Annexures to MATERIAL MANAGEMENT

ANDPROCUREMENT MANUAL

For Ordnance Factories

ORDNANCE FACTORY BOARDKOLKATA

NOVEMBER 2005

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CONTENT

Annexure-1 Inter Factory Demand.Annexure-2 Bank Guarantee Format for furnishing EMD.Annexure-3 Bank Guarantee Proforma for furnishing Performance Security.Annexure-4 Form of letter to be addressed to Bank for verification of BG.Annexure-5 Format for refund of Security Deposit.Annexure-6 Extract of Rule 189 & 190 of Central Accounts Receipt and Payment.Annexure-7 Rule 190: Procedure for repayment of lapsed deposits.Annexure-8 Instruction of tender and Instruction to Tenderer (DGOF/MM-1)Annexure-9 Schedule to Tender (DGOF/MM-1B).Annexure-10 Annexure to Schedule to Tender (DGOF-1C ).Annexure-11 Tender (DGOF/MM-2).Annexure-12 Special Instruction to the Tender (DGOF/MM-3).Annexure-13 Compliance Statement (DGOF/MM-4).Annexure-14 Standard Format of supply Order.Annexure-15 Acknowledgement of A/T.Annexure-16 Instruction to Tenderer (DGOF/MM-16)Annexure-17 Special Instruction (DGOF/MM-27)Annexure-18 Tender Enquiry Advertisement (DGOF/MM-15)Annexure-19 Attendance Report for Tender Opening (DGOF/MM-18)Annexure-20 Spot Comparative Statement (DGOF/MM-19)Annexure-21 Data Sheet (DGOF/MM-22)Annexure-22 Measures for reducing advertisement cost. Annexure-23 Format for extension of DP(DGOF/MM-31) Annexure-24 Extension of DP (DGOF/MM-32) Annexure-25 Draft notice to supplier when supplies has neither acknowledged nor

Acted upon the DP ExtensionAnnexure-26 Extension of DP at reduced price.Annexure-27 Performance note for not submitted advance sample (DGOF/MM-30)Annexure-28 Letter for collecting additional information from the supplier after breach

Of contract.Annexure-29 Short closure and cancellation of S.O.(DGOF/MM-33)Annexure-30 Proforma for sanction of airlift.Annexure-31 Letter for final payment (DGOF/MM-34)Annexure-32 Closure of S.O.(DGOF/MM-37)Annexure-33 MofD letter dated 11.6.1973 on Provision Procedure. Annexure-34 OFB U.O.No. 10/6/mm dated 23.4.1999Annexure-35 OFB letter no. 517/vendor/MM dated 7.8.1985Annexure-36 OFB letter no. TU/TN/7401/Policy/Inventory dt. 21.5.1981Annexure-37 Member/P&MM circular no.10/6/mm dated 8.10.1982Annexure-38 Decentralization of Procurement of exclusive itemsAnnexure-39 Member/P&MM circular 10/6/MM dt. 30.12.1987Annexure-40 DDG/SP circular No. 14/4/LP/MM dt. 4.10.1988Annexure-41 Circular dated 27.12.90 from DDG/SP for purchase of ‘A’ class item under OFB’s power.Annexure-42 Mof D letter no. 4(14)/92-D(S-II) dated 7.8.92on placement of orders On production agency.Annexure-43 OFB circular no 14/4/LP/MM (VOL-XI) dated 7.6.95.

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Annexure-44 OFB letter no 14/4/LP/MM (P&C) DATED 2.1.2002.Annexure-45 OFB letter no 01/GENL/SP/3 dated 8.6.1990 on Procurement of imported

spares: FE release.Annexure-46 Clarifications on sale of NF-scrap to SSI units and export unitsAnnexure-47 Time frame for purchase case [single commercial bids]Annexure-48 Time frame for purchase cases {Two bid system}Annexure-49 Disposal of stores.

Annexure-50 Provisional payment of charged expenditure-revised procedure- regarding.Annexure-51 INCOTERMS – 2000Annexure-52 Standard form for intimating firms regarding rejection of their

offer.

Annexure-53 Demand Note (Form A) to firm when Arbitral award is in favour of purchaser.Annexure-54 Demand Note (Form B) to firm when the Arbitral award is against the

purchaser and it has been decided not to go for appeal.Annexure-55 SOP for Input Inspection.Annexure-56 SOP for Vendor Registration and capacity verification.Annexure-57 Procurement of stores on the basis of single vendor system.

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Annexure-1

INTER FACTORY DEMANDDate………..

No………………………….To The General Manager …………………….Factory(*…………………………/*Thro’ Inspector of………………………….)

Store Specification Drawing

OrPattern

NumberOr

Quantityrequired

Inspection by

Factory or Ins

Section

Date by which

required

(a) Open extract

(b) Issue Order(c ) Purchase &

Issue

PDC

The above mentioned stores are required. General Manager

Only when I.S.Inspection is required in which case Factoryan additional copy for retention by Inspector will be necessary Indentor

Concurred in

D.A.C.A.F.A

………………Factory (Indentor)

II

No………………. Date…………….

Accepted and returnedTo The G.M. GM ………………………Factory ……………….Factory (Indentor) (Supplier)

Copy to: The D.A.C.A.F.A………………….

…………….....Factory (Supplier)

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Annexure-2

BANK GUARANTEE FORMAT FOR FURNISHING EMD

Whereas……………………………………………………………………………………………. (hereinafter called the “tenderer”)

has submitted their offer dated …………for the supply of………………………………………………..

(hereinafter called the “tender”know all men by these presents that

we…………………………………………………………………….Of…………………………………having our registered office

at………………………………………… (hereinafter called the “bank” are bound unto…………………………………..in the sum of…………………………………………….. ( hereinafter called the “Purchaser”)for which payment will be truly to be made to the said purchaser, the bank binds itself, its successors and assigns by these presents. Sealed with the Common Seal of the said bank this……………….day of……...……………….19…/20…..THE CONDITIONS OF THIS OBLIGATION ARE:

(1) If the tenderer withdraws or amends, impairs or derogates from the tender in any respect within the period of validity of the tender.

(2) If the tenderer having been notified of the acceptance of his tender by the purchaser during the period of its validity.

a. If the tenderer fails to furnish the Performance Security for the due performance of the contract.

b. Fails or refuses to execute the contract.

We undertake to pay the purchaser up to the above amount upon receipt of its first written demand, without the purchaser having to substantiate its demand, provided that in its demand the Purchaser will note that the amount claimed by it is due to it owing to the occurrence of one or both the two conditions, specifying the occurred condition or conditions.

This guarantee will remain in force up to and including 45 days after the period of tender validity and any demand in respect thereof should reach the Bank not later than the above date.

……………………….(Signature of the Bank)

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Annexure-3BANK GUARANTEE PROFORMA FOR FURNISHING PERFORMANCE SECURITY

In consideration for the President of India (hereinafter called “the Government”) having agreed the exempt……………………………………(hereinafter called “the said Contractor (s)” from the demand, under the terms and conditions by an agreement dated…………………made between…………………………………and……………………..of Performance Security for the due fulfillment of the said contractor (s) of the terms and conditions contained in the said agreement on production of Bank Guarantee for Rs………………. (Rupees…………………………………….. (indicated in the name of the Bank)Bank”) at the request of…………………….Contractor (s) do hereby undertake to pay to the Government an amount not exceeding rs…………………… against any loss or damage caused to or suffered would be caused to or suffered by the Government by reason of any breach of the said Contractor (s) of any of the terms or conditions in the said agreement.

2. We ……………………… do hereby undertake to pay the amount due and payable under this Guarantees without any demur, merely on a demand from the Government stating that the amount claimed is due by way of loss or damage caused to or would be caus4ed to or suffered by the Government by reason of breach by the said contractor (s) of any of the terms and conditions contained in the said agreement or by reason of the contractor (s)’s failure to perform the said agreement. Any such demand made on the Bank shall be conclusive as regards the amount due and payable by the Bank under this guarantee. However, our liability under this guarantee shall be restricted to an amount not exceeding Rs…………………………..

3. We undertake to pay the Government any money so demanded notwithstanding any dispute or disputes raised by the contractor (s) / supplier (s) in any suit or proceeding pending before any court or Tribunal relating thereto liability under this present being absolute and unequivocal.

The payment so made by us under this Bond shall be a valid discharge of our liability for payment there under and the contractor (s) / supplier (s) shall have no claim against us for making such payment.

4. We ……………………. Further agree that the guarantee herein contained shall remain in full force and effect during the period that would be taken for the performance of the said Agreement and that it shall continue to be enforceable till all the dues of the Government under or by virtue of the said Agreement have been fully paid and its claim satisfied or discharged or till ……..that the terms and conditions of the said Agreement have been fully and properly carried out by the said Contractor (s) and accordingly discharges this uarantee. Unless a demand or claim under this uarantee is made on us in writing on or before the ……………….guarantee thereafter.

5. We …………………….further agree with the Government that the overnment shall have the fullest liberty without our consent and without affecting in any manner our obligations hereunder to vary any of the terms and conditions of the said Agreement or to extend time of performance by the said Contractor (s) from time to time or time or to postpone for any time or from time to time any of the powers excisable by the Government against the said contractor (s) and to forebear or enforce any of the terms and conditions relating to the said greement and we shall not be relieved from our liability by reason of any such variation or extension being granted to the said contractor (s) or for any forbearance, act or omission on the part of the Government or any indulgence by the Government to the

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said contractor (s) or by way such matter or thing whatsoever which under the law relating to sureties would, but for this provision, have effect of so relieving us.

6. Notwithstanding anything contained herein above our liability under the guarantee is restricted to Rs……………….. and shall remain in force until. Unless a claim or suit under this guarantee if filed with us on or before ………………. ALL OUR RIGHTS UNDER THE GUARANTEE SHALL BE FOREFEITED and the Bank shall be relieved and discharged from all liabilities therein.

7. This Guarantee will not be discharged due to the change in the constitution of the Bank or the Contractor (s)/ Supplier (s).

8. We, …………………….. lastly undertake not to revoke this Guarantee during its currency except with the previous consent of the Government in writing.

Dated the …………………………… date of …………………….. 1999/2000 For…………………………………………………... ( indicate the name of Bank ) Signature……………………………………………. Name of the officer…………………………………. ( in block capital)

Designation of Code No……………………………………..

Name of the Bank and Branch……………………

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Annexure-4FORM OF LETTER TO BE ADDRESSED TO BANK FOR VERIFICATION OF

BANK GUARANTEE

REGISTERED ACKNOWLEDGEMENT DUE

To ……………………………..i) Bank Concerned ……………………………..ii) head office of the Bank

Sub: Bank Guarantee- Verification of.

Sir,

With reference to our Contract No…………………………………placed on ………………… a Bank Guarantee No…………………….dated……………..for Rs……………issued from…………. Bank located at ………………….(Photostat copy of Bank Guarantee enclosed) has been received.

It is requested that the genuineness of the Bank Guarantee may be verified and intimated to the undersigned at the earliest.

Encl. : As above.

Yours faithfully,

( )For and on behalf of the Purchaser

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Annexure-5FORMAT FOR REFUND OF SECURITY DEPOSIT

To The………………………….. (Purchase Officer) ………………………………. ……………………………….

Sir, This refund of Performance Security Deposit amounting to Rs………………...(Rupees……………….. only) against us and therefore its repayment may please be arranged. Necessary receipt duly stamped is given hereunder in Part-B.

It is certified that I/ We, have not received any complaints from the consignees regarding non-receipt, shortage or defects in the stores supplied under the contract.

(Signature of the Contractor)

PART-B

Received from ………………… the sum of Rs………………amount in refund of my/ our Performance Security Deposit in full in respect of-

Contract No………………………………………………………………Station……………………………………………………………………Dated…………………………….. (Contractor’s dated signature)( Revenue Stamp for sums exceeding Rs. 20/- should be affixed )

PART-C

( TO BE FILLED BY THE PURCHASE OFFICER )

It is certified that no demands against the above contractor are outstanding in the record of this office and that the instant Security Deposit is free from Government Claims in terms of clause 7(4), 18 and 18A of General Conditions of Contract as far as A/T No……………….. is concerned and can be refunded to the Contractor by A/c Payee Cheque.

Signature……………………….Designation…………………….

PART-D

( FOR USE IN ACCOUNTS OFFICE )

Pay Rs……………………………………….(Rupees………………………………)

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Annexure-6EXTRACT OF RULES 189 AND 190 OF CENTRAL ACCOUNTS

RECEIPT AND PAYMENT

“Rule 189. LAPSED DEPOSITS- (1) At the close of March every year.

(a) deposits not exceeding twenty-five rupees unclaimed for one whole account year, or residuary balances not exceeding the said amount out of deposits partly repaid during the year then closing and

(b) all deposits or balances in excess of the aforesaid amount, unclaimed fpr more than three complete account years, shall be credited to the Government under the Consolidated Fund, keeping necessary note in the register of deposits. In the case of deposits, the detailed accounts of which are kept by departmental officers, a list of deposits and balances thus lapsing shall be prepared by them and sent to the Accounts officer in accordance with the relevant directions.

NOTE 1: For the purpose of this rule, the age of a repayable item or of a balance of it. May be reckoned as dating from the time when the item or the balance, as the case may be, was initially deposited. If, however, a repayable item deposited by a party in connection with a contract or supply order is on request, decided to be reckoned as deposit against a subsequent contract or supply order awarded to the same party, the age of the item will be calculated with reference to the date of the latter.

NOTE 2 : (1) Such of the deposits (or balances of deposits ) referred to in (b) of sub-rule (1) which pertains to contract, supply order that are under litigation or arbitration shall not be deemed as “ unclaimed deposits” for the purpose of crediting to Government under this rule. They should, nevertheless, be listed out distinctly along with relevant particulars so as to facilitate action for releasing the deposit, or for forfeiting it, depending on the judgement or award at the conclusion of the litigation or arbitration. Relevant xlaim will require pre-check by the Accounts Officer before repayment.

(2) However, in the case of certain departments such as Central Public Works department and Salt Department, which maintain detailed account of deposits themselves, the age for the purpose shall be reckoned with reference to the provisions in the concerned authorized departmental regulations.

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Annexure-7RULE 190: PROCEDURE FOR REPAYMENT OF LAPSED DEPOSITS

(1) Deposits, the detailed accounts of which are required to be kept by the departmental officer and which are credited to Government under provisions of Rule 189 cannot be repaid without pre-check by the Accounts Officer. On receipt of bill in Form GAR 46 (along with the original departmental receipts issued to the refundees) from the departmental officer concerned, the Accounts Officer will pass the bill after checking that the item is covered to the credit of Government and that the claimant’s identity and title to the money are certified by the departmental officer who signs the application for the refund. The amount of the bill may, wherever necessary, be paid to the departmental officer on affixing his signature in token of receipt in the space provided for “Claimants’ signature” in the bill after scoring these words.

(2) Deposits, the detailed accounts of which are kept in the accounts office and which are credited to the Government under Rule 189, may be refunded on receipt of an application-cum-bill in Form G A R 46 (along with the original challan or departmental receipt as the case may be ) from the departmental officer after verifying that the item was really received, is traceable in his records and was carried to the credit of the Government as lapsed and was not paid previously and that the claimant’s identity and title to the money are certified by the officer countersigning the application for the refunds.

(3) The repayment of lapsed deposit shall be recorded in the appropriate deposit register of receipts so as to guard against a second payment. If the payment is made after the Register of Receipts has been destroyed, the responsibility for verifying the claimant’s title to the refund shall devolve on the authority who signs application-cum-bill in Form G A R 46”.

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Annexture-8Form No: D.G.O.F./MM-1

INVITATION TO TENDER AND INSTRUCTIONS TO TENDERERS

Note: The envelope containing the tenders as well as all subsequent communications should be addressed and delivered to

Telegraphic address (General Manager of tender issuing factory):

All communications must be addressed to the officer named above by TITLE only and not by name.Dear Sirs, On behalf of the President of India, I invite you to tender for the supply of stores detailed in the said schedule. The conditions of contract, which govern any contract made, are those contained in form DGS&D 68( Revised )( excluding clause 24 ) included in the pamphlet entitled “Conditions of Contract governing contracts placed by the Central Purchase Organization of the Government of India” as amended up-to-date ( and the special conditions detailed in the tender form and those attached herewith). If you are in a position to quote for supply in accordance with the requirements stated in the attached schedule, please submit your quotation to this office on the prescribed tender form attached.

Only in exceptional cases and for adequate reasons will telegraphic or letter quotations be considered if they are received from firms who are in the approved list of registered suppliers maintained by this Directorate General and DGS&D provided case telegraphic or letter quotations are complete in all respects with regard to price ( itemized prices where necessary ) specifications, survey and other particulars essential to enable a purchase decision to be taken and provided also the quotations are confirmed within three days from the due date of receipt of tender in the prescribed form.

2. Particulars, specifications and drawings : (i) The sources from which standard particulars specifications and drawing can be had are detailed in schedule to tender.

(a) Specifications and drawings which are not priced publications and marked: “Returnable” and certified samples issued in connection with the tender should be returned in perfect order with the tender or separately within the due date of tender when co-tender is submitted. In the event of default, the tender submitted may not be considered and in addition the defaulting firm will be held liable forthwith to pay the purchaser, as damages either the sum of Rs.20 or three times the value of the same whichever is higher. Nevertheless even on such payment the firm or tenderer will not entitled to retain the specifications/Drawings and /or samples. These will be re-issued to the contractor with whom the contract is made and he will be responsible for their return after the completion of the contract under the relevant clause of the “Conditions of Contract Form DGS&D-68 (Revised)” (excluding clause 24).

3. Preparation of Tender: (a) The schedule to the tender form should be returned intact whether you are quoting for any item or not. Pages should not be detached but when items are not being tendered for the correspondence space should be defaced by some such words as “Not Quoting”.

(b) In the event of spares on the scheduled form being insufficient for the required purpose, additional pages may be added, but such additional pages must be numbered consecutively bearing the Tender number and be fully signed by you. In such cases reference to the additional pages must be made in the tender form.

(c) If any modification in the schedule is considered necessary you should communicate the same by means of a separate item sent with the tender.

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4. Signing of Tender: (a) The tender is liable to be ignored if complete information is not given therein or if the particulars and data (if any) asked for in the schedule to the Tender are not fully filled in. Specification must be paid to the delivery dates and also the General conditions of the contract as form No. DGS&D -68(Revised) (Excluding Clauses 24) as the contract should be governed by them. (b) Individual signing the tender or other documents connected with a contract must specify whether he signs as:

(i) A ‘Sole Proprietor’ of the firm or constituted attorney of such sole proprietor.

(ii) A partner of the firm if it be a partnership, in which case he must have authority to arbitration disputes concerning the business of partnership either by virtue of the partnership agreement or a power of attorney;

(iii) Constituted attorney of the firm if it is a company. N.B.: I. In case of (ii) a copy of the partnership agreement or general power of attorney in either case attested by a Notary public, should be furnished unless the same has been previously furnished to this Directorate General, or affidavit on stamped paper of all the partners admitting execution of the partnership agreement or the general power of attorney should be furnished.

II. In case of partnership firms, where no authority to refer disputes concerning the business of the partnership has been conferred on any partner, the tender and all other related documents must be signed by every partner of the firms.

III. A person signing the tender form or any documents forming part of the contract on behalf of another shall be deemed to warranty that he has authority to buy such other and if on enquiry it appears that the person so signing had no authority to do so the purchaser may, without prejudice to other Civil and criminal remedies cancel the contract hold the signatory liable for all cost and damages.IV Each page of the tender, schedule to tender annexure, if any, should be signed by the tenderer.

5. Delivery of Tender : The original copy of the tender is to be enclosed in a double cover. The inner cover should be sealed and should be super scribed with Tender No. and Date of Opening. The outer cover should bear only address of this office without any indication that there is a tender within. Right is reserved to ignore any tender which fails to comply with the above instructions. All outstation tenders should be sent by registered post. Only one tender should be included in one cover. Where more than one tender are included in a cover, all tenders so enclosed in one cover will be liable to be ignored.

6. Latest Hour for Receipt of Tenders : (i) Your tender must reach this office not later than the time & date mentioned in the

NIT for receipt of the tender. Tenders sent by hand delivery should be dropped in the tender box at this office not later than the due Time & date stipulated for opening in the NIT.

(ii) Tenders sent by FAX will not be considered unless it is backed up by ink signed copy within seven days. To avoid any complications with regard to Late Receipt / Non receipt of Tenders it may please be noted that responsibility rests with the tenderers to ensure that Tenders reach this office before due date of receipt. Late quotes will be rejected out rightly. (iii) In case your firm is not willing to quote due to any reason whatsoever, your regret should be faxed well before the due date.

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7. Period for which the Offer will remain open :(i) Firm tendering should note the period for which it is desired that their offer should remain open for acceptance. If the firms are unable to keep their offer open for the specific period they should specifically state the period for which their offers are open but they must realize that such a provision may prevent their offer from being considered provided, however, in case the day up to which the offer is to remain open happens to be a closed holiday for Government offices, including Sunday the offer shall remain open for acceptance till next working day.

(ii) Quotations qualified by such vague and indefinite expressions as “Subject to immediate acceptance”, “Subject to prior sale” will not be considered. 8. Opening of Tenders :

You are at liberty to present or authorize a representative to be present at the opening of the tender at the time and date as specified in the schedule. The name and address of the representative who would be attending the opening of the tender on your behalf should be indicated in your tender. Please also state the name and address of your permanent representative, if any.

9. Price: I (i) The price quoted must be net per unit shown in the schedule and must include all packing, transport and delivery charges. Refunds on account of returnable packages (if any) are to be separately specified, Prices and refunds must be clearly shown in figures and words in Indian Currency. In case of discrepancy between words and figure, prices in words shall prevail. (ii) The price quoted must be firm and fixed unless otherwise stated and a price variation formula provided in the Additional Terms and Conditions issued along with the NIT. (iii) The price must be stated for each item separately. The percentage of reduction in the total price for the entire demand should also be quoted, should an order to that extent be placed with you.

(ii) Units: When quotations are made for units other than those specified in the schedule the relationship between the two should be stated in the tender.

II. (i) If it is decided to ask for excise duty or any other charges as extra, the same must be specifically stated. In the absence of any such stipulation it will be presumed that the prices include all such charges and no claim for the same will be entertained.

(ii) If it is desired by the tenderer to ask for Sales Tax to be paid an extra the same must be specifically stated. In the absence of any such stipulation it will be presumed that the prices quoted by the tenderers are inclusive of Sales Tax no liability for payment of Sales Tax will be devolved upon the purchaser.

(iii) On tenders quoting Sales Tax extra, Sales Tax will be paid to the seller at the rate at which it is liable to be assessed or has actually been assessed provided the transaction of sale is legally liable to Sales Tax and the same is payable as per the terms of the contract.

10. Terms of Delivery: (a) The delivery of stores is required by date(s) specified in the schedule to tender. Time shall be the essence of contract. If however, it is not possible for you to affect delivery by the date(s) you should specify the date by which you can guarantee delivery in the prescribed schedule to the tender.

(b) Contract can be cancelled unilaterally by the buyer in case items are not received within the contracted delivery period. Extension of contracted delivery period will be at the sole discretion of the Buyer, which will be either with or without applicability of L.D. clause. Liquidated

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Damages @ 0.5% per week or part thereof subject to a maximum of 5% of the cost of undelivered stores will be recovered in case of delay in delivery beyond the accepted delivery period.

(c) Preference will be given to those offers supplying within the prescribed delivery schedule. 11. Samples: Tender samples are not required unless specifically called for.

QUOTATIONS WITHOUT SAMPLES WHERE SAMPLES ARE SPECIFICALLY CALLED FOR ARE LIABLE TO BE IGNORED: Samples of what your offer to supply should not be less than the quantity necessary for test as per specification if any or in the schedule of Tender. In case the quantity of sample required for the test is given either in specification or in the schedule to tender this should be adhered to. Each sample should have a card affixed to it giving particulars of : (a) Your name and address; (b) Tender No.; (c) Date of opening of Tender; (d) Item No. against which tender submitted; (e) Any other description, if necessary, written clearly on it.

The samples should be sent to the Inspector or other Officer (named in the schedule to tender) to reach him by the date specified in the schedule. The cost and freight of sending the samples shall be borne by you and there will be no obligation on the part of the receiving officer for their safe custody. Tenderers who do not submit the samples or the testing fee, if any, required for the testing both samples by the time specified in the schedule will run the risk of their tenders being ignored.

Samples sent ‘freight to pay’ will not be accepted. The packages and the Rly. Receipt should be addressed to the Inspecting Officer or other officer concerned and not to ‘self’. If the samples are sent by Railway Parcel, the Railway receipt should not be enclosed with the Tender documents but should be posted separately to the office to whom the samples are sent ( under a covering letter giving the necessary particulars to enable him to connect the Railway receipt easily with the parcel ) Samples submitted by the Tenderers, whose offers are not accepted provided they have not been destroyed during testing ) Will be delivered to their representative if they call for the same or can be returned direct to them at their cost provided the application for return is made to the officer to whom the samples are sent, within one month after the contract is placed on the successful tenderer, or after notification of cancellation of demand. If no application is received within the date, the samples will be disposed of by public auction and the sale proceeds credited to the Government.

12. Examination of Patterns of certified samples: When sealed patterns of stores are mentioned in the schedule to the tender form or specification these or certified samples thereof, may be seen at the place started in the schedule to tender and should be examined by a competent person on your behalf (who should take this invitation with him) before the tender is submitted.

13. Quality Assurance: After the contract is negotiated, the firm will be provided the Standard Acceptance Test procedure (ATP). Inspecting Authority reserves the right to modify the ATP when the Inspection Authority would accept necessary item subject to evaluation and clearance. Firm would be required to provide all test facilities at OEM premises for acceptance & inspection. The details in this regard will be coordinated during the negotiation of contract. The item should be of latest manufacture conforming to the current production standard having 100% defined life at the time of delivery.

14. Mode of Payment: Preferred mode of payment shall be e-payment (ECS/ EFT/ RTGS) wherever available.

15. Packing: Unless a method of packing is indicated in this specification or on the schedule to the tender form the method of packing which the contractor proposes to employ must be described in the schedule to Tender Form. Contractors are at liberty to quote for additional alternative sizes and description of packs and these must be described in the schedule to Tender.

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16. Right of Acceptance: This office does not pledge itself to accept the lowest or any tender and reserves to itself the right of acceptance the whole or any part of the tender or portion of the quantity offered and you shall supply the same at the rate quoted. You are at liberty to tender for the whole or any portion or to state in the tender that the rate quoted shall apply only if the entire quantity is taken from you.

17. Communication of Acceptance: Acceptance by the purchaser will be communicated by FAX, Telex, telegram, express letter of acceptance or formal,’Acceptance of tender’. In cases where acceptance communicated by FAX, Telex, telegram or express letter , the formal acceptance of tender will be forwarded to you as soon as possible but the instruction contained in the FAX, Telex, telegram or express letter should be acted upon immediately.

18. Security Deposits: In the form of Demand Drafts, Treasury Receipts etc.should be drawn in the name of concerned CFA (Fys).

19. This tender is not transferable.

For & on behalf of the President of India.

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Annexure-9Form No: D.G.O.F./MM-1B

SCHEDULE TO TENDER

TIME AND DATE OF OPENING OF TENDER (see tender notice)_________________

The Tender shall remain open for acceptance till 90 days from date of opening

Item ! Description Specification No. Number or Price per Station of RemarksNo. ! of Stores /sealed pattern No. Quantity Unit Unit Dispatch (i) ! (ii) (iii) (iv) (v) (vi) (vii) (viii)

(The Instructions and conditions applicable to this tender are attached to this schedule)Mention here exact date up to which the Tender will remain valid___________________

NOTES

(i). Tender sample -Analysis reports on Tender samples will not be furnished(ii). Quantities offered by tenders – Tenderers should, if not in a position to quote for entire quantity and for delivery as required, state specifically the quantities which can deliver at the price quoted and according to the required delivery. Since on the point will entail responsibility for supply at quoted of full quantities.(iii) Alternate Packing where alternate packs are given, tenderers must quote prices for all alternatives given otherwise it will be assumed that they are unable or unwilling to supply in the pack for which they do not quote. No further reference will be made to them on the subject.

TENDERERS MUST GIVE SPECIFIC ANSWERS AGAINST EACH OF THE FOLLOWING QUESTIONS. TENDERS CONTAINING EQUIVOCAL OR EVASIVE REPLIES WILL BE IGNORED.

1. Whether stores offered fully conform to technical particulars and the specification/ Drawing specified by the purchaser in the schedule to Invitation to Tender. If not, details of deviation should be stated here.

2. (i) Brand(ii) Name and Address of Manufacture(iii) Station of Manufacture

3. Guaranteed date by which delivery can be completed.4. Packing that is proposed to employ

Whether specification for packing will be adhered to? 5. Whether Sample submitted?

6. Gross Weight of consignment.Net weight of each item.

7. Whether you agree to the inspection clause as stipulated?8. Stock in hand at the present time consists of:- (a) Held by us_______________________

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(b) Held by S/S/_____________________over which we have secured an option. 9. Stock on route to India. 10. If the stores offered are manufactured in India whether all the raw materials, components,

etc. used in their manufacture are also produced in India? If not given details of materials, components, etc. That are imported and their countries of origin. A clear break up of the Indigenous and imported components together with their value and the proportions it bears to be total value of the stores should also be given.

11. Raw materials are held in stock sufficient for the manufacture of______________12. Here state specifically whether the price tendered by you is to the best of your knowledge

and belief no-more than the price which is permissible for you to charge a private purchaser for same class and description of goods under the Provision of any law for the time being in force. If not, state the reasons and the margin of profit included.

13. Business name and constitution of tendering firm. Is the firm registered under:-(i) The Indian Companies Act, 1966?(ii) The Indian Partnership Act, 1932? (please give names of partners)(iii) Any Act. If not, who are owners? (please give full name)

12. Do you agree to sole arbitration of Director General of Ordnance Factories or by an officer to be appointed by D.G.O.F. on the lines indicated in special conditions (clause B-2 of DGOF/MM-3).

(Your acceptance or non-acceptance of this clause will not influence the decision of the tender. It should however, be noted that an commission to answer the above question will be deemed as an connection of the clause)

(For partnership firms whether registered under Indian Partnership Act, 1932) should be answer to this question by a partnership firm be in the affirmative, please state

further.(a) Whether by the partnership agreement, authority to refer disputes concerning the

business of the partnerships to arbitration has been conferred on the partner who has signed the tender?

(b) If the answer to (a) is in the negative whether there is any general power of attorney executed by all the partners of the firm authorizing the partner who has signed the tender to refer dispute concerning business of the partnership to arbitration?

(c ) If the answer to either (a) or (b) is in the affirmative, have you already furnished a copy of either the partnership agreement or the general power of attorney as the case may be, to DGOF? Please quote the reference to the communication by which this was done.

N.B:- 1. If a copy of neither the partnership agreement nor the general power of attorney has previously been furnished to the DGOF, please attach to the tender a copy of either document on which reliance is placed for authority of partners or the partner signing the tender to refer disputes to arbitration. The copy should be attested by a Notary public or its execution should be admitted by affidavit on a properly stamped paper by all the partners.

2. Whether authority to refer disputes to arbitration has not been given to the partner signing the tender the tender must be signed by every partner of the firm.

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Annexure-10Form No: D.G.O.F./MM-1C

ANNEXURE TO SCHEDULE TO TENDER(to be returned by tenderers along with the tender duly signed)

1. Genera l : Tenderers should furnish a clear declaration as follows:

I/We declare that I am/we are: (i) Manufacturers; (ii) Manufacturer’s authorized Agents (iii) Holders in stock of the stores tendered for. (strike out which is not applicable) 2. Conditions of Contract :

Printed or cyclostyled or such terms and conditions of the tender will not be considered as forming part of their tender. Tendering firms should quote on the basis of the conditions referred to in Para 1 of the Invitation to tender and Instructions to Tenderers. In case any terms and conditions of contract applicable to this Invitation to Tender are not acceptable to the tendering firms they should specifically state deviation there from in the body of their tender.

3. Deviation from Specification: It is in the interest of the tenderers to study the specification, drawing etc, specified in

the tender schedule thoroughly before quoting so that if any deviations are made by the tenderers the same are prominently brought out in the body of their tender.

4. Price:

(a) Price must be in terms of new coinage system, viz. Rupees and Paise.

(b)This unit prices should be for the same units indicated in the schedule to tender enquiry and not any other unit.

(c) Prices quoted should be invariably for delivery+ F.O.R. Station of Destination or dispatch in India and inclusive of charges such as pack9isng, forwarding, custom duty, etc, etc. where applicable.

(d) Quantity discount, if any, should be indicated prominently.

(e) The F.O.R. Station of Dispatch prices shall be deemed to include free delivery to the consignee situated within municipal corporation limits/ a radius of 10 Kilometers from the firm’s premises in case of local delivery.

(i) Offers should be on firm and fixed price basis; unless otherwise specified in the Additional Terms and Conditions issued along with the T.E.

(ii) Where firms cannot quote firm prices variable prices with formula and a ceiling are preferred.

(iii) Where wages escalator is insisted upon, due consideration is given to the offer with lowest wages escalator factor.

5. Custom Duty:(i) For imported stores offered against forward delivery, the tenderers shall quote prices thereof exclusive of customs duty. The tenderers shall specify separately the c.i.f. price and the total amount of customs duty payable. They will also indicate correctly the rate of customs duty applicable along with Indian Customs Tariff Number. Customs duty as actually paid will be

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reimbursed on production of the necessary documents i.e. (i) triplicate copy of the Bill of Entry (ii) Copy of Bill of Loading and (iii) a copy of foreign principal’s Invoice. Where, however, the tenderer imports the stores in question against his own commercial quota import License, he will also be required to submit, in addition to the triplicate copy of the Bill of Entry etc. a certificate from his internal Audito5r on the bill itself to the effect that the following item(s)/quantities in the Bill of Entry relate to the stores imported against DGOF/GM, O.FYs’ ContractNumber: dtd.

(ii) Subsequent to the reimbursement of customs duty, the tenderer shall submit to the concerned C of A (Fys.) A.O. a certificate from his statutory Auditor after the annual audit of his accounts to the effect that he has not obtained any refund of the customs duty subsequent to the payment of duty to the Customs authorities by him. In addition, he shall also submit to the C of A (Fys.) A.O. concerned a certificate from firm’s Director/Manager/Proprietor/Accountant immediately after a period of three months from the date of payment of the duty of Custom Authorities to the effect that he has not applied for any refund to the customs duty subsequent of the Payment of duty to the Custom Authorities by him. (iii) In case the tenderer obtains any refunds of custom duty subsequent to the payment of the same by him to the customs Authorities and reimbursement of the custom duty to him by Cof A(Fys)/A.O he shall forthwith furnish the details of the refund obtained and afford full credit of the same to the purchaser.6. Transit Insurance: The purchaser will not pay separately for transit insurance and the supplier will be responsible till the entire, stores contracted for arrive in good condition at destination.

The consignee, will, as soon as possible but not later than 30b days of the date of arrival of stores at destination notify the contractor of any loss or damage to the stores that may have occurred during transit. Tenders/quotations, in which transit insurance cost has been claimed as an extra, may not be considered. 7. Price preference for earlier delivery: It should be noted that if a contract is placed on a higher tenderer as a result of this Invitation to tender in preference to the lowest acceptable offer in consideration of offer of earlier delivery, the contractor will be liable to pay to the Government the difference between the contract rate and that of the lowest acceptable tender on the basis of the final price F.O.R. Destination including all elements of freight, sales taxes, local taxes, duties, and other incidentals in case of failure to complete supplies in terms of such contract within the date of delivery specified in the tender and incorporated in the contract. This is in addition to and without prejudice to other rights of the Govt. To recover all other losses and damages resulting from delayed supplies and of cancellation and risk purchase in case of failure to supply the stores. In the event of risk purchase against such a contract the contractor will be liable to pay to the Govt. as extra expenditure incur5red, difference between the rate quoted by the lowest acceptable tenderer against the present tender and that at which the risk purchase contract has been concluded. 8. Payment Terms:

The standard terms of payments as embodied in the general conditions of contract and / or special conditions of contract will apply and no relaxation will be possible. If payment is desired to be made to the contractor’s bankers or other parties, the endorsement must be completed on the bill form and signed separately and the word ‘Self’ scored out. In addition, a power of attorney or transfer deed will be necessary in such cases conferring authority on the Bankers or the party concerned to receive payment on behalf of the contractor. Preferred mode of payment shall be e-payment (ECS/EFT/RTGS) wherever available.

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9. Import Recommendation Certificate:

(a) In case of imported stores on forward delivery basis, preference will be given to tenderers who do not require the assistance from DGOF for obtaining Import license. The tenderers must invariably state if recommendation for Import license is require. In the absence of any information in this respect it will be assumed that no special recommendation for import license is required by the tenderers. Tenderers who quote subject to such assistance should indicate the net C.I.F. value on which their rupee quotation is based (i.e. exclusive of profit, rebate or discount etc.).

(b) Tenderers should specifically indicate in their tender, the number of quantity against each item or which they seek the recommendation of this office for special Import license.

( c ) Tenderers should note that Government do not undertake to grant an Import license where it may be required for the supply of the stores detailed in the Schedule attached to the Tender form enclosed herewith and that the acceptance of any tender shall not imply such an undertaking on the part of the Government. To enable the Import of stores or components expeditiously for supply against any contract which may be concluded, an import Recommendation certificate may, however, be issued to the successful tenderer

In order to facilitate expeditious Issue of adhoc Import license against any contract that may be concluded the successful tenderer shall be required to attach with his application to the DGFT/Iron & Steel Controller/Department of Technical Development ( D.O. Tools ) in his own interest a schedule in quintuplicate in the proforma given below in addition to other usual documents. The application for license will be required to indicate the CIF value, breakdown, by individual ITC Serial No.

Description of goods covered by Import license No. ( To be given by the licensing authority ).

Item No. Description of goods ITC Schedule No. C.I.F. Value Quantity

For application to DGFT only.

The successful tenderer to whom Import Recommendation Certificate is issued must apply for Import license immediately and in (no case later than 15 days from the date of issue of the Import Recommendation Certificate, under advice to the) DGOF, Calcutta.

Tenderers should note that any Import license issued against any contract that may be concluded will indicate ‘quantity’ as the limiting factor for the purpose of clearance from the customs. A license will not be valid for clearance if the actual c.i.f. value exceeds that shown in the license. If, however, any increase in c.i.f. value is desired, a request for amendment will have to be submitted along with the Import license well before its expiry and before shipment of the goods duly supported by reasons and documentary evidence.

All tenderers are warned ( in the event of a contract being concluded with any of them ) that any shipment made before the date of issue of an import license or after its expiry is treated as unauthorized, similarly, if the conditions of the license are not fulfilled, the import are deemed to be unauthorized. Unauthorized Importation of goods is an offence and is a matter for adjudication by the Customs Authorities in which the Imports Trade Control Authorities cannot interfere. No

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representation in this behalf will therefore be entertained and the party will be required to deal with Customs authorities direct in the matter.

10. Unregistered Tenderers:

Tenderers not borne on the approved list of contractors maintained by this Department shall submit along with their tenders:

(i) An Income Tax Clearance Certificate (duly countersigned by the Income Tax Officer of the circle concerned under the seal of his office).

(ii ) Name & Full Address of their Banker.

