CTE Type Inspection and Red Flags in Tenders and Contracts for GSI_16Sep25.pdf

This was presented at the Head Quarters of Geological Survey of India as a structured talk on the theme of Public Procurement and Intensive Examination of Procurement Processes especially by Chief Technical Examiner of the Central Vigilance Commission. It was an interesting interactive session which was attended by the officers of the Central HQ and 34 other offices of GSI across the country. It was very pleasing and encouraging experience to address numerous queries from the inquisitive officers. Such capacity building programmes are surely going to help speed up the journey for Viksit Bharat. It covers the various issues related to the procurement process at various stages from the stage of estimation to the execution of the contract for work/supply/service. The various special provisions in the latest manual of DoE for goods procurement and provisions of GeM, MSE, MII and start up was are touched upon.

1. CTE TYPE
INTENSIVE EXAMINATION
and
RED FLAGS IN TENDERS &
CONTRACTS
(16.09.2025)
Harsimran Singh, IRSE
Chief Vigilance Officer, HCL

2. CHIEF TECHNICAL EXAMINERS’ ORGANISATION
(CTEs’ Organization)
CTEOwassetupintheyear1957underthe
erstwhileMinistryofWorks,Housing&Supply.
EarlierMandate:Financial&TechnicalAuditof
theworksofCPWD.
CTEOwasbroughtunderCVCintheyear1964
ontherecommendationofSanthanam
Committee.

3. CHIEF TECHNICAL EXAMINERS’ ORGANISATION
Headed by two Chief Technical Examiners
(CTEs).
One CTE for matters related to
procurement of Civil & Horticulture
works and procurement of Services.
The other CTE for procurement of
Electrical/Mechanical works, procurement
of goods and IT related procurement.
Team of TEs, ATEs and JTEs to assist CTEs

4. CHIEF TECHNICAL EXAMINERS’ ORGANISATION
IntensiveExaminationofprocurement
contracts.
AdvicetotheCommissiononcasesrelated
topublicprocurementandonpolicy
mattersandspecificissuesrelatedto
publicprocurement.
Sharingofknowledgeandexperience
throughworkshops,seminarsandtraining
programmes.

5. OBJECTIVE OF INTENSIVE EXAMINATION
Detection of
deviations from the prescribed policy.
non-compliance of contract conditions.
non-compliance of various statutory
norms.
quality compromises, overpayments, etc.
Identification of need for suggesting systemic
improvement.

6. SELECTION CRITERIA FOR INTENSIVE EXAMINATION
Quarterly Progress Reports furnished
by CVOs.
Specific recommendation by CVOs.
Large Value contracts.
Ordered by the Commission in some
specific complaint and other cases.

7. QUARTERLY PROGRESS REPORT
Minimum
Value (INR
Crore)
Nature of ProcurementSr. No.
5.0Civil Works/Turnkey Works Contracts1.
5.0Stores & Purchase2.
5.0 PPP-Public Private
Partnership[Cost/Revenue values]
3.
5.0Sale of Goods / Scrap / Land4.
1.0Electrical/Mechanical works etc.5.

8. QUARTERLY PROGRESS REPORT
Minimum
Value (INR
Crore)
Nature of ProcurementSr.
No.
0.50Medical Equipment6.
1.00Consultancy & Non-consultancy Service
contracts
7.
0.10Horticulture Works8.
Four highest
value contracts
Supply of Medicines Contract9.

9. INTENSIVE EXAMINATION REPORT
PreparationofIntensiveExaminationReportbythe
TechnicalExaminer.
ApprovaloftheIntensiveExaminationReportbyCTE.
Submissionofsynopsisofthecaseforperusalofthe
Commission.
ForwardingReporttotheCVOandHeadofthe
Organisation.

10. INTENSIVE EXAMINATION REORT
ScrutinyoftheactiontakenreportsubmittedbytheCVO.
Rejoinderforfurtherclarification.
ReferencetotheCVOsforinvestigationonissuesprima
faciehavingvigilanceangle.
Closureoftheintensiveexaminationcasewiththeapproval
ofSecretary,CVC.

11. TIMELINES FOR INTENSIVE EXAMINATION
ScheduleActivity
S.
No.
2Monthsfromthe
dateofinspection.
IssueofIntensiveExaminationReport
byCTEOincludingsubmissionof
synopsis/presentationbeforethe
Commission
1.
2Monthsfromthe
dateofissueofI/E
report
ReplybytheCVOtotheobservations
intheIntensiveExaminationReport
2.
1Monthfromthe
dateofCVO’sreply
RejoinderbyCTEOtoCVO’sreply3.

12. TIMELINES FOR INTENSIVE EXAMINATION
ScheduleActivitySN
1Monthfromthedateof
issueofrejoinder
FinalReplybyCVOto
CTEO’srejoinder
4.
Within1Monthfromthe
dateofreceiptofFinalReply
FinalscrutinybyCTEO5.
3Monthsfromthedateof
receiptofvigilanceparafrom
theCommission
SubmissionofInvestigation
ReportbyCVOinrespect
ofVigilancePara/
Observation(s)received
fromtheCommission
6.

13. ROLE OF ORGANIZATION IN THE INTENSIVE
EXAMINATION BY CTEEnsuringpresenceof
RepresentativeofCVOduringIntensive
Examination.
Officialsconnectedwiththeprocurement
andexecutionrelatedtothecase.
Rectificationofdefectsinworks,goodsand
servicesasobserved.
RecoveriesfromtheContractorsfortheover-
payments,ifany.

14. CTE TYPE INTENSIVE EXAMINATION
Examination of at least six contracts in a year.
At least two contracts of high value, two
contracts of medium value and two contracts
of small value.
Action on the observations raised in the
examination report.
Disciplinary action including obtaining FSA of
the commission, if required.

