing tenders/ further tenders.

(ii) However, if such an agency is already executing other order(s)/ contracts (s) where

no irregularities are observed, the agency should be allowed to continue till its

completion without any further increase in scope except those incidental to original

scope mentioned in the Contract.

D. HOLIDAY / BANNING PERIOD

(i) The Agency can be put on Holiday for a time period ranging from 6 months to 3

years. The committee examining the case shall propose the holiday period in its

recommendation.

(ii) Banning period shall be reckoned from the date of banning order and shall be of 3

years.

(iii) In exceptional cases where the act of vendor/ contractor is a threat to the National

Security, the banning shall be for indefinite period.

E. CONTRACT PROVISION

The tender/contract condition should have relevant operating provision of this

guideline in respect of Banning/ Holiday to take care of issues which may lead to

putting the vendor on Banning / Holiday list.

F. HOSTING OF BANNING / HOLIDAY LIST ON INTRANET / SAP MODULE.

(i) The Banning / Holiday list of agencies shall be hosted on PLL intranet and shall

also be incorporated in SAP.

(ii) The Banning / Holiday list shall be updated once a agency is listed in Banning /

Holiday list or, the Banning/ Holiday period is completed for an enlisted agency.

(iii) The SAP system must restrict and provide a pop up message during Request for

Quotation (Tender) / Purchase Order creation in case user wants to create a

Request for Quotation (Tender) / Purchase Order to an agency listed in Banning /

Holiday list. However in exceptional cases a user may issue the Request for

Quotation (Tender) / Purchase Order to such agency after written approval from the

concerned director indicating the valid reason for issuing tender / placing the order

to such agency.


207

Appendix-X

CHECKLIST FOR PRE-AWARD ACTIVITIES

i. The check-lists for following Pre-Award Activities has been prepared :-

i) Check list for recommendation/ proposal for BEC, Evaluation methodology

etc. –Annexure-1.

ii) Check list for proposal for issuance of RFQ/Tender (OEM/ Proprietary/Nomination/

Cases where BEC is not required) - Annexure-2

iii) Check list for recommendation/ proposal for Price Bid Opening- Annexure-3

iv) Checklist for recommendation/ proposal for Award - Annexure-4

ii. All concerned are to refer the check-list for various pre-award activities while

processing the cases for ensuring compliance of the procedure. Further, the

compliance to the checklist is to be placed in file and a reference is to be made in

respective proposal/ TCR.


208

Annexure-1

CHECK LIST FOR RECOMMENDATION/ PROPOSAL FOR BEC

Sr. No. Description Compliance

1. PR/SR prepared & released in SAP

2. In the PR/SR, item wise estimates be kept including GST

and other charges etc.

3. Minutes/ points discussed in Pre-Tender Meeting (as per

SoP) enclosed and action proposed on relevant points/

taken in SCC,SOW or BEC

4. Incorporation of lesson learnt in previous tenders, if any

5. Consistency in BEC in case of regular/ repeated cases. In

case of shift, the reasons for the same must be deliberated.

6. To verify that name of prospective bidders are not

appearing in Holiday/ Banning/ Suspension list, available

on Intranet.

Checking the address of vendor with address available in

vendor code

7. Evaluation Methodology

8. Relevant clauses of DoA and C&P Procedures (as

applicable)

9. Cost-DFR Vs. Estimate and reason for difference, if any

(applicable in project cases)

10. Vetting of SCC and Scope of Works from HR department

for Service/ Works contract.

11. Whether consortium provision is included in tender. If yes

Whether responsibility matrix included.


209

Annexure-2

CHECK LIST FOR PROPOSAL FOR ISSUANCE OF RFQ/ TENDER (OEM/

PROPRIETARY/ NOMINATION/ CASES WHERE BEC IS NOT REQUIRED)

Sr. no. Description Compliance

1. i) PAC approval as per procedure- for procurement on

PAC basis

ii) OEM approval as per procedure- for procurement on

OEM basis

2. Nomination cases: Proposal for administrative approval

contain:

- Reasons for award on nomination basis.

- Reasons for selecting particular vendor/ contractor/

Consultant/ service provider.


Administrative approval is obtained from competent

authority defined in C&P Procedure and DoA.

3. Cases where BEC is not required

- Vendor as per list provided along with PR/SR

- Vendor on whom last order/ contract placed is included

(if the performance is not poor)

- To verify that name of prospective bidders are not

appearing in Holiday/ Banning/ Suspension list.