(iii) Performance statement in the following proforma duly signed by them regarding supplies made by them against contract received from the DGS&D/DGOF for similar stores for the past three years. In case the tenderer has not secured any contract during the past three year, he should give the performance against earlier contracts placed on him, if any.

Proforma for performance statement (vide 10(iii) above

Sl.No.

A/T No. and date

Total Qty. against eachA/T

Date of Deliveryspecified in the A/TA/T

Actual dateof delivery

REMARKS(Here mention reasons for not adhering to the original delivery date )

(iv) The equipment they possess for the manufacture of the stores and for the quality control in the following proforma : Note:- Tenders not containing the above particulars are liable to be ignored.

Proforma for Equipment and quality Control (vide 10(iv) above)(To be submitted in Triplicate)

Reference: DGOF/GM O.F. Tender No….. Date: for supply of ……

1. Name and address of the Firm:

2. (a) Telephone No. Office/Factory/Works: (b) Telegraphic address:

3. Location of Manufacturing Works/Factory/Factories owned by you (Documentary evidence of ownership must be produced).

4. Brief description of Factory)e.g. area, covered accommodation, departments into which it is divided laboratory etc.)

5. Organization (whether registered: under Indian Factories/Companies Act, Supervision management etc.).

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6. Whether in firm comes under the scope of Industries( Development andRegistrations) Act 1951, and if so the No act date of registration of lines held under the act.

7. Details of plant and Machinery erected and functioning in each Department (monographs and descriptive pamphlets should be supplied, if available).

8. Whether the process of manufacture in the factory is carried out with the aid ofPower or without:

9. Details & stocks of raw material held. State whether imported or indigenous against each item.

10. Details of stores under5 manufacture, (Specifying each item separately).

11. (a) Details of stores or class of stores which the factory, as equipped is capable ofProduction (Specifying each item separately). b) Stores for which registration is sought.

12. Production capacity of each item with the existing plant and machinery.(a) Normal (b) Maximum

12. Details of arrangements for quality control of products such as laboratory etc.

14. (a) Details of Technical Supervisory staff in-charge of production and quality control. (b) Skilled labour employed

(c) Unskilled labour employed (d) Max. No. of workers (skilled and unskilled) employed on any day during the 12

months of preceding the date of application.

15. Whether there is scope for expansion and to what extant :

16. Whether stores were tested to any standard specification, if so, copies of original test certificates should be submitted in triplicate.

Place: Signature of Tenderer Date:N.B. (1) Details under columns 7 to 15 inclusive need be restricted to the extent they pertain to the item(s) under reference.

(2) Details of previous orders and /or existing commitments with government or with others in respective of the item under reference or similar items which depend on the same capacity should be given in the following proforma signed by them:

Sl.No. Order No. and date Date of receipt Description of Quantity Value and the authority of order stores Placing the order ------------------------------------------------------------------------------------------------------------ 1 2 3 4 5 6 ------------------------------------------------------------------------------------------------------------

------------------------------------------------------------------------------------------------------------Due date of Date material Dispatch No. of extensions REMARKSdelivery delivered particulars to the delivery Obtained ------------------------------------------------------------------------------------------------------------

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7 8 9 10 1111. Price Variation on account of variation in the price of input materials:

The price quoted must be firm and fixed unless otherwise stated and a price variation formula provided in the Additional Terms and Conditions issued along with the NIT. The successful tenderer shall produce voucher for the input materials purchased in support of his claim for variation in price due to change in price of input materials. Tenderers of such tenders as are not agreeable to produce vouchers are liable to be ignored.

12. Guarantee/ Warranty :

The tenderers shall furnish along with their quotations the under noted Guarantee/ warranty: (i) Guarantee that they will supply spare Parts if and when required on the agreed basis for an

agreed price. The agreed basis could be an agreed discount on the published catalogues or on agreed, percentage of profit on the landed cost.;

(ii) Warranty to the effect that before going out of production for the spare parts they will give adequate advance notice to the purchaser of the equipment so that the latter may undertake the balance of the life requirements (;)

(iii) The warranty to the effect that they will make available the blue prints of drawing

(iv) The contractor shall furnish the following warranty in case contract isplaced on him.

The contractor/seller hereby declares that the goods/stores/articles sold to the buyer under this contract shall be of the best quality and workmanship and shall be strictly in accordance with the specifications and particulars contained/mentioned in the clause…… hereof and the contractor/seller hereby guarantees, that the said goods/stores/articles would continue to conform to the description and quality aforesaid for period of ……….days/months from the date of delivery of the said goods/stores articles to the purchaser and that not withstanding the facts that the purchaser (Inspector ) may have inspected and /or approved the said goods/stores/articles, if during the aforesaid period of …….days/months the said goods/stores/articles be discovere4d not to conform to the description and quality aforesaid or have deteriorated ( and the decision of the Purchaser in that behalf will be final and conclusive ) the Purchaser will be entitled to reject the said goods/stores/articles or such portion thereof as may be discovered not to conform to the said description and quality. On such rejection and goods/stores/articles will be at the seller's risk and all the herein contained relating to rejection of goods etc. shall apply. The contractor of/ seller shall, if so, called upon to replace within a period of ………… months or such further period as may be extended from time to time by the purchaser and in such an event the above mentioned warranty period shall apply to the goods/stores articles replaced from the date of the replacement thereof, otherwise the contractor/seller shall pay to the purchaser such damages as may rise by reason of the breach of the conditions therein contained, nothing herein contained shall prejudice any other right of the purchaser in that behalf under this contract or otherwise.

13. Jurisdiction :

All questions, disputes or differences arising under out of or in connection withthe contract, if concluded shall be subject to the exclusive jurisdiction of the court-within the local limits of whose jurisdiction the place from which the Acceptance of Tender is issued, is situated.

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Signature of Tenderer

Annexure-11

Form No: D.G.O.F./MM-2TENDER No.

Full name and address of the Tenderer, in addition to Post Box No. if any, should be quoted in all communications to this office. Contractor’s Telegraphic Address Telephone no. Code used

From __________________________________ __________________________________ To, The Director General Ordnance Factories, Kolkata. I/ We hereby offer to supply the stores detailed in the schedule hereto or such portion

thereof as you may specify in the acceptance of Tender at the price given in the said schedule and agree to hold the offer open till______________. I/We shall be bound by the communication of acceptance dispatched within the prescribed time.

2. I/We have understood the Instructions to Tenderers and conditions of contract in the form no. D.G.S &D –68 (Revised)(excluding clause 24) included in the pamphlet entitled “Condition of Contract governing contracts placed by the D.G.O.F and have thoroughly examined the specification drawing and/ or pattern quoted in the schedule hereto and am/ are fully aware of the nature of the stores required and my/ our offer is to supply stores strictly in accordance with the requirements.

Yours faithfully

(Signature of Tenderer)Address__________________Dated____________________Signature of witness________Address__________________

Here paste coupon in case where coupons are supplied to contractors on payment.

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Annexure-12

Form No: D.G.O.F./MM-3Special Instructions to the Tender

IMPORTANT

(A) Please furnish the following information. It may be noted that tenders not furnishing following information are liable to be ignored.

1. (a) Are you Registered for the enquired stores with D.G.S&D/ GM (Ord.Fy)(b) If so, give the number and date of registration and items for which registered.

2. (a) Are you registered with NSIC/Director of Industries as SSI unit?(b) If so, give the number and date of registration and items for which registered.

3. (a) What is your Permanent Income Tax Account Number (PAN)?

(B) The Contract to be finalized against the tender enquiry is also governed by the following special instructions:-

1. (a) The purchaser reserves the right to place order on the successful tenderers for an additional quantity up to 25% of the quantity offered by them at rates quoted.(b) Tenderers are bound to accept order for additional quantity under this clause if order is placed on them during the currency of the contract.(c) If different rates for specific items of stores or slab rates are quoted, the tenderer shall supply the additional quantity in respect of each specific item and each slab at the respective rates quoted by him for these items and these slabs.

2. All disputes and differences arising out of the agreement/ contract to be concluded as a result of this tender enquiry will be referred to the sole Arbitration of Director General of Ord. fys. Or of a Government servant to be appointed by D.G.O.F. The award of the sole Arbitrator as appointed shall be binding on both the parties.

3. The purchaser may, at his discretion, require the prospective contractor to submit an acceptable advance sample for the approval Authority holding the sealed particulars/ Inspection Authority wherever the contract stipulates submission of an advance sample will have to be submitted within 21 days of the receipt of the contract. In case the sample is not submitted within the said time or in the event the opinion of the Inspector is un-acceptable (which must be communicated within_________) the contract is liable to be cancelled at the risk and cost of the contractor.

(C) Special instructions for Imported stores 1. Price offered for imported stores should be submitted on the basis of F.O.B./F.A.S.

Port of shipping of your Principal/ Manufacturer /C.I.F. of Indian Port, F.O.R. station of dispatch in India. The purchaser reserves the right to place order on any such basis. In case of F.O.B./F.A.S. offers, the prices to be quoted should be of your principal/ Manufacturers (exclusive of port rates and other charges in case of shipment from London (port) inclusive of profit, ocean freight etc.)

In case of imported stores, the tenders should indicate in their tender to net F.O.B. and. freight and insurance separately. Nett C.I.F. value should also be indicated invariably.

Prices quoted should be firm and fixed and not subject to

variation on any account.

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2. Terms of Delivery and Payment (a) The delivery of goods will be based on FOB/ FAS /CIP/ CIF basis and cosigned

to Port/ Airport with the ultimate consignee as mentioned in NIT.

(b) All payment to overseas contractors shall be made against irrevocable Letter of Credit to be opened on a scheduled Bank. All Bank charges within India for opening of LC shall be borne by the purchaser. Bank charges payable outside India shall be borne by the supplier.

(c) No advance payment shall be made to supplier on any count.

(d) Payment by Direct Bank Transfer (DBT) shall be mandatory for all payments below USD 50,000. Direct Bank Transfer shall be made within 30 days of receipt of clear payment documents as per contract.

3. Shipping arrangement in case of Imported Stores.

(a) The following provision shall apply in respect of contract concluded in F.O.R./F.A.S. basis and C.I.F./F.O.R. basis respectively. The Stores shall be delivered on F.O.R/F.A.S. basis. The ship to be nominated by the purchaser or his duly authorized representative. In case of shipment coming from U.K.North continents of Europe, borders/members Range ports and Italian ports M/s Schemkr & Co. Humburg, who are the forwarding agents of the Government of India should be contacted for shipping instructions.(b) The contractors should arrange shipment of stores by vessels belonging to the Members lines of the Indian Pakistan conference for cargoes from the U.K.North continents of Europe and continental sea port of the Mediterran sea i.e. French and Italian ports, India Pakistan, Burma, Ceylon outwards freight conference for charges from U.S. and Golf of port. Ellam & Vsnal Steam Ship Co. and the Schocin Steam Navigation C.Ltd. for cargoes from Lawrence East Canadian port.

If the contractor finds that space on the conference vessels is not available in any specified shipment he should inform the secretary shipping Co-ordination committee, Min. of Transport New Delhi. Tele Transport New Delhi immediately so that conference dispensation to the case of alternative lifting may be sought.

The contractor should also furnish to the Secretary, Shipping Co-ordination Committee full details of the cargoes on the prescribed proforma in triplicate sufficiently in advance of the expected date of shipment. The name of the Ultimate Govt. Consignee should also be indicated on the bills of loading in order to identify the cargoes for the purpose of claiming the freight rebate, which the conference have agree to give. Two non-negotiable copies of bills of loading should also be forwarded to the secretary shipping Co-ordination committee, Ministry of Transport New Delhi, immediately after shipment of the aforesaid stores, the above conditions will apply to shipment etc. rating from U.K>North continents port of Europe Border, Humburg Range. Port of the continental Sea port of the Mediterranean i.e. French and Italy ports U.S.A. and Gulf port of the St. Lawrence and Eastern Canadians port. In respect of shipment from other countries the contractor should utilize as far as possible Indian vessels for carrying the goods in consultation with secretary, shipping Co-ordination committee, Ministry of Transport, New Delhi.

            4. Liquidated Damage

(a) As per General condition of contract (Form No. DGS&D-68 Revised) which will govern contracts placed as a result of this invitation to tender provides

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for recovery of liquidated damages on the cost of delayed supplies at the rate of 0.5 per cent per week or part thereof for delayed supplies.  Liquidated damages for delay in supplies thus accrued will be recovered by the overseas paying authority specified in the contract from the Bills payment of the cost of stores submitted by the Contractor or his foreign Principals in accordance with the terms of the contract.

             (b)        The provision for liquidated damages as envisaged in the General Conditions of Contract (DGS&D-68 Revised) will not be applicable in respect of FOB/FAS contracts for supply of imported stores in the event the FOB/FAS cost in foreign currency is equivalent or less than Rs. 5 lakhs.

 5. Submission of tender samples 

            The tenderers in their own interest are requested to send their offers by Registered Air Mail Post instead of by Air parcel to avoid delay in clearance and in receipt of tenders by the Government purchaser.  While forwarding the tender documents by Air Mail Post, they should clearly indicate on the packet that the same contains only tender documents.

 Tenders samples, if any, should be forwarded separately also by

Registered.  Air Mail Post, enclosing a clear declaration to the effect that the same is only a free tender sample against the tender enquiry No……………. dated…………floated by---------- (GM, Tender issuing Factory) and also enclosing a copy of the uncharged invoice.  The original copy of the uncharged invoice should be enclosed with covering letter addressed to------------ (GM of Tender Issuing Factory) intimating particulars regarding the date when the parcel has been sent and this should be forwarded to -----------(GM, Tender issuing Factory) separately by Air Mail.

 The Purchaser will not be responsible for any delay caused by the

despatch of the tenders by Air Parcel through the Airlines as the clearance of such packets from the Customs involves unavoidable cumbersome procedure

6.  Insurance  If a contract is placed as a result of this invitation to tender, and if

Indentor requires insurance of stores tenderers are required to effect insurance of stores only through the Life Insurance Corporation of India and payment should be made in rupee only.  The Tenderer should indicate in their tender F.O.B. cost, freight and insurance separately in addition to the C.I.F value.

7. Inspection

Under normal circumstances, the stores ordered will be accepted on the guaranty warranty of the supplier. In such instances where the contracts specify actual inspection, the Purchaser will arrange the inspection.(a) The stores shall be inspected in accordance with the provisions of the contract.

(b) Where inspection by the inspector is specified, the seller will give him sufficient advance notice of the date in writing on which the goods will be ready for inspection. The seller will also provide the inspector all the necessary facilities including appliances, tools, material and labour at no extra cost, to carry out the specified inspection. When independent tests and analysis, in addition to those made by the inspector on the seller’s or sub-seller’s premises, are considered

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necessary, the seller shall provide and deliver, free of charge, at such place as the purchaser may direct such materials as he may require for tests or analysis.

(c) If any of the articles, whether completed or in the course of production, are rejected by the inspector, they shall be marked or segregated in such manner satisfactory to the inspector as to ensure their subsequent rejection as rejected work.

(d) The purchaser shall not be responsible for payment for any rejected supplies or any costs of inspection thereof.

(e) The seller shall at his own expenses and within the time of delivery for delivery specified in the contract, replace or make good to the satisfaction of the inspector any articles rejected on inspection.

(f) The decision of the Inspector regarding mode, method, rejection or approval will be final.

(g) In addition to the provisions mentioned above. The seller shall also get the stores inspected by its Quality Assurance Department and furnish a certificate that stores conform to the specifications laid down in the contract.

(h) The Purchaser reserves the right to inspect the stores on arrival in India and discrepancy or defects found shall be reported to the seller within 15 months, who shall rectify the same within 90 days.

8. Arbitration 1. All disputes or difference arising out of or in connection with the present contract, including the ones connected with the validity if the present Contract or any part there of shall be settled by bilateral discussions. 2. Any dispute, disagreement of question arising out of or relating to this Contract or relating to construction or performance (except as to any matter the decision or determination whereof is provided for by these conditions), which cannot be settled amicable, shall within sixty (60) days or such longer period as may be mutually agreed upon, from the date on which either party informs the other in writing by a notice that such dispute, disagreement or question exists, will be referred to the Arbitration Tribunal consisting of three arbitrators.3. Within sixty (60) days of the receipt of the said Notice, CONTRACTOR shall nominate one arbitrator in writing and CUSTOMER shall nominate one arbitrator.4. The third arbitrator, who shall not be a citizen or domicile or of the country either of the parties or of any other country unacceptable to any of the parties shall be nominated of the parties within (90) days of the receipt of the notice mentioned above. Failing which the third arbitrator may be nominated by the President of International Chamber of Commerce, Paris, at request of either party but the said nomination would after consultation with both the parties and shall preclude any clause shall not act as an umpire.5. The ARBITRATION Tribunal shall have its seat in New Delhi or such other place in India as may be mutually agreed to between the parties.6. The Arbitrator proceeding shall be conducted in India under the Indian Arbitration and Conciliation Act. 1996 and the award of such Arbitration Tribunal Shall be enforceable in Indian Courts only.7. The decision of the majority of the arbitrator shall be final and binding on the parties to this contract.8. Each party shall bear its own cost of preparing and presenting its case. The cost of arbitration including the fees and expenses of the third arbitrator shall be equally by the Seller and Buyer.

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9. In the event of vacancy caused in the office of the arbitrators, the party, which nominated such arbitrators, shall be entitled to nominate another in his place and the arbitration proceedings shall continue from the stage they were left by the retiring arbitrator.10. In the event of one of the parties failing to nominate its arbitrator with in 60 days as above if any of the parties does not nominate another arbitrator with in 60 days in the place of the arbitrator falling vacant, then the other party shall be entitled after due notice of a t least 30 days to request the resident of the international chamber of commerce to nominate another arbitrator as above. 11. If the place of the third arbitrator falls vacant his substitute shall be nominated according to the provisions herein above stipulated.12. The parties shall continue to perform their respective obligations under this contract during the pendency of the arbitration proceedings except in so far as such obligations are the subject matter of the said arbitration proceedings.

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Annexure-13 Form No: D.G.O.F./MM-4

COMPLIANCE STATEMENT

Clause no.

Commercial and General Terms Compliance to TE specification (Y/N)

If not complied, specify deviations

EMD submitted.Details of EMD i.e. Demand Draft/ FDR/ BG no. & date, validity and Banker’s name furnished in quotation.Price mentioned both in words and figure.

Price are quoted showing Basic Price and Taxes/Duties separately.

All inclusive price is quoted separately.

Installation/commissioning/Freight/ Packing charges, if any

Prices quoted in Rupees/ Foreign Exchange.

Prices are firm and fixed.

Delivery & Prices on F.O.R basis.

Whether Price quoted with PV clause.

Whether the offered store is as per specifications mentioned in TE.

Whether samples submitted as per TE requirement.

Inspection at Factory/ At firm’s premises.

Delivery as per Delivery Period mentioned inTE.

Payment Terms of the TE acceptable.

31

Agreed for option clause as mentioned in TE.

Clause no.

Commercial and General Terms Compliance to TE specification (Y/N)

If not complied, specify deviations

Guarantee/warranty clause accepted.

Agreed for Submission of Security Deposit/ Performance Security Deposit.

Liquidated Damages clause accepted.

Arbitration Clause accepted.

Dispute subject to _____________Jurisdiction accepted.

Whether the tender is signed by authorized signatory.

Return of Tender documents with all pages duly signed and stamped.

Whether Force Marjorie clause included in quotation?

Validity of offer-90 days.

Signature of Authorised Person With seal

N.B: (i) Please indicate YES/NO clearly. Also furnish details wherever required. Please note that the offer deviating from Tender Terms and Conditions likely to be ignored.

(ii) The offer must be accompanied by duly filled in compliance statement; otherwise the offer is likely to be ignored.

32

Annexure-14D.G.O.F/MM-5

STANDARD FORMAT OF SUPPLY ORDER

GOVERNMENT OF INDIAMINISTRY OF DEFENCE

DIRECTOR GENERAL, ORDNANCE FACTORIES--------------------------------------------------------------------------------------------------------

SUPPLY ORDER NO ………………………………………….DATED …………….. This is in acceptance of contractor’s tender/ offer No. and date stated below :-1. (a) Name and address of the contractor: (b) Telegraphic address : (c ) Name of the purchaser : The President of India.2. Tender Enquiry No. and date opened on :3. Contractor’s confirmatory quotation No. & date and subsequent letter No. & date:4. Cost debitable to head :5. Condition of contract : As contained in general condition of contract contained in form

No. DGS7d-68 (Revised) (excluding Clause 24) amended up-to-date shall apply to this contract. DGS&D or his subordinate regional offices” may be deleted and read as “DGOF/GM, ordnance Fys.”

6. Security Deposit : In terms of clause 7 of General conditions of contract under which you have tendered, you are required to deposit by …………… a sum of Rs ……….. (Rupees …………………only ) as security deposit for the due performance of the contract. The security deposit may be furnished in any one of the forms provided in clause 7. but Demand Drafts, cheque etc. may be drawn in favour of CDA (Fys), Calcutta. It is a condition of this contract that you shall deposit the security. In case you fail to deposit the required security by the date specified above, and forward the documents in token of having done so, you will have committed breach of contract entitling the purchaser to cancel the contract or enforce recovery of the amount of security deposit prescribed with or without enforcing rights under the contract resulting from breach thereof.7. Indenting Department : Ministry of Defence (Non-commercial)8. Date of Delivery :9. Terms of Delivery : F.O.R/free delivery at …………………..10. Consignee : The General Manager, Ordnance Factory ………………………………………….11. Despatch Instruction : To be dispatched by Goods train/ Passenger train against M.C.Note to be obtained from the Inspecting Officer or theor the consignee as considered advantageous for expeditious dispatch of the stores. Full wagon load should be booked to Ord. Fy. Railway siding.12. Packing & Marking : (a) Defence Specification No……………………….. OR All items shall be suitably packed for transit by rail. (b) A packing note detailing the stores, supply order no. & item no. is to be enclosed each

package, 2nd copy of packing note showing order no. of total packages and contents of

33

each package etc. shall be made available well in advance to the Inspecting Officer and 3rd copy to the consignee viz. General Manager, Ordnance Factory…………

13. Particulars governing supply : (a) Specification : (b) Market name and Brand : (c ) Country of origin : (d) Method of Purchase :14. Advance sample : You are required to submit an acceptable Advance sample representative of bulk supply

to ………………….. by ………………..(21 days ) for test and trial before commencing bulk manufacture. In case you fail to subject the advance sample by the due date or in case the advance sample so submitted is found unacceptable by the Inspecting Authority, whole decision is final, the contract is liable to be cancelled at the risk and cost of the contractor.

15. Inspection. (a) Inspection Authority : (b) Inspecting Officer : (c ) Place at which to be tendered for Inspection : At firm’s premises at…………………16. Payment.

(a) : The ACDA-in-charge, Accounts Officer, Ordnance Factory……………… Bill should be prepared in appropriate bill form no. IAFZ 68 to be obtained from and prefered on the General Manager, ordnance factory and payment will be arranged by the ACDA-in-charge, Accounts Office, Ordnance Factory.

(b) During the year :17. Special Instruction : (a) You must submit your challan in quadruplicate to the consignee sufficiently in advance of the actual arrival of the stores at destination failing which you will be held responsible for any subsequent discrepancy between actual receipt and the material detailed in the challan received later. (b) Your challan must also contain the following information:- (i) Brief description of stores :

(ii) Supply Order No. & date : (iii)Inspection Note No. & date :

(iv) Railway receipt No. & date : (c ) Please quote on all letters and invoices supply order number and the date. (d) System of Payment. 95% payment after inspection and on proof of dispatch and balance 5% on receipt of

receipt note duly cleared by the Inspector. (e) In case of local deliveries the consignee will issue a ‘Provisional certificate’ to the

supplier as proof of delivery for claiming 95% payment along with inspection note. The form of provisional certificate will be as under.

“ This is a ‘Provisional receipt’. It can only be taken as the token of ‘the receipt of stores by the consignee and is without prejudice to this rights of Inspections and rejection under the General condition of contract. It is issued on ‘said to contain basis’ the contractor remains responsible for proving the total quantities actually delivered.”

(f) (i) The prices indicated in clause 18 are inclusive/ exclusive of sales tax. (ii) The present rate of ………………sales tax is ……….% (iii) In case of Inter state sales, concessional rate of…… % will be applicable with

form D which may be obtained from the consignee. (iv) While claiming sales tax, please furnish the following certificates. “Certified that the goods on which sales tax has been charged have not been

exempted under the Sales Tax Act or the Rules made thereunder and the charge on account of sales tax on these goods are correct under the provision of that act or the rules made thereunder.

34

Certified further we (or our Branch ) or Agent are registered as dealers in the state ………………. (address) under Registration no………. for the purpose of sales tax.”

(g) Payment in all cases will be made to the contractor by the accounts officer named in this supply order by means of crossed cheques only. The receipt of the cheque must be acknowledged within a fortnight. Failure or delay in doing so will render the contractor liable to forefeit the priviledge of having the cheques sent by post.

(h) The stores should be on no account be dispatched/delivered without getting the same inspected and passed by the Inspecting Officer stipulated in the contracts. The contractor along with packing note of stores to the consignee immediately after dispatch of stores by rail.

(i) The purchaser will not separately for transit insurance and the supplier will not be responsible until the entire stores contracted for, arrive in good condition at destination. In case the contractor chooses to insure the goods, he should notify the consignee in writing while forwarding the dispatch documents (such as inspection notes etc.) about the time limit within which the claims for shortages in transit should be raised by the consignee.

(j) The certificate of testing and guarantee of quality be also forwarded along with the material.

(k) ARBITRATION All the disputes and differences arising out of or in any way touching or concerning this agreement (except those for which specific provision has been made herein) shall be referred to the sole Arbitration of the Director General, Ordnance Factories, Government of India for the time being and if he is unable to or unwilling to act as the sole arbiyrator to some other person appointed by the said Director General willing to act as such. Arbitrator so appointed is a Government servant; who had not dealt with matter to which this agreement relates and that in the course of his duties as such Govt. Servant he had not expressed views on all or any of the matters in dispute or difference. The Arbitrator may, from time to time, with the consent of the parties enlarge the time for making and publishing the award. Save as aforesaid, the award of the Arbitrator so appointed shall be final and binding on the parties hereto the provisions of the Indian Arbitration Act 1945 or any statutory modification thereof for the time being in force shall apply. The venue of Arbitration shall be place in which the Agreement is entered into or such other place as the Govt. at its discretion may determine.

18. Description of Goods ordered.

Sl No. Description of Stores Unit Quantity Rate/Unit Total Cost(1) (2) (3) (4) (5) (6)

Grand total cost in words-Rupees……………………………………………

19. The S.O. should be acknowledged immediately on receipt in the aknowledgement form enclosed (DGOF/MM- ).

Name : Designation:

For and on behalf of the President of India.Copy to:-

1. The Inspecting Officer.2. The Controller of Defence Accounts /Fys, 10-A, S.K.Bose Road, Kolkata-13. The Inspecting Authority.

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4. The DCDA-in-charge, Accounts office Ordnance Factory (I copy ink signed)5. The General Manager,

Ordnance factory.Annexure-15

ACKNOWLEDGEMENT OF A/T

(This slip should be completed, signed and returned to the office from which the Acceptance of Tender is received, immediately on its receipt)

Ref. Tender No…………………… for supply of……………………………….

………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

Received Acceptance of Tender No. in respect of the above

Tender, dated the day of 200….

Station

Date of receipt

Signature of Contractor

36

Annexure-16D.G.O.F/MM-16

INSTRUCTIONS TO TENDERER

Return of paper particulars-Copies of particulars supplied to the trade firms in connection with the tender enquiry/contract remain the property of the Government of India and shall be returned to the indenting factory/inspecting officer immediately after submission of quotation or on completion/cancellation of contract/order. No claim for refund of money paid for those particulars will be entertained.

Pre-inspection - Supplier must satisfy themselves that the stores are in accordance with the terms and conditions and fully conform to the required specifications by carrying out a thorough pre-inspection of each lot before actually tendering the same for inspection of the Inspecting Officer nominated under the terms of the contract. The contractor/manufacturer must keep a record of the pre-inspection carried out of which must be submitted to the Inspecting Officer.

If the Inspecting Officer finds that the pre-inspection of the consignment as required above has not been carried out the consignment is liable to be rejected.

Warranty- The stores supplied against the Order resultant to this enquiry shall be deemed to have been warranted against defective workmanship and material by the contractor for a period of 12 months from the date of receipt of stores at consignee’s end and if during this period any of the stores is found so defective the same shall be replaced by the contractor free of any charge at the consignee depot as soon as possible.

Advance Sample – Successful tenderers are required to submit Nos. of unpainted acceptable advance sample of the stores manufactured out of the approved material to the Inspecting Officer within 21 days of the receipt of the Contract for approval before commencing bulk manufacture in case advance sample is not submitted within the specified time of the sample so submitted is found unacceptable the contract is liable to be cancelled at the risk and cost of the contractor.

Packing- The stores should be securely packed to avoid loss or damage DURING TRANSIT SO THAT IT REACHES THE CONSIGNEE IN GOOD CONDITION. The packing and forwarding charges should be borne by the manufacturer/contractor.

Rectification of defects- In the event of store is given back to the manufacturer for rectification of defects, the manufacturer will ensure that the defects are attended to immediately without loss of time so that store can be reinspected. However, it should be noted that the manufacturer will not be entitled to dispose of the store which is given for rectification but not rejected without permission of the Inspector.

I.T.C.C. – Any tender not accompanied with the latest Income-Tax clearance Certificate and permanent Income-Tax Number will not be considered. This has since been amended as only PAN will be sufficient.

You are advised in your own interest to submit stores for inspection at least two weeks before the expiry of the delivery period stipulated in order to ensure inspection and release of inspection note in time, to enable you to deliver the stores by the due date. Your failure

37

to submit the stores for inspection by the period recommended will not by itself be a ground for refusal to receive the stores by the inspector for inspection, if tender before the expiry of the stipulated delivery period but any delay in delivery of stores, on account of such failure, on your part, tendered by the period recommended any delay in inspection or release of inspection notes, resulting in delay in indelivery beyond the stipulated delivery period, would ordinarily be condoned, provided such delay on the part of the inspector is established as the sole and direct cause of your failure to delivery the by the due date.

The quotation should be submitted in duplicate.

Any deviation in stores from tender specification should be clearly highlighted.

Tender should be submitted in one enclosed envelope which should be used as inner cover.

** I/We accept the above conditions in full.

(Signature of tenderer with date )

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Annexure-17 D.G.O.F/MM-27

SPECIAL INSTRUCTIONS

Clause 16 of the supply order.No…………………..S.O………………………….dt………………a) The contractor must submit the challan in quadruplicate to the consignee sufficiently in

advance of the actual arrival of the stores at destination failing which the contractor shall be held responsible for any subsequent discrepancy between actual receipt and the material detailed in the challan received later.

The challan must contain the following information :- a) Supply order Number and Date (ii) Brief description of Stores (iii) Inspection Note

Number and date (iv) Railway receipt number and date.b) Supply order number and Date should be invariably quoted on all corresponding

invoices etc.c) Terms of Payment- 95% will be made after inspection and on production of proof of

dispatch. Balance 5% payment will be made on the receipt of stores by the consignee in good condition at the site and its final acceptance thereof.

In case of local deliveries the consignee will issue a ‘Provisional Certificate’ to the supplier as proof of delivery for claiming 95% payment. The form of provisional certificate will be as under :- This is a ‘Provisional Receipt’ and it can only be taken as the token of the receipt of stores by the consignee and is without prejudice of contract. It is issued on “said to contain basis”. The contractor remains responsible for providing the total quantities actually delivered.

d) Payment in all cases will be made to the contractor by the Accounts Officer named in this supply order by means of Crossed Cheques only. The receipt of the Cheque must be acknowledged within a fortnight. Failure or delay in doing so will render the contractor liable to forefeit the privilege of receiving the cheque sent by post.

e) The stores should on no account be dispatched/ delivered without getting the same inspected and accepted by the Inspecting Officer named in the supply order. The contractor will send the dispatch documents like railway Receipt etc. alongwith the packing note, challan, warranty certificate to the consignee by the Registered Post Acknowledgement due immediately after the desp[atch of stores. Any demurrage/ wafage etc. accrued due to delay in receipt of dispatch document by the consignee shall be on contractor’s account.

f) The Purchaser will not pay separately for transit insurance. The contractor will be responsible untilthe stores, contracted for arrive in good condition. In case contractor choose to insure the goods he should notify to the consignee in writing while forwarding the dispatch document about the time limit within which the claims for shortages in transit should be raised by the consinee.

g) Pre-Inspection- Supplier must satisfy himself that the stores are in accordance with the terms of the supply order and fully conform to the required specification by carrying out thorough pre-inspection of each lot before the inspecting officer.

The supplier must keep a record of pre-inspection carried out and must submit to the Inspecting Officer. If the Inspecting Officer finds that pre-inspection of the consignment as required above has not been carried out, the consignment is liable for rejection.

39

h) Rectification of Defects In the event of a store given back to the supplier for rectification of defects, the supplier will ensure that the defects are attended to promptly so that stores can be re-inspected. However, it should be noted that the supplier shall not be entitled to dispose of the store which is given for rectification but not rejected without prior permission of the Inspector.

i) Warranty The stores supplied against this supply order shall be deemed to have been warranted against defective workmanship and material by the Contractor for a period of 12 months from the date of receipt of the stores at the consignee’s end. If, during this period any of the stores is found so defective the same shall be replaced by the contractor free of charge at the consignee’s end immediately.

j) Return of Paper Particulars. Copies of particulars supplied to the contractor in connection with this supply order remains the property of the Government of India and shall be returned to the indenting factory, inspecting officer immediately after completion/cancellation of supply order. No claim for the refund of money paid on these particulars will be entertained.

k) Arbitration In the event of any questions, disputes, or difference arising under conditions of contract or in connection with this supply order (except to the matters for which specific, provisions has been made ), the same shall be referred to the sole arbitrator of Director General Ordnance Factories or any other officer appointed to be an arbitrator by the Director General, Ordnance Factories. It will be no objection that the arbitrator is a overnment servant that he had to deal with the matters to which the supply order related or that in the course of his duties as a government servant he had expressed views on all or any of the matters in dispute or difference. Award of the Arbitrator so appointed shall be final and binding on the parties to this contract here to the provision of Indian Arbitration Act 1996 and the rules there under and any statutory modification thereof for the time being in force. The venue of arbitration shall be the place in which the agreement is entered such other place as the overnment at its discretion may determine.

1) In case excise duty is payable extra is a separate element in terms of supply order same may be claimed extra. While claiming the excise duty, the supplier shall furnish the following documentary evidence :-

(i) a copy of Gate Pass, which besides showing the rate and amount of excise duty on each consignment should also indicate the number and date of supply order.

(ii) A certificate from the firm’s proprietor/Partner/Director/ Manager/ Accountant on the bill itself to the effect that a0 Amount of excise duty claimed has actually been paid by them to the excise authorities. B) The particulars shown in the Gate Pass have been incorporated in monthly return in Form RT 12 submitted/ to be submitted to the excise authorities and c) should the firm be granted any refund of excise duty claimed in respect of the relevant supplies the benefit of refund would be passed over to the overnment.

m) Whenever claiming sales-tax as separate element as per terms of supply order, supplier must furnish the following certificate:-

“ Certified that the goods in which Sales-Tax has been charged have not been exempted under the sales-tax act or the rules made thereunder and the charge on account of sales-tax on these goods are correct under the provision of that act or the rules made thereunder. Certified that we (on our branch) or agent are registered as declare in the state ……………….. (address) under Registration No……….for the purpose of sales-Tax.”

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n) You are advised to your own interest to submit stores for inspection at least two weeks before the expiry of the delivery period stipulated in order to ensure inspection and release of inspection note in time, to enable you to deliver the stores by the due date. Your failure to submit the stores for inspection by the period recommended will not by itself been ground for refusal to receive the stores by the inspector for inspection, if tendered before the expiry of the stipulated delivery period but any delay in delivery of stores, on account of such failure, on your part, will be rntirely your responsibility. Further, if the stores are tendered by the period recommended, any delay in inspection or release of inspection notes, resulting in delay in delivery beyond the stipulated delivery period, would ordinarily be condoned, provided such delay on the part of the inspectorv is established as the sole and direct cause of your failure to deliver the stores by the due date.

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Annexure-18D.G.O.F/MM-15

TENDER ENQUIRY ADVERTISEMENT

No.Government of India,Ministry of Defence,

Ordnance Factory Board,10 A, S.K.Bose Road,

Kolkata-700001The Director Audio & Visual Publicity,Ministry of Information & Board casting,3rd Floor, PTI Bldg. Parliament Street,New Delhi-110011.Sir, A draft advertisement calling for separate sealed tenders for the supply of the item required by Ordnance Factory is enclosed. The tender is planned for opening between and ……………… The advertisement should be displayed prominently to give wide publicity for these very high valued demands.

2. The advertisement should appear preferably in the following newspaper, if possible.Sl.No. Newpaper Language Place of Publication1. Hindustan Times English New Delhi2. New Bharat Times Hindi ,,3. National Herald English Lucknow4. Times of India English Mumbai5. Maharastra Times Hindi ,,6. The Hindu English Chennai 7. The Statesman English Kolkata 8. The Ananda Bazar Patrika Bengali Kolkata9. The Economics times English New delhi/Mumbai/Kolkata10. Indian Trade Journal English Kolkata3. You are requested to finalise and release the advertisement in the media mentioned in para 2 above under intimation to this office.4. The expenditure of the advertisement is debitable to main Head 5A(a) 2.

Yours faithfully,

For Director General, Ordnance Factories.Enclo: 15 copies of the Draft Notices.

1. The Director General of Commercial Intelligence & Statistics. 1, council House Street, Calcutta-700001. By Regd post.copies of Tender Notice are enclosed. These may be

included in the next issue of Indian Trade journal2 M/s Business Fields, 19, R.N.mukherjee Road, Calcutta-700001.3. The International Press Cutting Service, Post Box No. 63, Allahabad-211001.4. Industries Form.* Swastika Building. * 2 copies of Tender Notice are enclosed. These may be published in your media.

Please note that the expenditure will not be borne by this office for the publication under any circumstances.

5. The Controller of Defence Accounts (fys),

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Calcutta.6. A/E-2 (Cash),7. The General Managers.

Annexure-19D.G.O.F/MM-18

ATTENDENCE REPORT FOR TENDER OPENING

TENDER NO ………………………………………… OPENED ON ……………..AT …………….

SL.NO. NAME OF THE FIRM REPRESENTED BY SIGNATURE OF THE

REPRESENTATIVE

Signatures: 1 …………………………………… 2…………………………………. Tender Opening Officer-I Tender Opening Officer-II

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Annexure-20D.G.O.F/MM-19

SPOT COMPARATIVE STATEMENT

TENDER NO ………………………………. DATED…………………………

SL.NO NAME OF THE FIRM PRICE TERMS OF DELIVERY

DELIVERY REMARKS

SIGNATURES: 1 ………………………………….. 2 …………………………………

TENDER OPENING OFFICER-I TENDER OPENING OFFICER-II

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Annexure-21D.G.O.F/MM-22

DATA SHEET

COVERAGEFactory From To Quantity Stock as on Dues Deficiency

Monthly Requirement: Factory: M.R. End Use Store(Total of all factories) Estimate

End Use Programme: 2000-01 2001-02 2002-03 2003-04

PAST SUPPLIERS DURING LAST THREE YEARS WITH OUTSTANDING DUES POSITION

Sl.No.