15. GLOBAL PERSPECTIVE ON PUBLIC PROCUREMENT
AcrucialcomponentofGovernanceandsustainable
Development.
Globally,EstimateofPublicProcurementisabout
15-30%ofWorldGDP.
10-25% ofoverallvalueofPublicContractsgetslost
onaccountofcorruptionasperUNCACunder
UNODC.
Corruptionadverselyaffectstheredistributive
poweroftheStateaffectingthesocialprograms.
UNCAC: United Nations Convention against Corruption UNODC: United Nations Office on Drugs and Crime

16. GLOBAL PERSPECTIVE ON PUBLIC PROCUREMENT
ItisessentialtoadoptAnti-Corruptionmeasures
andModelprocurementcodes
.
UNCAC’sArticle-9ofChapter–IIonPreventive
MeasuresguidestheStatePartiestotakestepson
PublicProcurementandManagementofPublic
Finances.
UNCACprovidessuchaframeworkforshaping
nationalpublicprocurementpolicy.

17. GUIDELINES FOR PUBLIC PROCUREMENT
GeneralFinancialRules(2017)issuedbyD/oExpenditure,M/o
Finance,GovernmentofIndia
Manuals on Procurement of Works, Goods and Consultancy &
Other Services issued by D/o Expenditure in June,2022
Guidelinesissuedfromtimetotimeby
D/oExpenditure
D/oPublicEnterprise
D/oPromotionofIndustry&InternalTrade
NITIAayog
Governmente-MarketPlace
Ministries/Departments/Organisationsconcernedwiththe
approvalofCompetentAuthority.

18. Manuals for Procurement issued by Ministry of Finance
Procuring Entities’ Codes and Manuals (aligned to DoEManuals)
Detailed instructions Standard Bidding Documents
Rules and Regulations
General Financial Rules, 2017 DFPR, Orders of GoI
Statutory Framework
The Constitution of India Acts of Parliament
HIERARCHY OF GUIDELINES
18

19. PUBLIC PROCUREMENT IN INDIA : OVERVIEW
Size of Public Procurement in India is around
18% of GDP
(approxINR64Cr, considering
1USD=INR85 and GDP as $4.19tn)
Broad break-up of Public Procurement –
Procurement of Works : 75% (approx)
Procurement of Goods : 20% (approx)
Procurement of Services : 5% (approx)

20. FIVE Rs & BASIC CANNONS OF PUBLIC PROCUREMENTRight
Quantity
Quality
Prices
Time
Source
Fairness
Transparency
Equity

23. Workpackagesarefurther
brokendownintoactivities
thatareusedtoestimate,
schedule,assign,implement
andcontroltheprojectwork.
Timebuffers/reserve/
contingencyarekeptin
scheduletomeet
unanticipateddelay.
TheProjectManagernormallyusesa
formalchangecontrolprocessto
controlanychangesintheschedule.

24. Costsaredirectlyrelatedtoproject:
Labour
Material
Plant&Equipment
Subcontractors
Costs indirectly related to project :
Overhead&administration
Training
Insurance
Inflation&exchangerate
Taxes
Freight
Licenses
Contingencies

25. Ref: https://www.topbimcompany.com/5d-bim-construction-planning-management/
5D BIM
Integrating 3-dimensional geometry with 4
th
dimension of
time for scheduling and 5
th
dimension of cost for budget
control and estimation

26. CTE TYPE INSPECTION

27. CONTRACT SUMMARY
Date of Acknowledgement by ContractorDate of Letter of Award
Actual date for submission of performance
security
Prescribed date for submission of
performance Security
Actual Commencement DateCommencement Date as per contract
Agreement
Extended date of completion, if applicableDate of Completion as per Agreement
Accepted Value of tenderEstimated Value of tender
Negotiated offer of L1, if applicableOriginal Offer of L1
Present value of contractExpenditure till now
Quantity and Value of New ItemsFinal Contract value
If yes, then dateIs completion certificate issued?
Is ,substantial completion’ certificate issued?
Name of HODName of EIC
Name of Authorised signatory of contractorName of Contractor
If yes, then amountWhether any LD imposed
If LD imposed, has it been actually deducted/recovered?

28. REPORTING PROFORMA
Particulars of Work
Nameofthework:1.1a
AgreementNob
NameofContractorc
EstimatedCostd
TenderedCoste
DuedateofStartf
DueDateofCompletiong
PresentProgressh
DepartmentalAuthorities1.2a
Zone/Unitb
Circlec
Divisiond
Annexure-I

29. REPORTING PROFORMA
Particulars of Work
OfficialsInchargeofWork1.3
ChiefEngineerorEDa
SuperintendingEngineerorGMb
ExecutiveEngineerorDGM/AGMc
Asst.EngineerorChief/SrManagerd
Jr.EngineerorDy/JrManagere
DivisionalAccountant/FinOfficerf
CompletePostalAddress1.4
OfficeTelephoneNo.a
FaxNo.b
OfficeMobileNo.c
E-MAILIDd
Annexure-I

30. 2.0 Events with Chronology
SanctionandEstimation
2.1
Ref.&DateofAdministrativeApproval
a
Ref.&DateofEstimateSanction
b
(A)Ref.&DateofTechnicalSanction(T.S.)
(B)BasisofPreparationofEstimateforT.S.
c
TenderProcess
2.2
DateofApprovalofPQCriteria
a
ModeofTender
(A)Open/Limited/Single(Nomination)
(B)Domestic/ICB
b
TypeofTender
OneStage/TwoStage
c
DetailsaboutFirstStageofTender
d
Purpose
e
DateofAdvertisement
f
REPORTING PROFORMA
Annexure-II