- Checking the address of vendor with address available

in vendor code.

4. Incorporation of lesson learnt in previous tenders, if any

5. Evaluation Methodology (wherever applicable)

6. Vetting of tenders as per procedure.

Vetting of SCC and Scope of Works from HR department

for Service/ Works contract.


applicable)


210

Annexure-3

CHECK LIST FOR RECOMMENDATION/ PROPOSAL FOR PBO


1. Details of bidders participated along with quoted part/

items/section

2. TBA is signed by competent level of executive in

indenting department (for cases where PMC is not

involved). Names and designations of officials should be

clearly specified in TBA.

TBA checked and vetted by Indenter/ Project Manager

(for cases where PMC is involved)

TBA should cover all point related to BEC, compliance to

specifications/ scope of works/ special conditions of

contract and all other important technical provisions of

tender.

3. CBA (in standardized format with applicable

modifications, if any) is signed by competent level of

executive in C&P and F&A department (for cases where

PMC is not involved). Names and designations of

officials should be clearly specified in CBA.

CBA checked and vetted by C&P and F&A department

(for cases where PMC is involved).

4. Deliberation of committee in case 2nd or subsequent

TQ/CQ issued.

5. Details of techno-commercially acceptable bidders along

with acceptable part/ items/section

6. Specific reasons for rejection of bid, if any

7. Deliberation on ERC recommendation (if applicable)

8. Deliberation on insufficient competition (wherever


211

applicable)

9. To verify that name of techno-commercially acceptable

bidders are not appearing in Holiday/ Banning list

10. Validity of Bid and EMD/ Bid Security of techno-

commercially acceptable bidders


applicable)

12. Whether all the fact of case has been considered while

preparing the recommendations

13. Time taken from Bid due date opening to PBO

recommendation


212

Annexure-4

CHECK LIST FOR RECOMMENDATION/ PROPOSAL FOR AWARD


1. Dealing the review of Estimate by Indenter or PMC

(wherever applicable)

2. Summary of Price Comparison of evaluated prices &

estimates and reasonability off prices

3. Analysis and review of estimate if L1 price is higher

than estimates

4. Deliberation on insufficient competition (wherever

applicable)

5. Any suspicion regarding cartelization

6. Recommendation on re-tendering (if applicable)

7. Impact on project cost (Not applicable for O&M)

8. Impact of delivery period on Project Schedule

9. Details of total financial implication committed on the

project (for projects)

10. Analysis of L1 price if it is higher than estimates

11. Ordering Cycle time

12. Past purchase price comparison for purchases

13. Clear recommendation for approval is to be

submitted, no conditional recommendation.

14. Verifying that name of recommended bidder (s) are

not appearing in Holiday/ Banning list, available on

Intranet Further the vendor code through which offer

is submitted is same as the vendor code on which

order/ contract is to be placed (mentioned in bid)


213

Bill to and ship to details as per guidelines in this

regard.

15. Total committed cost in project with the award of

subject package (Not applicable for O&M). Head

wise (Approved/ Committed/Actual/ Anticipated) as

per enclosed Appendix-I.

16. Dealing of insufficient competition in terms of clause

no. 33.1 of C&P Procedure (wherever applicable).

Cost details showing all DFR heads in DFR vs

committed vs actual (for Project cases)

17. For the cases of Repeat Order

(i) Confirmation that repeat order does not exceed

50% of Original Qty (or as mentioned in original PO)

and is placed within 06 months from Notification of

Award.

(ii) Confirmation that repeat order is not being placed

on an emergency purchase, negotiated purchase,

sole acceptable offer basis and where the prices

against original order were escalated to compensate

for early delivery(ies)

(iii) Confirmation from Indenter/ User/Project

Department as per 39 (i) of C&P Procedure


applicable)

19. Preparation of Draft EPC Agenda as per format and

keeping the same in file (for EPC cases)

20. Whether all the fact of case has been considered

while preparing the recommendations

21. Time taken from Price bid opening to Award

recommendation


214

Appendix-XI

PRINCIPLE GUIDELINES FOR INTEGRITY PACT

1. INTRODUCTION

Petronet LNG Limited is a Private Sector Organization engaged in LNG business in

India. Petronet is the premier organization in this business and conduct its

operations in accordance with the highest ethical standards.