Name ofsupplier

S.O.no.&date

qty rate D.P. Quantity supplied Average rate of supply

Qty o/s

Delivery o/s

remarks

Within d.p

Ist extn

2nd extn

3rd extn

From: Factory PLAN OF SUPPLY FROM SISTER FACTORY

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Annexure-22No.14/4/LP/POLICY/MM/P&C

Government of India, Ministry of Defence,

Ordnance Factory Board, 10-A, S.K.Bose Road,

Kolkata-700001. Dated 19.4.2005.

To, The Sr.General Manager/General Manager All Ordnance Factories.

Subject: Measure for reducing advertisement cost for publishing NIT in newspapers through DAVP.

Ref: OFB letter No. 14/4/LP/POLICY/MM (P&C) dated 8.2.2005.

Vide above referred letter all Ordnance Factories were directed to publish Tender Notification in the newspapers in concise form and detailed Notification in the Government website www.govtenders.nic.in. It has, however, been observed that the instructions are not being followed strictly by the factories.

In the recent past it has been pointed out by Secretary (Defence Production) that in certain source development advertisement by some factory, registration of firms with DGQA has been insisted upon and in another case of civil works some factory have issued two tenders even though the value of contracts were such that they could have been combined to reduce advertisement cost.

In this connection it is once again enjoined upon all concerned that the instructions issued vide above referred letter for reducing advertisement cost be followed without exception and also take the following actions:

1. Issue Newspaper advertisement in concise form and for detailed Tender interested parties may be directed to visit website www.govtenders.nic.in. A standardized sample newspaper advertisement is enclosed as Annexure-A to this letter.

2. Upload detailed Tender Notice at the website www.govtenders.nic.in along with ‘Additional Terms and Conditions’ which are specific to the tender. A sample of ‘Additional Terms and Conditions’ is enclosed at Annexure-‘B’.

3. Registration of firms should not be made a precondition in source development cases.

In this connection it may be informed that General Condition of Contract and Tender Form in downloadable form shall be made available at our website www.ofbindia.com with effect from 20.4.2005. The factories are therefore requested to view these General Conditions of Contract and frame their ‘Additional Terms and Conditions’ that are specific to each Tender Notice being published. The General Managers of the factories are requested to take immediate action as mentioned above. In case of any clarification the nodal officer of the factory may be directed to contact the undersigned.

(S.Kolay) DDG/MM (K) For D.G.O.F.

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Annexure-‘A’

Sample Newspaper Advertisement for Open TenderGOVERNMENT OF INDIAMINISTRY OF DEFENCE

Sealed Tenders in prescribed tender forms are invited on behalf of the President of India to tender for the item(s), indicated below:-

Office of Issue (Address for communication) Tel No----------------- Fax No------Tender No. :Cost of Tender set (in Rs)Time & last date for receipt of tendersTime and date and Place of Opening of TenderAmount to be deposited as E.M.D.(to be paid along with the tender)Whether the item/s are reserved for SSI-------- Yes/No

Item No. Description / Specification

Quantity Destination of Stores

Delivery by (Date)

Terms of Delivery

(1) (2) (3) (4) (5) (6)

Intending tenderers may obtain further detail from website www.govtenders.nic.in and tender documents complete with Schedule from Office of General Manager (of the Tender Issuing Factory)………. Or download it from web site www.ofbindia.com.

Please Note:-1) Quotation/Offer shall remain valid for 120 days/ 4 months;2) Quoted Price should be in words and figure. Any discrepancy between words and figures,

the price in words shall prevail. 3) Tender documents are not transferable;4) Tenders submitted in the prescribed tender forms affixing the tender fee / coupon will

only be considered;5) EMD to be furnished by all firms except those registered with DGS&D/NSIC. Other

registration will not qualify for EMD waiver. Offers without EMD will be ignored. Proof of DGS&D or NSIC registration to be submitted with offer;

6) For tenders above Rs.5 crores PSU Purchase Preference Clause will apply;7) Purchaser reserves the right to reject or accept any tender, fully or partially, or application

without assigning any reasons whatsoever.8) If Tender Forms are downloaded from the website, EMD and the cost of Tender set to be

paid by separate bank draft at the time of submitting tenders otherwise tender shall be ignored.

9) Drafts will be payable to General Manager of tender issuing factory to be drawn on a scheduled bank and payable at……………..

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Annexure-23D.G.O.F/MM-31

FORMAT FOR EXTENSION OF DELIVERY PERIOD No.

Government of India,Ministry of Defence,

Ordnance Factory Board,10 A, S.K.Bose Road,

Kolkata-700001To

Sub: Ref:

Dear Sirs, You have expressed your inability to deliver the stores within the contract delivery

period. In your letter under reply, you have asked for extension of time for delivery. In view of the circumstances stated in your said letter, the time for delivery is extended from.

Please note that price preference loss were stipulated in the schedule to the supply order and an amount equal to the liquidated damages for delay in the supply of the stores after the expiry of the contract delivery period shall be recovered from you is specified in clause 14(7)(i) of the general conditions of the contract DGS&D-68 (Revised) for the extended period notwithstanding the grant of this extension. You may now tender the stores for inspection in terms of this letter. Stores if any already tendered by you for inspection but not inspected will now be inspected accordingly.

The above extension of delivery will also be subject to the following further conditions:- (a) That no increase in price on account of any statutory increase in or fresh imposition

of customs duty, excise duty, sales-tax or on account of any other tax or duty leviable in respect of the stores specified in the supply order which takes place after---------shall be admissible on such of the said stores as are delivered after the said date; and

(b) That not withstanding any stipulation in the contract for increase in price on any other ground no such increase which takes place after-----------shall be admissible on such of the said stores as are delivered after the said date;

(c ) but nevertheless, the purchaser shall be entitled to the benefit of any decrease in price on account of reduction in or remission of Custom Duty, Excise Duty, Sales-Tax or on account of any other tax or duty or on any other ground as stipulated in the price variation which takes place after the expiry of the above mentioned date namely---------&---------.

Please intimate immediately acceptance of the expansion of the above conditions. Please note that in the event of your declining to accept the extension on the said condition or your failure after accepting or acting upon this extension delivery the stores/the outstanding quantity of stores within the delivery period as hereby extended, the contract shall be cancelled and the outstanding quantity of the stores shall be purchased at your risk and cost under the terms of the contract.

All other terms and conditions of the contract remain unaltered.Yours faithfully,

For and on behalf of the President of India.Copy to:

1. The Controller of Inspection (Military Explosives) Kirkee, Pune.2. The Sr. Inspector of Armament,3. The Accounts Officer,4. The General Manager,5. The DFA (Fys), Calcutta,6. The CDA (Fys), Calcutta (2 copies ink signed)

48

7. The Controller of Inspection (Metals) Ishapore8. The Controller of Inspection (Ammn.) Kirkee, Pune9. The Director of Inspection (Armaments) DHQ, P.O.New Delhi.

Annexure-24D.G.O.F/MM-32

EXTENSION OF DELIVERY PERIOD

No.Government of India,Ministry of Defence,

Ordnance Factory Board,10 A, S.K.Bose Road,

Kolkata-700001To M/s.

Sub: Supply of Against supply order of even no dated…………… Ref: Your letter No………………dated……………….Sirs, Your attention is invited to the supply order cited above, according to which supplies ought to have been completed by you on or before………. Inspite of the fact that the time for delivery of the stores stipulated in the supply order is always the essence of the contract, it appears that the supplies are still outstanding even though the delivery period has expired.

2. Although not bound to do so, I hereby extend the delivery date from…………to ………. And you are requested to note that delivery of the outstanding quantity by the said date is the essence of the contract and in the event of your failure to deliver the stores within the delivery period as hereby extended the contract shall be cancelled and the outstanding quantity of the stores shall be purchased at your risk and cost.

3. Please note that price preference loss where stipulated in the schedule to the supply order and an amount equal to the liquidated damage for delay in the supply of the stores after the expiry of the contract delivery period shall be recovered from you specified in clause 14(7)(i) of the general conditions of contract DGS&D-68 (Revised) for the extended period not withstanding the grant of this extension. You may now tender the stores for inspection in terms of this letter. Stores, if any, already tendered by you for inspection but not inspected will now be inspected accordingly. 4. The above extension of delivery will also be subject to the following further conditions:-a) That no increase inprice on account of any statutory increase in or fresh imposition of

customs duty, excise duty, sales tax on or on account of any other tax or duty leviable in respect of the stores specified in the supply order which takes place after …… shall be admissible on such of the said stores are they delivered after the said day, and

b)That notwithstanding any stipulation in the contract for increase in price on any other ground no such increase which takes place after …… shall be admissible on such of the said stores as are delivered after the said date.

c) But, nevertheless, the purchaser shall be entitled to the benwfit of any decrease in price on account of the reduction in or remission of customs duty, excise duty, sales tax or on account of any other ground as stipulated in the price variation clause which takes place after the expiry of the above mentioned date namely…………………

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5. “You are rquested to note that notwithstanding the extension of in delivery period, (if accepted by you) the time hereby extended for supply of stores shall be deemed to be of essence of contract and failure on your part to supply the stores by the extended time shall entitle the purchaser to cancel the contract at your risk and cost without further notice or opportunity”.6. Please intimate your unconditional acceptance to reach this office within 21 days of issue of this letter failing which the contract will be cancelled at your risk and expense without any further reference.7. All other terms and conditions of the contract remain unaltered.

Yours faithfully,

For and on behalf of the President of India.

Copy to : The Inspector of Armaments, Khandahar Lines, Dlhi Cantt. The General Manager, Admin/Ordnance Factory (4 copies). The Accounts Officer, Admin/Ordnance Factory (1 ink signed copy). The CDA (Fys) Calcutta. The Finance Division, Calcutta. The Controller of Inspection ( Ammn.), Kirkee The Controller of Inspection ( Metals), Ishapore The Controller of Inspection (Military Explosives), Kirkee The Director of Inspection (Armaments), DHQ.,P.O.New Delhi-11. The Sr. Inspector of Armaments, L.B.Shastri Marg, Vikroli,Mumbai. The Sr. Inspector of Armaments, Hastings, Calcutta-22. The Sr. Inspector of Armaments.

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Annexure-25DRAFT NOTICE TO BE ISSUED BY THE PURCHASER AFTER 15 DAYS OF ISSUE OF AMENDMENT LETTER REGARDING EXTENSION OF DELIVERY PERIOD WHERE THE SUPPLIER HAS NEITHER ACKNOWLEDGED NOR ACTED UPON THE EXTENSION LETTER

REGISTERED –AD No………………………………….

To, ……………………………………. ……………………………………. ……………………………………. Sub: A/T No………………………………..dated……………….. For supply of…………………………………………………Dear Sirs, This is with reference to your letter no……………dated………….. requesting the grant of extension of delivery period under the above mentioned contract and this office amendment letter no………………..dated………….. You have neither conveyed your acceptance of the extension letter as desired in para 6 of the letter/nor you have cared to effect any supplies without prejudices to the right of the purchaser under the contract and under the law, you are requested to state by ………….. (Here give date by adding 15 days to the date of issue of this notice ) whether the aforesaid amendment letter regarding extension of delivery period is acceptable to you. In the event of your failure to acknowledge acceptance of the extension letter by the above mentioned date, the contract will be cancelled at your risk and cost under the terms of the contract.

Yours faithfully,

(………………..)Dy. Asst. Director of Supplies

For and on behalf of the President of India.

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Annexure-26

EXTENSION OF DP AT REDUCED COSTREGISTERED POST ACKNOWLEDGEMENT DUE

No.Government of India,Ministry of Defence,

Ordnance Factory Board,10 A, S.K.Bose Road,

Kolkata-700001To………………………………..………………………………..……………………………….. Sub: A/T No……………………….dated…………….. For supply of…………………………………….. This is with reference to your Letter No……………….dated………….. requesting the grant of extension of the delivery period under the above mentioned contract.

02. The stipulated delivery period has expired on…… and the goods have still not been supplied by you. You have consequently committed a breach of contract.

03. With a view to considering your request for an extension of the delivery period, and without prejudice to the rights of the purchaser under the contract and under the law, for the contracted stores, you are requested to state by ……. Whether you are willing to accept a price of …… for the contracted store.

(……………………….)For and on behalf of the Purchaser.

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Annexure-27D.G.O.F/MM-30

PERFORMANCE NOTICE FOR NOT SUBMITTING ADVANCE SAMPLE AMENDMENT NO. No.

Government of India,Ministry of Defence,

Ordnance Factory Board,10 A, S.K.Bose Road,

Kolkata-700001ToM/s………………………….……………………………… Sub: Ref:Sirs, Your attention is invited to the Supply Order cited above according to which acceptable advance samples ought to have been submitted by you on or before ………inspite of the fact that the time for submission of acceptable advance samples stipulated in the supply order is all along of the essence of the contract. It appears that the acceptable advance samples are still outstanding even though the date of submission has expired. Although not bound to do so, I hereby extend the date of submission of acceptable advance samples upto ….And you are requested to note that the submission of acceptable advance samples by the said date is of the essence of contract and in the event of your failure to submit the samples within the date as hereby extended the contract shall be cancelled and the stores shall be purchased at your risk and cost. Please communicate your acceptance of the aforesaid extension upto… and your readiness to act upon it within a week of the receipt of this letter failing which it shall be presumed that you are not interested in performance of the contract and the contract will be cancelled at your risk and cost. If having communicated the acceptance of the aforesaid extension, you fail to submit the acceptable advance samples the contract will be cancelled at your risk and cost. All other terms and conditions of contract remain unaltered and shall be applicable.

Yours faithfully,

FOR AND ON BEHALF OF THE PRESIDENT OF INDIA.

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Annexure-28

LETTER FOR COLLECTING ADDITIONAL INFORMATION FROM THE SUPPLIER AFTER BREACH OF CONTRACT

No………………………………………………….

To, M/s…………………………………. ……………………………………… ………………………………………Sub: A/T No…………………………….dated………….for supply Of………………………………………………………………

Dear Sirs, The date of delivery in relation to the subject A/T, expired on …………………. But as supplies against the same have not yet been completed, there is a breach of contract on your part. As information is required regarding past supplies, you are requested to send the particulars regarding the quantity so far supplied/inspected but not yet dispatched/tendered for inspection before the expiry of the date of delivery. The above information is required for the purpose of verification of our records and is not intended to keep the contract alive and does not waive the breach. This is without prejudice in terms of the contract and law applicable to this behalf.

Yours faithfully,

(………………..) Consignee

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Annexure-29(DGOF/MM-33)

SHORT CLOSURE AND CANCELLATION OF SUPPLY ORDERREGISTERED POST ACKNOWLEDGEMENT DUE

No.Government of India,Ministry of Defence,

Ordnance Factory Board,10 A, S.K.Bose Road,

Kolkata-700001 Sub: A/T No…………………………….dated………….for supply of………………………………………………………………

Sirs, Since you havre failed to supply outstanding quantity of…………….of the above store as per subject contract, the contract is hereby cancelled for the balance quantity at your risk and cost in terms of clause 14 of the General terms and conditions of the contract contained in DGS&D-68 (Revised). The amount of recovery involved, if any, as a result of the cancellation will be intimated to you in due course.

This is without prejudice to the rights of purchaser in accordance to the terms and conditions of the contract.

Yours faithfully,

For and on behalf of the President of India.Copy to:

2. The Controller of Inspection (Metals), Ishapore.3. The Controller of Inspection (Military Explosives).4. The Controller of Inspection (Ammn).5. The Director of Inspection (Armament), DHQ P.O.New Delhi-1.

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Annexure-30PROFORMA FOR SANCTION OF AIRLIFT

1. Date of intimation/Demand : by the factory 2. (a)Date of DGTD/TC (VP) : clearance from indigenous angle2 (b) Date of clearance of the demand by LAO:3. DRG/PART NO. DESCRIPTION QTY PROPOSED WEIGHT IN KG FOR AIR LIFT

END USE:

4. Country from which Air lifting : to be done5. No. of the contract/S.O and date :6. (a) Stock on date in the Fy & how : long it will last based on the prod prog/monthly requirement(b) How the quantity to be airlifted : has been arrived at and whether it is the irreducible minimum.7. Brief Justification for Airlift : bringing out clearly if there is any undue delay at any stage so as to eliminate such delays in future.8. Gross Weight :9. Nett Weight :10. Airlift Charge :

(………………………)For General Manager

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Annexure-31D.G.O.F/MM-34

LETTER FOR FINAL PAYMENTTo, ……………………………… ……………………………… ……………………………… Sub: A/T No…………………………….dated………….for supply of………………………………………………………………Sirs, Please furnish the following information to enable this office to finalise the above case for your 5% payment.

(a) Please intimate reasons for delay in supply and furnish details of dispatches.(b) Please confirm that you have received payment in full for all quantities supplied

by you against the above contract, except 5% referred to above.(c) Please certfy that you have no claims in connection with on arising out of the said

contract by any of excise duty, sales-tax or otherwise whatsoever.Your reply should reach this office latest by……….. failing which it will be presumed that you have no claims whatsoever in respect of the above contract and the case will be finalized accordingly.

Yours faithfully

(……………….)For General Manager.

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Annexure-32D.G.O.F/MM-37

CLOSURE OF SUPPLY ORDER No.

Government of India,Ministry of Defence,

Ordnance Factory Board,10 A, S.K.Bose Road,

Kolkata-700001

To, M/s…………………….. …………………………. ………………………….Sub: A/T No…………………………….dated………….for supply of………………………………………………………………Sirs, Please confirm that you have received 100% payment against the subject supply order and you have nothing due what-so-ever so that this office may close the case. Your reply should reach this office latest by…………… failing which it will be presumed that you have no claim what-so-ever in respect of the above contract and the case will be closed accordingly.

Yours faithfully,

(…………………..)For director General Ordnance Factories.

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Annexure-33PROVISION PROCEDURE

No.01/5/SP/C/Part/4847/D(Prod)Government of India,Ministry of Defence,

Department of Defence Production.,New Delhi,the 11th June 73.

To, The Director General, Ordnance Factories, 6, Esplanade East, Calcutta-9. Sub: Provision Procedure.Sir, I am directed to say that in supersession of the orders on the subject contained in this Ministry’s letter No. 12/38/64/D(Prod) dt. 2.9.65 as amended/extended from time to time, the President has been pleased to decide that Provisioning of stores required for use in Ordnance & Equipment Factories should be made on the basis explained below :-WORKING STOCK OF STORES MATERIALS/COMPONENTS/PACKAGES PROCURED THROUGH GENERAL PURCHASE AGENCIES:- 2. Normally, provisioning should be made on the basis of six months’ requirements as assessed with reference to firm demands from the services and other indentors. Indents placed by the services etc. will be treated as a firm demand for the purpose of materials provisioning.

3(a) Indents may be placed 36 months in advance of the period of utilization which will be 12 months for imported items as difficult indigenousitems ( i.e. where it is known from past experience or available information that supply did not materialize or is not likely to materialize in time and hence due to such anticipated long delays, provisioning for longer requirements is essential in the interest of production.) For ordinary indigenous stores may be placed 42 months in advance of the period of utilization which will be 6 months.

(b) Assessment of requirements of the following items may be made with reference to the monthly average consumption of the past 18 months :

TIMBER ITEMS, ITEMS OF SEASONAL NATURE OTHER THAN TIMBER SUCH AS TANNING MATERIALS, STEEL SCRAP.

Provisioning of Tool Steel may also be made on the basis of past average consumption till computarised material provisioning system is introduced in the factories concerned.

N.B. Where requirement assessed on the basis of past consumption is not considered adequate due to high consumption of the items in the recent past or due to commissioning of the new plant etc. requirements may be increased based on the available data and ……….full justification recorded. Similarly, where any reduction is foreseeable for reason such as declining production trends; or the residual life of the plant concerned, the assessed requirements should also be reduced and full justification recorded.

4. Provision for general purpose stores and maintain-stores which are not required directly against production will normally be made on the basis of the monthly average consumption of the proceeding 18 months.

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Exception may be allowed in the case of certain stores which provision is Required to be made on the basis of technical knowledge after taking into account the life of the store required or for the minimum quantity acceptable to the producer.

5. In order to avoid over-provisioning it should , however, be ensured that, subject to the above exceptions, provisioning is not made on the basis of the entire demand of the Services but on the basis of which the DGOF/GMs realistically expects to produce out of that demand during a particular provisioning period. The delivery dates shown in the indents should be staggered so that as far as possible, the actual stock at the factory, is restricted to the optimum levels as laid down in para 9 below.

SAFETY BALANCE6. In addition to the provisioning as explained above, the General Managers at their discretion may provide for a safety balance of 4 months in respect of imported items and one month in respect of difficult indigenous items in cases where the available service demands do not cover the entire provisioning period, but there is an indication that further Service demands for the end-products are likely to follow and the demand for the end-product is of a recurring nature. Safety balances would not be provided in any other case. These safety balances will be operative only for determining the stock levels as mentioned in paragraphs 10 and 11 and not for additional provisioning.

7. PROVISION AGAINST AD-HOC REQUIREMENT The procedure prescribed above will also be adopted for provisioning for ad-hoc

demands, and supplementary indents if necessary, will be placed to procure the stores.

PROVISIONING BY LOCAL PURCHASE8. If the cost of the requirements of an items calculated on the basis indicated in the preceding paragraphs does not exceed Rs. 50,000/- ( Rupees fifty thousand only), these requirements may be met by direct purchase. While placing supply orders, a stipulation should be made for staggering of supplies so as to ensure that approximately not more than 6/12 months requirements would be in stock at any time.

9. STOCK PILES (I) Stock piles of non-perishable imported materials should be built upto 9 months’ requirements and of indigenous materials difficult to obtain upto 4 months requirements except in cases where higher limits have already been specially authorized by the Govt. Maximum monthly production envisaged during 1972-73 to 1974-75 on the basis of 2-10 hours shifts where it could be worked, may be taken as the basis for calculation of the authorized stock holdings.

(II) The DGOF should assure that the stock piles are adequately turned over from time to time.

(III) The stock piles referred to above will be entirely distinct from the current and forward provisioning programme and any other stocks that are referred to above.

(IV) Each item of stock pile should be reviewed every 3 years or as soon as it comes to notice that the indigenous production of the imported items has developed satisfactorily or the supply position of the indigenous items has improved or the production of the relevant end store has been discontinued.9. With reference to paragraphs 3(a), 6 and 9 above, the optimum levels of stocks held by factories at any time in respect of imported stores, difficult indigenous items and ordinary indigenous items may be as follows :- (a) Imported Items

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-25 months’ requirements, including 12 months’ working stock, 4 months’ safety balance wherever authorized at GMs’ discretion and 9 months’ stock pile where authorized. (b) Difficult indigenous items – 17 months’ requirements including 12 months’ working stock, 1 month’s safety balance and 4 months’ stock pile, where authorized. (c ) Ordinary indigenous items – 6 months’ working Stock. The GMs will have complete freedom according to their judgement in maintaining stocks subject to ceiling limits mentioned above and availability of storage space to meet production targets.

10. For the purposes of emergent provisioning, the General Manager should fix critical levels in respect of individual items at their own discretion, keeping in view the production programmes. However, for their guidance, the critical levels which should be treated as ceilings and which should not be exceeded are given below :-

(a) Imported Items - 20 months’ (including 7 months’ workin stock 4 months’ safety balance and 9 months’ stock pile where authorized.

(b) Difficulty indigenous item - 12 months’ (including 7 months working

stock, 1 month’s safety balance and 4 months’ stock pile where authorized).

(c ) Ordinary indigenous items - 6 months

The GMs should take action to resort to direct purchase as far as indigenous items are concerned and take urgent action through the DGOF for imported items, to maintain the stock above critical levels. In respect of ordinary indigenous items which are easily procurable and/or where suppliers will not agree to staggered deliveries, GMs may, at their discretion, take procurement action for lesser quantities than those envisaged vide para 3(a) and 10 above without hampering their production programme. N.B. : The quantum of stock mentioned in paragraphs 9 and 10 above will be determined with reference to current production programme of the factories.

11 It’ will be necessary for the GMs to review their inventories and requirements from time to time and take necessary action for the disposal of surpluses, if any, as per laid down procedure or procurement action for the deficiencies.

12. This issues with the concurrence of the Ministry of Finance(Finance) vide their U.O. No. 678/II/OF dt. 12.3.73 and No. 3411/II/OF dt. 18. 5. 73.

Yours faithfully,

Sd/- ( T.S. NARASIMHAN ) Under Secretary to the Govt. of India

Copy to :- 1. The Controller General of Defence Accounts, New Delhi The Director of Audit, Defence Services, New Delhi The Sr. Dy. Director of Audit. Defence Services, New Delhi The Controller of Defence Accounts(Fys), Calcutta The Asstt. Accounts Officer, Kanpur The D.F.A. (Fys), Calcutta The D.F.A.(Budget) & (Project), New Delhi. The D.F.A. (Ordnance), New Delhi.

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Copy signed in ink to :- The Controller of Defence Accounts (Fys), Calcutta.

Annexure-34 ORDNANCE FACTORY BOARD,

10A S.K. BOSE ROAD,CALCUTTA-700 001L

Sub : Review of Procurement Procedure in Ordnance Factories.Ref : M of D I.D. No.1(3)/95/D(Proj.II) dt. 23.03.1998.

With reference to M of D I.D. quoted above and Chairman/OFB D.O. Letter of even No.dated 1/5.6.98, Provisioning Procedure for O.F. Organisation issued by M of D vide their letter No.12/38/64/D(Prod.) dated 2.09.65 and amended subsequently vide M of D Letter No.01/5/SP/C/Part/4847/D(Prod.) dated 11.06.73 has been reviewed in consultation with Associated Finance, and agreed Draft Provisioning Procedure is enclosed herewith as Annexure 'A', for kind approval and issue as Government Order by Ministry of Defence.

02. Further, with specific reference to Para 3 of the Ministry of Defence Letter quoted under reference above, with a view to have uniformity and greater transparency in procurements while ensuring timely supplies of desired quality to meet the production targets in time, the Purchase Procedure and Tendering System of O.F. Organisation have been thoroughly reviewed and broad guidelines formulated in this connection are enclosed hereith as Annexure 'B' to this letter for kind perusal. It may be mentioned in this connection that the proposed Provisioning Procedure and the Tendering System have been developed keeping in view the basic objectives of this largest departmentally run Defence Production Organisation, warranting timely inputs conforming to straingent quality parameters as per Defence Specifications.

03. In view of the changes as proposed above, including changes already taken place from time to time, amendments in some of the inter-related clauses in the Materials Management Hand Book as mentioned in Chairman/OFB D.O. Letter dated 1/5.6.98 will be necessary once the proposed changes in the Provisioning Procedure (Appendix 'A') and Tendering System (Appendix 'B') are approved by Ministry of Defence.

04. It is requested that Government Sanction for the proposed Provisioning Procedure as listed in Appendix 'A' may kindly be issued at the earliest so as to implement the same along with all other proposed changes in Ordnance Factories.

05. This issues with the approval of Chairman/OFB.

Enclo. : Annexures 'A' & 'B'Sd/-

( D.B. Betigeri )Member/PEDB & MM

For DIRECTOR GENERAL, ORDNANCE FYS.ToThe Joint Secretary (OF),Ministry of Defence,Deptt. of Defence Production & Supplies,NEW DELHI -110 011.

( Kind Attn. : Shri OM Prakash,Jt.Secretary(OF) )

OFB U.O. No.10/6/MM dated 23.04.1999

Copy to :- All members and pps to Chairman/OFB

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ANNEXURE - "A"

SUB : PROVISIONING PROCEDURE.

The Provisioning Procedure to be followed in the Ordnance Factories was prescribed vide Ministry's letter No.01/5/SP/C/Part/4897/P(Ord.) dated 11.06.73 as amended/extended from time to time. This provisioning procedure was envisaged on firm Indents from the services four years in advance. For various reasons the placement of firm Indents on four yearly roll-on basis has now been replaced by firm annual Issue Programme finalized only at the beginning of each financial year.

1.1 The Ordnance Factories are dedicated to meet Defence Services requirements. A minimum lead time to plan, procure and position materials to enable them to meet the firm deliveries to the Services is required. Corresponding lead time is also required to be given to the Suppliers on whom the Ordnance Factories will be placing reliance to meet their requirements of components and various direct materials both imported as well as indigenous. Keeping in view the foregoing lead times in the chair of production to maintain the continuity in production and issues from the Ordnance Factories, I am directed to state that the President is pleased to decide that the Services may be permitted to place Indents on the Ordnance Factories for all items at least two year in advance. All procurement actions will be undertaken by Ordnance Factories based on the firm Indents and subject to the provisions of the Annual Budget.

1.2 The President is also pleased to decide that the provisioning of Stores required for use in the Ordnance Factories should henceforth be made on the basis of the following revised procedure.

2. WORKING STOCK OF STORES:Working Stock of Stores in Ordnance Factories is broadly categorized into two groups

viz., (I) Direct material i.e., Materials/Components/Packages used in the Products manufactured in Ordnance Factories, and (ii) In-direct material i.e., General Purpose Stores & Maintenance Stores.

2.1 Direct Material For the purpose of initiating provisioning action for the items of Service requirements, Indents indicated by the Services at least two years in advance of beginning of the financial year only will normally be considered. For this, the basis should be the annual requirements as assessed with reference to the production targets for the financial year issued by Ordnance Factory Board as settled with the Services and other Indenters.

If firm Indents are not available, provisioning action will be initiated based on the urgent requirements agreed with the Services with the specific indication from the Services Hqrs. That the formal Indent will follow.

2.1.1 Imported Items. For Direct Materials of imported origin, provisioning action will be initiated well in advance of the period of utilization. Provisioning action will be taken for requirement upto a maximum period of 24 months i.e., 12 months in advance of the period of utilization which is 12 months, less stocks and dues.

2.1.2 Indigenous items For Direct Materials indigenously available, provisioning action shall be initiated at least six months in advance of the period of utilization which will be 12 months i.e.,

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provisioning action will be taken for a maximum period of 18 months, less stocks and dues.

2.2 Indirect MaterialProvision of stock of indirect materials i.e., General Purpose Stores & Maintenance Stores which are not required directly in the production will be made on the basis of monthly average consumption during the preceding 24 months.

2.2.1 Imported items

For indirect imported items, provisioning action must be initiated minimum six months in advance of the period of utilisation which will be 12 months i.e. provisioning action will be taken for a maximum period of 18 months less stock and dues.

2.2.2 Indigenous items

For indirect indigenous items procurement action may be taken minimum six months in advance of the period of utilisation which is twelve months i.e. for requirement upto a maximum period of 18 months less stock and dues.

N.B: (a) Exception may be allowed in the case of certain Stores where provision is required to be made on the basis of technical knowledge/uses after taking into account the life of the stores required, or Economic batch quantity with the specific approval of the General Manager.

(b) Where requirement assessed on the basis of past consumption is not considered adequate, due to high consumption of the item in the recent past or due to commissioning of new Plant etc. requirement may be assessed based on the available data and full justification recorded in consultation with the Local Accounts, with the approval of the General Manager. Similarly, where any reduction is freseeable, for reasons such as declining production trends or the residual life of the plant concerned, the assessed requirement will also be reduced and reasons recorded.

3. Supplementary Requirements

The procedure prescribed above will also be adopted for Ad-hoc demands; and supplementary orders, if necessary, will be placed to position the materials.

4. Stockpile 4.1. Stockpiles of non-perishable imported materials shall be built upto 6 months

requirements, and of indigenous materials difficult to obtain upto 3 months requirements. Maximum monthly production envisaged on the basis of two shift normall working, where it could be worked, may be taken as the basis for calculation of the authorised stockpile holdings.

4.2. The Factory will ensure that the stockpiles are adequately turned over from time to time.4.3. The stockpiles referred to above will be entirely distinct from the regular provisioning

programme and any other stocks that are referred to above.4.4. Each item of stockpile shall be reviewed every year or as soon as it comes to notice that

the indigenous production of the imported items has developed satisfactorily or the supply position of the indigenous items has improved or the production of the relevant store has been discontined.

5. Stock Holding

The levels of Store-In-Hand Inventory held by a Factory at any time in respect of imported stores as well as indigenous items, will depend upto the criticality of the items in maintaining the continuity of production, lead time required to procure the item,

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availability of alternate capacity verified and established sources, availability of storage space etc. The optimum level of SIH inventory for any item may be fixed by the General Managers in such a way that the overall assessed inventory holding for the factory should not normally exceed the maximum level as indicated below :-

Group Over-all SIH Inventory Level(Maximum)

AV Group Factories 6 MonthsOEF Group Factories 3 MonthsOther Factories 4 Months

6. General6.1 The factory should take prompt and timely action for both indigenous as well as imported

items, through OFBoard wherever necessary, in such a way that stock out situations are avoided to maintain continuity in production.

6.2 Deliveries against the Supply Orders/IFDs shall be staggered so that as far as possible the actual stock at the factory is restricted within the minimum and maximum levels in consonance with the Production/Issue Plant of the factory. The staggered delivery schedule desired shall be included in the tender notice/IFDs itself.

6.3. Wherever IFD supplies are available, procurement from trade is prohibited without specific approval of the concerned Member.

7. REVIEW :It will be necessary for the factory to review their inventories and requirements regularly through computerised system and take necessary action for the disposal of surpluses, if any, as per laid down disposal procedure or procurement action for the deficiencies.

8. This issues with the concurrence of the Ministry of Finance (Defence) vide their U.O.No.dated…………..

- :: 0 :: -

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ANNEXURE - B

PURCHASE PROCEDURE AND TENDERING SYSTEM IN ORDNANCE FACTORIES (GUIDELINES)

PREAMBLE :

The Purchase Procedure and Tendering System for all Direct Materials used for Defence Production have great bearing on the categories of vendors available. For this purpose, vendors are broadly divided into the following categories :-

1. CATEGORY OF VENDORS

A. DGQA Registered and Established Vendors for a particular item.B. Established Vendors since long but not Registered with DGQA.C. DGQA Registered Vendors but not yet Established.D. Potential Vendors neither Registered with DGQA nor an Established Supplier for a

particular item as yet.

2. DEFINITION OF "ESTABLISHED SOURCE "

A Vendor can be considered as an Established Source for a particular item if they have successfully delivered the quantity against One Supply Order, meeting the desired quality requirements satisfactorily.

( Authority : 77/P&MM/BS dated 13.09.01 )3. VENDOR DEVELOPMENT

3.1. Vendor Development is necessary for the following reasons -

- When number of existing Established Vendors is less than Six for Direct as well as Indirect Materials.

- To implement indigenisation programme.- Change in 'Make' or 'But' decision.- Multiple/Alternate Vendor Development Programme under the following

circumstances -

a. When it is apprehended that the Established Vendors have formed a group and quote to the disadvantage of the Government.

b. When the rates offered by the Established Vendors are considered high and not realistic in terms of the prevailing market condition.

c. When the Delivery/Quality rating of an Established Vendor is found to be below the acceptable qualifying grade in spite of repeated efforts on the part of the purchaser to help the vendor to regain his original grading.

d. When the total capacity of the Established Vendors is not adequate to meet purchase requirement including contingencies that may arise due to failure of any vendor.

3.2. Transparency and Openness to Industry :

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OFB will publish a Booklet giving basic procedural steps involved in procurement for the guidance of everyone interested in participation in OFB Purchase Programme. Every year Open Advertisement will be given for getting more and more Vendors to be registered with DGQA/DGOF to become Category 'C' Vendors against each item of Direct/Indirect Materials. For this purpose, Categories 'D' & 'E' Vendors may also be persuaded/motivated to apply for Registration to become Category 'C' Vendors from Category 'D', and Category 'A' Vendors from Category 'E'. Advertisement will indicate the details of items required, approximate Vendors available.

3.3 Developing New Sources

For developing new sources, OTE is to be floated to the extent of 20% of the Annual Ordering quantity with a proviso that only capacity verified and duly Registered Firms by DGQA for that particular category of items (i.e. Category 'C' Vendors) should only participate. This will enable Category 'C' Vendors to come under Category 'A' list after successful development. In these cases, orders may be placed on more than one Vendor in the interest of developing more sources for wider competition with/without price differential within the financial powers of concerned authority, keeping in view the CVC Guidelines.

3.4 Helping hand to New Entrants :

In Vendor Development Orders, realistic Delivery Schedule may be given. However, if the supplier takes longer time to develop the item, the order on the Firm may be cancelled without Risk Purchase (RP) action after a reasonable period of extension. EMD/Security Deposit of 5% on the value of the Development Order will be obtained which may be forfeited by the relevant TPC, if considered justified in case of failure of the Firm to execute the Development Order within a reasonable time. Proper guidance/help, wherever necessary, should be extended to the Vendors for development.

4. DEFENCE REQUIREMENT 4.1. Procurement of Direct Materials The Purchase Procedure for Direct Materials (Defence Requirement) based on the

categorisation of Vendors, may be followed as given below :-

a. Bulk from Established Sources :Limited Tender Enquiry for about 80% of Annual Ordering Quantity is to be floated among the Category 'A' Vendors. If minimum Six Vendors are not available in Category 'A', Category 'B' Vendors may also be included in the list for issuing Tenders. However, even after including all Category 'B' Vendors, if the number remains below Six, LTE will be issued only to the available 'A' and 'B' Categories Vendors. The list of Vendors to whom LTE is to be floated should be got approved by the relevant TPC at Factory Level including cases falling under OFB/M of D Powers. For this purpose, every TPC meeting will undertake two functions viz. -

(i) Decisions on the list of Vendors on whom LTEs are to be floated and

(ii) Decisions on Tenders Opened based on CSTs placed before TPC.

b. To the extent of 20% open for New Sources : For developing new sources, OTE is to be floated to the extent of 20% of the Annual Ordering Quantity with a proviso that only capacity verified and duly registered Firms by DGQA for that particular Category of items (i.e. Category 'C' Vendors) should only participate. This will enable Category 'C' Vendors to come under Category 'A' - List after successful development. In these cases, orders may

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be placed on more than one Vendors in the interest of developing more Sources for wider competition with/without price differential within the financial powers of concerned authority, keeping in view the CVC Guidelines.

c. Necessity of Un-registered Established Source to get Registered :Once a Category 'B' Vendor secures an order for an item, he must immediately apply for Registration within a Month's time to DGQA/DGAQA/DGNAI (endorsing a copy to the Factory concerned) to become Category 'A' Vendor. Such Category 'B' Vendors will not be given Enquiries unless they get themselves Registered with DGQA/DGAQA/DGNAI within a reasonable time. Otherwise, they will be removed from the list of Category 'B' Vendors.

d. Option Clause : Against LTEs for Annual 80% requirement, orders may be placed on Established

Sources keeping in view the CVC Guidelines, even on more than one suppliers based on their past performance record and capacity to supply, with/without price differential within the delegated power to the authority concerned. Option Clause of minimum 25% on the ordered quantity may be incorporated in each such order to meet the programme requirement/unforeseen demands, keeping in view the Development Order may or may not materialise. Option Clause indication is to be incorporated in the Tender Enquiry itself.

e. DRDO developed New Products first time productionisation :When for the first time a Factory takes over the responsibility for bulk productionisation of a new end-product, LTE for about 80% of Annual Requirement may be floated for the item amongst the Category 'E' Vendors i.e. DRDO/AHSP recommended sources (obtained in writing) who have developed the item at the design and prototype development stage. Such Vendors will be advised for Registration with DGQA as per stipulation at Para 4.1(c) if not already Registered. Balance 20% requirement will be advertised as per stipulation at Para 4.1(b) for developing new sources.

f. Staggered Delivery Schedule : In all orders, staggered delivery schedule and connected payment schedules either on monthly or quarterly basis depending on volume of the order, requirement schedule and maximum Inventory Holding Level permissible etc. will be given. Such staggered delivery schedule should be incorporated in the tender itself.

g. Application of Vendor Rated Purchase System : In order to reduce the procurement lead time, when the number of Category 'A'

Vendors for 'A' Category items is very much limited i.e. 2 or 3 only, Vendor Rated Purchase System may be adopted and final allocation of the 80% Annual Order quantity with 25% Option Clause will be made on the basis of Vendor Rated weightages secured by the individual Vendors. In this connection, OFB Circular Letter No.517/Vendor/MM dated 07.08.85 may be referred to for guidance. The weightages on Vendor performance factors may, however, be decided by the relevant TPC prior to Tendering. Balance 20% will be advertised as per Para 4.1(b) for developing new sources.