31. REPORTING PROFORMA
Events with Chronology
DateofIssueofRFPg
DateofReceiptofProposalsh
TotalNo.ofProposalsi
NumberofProposalsAcceptedj
NameofAcceptedProposalsk
ModeofTender
OneEnvelop/TwoEnvelops/ThreeEnvelops
C)DetailsofBids/DocumentsinTheseEnvelops
Envelop:1
Envelop:2
Envelop:3
l
DateofApprovalofNITbyCompetentAuthoritym
Annexure-II

32. Events with Chronology
DateofIssueofNITInPressn
DateofAppearanceofNITonWebsiteo
LastDateofSaleofBidsp
Date/sofPre-BidMeeting/sq
CorrigendumtoNIT,Ifany(withdate)r
DatesofReceiptofBids&Date/sofExtension/sofBidss
Date&TimeofOpeningofDifferentBids
Envelop:1
Envelop:2
Envelop:3
t
No.ofTendersSold/Downloadedu
TotalNo.ofTendersReceivedv
NameofBiddersWhoSubmittedBidsw
ReportingProforma
Annexure-II

33. REPORTING PROFORMA
Events with Chronology
EvaluationandAcceptance2.3
Name&DesignationofTECMembersa
DatesofTenderEvaluationCommittee(TEC)Meetingsb
TenderApprovingAuthority&DateofFinalApprovalc
WhetherWorkAwardedtoLowestTendererd
QuotedAmountofLowestBiddere
WhetherNegotiationsConducted(Yes/No)f
AcceptedAmountofLowestBidderg
WorksManualadoptedh
PostAwardofContract2.4
Eventa
DeviationItemNo.b
ExtraItemNo.c
SubstitutedItemNo.d
LastRunningAccountBillPaide
ShiftingofMilestonef
Annexure-II

34. DOCUMENTS FOR INSPECTION AT SITE OFFICE
1(a)Presscuttingincludingextendeddates,ifany.
i)ForPre-qualificationofConsultants.
ii)Forpre-qualificationofContractors.
iii)CallofTendersforMainandotheralliedworks
(b)Register of sale and opening of tenders, (c) Log of e-procurement
2.Preliminaryestimate,administrativeapproval,andexpendituresanctioni/c
processingnotes.
3.DPR,DetailedestimateanditsTechnicalSanctionbycompetenttechnical
authority.
4.ApprovedNITinoriginalincludingNITprocessingnote.
5.Rejectedtenders,comparativestatements,tenderprocessing/scrutiny
notesandacceptanceoftenderfromcompetentauthorityfor
(a)SelectionofConsultants.
(b)Short-listingorprequalificationofbidders.
(c)TenderforMainandotheralliedworks.
Annexure-III

35. DOCUMENTS FOR INSPECTION AT SITE OFFICE
6.Justification statement i/c analysis of rates and corresponding noting in
support of reasonability of rates for acceptance of tender.
7. Details of negotiations if any made before acceptance of tenders.
8.Original Contract Agreement.
9. List of Technical staff deployed by the contractor on the work i/c their
credentials.
10.Performance Guarantee Bond and other Bank Guarantee etc. towards security
deposit, Mobilization advance, Tools plants /Machinery advance etc. including
extension of validity.
11.Insurance policies for work materials equipment, men etc. including
extension of validity.
12. Guarantee for water proofing, termite treatment, equipment provided,etc.
13. Standard schedule of rates and specifications.
14.Proof of EPF and ESI contribution deposited by the contractor for the workers
deployed on the work.
Annexure-III

36. DOCUMENTS FOR INSPECTION AT SITE OFFICE
Annexure-III
15. Drawings-Architectural, Structural, mining sequence, and their approval status.
16. All connected Measurement Book, Level Books, Field Books and Lead Charts.
17. All running Account Bills with all connected statements/ vouchers.
18. Statements showing details of check of measurements by superior officers-
copies of order laying down such requirements.
19. Accounts of Materials at Site, such as, cement, steel, bitumen, paints, water
proofing compound, anti-termite chemical etc.
20. Site order Books / Test Records / Logbooks.
21.Details of extra / substituted items deviated quantities approved by competent
authority / being executed /considered for execution in the work along with
analysis of rates.
22.Hindrance Register.
23.Office, correspondence files, and inspection notes, if any, issued by inspecting
officers.
24.Site order book, and record of complaints, if any.

37. DOCUMENTS FOR INSPECTION AT SITE OFFICE
Annexure-III
25.Any other documents relevant to the works.
26.Details of payments in proforma ‘A’.
27.Cement consumption statement in proforma ‘B’.
28.Steel consumption statement in proforma ‘C’.
29.Statement of test material in proforma ‘D’.
30.Copy of approved Design Mix of Concrete/Bituminous works and batch slips.
31.Test register / File maintained at site.
32.Copy of EOT granted along with note for processing EOT case.
33.Detail of Rescheduling / shifting of Milestone if any.
34.Copy of Completion certificate recorded, if any.

38. DOCUMENTS FOR INSPECTION AT SITE OFFICE
Annexure-III
35.Statement of Cost variation/ Escalation paid to the contractor.
36.Quality assurance reports, audit reports.
37.Detail of reimbursement of Taxes/ royalty etc.
38.Progress reports and photographs/Video.
39.Brief History of the project containing chronological events.
40.EIA report, EMP and Environment clearance from competent
authority if any.
41.Purchase vouchers of cement, steel, and other important materials.
42. List of T&P provided by the contractor at site.