It does business with a number of domestic and international Bidders, Contractors

and Vendors of goods and services (Counterparties). Petronet is committed to

fostering the most ethical business relationship with all Counterparties and deals

with them in a fair and transparent manner.

In order to achieve these goals, Petronet is committed to implementing the lntegrity

Pact Program.

This Program will cover Tenders valued of Rs. Fifteen (15) Crore and above.

Following are the details of Petronet’s Integrity Pact Program:

- Commitments and Obligations of Petronet

- Commitments and Obligations of Counterparties

- Violation and Consequences

- Independent Monitor

- Implementation Guidelines

- Periodic Review and Evaluation

2. COMMITMENT AND OBLIGATIONS OF PETRONET

a) Petronet is committed to have most ethical business dealings with Counterparties

b) Petronet values its relationship with all Counterparties and will deal with them in a

transparent manner with equity and fairness.

c) Petronet and / or its Associates (officers, Directors, Agents, Consultants, Advisors,

etc) will not seek or take any undue benefit directly or indirectly for themselves or

for third parties.

d) Petronet will exclude all of Associates who may be prejudiced or have a Conflict of

interest in dealings with Counterparties.

e) Petronet will honour its commitments and make due payments to Counterparties in

a timely manner.Document downloaded on 09-04-2022 07:07:28 by

215

f) Petronet will initiate action and pursue it vigorously whenever unethical behavior

occurs or is suspected to have occurred.

3. COMMITMENTS AND OBLIGATIONS OF THE ‘COUNTERPARTY’

a) The Counterparty, directly or indirectly (through agent, consultant, advisor, etc) will

not pay any bribes or give illegal benefit to any one in dealings with Petronet.

b) The Counterparty will not bring any Political, Governmental or Diplomatic influence

to gain undue advantage in its dealing with Petronet.

c) The Counterparty will not engage in collusion, Price-Fixing or enter into any

undisclosed agreement or understanding whether formal or informal with other

Counterparties or take any actions to restrict competitiveness in dealing with the

Petronet.

d) The Counterparty will not pass on to any third party any of the Petronet’s

confidential information unless authorized by the Petronet.

e) The Counterparty will promote and observe best ethical practices within its

organization.

f) The Counterparty will promptly inform the Chief of Corporate Ethics of Petronet

(i) if he receives demand for a bribe or illegal payment / benefit and

(ii) if comes to know of any unethical or illegal practice in the Petronet organization in

relation to the dealing with Petronet.

(iii) If it makes any payment to any Petronet Associate.

g) It will disclose to the Petronet promptly all payments he has make or intends to

make to agent, brokers or any intermediaries in connection with the award of

contract with Petronet.

h) The Counterparty will not make any false or misleading allegations against the

Petronet or its Associates.

i) The Counterparty will not induce any third person to commit offence as it outlined

above.

4. VIOLATIONS & CONSEQUENCES

a) If a Counterparty commits a violation of its Commitments and Obligations under the

Integrity Pact Program it may lose Bid Security and Performance Bond. In addition,

the Petronet may terminate the current contract and business relationship with that

Counterparty.

b) Petronet may also ban and exclude the Counterparty from future dealings until the

Petronet is satisfied that the Counterparty will not commit violations in future.


216

c) Petronet may initiate criminal proceedings against the violating Counterparty.

d) Petronet may initiate disciplinary action against any of its associates, who is in

breach of its obligation under this Integrated Pact and / or initiate criminal

proceeding under the relevant anti-corruption laws of India.

5. INDEPENDENT MONITOR

a) Petronet will appoint an independent Monitor to oversee lntegrity Pact Program

implementation and effectiveness of the lntegrity Pact Program. He shall be one of

the lndependent Director on the Board of Petronet.

b) The lndependent Monitor will be a person of impeccable integrity, knowledgeable

of Petronet’s business and experienced in commercial activities.

c) The major goal of the lndependent Monitor will be to implement lntegrity Pact

Program to ensure probity, transparency and ethical practices in procurement

process in Petronet.

d) The lndependent Monitor will not have administrative or enforcement

responsibilities. He may engage services of outside agencies such as accounting

firms, law firms, etc., at Petronet’s expense, if required, in discharge of his

responsibilities.

e) The lndependent Monitor will have access to all Associates and relevant internal

records of the Petronet He will also have access to Counterparties records and

information regarding its dealing with the Petronet in the event of any alleged breach

of this Pact.

f) The lndependent Monitor will have the right to attend any meetings between the

Petronet and the Counterparties in case of any request either from Petronet or the

counter party.

g) lf the lndependent Monitor observes or suspects an irregularity, he will inform the

Chairman of Petronet and its Board of Directors.