5. OTHER THAN DEFENCE REQUIREMENTS5.1 Procurement of Direct Materials

The Purchase Procedure and Tendering System for all Direct Materials used for other than Defence Requirements will be the same as that enumerated above for Direct Materials used for Defence Requirement except that the Vendors need not be Registered with DGQA. They may get themselves Registered with the concerned

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Ordnance Factory or with DGS&D or in case of SSI Units with NSIC. A Vendor Registered with one Ordnance Factory for a specific item may be considered as Registered with other Ordnance Factories for the same or similar items.

6. INDIRECT REQUIREMENTS : 6.1. (Stock Items) :

a. As in the case of procurement of Direct Materials, for Indirect Materials also the category of Vendors available may broadly be divided as follows '(i) Registered with any Ordnance Factory/DGS&D/NSIC and Established

Vendors for a particular or similar item.(ii) Established Vendors but nor formally Registered as above.(iii) Registered but not yet an Established Vendor.(iv) Potential/renowned Vendors but neither Registered nor an Established

Supplier for a particular item.

b. LTE may be floated amongst the Registered Established Vendors. Number of Established Vendors to whom LTE should be floated may preferably be Six, or more if available, otherwise to the extent available.

c. Keeping CVC guidelines in view the entire ordering quantity may be allocated to more than one Established Vendors with/without price differential if the Ordering Quantity is sufficient enough for such allocation.

d. Registered Vendors' list for each item or similar items is to be maintained by each Factory.

e. Cancellation of Registration will be done every alternate year based on responses received and performance observed during the previous years.

6.2 (Non-Stock Items)

a. These are the ad-hoc one time requirement directly demanded by the Production/Operative Departments through ad-hoc requisitions. Mostly, the requirements are non-repetitive in nature.

b. Limited Tender Enquiry amongst the Registered Vendors for the same/similar items may be followed.

7. RATE/RUNNING CONTRACTS7.1 DGS&D Rate/Running Contracts :

In case of items for which DGS&D Rate/Running Contracts exist, the General Managers as Direct Demanding Officers (DDOs) will procure these items by placing direct orders on the Firms. Such purchases will be treated as Central Purchases.

7.2. OFB Rate/Running Contracts : For some 'A' and 'B' Category items Annual Rate/Running Contracts with reliable

Established Vendors through LTE may also be concluded within the delegated powers of GMs/OFB wherever DGS&D Rate/Running Contracts are not existing.

8. LONG TERM CONTRACTS :a. For certain Materials/Tools/Components required consecutively for 3/4 years or more for

production of End-Stores for which Firm Indents are available and are regular priority items of the Indentor, Long Term Contracts for 2 to 3 years may be concluded with more than one reliable Established Vendors through LTE, with appropriate delivery schedules by the concerned authority as per its delegated power. However, Factories should continue to take action for development of new sources as per the guidelines given.

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b. In all Long Term Contracts, the staggered requirement schedule of the consignee will be forwarded to the Vendors on bi-annual basis and in such a way that at any point of time neither any stock-out situation will arise nor the Inventory Level will exceed the maximum level prescribed.

9. It will be necessary for the General Managers to review their Inventories and Requirements from time to time and take necessary action for disposal of surpluses, if any, as per laid down procedure or procurement action for the deficiencies.

10. In order to avoid over-provisioning it should, however, be ensured that provisioning is not made on the basis of the entire demand of the services but on the basis of what the DGOF/GMs realistically expect to produce out of that demand during a particular provisioning period. The delivery dates shown in the indents should be staggered so that as far as possible, the actual stock at the factory, is restricted to the optimum levels as laid down below :-

(a) Imported Items 12 (Twelve) Months' requirement and 6 (Six) Months' Stockpile where authorised.

(b) Difficult Indigenous Items 6 (Six) Months' requirements and 3 (Three) Months' Stockpile where authorised.

(c) Ordinary Indigenous Items 6 (Six) Months' Working Stock

The General Managers will have complete freedom according to their judgement in maintaining stocks subject to ceiling limits mentioned above and availability of storage space to meet production targets.

( Authority : OFB U.O. No.10/6/MM dated 23.04.99 )

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Annexure-35OFB LETTER NO. 517/VENDOR/MM DATED 7.8.1985

NO.517/VENDOR/MMGOVERNMENT OF INDIA,MINISTRY OF DEFENCE,

ORDNANCE FACTORY BOARD,10-A, Auckland Road,

Calcutta-700001,DATED, THE 7th Aug ’85.

ToThe General Manager(All Ordnance Factories)………………………………………………………… Sub: IMPLEMENTATION OF VENDOR RATING SYSTEM IN ORDNANCE

FACTORIES.

While reviewing the progress made by Vehicle Factory, Jabalpur in the system of procuring stores on ‘Vendor Rating System’ for which specific Government order was issued, O.F.Board directed that the feasibility of existing V.R.System in other factories be considered.2. Following are the salient features of Vendor Rating System:- (i) Instead of issuing Tender Enquiries to a number of probable suppliers of any items,

the firms are selected for a specific item, on the basis of past performance and thus selected firms are called for negotiations, before Tender Purchase Committees. Firms are asked to give the quotations and prices negotiated, by the Tender Purchase Committee. Last paid rate and increase of price (if any) in the Raw materials etc. are kept in view by the Tender Purchase Committee, during negotiation, and prices are finalized. Normally yearly.

(ii)Performance of the firms initially are adjudged on the past one year’s performance in respect of delivery, quality and after sales service of the respective firms and firms are selected for specified items.

(iii) After having determined the prices as indicated in para (i) above, the shares of

business among the selected firms are determined as per formula explained in the following paragraphs.

(iv) For assessing the rating of the firm, the following percentages are ear-marked for

the rating elements :- Price………… ………….. 50% Quality……… …………... 20% to 25% Delivery…….. …………... 20% to 25% Service………. ………….... 5%

The percentage can be varied, depending upon the item, but keeping the factor for price as 50%.

OFB ‘s guidelines, issued earlier to VFJ is attached herewith for information, as Annexure-‘A’. A sample calculation of determining the share of business is attached as annexure ‘B’.

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It has been found that this system brings discipline among the suppliers as failure on their part, in adhering to deliveries, in maintaining adequate quality level etc. will affect the future orders. At the same time, firms are assured of the future orders. This system cuts down the long drawn normal procedure of issue of Tender Enquiry etc. Further, this eliminates stepping in of firms, which may quote at lower levels and bag the orders, yet do not effect supplies, which in turn affects production.

20% of the total annual requirement can be kept aside for development of new sources in case of non performance of selected firms for some unavoidable reason.

With the above back ground, the General Managers are requested to examine the suitability of the new system of procurement, as far as their factories are concerned and forward their comments.

General Managers are also requested to select 15/20 items which can be procured, on vendor rating system, on an experimental basis, to start with and also to forward the list of items along with annual requirement and the list of firms, on or before 30.8.85. for further processing the case, with a view to explore the possibility of introducing the new system in other ordnance factories.

Sd/-(V.V.KARMARKAR)

MEMBER/P&MMFor Director eneral Ordnance Factories.

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Annexure-36OFB LETTER NO TU/TN/7401/POLICY/INVENTORY DATED 21.5.1981.

ANNEXURE ‘A’MOST IMMEDIATE,

NO.TU/TN/7401/POLICY/INVENTORYGOVERNMENT OF INDIA,

ORDNANCE FACTORY BOARD,44, PARK STREET, CAL-16,DATED, THE 21 MAY 1981.

To,The General Manager,Vehicle Factory,JABALPUR. (Attn. : Shri K.D.Kalia, GM)

Sub: Introduction of vendor rated system of purchase and placement of long term purchase order for selected vehicle items.

Ref: i) MofD Letter No. G.4(4)/Admin/78/OFC dt. 1.7.80. ii) Correspondence resting with your Letter No. 711/Jt.GM/V.Rating/80 dated

13.11.80.

The subject matter has received attention of the OFB at the hightest level at a meeting chaired by Chairman on 16.5.81 and attended by Member/Finance, Member/WV&E, Member/TD&S and DDG/Veh. After careful consideration it has been decided that fot the purpose of introducing the system, short-closure and conversion of the existing contracts into the new variety is not desirable and that the new system will be introduced by GM/VFJ for each of the items selected as and when fresh and further purchase necessity arises for the relevant items.

2. The OFB have also decided that the vendors for the selected items will need to be informed of the essential/ salient points in the new system. For this purpose the draft of a suitable letter to be addressed to each vendor by you is enclosed.

3. A envisaged in the above Govt. Letter vide ref. (i) above, OFB are to approve guidelines to be followed by GM/VFJ for implementing the new system. Accordingly, a set of guidelines is enclosed and the same should be followed by GM/VFJ in proceeding further in the matter. It will be seen from the guidelines that OFB have laid down the weightage factor for price at 50%, the remaining weightage factors being left to be decided by the eneral Manager.

4. You are now requested to implement the system with utmost speed and monitor the progress as well as the results to enable Govt. being intimated suitably in due course.Encl. : As above.

Sd/-(N.M.PATEL)

DDG/VEH.FOR DGOF/CHAIRMAN, OFB.

COPY TO :-FINANCE DIVISION- together with enclosures.

Enclosure to OFB letter no. TU/TN/7401/Policy/Inventory dated 21.5.1981.

GUIDELINES FOR ENTERING INTO VENDOR RATED CONTRACT

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(1) Quantity to be ordered : Quantities to be ordered on each occasion shall be determined in accordance with the

authorized provisioning procedure, subject to such deviation, where necessary, as has been authorized in Ministry of Defence letter no. G.4(4)/Admin/28/OFC dt. 1.7.80.

20% of the quantity assessed as available for ordering will be earmarked for developing new source/sources. The firms which are thus promoted as capable sources should be brought on to the vendor list for the relevant item subsequently. The vendors who persistently fail should be weeded out.

(2) No. of items to be covered under Vendor Rated System. Vendor rated system will be applied to 15 selected items for each of the three types of

vehicles i.e. 45 items in all as laid down in the ovt. Letter.

(3) Conditions of contract. The standard terms and conditions of contracts laid down in connection with purchase of

stores for the ordnance factories including payment terms, liquidated damages for delay in supply, risk purchase etc. shall apply to vendor rated contracts also. If, in any exceptional case, the supplier insists on deletion of the L.D. or any other clause, the G.M., in consultation with JCF&A, may authorize the same, if he has been empowered to do so under specific Government orders. In all other cases, OFB should be approached for prior approval before deviating from any of the standard terms and conditions.

(4) Payment terms. Where payment against suppliers’ Inspection Notes is agreed to, suitable warranty clause

should be provided in the contract to ensure replacement of stores found defective on receipt of the consignee’s end or to recover full cost of such stores including transportation charges.

(5) Delivery Schedule and Price. In the vendor rated contracts, whatever quantity is ordered on firm price/firm delivery basis, the vendor must be held responsible for maintaining the agreed delivery schedule as well as the price. Even if extension of D/P is granted on the merits of the case, this shall be without any liability for upward revision of price for any reason whatsoever.(6) Weightage factors : Since the vendor rated contracts are intended to be placed on the established and rated suppliers only the rating factor on account of price should be the highest-50%, the other weightage factors will be decided upon by GM/VFJ depending upon the nature and criticality of the item.

(7) Negotiation with vendors : All negotiations with the vendors shall be conducted by the appropriate TPC. The methodology for negotiation and arriving at a reasonable price allowing for variation in the cost of the input elements over a period of time may be determined by the GM in consultation with JCF&A in the light of past experience. In such case, written communications should be obtained from the vendors confirming the price, quantities and other terms agreed upon in the negotiations, before a formal order is released.

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Enclosure to OFB LETTER NO. TU/TN/7401/Policy/Inventory dt. 21.5.81.DREAFT LETTER TO SELECTED SUPPLIERS FOR ADOPTION OF VENDOR RATED PURCHASE SYSTEM.

NO.Vehicle Factory,

Jabalpur-482009. Dated:

To……………………………..…………………………….. Sub: Introduction of vendor rated system of purchase at VFJ.Dear Sirs, VFJ is thankful to your company for supporting manufacture of Defence Vehicles by your supply of the following items:- ………………………………………………………………. ………………………………………………………………. As you are aware supplies until now are being procured from you through placement of Supply Orders/ Contacts on the basis of tender enquiry and offers received in response thereto. It has now been decided to introduce vendor rated system of purchase for certain selected items which include the items mentioned above. In new system of vendor rated purchase, Supply Orders instead of being placed through invitation of tenders as hithertofore will now be placed through negotiation with rated vendors on the basis of the ruling unit rate/last paid rate and settlement through negotiation, if necessary. Your share of business in relation to other rated vendors, will be determined on the basis of factors of rate per unit, quality, adherence to Delivery schedule and possession by you of essential supporting facilities like R&D, Quality Control, after sales service etc. Each of the items selected for vendor rated system or purchase, will be given individual weightage factors for price, quality, delivery performance and other factors such as after sales service, dependability as evidenced by supplies during critical time, prompt replacement against FRO/Warranty and prompt carryng out of rectification/repars work depending upon the nature of the component, its criticality from functional and safety points of view, manufacturing process, cost savings, importance of finish, passenger safety and comfort etc. Your performance during the period from…………… (date)………………..to (date) will be evaluated against the above factors to determine your rating and hence your share of business in the total quantum to be procured and a S.O. will be placed on you for a period of one year initially with option to increase quantity for further two years’ requirements, one year’s at a time, and the monthly delivery schedule will also be stipulated. The Supply order to be placed on you on the above basis will indicate the quantity to be supplied by you within a period of one year with firm delivery schedule for the first quarter after commencement of delivery, and tentative delivery schedule for the subsequent quarter. The tentative delivery schedule for each subsequent quarter will be firmed up to 6 to 8 weeks in advance. The quantity on order remaining outstanding at the end of the year will have to supplied at the same rate as agreed to for the relevant period of delivery schedule. At the end of the year your new share of business will be re-assessed on the basis of your performance and rating during the year and intimated to you for supply during next year aling with the delivery schedule. As far as other and general conditions/terms of supply are concerned, those prevailing in the existing system or as modified by mutual agreement will apply. In the new system to purchase, Supply order will be placed either on the basis of a base rate plus a price variation clause for selected items of input which will operate during the course of the year or on a Firm and fixed basis for each six monthly period to be up-dated at the end of every six months as may be acceptable to you. For the purpose of updation of price negotiation will be held with you if found necessary.

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Since the advantages of Vendor Rated purchase system for both the Seller and Buyer are self-evident, it is expected that you will invest in tooling, R&D and after sales service supports in order to enable you to obtain the maximum share of business. VFJ has no doubt that you would like to be associated with it as a supplier of Defence Vehicle items.

Annexure-37MEMBER/P&MM CIRCULAR NO.10/6/MM DATED 8.10.1982

P&MM DIVISIONMM SECTION

5, ESPLANADE EAST,CALCUTTA.

No. 10/6/MM Dated the 8.10.1982.

Sub: Guidelines for procurement of stores by Ordnance Factory /Board. Ref: Mof D No. 1(82)/78/D(Fy-1) dt. 9.2.1982 Circulated under R.N.No.868/A/A

dated 14/22-3-1979 and OFB No. 02/Policy/SP/DP dated 7.7.1980.

The Guide Lines on the above subject as enumerated in the Annexure has been considered and approved in the O.F.Board’s meeting held on 2.8.1982. This issues with the concurrence of Member/ Finance vide Finance Division U.O. No. 4888/II/OF dated 20.9.82.

Enclo: Annexure-‘A’

(O.P.BEHL)MEMBER/P&MM

FOR DIRECTOR GENERAL ORDNANCE FACTORIES.

Copy forwarded to :-1) The Chairman, Ordnance Factory Board.2) All Members, ------------------------------.3) The Controller of Accounts (Fys), 9, Chittaranjen Avenue, Calcutta-72. (5 copies).4) The Chief Internal Auditor, 9, Chittaranjen Avenue, Calcutta-72. (5 copies).

5) Finance Division-(5 copies). 6) The Director of Audit (Ord/Fys),

9, Chittaranjen Avenue, Calcutta-72. (5 copies). 7) Copy Signed in Ink Controller of Accounts (Fys) Calcutta-72. 8) All Officers of SP Group.-------------------------------- 9) All Section of O.F.Board.-------------------------------- 10) Guard File. 11) C of A (Fys), Audit Cell.

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Enclosure to Circular No. 10/6/MM dt. 08.10.1982.GUIDE LINES FOR PROCUREMENT OF STORES BY ORDNANCE FACTORY BOARD.

1.1 Limited Tenders can be resorted to in respect of items which are to be procured from trade ex-manufacture specially for Ordnance Factories production. LTEs in such cases will be issued to all established suppliers. For this purchase, the number of established sources should be minimum six. If the number of established sources is less than six, open tender should be resorted to normally.

NOTE.(a) LTEs should be issued with the prior approval of Chairman TPC and appropriate officer of

Finance Division in the relevant TPC and the reason for such decision shall be recorded.(b) A source can be considered as established if they have at least twice successfully met the

requirements.(c) In exceptional cases where there are limited number of established suppliers in case of

certain specialized items (i.e. Tungsten Carbide Cores of certain specialized vehicle components, components and half wroughts for Armoured Vehicles) limited tender will be issued to firms even in less than 6 established sources-in such cases the specific reasons which necessitated this action should be recorded in writing in each case.

1.2 DEFINITION OF “ITEM EX-MANUFACTURE” An item is called ex-maufacture from trade when the item has to be manufactured to meet the specific requirement of service drawings/ specifications and not an item freely available ex-shelf in the market.

1.3 OPEN TENDER Open Tender enquiry will be issued for every third cycle of provisioning (first and second cycle by restricted tenders and the third cycle by open tender and so on ). Offers received will be evaluated by the relevant TPC with the recommendations for placement of orders on merits of untried sources/ tried and trusted sources as the case may be. Proposal fpr supply orders on differential price, if involved, will be submitted to O.F.Board/ Ministry of Defence is applicable in each case.

2.0 SOURCE DEVELOPMENT 2.1 Source development will be necessary when the number of existing established surces is less than six as also under the following circumstances.(a) When it is apprehended that the established sources have formed a group and quote to the disadvantage of the Government.(b) When the rates offered by the established sources are considered high and not realistic in terms of the prevailing market conditions.(c) When the capacity of established sources is not adequate to meet our requirement including contingencies may arise due to failure of any source.

2.2 While source development is necessary when the established sources number less than six, the question of necessity for development of other sources under other conditions will be decided by the relevant TPC. 2.3 The quantity –reserved for development of additional sources should normally be 20% of the annual requirement, the balance quantity procured as per normal procedure as amplified by these Guidelines.2.4 For the purpose of developing new sources, advertisement will be issued for listing new firms indicating at the time of advertisement, the quantity that are likely to be placed as development order on them. Interested parties will be have to furnished all particulars of their capacity, experience in the field, details of supplies made to various parties, financial standing,

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I.T certificates, Bank references etc. Order placed based on this advertisement will be of development nature. The power of the board for development of source vide M of D letter No. F.12 (47)/80/D(Projects) dated 6.6.1981 will be exercised. At present this power is only for 5 lakhs. Enhancement of this power is being sought for separately.

Annexure-38DECENTRALISATION OF PROCUREMENT OF EXCLUSIVE ITEMS

No. 513/Exclusives/MMGOVERNMENT OF INDIAMINISTRY OF DEFENCE

ORDNANCE FACTORY BOARD10A, Auckland Road, Calcutta-700001

Dated the 7.6.1995To, The General Manager, All Ordnance Factories.

Sub: Decentralization of procurement of exclusive items. Ref: OFB No. 513/Exclusive/MM dt. 15.11.84.

It has been decided by OFB that procurement of stores listed in the letter quoted above as exclusive items will be decentralized for procurement w.e.f. 1.7.85. GMs of Ordnance Factories should not therefore forward any more indents for these stores to OF Board w.e.f. 1.7.85. Action coverage of the indents available with OFBoard pertaining to each factory will be taken by this office and the position will be intimated to them separately item wise in due course.2. While processing the procurement of these stores at the factory level as per provisioning procedure the following guidelines should be followed:-

(a) GMs of factories having a common items of purchase should ascertain the rates and other relevant information from the sister factories while initiating/ finalizing procurement action for evaluating tendered rates vis-à-vis last paid rates in order to ensure smooth supply at reasonably competitive rates.

(b) Selection of vendors for Limited Tender Enquiries will be decided by the relevant TPC consisting of thr Chairman of the TPC, Materials Manager /Provision Officer and Local Finance/ Accounts Officer.

(c) After opening of tender the local TPC will finalise the tender in the usual manner and these will include counter offer/ negotiation as deemed necessary.

(d) Cases involving price diffential will be referred by the GMs for prior approval of the Board.

(e) In cases where the value of purchase is within the financial powers of the factory management the contract can be concluded at the factory level based on the decision of the relevant factory level TPC.

(f) Where the value of purchase is beyond the financial powers of the GMs the recommendation of the TPC at the factory level should be forwarded to the concerned section in SP Group through a courier, if time does not permit transmission by post alomg with all the relevant papers of the case in proper format (viz. Ranking Statement, Data Sheet and TPC proceedings).

(g) ENERAL Managers will place Supply Orders on the concerned firms based on the sanction received from OF Board.

(h) Ms should frame delivery period in the supply order realistically so that cases of extension of the delivery period is minimum.

3. Working of this new scheme will be reviewed after 2 years.4. Kindly acknowledge receipt.

Sd/-

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(V.V.KARMAKAR)MEMBER/P&MM

For Director eneral Ordnance Factories.

Copy to:All Members/OFB.Addl DG/OEF, Kanpur.Addl DG/AV, Avadi.All DDGs.Controller of Accounts (Fys)Finance Division, OFB Calcutta.All Jt. C of A (Fys)All Accounts Officers (Fys).All Officers of SP Group.Secretary OFBoard—with reference to R.N.No. P&MM/BS dt. 17.6.85.All sections of SP Group.Guard File.

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Annexure-39MEMBER/P&MM AND TS D.O.NO 01/6/MM DATED 30.12.1987

V.M.BHANDARKARMEMBER/ P&MM &TS.D.O. NO. 01/6/MM

GOVERNMENT OF INDIAMINISTRY OF DEFENCE

ORDNANCE FACTORY BOARDAYUDH BHAWAN

10A, Auckland Road, Calcutta-700001Dated the 30th December, 1987.

My Dear I find that the procurement proposals are received in this Hqrs. In the last stages and pressures are put for quick clearance of the cases. Proposals are also received for the stores required for this year production even upto November/December, 1987. Obviously such a situation is undesirable and lacks proper planning and co-ordination.

2.0 GMs are empowered to initiate procurement cases upto 12 months requirement in respect of imported items, 36 months in respect of difficult indigenous items and 30 months in respect of indigenous items including the stock and dues, as per DGOF letter No. 01/6/MM dated 18-9-84. While adequate care should be taken in respect of ‘B’ &’C’ Category items at the factory level, a special attention is required to be given in respect of ‘A’ Category items, the value of procurement proposals of which would normally fall within the financial powers of dgof/mod. Please divide after after a review those A type items as A1 and A2 i.e. those beyond OFB’s financial power and hence to go to Mof D and these within OFB’s financial power separately. Normally one month’s time should be allowed for OFB for processing the cases and for according sanction i.e. the A2 category. In cases where the value exceeds OFB’s power i.e. A1 cases, Ministry may normally take about three months time apart from a month’s period for processing at OFB. This is stated from past experience and analysis made in OFB.

1.0 The above fact should be kept in view while forwarding cases to OFB.

2.0 The Material Management should organize review of all ‘A’ category items preferably earlier to January of each year, depending upon the lead time required and forward a list of cases which are expected to be forwarded to OFB during the financial year by January/ February indicating therein the probable period of forwarding the cases to OFB. The factories should adhere to the above programme except circumstances beyond control.

3.0 The validity of the quotations should be such that adequate time is available for processing the cases at OFB or M of D as the case may be, on the guidelines indicated above.

4.0 The proposals for importation of stores should also be examined before January of each year and a finalized list of items, proposed to be forwarded in the subsequent financial year should be prepared and forwarded to OFB by end of January each year indicating the FE requirement. This will facilitate adequate projection of FE requirement in time.

5.0 In view of the above, the first list of proposals of both the indigenous procurement, falling within the powers of OFB/ M of D and also the import proposals, planned to be forwarded during 1988-89 may be sent to OFB by end of January, 1988 positively with plan of action.

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Kindly acknowledge receipt. With best wishes,

Yours sincerely,(V.M.BHANDARKAR)

Annexure-40DDG/SP CIRCULAR NO. 14/4/LP/MM DATED 4.10.1988.

JAGJIT SINGHDEPUTY DIRECTOR GENERAL/SP

GOVERNMENT OF INDIAMINISTRY OF DEFENCE

ORDNANCE FACTORY BOARDAYUDH BHAWAN

10A, Auckland Road, Calcutta-700001 Dated the 4th October 1988.

D.O.NO.14/4/LP/MM

My dear Of late while considering purchase proposal in TPCs in respect of those stores where a number of successful suppliers are available, a certain tendency of suspected collusive bidding on the part of some suppliers is being noticed. When he suppliers were called upon to explain the reason for the absence of mutual competitiveness among themselves they attributed the same to the alleged policy of our organization of equalisin the tenderers, irrespective of their original ranking by offering the lowest rate to all and distributing the ordered quantity without giving any special recognition to the initial lowest technically acceptable bidders. Although they may not be fully correct but serious note has been taken of the arguments advanced by them.

Therefore, with a view to having a uniform principled basis of tender selection it has been decided that the following guidelines may be followed during the TPC meetings for placing the orders :

a) Before placing the order it should be decided whether the tender enquiry is meant for placing the order on already developed sources or for developing new sources. In the same tender enquiry quotations should not be invited from developed as well as undeveloped sources as far as practicable. For undeveloped sources separate tender enquiry should invariably be floated to the prospective likely suppliers.

b) Major portion of the quantity tendered may be ordered on the lowest tenderer provided i) the rates are reasonable ii) the firm has the capacity to supply the items in full as per the desired delivery schedule.

Therefore, efforts may be made to bring down other higher bidders to the level of the lowest acceptable offer and the balance quantity may be distributed suitably depending upon the result of negotiations.

So far as vendor rating is concerned, more number of vendors may be developed. In case it is found that the existing suppliers are unreasonably hiking up their prices or their performance is not upto the mark with respect to quality, delivery schedule or any other aspects. The process may be time consuming but it will keep alive the competitive spirit amongst the firms.

With kind regards,Yours sincerely,

Sd/-(JAGJIT SINGH)

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To All General Managers.

Annexure-41CIRCULAR DATED 27.12.1990 FROM DDG/SP FOR PURCHASE OF ‘A’ CLASS ITEMS

UNDER OFB’S POWER

No.14/4/LP/MMGOVERNMENT OF INDIAMINISTRY OF DEFENCE

ORDNANCE FACTORY BOARDAYUDH BHAWAN

10A, Auckland Road, Calcutta-700001 Dated the 27th December 1990.

The general Manager,All Ordnance Factories,

Sub: Purchase of ‘A’ Class items under OFB’s power. Ref: i) D.O.No. 14/4/LP/MM dt. 30.12.87 and 28.7.88 addressed to GM by Shri

V.M.Bhandarkar, the then Member/P&MM &TS.ii) D.O.No. 14/4/LP/MM dt. 4.10.88 addressed to GM by Shri Jagjit

Singh, the then DDG/SP.

Certain directives were given by the then Member/P&MM &TS vide his D.O. dated 30.12.87 and 28.7.88 in the ares of purchase of stores. Gist of the directives is given as under:

1.1 The factories are required to give special attention to ‘A’ category items, particularly those for which the procurement proposal would normally fall outside the gM’s power and are required to be sanctioned by OFB of MofD. In respect of such ‘A’ category items it was advised that a review should be conducted in January of each year depending upon lead time required and forward a list of of cases which are expected to be sent to OFB during the financial year indicating therein, the probable period of forwarding the cases to OFB. It was also to be ensured that the validity of the quotation was adequate and sufficient to process the cases and issue the sanctions.

1.2 All the purchase proposals were to be completed in all respects including documents like ranking statement, data sheet, last paid rate, outstanding against last order, outstanding orders for the end store, programme for the end store, TPC minutes etc. It was categorically advised that all these proposals, being sent to OFB should have the GM’s approval, even it lower level TPC at the factory had taken the decision within its financial power.

1.3 The requirement for which tender is floated bebased on firm annual programme and keeping in consideration the various aspects such as urgency of stores, inventory control norms etc.

2 The intention behind issue of these guidelines was to help the factories in processing their cases quickly and to avoid financial repercussion arising out of delay in processing or delay in supply of materials with attendant repercussions on production targets. Unfortunately however, it is seen that these guidelines are not being fully observed. In fact, some of the factories have still not sent the list of ‘A’ class items which they propose to procure under OFB/ M OF D’s power in the current year and in some of the proposals even the basic data for processing the cases is not given. This necessitates repeated references to the factory which in turn involves delay in processing and loss of validity of quotations. A few cases have also been noticed where the factories have taken as much as 4-6 months’ time after the tender opening in holding their TPCs and sending the papers to OFB. The proposals have been sent

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at a stage when the available validity of quotations is hardly a few days and therefore frantic requests from the factories are made at various levels for according top priority as stocks are exhausted. In such cases it has also been observed that the information relating to stock, dues, outstanding orders for material, the issue of the end stores, outstanding issue for the end store etc. has been indicated as on the date of the preparation of the data sheet which in itself is quite old and does not serve the intended purpose.

2.1 Special attention is therefore required to be paid by the factories to the following points when putting up proposals to OFB for sanction for procurement of stores:

ii) All the required information as on date of dispatch of proposal to OFB

should be filled in the data sheet and ranking statement. No column should be left blank. It must be ensured that the production rate of item and the scale per item of production should be clearly indicated with data sheet by the factory in all cases.

iii) In case of IFD items to be recovered from sister factories the supply programme against the IFD should be intimated with detailed cost break up. Where IFD costs are very high compared with the trade cost, this should be highlighted. Besides, it is necessary to ensure that the IFD programme is in keeping with the final issue planned. Therefore, prchase of items for IFD manufacture has to be monitored closely and operating Division at OFBoard informed of the supplies vis-à-vis the IFD programme.

iv) In the data sheet the total dues should tally with the quantity outstanding against the supply orders.

v) Sometimes it is observed that the monthly requirement bears no relation to the production programme. This type of error should be avoided.

vi) A separate statement should be given indicating the monthly rate of supply against the past supply orders.

vii) The ranking statement and data sheet should be duly signed by the concerned officer.

viii) If any price variation clause was applicable to the last supply order for the same store, the present price being paid by application of PV formula should be indicated with details of calculation.

ix) In case of items being procured for the first time, factory’s comments on reasonableness of the proposed price and break up of cost given by the firms should be furnished.

x) In case of items developed by ARDE, the rate paid by ARDE should be indicated.

xi) It is necessary that eligible sources are only referred with the Limited Tender Enquiry. For this Vendor Rating should be arranged and those contractors who have supplied the store in time and quantity should be asked to quote. The list of contractors who have to be referred by Limited Tender Enquiry for ‘A’ category items should be finalized by GM in consultation with his TPC-1 members. 80% to 90% of the annual requirement should be covered by such action.

xii) For additional source development a separate tender enquiry covering 10 to 20% of the requirement can be covered with new likely sources. This will ensure Production Plan and quantity target to be met in time as well as new sources developed so that established sources do not dictate terms to the purchaser.

xiii) For ARDE/ERDL developed stores, first the sources developed by ARDE/ERDL during development should be used for bulk production even if it involves single tender action. However, later on other sources can be added on the lines given. As the price paid by ARDE while developing source for new items may include part/ full development cost,

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it is necessary to ascertain the of ARDE purchase and verify reasonableness of cost before placement of bulk order.

3. Consequent to the budgetary constraint now enforced by the Government on expenditure for purchase of materials as well as on the issue of finished stores to the Army, it has now become necessary to ensure that available funds are utilized primarily for the priority items of the Services for all the factories. The proposal for purchase of materials are, therefore, required to be closely interlinked with the priority and quantity of the end store for which these materials are to be procured. In this connection Member/ Finance D.O.NO. 001/FYS/89-90/F/B dated 23.8.89 addressed to all GMs may kindly be referred. It has been categorically mentioned therein that the allotment which would be received by the factory from the finance division will be the final allotment to cater to the needs for whole year and there will be no scope for making any additional fund available at the fag end of the year irrespective of the repercussions it may have called upon to make careful review of the supplies that are likely to materialize against orders already placed as well as those likely to be placed during the rest of the year and assess the payment liability during the financial year. Considerable planning is, therefore, necessary to avoid situations requiring budget over runs.4. From time to time directives have also been issued with regard to reduction in the inventory held by the factory in respect of all the categories such as active stores, maintenance stores, work in progress, finished stores, non-moving and slow-moving etc. Despite these, it is seen that some of the factories have large raw material inventories (more than 180 days of consumption). As such they should look into the stock and utilize the available stores and bring down the raw material inventories to less than 180 days of consumption before initiating fresh purchase. The material purchase programme are therefore required to be planned in detail and well in advance to meet the production target within the available budgetary provision and with least possible inventory holding. Chairman/OFB’s D.O. to GMs No. 0601/90/C dated 14.6.90 may please be referred. In this D.O. the Chairman has laid down certain targets for minimizing inventory levels. A copy of the monthly report called for as per enclosure to this D.O. may kindly be sent to DDG/SP also.

5. In order to achieve the objectives some of the guidelines which have already been issued are clarified/ modified as under :5.1 The material Management Group of the factory should immediately organize review of all ‘A’ category items. The definition of ABC class of items is already known to the factories. It is expected that ‘A’ class items would involve expenditure of 75 to 80% of the total expenditure. The programme in respect of all ‘A’ class items may be intimated to DDG/SP as per format enclosed latest by 31.1.91. This programme should also indicate items which will be procured under GM’s powers and the cases which will be sent to OFB, the purchase being beyond GM’s powers. After receipt of this information OFB (Section MM) will allot central code number to each of such proposals and only those proposals for which code numbers have been allotted will be progressed. Unless there are strong and sufficient reasons for procuring items which were not in the list as above, no item can be later on added to this list for procurement under OFB/Mof D’s power.5.2 As given in the format mentioned above , the factories are required to give for each ‘A’ class item the propramme of procurement indicating likely date of forwarding of papers to OFB etc. It is expected that this propramme will be adhered to and exceptions will be few.5.3 Although such programme would be made in respect of ‘A’ class items for which proposals are to be sent to OFB, it would be advantageous if the factory follows similar procedure even for ‘A’ and ‘B’ class items to be procured under GM’s power. This planning action will enable the GMs to (i) maintain the procurement budget within the allotment. (ii) ensure optimum utilization of the budget keeping inview the priority and importance of the end stores (iii) maintain production programme by catering necessary changes in other inputs.5.4 It was earlier advised vide the then DDG/SP’s D.O. dated 4.10.88 that after receipt of tenders at factory, negotiation may be made with the tenderers to bring them down to the minimum and then send the relevant papers with the local TPC recommendations to OFB. The policy of doing negotiation, no doubt, has been helpful so long the items were to be established and reliable sources were to be developed. Presently, however, it is seen that negotiations in each and every case has denied the advantage of tendering system and has, in fact, led to a situation

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where the tenderers are getting an opportunity to come to an understanding within themselves. In order to remove such a possibility it has been decided as under :5.4.1 In respect of ‘A’ class items each factory will assess the labour content, material content (both quantitywise and costwise) and other elements of cost. For this purpose it is advisable to form a small committee of 2-3 officers from production/maintenance/ Accounts Sections and who are not connected with purchases of the factory. The committee should report directly to GM/Addl. GM and should make out its own strategy to find the cost structure of the ‘A’ class items. If the items were/are being produced in some of the OFs, the material/manufacturing rate forms could provide some basis for assessment of direct labour and materials.5.4.2 In all cases where purchase is under OFB powers, NO REPEAT NO NEGOTIATIONS WILL BE DONE AT FACTORY LEVEL. The TPC at the factory level will assenble and consider the quotations received and record its views and recommendations and send the case with all enclosures etc. to OFB within 10 days of tender opening. As soon as the committee as at para 5.4.1 starts functioning its advice on the cost structure will be obtained prior to TPC meeting and may be deliberated upon while formulating TPC recommendations.5.5 In respect of purchases of ‘A’ and ‘B’ class items under GM’s powers the relevant TPC at the factory may decide whether to have negotiations or not. Unless there is a large difference in the lowest purchase price or with reference to the estimated price as per the cost structure arrived at by the committee, negotiations may not be held. Adistict message should go to the suppliers that negotiations is an exception and they must quote their minimum rate at the first opportunity itself and major part of the order will go to the lowest bidder. In this context the contents of para 5.5 of the material management may be kept in view. Broadly negotiations should not be resorted to when there is sufficient competition which is considered genuine by the Factory/TPC and when the rates quoted by the firm (s) are considered reasonable by the said TPC.5.6 The items where GM feels that sufficient competition does not exist or where suppliers are forming cartels before tendering, planned possible solutions could be : (i) Development of ancillary units where the items is likely to be in service for a long time. (ii) Develop additional new soueces (upto six sources) by going in for open tendering. Such a source development should not be at the cost of production target which have to be met. On monthly, quarterly and yearly basis. For OFB PURCHASES OF MATERIAL IS NOT AN END. THEY ARE MEANS TO ACHIEVE THE GOAL THAT IS TIMELY DELIVERY OF STORES TO SERVICES (i.e. to meet monthly, quarterly, yearly targey positively). Hence the direction at para 2.1 (x) and (xi) and even (xii) be followed carefully.(iii) A larger portion of the order may be placed on the firm which had originally quoted lowest prices or which becomes instrumental in lowering the price in the negotiations, if carried out. Equal distribution of order to all tenderers who originally quoted different prices but later on agree to a common price may encourage cartel forming.5.7 With each proposal a certificate is required to be sent conforming that the purchase as proposed will be within the budgetary grants allocated to the factory and no additional funds would be required in the current/next year to finance the purchase.5.8 The union budget is announced at the end of February. It is generally seen that in respect of tenders which are opened in the month of January/ February the tenderers give very short validity and increase the prices after the budget is announced. It would, therefore, be preferable to finalise major purchases before January. In case tenders have to be necessarily opened in January these should be processed fast for placement and acceptance of the supply orders well before expiry of their validity. In any case unless special circumstances warrant it, tenders to be opened in the later half of February should be avoided.5.9 For indigenous items when the tender enquiry is for establishing new sources, the same should be separate and limited tender should not be sent to established sources as well as new sources as such an action creates complications in decision making after tender opening. Supply orders in respect of new stores should be for a small quantity and clauses pertaining to risk purchase etc. may be deleted. In this connection please guidelines at 2.1 (x) and (xi).5.10 In the cases of S.Os already placed on fixed and firm price basis, price increase claimed by the firms on any ground whatsoever, should not REPEAT NOT be accepted in anticipation of OFB’ sanction on ex-post-facto basis. OFB do not desire to entertain any exfacto cases for

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sanction. In case of urgency the cases be sent by hand through courier to DDG/SP who will ensure their prompt clearance from relevant TPC of OFB.5.11 In respect of ‘A’ class items which are common to more than one factory, it is necessary that all such factories keep updated informations about latest prices being paid/offered to other factories by the vendors. This will avoid higher prices being paid by a factory for the same item. If purchasers options are available for ordering more quantity, it is essential that lowest prices on order of any factory should be ascertained and optional quantity should be ordered at these lowest prices after obtaining vendors confirmation of the same.5.12 With regard o imported items particularly importation of spares and accessories certain guidelines have been issued vide OFB No. 01/GENL/SP/3 dated 8.6.90.

