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BUSINESS MARKETING
(INDUSTRIAL MARKETING)
OIL AND NATURAL GAS COPRPORATION
Cheap custom writing service can write essays on INDUSTRIAL PROCEDURES OF ONGC
( ONGC )
Submitted By-
PGPMS Marketing
III Semester
TABLE OF CONTENTS
S.NO.TOPIC
1Introduction
Purchase Procedure
Purchase Methods
4Bidding System
5Invitation of Tenders
6Opening of Tenders
7Cancellation/Re-Invitation of Tenders
8Clauses in Tender Supply and Reorder
Purchase Powers
INTRODUCTION
qWork in the Oil & Natural Gas Corporation Ltd. (ONGC) has been organized on the basis of functional Business Groups with commercial working relationship among these groups. The Business groups are
a)Exploration
b)Drilling
c)Operations
d)Technical
Director concerned of the above business groups assume effective charge of all functional aspects of Materials Management
qThe procurement and stocking of materials is decentralized to the respective Business Groups at Headquarters and Regions. Every business group has a structured Materials Management set up with suitable structure at the Regions and Headquarters. The Headquarters' materials Management set up with the concerned Director is responsible for the following -
a)Procurement and related work including Steering committee cases, Executive Purchase Committee cases. However policy matters including liaison with the govt. will be done by the Materials set up under Director (T).
b)Providing superintendence to the Materials set at the Regions under the concerned Business Group with regard to different functions of Materials Management as for example Inventory Control, Disposal, Codification Standardization of Specifications, Computerized MIS and Stock verification etc.
c)Bulking of all high value indigenous and critical items to be procured centrally for taking maximum advantage in price discount. The Headquarters Materials set up for all Regions under the group would do such exercise.
qThe above functions are to be discharged by the personnel of Materials Management discipline who will be so allocated to each Business Group both at Headquarters and at the basis. However the procurement of all indigenous materials except as mentioned above is decentralized with their respective Business Group.
qMaterials procurement powers to be exercised only by exception by functional executives other than Materials Management executives by special nomination by the Competent Authority as a stop gap arrangement till such time materials personnel are in position.
qThe Materials Management Support Groups will function strictly within the policy guidelines and such administrative norms as may be prescribed by Director (Technical)
qProvisions of Materials Management Manual are duly approved by Executive Committee/Steering Committee and ratified by the ONGC board. Therefore, any deviation from the prescribed policy guidelines or norms on Materials Management will require reference to Director (Technical) through the Director incharge of Business group for approval/ratification of competent authority wherever considered necessary.
PURCHASE PROCEDURE
Aim of the Materials Management Organization is to procure, preserve and deliver materials in proper time to ensure smooth progress of the project works and administrative machinery.
qDEPENDENT FACTORS
The Materials Management Organization will make every effort to meet the needs of the Engineers and the Scientists with regard to the Materials. But the success of the aspiration of the materials Management depends very much on the proper planning and timely intimation by the concerned Engineers/Scientists to the Materials Management. It is, therefore, essential that these aspects be kept in view to ensure timely procurement of materials/services.
qCLASSIFICATION OF MATERIALS
The purchase can be made with the advantage on the results of classification of materials and stock levels. It is essential that these points be given treatment before passing onto the purchase procedure. The materials procured/accounted may be classified into following categories -
a)Proprietary Materials - Manufactured by the makers of the mail plants themselves such as spare parts for Willys' Jeeps.
b)Non- Proprietary Materials - Manufactured by many firms such as chemicals and laboratory equipments
c)Stock Items - Fast moving items of regular consumption as also spares for running repairs and periodical overhaul of machinery.
d)Non-Stock Items - Those, which are to be purchased against specific requirements of the indenting departments.
e)Capital Items - Items costing Rs.5000/- or more and with a life of 1 year.
f)Stores and Spares - Items costing less than Rs.5000/- and life 1 year.