39. Cheque Amount
Details of recoveries
Gross Total Amount
Amount Payable
CR No. (C Bill Nos.) & date
S.No.
Interest on Mobilisation
Advance
Mobilisation Advance
Principal
Interest on T & P
Advance
T & P Principal
Secured Advance
Labour Cess
Work Contract Tax/GST
Income Tax
Security Deposit
Secured Advance
Price Variation paid
P & T advance
Mobilization Advance
As per work executed
Proforma ‘A’: Details of Payment

40. Remarks
Recovered/ received
at site
Actually, consumed
in bags/MT
Theoretical required
Qty in bags/MT
S.N.
Last date of
measurement
Quantity of
cement
Coefficient of
cement
Quantities of
items using
cement
Proforma ‘B’ : Consumption Statement up to last bill
(cumulative)

41. Proforma ‘C’: Details of Steel Reinforcement consumption up to
Last (S No.) Bill Paid
Notes:
1.Ifanyothersteelreinforcementisused,informationmaybefurnishedinsame
proformaasforTMTsteel.
2.Ifstructuralsteelisused,informationmaybefurnishedinsimilarproformafor
varioussectionsinsteadofvariousdiameters.
32282522201612108
TMTSteelDiameterinmm
QtyissuedByDeptt./
Quantityprocuredbythe
contractor(MT)
Qtymeasuredforpayment
(MT)
Qtyrecoveredfrombill(MT)
BalanceQtyatsite(MT)

42. Recoveryproposedforshortfall
intest/failedresult
Whethertestingchargeborneby
Deptt./Agency.
(Ref.toagreeProvision)
Iffailed,whatactiontaken
Statusoftestresult(Pass/Fail)
whethertheLabapprovedby
Govt.
Lab.wheretestconducted
No. of tests
Frequencyoftest
asperBIS
/agreement
Descriptionoftestas
perBIS/agreement
Qty.consumedtill
date
Descriptionof
material
S.N.
Conducted
Required
13121110987654321
Proforma ‘D’ : Statement of tests of Materials

43. ANOMALY:
In a procurement case involving a regularly consumable item of the
unit, TEC did not deliberate on the reasonableness of the rates quoted
by the L-1 bidder.
• The quoted rate was accepted despite being 26% higher than the
departmental estimate.
• No proper justification was provided for accepting the inflated rate.
SUGGESTION:
•Tender Committee must evaluate rate reasonableness of the item.
• It should also be compared with market trends, past rates and
estimated cost.
• Rule 149 of GFR and Organization’s Procurement Manual may be
referred.
• This includes negotiation with L-1 bidder whenever required.
Basic Incongruities & Suggestions Made
Reasonability of Rates

44. ANOMALY:
Pre-qualification criteria (PQC) in certain cases with respect to
techno-commercially/qualifying parameters of the bidders related to
the delivery of the item at unit was arbitrarily defined.
SUGGESTION:
•PQCshouldbeclearlyarticulatedbasedontechno-commercial
parametersandshouldberelevanttothescopeofwork.
•MustensurethatPQCisframedinstrictaccordancewiththe
provisionsoftheProcurementManual.
•ArbitraryorsubjectivecriteriamustbestrictlyavoidedintheNITs
toupholdfairnessandtransparencyintheprocurementprocess.
Basic Incongruities & Suggestions Made
PRE-QUALIFICATION CRITERIA

45. ANOMALY:
It has been observed that:
•MostbiddersfailedtosubmittherequisitePerformanceSecurity
withinthestipulatedtime-frame.
•ThePerformanceSecurityismostlysubmittedintheformofaBank
Guarantee(BG).Thetimelineforsubmissionwasasdefinedinthe
ProcurementManualhadnotbeenadheredtoinmanycases.
SUGGESTION:
•14-dayperiodisfoundtobeimpractical
•Proposed for 30 days of timeline for large contracts
•Also, suggested for suitable pro-rata penal interest for delayed
submission
•It has created regulatory mechanism for timely compliance
Basic Incongruities & Suggestions Made
Extension of time for submission of Performance security

46. ANOMALY:
Ithasbeenobservedthatwhilecalculatingtherequiredannual
averagefinancialturnover,thecriteriawasdilutedbydividingthe
estimatedcostbyperiodofcompletion.
Incorrect Method:
(i)EstimatedcostofTender:Rs100Lakhs
(ii)Periodofcompletion:2Years
(iii)Av.AnnualFinancialTurnoverrequired:
30%of(100/2)i.e.30%of50orRs15Cr
SUGGESTION:
CorrectlycalculatingrequiredAnnualAv.Financialturnoveras
(i)EstimatedcostofTender:Rs100Lakhs
(ii)Periodofcompletion:2Years
(iii)Av.Annualfinancialturnoverrequired:30%of100i.e.30Cr
Basic Incongruities & Suggestions Made
Financial Eligibility criteria

47. ANOMALY:
Inoneofthecontracts,onebidderinsteadofsubmittingwork
completioncertificatehadsubmittedthecopiesofraisedinvoices
andsubsequentpaymentconfirmationthroughmailfromthat
entitytojustifytheworkexecuted/completedasperthe
specifications.TECduringevaluationhadconsideredthese
credentialsassubstitutetoworkcompletioncertificateand
consideredthebiddertechnicallyeligible.
SUGGESTION:
It has been suggested that not to consider these credentials as an
alternative to legitimate work completion certificate. Further, it
has advised that work completion certificate should invariably
contain the requisite details. Some clarifications can be obtained
in reference to the Works completion certificate, but it must be
available.
Basic Incongruities & Suggestions Made
No Alternative-Work completion certificate