6 Kindly acknowledge receipt and ensure that the information called in para 5.1 and the monthly reports are sent regularly in time without any need for issue of expeditors.

Sd/-(A.V.DHEKNE)

DDG/SPFOR DIRECTOR GENERAL ORD.FYS.

Copy to: Chairman/OFB All Members/Addl.DGOF. All DDGs and Directors. Controller of Finance. Director Staff College.0.

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Annexure-42MOD LETTER NO.4(14)/92-D(SII) DATED 7.8.1992.

OFFICE MEMORANDUM

Sub: Placement of Orders on production agencies associated with DRDO in development of defence stores.

The modality for placement of the first bulk order on the production agency associated with DRDO in the development of a defence item has been under consideration of the Government for some time past. It has now been decided that the supplies wing will place the first bulk order on the production agency (s) associated with DRDO in the development of defence item and the following procedure will be adopted for this purpose:-

(a) There should be a reservation of quantity not exceeding 50% of the initial order quantity for production agency (s) associated with DRDO in the development of the product.

(b) Where the initial quantity is not large enough to be split and/or the item is a high-tech one requiring substantial investment even at the time of development in terms of plant and machinery, the entire quantity shall be covered on such production agency (s).

(c) In the case of (a) above, the price will be settled on the basis of competitive quotations by issuing tender enquiry to other agencies who, though not associated with the development of the product, are considered competent to productionise the item. In such a case, if the production agency associated with the development of the product quotes a price higher than the lowest acceptable offer, such agency shall be asked to match the lowest price, failing which they can be considered for a price preference not exceeding 15% over the lowest acceptable offer.

(d) Cost , data for which are available to the concerned agency of DRDO.(e) The dispensation as indicated above shall be given to the production agency associated

with DRDO only where their association is with regard to the development of an item which can be separately procured.

(f) Even in case the DRDO approved source is not registered with them, then bulk order can be placed on them. However, their continuance as an established supplier of the item will be subject to their capacity verification and registration by DGQA.

2. This issues with the concurrence of Integrated Finance vide their UO No. 667-SF/Addl FA (A) dt. 31.7.92.

Sd/- (Phool Singh)

Dy Secretary to the Govt. of India.

SA to RM & Director General Res & Dev., New Delhi. Chairman, Ordnance Factory Board. Master General Ordnance. AOM (Air HQ) COM (Naval HQrs.) DGOS. DGQA. All Chairmam, Technical Committees. Secy (DP&S).

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AS (DP&S). Addl FA (A). Addl FA (R).

Annexure-43OFB CIRCULAR NO. 14/4/LP/MM (VOL-XI) DATED 7.6.1995.

GOVERNMENT OF INDIAMINISTRY OF DEFENCE

ORDNANCE FACTORY BOARDAYUDH BHAWAN

10A, Auckland Road, Calcutta-700001Dated the 7.6.1995

No. 14/4/LP/MM(Vol-XI)

To, The General Manager, ---------------------------

Sub: Floating of Tender Enquiries for procurement of stores. Ref: This office circular letter No. 14/4/LP/MM dated 27.121990.

It has been observed during a recent TPC-I meeting held at this Hqrs. That an Ord. Fy.,while initiating actions for purchase of a store required for its production, floated the same limited tender enquiry to both established as well as un-established suppliers for the full quantity of annual requirements. The factory also did not send tender papers to certain established suppliers on the grounds of their bad performances without taking prior consent of the relevant TPC at the factory. The TPC at this Hqrs, faced some major problems in taking decision on the case and ultimately had to direct the factory to retender the case.

In this connection, attention of the General Managers is invited to para 2.1 subpara (X) and (XI) of this office circular under reference, wherein the factories had been directed to

(a) Select the established suppliers, to whom the LTE should be floated, in consultation with the TPC-I members at the factory; and

(b) To float tender enquiry for 80% of the total requirement to the established suppliers only and to float 20% of the requirements to un-established suppliers only, for development of new sources.

The General Managers are directed to strictly adhere to the guidelines circulated by this office while taking procurement actions. Also, reasons for ignoring any established supplier must be recorded in writings.

Please acknowledge receipt.

Sd/-

(P.K.Bhowmick)Joint Director/MM

For Director General Ordnance Factories.

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Annexure-44OFB LETTER NO. 14/4/LP/MM(P&C) DATED 2.1.2002.

14/4/LP/MM(P&C)GOVERNMENT OF INDIAMINISTRY OF DEFENCE

ORDNANCE FACTORY BOARDAYUDH BHAWAN

10A, Auckland Road, Calcutta-700001Dated the 2nd January 2002.

To,The Sr. eneral Manager/ General Managers(All Factories)

Sub: Floating of Tender Enquiries and Procurement of ‘A’ Category Items. Ref: i) OFB Letter No. 10/6/MM dated 8.10.82. ii) OFB Letter No. 513/Exclusive/MM dated 27.6.85. iii) OFB Letter No. 14/4/LP/MM dated 27.12.90.

It is noticed that a number of Ordnance Factories are not following the directives issued from time to time for purchase of ‘A’ Category Items, as mentioned in the letters under reference. These uidelines are again enclosed for strict compliance. Factories are enjoined to follow the same. Certain clarifications are indicated below:-

(i) Tender Enquiry may be floated for Direct Materials to Manufacturers, Assemblers, Converters, Sole Selling Agents, Authorised Agents/ Distributors of Indian Manufacturers, Stockist of Indigenous Stores of natural products such as Timber (a Certificate from State Forest Department is needed). Foreign Manufacturers and their accredited Agents in India, Stockists of Imported stores, suppliers of imported stores to these items. The firm such as M/s MMTC, M/s Rosobob., Moscow, M/s Naschem, South Africa, M/s Somchem, South Africa, M/s Kintex, Bulgeria, M/s BBT, Poland fall in this category.

(ii) Selection of Vendors at Factory Level for Limited Tender Enquiries will be decided by the relevant TPC consisting of Chairman of the TPC, Materials Manager/ Provisioning Officer and Local Finance/Accounts Officer. Where the value of the purchase is beyond financial powers of the General Manager, i.e. falling under M of D’s/ OFB’s Powers, the recommendation of the TPCs along with Source Approval Sheet should be forwarded to the concerned Section in MM Group of OFB along with all the relevant papers of the case in proper format i.e.

(a) SHIS duly vetted by LAO. (b) Source Approval Sheet. (c ) The offers received from various firms. (d) Ranking Statement. (e) Data Sheet and (f) Proceedings of the Factory/TPC Minutes.

For the Limited Tender Enquiries, minimum number of sources should be six and where the number of sources are less than six, specific reasons should be recorded in the Source Approval Sheet by the relevant TPC.

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(iii) Where the number of sources are less than six, an Additional Source Development Tender Enquiry for 20% of the Annual requirement can be covered by floating Open Tender Enquiry/ Global Tender Enquiry (for imported items).

(iv) Limited Tender Enquiry should not be sent to Established Sources as well as New Sources simultaneously. Such an action creates complications in decision making after opening of the Tender Enquiry. Supply Order in respect of Limited Tender Enquiries and Open Tender Enquiries for developmental purpose should be placed separately.

(v) Risk Purchase Clause should be deleted in respect of Development Orders. But in such cases, Security Deposit should be taken.

(vi) In all cases where purchase is under M of D’s/ OFB’s Powers, no repeat no negotiation will be done in Factory Level unless specifically authorized by M of D/ OFB.

This issue with the approval of Member/P&MM &M&C.

Kindly acknowledge receipt.

Sd/-(A.K.GOHLIYA)

DDG/MM(G)FOR DIRECTOR GENERAL ORDNANCE FACTORIES.

Copy to:-10. Chairman/OFB.11. All Members/ Addl DGOFs.12. All DDGs.13. All Directors.14. Controller of Finance (D)15. Controller of Finance (M)16. Principal Director of Staff college.

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Annexure: 45No. 01/GENL/SP/3

GOVERNMENT OF INDIAMINISTRY OF DEFENCE

ORDNANCE FACTORY BOARD10A, AUCKLAND ROAD

CALCUTTA, THE 8TH JUNE, 1990.

To The General Manager, ALL FACTORIES.

(Personal attention of General Manager)

Sub :- Procurement of important spares - F.E. release.----

After examining several cases pertaining to procurement of imported spares for different Ordnance Factories, it is seen that there is substantial delay involved between receipt off demands at OFB and issue of sanction to Ordnance Factory for placement of Supply Order by Factory and also placement of Indent on DGSW, London/Washington by OFB. Such delays and uncertainty in the procurement have two adverse. Efforts viz. there are repeated increases in the quotation by the firms and because of the uncertainty involved the factories have tendency to import large quantities of spares and accessories even though these are not required to be utilised within 2-3 years. Such delays are therefore required to be avoided and the entire procedure of imported spares procurement is required to be streamlined so that not more than 3-4 months time is taken between raising of the demand and corresponding issue of sanction.2. In order to achieve this objective, the reasons for the delays as above were analysed and some of the major reasons are recorded below :-

a) For importation of spares the factories are required to raise a demand, get the same duly vetted by LAO and send the demand along with Import Proforma-III to OFB. The demand is required to be backed up by latest budgetary quotation and certificates such as propriety articles certificate, certificate from Technical Committee regarding non-availability of indigenous source etc. It is our experience that sometimes the demands are sent without vetting by LAO orr there is substantial time gap between raising of the demand and its vetting by LAO.

b) The demand is either incomplete or the accompanied documents are incomplete. This leads to queries being raised by OFB involving loss of time.

c) The check list (importation Proforma-III) calls for certain specific information. It is however seen that either the check list is not sometimes duly filled or filled incorrectly which necessitate repeated queries to the factory and thereby loss of time.

d) The more important reason for the delay appears to be either non-availability of the

firm's latest quotation or the available validity of the quotation is too short. Before raising the demand the factories normally invited quotations

e) from the firms which may not be immediately acted upon after receipt. It has been observed in some cases that quotation as old as 2 years were sent with the demand.. As the, quoted price is the main component for working out the quantum of FE to be released, processing of old quotation involves going through the same process of FE

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release and noting which in turn may lead to further loss of existing validity of the revised quotation. We thus get into a vicious

f) circle of requirement of additional FE and loss of validity of quotation.g) In view of the uncertainity of the whole process there is a tendency to demand much

larger quantities of spares than required. To justify such larger demand the life of the spares is estimated far less than the actual life. This leads to the queries and once again delays.

h) It is seen that queries raised are not promptly answered by the factories and in some extreme cases it has taken several months for the factory to answer some minor queries. The process of FE release is thus stalled leading to snowballing delays.

i) In case of purchase from UK, clearance from M of D is required. It is seen that necessary information for obtaining such clearance is not available or the time available to obtain the clearance is too short and by the time the clearance is obtained the validity of the quotation is over.

j) The spares are generally required to be procured directly from the suppliers of the machine as invariably the spares are of a proprietory nature. These spares are to be utilised directly by the factory and no after sales service is required to be given by the Indian agent. In case any agency commission etc. is included in the quotation by the supplier, this issue is required to be sorted out before the demand is placed. Wherever the supplier insist on agency commission the cases are required to be referred to M of D for their clearance and this involves delays and loss of validity of quotation etc.

k) OFB had directed that the requirement of sparesImported. It is seen that in some cases the Technical Committee's reports are not available or such reports are given in a ritualistic fashion without indicating efforts made for indigenisation and highlighting the need for importation.

a) For air lifting of certain spares the requirement is projected much later and sometimes without giving necessary justification for sir lifting and also without send the proforma for air lifting duly filled up. As air transport charges are treated as expenditure in FE, this expenditure is once again required to be noted and released as FE expenditure. The delay in such release may also lead to expiry of date of validity of quotation with further complications and delays.

3 As mentioned above it is now required to streamline the process and eliminatethe delays so that we are able to release FE/issue of necessary sanction etc within the validity of the first quotation itself. In order to do so a revised check list (Import proforma 01/GENL/90/SP3 ) has been prepared and is enclosed herewith. Henceforth information as per this checklist should invariably be sent with the demand for spares involving FE of more than Rs. 50000/-. However, for lesser value demands, information may be given as per existing form.

4 The processing at OFB will be done with the following quidelines :-

i) Immediately after the receipt of demand the same will be examined to see whether, (I) the demand is vetted, (ii) the demand is accompanied by the revised check list duly filled in, (iii) the demand is complete with all the necessary certificates and the most important, (iv) for direct procurement whether the firm's quotation is valid for a period at least three months in case of non UK firms and four months in case of UK firms. In case any of the requirement as above is not met the demand will be returned to the factory unaccepted.

ii) Accepted demand will be given a computer serial number for monitoring the progress. All correspondence should indicate this computer number allotted by OFB.

iii) In view of the FE constraints it is expected that the factories will be projecting only minimum essential requirements. If it is seen that the requirements are very large or the life mentioned is abnormally low and expenditure is not

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commensurate with the new life for machine, queries will be raised which the factories should answer with a week's time.

iv) As no service is rendered by an Indian agent in most of the cases it should be verified that no payment of agency commission is involved. The factories their own interest should try to persuade the machine suppliers to delete such a provision if indicated by them in the quotation where the suppliers insist on the payment of the commission such instances should be pointed out. DDG/ENGG. as well as DDG/SP so that in future decision regarding machine purchase from such supplier could be reviewed.

v) In case FE is not released within two months of the receipt of demand at OFB and there is no query raised by OFB, such cases should be reported by Telex to DDG/SP so that delay at OFB if any in processing the case could be monitored.

vi) Wherever it is seen that validity of the quotation is likely to be lost, the factory should take action in time and make a reference to the supplier for suitable extension in validity well before existing validity expires. Large scale and unjustified price increases within a short span of time should be questioned so that firms do not take for granted that whatever they demand will be given to them.

5 It is requested that necessary instructions to be passed on to the concerned officers and staff

dealing with importation off spares and accessories so that delays taking place could be avoided both at factory as well as at OFB. The quick clearance of FE will not only ensure placement of orders within the validity of the quotation but this will give confidence to the GMs that they need not jack up the demand to cover the period of delay or uncertainty. This will have a positive effect on the inventory holding of the factory also.

Kindly acknowledge receipt.

Sd/-( A. V. DHEKNE ) DDG/SP

FOR DIRECTOR GENERAL, ORDNANCE FACTORIES.

Copy to :-

Member/P&MMAll DDGsController of Finance.Dir/SPJD/SP-3JD/EM-I & IIJD/SP-II

93

Annexure to OFB letter no. 01/GENL/SP/3 dated 8 th June 1990 CHECK LIST FOR IMPORT OF SPARES VALUING MORE THAN Rs. 50,000/-

1. 0 DATA Computer Code No. (to be given by OFB)A) DEMAND -a) Demand No. & date :b) LAO Vetting reference and date :c) Firm’s name and currency involved :d) Exchange rate taken for calculation :e) (i) Total E.E. in foreign currency : (ii) Total F.E. (excluding Insurance & freight in Rupees : (iii) Insurance (if any) & freight in Rs. : Total of (ii) & (iii) in Rs. :B) MACHINE/Sa) Contract No/A.T.No. against which : Machine was purchased.b) Nomenclature of the Machine for which : spares are requiredc) Model No. :d) Year of Supply :e) Year of Commissioning :f) Number of similar Machine in the factory :g) Original Value (i) In Foreign Currency : (ii) In Rupees :h) Present Book Value in Rupees :i) Residual life of the Machine in Years :j) Expected life of the Machine after use of the : proposed spares as assessed by the Technical Committee in years

C) SPARES

a) The reference of past contracts for imported : Spares for the Machine.b) Value of spares imported foe each of the last : two contracts for the same Machine.c) Nos. of each of the items to be used at a time : for one Machine.d) Life of each of the items proposed for the : procurement.e) Average life obtained of each of these items : No. of years Machine in use : Nos of the items used so far including those : Originally assembled with Machine. f) Nature of the items :

94

Propriotory/ Non-Propriotory :g) Approx. gross weight of the total consignment : (This information is required even when airlifting is not involved ).2.0 STATISTICALa) No. of demands and Value of demands for the imported spares in the last three years including current year :Year No. of Demands Total F.E.noted in Lakhs of Rs. (no decimal reqd) for the spares.------ -------------------- ----------------------------------------88-8989-9090-91(b) (i) Budgetary provision for F.E.commitment : noting for the current year in Rupees. (ii) Budgetary provision for F.E. cash outgo : in Rupees for the current year.

3.0 GENERALa) Has the technical committee reconded : importation?b) was any effort made to indigenize the item? : If so, give details.c) Do you propose direct ordering? If so the : demand should be accompanied with PAC and certificate that no commission/ payment to Indian Agent is involved.d) Please answer to any of the following. If yes, Then please bring the position to the knowledge of DDG/Engg and DDG/MM.

(i) Are the charges for any item un0reasonably high? Yes/No.(ii) Does the firm give insufficient validity of quotation and asks for repeated increase in price ? Yes/No.(iii) Is the quality of spares poor requiring replacement? Yes/No.(iv) Is the firm insisting for payment of commission to Indian Agents for supply of spares where no service Is rendered by the agent? Yes/No.

e) In case machine was manufactured under collaboration in India or supplied under joint working agreement, have you taken up with the Indian supplier for the supply of these spares? If not, reason thereof.

4.0 CERTIFICATEPlease enclose the following and tick ( ) mark the certificates which you have enclosed.(1) Approval of the GM/Addl GM (not required if demand is : signed by GM/AddlGM) (2) LAO’s vetting clearance (not required if vetting is done on : demand sheet).(3) Propriatory Article Certificate (in case item is of Propriatory: in nature).(4) Reasonability of cost (to be signed by an officer not below : the rank of DGM.(5) Certificate from Technical Committee on added life of machine :(6) Certificate from Technical Committee with regard to non availability in India of the spares proposed for importation :(7) Certificate in prescribed form in case dispatch by Air required :

95

(8) Certificate that the machine for which spares are required is not : condemned and no replacement action has been taken.(9) Copy of supplier’s quotation valid for 3 months (4months in case : of U.K. based firms) If direct order is to be placed.(10) Certificate that no Indian Agent is associated and no payment to : an Indian Agent is involved. (This is required for all direct orders)

(Signature with name and designation)Annexure: 46

FAXFROM: MUNITIONS CALCUTTA.TO : ORDVAR, VARANGAON

388/MM/D/99-2000 DATED 08.5.2000(.) SHRI S.D.DIMRI AGM FROM B.K.RAO DDG/MM(R ) (.) THIS HAS REFERENCE TO YOUR LETTER NO. 0606/D/SC/P/MCO DATED 03.05.2000 REGARDING CERTAIN CLARIFICATIONS ON SALE OF NF-SCRAP TO SSI AND EXPORT UNITS (.) POINT-WISE CLARIFICATIONS ARE OFFERED BELOW (.)

1.IT IS EXPRESSED IN OFV LETTER THAT THE HIGHEST RATES RECEIVED UNDER EXPORTQUOTA AND OPEN QUOTA ARE LIKELY TO BE DIFFERENT(.) AT THE OUTSET IT IS CLARIFIED THAT THERE IS NO QUESTION OF DEMARCATING RATES RECEIVED FOR VARIOUS QUOTAS LIKE THE HIGHEST RATE RECEIVED IN EXPORT QUOTA, AND THE HIGHEST RATE RECEIVED IN OPEN QUOTA (.) WHEN A TENDER IS OPENED THERE WILL BE ONLY ONE HIGHEST RATE AMONG ALL THE BIDS RECEIVED AND THAT FORMS THE BASIS, FOR ALLOWING TO A MAXIMUM EXTENT OF 10% CONCESSION TO SSI UNITS AND EXPOET UNITS (.) THE QUESTION OF TAKING HIGHEST RATES GROUP-WISE DOES NOT ARISE (.)

2. AS REGARDS DISTRIBUTION OF 30% QUOTA AMONG SSI UNITS THE VARIOUS STEPS INVOLVED ARE LISTED BELOW:

(A) QUOTA FIXED IS 30% OF THE TENDERQUANTITY (.)(B) THE QUANTITY FIXED FOR EACH SSI UNIT CANNOT EXCEED UNDER ANY CIRCUMSTANCES BEYOND 5MT (.)[C] ALL THE SSI UNITS WHOSE RATES ARE WITHIN 10% MARGIN OF THE HIGHEST RATE RECEIVED ARE ELIGIBLE FOR

ALLOTMENT AGAINST 30% SSI QUOTA (.) HOWEVER, THE ACTUAL DISTRIBUTION IS GUIDED BY A JUDICIOUS BALANCE OF FULFILLING THE CONDITIONS LAID-DOWN AND SAFEGUARDING THE GOVT.’S INTEREST (.)

SUPPOSE ADVERTISEMENT IS GIVEN FOR DISPOSAL OF 100 MT OF A PARTICULAR NF SCRAP (.) THEREFORE THE MAXIMUM QUANTITY THAT CAN BE DISTRIBUTED AMONG SSI UNITS IS 30 MT (.) LET US TAKE THE MAXIMUM RATE RECEIVED IS RS. 100/KG (.) SSI UNITS WHO HAVE QUOTED RS. 90/KG AND ABOVE WILL BECOME ELIGIBLE WITHIN 10% MARGIN (.) THOSE WHO QUOTED LESS THAN RS. 90 ARE NOT ELIGIBLE AT ALL (.) SUPPOSE THERE ARE ONLY SIX OR LESS THAN SIX (.) SSI UNITS ELIGIBLE, THEN THEY WILL GET MAXIMUM QUANTITY OF 5 MT EACH (.) IF THERE ARE SIX PEOPLE (,) TOTAL QUOTA OF 30 MT WILL BE EXHAUSTED BUT IF IT IS LESS THAN SIX, TOTAL QUOTA WILL NOT BE EXHAUSTED AND THAT WILL BE CLUBBED WITH THE GENEAL QUOTA (.) IN CASE THERE ARE MORE THAN SIX PEOPLE ELIGIBLE SAY 10, IN THAT CASE 30 MT ARE REQUIRED TO BE DISTRIBUTED IN A MORE PROFITABLE MANNER TO THE GOVERNMENT (.) 1 MT EACH TO THE LOWER FIVE PEOPLE AND THEN 5 MT EACH TO THE REMAINING HIGHER FIVE PEOPLE WILL BE THE DISTRIBUTION IN THE INTEREST OF THE GOVERNMENT (.) IN CASE THERE ARE 30 PEOPLE ELIGIBLE (.) THEY WILL GET 1 MT EACH (.) IF THERE ARE 20 PEOPLE

96

THEN THE HIGHEST TWO PEOPLE WILL BE GIVEN 5 MT EACH (,) THE THIRD MAN WILL BE GIVEN 3 MT AND THE BALANCE 17 MT WILL BE DISTRIBUTED 1 MT EACH (.)

MOST IMPORTANT POINT (,) SSI UNITS GETTING 10% CONCESSION ON THE HIGHEST BID RECEIVED DOES NOT MEAN EVERY SSI UNIT WILL BE GIVEN @ RS/ 90/KG (.) SUPPOSE THE RATES RECEIVED FROM SSI UNITS ARE RS. 99, RS. 98, RS. 94, RS. 93, RS. 91, RS. 90, RS. 89 ETC. WHOSOEVER QUOTED LESS THAN RS. 90 ARE NOT ELIGIBLE AND THOSE WHO QUOTED RS. 90 AND ABOVE ARE ALL ELIGIBLE AND WILL BE ALLOTED AT THE EXACT RATES QUOTED BY THEM (.) THAT IS THE UNIT QUOTED @ RS. 99 WILL BE ALLOTTED @ RS. 93 AND THE UNITS QUOTED @ RS. 90 WILL BE ALLOTTED @ RS. 90 AND NOT THAT ALL THE UNITS QUOTED @ RS. 90 AND ABOVE WILL BE UNIFORMALLY ISSUED @ RS. 90.

3. MAXIMUM QUANTITY THAT CAN BE DISTRIBUTED AMONST EXPORT UNIS IS ALSO 30% (.) WITHIN THIS 30% QUOTA EXPORT UNITS WILL GET TO THE EXTENT OF 50% OF THEIR ACTUAL CONSUMPTION IN THE PREVIOUS YEAR UTILISED FOR EXPOET PURPOSES (.) IF THEY HAPPEN TO BE SSI UNITS THAN THEY WILL BE ELIGIBLE FOR GETTING PRICE PREFERENCE (,) THAT DOES NOT MEAN DEDUCTING 10% FROM THE HIGHEST RATE (.) THE RATE WHATEVER THEY QUOTE ABOVE 90% ONLY WILL BE APPLICABLE (.) OTHER EXPORT UNITS WHICH ARE NOT SSI REGISTERED WILL BE GIVEN ONLY AT THE HIGHEST RATE RECEIVED IN THE TENDER (.)

Sd/- (B.K. RAO) DDG/MM(R)

FOR DIRECTOR GENERAL, ORDNANCE FACTORIES

97

Annexure: 47TIME FRAME FOR PURCHASE CASE

[SINGLE COMMERCIAL BIDS]

WORKING OUT & VETTING OF REQUIREMENT (To be taken at the factories)1. Working out of Requirement as per estimate & Target 1 Week2. Preparation and Vetting of SHIS 1 Week3. Vendor Selection TPC and preparation of TE. 1 Week4. Approval of TPC members and floating of LTE/STE 1 Week5. Notification of Tender through

DAVP/Advertisement(OTE)3 Weeks(OTE/GTE)

PROCUREMENT ACTION (to be taken at factories) for all cases1 Time allowed for submission of offers in a single bid

system (Commercial bid only) after issuing Tender forms.

Min 3 Weeks (LTE) Min 4 Weeks (OTE)Min 6 Weeks (GTE)

2. Opening of Commercial offers, preparation of CST, Tech Vetting, etc.,

1 Week

3. Proposal for Procurement / Scheduling of TPC with CFA approval.

1 Week

4 Brief for TPC, notice for TPC and TPC meetings 1 Week

5. TPC minutes and signature. 1 Week (3 Weeks in cases of Counter

offer/negotiation)6. IFA concurrence and CFA Approval of Purchase Proposal

(for cases within GM’s Power)1Week

7. Sending proposal to OFB along with relevant papers (for cases within OFB/MOD powers)

1 Week

PROCUREMENT ACTION (to be taken at OFB) for OFB/MOD cases

8. Preparation & distribution of brief at OFB, holding of TPC/OFB and issuing approval letter.

3 Weeks (5 Weeks in cases of Counter offer/negotiation)

9. Sending proposal to M of D for cases beyond OFB powers.

1 Week

PROCUREMENT ACTION (to be taken at MOD) for MOD cases.

10. Approval of MOD and issue of sanction letter. (for cases beyond OFB powers)

4 Weeks

PROCUREMENT ACTION (to be taken at factories) for all cases

11. Preparation of SO and Despatch of SO 1 Week

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i) Cases within GM’s Power:Total ii) Cases within OFB Power : iii) Cases within MOD Power:

LTE cases OTE cases GTE cases13-15weeks17-19weeks21-23weeks

17-19weeks19-21weeks24-26weeks

19-21weeks21-23weeks26-28weeks

NOTE: cases falling within financial powers of MOD are to be sent through OFB. In all such cases negotiation/ counter offer, if required, are to be done by OFB.

99

Annexure: 48TIME FRAME FOR ACQUISITION

[TWO BIDS]

WORKING OUT & VETTING OF REQUIREMENT (To be taken at the factories)1. Working out of Requirement as per estimate &

Target1 Week

2. Preparation and Vetting of SHIS 1 Week3. Vendor Selection TPC and preparation of TE. 1 Week4. Approval of TPC members and floating of LTE/STE 1 Week5. Notification of Tender through

DAVP/Advertisement(OTE)3 Weeks(OTE/GTE)

PROCUREMENT ACTION(to be taken at factories)1 Time allowed for submission of offers in a Two bid

system (Commercial bid and tech bid) Min 3 Weeks (LTE) Min 4 Weeks (OTE) Min 6 Weeks (GTE)

2. Opening of Tech Bids and Technical Evaluation by TEC. (to be done at the factory)

3 Weeks

3. Opening of Commercial offers, preparation of CST, Tech Vetting, etc.,

1 Weeks

4. Proposal for Procurement / Scheduling of TPC with CFA approval.

1 Weeks

5. Brief for TPC, notice for TPC and TPC meetings 1 Weeks

6. TPC minutes and signature. 1 Week (3 Weeks in cases of Counter

offer/negotiation)7. IFA concurrence and CFA Approval of Purchase

Proposal (for cases within GM’s Power)1Week

8. Sending proposal to OFB along with relevant papers (for cases within OFB/MOD powers)

1 Week

PROCUREMENT ACTION (to be taken at OFB) for OFB/MOD cases

9. Preparation & distribution of brief at OFB, holding of TPC/OFB and issuing approval letter.

3 Weeks (5 Weeks in cases of Counter

offer/negotiation)10. Sending proposal to M of D for cases beyond OFB

powers.1 Week

PROCUREMENT ACTION (to be taken at MOD) for MOD cases.

11. Approval of MOD and issue of sanction letter. (for cases beyond OFB powers)

4 Weeks

PROCUREMENT ACTION (to be taken at factories) for all cases

12. Preparation of SO and Despatch of SO 1 Week i) Cases within

GM’sPower:

Total ii) Cases within OFB Power: iii) Cases within MODPower:

LTE cases OTE cases GTE cases

16 – 18 Weeks.19 - 21weeks.24-26weeks.

20-22 Weeks.22-24weeks.27-29weeks.

22-24 week

24-26week29-31week

100

NOTE: cases falling within financial powers of MOD are to be sent through OFB. In all such cases negotiation/ counter offer, if required, are to be done by OFB.

101

Annexure-49No.14/4/LP/POLICY/MM/P&C

Government of India, Ministry of Defence,

Ordnance Factory Board, 10-A, S.K.Bose Road,

Kolkata-700001. Dated 30.5.2005.

To, The Sr. General Manager/ General Manager

Sub: Disposal of stores.

This office has been receiving proposals from different Ordnance Factories for disposal of stores as scrap as they could not be disposed off due to one or more of the following reasons:

1. The condition of the stores has deteriorated to such an extent that it can not be used for the purpose it is intended for.

2. The rate received against an attempt of disposing it through auction/ tender was much lower compared to reserve/ guiding price fixed earlier.

3. There is no bidder for the item when offered for disposal by auction/ against tender.

In the above cases the factories are requesting to downgrade the items so that they can be disposed off as scrap or waste products.

In this connection it may be clarified that in the whole of disposal procedure there is no scope of downgrading an item. It is only the reserve/ guiding price that can be fixed/ re-fixed after an attempt for disposal of the item is proved unsuccessful. The following should be kept in mind while fixing reserve/ guiding price.

Generally the reserve/ guiding price are fixed on the basis of book value, the actual condition and the likely market rate of the stores in similar condition. In case of items which may be for a specific task/ purpose may have no marketable value in as such condition except as a scrap. In such cases the reserve price will have to take above into consideration and the “book value” will not be “only” factor to fix reserve price. A rate obtained after open tender/ advertised enquiry, is fair indicative of market price and has to be taken into consideration while fixing reserve price in subsequent enquiries.

The entire process of disposal is to get rid of the inventory at a fair cost related to market cost and therefore fixing illogical and unreasonable high reserve price, where it finds no buyer, will defeat the very purpose of it. The committee fixing reserve price should be suitably advised so that a realistic and logical “reserve price” is fixed which will facilitate disposal at a fair market price. Fixing unrealistic very high reserve price by the reserve price fixing committee will only indicate that the committee does not have intention to dispose off the stores in question.

The cases falling under decision taking powers/ financial powers of GM will have to be necessarily dealt by GMs themselves and decision taken after following laid down procedure. Cases beyond GM’s power will need reference to OFB in usual manner.

For the benefit of General Managers the powers for declaration of stores as surplus/obsolete etc., disposal of stores and acceptance of lower bids than the reserve/ guiding price is enclosed for better appreciation. General Managers are requested to take appropriate action at their levels in each of these stages of disposal so that the disposal of unwanted stock are cleared so as to reduce inventory carrying and inventory maintenance cost besides deterioration.

(S.KOLAY)Encl: Annexure ‘A’, ‘B’, ‘C’. DDG/ MM (K) For D.G.O.F.

102

Annexure-‘A’DECLARATION OF DISPOSABLE STORES

Nature of Power Authority Extent to which delegated

Remarks Whether Finance is to be consulted

(a) Serviceable Stores: (i) Drums,

Containers and Packages.

(ii) Serviceable Stores other than Drums, Containers and Packages.

GM

GM

DDG/MM

OFB

Full Powers.

Rs. 1.5 Lakhs in each case.Rs. 3 Lakhs in each case.As per GFR authority competent to purchase a store shall be competent to declare the stores as obsolete/ surplus/ unserviceable.

Nil

Nil

Nil

Nil

Yes.

Yes.

Yes.

Yes.

(b) Unserviceable Stores:

JtGM/DGM

GM

OFB

Up to Rs. 2 Lakhs in each case.Rs. 5 Lakhs in each case.As per GFR Authority competent to purchase a store shall be competent to declare the stores as obsolete/ surplus / unserviceable

Nil

Nil

Nil

Yes

Yes.

Yes.

(c ) Scrap and swarf. JtGM/DGM

GM

Rs. 5 Lakhs in each case.Full Powers.

Nil

Nil

Yes.

Yes.

(d) Unserviceable Plant and Machinery beyond economic repair.

GM Full Powers. Before declaring any item of P&M as unserviceable and surplus all avenues for its Cost Effective reconditioning have to be explored.

Yes.

103

Annexure-‘B’DISPOSAL OF STORES

Nature of Power Authority Extent to which delegated

Remarks Whether Finance is to be consulted

(a) Serviceable Stores: (i) Drums,

Containers and Packages.

(ii) Serviceable Stores other than Drums, Containers and Packages.

GM

GM

DDG/MM

OFB

Full Powers.

Rs. 1.5 Lakhs in each case.

Rs. 3 Lakhs in each case.

Full Powers.

Nil

Without clearance by Technical Team.Subject to clearance by Technical Team.-do-

Yes.

Yes.

Yes.

Yes.

(b) Unserviceable Stores:

JtGM/DGM

GM

OFB

Up to Rs. 2 Lakhs in each case.Rs. 5 Lakhs in each case.Full Powers.

Nil

Nil

Nil

Yes

Yes.

Yes.

(c ) Scrap and swarf. JtGM/DGM

GM

Rs. 5 Lakhs in each case.Full Powers.

Nil

Nil

Yes.

Yes.

(d) Unserviceable Plant and Machinery beyond economic repair.

DDG/ Engg

GM

Up to Rs. 1 Lakh in each case.*Rs. 40,000/- in each case. (Book Value)

Nil Yes.

(e) Surplus Plant and Machinery.

OFB Rs. 10 Lakhs in each case.

Subject to condition that normal procedure of disposal is resorted to.

Yes.

i) The disposal shall be affected by Public Auction/Open Tender Limited Tender may be resorted to with proper justification with the prior approval of OFB/Concerned Member.

ii) Rate/Running Contract may also be concluded with the prior approval of of OFB /Concerned Member. iii) Detailed procedural instruction in regard to declaration of surplus and

disposal are contained in P&MM Divn. Circular No. 212/2/MM dt. 15.6.81

104

Annexure-‘C’

AUTHORITY COMPETENT TO ACCEPT BIDS BELOW RESERVE PRICE

Type of Store Authority Extent to which Power is delegated

Remarks

(i) Surplus Serviceable Stores up to Rs. 50,000/-

GM Full Powers to accept lower bids or to order retender.Can delegate to Sales Supervising Officer to accept bids up to 30% below reserve price.

(ii) Unserviceable Stores and Vehicles.

GM

OFB

Up to 50% below the reserve price.Can delegate to Sales Supervising Officer to accept bids up to 30% below reserve price.Bid beyond 50% below the guiding price case to be referred to OFB.

(iii) Waste products, scrap.

GM

MEMBER/OFB

Up to 20% below the reserve price.Can delegate to Sales Supervising Officer to accept bids up to 10% below reserve price.

Between 20 and 40% below the guiding price.

GM to recommend cases to OFB.

105

Annexure-50 No. 213/CE/w004-05/F/B

Government of IndiaMinistry of Defence

Ordnance Factory Board10A, S.K. Bose Road,

Kolkata-700 001. Dated : 15-04-2004

ToThe Addl. DG/AV, Addl.DG/OEF,The Principal Director/OFSCThe Sr. General Managers/General Managers.

Sub :- Provisional payment of charged expenditure-revised procedure- regarding.Ref :- This office circular of even No. dated 04-03-2004.

Please refer to the above circular in which the direction of M of D regarding payment of Charged Expenditure was conveyed to all factories. It may be ensured that under no circumstances the provisional payments in respect of decretal amount awarded by Counts/CATs should be released without specific allotment of funds under charged expenditure to make payments. As soon as a copy of the judgement of Court/CAT is received, immediate action may be initiated to get allotment of funds under the head Charged Expenditure. Such proposal should be sent to Finance/Budget section of this office through the concerned Administrative/Operating sections along with

A copy of the Judgement/Award on the basis of which payment has been made. Precise amount needed to satisfy the Judgement/Award. In case the amount could not be

precisely calculated, tentative amount indicating the variable parameters should be intimated for allotment of funds.

It is noted that in some cases the factories are forwarding the cases to this office after a considerable lapse of time. You are requested to ensure that immediately after the allotment of funds by this office the payment may be released on a provisional basis and the case submitted to this office for ex-post facto sanction along with the following documents :

a) A copy of self – contained statement of case.b) A copy of account statement/calculation should duly vetted by LAO.c) Details of payment. Amount for which M of D sanction has to be obtained. Date of payment. Code Head of booking. Financial year in which the payment has been made.d) Other relevant documents if any. To ensure sufficient allotment of funds for such payments you are requested to anticipate

the requirement of funds under charged expenditure based on the pending Count/Arbitration cases and project your requirements for the next year along with the FE, Budget Estimate submitted during the previous year as well as periodical projections in the current year(PR/PRE/RE/MA).

Sd/- A.N. SAXENACONTROLLER OF FINANCE

For D. G. O. F.Copy to :-

1. PPS to Chairman/OFB2. Member/OFB3. PCofA(Fys), Kol. With request to bring the above instruction to the notice of all LAOs.4. All DDGs. As soon as the proposal for allotment of funds is received from the factories, the

case may be forwarded to this section along with the approval of the competent authority regarding implementation of such award/judgement.