FUNCTIONS OF PURCHASE DEPARTMENT
The vital functions of Purchase department are -
a)What quantity to buy
b)When to buy
c)When to buy
d)From whom to buy
e)At what price to buy
f)What quality to buy
The purchase department while making purchase should see that -
a)All purchases are made for properly authorized requisitions clarifying the purpose for which these are required;
b)All materials requisitioned are duly out from the right choice after full enquiries;
c)Right type and quality of material are bought from cheapest source;
d)Right quantities are purchased are purchased in right time;
e)Deliveries are received in right time;
f)Suppliers' bills are paid promptly;
g)Pre-Bid Conference in cases of high value procurement cases of materials/services/turnkey projects of complex nature where the specifications are not very clear / in case of a new or latest technology; and
h)Adjustments on claims due to shortage or due to any discrepancy are secured.
CENTRALISED / DECENTRALISED PURCHASES
In drilling business group, purchase functions of the following items are handled as under -
S No.ItemBase
1BarytesChennai
CMCDehradun
Oil Well Cement and Cement additivesMumbai
4BitsDehradun
5Blow out Preventors & AccessoriesDehradun
6RigOnland and OffshoreDehradun
7Spare & assemblies for on-land rigsDehradun
8Spare & assemblies for off-land rigsMumbai/Chennai
Well HeadsOnland and OffshoreDehradun, Mumbai
10Imported mud chemicals and mud additivesDehradun
Procurement functions in respect of other Business Groups are handled as per instructions issued from time to time.
PURCHASE METHODS
qPurchase will be made through any of the following methods
i.Purchase through Directorate General of supplies and disposals (DGS&D)
ii.Open tenders
iii.Limited tenders
iv.Single tender
v.Hand quotations for petty orders not costing more than Rs. 5000/-
vi.Annual Rate Contracts
vii.Board of officers
qPURCHASE THROUGH DGS&D
a)There are three ways of purchase of materials through DGS&D
i.By placing indent on DGS&D who on his side invites the tenders from the dealers on his approved list.
ii.Through DGS&D Rate/Running contract In this case also indents are to be placed on DGS&D who places orders on the firms with whom they have concluded the Rate/Running contract, such as petroleum products.
iii.Through Rate contract concluded by the DGS&D In this case no indent is to be placed on DGS&D but the officer of the organization who is appointed by the appointed by the DGS&D as the "Direct demanding Officer", can place order direct with the firm on rate contracts concluded by the DGS&D.
b)No separate tenders need to be invited when the delivery period stipulated in the DGS&D rate/running contracts is acceptable. However, where the delivery period of any such contract is not suitable, the Purchase Officer may place a direct supply order on the DGS&D rate contractors on DGS&D rates or lower rates and where it is not possible to obtain supply of an item either by operating on the DGS&D rate contract or by placing a direct supply order on the DGS&D contract holders because the delivery period does not suit their requirement.
c)All other items not covered by the rate/ running contracts will be arranged by the materials management by inviting tenders.
qOPEN TENDERS
a)When the value of the tender is more than Rs. 5.00 lakhs, open tenders are invited, which are advertised through the press. For indigenous purchase advertisement is given in at least two National English newspapers. Incase of imported materials, the open tenders are additionally through foreign journals besides advertising through Indian Trade Journal or Indian Export Service Bulletin. Two sets of complete bidding documents are sent to the Consulates/Embassies/Trade Representatives of the countries of prospective suppliers for circulation amongst likely suppliers in their countries.
b)Open tender bidding documents are to be issued to the bidders on application against prescribed tender fee. At least a month's time is normally given after submission of bids. After the date of publication of advertisement. In emergent cases, however, it may be curtailed to 1 days.
c)Invitation of open tenders will not be necessary in the following cases
i.Purchases against DGS&D rate contract, and
ii.Where the sources of supplies are known and limited
d) The reasons for not following the normal tender procedure is recorded in writing by the Purchase Officer and the approval of the Head of the concerned Materials Management obtained for dispensing with the advertising procedure.