48. BASIC INCONGRUITIES & SUGGESTIONS MADE
Work Completion Certificate is single most important document to
decide the eligibility. It should contain
1.Name of Work:
2.Name of the contractor:
3.Date of award of work:
4.Date of Commencement of Work:
5.Original Date of Completion :
6.Actual Date of completion :
7.Original Value of Work :
8.Sanctioned Value of Work :
9.Payment made :
10.Amount as per Final Variation Statement, if final bill not yet paid:
11.Amount of Liquidated Damages imposed if any:
12.Whether work completed satisfactorily:
13.Name and Designation of the Issuing authority:

49. 49
INAUGURATION OF JOKA-TARATALA SECTION

51. RED FLAGS
in
PUBLIC PROCUREMENT

52. 1)SelectionofpartyforST&forselectionofpartiesforLTE
withoutproperjustificationandwithoutproper
documentationsuchasscrutinyoftechnicalandfinancial
eligibility.(CallingLT/STevenwhenOTcanbeeasily
called)
2)Discretionary/Selectiveprovisionalregistrationofparties
forissuingLTE,whilenotconsideringthelastsupplier
whohadsuccessfullydelivered.
3)LimitedTenderEnquiryissuedtopartieshavingcommon
Directors/Partnersaswellashavingknownbusiness
relationswitheachother.
4)Takingstepsthatleadtodeliberatecreationofemergency
situationtosupportSTE/LTE.
RED FLAGS IN CALLING STE & LTE

53. 1)Quantitiesprocuredonearlydelivery/emergencybasisnot
consumedasstatedintheindent.
2)Missingthequantitiesofimportantitemsinthescopethat
resultinInterimDeviationStatement/VariationStatement
sometimesjustatcommencementstage,leadingtoproposals
fornewitems.
3)QuantityandScopeforFreeissueitemsnotstatedclearly,
suchasprovisionofelectricity,storagespace,oldrailsfor
supportingexcavation,etc.
4)ResourcesassumedduringestimationnotindicatedinTerms
&Conditionsofthecontract.Lateronadditionalpayments
madetocontractoronaccountofthese.
RED FLAGS INSCOPE OF WORK & QUANTITIES

54. Truck Mounted Rig
(TMR)
Direct Mud Circulation Rig
(DMC)
Hydraulic Rig
TYPES OF PILING EQUIPMENT

55. 5)Splittingtheindentstokeepthevalueoftenderwithin
DOPofcertainlevels.
6)Separateconcurrentproposalswithoverlapping
serviceactivities.E.g.awardingandcommencinga
contractformaintenanceofplantwhenalreadyone
contractisinplace,andthattooatlowerrates.
7)ScopeofworkmentionednotrelevantwiththeJob
requiredtobeexecutedintheContract.
RED FLAGS INSCOPE OF WORK & QUANTITIES

56. RED FLAGS IN FIXING ELIGIBILITY CRITERIA
1)Mentioningspecificrequirementforroutinekindofgeneral
jobs.
2)Foritemsupply/workexecutioncontracts,notmentioning
requirementofminimumquantityofthematerialsupplied/
workexecuted.PQCshouldclearlymentionthe80%,50%or
40%ofmaterialsuppliedorworkexecutedthrough1,2or3
contractsrespectively.
3)Notmentioningtheclearcut-offdateforsuccessful
operation/experience.Itshouldbeclearlymentionedthatthe
similarworkshouldhavebeencompletedduringlast7
years(say)endinglastdateofthemonthprecedingthe
monthofNIT.

57. RED FLAGS IN ELIGIBILITY CRITERIA
4)Notclearlyandcorrectlyspecifyingthedocumentation
requiredforacceptance/eligibilityinconsonancewith
SpecialTerms&ConditionsofNIT.E.g.workmaybeoflarge
structuralsteelshedandPQCmaybementioningabout
executionofworkofRCCbuildings.
5)Similarworkdefinedinsuchawaysoastofavourselective
partyandrestrictcompetitivebidding.(E.g.‘Constructionof
10spansof45mPSCboxbridgewithwellfoundationof
Double-DtypeacrossriverforRailwaylinewithdoubletrack.)
6)Definitionofsimilarworkineligibilitycriteriabasedonminor
componentofworkespeciallyinCompositeContract.(E.g.
PQC mentions about construction of a 30m span bridge while
the work involves only 1no 30m span bridge and 6nos 45m
span bridges).

58. RED FLAGS IN PRESCRIBING SPECIFICATION
1)SpecificationsaretoorestrictiveorbasedonoId/obsoIete
models/technology.Lateronchangeofspecificationsis
neededleadingtocontractualcomplications.
2)Specificationsdifferradicallyfromwhatismentionedin
estimates.Criticalparametersarenotclearlyidentifiedandare
notmeasureable.
3)Whileprocuringgoods,mentioningofbrandnameintendersor
mentioningofspecialfeaturesofequipmentofaparticular
manufacturer.
4)Contradictioninthequantifiablefactorsresultingindispute
forsettlementofquantities.E.g.measurementby
number/volumeatoneplaceandbylotatotherplace,or2
differentitemsforsameworkwithdifferentrates.

59. RED FLAGS IN PRESCRIBING SPECIFICATION
5)RequirementofManpowerandtheirSkillrequirementnot
definedinthecontractaspertherequirementofjob.
ModeofevaluationofskillofManpowernotmentionedin
thetenderdocument.E.g.,notmentioningthemarksfor
qualificationandexperience.
6)WhileframingTerms&ConditionsofContract,
appropriateclausesnotmentionedfordeduction/recovery
onaccountofsubstandardwork,delayedwork,w.r.t.less
manpower/unskilledmanpowerdeployment.
7)Penaltyclausesnotincludedappropriatelyinlinewiththe
costofthework.E.g.minorfixedamountofLDinvery
largevaluecontractorlargefixedamountofpenaltyina
smallvaluework.