6. IMPLEMENTATION GUIDELINES

To implement the lntegrity Pact Program the Petronet shall do the following

a) Select and appoint an lndependent Monitor. lnitially the Chairman of the Audit

Committee of the Board of Directors of the Principal will be the lndependent Monitor.

b) Get appropriate authorization from its Board of Directors and commitment from all

Senior Level executives/officials of Petronet to implement the program.


217

c) Develop detailed implementation plans and finalize the lntegrity Pact document in

consultation with the lndependent Monitor.

d) Notify to all senior staff members, and major suppliers Petronet’s plans to

implement lntegrity Pact program.

e) Display the information on the Petronet’s website.

7. PERIODIC REVIEW & EVALUATION

lt is recommended that Petronet shall periodically review the effectiveness of

lntegrity Pact Program by the following:

a. The lndependent Monitor and senior leadership of Petronet conduct an annual self-

assessment of lntegrity Pact Program effectiveness and identify areas to improve

it.

b. The lndependent Monitor shall submit an annual report on the progress

effectiveness of lntegrity Pact Program to the Board of Directors of Petronet.


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Integrity Pact

Between

Petronet LNG Limited hereinafter referred to as "The Principal",

And

……………………………………………………………………………………………

………………………………hereinafter referred to as “Counterparty”

Preamble

The Principal intends to award, under laid down organizational procedures,

Contract/s for …………………………………………………………………………….

The Principal values full compliance with all relevant laws and regulations, and of

fairness and transparency in its relations with its all counterparties.

In order to achieve these goals, The Principal will appoint an externa! lndependent

Monitor who will monitor the tender process and the execution of the contract for

compliance with the principles mentioned above.

Section 1 - Commitments of the Principal

1. The Principal commits itself to take all measures necessary to observe the following

principles:-

a) The Principal is committed to have most ethical business dealings with

Counterparties.

b) The Principal values its relationship with all Counterparties and will deal with them

in a transparent manner with equity and fairness.

c) The Principal and/or its Associates (Officers, Directors, Agents, Consultants,

Advisors, etc.) will not seek or take any undue benefit directly or indirectly for

themselves or for third parties.

d) The Principal will exclude all of Associates who may be prejudiced or have a Conflict

of interest in dealings with Counterparties.

e) The Principal will honour its commitments and make due payments to

Counterparties on timely basis.


219

f) The Principal will initiate action and pursue it vigorously whenever corruption or

unethical behavior occurs.

2. No Associate of the Principal, personally or through family members, will in

connection with the tender for , or the execution of a contract, demand, take a

promise for or accept, for him/herself or third person, any material or immaterial

benefit which he/she is not legally entitled to.

3. The Principal will, during the tender process treat all Counterparties with equity and

fairness. The Principal will in particular, before and during the tender process,

provide to all Counterparties the same information and will not provide to any

Counterparty confidential/ additional information through which the Counterparty

could obtain an advantage in relation to the tender process or the contract

execution.

4. lf the Principal obtains information on the conduct of any of its Associates, which is

a breach of the above or a criminal offence under the relevant Anti-Corruption Laws

of India, or if there be a substantive suspicion in this regard, the Principal will inform

the lndependent Monitor and in addition can initiate disciplinary actions.

Section II - Commitments of the Counterparties

The Counterparty commits itself to take all measures necessary to prevent

corruption. He commits himself to observe the following principles during his

participation in the tender process and during the contract execution.

1. The Counterparty will not, directly or through any other person or firm, offer, promise

or give to any of the Principal's Associate employees involved in the tender process

or the execution of the contract or to any third person any material or immaterial

benefit which he/she is not legally entitled to, in order to obtain in exchange any

advantage of any kind whatsoever during the tender process or during the execution

of the contract.

2. The Counterparty will not enter with other Counterparty into any undisclosed

agreement or understanding, whether formal or informal. This applies in particular

to prices, specifications, certifications, subsidiary contracts, submission or non-

submission of bids or any other actions to restrict competitiveness or to introduce


220

cartelization in the bidding process.