qLIMITED TENDERS
a)For purchase of the value of Rs. 5.00 lakhs or less, it is not necessary that the tender be advertised. In such cases, the purchase officer may send enquiries to firms known to ONGC. The enquiries are also sent to the registered firms under the heading "Registration of firms".
b)Enquiries are sent to as many firms as possible to ensure competition. In cases where the number of known/registered firms dealing with the materials under the purchase is large, enquiries may be limited as given below. In such cases, firms will be sent enquiries in rotation to ensure competition and allowing all firms an opportunity to compete. The minimum number of enquiries to be floated will be as under
For tenders up to Rs. 5,0005 enquiries
For tenders from Rs. 5,001 to 75,0007 enquiries
For tenders from Rs. 75,001 to ,50,0008 enquiries
For tenders from Rs. ,50,001 to 5,00,00010 enquiries
c)When the firms dealing with ONGC is less than the required, the enquiry maybe sent to all such firms after obtaining the approval of the next higher purchase officer or when next higher purchase officer is not available, of the project head.
qPurchase of single tender
a)Purchase of non-Proprietary items
Purchase on single tender basis will be resorted to only when there is emergency to tide over which the competent authority has sanctioned purchase of non-proprietary items on single tender basis.
b)Purchase of stand-by equipment and accessories
Stand-by equipment and accessories, which form part of the main equipment and are, required to carry replacement and which can not be replaced with other markets on technical grounds may also be purchased on single tender basis from the Original Equipment Manufacturer/Authorisee distributors of Original Equipment Manufacturers without a proprietary article certificate provided it is approved by Director Incharge of concerned business group in consultation with finance that no other type of equipment/accessory can be used as replacement.
For cases at regions, concerned Regional Director in consultation with finance will also have powers to approve procurement of such items on single tender basis up to the value of Rs. 10.0 lakhs. Similarly, concerned GGM/GM for cases at headquarters and project head for cases at projects in consultation with finance will have powers to approve procurement of such items on single tender basis up to the value of 1.00 lakh. It must be ensured that the equipment/accessories are consumed within the financial
c)Purchase Of Proprietary Articles (PAC)
Purchase of proprietary items is made if it is absolutely essential. Declaration of an item as proprietary is done under the powers of Director in association with Finance and Materials Management.
The concerned Regional Director in case of Regions and concerned GCMGM in case of headquarters / concerned Project Head for cases at Projects. In association with finance and Material Management will also have powers to declare an item as Proprietary provided indent value of the same does not exceed Rs. 10 lakhs in case of regions and Rs 1 lakh in case of headquarters/projects respectively. It must be ensured that the items are consumed with the financial year.
For purchase from single source, the indentor must provide the PAC along with indent. The indentors should justify the proprietary purchase and should support the indent with Proprietary Article Certificate.
qPETTY PURCHASES/ HAND QUOTATIONS
a.Petty Purchases Purchase upto Rs 500.00 at a ttime may be made without formal enquiries or without obtaining hand quotations by User Departments themselves.
b.A statement of petty purchases made by the User Departments will be sent to the materials department concerned at the end of each month so that taking into account the frequency of such purchases these may be considered for inclusion in the list of stock items to avoid further piecemeal purchases.
c.No GRV will be raised for petty purchases of consumable items upto Rs. 500 and such transactions need not be routed through concerned material management. Also no covering supply order need be issued for petty purchases of consumable items upto Rs.500
qPURCHASE AGAINST HAND QUOTATIONS
a.Purchase above Rs. 500.00 but upto Rs.5000.00 may be made either by user Department or by the Purchase Department by obtaining at least three hand quotations . A list of prominent and reliable local firms , will be maintained by all the concerned.
