PM purchase policy Flashcards
primary objective is to procure plant and equipment, spares and other stores and materials required by indentors with a view to:
a) Helping and maintaining continuity of production by correct supplies as per users requirement, in time.
b) Ensuring that items purchased are most economical, taking into account their quality, durability, efficiency etc.
c) Developing effective and on-going vendor relationships to ensure fair play and equity.
The materials obtained shall be :
a) Of right quality:
b) In right quantity:
c) At the right time:
d) At right prices:
e) From right sources.
Purchases will be arranged in the following ways :
a) Following are the recommended modes of tendering for placement of orders: tendering
i) Domestic Open Tender(advertised)
ii) GlobalTender(advertised)
iii) Limited Tender
iv) Single Enquiry for proprietary and non-proprietary items.
v) Direct order
b) Apart from the above methods of tendering for placement of orders, the following methods for placement of direct orders may also be considered:
i) Operating DGS&D rate contracts.
ii) Operating rate/running contracts concluded by Coal India Limited or its Subsidiary Companies for revenue items of large demand and of recurring nature and if felt necessary for some of the low value capital items whose requirement are frequent and repetitive like capacitors, coal drill etc.
iii) Repeat Orders
iv) Orders for products with administered pricing.
v) Emergency Purchase/local purchase/Committee purchase as per delegation of power.
vi) Spot/Cash purchase for low value purchases.
vii) Purchase without tender(negotiated)
ADVERTISED TENDER
a) Normally all demands where the Indent value is Rs.30 Lakhs or more may be advertised in leading Newspapers, as per policy of press publications of respective Subsidiary Companies. The MOIL must give its Web Site address in the advertisement/NIT published in the Newspapers.
b) For Global Tenders, advertisement may be published in Indian Trade Journal and Indian Export Bulletin also. The concerned subsidiary/CIL must give its Web Site address in the advertisement/NIT published in the Newspapers.
c) The tender notices should also be published in the Web site. The complete bid documents along with application form shall be published on the Web site of the subsidiary/CIL. The sale of tender paper thro’ Website shall be guided by the following,
Advertised Tender may be dispensed with for any item of P&M, Spare Parts or Consumable Stores, irrespective of the value of the Indent, under any of the following conditions:
a) The sources are limited and whose products are proven.
b) The item(s) indented is/are proprietary to an Original Equipment Manufacturer. In this case, a Proprietary Certificate should be given by the Head of the concerned Technical Department
c) The demand is very urgent as confirmed by the Head of concerned Technical Dept. In this case, list of known and established sources should be vetted by the HODs (tech. dept.)
d) Items to be procured are required to have approval of DGMS or any other regulatory authority.
Limited Tenders shall be issued :
a) If the Indent value of demand is less than Rs.10 Lakhs.
b) In cases falling under para 2.4.2 above.
For limited tender, enquiries may be issued to
(i) the registered suppliers (if registered suppliers list is available) and/or
(ii) to the firms who have been regularly participating in Tender and whose products have been found to be proven and/or
(iii) to those whose names have been furnished by the Head of concerned Tech. Department. The list of vendors shall be approved by Head of Materials Management Department. In case sufficient number of vendors cannot be located with the above three options, assistance may be obtained from vendors directories published by reputed agencies like DGS&D, BIS, Chamber of Commerce, All India Manufacturers Associations, Trade Associations, Yellow Pages, etc.
LIMITED TENDERS FOR SAFETY ITEMS
The safety items which are covered by DGMS approval, their procurement will be limited to registered/enlisted suppliers/ manufacturers possessing above approval and certifications.
ISSUE OF SINGLE TENDER is done when?
Single Tender may be issued for spare parts of any equipment based on a PROPRIETARY CERTIFICATE to be provided by the Head of the concerned Technical Department. Procurement of bought out items should be taken out from such procurement as far as possible, in consultation with Technical Head.
OPERATING OF RATE CONTRACTS
In respect of items required on repetitive basis, purchase may be made on the basis of Rate Contracts concluded by:
The Rate Contract is a contract under which, during the period of its currency, the contractor engages to supply materials on demand, irrespective of quantity, at fixed unit rates or prices, within a given period of the receipt of such demand.
The Company or Subsidiary by itself, through the Direct Demanding Officers named in the Contract.
Any other Subsidiary Company of Coal India Limited after obtaining confirmation from the supplier that they are willing to supply on same rates, and terms & conditions.
Rate Contracts entered into by DGS&D. In such case also confirmation of offer may be obtained from the supplier.
The validity of such Rate Contracts should be for a minimum period of one year w.e.f. the date of issue of contract.
REPEAT ORDERS when?
Repeat Orders shall be avoided normally.
Repeat Orders may be placed against any previous own orders which was placed as a result of normal tendering process, if the demand is urgent and that tendering may not only delay purchase but may also invite higher prices as revealed from movements of National Indices like WPI/RBI INDEX/Nationally accepted PVC Formulae/Rise in Price base in raw materials and components like steel, copper, rubber etc. as revealed from lists published from time to time.
conditions have to be fulfilled for processing a proposal for placement of repeat order:
i) Repeat order should not be more than 25% of the original order quantity.
ii) Not more than one year (12 months) should have elapsed since placement of the original order on the date of the proposal for repeat order
iii) The prices of the items being purchased on Repeat Order basis have not come down in the interim, owing to drop in raw materials cost, increased competition, increased production and taxes, duties etc.
iv) Purchase proposal for repeat order should be put up for approval of the competent authority so that the value of repeat order together with original order, does not exceed the limit laid down in the relevant delegation of powers.
COMMODITIES WITH ADMINISTERED PRICE
Procurement and authority of procurement
The procedure that may be laid down from time to time by the respective price administering authority/Govt. Agency dealing with such items has to be carefully studied and followed in this respect.
Procurement of such commodities, shall be finalized by Materials Management Executives of rank
E-4 upto a value of Rs.20 Lakhs;
E-5 Rs.30 Lakhs;
M-1 upto Rs.50 Lakhs and
M-2 for any value at the prices fixed by Government Agencies from time to time.
The purchase should be made within the approved Materials Budget.
EMERGENCY PURCHASE
When ,how much by whom?
In cases of extreme urgency involving risk of loss of life and property or due to consequences of natural calamities/or an accident in the mine which would lead to a stoppage in production/operations resulting in considerable loss of revenue, emergency purchase without resorting to normal tendering procedures may be resorted to.
Authorization for adopting such mode of purchase would be obtained from HOD of Materials Management Department upto a value of Rs.10 Lakhs for all purchases taken together arising out of the emergency situation.
For purchases of value more than Rs.10 Lakhs/and upto Rs.25 Lakhs, approval of Director-In- Charge of MM Department will be taken.
For purchase of value more than Rs.25 Lakhs, approval of Chairman/Chairman-cum-MD will be obtained.
SUNDRY ITEMS SUCH AS SPORTS ITEMS, ITEMS FOR GUEST HOUSE, UNIFORM & ITEMS LINKED WITH COMPANIES OFFICIAL FUNCTIONS ETC.
The value of procurement by the Committee will be limited to Rs.20.00 Lakhs in each case.