3. The Counterparty will not commit any offence under the relevant Anti-corruption

Laws of India the Counterparty will not use improper1y, for purposes of

competition or personal gain, or pass on to others, any information or document

provided by the Principal as part of the business relationship, regarding plans,

technical proposals and business details, including information contained or

transmitted electronically unless authorized by Petronet.

4. The Counterparty will, when presenting his bid, disclose any and all payments he

has made, is committed to or intends to make to agents, brokers or any other

intermediaries in connection with the award of the contract.

5. The Counterparty will not instigate third persons to commit offences outlined above

or be an accessory to such offences.

6. The Counterparty will not bring any Political, govemmental or diplomatic influence

to gain undue advantage in its dealings with Petronet.

7. The Counterparty will not make any false or misleading allegation against Petronet

or its Associates.

Section III- Disqualification from tender process and exclusion from future

contracts

1. lf the Counterparty has committed a transgression through a violation of Section II

such as to put his reliability or credibility into question, the Principal is entitled

also to exclude the Counterparty from future contract award processes. The

imposition and duration of the exclusion will be determined by the severity of

the transgression. The severity will be determined by the circumstances of

the case, in particular the number of transgressions, the position of the

transgressors within the company hierarchy of the Counterparty and the amount

of the damage. The exclusion will be imposed for a minimum of 6 months and

maximum of 3 years.

2. The Counterparty accepts and undertakes to respect and uphold the Principal's

absolute right to resort to and impose such exclusion and further accepts and

undertakes not to challenge or question such exclusion on any ground, including

the lack of any hearing before the decision to resort to such exclusion is taken.

This undertaking is given freely and after obtaining independent legal advice.


221

3. lf the Counterparty can prove that he has restored/recouped the damage caused

by him and has installed a suitable corruption prevention system, the Principal

may revoke the exclusion prematurely.

Section IV - Compensation for Damages

1. lf the Principal has disqualified the Counterparty from the tender process prior to

the award according to Section - III the Principal is entitled to demand and

recover from the Counterparty liquidated damages equivalent Ernest Money

Deposit / Bid Security.

2. lf the Principal has terminated the contract according to Section- III, or if the

Principal is entitled to terminate the contract according to Section - III (3), the

Principal shall be entitled to demand and recover from the counterparty

Contractor liquidated damages equivalent to Security Deposit / Performance

Bank Guarantee.

Section V - Previous transgression

1. The Counterparty declares that no previous transgressions occurred in the last 3

years with any other Company that could justify his exclusion from the tender

process.

2. lf the Counterparty makes incorrect statement on this subject, he can be

disqualified from the tender process or the contract, if already awarded, can be

terminated for such reason.

Section VI – Equal treatment of all Counterparty / Subcontractors

1. The Counterparty undertakes to demand from all subcontractors a commitment in

conformity with this lntegrity Pact, and to submit it to the Principal before contract

signing.

2. The Principal will disqualify from the tender process all bidders who do not sign this

Pact or violate its provisions.


222

Section VIl - Criminal charges against violating Counterparty/ Subcontractors

lf the Principal obtains knowledge of conduct of a Counterparty or Subcontractor,

or of an employee or a representative or an associate of a Counterparty or

Subcontractor which constitutes corruption, or if the Principal has substantive

suspicion in this regard, the Principal will inform the lndependent Monitor who may

initiate criminal proceedings against the violator.

Section VIII -lndependent Monitor

1. The Principal will appoint competent and credible lndependent Monitor for this Pact,

who shall be one of the lndependent Director on the Board of the Principal. The task

of the lndependent Monitor is to review independently and objectively, whether and

to what extent the parties comply with the obligations under this agreement. Initially

the lndependent Monitor will be Chairman of the Audit Committee of its Board of

the Principal.

2. The lndependent Monitor is not subject to instructions by the representatives of the

parties and performs his functions neutrally and independently. He reports to the

Chairperson of the Board of the Principal.

3. The Counterparty will accept that the lndependent Monitor has the right to access

without restriction to all Project documentation of the Principal including that

provided by the Counterparty. The Counterparty will also grant the Monitor, upon

his request and demonstration of a valid interest, access to his project

documentation.

4. The Principal will provide to the lndependent Monitor sufficient information when

requested about all meetings among the parties related to the Project provided such

meetings could have an impact on the contractual relations between the Principal

and the Contractor. The parties offer to the Monitor the option to participate in such

meetings.