b.User departments will not go for direct purchases over Rs.5000.00 at a time barring operational emergencies involving breakdown in operations.In operational emergencies the user Department may make direct purchases as per powers delegated in the book of Delegation if powers.
c.Purchase from state emporiums/Super Bazaar/ Govt. Dept. Undertakings-Whenever items are available in all the above mentioned purchases are supposed to be made from them only and in those cases, the requirement of obtaining three hand quotations will not be necessary.
qPURCHASE THROUGH BOARD OF DIRECTORS
Purchase by a Board of Officers will be resorted only in exceptional circumstances when the materials are either required urgently to overcome an emergency or because the indentor is not able to give firm specifications ? necessitating on the spot decision so that procurement cannot be made under the normal purchase procedure , provided further that
a.Prior sanction of the concerned Regional Director in cases of Regional Business Centre, concerned Project Head in case of Projects and concerned Head of Business group not below E-6 level in cases at Headquarters will be obtained before resorting to purchase by a board of officers.
b.The Head of Business Group at headquarters/ Head of Region/Project
Head will ensure that the indentor has obtained and rendered a non-availability certificate on STR-6A in respect of the items (other than crockery, cutlery, linen and items of complimentaries) to be purchased.
c.The Board will be constituted by the Head of the Materials Management of the concerned Business Group at the Headquarters and General Manager/ Project Manager in the regions and it should comprise of the Competent Purchase Officer under whose Powers the purchase falls and an officer each of equivalent status from the indenting and Finance and Account Departments proceedings of such purchase boards will not need approval of any authority since spot decisions are required . If for any reason ift is not possible to constitute a purchase board with competent officers the board may be constituted with an officer of the next below rank. However, the reasons should be recorded in writing and the proceedings of such a purchase board should be ratified by the authority constituting the board.
d.The board of officers will if necessary be authorised to purchase from market on cash basis whatever they think is a necessary requirement.
e.The officers shall obtain as many quotations as possible so as to determine the reasonability of rates. In case the supplier(s) do not agree to give the hand quotations this fact will be recorded by the board of officers in their proceedings.
qEMERGENCY PURCHASE
a.Emergency purchases may be resorted to if there is a certain break down or likelihood of a breakdown and when it is necessary to restore normalcy of equipment, machinery or vehicles and the urgency does not permit following the normal methods of purchses.
b.Emergency purchase indents will be distinctively coloured red and the word "EMERGENCY" boldly stamped at the top. Full reasons for proposing emergency purchase will be stated in the indent which will be signed by the competent authority. The authority before signing the emergency indent will ensure that the indentor has ascertained the stock and dues in the position of the required item or a suitable substitute thereof and obtained non availability certificate on STR-6A. The indent for emergency purchase will be accepted by the Purchase Department only if it is accompanied by the non availability certificate on STR-6A.
c.Prior financial sanction will not be necessary in the case of emergency purchase on single tender basis.
d.The competent authority for signing the emergency indent will be as under
Authorised Personnel/Competent Authority
1.General ManagerUpto 50,00/- in each case
.Dy. General Manager
. GGM/GM,KDMIPE/IDT/IRSUpto Rs 10,000/- in each case
4. Head of departmentsubject to a maximum of
5. Head of Business Group Rs.50,000 per annum
6. Project Manager
7. Manager Workshop Baroda/ Sibsagar
8. Sr. Dy Manager Incharge of Project Upto Rs 5000/- in each case
. Chief Engineer/ Regional Chief Geophysicist subject to a maximum of
Chief Manager(R Rs 50,000 per annum
10.Superintendent Geophysics ,Upto Rs 1000/- in each case
Engineer, Geologist, Chemist
11. Officer In Charge
1.Head Of Office
BIDDING SYSTEMS
qTWO BID SYSTEM
a.The Two Bid System is followed in the following cases-
i.Purchase of Capital items of complex and sophisticated nature exceeding Rs.50.00 lakhs value where the detailed or accurate standardized specifications are not available and hence cannot be furnished at the time of inviting tenders.