Annexure-51

106

INCOTERMS – 20001. In INCOTERMS 2000, the delivery and transportation of goods are grouped

into four categories as under: -

(a) “E” – Terms - Implies Ex-works, where under, the seller only makes the goods available to the buyer at the seller’s own premises. The responsibility of providing the carrier is that of the buyer.

(b) “F”-Terms- FCA, FAS and FOB are various clauses of “F” terms under which the seller is called upon to deliver the goods to a carrier appointed by the buyer. The responsibility of providing the carrier is that of the buyer.

(c) “C”-Terms- CFR, CIF, CPT and CIP are various clauses of “C” terms under which the seller has to contract for carriage, but without assuming the risk of loss of or damage the goods or additional costs due to events occurring after shipment and dispatch.

(d) “D”- Terms- DAF, DES, DEQ, DDU and DDP are various clauses of “D” terms under which the seller has to bear costs and risks needed to bring the goods to the placed of destination.

2. Ex-works (EXW) “Ex-Works” means that the seller delivers when he places the goods at the disposal of the buyer at the seller’s premises or another named place (i.e., works, factory, warehouse, etc.) not cleared for export and not loaded on any collecting vehicle. This term thus represents the minimum obligation for the seller, and the buyer has to bear all costs and risks involved in taking the goods from the seller’s premises.

3. However, if the parties wish the seller to be responsible for loading of the goods on departure and to bear the risks and all the costs of such loading, this should be made clear by adding explicit wording to this effect in the contract of sale. This term should not be used when the buyer cannot carry out the export formalities directly or indirectly. In such circumstances, the FCA term should be used provided the seller agrees that he will load at his cost and risk. 173

4. Free Carrier (FCA)- “Free Carrier” means that the seller delivers the goods, cleared for export, to the carrier nominated by the buyer at the named place. This terms may be used irrespective of the mode of transport, including multi-modal transport. “Carrier” means any person who, in a contract of carriage, undertakes to perform or to procure the performance of transport by rail, road, air, sea, inland waterway or by a combination of such modes. If the

buyer nominates a person other than a carrier to receive the goods, the seller is deemed to have fulfilled his obligation to deliver the goods when they are delivered to that person.

5. Free Alongside Ship(FAS)- “Free Alongside Ship” means that the seller delivers when the goods are placed alongside the vessel at the named port of shipment. This means that the buyer has to bear all costs and risks of loss of or damage to the goods from that moment. The FAS term requires the buyer to clear the goods for export. However, if parties wish the buyer to clear goods for export, this should be made clear by adding explicit wording to this effect in contract of sale. This term can only be used for sea or inland waterway transport.

6. Free on Board (FOB)- “Free on Board” means that the seller delivers when the goods pass the ship’s rail at the named port of shipment. This

107

means that the buyer has to bear all costs and risks of loss of or damage to the goods from the point. The FOB term requires the seller to clear the goods for export. This term can be used only for sea or inland waterway transport. If the parties do not intend to deliver the goods across the ship’s rail, the FCA term should be used.

7. Cost and Freight (CFR)- “Cost and Freight” means that the seller has delivered when the goods pass the ship’s rail in the port of shipment. The seller must pay the cost and freight necessary to bring the goods to the named port of destination but the risk of loss of or damage to the goods, or any additional costs due to events occurring after the time of delivery, are transferred from the seller to the buyer. The CFR term requires the seller to clear the goods for export. This term can be used only for sea and inland waterway transport. 174

8. Cost, Insurance and Freight (CIF)- “Cost, Insurance and Freight”(CIF) means that the seller delivers when the goods pass the ship’s rail in the port of shipment. The seller must pay the costs and freight necessary to bring the goods to the named port of destination. In case of CIF term, the seller also has to procure marine insurance against the buyer’s risk of loss of or damage to the goods during the carriage. Consequently, the seller contracts for insurance and pays the insurance premium. The CIF term requires the seller to clear the goods for export. This term can be used only for sea and inland waterway transport. If the parties do not intend to deliver the goods across the ship’s rail, the CIP term should be used.

9. Carriage Paid To (CPT)- “Carriage Paid to (CPT)” means that the seller delivers the goods to the carrier nominated by him but the seller must in addition pay the cost of carriage necessary to bring the goods to be named destination. This means that the buyer bears all risks and any other cost occurring after the goods have been so delivered. The CPT term requires the seller to clear the goods for export. The term may be used irrespective of the mode of transport including multi-modal transport.

10. Carriage and Insurance Paid To (CIP)- “Carriage and Insurance Paid To (CIP)” means that the seller delivers goods to the carrier nominated by him, but the seller must in addition pay cost of carriage necessary to bring goods to be named destination. This means that the buyer bears all risks and any additional cost occurring after the goods have been so delivered. However, in CIP, the seller also has to procure insurance against the buyer’s risk of loss of or damage to the goods during the carriage. Consequently, the seller contracts for insurance and pays the insurance premium.

11. The buyer should note that under the CIP term, the seller is required to obtain insurance only on minimum cover. Should the buyer wish to have the protection of greater cover, he would either need to agree as much expressly with the seller or to make his own extra insurance arrangements. “Carrier” means any person who, in a contract of carriage, undertakes to perform or to procure the performance of transport by rail, road, air sea, inland waterway or by a combination of such modes. If subsequent carriers are used for the carriage to the agreed destination, the risk passes when the goods have been delivered to the first carrier. The CIP requires the seller to clear the goods for export. This term may be

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used irrespective of the mode of transport including multi-modal transport. 175

12. Delivered at Frontier (DAF)- “Delivered at Frontier” means that the seller delivers when the goods are at the disposal of the buyer on the arriving means of transport not unloaded, cleared for export, but not cleared for import at the named point and place at the frontier, but before the customs border of the adjoining country. However, if the parties wish, the seller to be responsible for the unloading of goods from the arriving means of transport and bear the risks and costs of unloading, this should be made clear by adding explicit wording to this effect in the contract of sale. This term should not be used irrespective of the mode of transport when goods are to be delivered at a land frontier.

13. Delivered Ex-Ship (DES)- “Delivered Ex-Ship” means that the seller fulfils his obligation to deliver when the goods have been made available to the buyer on board the ship un-cleared for import at the named port of destination. The seller has to bear all the costs and risk involved in brining the goods to the named port of destination before discharging. If the parties wish, the seller to bear the costs and risks of discharging the goods, then the DEQ term should be used. The term can only be used only when the goods are to be delivered by sea or inland water way transport on a vessel in the port of destination.

14. Delivered Ex-Quay (Duty Paid) (DEQ)- “Delivered Ex-Quay (Duty Paid)” means that the seller fulfils his obligation to deliver when he has made the goods available to the buyer on the quay (Wharf) at the named port of destination, cleared for importation. The seller has to bear all risks and costs including duties, taxes and other charges of delivering the goods thereto. This term should not be used if the seller is unable directly or indirectly to obtain the import license. If the parties wish the buyer to clear the goods for importation and pay the duty, the words “ duty unpaid” should be used instead for “duty paid”.

15 Documents- In all cases of foreign contracts, the suppliers should forward to the purchaser copies of all documents concerning delivery and payment, by speed post, courier or other fastest means of dispatch. This should be in addition to the documents dispatched to the bank for payment through Letter of Credit. The supplier should give at least six weeks notice, with regard to the readiness of the consignment, to the purchaser and his agent. The date of bill of lading or airway bill will be considered as the actual date of delivery with reference to the stipulated date of delivery in the contract. 176.

16 Consignees’s Right of Rejection- Notwithstanding the fact that an item may have been inspected prior to dispatch, the consignee will have the right to reject it, in whole or part, if it is observed that the item supplied does not conform to the specifications or has been damaged. Such rejection will be communicated to the supplier within 90 days of the item reaching the consignee’s premise. If an item is rejected, the supplier is

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required to replace the item within a period determined by the supplier, which should not be less than 45 days, failing which he shall make financial restitution base don’t he order value. However, in all such cases the provisions contained in the International Chamber of Commerce Publication, INCOTERM 2000, including that regarding change of the right of property, as amended from time to time, will be considered as foreign contracts are governed by international laws. 177

Annexure-52

STANDARD FORM FOR INTIMATING FIRMS REGARDING REJECTION OF THEIR OFFER.

M/s ------------------------------------------------------------

Sub: Tender Enquiry No.----------------------- opened on -------. Ref: Your quotation No.------------------------- dated------------.Dear Sirs,

It is hereby informed that your above mentioned quotation could not be considered as :-

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(i) It was received late.(ii) It was not furnished with EMD as required in the Tender Enquiry.(iii) It was deficient of documents.(i) It contained inconvenient/unacceptable terms and conditions in the

tenders.(iv)Stores offered were not as per the tender enquiry specification.(v) Delivery schedule offered was not as per tender enquiry

requirements.(vi) You were not registered with DGS&D/NSIC or the the factory

indicated in the enquiry.(vii) Past performance was not meeting the required

performance level.(viii) Price quoted were not within the acceptable range.(ix)Due to revision of your original offer after tender opening.(x) Any other reason (to be specified as applicable).

(* Tick mark whichever is applicable)

Yours faithfully,

(-----------------------) For General Manager.

Annexure-53

FORM-A To, M/s………………….

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Sub: Award dated…………..made by ………….the Arbitrator in regard to dispute arising out of Supply Order No…………..dated ………… and Arbitration case no………..

Dear Sirs,

With reference to the award mentioned above I hereby on behalf of ---------------------------------------------------------(name of the purchaser) call upon you to remit the awarded amount by demand draft in favour of (DGOF/Chairman, OFB/GM) on the RBI or SBI within 15 days of the receipt hereof by you. Please note that in the event of your failure to do so the Govt. shall take steps to cause the award to be filed in the Court and obtain a decree in terms thereof, for the cause and consequences of which you will be responsible.

Yours faithfully

Sd/-For and on behalf of President of India.

Annexure-54FORM-B

To, M/s…………………………

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Sub: Award dated ………… made by………….arbitrator in regard to dispute arising out of Supply Order No………….. dated …… and arbitration case no………….

Dear Sirs,

With reference to the award mentioned above you are requested to intimate by ---------------------------------------(the date to be specified) that you agree to accept the award and remit the sum awarded in full and final settlement of all your claims constituting the subject matter of the reference to arbitration in the above cited case.

Yours faithfully,

Sd/-For and on behalf of President of India.

Annexure-55No. 108/TIR/TS/QCS

Govt of IndiaMinistry of Defence

Ordnance Factory Board10 A, S.K.Bose Road

Kolkata-700001Dated 23rd June 2005.

To,

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Sr. General Manager/ General ManagerAll Fys

Sub: i) Transfer of Inspection responsibility for input material including raw material from DGQA to DGOF.

ii) transfer of Vendor development, capacity verification & vendor registration responsibility from DGQA to DGOF.

Ref: i) MOD Order No. 16(2)/2004/D(QA) dt. 31.03.05 (enclosed) ii) MOD Order No. 16(2)/04/D(QA) dt. 15.06.05 (enclosed)

M of D has issued orders for transfer of responsibilities of input material inspection, capacity verification and vendor registration etc. from DGQA to Ordnance Factories vide Order quoted under reference (i) above. 02 A meeting was held with DGQA on 3.5.2..5 at Ordnance Factory Board to ensure smooth

transfer of these responsibilities from DGQA to Ordnance Factories. However, on few issues there were disagreements in interpreting the M of D Orders. Accordingly the matter was referred to M of D for clarifications.

03 M of D has provided clarifications vide Order quoted under reference (ii) above.

04 The Standard Operating Procedures (S.O.P) for input material inspection is enclosed herewith for compliance. It may please be noted that as per Government Order Sample rooms maintained by DGQA shall be wound up. Therefore, Ordnance Factories need to create and maintain Sample Rooms as mentioned in S.O.P. Further, Ordnance Factories should make arrangements to create Standard Cell for actions mentioned in S.O.P.

05 The Standard operating Procedure for Capacity Verification and Vendor registration shall be forwarded shortly.

06 The Orders are to be implemented with immediate effect. Existing supply orders wherever required may be amended suitably. Kindly confirm compliance.

Encl: -As above.Sd/-

(V.GANDHI)DDG/QCS

For Director General, Ordnance Factories.Copy to:-

1. Addl. DGOF/AV HQrs,2. Addl. DGOF/OEF HQrs.3. Principal Controller of Accounts (Factories): The S.O.P. has been

prepared with concurrence of appropriate authority. You may issue suitable directive to LAOs (Fys).

4. Sr.DDG/OEF HQrs.5. DDG/AV HQrs.6. Sr. Pr.Director/NADP Ambajhari.

No. 16(2)/04/D(QA)Ministry of defence

Department of Defence Production

New Delhi dated 15th June, 2005.ORDER

Subject: Transfer of inspection responsibility of input material including raw material- clarification relating to procedures to be followed by OFs/DGQA.

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Consequent to issue of order of even number dated 31 st March, 2005, transferring responsibility of input material inspection to the manufacturing units, a meeting was held in OFB between the officials of OFB and DGQA to discuss the modalities for implementation of the order.

2. After discussion on the various issues clarifications have been sought from the Department on the following points:

(a) Transfer of inspection responsibility is for all input stores irrespective of source of supply.

(b) Inspection authority shall rest with Ordnance Factory.(c) Clarification in respect of system of quality audit and surveillance.

3. The matter has been examined in the Department and following clarifications are hereby furnished for implementation of the above mentioned order in so far as it concerns OFs:

(a) Input material from vendors: The responsibility of inspection of input materials including raw materials from vendors shall rest with OF concerned. Copies of Supply Orders will be endorsed to respective SQAOs of the receiving factory and concerned AHSP.

(b) Inter Factory Issues: Inter Factory Issues/ transfer shall not be covered under the provisions of the above mentioned order and the present practice of quality audit and surveillance by way of control point check and surveillance check carried out by DGQA shall continue. The inspection note for inter factory transfers shall be issued by Quality Control Wing of the factory. DGQA will issue certificate of having carried out control point checks and surveillance audit.

(c) Imported Stores: The present practice of PDIby DGQA for items being procured through orders placed by DOD including those under TOT shall continue. As far as spares and input material procurement directly by OFB, the responsibility of inspection shall rest with OFs.

(d) Inspection Authority and grant of deviation: The inspection officer shall be designated by OFs. OFs may authorize the inspection officer or an officer in charge of quality control to approve minor deviations in manufacturing details not effecting design, material, serviceability/function, interchangeability, durability and safety. DGQA will provide list of minor deviations allowed during the preceding 05 years to OFs which will be used as guide for allowing minor deviations. The vendors should improve the quality of the product so that grant of deviations is nor perpetuated. Deviations granted shall be intimated to the concerned AHSP giving full details of the supply order, manufacturer, date of inspection, deviation granted. Deviations in design/use of alternate material shall not be allowed by OFs. However, in case deviations in design/use of alternate material is required to be granted in specific supply order keeping in view the immediate requirements, the same may be allowed after due consultations between OFs and AHSP concerned and with the approval of AHSP. In view of above, OFs will not be required to designate Inspection Authority in supply orders placed by them on their vendors. However, OF will obtain drawing, specification and related documents from concerned AHSP for execution of supply order.

(e) Quality Audit and surveillance of Input material and manufacturing process: The quality audit of input material shall encompass checking of test report and other relevant papers. DGQA will allow use of its lab for testing whenever requested by OFs. Relevant records and tests reports, as may be required, are to be produced before DGQA at the time of final inspection. In case of critical items to be identified mutually by OF and concerned Controller/SQAO, selective sampling of input material collected from consignee end will be done by DGQA and tested in the facility available with OF or lab of DGQA without affecting the production

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schedule. The test results shall be shared with the concerned OF. The frequency of sampling will be initially decided while identifying the critical items and frequency will be increased/decreased depending on the performance. In case of difference of opinion in identification of critical items and frequency of sampling, same shall be referred to OFB whose decision in this regard shall be final. DGQA shall continue to perform control point checks and surveillance audit as being carried out at present.

(f) Documentation: OFB and DGQA shall jointly prepare/review comprehensive inspection/Quality Assurance Plan for each product. While undertaking the above exercise, identification of critical items and frequency of sampling as mentioned in para 3(e) above will also be decided. This exercise will be completed latest by 31st

December, 2005 for all factories.

4. In the light of above clarifications, inspection of input material from vendors shall be taken over by OFs with immediate effect but not later than 30th June,2005.

Sd/-(S.Pattanayak)Director (S.I)

Copy to:1. DGOF, OFB Kolkata2. DGQA/Addl.DGQA3. Sr.PPS to Secretary (DP)/PPS to AS(DP)/PS to JS(S)

No. 16(2)/2004/D(QA)Ministry of defence

Department of Defence Production

New Delhi dated 31st March, 2005.ORDER

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Keeping in view the fact that the manufacturer should take the responsibility for the quality of the products they produced and that they should gradually move towards self certification, it is necessary that the responsibility of vendor development and ensuring quality of input material is also taken over entirely by the manufacturer. Keeping in mind the trends noticed in defence production, it is also important to engage the QA Agencies more in the discharge of QA functions intensive, particularly, when sophistication in weaponry and defence equipment is increasing rapidly. With these facts in view, it has been decided with the approval of competent authority to effect the following changes in the duties and responsibilities of DGQA/OFB & DPSUs with immediate effect:-

(a) DGQA shall not inspect input material, including raw-material, required by the manufacturers in the case of Ordnance Factories and Defence Public Sector Units. However, DGQA will continue to do Quality Audit and Surveillance and the manufacturer shall be duty-bound to furnish all the test records and record of other quality checks carried out by the manufacturer for inspection to the DGQA.

(b) Vendor development and Capacity Verification of vendors supplying input material to the Ordnance Factories and Defence PSUs shall be undertaken by the respective Ordnance Factory or the Defence PSUs as the case may be. DGQA registration of vendors shall not be mandatory for vendors to effect supplies to OFB or Defence PSUs. As far as stores/equipment procured directly by the service from Civil trade, the quality assurance of such items shall remain the responsibility of DGQA.

(c ) Sample Rooms maintained by DGQA may be wound up.

(d) DGQA shall not vet indents from OFB.

Sd/-(S.Pattanayak)Director (S.I)

Copy to: Vice Chief of Army Staff Chairman, OFB DGQA MGO/DGOS AOM,AIR HQrs/COM, Naval HQrs, Defence PSUs., PS to RM/RRM, Sr.PPS/PPS/Ps to Secy (Def)/Secy(DP)/Secy(def/Fin)/AS(DP)/PS to JS(S).

SOP FOR INPUT MATERIAL INSPECTION

1.0     INSPECTION OF INPUT MATERIALS :

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1.1     EXISTING PROCEDURE FOR INPUT MATERIAL INSPECTION

          Presently following category of materials are inspected by factory:

All indirect materials irrespective of value

Direct materials in cases where SO value is upto Rs.1 lakh and where store is required urgently to meet production commitments.

Raw-material, Half-wroughts etc.

Input materials for 7 self-certification items and for 16 items under new inspection criteria approved by M of D.

Input materials in case of OCFC.

Input materials in case of VFJ except critical stores.

All the remaining input materials are being inspected by Area Inspector of DGQA.

MOD vide Order No. 16(2) /2004/ D(QA) dated 31st March, 2005 has directed that DGQA shall not inspect input material, including raw material, required by the manufacturers in the case of Ordnance Factories & DPSU. However, DGQA will continue to do Quality Audit and surveillance and the manufacturer shall be duty bound to furnish all the test records and record of other quality checks carried out by the manufacturer for inspection to the DGQA. Further DGQA shall not vet indents from OFB & Sample rooms maintained by DGQA shall be wound up. MOD has also issued clarification vide Order No. 16(2)/04/D (QA) dated 15 th June, 2005 which are relevant for implementing the orders.

1.2     Accordingly, the SOP for input material inspection to be carried out by Ordnance Factory concerned is enumerated in succeeding paras.

Factory shall arrange inspection as per following categories:

1.      Self- Certification Category:  

This status may be awarded to the firms at the discretion of GM for the item fulfilling following criteria:

No rejection found in past three years supplies for the particular item.

The firm should have executed minimum three supply orders during past three years.

Firm is ISO 9001:2000 certified.

Firm is of national and/or International repute i.e. firm must have supplied /exported their goods to reputed firms.

Turn over should be more than Rs. 2 Crore.

The status of self-certification can be granted only when Sr. GM/ GM is fully satisfied regarding quality of stores of the Firm. The responsibility for accepting items on self-certification will be that of Sr. GM/GM and Addl. GM/QC.

2.     Inspection at Firm Premises Category:                   This status may be awarded to the firms at the discretion of GM for the item fulfilling following criterion:

Rejection found in past three years supplies for the particular item does not exceed 5% of total supplies made.

The firm should have executed minimum two supply orders during past three years.

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3.     Inspection on Receipt Category:

This status shall be awarded to the firms for the item not falling in above two categories. In other words Firms with following conditions will be in this category.

Rejection found in past three years supplies for the particular item exceeds 5% of total supplies made.

New source / Executing Development Order. Supplying non-critical stores.

 The above categorization shall be proposed by a sub-committee and approved by GM.  

DETAILED INSPECTION PROCEDURE FOR INPUT MATERIAL INSPECTION  

1.0    Self- Certification Category: 

1.1     THE SUPPLY ORDER WILL STIPULATE THE FOLLOWING: 

1.     Inspection Authority: Inspection Authority is not required to be mentioned in the supply orders

.2.     Inspection Officer: Authorized officer nominated by General Manager (normally QC Officer) shall be Inspection Officer.

3.     Criterion of inspection: Relevant Product Specification & Drawings.

4.     S.O shall clearly stipulate that “GM reserves the right to change the inspection agency to suit the convenience of the Factory and in the interest of State”.

5.     The copy of Supply orders will be endorsed to respective SQAOs of the receiving factory and concerned AHSP. 

1.2                       ACTION BY FIRM:  

The Firm shall give Warranty/ Guarantee, pre-inspection report & Test

certificate of Lot tendered and dispatch the stores to consignee end factory. 

The Firm shall forward its Bills for Payment with pre-inspection report, Test

Certificate, a covering declaration as per format given below and Warranty /

Guarantee certificates in place of I-Note and other necessary documents as per

existing payment procedure. 

1.3                       ACTION BY ACCOUNTS OFFICE  

Account Office shall make Payments on the basis of Warranty/ Guarantee Certificate, pre-inspection report, and Test certificate and a covering declaration by vendor jointly signed by supplier’s Quality control Manager and Proprietor/ Managing Director/ General Manager in prescribed format in place of I-Note. There is no other change in Payment procedure.

                                                            DECLARATION 

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We hereby declare that the products ____quantity ____ supplied by our company ____vide challan No. ____ as per the S.O. no         & date are meeting all requirements laid down in the specification. We here by undertake to replace whole and / or  part consignment as the case may be in the event of its not meeting the requirements / standards laid down in the supply order.

 Quality control Manager                                         Managing Director/ General Manager

Supplier’s   stamp

 1.4         CONSIGNEE END INSPECTION:  

1.4.1   ACTION BY INSPECTION OFFICER:  

On Receipt of stores in the Factory, Inspection Officer shall carry out Consignee end Inspection, obtain production section acceptability/comments, if required and sentence the MIS for taking it to stock charge.  Any discrepancy noticed shall be immediately intimated to the firm for settlement as per procedure in vogue. MIS should be sentenced within 15days from the date of receipt of stores in the factory. 

1.5         ACTION BY ACCOUNTS OFFICE  

Balance Payment shall be made by Account Office as per existing procedure.

1.6     In case the lot tendered by firm is found rejected, the bulk of the same should be stamped rejected with rejection stamp suitably to avoid mixing of such lots in future supply. The firm will be asked to tender fresh lot as per procedure in vogue. 

2.0       Inspection at Firm Premises Category:  

2.1             THE SUPPLY ORDER WILL STIPULATE THE FOLLOWING:  

1.     Inspection Authority: Inspection Authority is not required to be mentioned in the supply orders.

2.     Inspection Officer: Authorized officer nominated by General Manager (normally QC Officer) shall be Inspection Officer.

3.     Criterion of inspection

Relevant Product Specification & Drawings The samples drawal system i.e. whether it will be drawn by representative of

consignee factory or by representative of nearest available Ordnance factory. Material or other Tests to be conducted according to the conditions of Supply

Order i.e. NABL accredited LAB where tests will be conducted. To avoid delays in testing the samples, Factory will enter in to Rate contract in

advance with NABL accredited Labs wherever warranted. Procedure of selection of proof sample. 

4.     S.O shall clearly stipulate that GM reserves the right to change the inspection agency to suit the convenience of the Factory and in the interest of State.

5.     The copy of Supply orders will be endorsed to respective SQAOs of the receiving factory and concerned AHSP. 

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2.2     The DGM/Standard Cell on receipt of copy of Supply Order shall prepare detailed Inspection Criteria and monitoring instructions and issue to Inspecting Officer. 

2.3     The Firm shall intimate to Inspection Officer with a copy to Sample drawal factory regarding readiness of material for inspection with following details:

1. Supply order No. & Date

2. Date of readiness of material

3. Item description and item code as per supply order

4. Quantity being tendered with pre-inspection report

5. Quantity within Delivery schedule or not. If not Firm should take DP Extension from Purchase Officer and submit the copy of DP amendment letter / quote the reference to the Inspection Officer.

 2.4     The Inspection Officer shall depute sample drawal / Inspection team to the Firm on receipt

of inspection call letter from Firm. 

2.5             Procedure For Drawing Samples:

2.5.1   ACTION BY VISITING TEAM  

The Ordnance Factory representatives shall visit the Firm and take following actions:

Every factory shall provide individual & distinctive metal seals to the inspectors considered for the work of inspection / drawal of samples at Firm’s premises. The Ordnance Factory representative (inspector) visiting the firm shall carry his assigned metal seal.

Draw requisite number of random samples as per relevant standard & sampling Plan and seal & bond the bulk.

Sealing Procedure for samples: The samples drawn shall be sealed by both Firm and the OF representative visiting Firm. Separate sealed packet shall be made if samples are to be handed over to NABL Accredited Lab for Testing by Quality control Officer of Near by Ordnance Factory.  

Sealing & Bonding Procedure for Bulk: Ordnance Factory representative visiting the firm shall seal the Material. The Ordnance Factory representative shall emboss seal and also sign on the paper pasted at the joints of the packing. Sealed material shall be kept in bond room. Small items can be bonded in a container named as “Bonding Container”.  The bond room (or Bonding container) shall be locked with a lock to be operated by two keys like Lockers in the Bank or put two locks. One Key should be with the representative visiting firm & other with the Firm. In case of two locks, keys of one lock will be with the firm and keys of other lock shall be with representative visiting Firm. The Ordnance Factory representative-visiting firm shall deposit the key with the Inspection Officer in case he comes from consignee factory. In case Ordnance Factory representative comes from near by factory, he shall deposit key immediately with the Officer responsible for Quality Control in his (near-by factory) Factory.  

Forward the requisite number of samples duly sealed by Firm and OF representative visiting Firm to the Inspection Officer of Concerned Ordnance Factory by speed post / courier service or take it personally. 

Submit samples duly sealed by Firm and himself to designated QC Officer of nearby Factory in case the samples are required to be sent to NABL Accredited Lab for Testing by designated QC officer.

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2.5.2 Action by designated QC Officer of Near-by Ordnance Factory  

Check the seals of samples received from OF representative visiting Firm & Open the samples.

Pack the samples along with Test button/ Test Slabs/Test Piece as required and seal the packet.

Forward samples to concerned NABL / authorized Lab. along with Test button/ Test Slabs/Test Piece through different person (Not the person who had drawn the samples from Firm’s premises) as applicable as per directives of consignee factory / Inspection Officer.

Secrecy of Samples To maintain the secrecy of samples, a random reference Number will be given along with sample to the NABL Lab. The Name of Firm whose sample is being tested shall not appear on the requisition handed over to the NABL Lab. The same reference number along with other details of supply order and firm name etc. will be sent to the Inspection Officer by confidential speed post by designated QC Officer to enable linking.

NABL Lab shall forward the report directly to Inspection Officer in sealed cover. Designated QC Officer of nearby factory shall arrange to receive keys of Bonded

bulk and arrange to keep in safe custody and arrange to depute another representative (Not the same person who visited to draw samples) with acceptance stamp on receipt of instructions from Inspecting Officer. 

2.5.3   ACTION BY INSPECTION OFFICER  

On receipt of samples from Rep. deputed, the inspection officer of consignee Factory shall carry out visual and dimensional inspection and shall arrange testing of samples including proof of empty / Fitment trial wherever applicable. 

In case consignee Factory representative brings samples personally to the factory that are required to be tested in own/NABL Accredited Lab, the inspection Officer shall arrange to send these samples to own/NABL Accredited Lab as per procedure laid down at 2.5.2 above. 

A report shall be prepared by inspection Officer based on above inspection and own/NABL Accredited Lab report wherever applicable. 

Inspection Officer shall obtain comments of acceptability from concerned production section, if required, before sentencing the material. 

Inspection Officer shall sentence I-Note based on Test Results and feedback from user section, wherever applicable. 

Inspection officer shall forward I-Note to sample drawal factory in case samples drawn by latter. 

The computerized record of person being deputed should be maintained by the inspection Officer with Supply Order No., Firms name, Item code, Item Nomenclature, quantity etc. 

Inspection Officer shall depute another representative (not the same person who had drawn the samples & sealed) to the Firm from consignee Ordnance factory. In case samples are drawn by sample drawal factory the inspection Officer with the help of Quality control officer of sample drawal factory shall depute another representative (not the same person who had drawn the samples & sealed) to the Firm. The representative shall carry the key to open the bond room (in case item bonded) along with copy of I-Note.  The representative shall check the seal of bulk, stamp@ acceptance mark and hand over I-Note to the firm. 

@: Every Ordnance factory shall provide individual & distinctive  stamp acceptance / stamp rejection to the inspectors(representatives) considered for this job. In case the item is stamped by representative

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of sample drawal factory (near-by Factory) the stamp mark will be that of the individual visiting as assigned to him. 

2.5.4       ACTION BY FIRM :  

The firm shall dispatch the accepted stores with seal intact duly stamped with acceptance mark. The Firm shall forward its Bills for Payment with I-Note and other documents as per procedure in vogue. 

2.5.5   ACTION BY ACCOUNTS OFFICE  

Account Office shall make Payments as per procedure in vogue

2.6       CONSIGNEE END INSPECTION:  

2.6.1   ACTION BY INSPECTION OFFICER:

On Receipt of stores in the Factory the seal and acceptance stamp should be checked. Inspection Officer shall carry out Consignee end Inspection, obtain production section acceptability/ comments, if required and sentence the MIS for taking the item in to stock charge. MIS should be sentenced within 15 days from the date of receipt of stores in the factory. Any discrepancy noticed shall be immediately intimated to the firm for settlement. 

2.6.2   ACTION BY ACCOUNTS OFFICE

Balance Payment shall be made by Account Office based on sentenced MIS as per procedure in vogue. 

2.7     In case the samples tendered by firm are found rejected, the bulk of the same should be stamped rejected with rejection stamp suitably to avoid mixing of such lots in future supply. The firm will be asked to tender fresh lot as per procedure in vogue. 

3.0       Inspection on Receipt Category:  

3.1         THE SUPPLY ORDER WILL STIPULATE THE FOLLOWING:  

1.     Inspection Authority: Inspection Authority is not required to be mentioned in the supply orders. 

2.     Inspection Officer : Authorized officer nominated by General Manager (normally QC Officer) shall be Inspection Officer.

3.     Criterion of inspection

Relevant Product Specification & Drawings Material or other Tests to be conducted according to the conditions of Supply

Order i.e. NABL accredited LAB where tests will be conducted. To avoid delays in testing the samples, Factory will enter in to Rate contract in

advance with NABL accredited Labs wherever warranted. Procedure of selection of proof sample (if required). 

4.     S.O shall clearly stipulate that “GM reserves the right to change the inspection agency to suit the convenience of the Factory and in the interest of State”.

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5.     The copy of Supply orders will be endorsed to respective SQAOs of the receiving factory and concerned AHSP. 

3.2                         ACTION BY FIRM:

The Firm shall dispatch the Bulk stores for inspection and payment to the Consignee end Factory as per Delivery schedule.  In case Delivery schedule is expired the Firm shall take approval & DP Extension from Purchase Officer before dispatching the store. 

3.3                         ACTION BY INSPECTION OFFICER:

On Receipt of stores in the Factory, the inspection Officer shall arrange for inspection of the store against MIS as following: 

The inspection officer of consignee Factory shall arrange for drawal of samples as per relevant standards & sampling plans. He shall arrange to carry out

1. Visual and dimensional inspection2. Proof of empty / Fitment trial wherever applicable.3. Forward samples to own/ NABL accredited Lab wherever warranted.

A report shall be prepared by inspection Officer based on above inspection and NABL Accredited Lab reports. 

Inspection Officer shall obtain comments of acceptability from concerned production section, if required, before sentencing the material. 

Inspection Officer shall sentence MIS based on Test Results as per above paragraphs. MIS should be sentenced within 15 days from the date of receipt of stores in the factory. 

3.4                         ACTION BY ACCOUNTS OFFICE:  

Accounts Office shall make payment to the Firm as per procedure in vogue. 

3.5          In case the lot tendered by firm is found rejected, the bulk of the same should be stamped rejected with rejection stamp suitably to avoid mixing of such lots in future supply. The firm will be asked to tender fresh lot as per procedure in vogue. 

 4.0         IFD ITEMS :-  

4.1         The present practice of quality audit and surveillance by way of control point check and surveillance check carried out by DGQA shall continue.   

4.2         The inspection note for inter factory transfers shall be issued by quality Control Wing of the factory.  

4.3          DGQA will issue certificate of having carried out control point checks and surveillance audit. 

5.0                           Imported Stores:  

5.1         The present practice of PDI by DGQA for items being procured through orders placed by DOD including those under TOT shall continue.  

5.2          As far as spares and input material procured directly by OFB, the responsibility of inspection shall rest with OFs.

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 6.0       Quality Audit and surveillance of input material and   manufacturing process :   

6.1          Factory will provide test report and other relevant papers on demand for quality audit by DGQA. 

6.2          DGQA will allow use of its lab for testing whenever requested by OFs.  6.3          Relevant records and tests reports, as may be required, are to be produced

before DGQA at the time of final inspection.  6.4         In case of critical items to be identified mutually by OF and concerned

Controllers/SQAO, selective sampling of input material collected from consignee end will be done by DGQA and tested in the facility available with OF or lab of DGQA without affecting the production schedule.  The test results shall be shared with the concerned OF.  The frequency of sampling will be initially decided while identifying the critical items and frequency will be increased/decreased depending on the performance.  In case of difference of opinion in identification of critical items and frequency of sampling, same shall be referred to OFB whose decision in this regard shall be final.

6.5         DGQA shall continue to perform control point checks and surveillance audit as being carried out at present. 

7.0         Documentation :   Standard Office of the Factory and SQAE shall jointly prepare/review comprehensive inspection/Quality Assurance Plan for each product.  While undertaking the above exercise, identification of critical items and frequency of sampling as mentioned in para 6.4 above will also decided.  This exercise will be completed latest by 31st December, 2005.

8.0 Inspection Officer: Sr. General Manager/ General manager shall nominate an Officer in the Rank of Jt. GM/ DGM (normally Quality control Officer) who shall function as Inspection Officer.

9.0 Sample Room: Sample Rooms maintained by DGQA shall be wound up. Therefore Ordnance Factories shall maintain the sample rooms. Sample room should maintain sealed samples and certified samples. Certified samples must be used as guidance samples for inspection.Sealed Samples : Sealed sample form a part of paper particulars governing supplies.Certified Samples : Certified samples are similar to sealed sample, which is issued for guidance in inspection. 10.0 Vigilance Check Sample: General Manager shall arrange for drawal of samples from the bonded/ sealed lots at the Firm’s premises on random basis independently. These samples shall be tested and compared with the samples drawn by representative deputed by Inspection Officer. This exercise must be ensured before payment to the Firm is made.  

11.0 Standard Cell: A cell shall be created in all Ordnance factories under the overall control of AGM/QC and headed by DGM/standards, which shall perform following functions:

Shall vet indents placed on OFB concerning the Factory Shall vet extracts placed by OFB on Factory Shall vet IFDs Shall vet the Tender enquiries Shall vet Supply Orders placed by the factory Shall issue monitoring instructions for inspection Shall maintain all records in computer for deviations granted and price reduction

imposed. Shall initiate action for continual improvement through Alteration committee

where better material at competitive rates is available than design/specification. Shall maintain & upkeep Drawings for input materials.

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Shall maintain & upkeep sample room. Shall prepare in association with SQAE the critical stores list and sampling

frequency of these critical stores for drawal of samples by SQAE. Shall supply the latest drawings and specifications to demanding shops /

sections and will withdraw superceded drawing / specifications from the shop / section.  

12.0   Deviations: Circumstances arise when the supplier of a store may request permission to depart from the particular guiding production specifications. Such requests may be made either prior to the commencement of production or entail grant of a concession to accept errors made during the manufacturing of a store. The authorization of an intentional departure from store specification, in order to facilitate production, will be made by the issue of a deviation permit.  12.1   Deviation Permit: A deviation permit constitutes permission to use material or to manufacture components and stores, which differ from design or specification and is limited in its application to cover a definite quantity or period or a particular S.O. Authority for granting a Deviation Permit rests with the appropriate authority. Full particulars of the departure authorized must be stated in the permit. 

All records of deviation granted shall be maintained on computer.  The standard cell shall periodically review the deviations granted in respect of a

particular store and in consultation with AHSP will consider whether particulars could be amended to incorporate such deviations persistently occurring to make the specifications more realistic.  

In case better material is available at competitive rates than design/specification, the proposal for continual improvement through Alteration committee shall be initiated by standard cell. 

In the past system was existing where deviation were granted in following categories:  

Category of Deviation Nature of DeviatiobnA Major deviations in design and material affecting

serviceability/function, interchangeability or durability, but not safety.

B Major Deviations in design and material affecting durability but not affecting serviceability/function, interchangeability or safety.

C Deviations in design and material causing minor changes in durability, but not affecting serviceability /function, interchangeability or safety.

D Minor deviations in design and material but not affecting durability, serviceability/function, interchangeability or safety.

E Minor deviations in manufacturing details not affecting design, material, serviceability/ functions, interchangeability, durability or safety.

  CVC has issued guidelines that sub-standard material should not be accepted even with price reduction. Accordingly material falling in A, B & C categories shall normally not be granted any deviation. However there may be need to accept material with minor deviations that do not

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affect serviceability / function, durability, interchangeability or safety. In such cases GM may authorise the officer in charge of quality control (AGM/QC) to approve minor deviations in manufacturing details not affecting design, material, serviceability / functions, interchangeability, durability and safety.  DGQA will provide list of minor deviations allowed during the preceding 05 years to OFs which will be used as guide for allowing minor deviations.  The vendors should improve the quality of the product so that grant of deviations is not perpetuated.  Deviations granted shall be intimated to the concerned AHSP giving full details of the supply order, manufacturer, date of inspection, deviation granted. Deviations in design/use of alternate material shall not be allowed by OFs.  However, in case deviations in design/use of alternate material is required to be granted in specific supply order keeping in view the immediate requirements, the same may be allowed after due consultations between OFs and AHSP concerned and with the approval of AHSP.   