60. 9)Thereareunrealistic
specificationswhichcan
createconfusionand
misalignmentbetweenthe
buyer’sexpectationsand
thesupplier’sdeliverables.
RED FLAGS IN PRESCRIBING SPECIFICATION
Leads to delays, increased cost and
challenges in enforcing contractual
terms effectively.

61. RED FLAGS IN ESTIMATION
1)EstimatenotbasedonLastAcceptedRate(LAR)orLast
PurchasePrice(LPP)dulyconsideringpricevariationduring
interveningperiod.
2)EstimationbasedonLPPofdisputedcontractwhichhasnot
materializedintermsofdelivery,especiallyincaseofgoods
procurementcontracts.
3)Engg.EstimatenotpreparedasperprevailingGuidelines
suchasCPWDratesandAOR,etc.
4)Inmanpowercontracts,estimatepreparedbasedon
assumptionsandnotbasedonthehistoricaldataofactual
deployment,andpaymentonLSbasisratherthanmanpower
basisandwithoutdetailedfoolproofanalysisandstringent
provisions.

62. RED FLAGS IN ESTIMATION
5)EstimatebasedonpreviousorderplacedonSingle
TenderawardedonEmergencybasis.
6)Estimatepreparedconsideringbrandedproductsbut
keepinggeneralizedspecifications.E.g.ratesofGodrej
furniture,Polycabcables,SiemensElectricpanel,53
gradeOPCcement,HightensileStructuralSteel,etc
buttenderitemsareverygeneralizedsuchasmaterial
ofanybrandandlowerspecificationscanbesupplied.
7)Importantitemsrequiredforthetendernotconsidered
duringtheestimatepreparation.E.g.leavingoutitemof
pilefoundationforabridge/workshopprojectwhereas
it’sessentialasperdesignrequirement.

63. RED FLAGS IN TENDER EVALUATION
1.Non-uniformityintechnicalevaluationw.r.t.workexperienceofthe
biddersanddeclaringeligiblebiddersasineligible.Thereshouldnot
bedifferentinterpretationsofcredentialsofdifferentbidders.
2.Offersacceptedbydeviatingfromthetendertermsandconditions.
3.AcceptingofferofthepartyevaIuatedanddeclaredtechnically
eligiblewithoutavailabilityofthecopyoftheworkcompletionand
withoutproperscrutinyofdocuments.
4.JobCompletionCertificateacceptedwithoutmentionofactual
executedvalueoftheworkinthecertificateorassociated
document.Contractawardvalueconsideredastheexecutedvalue.
5.WorkOrders/POsofongoingcontractsshouldnotbeconsidered
duringevaluationwithoutbeingspecificallymentionedinNIT.

64. RED FLAGS IN TENDER EVALUATION
6.Credentials of a Party are rejected in one tender, but same
credentials are accepted in another tender with same Eligibility
Criteria.
7.Technical Evaluation done without mentioning all relevant data.
8.Considering the credentials issued by private party without
following proper criteria. Credential from public listed company can
be considered only when it’s listed on NSE/BSE, and is incorporated
/ registered at least 5 years prior to date of closing of tender and has
average annual turnover of atleastRs500Cr in last 3 years.
9.In case of Budgetary Offer sought / Purchase Order issued to the
Supplier on behalf of OEM, present status of authorization from OEM
is notensured.
10.Considering the credential of the parent company of a subsidiary,
who is the bidder.

65. 11.The contract is awarded to an
entity with which an individual
involved in the procurement
process, has a familial or
close business relationship.
CVC Circular 03/01/22:
Mandates disclosure of
conflicts.
TEC members are supposed to
ensure that they don’t have any
such relationship with the
bidders.
RED FLAGS IN TENDER EVALUATION

66. 12.Two bidders/contractors
engage in a secret
discussion before
submitting their bids,
resulting in identical
offers.
RED FLAGS IN TENDER EVALUATION

67. 1.Not ensuring timely signing of Contract Agreement and execution
of work and release of payment after Contract Agreement.
2.Not ensuring submission of Performance Security / Insurance
Policies by the contractor within stipulated period
3.Allowing subletting of job without written consent of the Employer
in violation of the contract provisions.
4.Not maintaining the Field Bookand Measurement Book properly
and not ensuring that record of quantities in Field Book is
matching that in Measurement Bookand RA Bills.
5.Not maintaining proper record related to free issue of materiaI
from department such as cement, steel, rails, equipment, etc.
6.Not maintaining proper record related to Equipment, Vehicles and
Key Personnel deployed bythe contractor.
RED FLAGS IN CONTRACT MANAGEMENT

68. 7.The contractor has supplied
a simple stool instead of an
“ergonomic executive
seating system’’.
The material must be
passed meticulously as per
the specification.
RED FLAGS IN CONTRACT MANAGEMENT

69. 8.Contractgetsawardedthe
paymentsaremadetothe
vendorwhoseregisteredoffice
addressisonlyamailbox,with
non-existenceofitsphysical
premisesoroperational
facilities.(ShellCompany)
RED FLAGS IN CONTRACT MANAGEMENT

70. GeM
Rule149ofGFR2017
ForGoodsandServices
MandatoryforprocuringentitiestoprocureGoodsand
ServicesavailableonGeM(MandatoryforCentralGovt)
DirectPurchase(UptoRs50,000/-)
L1basedselection(aboveRs50,000/-anduptoRs10Lakh)
RAbasedselection(aboveRs10Lakh)
IncaseofmultipleL1bidders,systemdrivenRAforgoods
tendersand“RunL1selectionfeaturetobeusedforservice
tenders”