ii.The manufacturer to his own specifications designs a costly and critical item for which design is given by ONGC but the equipment.
iii.Service contracts where the specifications are not clear which may lead to clarifications after receipt of tenders.
b.Under Two Bid System the bidders will be asked to submit "Technical and Commercial bids separately in sealed cover duly prescribed and both the offers placed in one single sealed cover at a central place , For this purpose suitable labels in different covers will be provided with the bidding documents.
c.The technical bids are opened first and scrutinized by Tender Committee.
qTechnical Clarifications from bidders
a. High Value Items involving turnkey contracts
i. In these cases technical clarifications if needed even for shortlisting of bids can be sought on telex without affecting the quoted prices . Once short listing is done all the outstanding contractual points should be sorted out in the discussions with the shortlisted bidders. During these discussions bidders are to be advised of loading proposed to be done if exceptions are not withdrawn.
ii.The proposed loading should be communicated to the shortlisted bidders and their response obtained in sealed covers before opening priced bids if not already done
b. Lower Value Items
In these cases technical clarifications would be sought if needed based based on technical evaluation of offers making it clear to the parties that no change in price on this account would be accepted clarifications may be called on more than two occasions from any party.
i. After all the clarifications have been obtained by the specified date and time, all the bidders of technically acceptable bids will be telegraphically notified of the date of opening of bids in public allowing at least a period of 7 to 15 days depending upon the urgency of requirement and location of bidders, so as to enable such bidders to participate in tender opening if they so like. The commercial bids will be opened by same Tender Opening Officers who are already / detailed for opening tenders under Single Bid System.
ii. Priced bids, which remain unopened with ONGC, are to be destroyed shredded after six months of the finalization of the tender, after obtaining prior approval of the Head of MM of concerned Business Group. A clause in this regard should be inserted in the Bidding Documents.
iii.In case where technical specifications are quite clear the Two Bid system should not be applied and seeking technical clarifications from the bidders after opening of the tenders, should not be necessary.
INVITATION OF TENDERS
qCOORDIANATION AND BULKING OF DEMANDS FOR PURPOSE OF INVITING CAPITAL TENDERS
Demands for the materials received simultaneously from different indentors should be combined as far as possible while inviting tenders. Due regard should be paid to the delivery instructions by the indentors.
qENQUIRY REGISTER
Every individual section dealing with purchases will maintain as enquiry register. A separate page for each enquiry will be allotted in that register.
qTENDER SETS TO BE KEPT READY AND TENDER INTIMATION TO BE SENT TO PROSPECTIVE BIDDERS
All concerned dealing with open tenders before they send tender invitation to press for advertisements will ensure that
1.The tender forms are complete in all respects and are ready for sale.
.Tender intimations are sent to the prospective bidders as soon as the information is received that the tender has been advertised.
qSUBMISSION OF TENDERS FOR PUBLICATION IN PRESS
Any date in keeping with the margin of 10 days from the date it has been sent for advertisement to the publicity department.
qTIME TO BE ALLOWED TO BIDDERS TO QUOTE
The following period is allowed to bidders for submitting their bids
I.For hardware import purchases45 days
II.For specialized purchases such as rigs/vessels & complex Turnkey Projects75 days
III.For line pipes60 days
IV.For Well cum Process Platforms0 days
V.For indigenous Purchasesa) Limited Tendersb) Open Tenders1 days0 days
VI.For Well Platforms75 days
qVALIDITY PERIOD
In all tender notices under Single Bid System that offer with lesser than the required validity is straightway ignored. In Two Bid System no offer should be rejected on account of shorter validity.
qNOTICE FOR INVITING QOUTATIONS/TENDERS (NIT)
i.It will indicate the place, date & time by which the tenders are received & opened.