12.2         The Format of PD Form is given below at 12.4. The production/QC section shall intimate the need to accept the material on deviation to Material Management section, who in turn, shall fill and initiate PD Form given at 12.4 along with Deviation Discount (DD) form, wherever required, given at 12.5 below. The Deviation in PD form shall be filled up and approved by the sanctioning authority authorised by General Manager.  12.3         There may be cases where deviation, so granted, have significant bearing on the cost of the material. In such cases, General Manager may like to obtain suitable discount from the firm. A Standing Committee as given in table 12.6 below may be formed for deciding the amount of discount. The Standing Committee will decide the quantum of discount and Material Management Section shall intimate the discount decided by the committee to the firm. On receipt of written agreement from firm, the Supply Order shall be amended by Material Management Section to indicate the amount of discount and the MIS will be sentenced and accepted on deviation.  

12.4             PRODUCTION DEVIATION FORM

( Use one form for only one item)

S.O/IFD No.____________  date_____________

MIS No.________________ date_____________

i)          Name of Supplier_______________________________________

ii)         Nomenclature of Store______________________________________

iii)         Particulars quoted_________________________________________

Drawing No._____________________________________________

Specifications____________________________________________

Other Particulars__________________________________________

iv)   Period, quantity or lot Nos. for which deviation required

_________________________________________________________

v)           Description of deviation required  ____________________

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vi)          Details of specified and suggested material (Chemical & Physical) (in cases of

materials only), including a comparative statement of value per unit of specified

and of suggested material readily available.

Specified                                                               Suggested

vii)         Category for deviation:

 

Jt. GM/DGM/WM / Material Management

Approved by AGM/QC.

  

12.5   DEVIATION DISCOUNT FORM

12.5.1          PART  I

S.O.NO.    :                                              Date    :                               Supplier  :

Item           :                                                                           Item Code: 

Qty on order :                                                   Rate         :                                                                         Qty. of Deviation

Qty accepted under original requirement :

Details of stores accepted earlier under deviation :

------------------------------------------------------------------------------------------------------------

Sl..No.           Supplier   Qty.               Nature of           Category         Ref. No.

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                                      accepted         deviation

----------------------------------------------------------------------------------------------------------------------M.I.S No. & Date  :

Category of deviation :

Deviation sanctioned by : enclose sanctioned PDF Form

                                                                                                     

                                                                                                                        DO/MM 

12.5.2          PART  II

RECOMMENDATION OF STANDING COMMITTEE 

Quantum of Deviation Discount recommended (justification for the quantum of DD to be given) Qty. acceptable :

Reference under which firm has accepted Deviation discount :

Remarks  :

Date  : 

 

DGM/Standard      DO/QC       DO/Prodn.         AO             DO/MM  

12.6     STANDING COMMITTEE FOR GRANT OF DEVIATION DISCOUNT                                                    

 

STANDING   COMMITTEE QUANTUM OF DISCOUNT SANCIONING AUTHORITY

GO/DO QC

DGM/ Standard

GO/DO PV(MM)

GO/DO PROD.

A.O Rep.

Committee to decide AGM/QC up to 5%,

Sr.GM/GM

beyond that

 

13.0           Dispute: 

In case of dispute between Firm and inspection Officer, the case shall be referred to

General Manager for appropriate test and decision.

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Annexure-56NO. 108/TIR/TS/QCSGOVT OF INDIA, MINISTRY OF DEFENCEORDNANCE FACTORY BOARD10A, S.K .BOSE ROADKOLKATA – 700001,

DATE 13-9-2005

ToThe Sr. General Manager/General Manager

Sub: Transfer of Capacity Verification & Vendor Registration responsibility from DGQA to DGOF.

Ref: i) MOD Order No.16 (2)/2004/D (QA) dt 31-03-05

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ii) MOD Order No. 16(2)/04/D (QA) dt 15-06-05

iii) OFB Letter No. 108/TIR/TS/QCS dt. 23-06-05

MOD has issued order for transfer of responsibility in respect of input material

inspection, capacity verification and vendor registration from DGQA to DGOF vide letter quoted

at reference (i) above.

01. The SOP for input material inspection was forwarded vide letter quoted at reference iii) above.

02. Standard Operating Procedure (SOP) for capacity verification and vendor registration is being forwarded herewith.

03. Kindly ensure that capacity verification and vendor registration of Firms is done strictly as per the procedure given in the SOP. The SOP is having five Appendixes and a guide for Appendix-1.

01 The SOP is also mailed through COMNET.

(V. GANDHI)

DDG/QCS

for Director General Ordnance Factories

Copy to : -

1. Addl.DGOF/AV/HQrs.

Avadi, Chennai – 600 054.

2. Addl. DGOF/OEF HQrs.Kanpur – 208 013.

3. Principal Controller of Accounts(Fys) : The SOP has been prepared with the

10-A, S.K. Bose Road concurrence of appropriate authority.

Kolkata –700 001 You may issue suitable directives to LAO(Fys).

4. Sr. DDG/OEF HQrsKanpur – 208 013

5. DDG/AV HQrs. Avadi, Chennai-600 054

6. Sr. Pr. Director, NADP Ambajhari, Nagpur-440 021

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N.O.O.

Copy to :-

Chairman / OFB

All Members / OFB

Sr. DDG / All DDGs / OFB

C of F (D)

DDG/MM (K) Kindly arrange to publish a general notice as per para 10.1 of SOP.

STANDARD OPERATING PROCEDURE

FORCAPACITY VERIFICATION

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ANDVENDOR REGISTRATION

1. INTRODUCTION:

M of D vide letter No. 16(2)/2004/D(QA) dt 31-3-05 has directed that Vendor development and capacity verification of vendors supplying input material to the Ordnance Factories and Defence PSUs shall be undertaken by the respective Ordnance Factory or the Defence PSUs as the case may be. DGQA registration of vendors shall not be mandatory for vendors to effect supplies to OFB or Defence PSUs. Accordingly, the SOP for vendor development, capacity verification, vendor registration and vendor rating is enumerated in succeeding paras.

2. COMPETENT AUTHORITIES :

In respect of capacity assessment and vendor registration, the GM of the factory concerned shall be competent authority in all respects.

3. SCOPE : This SOP is intended to give general guidelines for carrying out vendor assessment, capacity verification and vendor registration both in respect of existing sources and also for new vendors and grading them based on their assessed capabilities for initial registration and for its periodical

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renewal and removal. The document further lays down guidelines for rating of vendors based on their recorded performance in respect of quality, delivery, Price and experience including various aspects of post procurement services.

4. NECESSARY BACKGROUND REQUIRED FOR VENDOR ASSESSMENT

A thorough and in depth knowledge of the requirements of quality management systems as laid down in ISO: 9001:2000 is necessary. In particular technical expertise is required in the following areas to carry out vendor assessment effectively: -

a. Quality of Design - Material drawings, performance reliability and design evaluation reports.

b. Quality of production Processes - Production process, Process Documentation, Machinery & Control instrumentation.

c. Production quality control - Systematic quality checks, completeness, adequacy & documentation. .

d. Quality of Vendors - Quality Plan maintained by Vendors.e. Quality of Material - Incoming raw material testing facilities, System of material

checking, maintenance of records & treatment of rejected material.f. Quality of End product - Evaluation of end product quality, maintenance of systematic

record.

To ensure uniformity in vendor assessment and rating and provide comprehensive guidance for assessment terms, the competent accepting authority as indicated in para 2 will issue specific norms /guidelines for product/technologies of their responsibility and the quality systems required.

1. DEFINITIONS :a. Vendor Registration Request Form : The form containing the information about the

nature of the organisation, details of the personnel, plant and equipment , quality control facilities, nature of the products , licenced capacity for their products , financial status and stores for which registration is sought – submitted by the firm.

b. Vendor Quality Survey Report : The Form containing the information for capacity assessment of Firm. The format is available in two parts. The details in the form shall be filled by visiting Capacity verification team. The form is provided with marking scheme to assist in grading of firms.

c. Vendor Rating : Vendor rating is the system of rating of vendors based on performance in respect of quality of supplies, deliveries and service.

d. Composite Index : The composite Index is the average of all ratings viz. Quality, Delivery, Price & Service for the same product by the vendor over a period of preceding three years This could be an index of assessing the overall quality of products and performance of a firm for procurement purposes and renewal of registration.

e. Established Suppliers : A supplier who has successfully completed supply i.e. both in respect of quality reliability and timely delivery of the stores against one S.O. and supplied for minimum of 50% of intended quantity against tender shall qualify as established supplier for the particular item. Such firm shall qualify as established vendor for the same item to sister Ordnance Factories also on production of proof of registration.

f. New Source : A supplier who intends to develop the defence stores or who attempts to indigenise a product shall be termed as a new source.

g. Development Order : Supply order placed on New Source as a result of Open Tender Enquiry for Source development.

h. Registered Vendor : A vendor who applies for registration and as a result of Capacity verification & other formalities is awarded Registration certificate by an Ordnance Factory. The Vendor shall qualify as registered vendor to a sister Ordnance Factory also for the same item.

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2. GENERAL :

The overall procedure in this SOP comprises of the following: -a. Assessment, Registration, Renewal and de-registration/ Removal of suppliersb. Monitoring of vendor performancec. Suspension and Banning of business dealing with errant firmsd. Compilation of compendium of Established Suppliers.

3. AGENCY TO UNDERTAKE CAPACITY ASSESSMENT AND VENDOR REGISTRATION:

Respective Ordnance factories will undertake the task of capacity assessment and vendor registration.

4. PROCEDURE FOR REGISTRATION OF VENDORS

8.1 Issue of vendor registration request forms

Vendor Registration Request Forms shall be issued to prospective vendors on request by each Ordnance Factory.

8.2 Initial Assessment of Vendors:

Based on the information furnished by the firms in the Vendor Registration Request Forms, classification of the firms will be done by a multifunctional team of group ‘A’ officers from production, quality control, planning, material management and finance functions. The committee will be headed by AGM/QC. Qualification of Firms shall be done as per guidelines and marking scheme given in Guide for Appendix ‘I’. The firms qualifying shall be subjected to capacity verification.

8.3 Capacity verification of firms:

a. The team for Capacity Verification shall comprise of officers from factory’s QC Department and Production Department. The team shall consist of officers in gazetted Group ‘A’ or ‘B’ rank and at least one of the member should be a qualified lead auditor. If none of the member in teams is qualified lead auditor, an additional member at Sr. NG level with this qualification can be included in the team. The team will verify the facts as furnished by the firm in Vendor Registration Request Form, after visiting the firm’s production units and allocate marks and rating in the vendor quality survey report (Enclosed at Appendix II).

b. After capacity verification the grading of Firms shall be done based on guidelines and numbering scheme given in Appendix-II.

5. PROCEDURE FOR REGISTRATION OF NEW SUPPLIERS 9.1 Requirement for source development:

20% of annual requirement will be covered for developing New Sources as per present provisioning procedure.

9.2 Intent for source development: Open Advertisement shall be made indicating intent for source development mentioning the requirement of the item. Advertisement will make it explicit that only actual manufacturers will be considered and tender will be issued after satisfying in respect of capacity & capability after due verification. Such other conditions in regards to specific plant & machines and manufacturing capability, which the firm must possess in order to manufacture and supply the item, should also be included in the Advertisement stating that only those firms who possess these capabilities should apply. Otherwise their offers will be summarily rejected.

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Also the firms will be required to quote for minimum 50% of the intended quantity against Tender (to be issued later) otherwise their offers will be treated as invalid.

9.3 Vendor RegistrationThe vendor registration process as mentioned in para 8.1, 8.2 & 8.3 shall be undertaken.

9.4 Issue of TE for source development:

Based on recommendation of Capacity Verification team the formal Tender Enquiry for source development shall be issued to successful Firms only.

9.5 Development Order Supply order shall be finalized as a result of Tender Enquiry for source development following the requisite provisioning procedure by respective TPC. In all the concluded contracts as a result of Tender Enquiry for source development, a realistic delivery schedule will be provided after consideration of complexities of the item and all stages of advance sample manufacture and for manufacture and inspection of bulk supplies.

9.6 Qualification of New Firms as Established Suppliers:

New firms will qualify to become established suppliers after completing one supply order successfully provided they meet quality, reliability requirements and also supply 50% of intended quantity given in tender enquiry.

6. RENEWAL OF REGISTRATION OF SUPPLIERS

Registration is valid for three years unless extended. At the end of three years the renewal of registration/capacity verification falls due. The Ordnance Factory concerned shall take the information regarding validity of registration from OFB compendium (to be compiled in terms of para 15) / DGQA compendium (during transition period not extending July 2008) or a written confirmation from DGQA. Ordnance Factory shall initiate action for capacity verification and revalidation of firm’s registration on receipt of request & prescribed fee from the Firm.

10.1 Application for renewal of Registration:

Ordnance Factory Board (MM Division) shall publish a general notice indicating that all vendors registered with DGQA and supplying products to ordnance factories shall apply to the concerned Ordnance factory for renewal of registration six months prior to expiry of validity of registration. Vendors whose registration is expiring within six months of the date of publication of the notice shall apply immediately. In case vendor is supplying the same product to more than one Ordnance Factory, it needs to apply to only one Ordnance Factory.

It is mandatory that all vendors registered in the compendium of approved suppliers will apply for renewal of registration in a letter, addressed to the concerned factory GM or his designated representative in case they wish to continue as approved suppliers of the compendium. The vendor will make this application at least 180 days prior to expiry date of previous registration. Registration of firms who do not apply for renewal as prescribed above will lapse and their names may be removed from the compendium of approved suppliers. No show cause notice is required to be issued to the vendor in such cases. As and when such firms apply later assessment will be done as per procedure for initial registration and assessment fee will be charged from such firms.

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The information of renewal of registration shall also be given by concerned Ordnance factory to sister Ordnance Factories producing same/ similar products.

10.2 Procedure & Charges for renewal of Registration :

The aforesaid procedure prescribed for initial registration will be followed for renewal also. The following guidelines may be followed regarding recovery of assessment fee and the requirement of a visit to the premises of the firm: -

a. In case the firm has applied for renewal of registration for only those items/generic group of items for which it is already registered and it has satisfactorily supplied all these items/generic group of items during the past three years without any adverse feed back, the registration of the firm may be renewed based on its satisfactory performance / vendor rating. In such cases and where there are no changes in the infrastructure, no visit will be required. In case there are infrastructural changes, it is up to the discretion of the concerned GM on whether a visit is necessary. In all such case where visit for capacity verification is not required, no assessment fee will be charged.

b. In case other than (a) above, where the vendor applies for additional items or has not supplied all the items or a specific generic group of items for which they are registered during the past three years or the performance of the firm is not satisfactory for any or all of the items/generic group, the firm will be asked to submit all the documents afresh and a re-verification visit will be carried out. In such cases assessment fee will also be charged.

c. Applications for general registration of additional items from existing vendors will NOT be entertained earlier than expiry of 6 months from date of last registration /visit. Similarly no firm will be visited within a period of six months from the date of last visit.

7. SPECIAL NOTE : a. Firms registered with DGQA and whose supplies are satisfactory will be subjected to capacity

verification in terms of para 8.1, 8.2 & 8.3 on receipt of their application for renewal as mentioned in para 10.1.

b. The last successful suppliers will continue to be on the vendors’ list till Capacity assessment indicates otherwise.

c. In case supplies are not satisfactory, the capacity verification of such firm can be taken up by Ordnance factory on its own in the following contingencies: The basis on which registration was done ceases to exist i.e. Firm has sold the machines,

The management has changed the skill workmen having retired or any other such reason. The Firm has performed unsatisfactorily against a contract awarded to it. The Firm has indulged in unethical trade practices such as bribe, giving allurements or

refuse to honour commitments etc. The vendor rating of the Firm has come down below 70%.

In the above said contingencies, it shall be necessary to give the firm an opportunity of showing cause against the proposed action.d. All type of information regarding registration, renewal of registration, de-registration/

Removal shall be intimated by Ordnance Factory concerned to sister Ordnance Factories producing same end product.

e. The registration done by sister Ordnance Factories shall be sufficient and separate registration will not be done in respect of same product for same firm.

8. VALIDITY OF RENEWAL :All renewal of registration will be valid for a period of three years from date of issue of

certificate. Renewal of registration, with or without a visit to the premises of the firm, will be

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done as due. The matter regarding charging of assessment fee in such cases will be decided in accordance with relevant para.

9. CERTIFICATE FOR RENEWAL REGISTRATION : For renewal of registration, certificate as per specimen given at Appendix “V” will be awarded to the firm.

10. CATEGORISATION FOR REGISTRATION : In addition to grading, vendors will be assessed for categorisation depending on their infrastructure and capabilities for one or more type of activities like design, development & production. The firms will, therefore also be categorised as under :-

(a) Design, Development & Production (DDP) : Firms who have design capability and infrastructure for Research & Development apart from manufacturing capability covering all requirements of a quality system will be registered for all three capabilities and categorised “DDP”.

(b) Development & Production : Such firms will have capability for development and bulk manufacture only. Such firms will obviously not have infrastructure for design i.e. conversion of a concept into an engineering design. Accordingly these firms will be categorised as “DP”.

(c) Production (P) : All other firms having only production facilities for converting defence design into hardware or end stores or those capable of specified process such as fabrication, casting, machining etc. will be categorised as “P”.

(d) Authorised dealer/ Stockist/ Trader (S): Authorised dealer/ Sole Selling Agent/ Stockist / Trader etc. shall be categorised as “S”.

11. COMPENDIUM :

For the purposes of registration of firms in the compendium of approved suppliers, comprehensive gradation of the firm will be indicated viz. classification of the vendor as an industry (Large, Medium or small scale), category as per para 14 above and grading as per para 8.3 above. For example a medium scale industry having all facilities obtaining Grade II grading will be designated as M/s……………………. (MS-DDP-Grade II) in the compendium of approved suppliers as well as in the Registration Certificate.

15.1 Agency responsible for maintaining and updating of Compendium:

Each Factory shall submit computerized data in prescribed format given at Appendix – III to operating division of Ordnance Factory Board/AVHQ/OEFHQ as applicable. The operating division shall be responsible for maintaining compendium of suppliers for their division in computerized format.

QCS Division of OFB shall be responsible for integrating the compendium for whole organisation.

12. VENDOR’S CODE : 28-digit Vendor code shall be allotted as per following Table :Char Description Type Entry Remarks1 Major Code for Material Num 02 As per DGOF codification

Manual23 Vendors Name Alpha XY Abbreviation e.g.

BF for Bharat Forge45 Pin Num 208001 Postal Pin code67

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891011 Fy. Code Num 107121314 Grade Num 2 1,2,3 for I,II,III15 Class( Large/Med./Small) Alpha L L/M/S16 Categorisation

(as per para 14)Num 2 1 for DDP

2 for DP3 for P4 for Supply ( Trader)

17 Fy. Reg. Sl. No. Num 0026 Running Sl. No.0026 means 25 firms have been registered before this

18192021 Vendor”s TAN No. AN c-1234-d22232425262728

13. ISSUE OF REGISTRATION CERTIFICATE :

After vendor assessment and approval of recommendations to register a firm in the compendium of approved suppliers by the Accepting Authorities, a registration certificate as per specimen given at Appendix “IV” attached will be issued by the Accepting Authority or his authorised representative. Registration of firms will not be issued /intimated in any other format except the certificate as per specimen mentioned above. Copies of the registration certificate will be endorsed to the following where required: - (a) The firm concerned(b) OFB(c) Sister OF producing same end product.

14. CONTENTS OF REGISTRATION CERTIFICATE :

In respect of items for which registration is accorded, the contents of the registration certificate should be prepared as per the following guidelines: - (a) A combination of generic and specific description of the stores/processes should be

included.(b) The range of dimensions/weight /tolerance limits should be specified where applicable.(c) Specific technology may be mentioned.(d) In case of process such as machining, casting, forging etc mention may be made of

components / subassemblies / assemblies (as examples) which the vendor is capable of manufacturing.

(e) Where possible necessary specifications and /or drawings may be indicated.(f) Vendor Registration shall be for a particular item or a group of items or for a process.

The registration certificate issued to the Vendor after carrying out Capacity Verification shall indicate the list of items or the process for which they are granted registration.

(g) The vendor code as mentioned in para 16 shall be mentioned in the certificate.

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(h) The Certificate must be electronically generated from computer system to facilitate track of records and search. Following fields must be recorded in the computer system

Vendor code 28 Alphanumeric Date of Registration 8 Date Date of Expiry 8 Date Firms name 15 CharTechnology 15 CharItem 1 20 CharItem 2 20 CharItem 3 20 CharItem 4 20 Char

In case list is exhaustive only major items and Technology shall be recorded as above in database files for quick access & retrieval.

15. VALIDITY OF REGISTRATION :

The registration will be valid for a period of three years.

16. ACTION ON REJECTION FOR REGISTRATION :

In case it is not possible to register a vendor due to deficiencies noted during assessment, the details of the deficiencies noted will be intimated to the firm as an advice by the Accepting Authority /Authorised representative indicating that the firm may apply for registration afresh within a prescribed time frame. Normally reassessment of such firms will be taken up only after one year and on payment of fresh assessment, charges for initial registration. However, re-assessment may be taken up earlier at the discretion of the Accepting Authority for reasons to be recorded in writing depending on the nature of deficiencies noted earlier and merits of the case.

To avoid the possibility of vendors for a particular item who may have been rejected for registration by one Authority seeking to get registered through some other Authority dealing with similar items, it will be incumbent on the initiating authorities to obtain all information regarding previous application for assessment from the vendor prior to taking up any assessment.

Whenever an Ordnance Factory during the exercise of capacity verification decides not to register a firm due to reasons of insufficient capacity/ capability, it shall inform all sister Ordnance factories producing the same/ similar products.

17. ASSESSMENT FEE :The charges for registration shall be as under: -(a) Large & Medium Scale Industries Rs. 5000/-(c) Small Scale firms Rs. 2000/-

The assessment fee will be recovered in the following contingencies: -

(a) All initial assessment.(b) Established sources registered with DGQA and required to be registered for first time

with Ordnance Factory on renewal date.(c) For additional items involving new Technology/Design at any stage after initial

registration /renewal requiring capacity verification. (d) Change of location/premises of firm involving fresh visit.(e) In case firms already registered fail to apply for renewal within prescribed period of six

months before expiry, considered as fresh assessment.

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The assessment fee will NOT be charged in the following contingencies: -(a) Renewal of registration in normal manner during prescribed period.(b) Registration for additional item/s of similar technology/design for which firm is already

registered and visit for capacity verification is not required.(c) Change in status of firm e.g. from proprietary to partnership or private limited etc.

18. REMOVAL OF VENDORS FROM COMPENDIUM OF REGISTERED SUPPLIERS :

Removal of vendors from the compendium of registered suppliers may be ordered on the following grounds: -

(a) If a firm fails to execute a contract.(b) If the composite Index of vendor rating falls below 70%.(c) If a firm is declared bankrupt or insolvent and in case of a limited company, it is

wound up or taken into liquidation.

In the above said contingencies, except under (c) it shall be necessary to give the firm an opportunity of showing cause against the proposed action. Orders removing the firm from the compendium should be communicated to it along with reasons. Orders regarding removal for reasons mentioned in (c) above shall apply for all items for which the firm is registered.

19. APPELLATE AUTHORITY :

The decision of GM i.e. acceptance authority for registration of firms shall be final. However, in case of dispute between firm and factory, Member/TS, OF Board shall be the appellate authority.

20. MONITORING THE PERFORMANCE OF ESTABLISHED SUPPLIERS :

The performance of successful established suppliers after their short-listing by Capacity Verification Team will be monitored regularly against every completed order based on Vendor Rating System. The system shall be used for deciding criterion for input material inspection and subsequently shall be used for vendor selection. Following parameters shall be used for Vendor Rating System:

(i) Quality Rating

(ii) Delivery Rating

(iii) Price Rating

(iii) Service Rating.

Suggested formula of different parameters is as under:

24.1 QUALITY RATING

VRQ = (Q1 + 0.7 * Q2 + 0.3 * Q3 + 0 * Q4)/ Q

Where

Q1 = Quantity Accepted Conforming to Specification,

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Q2 = Quantity accepted with deviation

Q3 = Quantity accepted after rectification

Q4 = Quantity rejected and

Q = Total quantity offered for inspection (Q1 + Q2 + Q3 + Q4 )

24.2 DELIVERY RATING:

VRD = ( Qa / Qc) + { Qb /Qc} * {Tc /Ta} * 0.5,

Where

Qa = Quantity Supplied on Time,

Qc = Quantity Ordered,

Qb = Quantity supplied late beyond delivery period

Tc = Delivery period as per supply order in days,

Ta = Total Time taken to complete the supplies, including late deliveries in number of days.

24.3 PRICE RATING:

VRP = PL / PQ

where PL = Price quoted by the supplier

PQ = Lowest Price quoted by any supplier against that tender.

24.4 SERVICE RATING:

The Index/Score for performance with respect to service will have to be determined jointly by the production/user and the materials management Department.

SERVICE RATING BREAK-UP AS PER IS 12040:2001

PARAMETER MAXIMUM SCORE

Co-operativeness and readiness to help in 30emergencies

Readiness to replace rejected material 20

Providing support documents in time 10

Promptness in reply 10

Co-operation in delivering and implementing 30measures or avoiding recurrence of

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defects/complaints

TOTAL 100

24.5 COMPOSITE INDEX FOR PERFORMANCE OR OVERALL RATING.

VRI = A * VRQ + B * VRD + C * VRP+ D * VRS, Where

A, B, C, D are the weightage for parameters of quality, delivery, Price and service respectively, the values of which are given in succeeding paragraph.

For a particular item, the average vendor rating, AVR, for a supplier over a period of three years will be evaluated by applying the formula:

AVR = (VR1 + VR2 +---- + VRn) /n

Where

‘n’ is the number of orders received by the supplier during the given period for that particular item.

In case an established source fails to secure any order in the last three years, it shall continue to be an established supplier subject to its renewal of registration.

24.6 WEIGHTAGE FACTORS FOR DIFFERENT RATING PARAMETERS:

Following weightage factor is suggested for different parameters as under:

Weightage for Quality - 60%

Weightage for Delivery - 25%

Weightage for Price - 10%

Weightage for Service - 05%

The overall rating of selected established suppliers will be worked out using the above formulae against the orders placed on the firm. The firms getting average overall rating of less than 70% against orders completed in last three years shall not be considered for issue of LTE thereafter for a period of one year. After the reinstatement, their rating will be monitored afresh as above. Second such occasion of rating falling below 70% will permanently disqualify a firm from the status of established suppliers.

21. INSPECTION CATEGORISATION :

Self-Certification category inspection status shall be awarded to Firms securing more than 95% vendor rating apart from other requirements mentioned in SOP for input material Inspection. This categorisation shall be valid for a period of one year. After the expiry of validity period it shall be reviewed again.

For “Inspection at Firm premises” category inspection status, Firm should secure more than 85% marks in vendor rating apart from other requirements mentioned in SOP for input material Inspection.

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“Inspection on receipt” category inspection shall be applied to the firms securing 70% to 85% marks in vendor rating apart from other requirements mentioned in SOP for input material Inspection.

Note: Vendor Rating system shall be stream lined in all the Factories on PPC ONLINE system as per above formulae and shall come in to force with immediate effect. However selection procedure for category of inspection through vendor rating shall be introduced after streamling of vendor Rating through ONLINE PPC system. Till such time the selection of inspection categorisation shall be done as per procedure /criterion given in S.O.P for input material inspection. Separate directives shall be issued by OFB subsequently for the selection of inspection categorisation through vendor Rating system.

APPENDIX- I

INDIAN ORDNANCE FACTORIES

VENDOR REGISTRATION REQUEST FORM(To be filled by Firm)

PART – I ADMINISTRATIVE INFORMATION

1. NAME OF THE COMPANY/VENDOR………………………………………………………………………………………………

………………………………………………………………………………………………

2. ADDRESS : (a) REGD. OFFICE :…………………………………………....………………………………………………………………………………………….PIN……………….STD CODE ………………….PH No 1:………...PH. No.2……………………. FAX……………….

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E.MAIL…………………………MOBILE………….

(b) WORKS/FACTORY :

…………………………………….........................………………………………………………………………………………………….PIN………………..STD CODE ………………PH No 1:…………...PH. No.2 …FAX…………………………………...E.MAIL…………………..MOBILE………………..

(In case of works at more than one location, a separate sheet to be attached for page 1 only)

3. ADDRESS OF LOCAL BRANCH/BRANCH OFFICE /SOLE SELLING AGENT ( IF ANY )…………………………………………………………………………………………………………………………………………………….PIN…………………………………...

STD CODE ……………..PH No 1: ……......PH. No.2 ………………….FAX………………….E.MAIL…………………….MOBILE………………

4. DATE OF INCORPORATION OF THE COMPANY/ COMMENCEMENT OF PRODUCTION...………………………………………………………………………………………………

5. NATURE OF COMPANY………………………………………………………………………….( ATTACH RELEVANT COPIES OF INCORPORATION / PARTNERSHIP DEED/ REGISTRATION OF ENTERPRISE )

a. PROPRIETORY b. PVT. LIMITEDc. P.S.U.d. PARTNERSHIP

6. CATEGORY OF INDUSTRY: (a) LARGE SCALE. (Attach relevant registration documents) (b) MEDIUM SCALE (c) SMALL SCALE

7. DETAILS OF REGISTRATION WITH …… ( ATTACH RELEVANT COPIES OF REGISTRATION CERTIFICATE )

a. NSIC/SSI b. DGS&Dc. DGQA d. OTHER DEFENCE DEPARTMENTSe. ANY OTHER ORD. FYS. FOR DIFFERENT PRODUCT

8. NAME OF PROPRIETOR /M.D/PARTNER

NAME………………………………………………………………………………………

ADDRESS ………………………………………………………………………....

……………………………PIN…………………….

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STD CODE ……………PH No 1: …….............PH. No.2………………….FAX……………………E.MAIL……………………MOBILE……………….

9. NATURE OF BUSINESS…………………………………………………………………………………

a. MANUFACTURINGb. SOLE SELLING/AUTHORIZED AGENT

c. TRADER/DEALER/PROCESSOR/REPACKER

10 ETAILS OF CURRENT PRODUCTS & SERVICES

SL. NO.

TYPE DESCRIPTION LICENSED/INSTALLED RANGE/CAPACITY

ANNUAL PRODUCTION FOR PRECEDING TWO

YEARS

( ATTACH PRODUCT LITERATURE & LEAFLET, IF AVAILABLE )

11. DETAILS OF TECHNICAL COLLABORATIONS ( FOREIGN OR INDIGENOUS )

SL. NO.

PRODUCT NAME & ADDRESS OF

COLLABORATOR

YEAR CURRENT OR NOT

12. DETAILS OF MAJOR CUSTOMERS ALONGWITH LIST OF ITEMS SUPPLIED TO INDIVIDUAL CUSTOMER

SL. NO.

NAME & ADDRESS

PRODUCT SUPPLIED

S.O. NO. & DATE DATE OF LAST

SUPPLY

VALUE

PART - II FINANCIAL INFORMATION

13. i. NAME OF BANKERS & ACCOUNT NOS. AND ADDRESS (WITH PHONE NO. STD CODE, PIN, FAX & E-MAIL)

PRINCIPAL BANKER

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TYPE OF ACCOUNT ACCOUNT NO. CREDIT & OVERDRAFT FACILITY & LIMIT

ii. TAN DETAILS TAN NO. ADDRESS OF ASSESSING I.T.O

14. INCOME TAX RETURNS FOR THREE YEARS. 15. VALID LICENSE FOR PRODUCTION

LICENSE NO. DETAILS OF LICENSING AUTHORITY VALIDITY PERIOD VALID FOR PRODUCTS

16. VALID EXCISE REGISTRATION NUMBER

17. VALID STATE/ VAT/ CENTRAL SALES TAX REGISTRATION CERTIFICATE.

18. OWNERSHIP OF FACTORY LAND & BUILDING COMPANY : OWNED/RENTED( ATTACH PROOF OF OWNERSHIP, AGREEMENT DETAILED SITE PLAN OF LAY OUT OF PREMISES CLEARLY DEPICTING AREAS EG. PRODUCTION AREA ( APROX. LOCATION OF PLANT/MACHINERY STORES, BOND ROOM, INSPECTION ETC. ALSO INDICATE BOUNDARY WALL ) Production Area Bond Room Area Inspection Room Area Storage Area Over all Area

19. INDICATE ANNUAL TURNOVER/SALES FOR LAST THREE YEARS AND PRESENT NET WORTH OF THE FIRM & STATUS OF ORDERS IN HAND.

20. AUDITED BALANCE SHEET & PROFIT & LOSS A/C FOR LAST THREE YEARS AND TOTAL ACCUMULATED LOSSES IF ANY.

21. VALUE OF CAPITAL EMPLOYED

22. VALUE OF CURRENT ASSETS ( AS PER BALANCE SHEET)

23. VALUE OF CURRENT LIABILITIES ( AS PER BALANCE SHEET)

24. DETAILS OF HYPOTHECATION

25. RELEVANT INFORMATIONS WITH COMPLETE DETAILS ABOUT SISTER CONCERNS SUBSIDIARIES, IF ANY.

26. SOURCE OF FINANCE WITH BORROWING LIMIT AND BANK GUARANTEE.

27. WHETHER EVER FILED OR PETITION FOR BANKCURRUPCY OR RE-ORGANISATION?

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28. WHETHER DEBARRED FROM GOVERNMENT CONTRACTS/ ORDNANCE FACTORIES?

29. WHETHER TERMINATED FOR CONTRACT NON-PERFORMANCE?

30. WHETHER CHANGED FIRM’S NAME IN LAST 5 YEARS (IF YES DETAILS OF PREVIOUS NAME REGISTRATION NO. & ADDRESS)

PART – III TECHNICAL

31. TOTAL AREA OF FACTORY PREMISES :TOTAL AREA COVERED BOND SPACE(SQR. MTR.) AREA/FLOOR AREANO. OF ROOMS SQR. MTR.

( SQR. MTR.)

32. DETAILS OF ELECTRIC POWER :a) SANCTIONED ………………………………………………...b) INSTALLED …………………………………………………c) STAND BY ARRANGEMENT OF POWER…………………………………

( INDICATE CAPACITY OF GENERATOR )33. DETAILS OF MAN POWER EMPLOYED :

a)TECHNICAL b) ADMINISTRATIVEMANAGERIAL……………………

MANAGERIAL……………………..

SUPERVISORY………………….

ASSTT/CLERICAL………………..

LAB. TECHNICIANS…………….

LABOURERS SKILLED…………

TOTAL…………………………… TOTAL………………….

c) EMPLOYEES WITH DEGREE QUALIFICATION IN TECHNOLOGY/ENGG.

d) EMPLOYEES WITH DIPLOMA QUALIFICATION IN ENGG.

e) EMPLOYEES WITH ITI DIPLOMA IN ANY ENGG. TRADE

34. a) DETAILS OF DEFENCE STORES FOR WHICH REGISTRATION IS SOUGHT :

SL. NO. NOMENCLATURE SPECN. NO. PRODUCTION CAPACITY ……….. ………………………. ………………. ……………………….……….. ………………………. ………………. ……………………….

35. (a) DETAILS OF BOUGHT OUT ITEMS (Component /Sub Assy/ Assy/ Processes) FROM SUB CONTRACTORS :

(Attach copies of agreements, if any)

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SL. MAIN Comp/Assy/Sub Assy/ NAME & ADDRESS OF THENO. EQPT Processes SUB CONTRACTOR

(b) DETAILS OF TESTING/QUALITY CONTROL DONE BY SUB-CONTRACTORS(Attach copies of agreements where applicable)

_______________________________________________________________________SL. MAIN DETAILS OF NAME AND ADDRESS OF AGREEMENTNO. EQPT TEST SUB-CONTRACTOR/LABORATORY (IF ANY)

36. DETAIL OF IMPORTANT FACILITIES & INFRASTRUCTURE AS PER FOLLOWING FORMAT:

(a) PRODUCTION ( Including Heat Treatment, Dies, Jigs & Fixtures, spinning , weaving, wet processing, printing etc. details are to be furnished on type/make of plant, licensed capacity & installed capacity etc.)

(b) SPECIAL PURPOSE M/C (Like NC,EDM), CAD/CAM, ROBOT etc _______________________________________________________________________SL. DESCRIPTION MAKE & QTY DATE OF APPX PERCENTAGENO. OF M/C & MODEL PURCHASE COST DEPRECIATION SPECN PER YEAR

(c) TOOL ROOM, METROLOGY & TEST EQUIPMENTS & FACILITIES:

SL. TYPE OF MAKE QTY DATE OF REQUENCY APPROXNO. INST, MODEL -------------------------- COST GAUGES, PURCHASE CALIBRATION FOR TEST EQPT ** CALIBRATION37. DETAILS OF ITEMS PRODUCED IN LAST 3 YEARS

NAME OF YEAR OF PRODUCTION IN LAST 03 YEARSPRODUCT FIRST MFG. YEAR QTY. SUPPLIES TO………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

38. INDIVIDUAL FLOW PROCESS CHART OF ALL THE ITEMS FOR WHICH REGISTRATION IS REQD. TO BE FURNISHED ATTACH SEPARATE SHEET OF EACH ITEM.

39. BASIS OF ESTIMATED PRODUCTION CAPACITY IN RESPECT OF ITEMS FOR WHICH REGISTRATION IS REQUIRED.

………………………………………………………………………………………………………………………………………………………………………………………………

40. SOURCE OF RAW MATERIAL FOR EACH OF ABOVE ITEMS : ( ATTACH COPIES OF AGREEMENT, IF ANY )

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ITEMS BASIC RAW SOURCE ( INDIGENOUS/ NAMES OF MAJOR MATERIAL IMPORTED ) RAW MATERIAL SUPPLIERS………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

41. DETAILS OF INSPECTION & QUALITY CONTROL OF FACILITIES

a) LAB. EQUIPMENT & NO. OF TRAINED TECH. IN LAB. b) IS THE LAB. ACCREDITED BY N.A.B.Lc) VALID UP TOd) TYPE OF LAB e) ASSISTANCE FROM OR DEPENDENCE ON ANY CENTRAL AGENCY

FOR TESTING/CALIBRATION ETC. ( FURNISHED DETAILS )……………………………………………………………………………………

…………………………………………………………………………………………………………………………………………………………………………

42. IS COMPANY ISO 9001:2000 CERTIFIED (IF YES GIVE DETAILS)

a) DATE OF CERTIFICATIONb) CERTIFYING BODYc) LAST AUDITED ONd) VALID UP TO

43. DETAILS OF R&D FACILITIES AVAILABLE :………………………………………………………………………………………………………………………………………………………………………………………………

44. FUTURE PLAN IF ANY , IN RESPECT OF EXPANSION PROGRAMME / INSTALLATION OF ADDITIONAL MACHINES / FACILITIES & TESTING EQUIPMENT ETC. :………………………………………………………………………………………………………………………………………………………………………………………………

45. (a) DETAILS OF OUTSOURCING OF FACILITIES OF PRODUCTION OR PROCESSING FROM SUB. CONTRACTORS :

( GIVE ITEM WISE OUTSOURCED FACILITY & ATTACH COPIES OF AGREEMENT)

SL. MAIN FACILITY/PROCESS NAME & ADDRESS NO. STORE OF SUB. CONTRACTOR

……………………………………………………………………………………………………….