71. SOME SPECIAL PROVISIONS OF
DOE’s
PROCUREMENT MANUAL
FOR GOODS
(ISSUED In 2024)

72. WITHDRAWL BY A BIDDER
Para 7.6.2-3
Insinglepacket,ifL-1withdraws,thenRetender
Incaseoftwopackettender,incaseofwithdrawalofofferby
abidderwithinvaliditybeforeTechno-commercialevaluation
iscompleted:
CompleteTechno-commercialevaluation(includingofthe
withdrawnbid/s)
Ifawithdrawnbidqualifies-Openthefinancialoffers.
IfawithdrawnbidisL1-Retender

73. MAXIMUM LIQUIDATED DAMAGES
PARA 9.6.10-1
Upper Limit of LD reduced to 5% of the total value of
contract (from previous 10%)
Provision for inordinate delay (> 25% of delivery
period) may be treated as
breach of contract
deficient performance to be held against the contractor in
future tenders

74. E-REVERSE AUCTION
PARA 4.11
UpperstartingpriceisthepriceofL1bidder
NoeRA,whennosofValidbidders<stipulatednumber(say3)
Procedureforeliminationofbiddersine-ReverseAuction:
Thehighestbidder(s)inthefinancialbid-disallowedfirst.
>6validbidders-50%ofthebiddersallowed
4to6validbidders-lowest3biddersallowed
MSE/Class-ILocalbiddershavingpriceswithinpreferencemargin-be
allowedoverandabovetheshort-list
NoNegotiationaftereRA

75. COMPETENT AUTHORITY BEING HON’BLE MINISTER
PARA 7.1-3-E
CA’sapprovalistakenatseveralstagesinprocurement
WhenCAishon’bleMinisteroftheCentralGovernment(orBoardof
DirectorsinaCPSE),obtainingapprovalsatsomanystagescausesdelays
andoverburdensthem
Insuchcases,theirapprovalmaynowbeobtainedonlyatthestageof
“ApprovalofFinancialEvaluationandAwardofcontract.”
Atotherstages,approvalmaybetakenfromtheofficertowhomsuch
powersaredelegatedbythehon’bleMinister(orBoardofDirectors).

76. •Whennegotiatingwiththenon-MSEL1bidder,thepricebandof
L1+15%tobecalculatedbasedontheoriginalL1price,andsuch
eligibleMSEbiddersshallbecalledtomatchthenewnegotiatedL1
price
•Example
–L1Non-MSEhaspriceRs100Lakh,L2MSEhaspriceRs114Lakh
–NegotiationisheldwithL1,andL1reducespricetoRs95Lakh
–Here,L2willbegivencounterofferforRs95Lakhfor25%ofthe
orderedquantity.
NEGOTIATIONS IN PURCHASE PREFERENCE
[PARA 1.11.2]

77. Substantiallyresponsivebid
Bidwhichiscompleteandconformstothetender
document’sessentialterms,conditionsandrequirements
Bidsthatarenotsubstantiallyresponsivetobetreatedas
‘UnresponsiveBids’
Whileshorterbidvalidityperiodprovidedbybidderinits
bid,isconsideredas‘UnresponsiveBid’,however,shorter
bidvalidityin case of STE/ PAC procurementmaybe
accepted
UNRESPONSIVE BIDS
[PARA 7.3.1]

78. Purchasermayaskclarificationsfromthebidder/sin
writing,forshortfalldocumentswithinaspecified
period.
Clarificationcanbeonlyforhistoricaldocumentspre-
existingatthetimeofbidopening:
DocumentslikePAN/GSTregistrationoramissing
completion/performancecertificateforasubmitted
supplyorder
Nonewsupplyordersshouldbeaskedfortoqualify
thebidder
CLARIFICATION DURING BID EVALUATION
[PARA 7.3.5]

79. Concernofviabilityofperformance.
TECtoaskwrittenclarifications/priceanalyses.
IfBidderfailstodemonstrateviabilityofperformance–reject
thebid.
Notadvisabletofixa%agebelowtheestimatedcostasan
abnormallylowbid.
ProvisionofAdditionalPerformanceSecurity(AddlPBG,etc)
nottokeptinthecaseofALBbekeptinthetenderdocument
ABNORMALLY LOW BID -
[PARA 7.6.7]

80. GUIDELINES ON ARBITRATION
[PARA 9.9.5]
Arbitrationasmethodofdisputeresolutionshouldnotberoutinelyor
automaticallyincludedinprocurementtenders,especiallyinlargecontracts
Arbitration(ifincludedintenders)mayberestrictedtodisputeswithvalue<Rs.10
Cr
InclusionofArbitrationconditioninatendertocoverdisputevalue>
Rs10Crtobebasedon
CarefulApplicationofMind&RecordingofReasons
Withapprovaloftheapprovingauthoritiesasfollows:
SecretaryConcernedoranofficer(notbelowthelevelofJoint
Secretary)forGovernmentMinistries/Departments,attached/
subordinateofficesandAutonomousBodies(ABs)
ManagingDirectorinrespectofCPSEs/PSBs/Financial
Institutionsetc.