ii.Closing time for the bids is14.00 hrs. & these is opened on the same day at 15.00 hrs.
iii.Bids sent by post must be sent under registration cover to reach the place well before the closing date.
iv.All bids received is registered under the signature of the Tender Receiving Officer.
v.Sometimes materials conforming to given specifications are not easy to produce. In such cases relaxed specifications which may not be acceptable are written down in consultation with the indenting technical department.
vi.Notice Inviting Quotations/Tenders indicate the date & time of commencement of the sale of tender.
vii.Bidding documents, depending upon value notified from time to time, are made available for sale on specified date & time at (1) Dehra Dun () Kolkata () Mumbai (4) Chennai.
qNUMBER OF COPIES OF OFFERS TO BE CALLED FROM BIDDERS
i.Where in-house evaluation is involved- Copies in triplicate
ii.Where bid evaluation is done by outside agency- Five Copies
qVARIATION IN QUANTITY AFTER INVITATION OF TENDER
a)Provisions are made in all tender conditions for procurement of goods that ONGC is entitled to increase or decrease the quantities amongst any/all the items of the tender by not more than 0%. However, in case of procurement of goods under Two bid system. Any variations till +/- 0% of the tendered quantity would be permissible only if it is decided before the price bid opening.
b)In case of increase in quantity of more than 0%, it is essential to invite fresh tender covering the total revised quantity to get the advantage of bulk discounts.
c)In case of reduction in quantities is more than 0%, confirmation from L-1 bidder would be obtained to supply at the quoted rates. If L-1 bidder does not agree, then tender would be reinvented.
d)In case of tenders like those of pipes for offshore where large quantity is involved, even lower percentage maybe specified in the tender with the approval of Regional Director concerned.
qSALE OF BIDDING DOCUMENTS TO FIRMS WITH WHOM BUSINESS HAS BEEN BANNED/SUSPENDED
The bidding document is sold on receipt of applications along with requisite tender fee. No bidding document will be sold to parties to whom no further business I to be given or dealings with whom have been banned/suspended.
qTENDER FEE
All open tenders exceeding Rs.5.00 lakhs are issued after making the necessary entries in the tender register against payment of prescribed tender fee.
qPURCHASE OF BIDDING DOUMENTS BY AGENTS IN INDIA
In respect of imports, the agents in India, duly authorized by their foreign principals, are allowed to purchase bidding documents in Indian currency through a bank draft drawn in the favour of ONGC provided such foreign principal/supplier remit the cost of bidding documents in foreign currency equivalent to Indian Rupees through a bank draft/Cashier's cheque/Banker's cheque in favour of ONGC along with their offer before the due date.
qCANCELLATION OF TENDER- REFUND OF TENDER FEE
In case tender is cancelled the tender fee will be refunded to the concerned bidder.
qEXEMPTION FROM PAYMENT OF TENDER FEE
The firms registered with NSIC are exempted from payment of tender fee irrespective of the monetary limit mentioned in their registration certificate provided they furnish evidence that the are registered ofr the items they intend to quote against ONGC tenders.
qFREE OF COST BIDDING DOCUMENT TO TRADE COMMISSIONS/ CONSULATES / REPRESENTATIVES OF FOREIGN GOVTS.
Two specimen of bidding documents for imported materials will be sent free of cost to Trade Commissions/Consulate/Representatives in India of foreign governments.