………………………………………………………………………………..……

……………………………………………………………………………………………… (b) DETAILS OF CAPACITY OF SUB. CONTRACTOR IN RESPECT OF

AREAS OF SUB. CONTRACTING :………………………………………………………………………………………………

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………………………………………………………………………………………………

(c) DETAILS OF TESTING /QUALITY CONTROL DONE BY SUB. CONTRACTOR

SL. MAIN DETAILS NAME OF SUB. CONTRACTOR NO. STORE OF TESTS

46. ATTACH COPY OF VALID POLLUTION CLEARANCE CERTIFICATE FROM DESIGNATED STATUTORY AUTHORITY.

47. COMPANY BROCHURE / CATALOGUE AND LITERATURE TO BE ENCLOSEDNOTE (I) KINDLY NUMBER OR CODIFY THE EXTRA SHEETS & ANNEXURES &

ENSURE THAT DOCUMENTS ARE LINKED PROPERLY ACCORDING TO SL. NOS. IN THIS PROFORMA.

(I) WHEREVER SPACE IS INADEQUATE ATTACH EXTRA SHEETS WITH PROPER LINKING.

(III) ALL SHEETS OF PROFORMA AS WELL AS EXTRA SHEETS & ANNEXURES MUST BE SIGNED AND STAMPED BY VENDOR.

DECLARATIONI/We confirm that the information furnished in Part I , II & III above are correct to the best of my knowledge & belief. In the event of any information given by me/us is found in-correct/false at any time, I/we understand our registration will be cancelled without notice, besides any other appropriate action against me/us.

DATE SIGNATURE (S)

NAME (S) IN CAPITAL LETTERSPLACE

APPENDIX-II

VENDOR QUALITY SURVEY REPORT(TO BE FILLED BY CAPACITY VERIFICATION TEAM)

PART-I QUALITY SYSTEM OF VENDOR

MARKS ALLOTTED

1.QUALITY MANAGEMENT SYSTEM

3

1.1 General requirement1.1.1 Whether the organisation has established, documented, implemented, maintained and continually improves a quality management system in accordance with the requirements of ISO 9000-2000?

1.1.2 Whether the organisation has identified the processes needed for the quality management system, determined the sequence and interaction of these processes, criteria and methods required to ensure the effective operation and control of these processes, ensure the

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availability of information necessary to support the operation and monitoring of these processes, measures, monitors and analyses these processes and implements action necessary to achieve planned results and continual improvement.

2.Management Responsibility

2.1 Management Commitment: Whether the top management is committed to the development of the quality management system.

3

2.2 Customer Focus: Whether the top management ensures that customer needs and expectations are determined considering obligations related to product including regulatory and legal requirements, converted into requirements and fulfilled with the aim of achieving customer satisfaction.

3

2.3 Quality Policy: Has the top management defined its Quality policy? Is it appropriate to the purpose of the organisation, committed to meeting requirements of customers and to continual improvement, provides a framework for establishing and reviewing quality objectives, communicated and understood at appropriate levels in the organisation, reviewed for continuing suitability and controlled?

3

2.4 Planning2.4.1 Quality Objectives: Whether the top management ensures quality objectives needed to meet requirements for product are established at relevant functions and levels within the organization and are measurable and consistent with the quality policy including the commitment to continual improvement

2

2.4.2 Quality Planning: Whether the top management ensures resources needed to achieve the quality objectives are identified, planed and the output of the planning documented.

2

2.5 Administration 52.5.1 Responsibility and Authority: Whether the organization has defined the functions and their interrelations within the organization including responsibilities and authorities and communicated in order to facilitate effective quality management.

2.5.2 Management Representative: Whether the top management has appointed members of the management who have responsibility and authority to ensure establishment and maintenance of quality management system?

2.5.3 Internal Communication: Whether the organization ensures effective communication between its various levels and functions regarding the processes of the quality management system and their effectiveness

2.5.4 Quality Manual : Whether a well defined quality manual has been established maintained and controlled which includes scope , Documented Procedures and processes?

2.5.5 Control of Documents: Whether a well defined documented procedure available for the controlling of Quality Management system documents.

2.5.6 Control of Quality Records: Whether a documented procedure is established/available

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for the identification, storage, retrieval, protection, retention time and disposition of quality records

2.6 Management Review 42.6.1 General: Whether the Top Management reviews the quality management system at planned intervals to ensure its continuing suitability, adequacy and effectiveness.

2.6.2 Review Input: Whether the inputs to the management review include Results of audits, Customer feedback, Process performance and product conformance, Status of preventive and corrective actions, follow up actions from earlier management reviews recorded?

2.6.3 Review Output: Are the outputs from the management review include actions related to Improvement of the quality management system and its processes, products related to customer requirements and resource needs. Are the results from the management reviews recorded?

3.0Resource Management

5

3.1 Provision of Resources: Has the organisation determined and provided in a timely manner the resources needed to implement and improve the processes of the quality management system and to address customer satisfaction?

3.2 Human Resources 43.2.1 Assignment of Personnel: Whether the Personnel assigned responsibilities defined in the quality management system are competent on the basis of applicable education, training, skills and experience.

3.2.2 Training, Awareness and Competency: Whether the organisation has established a system for identifying competency needs of personnel and provide training, Evaluate the effectiveness of the training provided, and maintain appropriate records of education, experience, training and qualifications of its personnel?

3.2.3 Facilities: Has the organisation identified, provided and maintained facilities such as Workspace, Equipment, hardware and software and supporting services it needed to achieve the conformity of product?

3.2.4. Work Environment: Whether the organisation has a system for identification and management of human and physical factors of the work environment needed to achieve conformity of product.

4.0Product Realisation

5

4.1 Planning of Realization Processes: Whether the organisation has determined Quality objectives for the product, project or contract, processes and documentation, resources and facilities specific to the product verification and validation activities, the criteria for acceptability, and records that are necessary to provide confidence of conformity in the process planning for product realization.

4.2 Customer Related Process 5

4.2.1 Identification of Customer Requirements: Whether the organisation has established

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a system for determining customer requirements with regard to quality, availability, delivery and support, intended unspecified requirements and to meet regulatory and legal requirements.

4.2.2 Review of Product Requirements: Whether the organisation reviews the identified and additional customer requirements and ensures that Product requirements are defined, unstated customer requirements are confirmed before acceptance, discrepancies between contract and a tender are resolved, products/services meet defined requirements and records available of the reviews and subsequent follow up actions.

4.2.3 Customer Communication: Whether the organization identifies and implements arrangements for communication with customers relating to:

1 4.2.3.1 Product information

2 4.2.3.2 Enquiries, contracts or order handling, including amendments

3 4.2.3.3 Customer feedback, including customer complaints

4.3 Design and / or Development 154.3.1 Design and / or Development Planning

4.3.1.1 4.3.1.1 Whether the organization plans and controls design and/or development of the product by determining/verifying stages of design and /or development process, Validation activities appropriate to each design and/or development stage Responsibilities and authorities for design and/or development activities.

2 4.3.1.2 Are the Interfaces between different groups involved in design and /or developments are managed to ensure effective communication and clarity of responsibilities.

3 4.3.1.3 Is the Planning output updated as appropriate as the design and/or development progresses.

4.3.2 Design and / or Development Inputs4.3.2.1 4.3.2.1 Whether the Inputs relating to product requirements have been defined and

documented.

4.3.2.2 4.3.2.2 Are the inputs reviewed for adequacy and incomplete, ambiguous or conflicting requirements resolved.

4.3.3 Design and /or Development Outputs: Whether the outputs of the design and /or development process documented in a manner and enables verification against the design and /or development inputs. Are the Design and/or development output documents approved prior to release? 4.3.4 Design and / or Development Review

4.3.4.1 4.3.4.1 Whether, systematic reviews of design and / or development conducted at suitable stages.

4.3.4.2 4.3.4.2 Are the participants in such reviews including representatives of function concerned with the design and /or development stage(s) being reviewed

4.3.4.3 Are the results of the reviews and subsequent follow-up actions recorded and records made available.

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4.3.5 Design and/ or Development Verification:

4.3.5.1 Are Design and/or development verification performed to ensure the output meets the design and/ or development inputs?

4.3.5.2 Are the results of the verification and subsequent follow-up actions recorded?

4.3.6 Design and/ or Development Validation:4.3.6.1 Whether Design and/ or development validation performed to confirm that resulting product is capable of meeting the requirement for intended use.

4.3.6.2 Whether validation completed prior to the delivery or implementation of the product where applicable.

4.3.6.3 Whether partial validation performed wherever it is impractical to perform full validation prior to delivery or implementation.

4.3.6.4 Are the results of the validation and subsequent follow-up actions recorded?

4.3.7 Control of Design and/ or development Changes4.3.7.1 Whether design and/ or development changes identified, documented and controlled and include evaluation of the effect of the changes on constituent parts and delivered products.

4.3.7.2 Are the changes verified and validated as appropriate and approved before implementation and results of the review of changes and subsequent follow up actions documented.

4.4 Purchasing 54.4.1 Purchasing Control4.4.1.1 Existence of effective control on purchasing processes to ensure purchased product conforms to requirements.

4.4.1.2 Whether the organisation evaluates and selects suppliers based on their ability to supply products in accordance with the organisation’s requirements, whether the criteria for selection and periodic evaluation are defined and the results of evaluations and follow-up actions recorded.

4.4.2 Purchasing Information4.4.2.1 Whether the Purchasing documents contain information describing the product to be purchased.

4.4.2.2 Whether the organization identifies and implements the activities necessary for verification of purchased product.

4.4.3 Verification of Purchased Product

4.4.3.1 Whether the organization has specified the intended verification arrangements and methods of product release in the purchasing information whenever the organization or its

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customer proposes to perform verification activities at the supplier’s premises

4.5 Production and Service Operations5

4.5.1 Operation Control: Whether the organization has arrangements for Controlling production and service operations through specifying product characteristics, making available work instructions, use and maintenance of suitable equipment implementing monitoring activities.

4.5.2 Identification and Trace-ability

4.5.2.1 Whether the organization has a system for identifying, where appropriate, the product by suitable means throughout production and service operations, and the status of the product with respect to measurement and monitoring requirements.

4.5.2.2 Whether the organization has controlling and recording system for unique identification of the product, where Trace-ability is requirement.

4.5.3 Customer Property: Whether the organization exercises care with customer property while it is under the organization’s control, identifies, verifies, protects and maintains customer property provided for use or incorporation into the product and records and reports to the customer any customer property that is lost/damaged.

4.5.4 Preservation of Product : Whether the organization preserves conformity of product with customer requirements during internal processing and delivery to the intended destination.

4.5.5 Validation of Processes

4.5.5.1 Whether the organization validates any production and service processes where the resulting output cannot be verified by subsequent measurement or monitoring.

4.5.5.2 Whether the Validation demonstrates the ability of the processes to achieve planned results.

4.5.5.3 Whether the organisation has defined arrangements for validation that includes Qualification of processes, equipment and personnel, methodologies and procedures records and re-validation.

4.6 Control of Measuring and Monitoring Devices 54.6.1 Whether the organisation has identified the measurements to be made and the measuring and monitoring devices required to assure conformity of product to specified requirements.

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4.6.2. Are measuring and monitoring devices used and controlled to ensure that measurement capability is consistent with the measurement requirements.

4.6.3 Are measurement and monitoring devices, where applicable, calibrated and adjusted periodically or prior to use against devices traceable to international or national standards, safeguarded from adjustment that would invalidate the cablibration protected from damage and deterioration during handling, maintenance and storage results re-assessed if they are subsequently found to be out of calibration and corrective action taken.

5.0Measurement, Analysis and Improvement

5

5.1 Planning: Has the organisation defined, planned and implemented the measurement and monitoring activities needed to assure conformity and achieve improvement including the determination of the need for and use of applicable methodologies including statistical techniques.

5.2 Measurement and Monitoring10

5.2.1 Customer Satisfaction

5.2.1.1 Whether the organisation monitors information on customer satisfaction and/ or dissatisfaction as one of the measurements of performance of the quality management system.

5.2.1.2 Are the methodologies for obtaining and using this information determined?

5.2.2. Internal Audit

5.2.2.1 Whether the organisation conducts periodic internal audits to determine whether the quality management system conforms to the requirements of this standard, and it has been effectively implemented and maintained.

5.2.2.2 Whether the audit plans take into consideration the status and importance of the activities and areas to be audited as well as the results of previous audits, defines the audit scope, frequency and methodologies conducted by personnel other than those who perform the activity being audited.

5.2.2.3 Whether a documented procedure for conducting audits available.

5.2.2.4 Whether the management takes timely corrective action on deficiencies found during the audit and follow-up action including the verification of the implementation of corrective action and the reporting of verifications results.

5.2.3 Measurement and Monitoring of Processes

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5.2.3.1 Whether the organization applies suitable methods for measurement and monitoring of those realization processes necessary to meet customer requirements.

5.2.3.2 Are these methods confirming the continuing ability of each process to satisfy its intended purpose ?

5.2.3.3 Whether evidence of conformity with the acceptance criteria documented .

5.2.3.4 Whether the records indicate the authority responsible for release of product.

5.2.3.5 Whether Product releases and service delivery do not proceed until all the specified activities are satisfactorily completed unless otherwise approved by the customer.

5.3 Control of Non-conformity5

5.3.1 Whether the organization ensures identification of non-conforming products, which do not conform to requirements and controlled to prevent unintended use or delivery and these activities are defined in a documented procedure.

5.3.2 Whether the organization takes appropriate action regarding the consequences of the nonconformity when nonconforming product is detected after delivery or use has started.

5.3.3 Whether the organization reports for concession to the customer, the end user, regulatory body or other body .The proposed rectification of nonconforming product where required.

5.4 Analysis of Data: Whether the organization collects and analyses appropriate data to determine the suitability and effectiveness of the quality management system and to identify improvement s that can be made.

2

5.5 Corrective Action : Whether the organization takes corrective action to eliminate the cause of non-conformities in order to prevent recurrence and documented the procedure for corrective action.

2

5.6 Preventive Action: Whether the organisation has identified preventive action to eliminate the cause of potential non-conformities to prevent occurrence and documented the procedure for preventive action

2

TOTAL MARKS 100

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APPENDIX-IIPART - II

VENDOR QUALITY SURVEY REPORT (VQSR)(TO BE FILLED BY CAPACITY VERIFICATION TEAM)

PART –II PRODUCT SPECIFIC TECHNICAL CAPABILITY OF VENDORS

1. MANUFACTURING PLANT & MACHINCERY MARKS ALLOTTED

1.1 Whether essential Plant & Machinery are available for the product range under consideration to the required specification. (Enclose list with capacity verification report)

35

1.2 Whether desirable Plant & Machinery for the product are available. (Enclose list with capacity verification report)

10

1.3 Whether the Plant and Machinery is adequately sophisticated/state of the art technology as relevant to the product requirements. Give brief details to support assessment. (Enclose list with capacity verification report)

10

2. MANUFACTURING PROCESS: 2.1 Availability of all manufacturing operations and process in –

house. (These include all process/operations required to be performed on the raw materials, for conformity of end product to required applications including packing, marking, handling and storage/delivery).

10

2.2 Whether the available process capability is adequate and compatible with the product specific requirements.

5

3. TESTING

3.1 Whether essential test equipment for all quality control and measurements are available in – house.

(Enclose list with capacity verification report)

10

3.2

3.3

Whether desirable test equipment are available as per laid down norms.

(Enclose list with capacity verification report)

Whether Firm has NABL Accredited Lab

5

15

4. IN – HOUSE QUALITY CONTROL

4.1 Whether there is adequate quality plan to meet the technical specifications and check product related requirements at all stages during the manufacturing process as adopted to the product.

10

4.2 Whether in – process inspection and testing is systematically carried out as per the quality plan and data is recorded as adopted to the product.

10

4.3 Whether in – house controls as per quality plant adequate to 5

159

ensure product conformance. 4.4 Whether performance of machines instruments, jigs, fixtures,

gauges and operations is monitored during the manufacturing process.

5

5. MANPOWER RESOURCES: 5.1 Whether personnel assigned manufacturing responsibilities are

adequate in number and have requisite qualifications/experience and expertise for product.

(Team must verify the VQSR point No. 35)

5

5.2 Whether personnel assigned quality control responsibility are adequate in number and have requisite expertise and authority for the product.

5

6. ADEQUACY OF INFRASTRCUTURE FACILITIES:

6.1. Covered and open space for manufacturing facilities. 5

6.2 Bond Rooms commensurate to the stores and quantum of supplies and its security.

5

6.3 Maintenance set – up for the in – house plant/machinery and test equipment.

5

6.4 Inspection facilities 5

7. POWER SUPLY:

7.1 Availability of stand – by power arrangement and its adequacy. 5

7.2 Availability of adequate water arrangement. 5

8. GENERAL:

8.1 Lighting and Ventilation. 5

8.2. Hygiene and Sanitation of the firm and surrounding area 5

8.3 Fire fighting arrangements 5

8.4 First aid and Medical arrangements 5

8.5 Approach to firm 5

8.6 ECO – friendly waste disposal 5

PART – II TOTAL MARKS 200 MARKS OBTAINED

ASSESSMENT TOTALMARKS MARKS OBTAINEDPART – I 100PART – II 200GRAND TOTAL 300

160

NOTE: Grading of Firms based on capacity assessment from:

TOTAL MARKS OBTAINED IN PART – I & II

Maximum Marks = 300

If firm scores > 225 marks Grade I180 to 224 Grade II150 to 179 Grade III<150 Firm not considered for Registration

Date of visit to the firm

Signature of Members of Assessment Team Rank and Name Signature with date1.2.

161

Appendix “III”

162

Appendix “ IV “

REGISTRATION CERTIFICATE

This is to certify that M/s _______________________________after verification of their capacity / capability are Registered vide registration No.__________________________dated________________ and are found capable of manufacturing of the following items for defence.

---------------------------------------------------------------------------------------------------Sl.No. Nomenclature and details Specifications Of the store(s)------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

( attach on separate sheet as Annexure if required)---------------------------------------------------------------------------------------------------

No. of items for which registered : _________________________only

Vendor Code :(28 digits as per para 16)Grading of the Vendor :

This Certificate is valid upto :

This Certificate is issued subject toConditions indicated overleaf :

( )Date_________________ Jt. GM/QC

For. GM

163

Condition of Registration

1. Please apply for renewal of registration on the prescribed form at least 180 days before expiry of this certificate.

2. In case no application for renewal is received on the prescribed form with in stipulated time as stated above your registration will lapse and the name of your firm will be automatically removed from the compendium of approved suppliers without any further notice.

3. Changes, if any, in address or constitution of the firm, major machinery / equipment or technology used for the items registered should be intimated to the Registration Authority immediately on occurrence.

4. The Approving Authority reserves the right to cancel this Registration

Certificate at any time during the validity of the Certificate.

164

Appendix “ V “

Reference No. _____________________________ Date

From M/s ____________________________

____________________________

To Concerned GM

Subject : APPLICATION FOR RENEWAL OF REGISTRATION Dear Sir, Kindly refer to our Registration Certificate No. _________________

_______________ dated _______________________ which is due to expire on

_________________________.

2. As per the conditions of registration, we hereby apply for renewal of our registration for a further period of 3 years.

3. The renewal of registration may be done for ________________ items for which we are already registered. We may also be assessed for _________________ additional items as per details given in Annexure attached.

4. Latest updated information in respect of our firm along with related documents is attached at Annexure to this application.

Yours faithfully

Signature of Authorised Signatory/Representative of firm along with seal.

165

Annexure to Appx “ V “

(Annexure to Application for Renewal of Registration)

Part I - GENERAL INFORMATION

1. Name of Firm: - ________________________________________

2. Office Address: - ________________________________________ ________________________________________ Telephone No. ____________________ FAX______________________

3. Factory Address ________________________________________ ________________________________________ Telephone No. ____________________ FAX______________________

4. (a) Is there change in address from last registration. Yes / No (b) If so, give reasons for change (Attach relevant documents of ownership or rent / lease deed and rent receipts) .

5. Changes if any in the management or constitution of the firm. (If so, give details and attach relevant documents)

6. Changes if any, in the numbers and qualifications/experience of permanent personnel employed for production and quality control/ testing. If so, attach details separately for each.

7. Changes, if any, in the availability of covered accommodation and open area available including, bond rooms and inspection facilities.

8. Changes, if any, in the financial state of firm including availability of bank finance.

9. Following documents are attached:

a) Certified copies of latest audited balance sheetsand profit and Loss Account for last 3 Years.

b) TAN details c) Income Tax return for last 3 yearsd) Copy of Latest SSI Regn Certificate (for SS units) or

Factory Regn No (for large/medium scale units)

PART II - TECHNICAL INFORMATION

1) Details of nomenclature and capacity of items forWhich firm was last registered. (Attach separate sheet if required)

2) Changes, if any, in production facilities, viz., availability of plant/machinery and process for production, since

last registration.

3) Changes in technology or design of products

166

for which already registered. If so, give flow chart and basis for revised capacity (if required).

4) Changes in in-house laboratory equipment/testing and Drawing facilities, office/design, if any, since lastRegistration. If so, give details of changes in testing/Quality control / design capabilities.

5) In case, arrangements for bought out productionProcesses and quality control testing facilities havebeen permitted during last registration, give detailsof changes in these, if any.

6) Changes, if any, in arrangements for procurement oror sub-contracting for raw materials or components/Sub-assemblies/ processes since last registration.

7) Additional items, if any, for which registration issought now. Give details of nomenclature andspecifications and production capacity for each.

8) In case additional items for registration have beenapplied for in column. 7 above, please giveFollowing details / information –(a) Whether same/different technology is involved

(b) If technology involved is different, indicate :-(i) Details of plant and machinery available for

additional items.

(ii) Details of Quality Control / Test Equipment

(iii) Production Flow Chart (iv) Quality Plan

(v) Basis for proposed production capacity for each item.

9) Details of Supply Orders from Ordnance Factories received/Executed fully or partly (with reasonsfor part / non-execution)during the Last 3 years :-

S/No. SO NO Order Nomenclature Value Date of & Date placed by of store Completion/ reasons for non/part execution

1. Your comments, if any, to justify renewalof registration for a further period of 3 years

167

2. Assessment fee has been deposited Vide___________dated ___________(if applicable)

Certified that the information given in Parts I and II above is correct to the best of our knowledge and belief. In the event of any information given by us is found to be incorrect / false at any time, we fully understand that our registration will be cancelled without notice, besides any other appropriate action against us.

Place : Signature of authorisedSignatory/representative

ofthe firm with Seal.

Date :

Enclosures : ____________nos. Details as per Index attached.

Notes1. Information given in Part I and Part II should be related to the information given

at the time of last registration, as applicable.2. Where necessary, details may be given on separate sheets attached.3. All relevant documents and separate sheets may be serially numbered and

indexed properly.4. Assessment fee is to be paid in case of change of location of firm or existing/

additional items to be renewed for registration against new technology.

168

Guide for APPENDIX- I(Guide for Initial Assessment – Not to be given to Firm)

INDIAN ORDNANCE FACTORIES

VENDOR REGISTRATION REQUEST FORM

PART – I ADMINISTRATIVE INFORMATION

1. NAME OF THE COMPANY/VENDOR………………………………………………………………………………………………

………………………………………………………………………………………………

2. ADDRESS : (a) REGD. OFFICE :…………………………………….............................……………………………………………………….………………………………….PIN………………..STD CODE ………………….PH No 1: …………..PH. No.2……………….. ……...FAX………………E.MAIL…………………………MOBILE…………

(b) WORKS/FACTORY :

……………………………………………………....………………………………………………………………………………………….PIN………………..STD CODE ………………….PH No 1: ………...PH. No.2 …………………FAX…………………...E.MAIL……………………MOBILE………………

(In case of works at more than one location, a separate sheet to be attached for page 1 only)

3. ADDRESS OF LOCAL BRANCH/BRANCH OFFICE /SOLE SELLING AGENT ( IF ANY )

……………………………………………………………………………………………………………………………………………….PIN………………..STD CODE ………………….PH No 1: ………...PH. No.2 ………………………AX………………...E.MAIL…………………………MOBILE…………

4. DATE OF INCORPORATION OF THE COMPANY/ COMMENCEMENT OF PRODUCTION

………………………………………………………………………………………………

5. NATURE OF COMPANY………………………………………………………………………….

( ATTACH RELEVANT COPIES OF INCORPORATION / PARTNERSHIP DEED/ REGISTRATION OF ENTERPRISE )

b. PROPRIETORY b. PVT. LIMITEDc. P.S.U.e. PARTNERSHIP

169

6. CATEGORY OF INDUSTRY: (a) LARGE SCALE. (Attach relevant registration documents)

(b) MEDIUM SCALE

(c) SMALL SCALE

7. DETAILS OF REGISTRATION WITH …… ( ATTACH RELEVANT COPIES OF REGISTRATION CERTIFICATE )

Registered with any one of the following: 10 Registered with 2 or more of following: 15

f. NSIC/SSI g. DGS&Dh. DGQA i. OTHER DEFENCE DEPARTMENTSj. ANY OTHER ORD. FYS. FOR DIFFERENT PRODUCT

8. NAME OF PROPRIETOR /M.D/PARTNER

NAME………………………………………………………………………………………

ADDRESS …………………………………………………....

………………………………………………………………………………………….PIN………………..STD CODE ………………….PH No 1: ………...PH. No.2 ………………FAX……………………...E.MAIL…………………MOBILE…………………

9. NATURE OF BUSINESS…………………………………………………………………………………

d. MANUFACTURING 30e. SOLE SELLING/AUTHORIZED AGENT 10

f. TRADER/DEALER/PROCESSOR/REPACKER 0

10. DETAILS OF CURRENT PRODUCTS & SERVICES If Critical components are being produced 20

Other components 10TRADING 0

SL. NO.

TYPE DESCRIPTION LICENSED/INSTALLED RANGE/CAPACITY

ANNUAL PRODUCTION FOR PRECEDING TWO

YEARS

( ATTACH PRODUCT LITERATURE & LEAFLET, IF AVAILABLE )

170

11. DETAILS OF TECHNICAL COLLABORATIONS ( FOREIGN OR INDIGENOUS )

SL. NO.

PRODUCT NAME & ADDRESS OF

COLLABORATOR

YEAR CURRENT OR NOT

12. DETAILS OF MAJOR CUSTOMERS ALONGWITH LIST OF ITEMS SUPPLIED TO INDIVIDUAL CUSTOMER

SL. NO.

NAME & ADDRESS

PRODUCT SUPPLIED

S.O. NO. & DATE DATE OF LAST

SUPPLY

VALUE

ReputedCustomers 10

PART - II FINANCIAL INFORMATION

13. i. NAME OF BANKERS & ACCOUNT NOS. AND ADDRESS (WITH PHONE NO. STD CODE, PIN, FAX & E-MAIL)

PRINCIPAL BANKER TYPE OF ACCOUNT ACCOUNT NO. CREDIT & OVERDRAFT FACILITY & LIMIT

iii. TAN DETAILS TAN NO. ADDRESS OF ASSESSING I.T.O

14. INCOME TAX RETURNS FOR THREE YEARS. 15. VALID LICENSE FOR PRODUCTION

LICENSE NO. DETAILS OF LICENSING AUTHORITY VALIDITY PERIOD VALID FOR PRODUCTS

16. VALID EXCISE REGISTRATION NUMBER

17. VALID STATE/ VAT/ CENTRAL SALES TAX REGISTRATION CERTIFICATE.

171

18. OWNERSHIP OF FACTORY LAND & BUILDING COMPANY : OWNED/RENTED( ATTACH PROOF OF OWNERSHIP, AGREEMENT DETAILED SITE PLAN OF LAY OUT OF PREMISES CLEARLY DEPICTING AREAS EG. PRODUCTION AREA ( APROX. LOCATION OF PLANT/MACHINERY STORES, BOND ROOM, INSPECTION ETC. ALSO INDICATE BOUNDARY WALL ) Production Area Bond Room Area Inspection Room Area Storage Area Over all Area

19. INDICATE ANNUAL TURNOVER/SALES FOR LAST THREE YEARS AND PRESENT NET WORTH OF THE FIRM & STATUS OF ORDERS IN HAND.

YEAR TURNOVER (Rs.)

ANNUAL TURNOVER >50 Cr 20>10 Cr 15

>2 Cr 10<2 Cr. 0

20. AUDITED BALANCE SHEET & PROFIT & LOSS A/C FOR LAST THREE YEARS AND TOTAL ACCUMULATED LOSSES IF ANY.

21. VALUE OF CAPITAL EMPLOYEDMore than Rs. 20 Cr. 20Between 10 Cr. to 20 Cr. 15Between 3 cr. to 10 Cr 10Between 50 L. to 3 Cr 05Less than Rs. 50L. 00

25. VALUE OF CURRENT ASSETS ( AS PER BALANCE SHEET)

26. VALUE OF CURRENT LIABILITIES ( AS PER BALANCE SHEET)

27. DETAILS OF HYPOTHECATION

28. RELEVANT INFORMATIONS WITH COMPLETE DETAILS ABOUT SISTER CONCERNS SUBSIDIARIES, IF ANY.

29. SOURCE OF FINANCE WITH BORROWING LIMIT AND BANK GUARANTEE.

30. WHETHER EVER FILED OR PETITION FOR BANKCURRUPCY OR RE-ORGANISATION?

31. WHETHER DEBARRED FROM GOVERNMENT CONTRACTS/ ORDNANCE FACTORIES?

32. WHETHER TERMINATED FOR CONTRACT NON-PERFORMANCE?

33. WHETHER CHANGED FIRM’S NAME IN LAST 5 YEARS (IF YES DETAILS OF PREVIOUS NAME REGISTRATION NO. & ADDRESS)

172

PART – III TECHNICAL34. TOTAL AREA OF FACTORY PREMISES :

TOTAL AREA COVERED BOND SPACE(SQR. MTR.) AREA/FLOOR AREA NO. OF ROOMS SQR. MTR.

( SQR. MTR.)

35. DETAILS OF ELECTRIC POWER :a) SANCTIONED ………………………………………………………..b) INSTALLED ………………………………………………c) STAND BY ARRANGEMENT OF POWER……………………………………

( INDICATE CAPACITY OF GENERATOR )

Captive Power availability 10

36. DETAILS OF MAN POWER EMPLOYED :a) TECHNICAL b) ADMINISTRATIVE

MANAGERIAL……………………

MANAGERIAL……………………..

SUPERVISORY………………….

ASSTT/CLERICAL………………..

LAB. TECHNICIANS…………….

LABOURERS SKILLED…………

TOTAL………………… TOTAL…………………> 100

10 > 50 5

c) EMPLOYEES WITH DEGREE QUALIFICATION IN TECHNOLOGY/ENGG. 10

d) EMPLOYEES WITH DIPLOMA QUALIFICATION IN ENGG.

e) EMPLOYEES WITH ITI DIPLOMA IN ANY ENGG. TRADE

37. a) DETAILS OF DEFENCE STORES FOR WHICH REGISTRATION IS SOUGHT :

SL. NO. NOMENCLATURE SPECN.NO. PRODUCTION CAPACITY

………. ……………………. …………….. ………………………….………. ……………………. …………….. …………………………….………. ……………………. …………….. …………………………….

38. (a) DETAILS OF BOUGHT OUT ITEMS (Component /Sub Assy/ Assy/ Processes) FROM SUB CONTRACTORS :

(Attach copies of agreements, if any)

SL. MAIN Comp/Assy/Sub Assy/ NAME & ADDRESS OF THENO. EQPT Processes SUB CONTRACTOR

173

(b) DETAILS OF TESTING/QUALITY CONTROL DONE BY SUB-CONTRACTORS

(Attach copies of agreements where applicable)_______________________________________________________________________________ SL. MAIN DETAILS OF NAME AND ADDRESS OF AGREEMENTNO. EQPT TEST SUB-CONTRACTOR/LABORATORY (IF ANY)

39. DETAIL OF IMPORTANT FACILITIES & INFRASTRUCTURE AS PER FOLLOWING FORMAT:

(a) PRODUCTION ( Including Heat Treatment, Dies, Jigs & Fixtures, spinning , weaving, wet processing, printing etc. details are to be furnished on type/make of plant, licensed capacity & installed capacity etc.)

(b) SPECIAL PURPOSE M/C (Like NC,EDM), CAD/CAM, ROBOT etc _______________________________________________________________________________SL. DESCRIPTION MAKE & QTY DATE OF APPX PERCENTAGENO. OF M/C & MODEL PURCHASE COST DEPRECIATION SPECN PER YEAR

(c) TOOL ROOM, METROLOGY & TEST EQUIPMENTS & FACILITIES:

SL. TYPE OF MAKE QTY DATE OF FREQUENCY APPROXNO. INST, MODEL -------------------------- COST GAUGES, PURCHASE CALIBRATION FOR TEST EQPT ** CALIBRATION

40. DETAILS OF ITEMS PRODUCED IN LAST 3 YEARSNAME OF YEAR OF PRODUCTION IN LAST 03 YEARSPRODUCT FIRST MFG. YEAR QTY. SUPPLIES TO………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

41. INDIVIDUAL FLOW PROCESS CHART OF ALL THE ITEMS FOR WHICH REGISTRATION IS REQD. TO BE FURNISHED ATTACH SEPARATE SHEET OF EACH ITEM.

42. BASIS OF ESTIMATED PRODUCTION CAPACITY IN RESPECT OF ITEMS FOR WHICH REGISTRATION IS REQUIRED.

………………………………………………………………………………………………

174

………………………………………………………………………………………………

43. SOURCE OF RAW MATERIAL FOR EACH OF ABOVE ITEMS : ( ATTACH COPIES OF AGREEMENT, IF ANY )

ITEMS BASIC RAW SOURCE ( INDIGENOUS/ NAMES OF MAJOR MATERIAL IMPORTED ) RAW MATERIAL SUPPLIERS

………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

44. DETAILS OF INSPECTION & QUALITY CONTROL OF FACILITIES

a) LAB. EQUIPMENT & NO. OF TRAINED TECH. IN LAB. 10 b) IS THE LAB. ACCREDITED BY N.A.B.L YES 10e) VALID UP TOf) TYPE OF LAB e) ASSISTANCE FROM OR DEPENDENCE ON ANY CENTRAL AGENCY

FOR TESTING/CALIBRATION ETC. ( FURNISHED DETAILS )……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

45. IS COMPANY ISO 9001:2000 CERTIFIED (IF YES GIVE DETAILS)5

(a) DATE OF CERTIFICATION(b) CERTIFYING BODY

(c ) LAST AUDITED ON(d) VALID UP TO

46. DETAILS OF R&D FACILITIES AVAILABLE : 10………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

47. FUTURE PLAN IF ANY , IN RESPECT OF EXPANSION PROGRAMME / INSTALLATION OF ADDITIONAL MACHINES / FACILITIES & TESTING EQUIPMENT ETC. :………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

48. (a) DETAILS OF OUTSOURCING OF FACILITIES OF PRODUCTION OR PROCESSING FROM SUB. CONTRACTORS :

( GIVE ITEM WISE OUTSOURCED FACILITY & ATTACH COPIES OF AGREEMENT)

SL. MAIN FACILITY/PROCESS NAME & ADDRESSNO. STORE OF SUB. CONTRACTOR

……………………………………………………………………………………………………….

………………………………………………………………………………..……

175

……………………………………………………………………………………………… (b) DETAILS OF CAPACITY OF SUB. CONTRACTOR IN RESPECT OF AREAS OF SUB. CONTRACTING :

………………………………………………………………………………………………

………………………………………………………………………………………………

(c) DETAILS OF TESTING /QUALITY CONTROL DONE BY SUB. CONTRACTOR

SL. MAIN DETAILS NAME OF SUB. CONTRACTOR NO. STORE OF TESTS

49. ATTACH COPY OF VALID POLLUTION CLEARANCE CERTIFICATE FROM DESIGNATED STATUTORY AUTHORITY.

50. COMPANY BROCHURE / CATALOGUE AND LITERATURE TO BE ENCLOSED

NOTE (I) KINDLY NUMBER OR CODIFY THE EXTRA SHEETS & ANNEXURES & ENSURE THAT DOCUMENTS ARE LINKED PROPERLY ACCORDING TO SL. NOS. IN THIS PROFORMA.

(II) WHEREVER SPACE IS INADEQUATE ATTACH EXTRA SHEETS WITH PROPER LINKING.

(III) ALL SHEETS OF PROFORMA AS WELL AS EXTRA SHEETS & ANNEXURES MUST BE SIGNED AND STAMPED BY VENDOR.

DECLARATION

I/We confirm that the information furnished in Part I , II & III above are correct to the best of my knowledge & belief. In the event of any information given by me/us is found in-correct/false at any time, I/we understand our registration will be cancelled without notice, besides any other appropriate action against me/us.

DATE SIGNATURE (S)

NAME (S) IN CAPITAL LETTERS

PLACE

NOTE: Qualification of Firms based on assessment from above form:

Maximum Marks = 200If firm scores > 80 marks: Qualified for capacity verification

176

If firm scores <80 marks: Firm not considered for Registratio

177

Notes

1. Information given in Parts I and II should be related to the information given at the time of last registration, as applicable.

2. Where necessary, details may be given on separate sheets attached.

3. All relevant documents and separate sheets may be serially numbered and indexed properly.

4. Assessment fee is to be paid in case of change of location of firm or existing / additional items to be renewed for registration against new technology.

178

Annexure-57 No.14/4/LP/POLICY/MM/P&C

Government of India, Ministry of Defence,

Ordnance Factory Board, 10-A, S.K.Bose Road, Kolkata-700001. Dated 10th November,2005.

To, The Sr. General Manager/ General Manager.

Sub: Procurement of stores on the basis of single vendor system.

M of D has been emphasizing the need for a policy guideline on issues like efforts made for developing/ locating alternate source, determining price reasonability in cases of procurements where only single vendor quotes or where tender is issued to single firm. The subject has been examined in OFB and it has been decided that the following guidelines are to be followed in all single tender purchase cases.

1. It should be ensured in all single tender cases that vendors for the same or similar items registered with sister ordnance factories are also consulted and wherever possible budgetary quote obtained.

2. In the case of vehicle components or similar illustrated spare part list (ISPL) are available from the manufacturer, a technical committee should be set up in the factory to assess the cost of the item on the basis of nature of material(s), production methodology and value addition. The team should be multi-disciplinary and should incorporate a representative from finance also. While arriving at cost of material relevant indices for virgin metal and alloys must be referred with reference to published indices and indicated as such in the report.

3. Another method of establishing the price would be with reference to the last purchased rate in the factory, similar rates for same or similar items in sister ordnance factories and published data from the trade with reference to indices, etc. as referred to earlier.

4. In the case of foreign supplies, to the extent possible, published data available in internet should also be taken into account.

5. If no last purchase price is available, a break-up of the price quoted (Material, Labour, Overhead, profit) may be obtained from the firm and data analysed to take a view as regards the reasonableness or otherwise of the price quoted. Comparison may also be made with the price of similar stores. If necessary, a technical assessment of cost may also be undertaken having regard to the material required, its quantum, operations and processing involved etc.

179

6. Minutes of TPC must include details of deliberations held regarding measures taken for establishing new sources and how the reasonableness of cost was arrived at.

7. Cost analysis is essential in all cases of purchase in single tender purchase basis. Technically qualified officers must make adequate attempts to arrive at reasonableness of price in consultation with finance representative and wherever considered essential, assistance of Advisor Cost of MOD should also be obtained. In this connection OFB letter no 01/6/PROV/VIG/MM (P&C) dated

8.8.2005 may also be referred. GMs to please note that before sending any single tender purchase case

to OFB/ M of D, thorough scrutiny as per above guidelines must be done.

GMs shall also review all single tender and development cases on a quarterly basis along with finance head in the factory.

It is requested that the above guidelines be brought to the notice of all officers of the factory for strict compliance.

(S.Kolay)DDG/MM (K) For D.G.O.F.

180