81. MSE AND MII ORDERS
MIIMSEParameter
Itemshouldn’tberestricted
forprocurementfromClassI
localsuppliersonly.
(L-1 should be non Class I)
Itemshouldn’tbereserved
MSEVendors.
(L-1 shouldbe non-MSE)Applicability
20%15%Purchase Preference margin
50%25%Quantum of Order
(minimum)
NoYes
Distribution among all
eligible vendors within the
margin of PP
YesYes
Requirement of matching L-1
price

82. 30-08-2025 82
PROCUREMENT OF GOODS –MSE AND MII ORDERS
ACRONYMTERMINILOGY:
SUPPLIER
CATEGORY: IF SUPPLIER IS
M-C1MSECLASS I LOCAL
BOTH MSE AND CLASS I LOCAL
SUPPLIER
M-NC1
MSENON-CLASS I
LOCAL
MSE BUT NOT CLASS I LOCAL
SUPPLIER
NM-C1
NON-MSECLASS I
LOCAL
NOT MSE BUT IS A CLASS I
LOCAL SUPPLIER
NM-NC1
NONMSENON-
CLASS I LOCAL
NEITHER MSE NOR CLASS I
LOCAL SUPPLIER
HCL_Workshop_Aug 25

83. 30-08-2025 83
DECISIONSCENARIO
Award the contact to L1.L1 –Class-I LocalSupplier
50% contractaward to L1.
Forbalance50%-asktheClass-ILocalSupplier(s)
within20%margin,onebyone,inascending
orderofprices,tomatchtheL1price.
Ifanyoneagreesthen50%contractawardedon
him,preferencetoonewhoseinitialquotedrate
islower.
Ifnoneofthemagrees–100%contractawardto
L1.
L1 –Class-II Local Supplier/Non –
Local Supplier
Withinthepricemargineof20%,
theremaybe1ormoreClass-I
LocalSupplier/s
IfClass-ILocalsupplieragree(s)forlessthan50%quantity,sayfor25%quantity,then
contractawardedtoL1willbefor75%oftenderquantity.
APPLICATION OF MAKE IN INDIA(MII) ORDER 2017
HCL_Workshop_Aug 25

84. 30-08-2025 84
STARTUPS : EXEMPTIONS & RELAXATIONS
StartupsrecognizedbyDPIIT
ExemptedfromfurnishingEMD
Theconditionofpriorturnoverandpriorexperiencemayberelaxedfor
Startupssubjecttomeetingofqualityandtechnicalspecificationsand
makingsuitableprovisionsinthebiddingdocument
Forprocurementofitemsrelatedtopublicsafety,health,critical
securityoperationsandequipment,etc.,theprocuringentitiesmaynot
relaxthecriteriaofpriorexperience/turnoverfortheStartups.
Nootherpreferenceslike‘PurchasePreference’isavailableforStartups
inPublicProcurement.
HCL_Workshop_Aug 25

85. CHECK LIST FOR THE PROPOSAL OF QUOTATION/LIMITED/SINGLE TENDER
Ratereferencesarenotbarred.1.
Incaseofbudgetaryquotationratehasbeentakenfromthree
differentgenuineagencies.
2.
Identity,address,mobileno.etc.oftheagencieshavebeenverified.3.
Theproposalforobtainingadministrativeapprovalforobtaining
dispensationwithTender/OpenTendercontainsthedetailsofwork,
justification,proposedtermsandconditionsandnamesofparties
alongwithbasisofselectiononwhichenquiryistobeplaced.
4
Estimatedcostoftheproposedquotation/LT/STismentioned.5.
Periodofcompletionismentioned.6.
GST&Profitareincludedinratesasperstandardprocedure.7
Howrateanalysishasbeendone-Asperlaiddownguidelineofthe
organization,AspertheCPWDAOR,orbyothermethod.
8.

86. CHECK LIST FOR THE PROPOSAL OF QUOTATION
ConcernedOfficialshavesingedallpagesofproposal.9.
Competentauthorityis mentionedasperSOP10.
Estimatenumberismentionedfromwhichexpenditureis to be
incurred.
11.
Reasonablenessofrateiscertified.12.
StandardTermsandconditionswithprovisions of LDandQuantity
variation are mentioned
13.
Price Variation Clauseis not applicable14.
Provisionof‘Running Bill’ maybeincluded if deemed fit.15.
Estimate for the proposed quotation tender/LT/ST has been vetted
by finance
16

87. Whether Demanded by Contractor or proposed by Engineer/Employer1
Technical justification of the New Item
a) Item is essential for successful execution of the work, eg, other
item/items are dependent upon this
2
Financial Aspect of the New Item
a)Ratereferences arenotbarred
b)Rate has been arrived at as per the procedure specified in the contract
agreement, if it mentions so
c) Rate reasonableness has been certified
d) GST&Profitareincludedin the ratesasperstandardprocedure
e) Financial concurrence has been obtained and the rate has been vetted
by the finance, if required as per SOP
f) Revised contract value after addition of the new item if sanctioned
3
CHECK LIST FOR THE PROPOSAL OF NEW ITEM

88. Whether Administrative approval for the new item
had been accorded by the competent authority, if
required
4
CompetentauthorityismentionedasperSOP5
Keydatesarenotexceeded.6.
ValidityperiodofthePGisavailable.7.
ConcernedOfficialshavesingedallpagesof
proposal.
8.
CHECK LIST FOR THE PROPOSAL OF NEW ITEM

89. CHECKLIST FOR THE VARIATION STATEMENT
Technical justification for positive and negative variation in each
item
1
Financial aspect of positive and negative variation in each item2
Whether new rates are to be paid for excess variation beyond
specified
3
Keydates/milestonearenotviolated4
ValidityperiodofthePG&Insuranceisavailable.5
Vitiationstatementisattachedandendorsed6
Reasonablenessofrateiscertifiedbythe concerned official/s.7
Competentauthority ismentionedasperSOP8
ConcernedOfficialshavesingedallpagesofproposal
(Engineer/Employer as well as Contractor)
9

90. ध?यवाद
THANK YOU
ध?यवाद
THANK YOU