5. As soon as the lndependent Monitor notices, or believes to notice, a violation of this

agreement, he will so inform the Management of the Principal and request the

Management to discontinue or heal the violation, or to take other relevant action.

6. The word 'lndependent Monitor' would include both singular and plural.


223

Section IX - Pact Duration

This Pact begins when both parties have legally signed it. lt expires for the

Contractor 12 months after the last payment under the respective contract, and for

all other Counterparties 6 months after the contract has been awarded.

lf any claim is made / lodged during this time, the same shall be binding and

continue to be valid despite the lapse of this pact as specified above, unless it is

discharged / determined by Chairperson of the Principal.

Section X - Other Provisions

1. This agreement is subject to Indian Law. Place of performance and jurisdiction is

the Registered Office of the Petronet LNG Ltd, World Trade Centre, First Floor,

Babar Road, Barakhamba Lane, New Delhi.

2. Changes and supplements as well as termination notices need to be made

in writing. Side agreements have not been made.

3. lf the Counterparty is a partnership or a consortium ; this agreement must be

signed by all partners or consortium members.

4. Should one or several provisions of this agreement turn out to be invalid, the

remainder of this agreement remains valid. In this case, the parties will strive to

come to an agreement to their original intentions.

----------------- ……………..

For the Principal For the Counterparty

Place ………………………. Witness 1: ……………………..

Date ………………………... Witness 2: ………………………


224

Appendix-XII

Proprietary Article Certificate (P.A.C)

PLL/PAC/ Location/Department/XX Date: XX/XX/20XX

Description of item _____________

It is certified that:

1) The equipment/ manuals/ services required are manufactured/ provided only by

M/s. ____________ No other make is acceptable as substitute for technical

reasons;

2) No suitable substitute exists for the item mentioned above in the warehouse.

Signature:

Name:

Designation:

Notes:

1) PAC Certificate shall be approved as per clause 4.6 of Section II.

2) The Approval for proprietary purchase may be taken from Competent Authority as per

the relevant DoA clause.


AMENDMENT TO C&P MANUAL

No. : MANUAL/AMENDMENT/01 Date: 9th May, 2020 Ref to C&P MANUAL :

Clause no. Description Page No. 40.1 Reverse Auction 97

Text given as:

“Reverse Auction is a procurement tool to obtain competitive price through multi bidding online negotiating amongst short-listed bidders. Through this process, the short listed bidders get an opportunity to reduce their prices online in a transparent and fair manner based on the evaluation methodology stipulated in tender document without the identity of bidders being disclosed either to other bidders or to officials of PLL. The entire process is designed to bring a complete transparency in the process as under:

i. Minimizes human involvement.ii. System offers greater insights into the current market prices.

iii. Gives equal opportunity to all short listed Bidders to be most competitive.iv. Help bidders to know respective price / position dynamically vis-a-vis the other bidders andprovide them an opportunity to react to it.

Reverse Auction shall be applicable in case of procurement of Bunker Fuel and procurement cases above INR 5 Cr. or for any other cases as approved by director concerned. However, Reverse Auction Shall not be applicable in case of EPC Contract. If Reverse Auction not to be done for any cases, then the same shall be approved by Concerned Director.

Is modified as follows:

Reverse Auction is a procurement tool to obtain competitive price through multi bidding online negotiating amongst short-listed bidders. Through this process, the short listed bidders get an opportunity to reduce their prices online in a transparent and fair manner based on the evaluation methodology stipulated in tender document without the identity of bidders being disclosed either to other bidders or to officials of PLL. The entire process is designed to bring a complete transparency in the process as under:

i. Minimizes human involvement.ii. System offers greater insights into the current market prices.

iii. Gives equal opportunity to all short listed Bidders to be most competitive.iv. Help bidders to know respective price / position dynamically vis-a-vis the other bidders andprovide them an opportunity to react to it.

Reverse Auction shall be applicable in case of procurement of Bunker Fuel and procurement cases (only for Material Purchase / Supply tenders) above INR 5 Cr. or for any other cases as approved by director concerned. However, Reverse Auction shall not be applicable in case of EPC Contract, Service and Works Contract, Proprietary/OEM Purchase. If Reverse Auction not to be done for any cases, then the same shall be approved by Concerned Director. Moreover, in case of any works contract where major portion is supply (75% and above of estimated cost) and rest portion is services then that contracts shall be considered as supply contracts and reverse auction shall be applicable.”

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