OPENING OF TENDERS
qOPENING OF TENDERS
a)The tender are opened only on limited days to save time. Every section, while issuing enquiry will ensure that only the following dates of the month are given as due dates ,5,7,,11,1,15,17,1,1,, 5, 7,, 1. with exception for Sundays Gazetted holidays and in case of emergency.
b)Tenders are opened at 1500 hrs. on the day they are to be opened.
c)A team of two officers opens them.
qNUMBERING OF TENDERS / DISCLOSURE OF PRICES / READING OUT RATES
a)The Tender Opening Officers encircle the rates & terms & conditions and put their initials.
b)Reading out the rates; in the public opening only the total prices or group wise prices, if sought as per tender should be read out in addition to delivery schedule & major terms & conditions.
qDISCLOSURE OF PRICES
Bids are to be treated as confidential documents & saved at the time of public opening of tenders, prices quoted are not to be disclosed to any member of the staff without permission of the general manager/DGM/Head of Project/ Head of business Group
qOPENING OF TENDERS
a)Unless good and sufficient reasons exist all bids including bids for service contracts, estimated cost Rs.50,000 & above must as a rule are opened in the presence of bidders/ Authorized representatives of bidders.
b)The officers opening the tenders verify that only bidders / Authorized representatives of bidders who have actually submitted the bids are present.
CANCELLATION / RE-INVITATION OF TENDERS
qCANCELLATION OF TENDERS
a.A tender shall be deemed to have been cancelled to the extent a demand is withdrawn. Advice regarding the cancellation action shall be conveyed to the indentor.
b.Cancellation of tenders for any other reason, to be recorded in writing, shall require the approval of the purchase authority one step higher than the competent purchase authority. However, in all such cases the Purchase Committee consisting of Director of concerned Business Group and Director (Finance) will be final authority.
qRE-INVITATION OF TENDERS
a.In the event of re-invitation of bids whether on a limited or open tender basis the Competent Purchase Authority will obtain in advance the decision of the Purchase Authority one step higher. In respect of proposals falling under the preview of Executive Purchase Committee, the decision for re-tendering will be taken by concerned Director in consultation, with Chairman-cum-Managing Director.
b.Such re-invitation of bids, on a limited basis, will be from all the bidders who quoted against the original tender.
c.Similarly, in the case of open tenders intimation regarding re-invitation of tenders will be sent to all the bidders who quoted against the original tender.
d.Reasons for re-invitation of tenders in all the cases will be recorded.
CLAUSES IN TENDER/SUPPLY ORDERS
qWARRANTY AND GUARANTEE
a.In the case of equipment, the warranty for a period of 18 months from the date of shipment or 1 months from the date of commissioning of the equipment, whichever is earlier, will be obtained.
b.The warranty period in case of turnkey projects will be obtained for 1 months from the date of satisfactory commissioning and handling over of the complete project to the ONGC.
c.The Bank Guarantee for warranty period in the case of equipment will not be necessary. The Bank guarantee for warranty in the case of Turnkey Project contracts will be essential, insisted upon and failure to comply with this will be rejection criteria of the BEC.
qWARRANTY CLAUSE
The manufacturer warrants that everything to be furnished here under shall be free form all defects and faults in material, workmanship and manufacture and shall be of the highest grade and consistent with established and generally accepted standards of the material of the type ordered and in full conformity with the specifications, drawing for samples, if any, and operable, operate properly.
qPENALTY/LIQUIDATED DAMAGES/CANCELLATION CLAUSE
a.No liquidation damages clause will be inserted in contracts/supply orders for purchases upto Rs. 1.00 lakh. Supply order as per STR-40 will be placed for purchases up to Rs. 1.00 lakh, which provides for cancellation clause.
b. In case of contracts/Supply Orders exceeding Rs. 1.00 lakh, liquidated damages will be applicable @ ½ % of the contract supply order value per week or part thereof for delay in supplies subject to a maximum ceiling of 5% of supply order/contract value. In case of service contract for a period of more than one year, the liquidation damages will be livable on one year's contract period value.
qLIQUIDATION DAMAGES/FAILURE AND TERMINATION CLAUSE
a.Procurement of goods
Time and date of delivery shall be essence of the contract. If the contractor/supplier fails to deliver the stores, if or any installment thereof within the period fixed for such delivery in the schedule or at any time repudiates the contract before the expiry of such period the purchaser may, without prejudice to any other right or remedy, available to him recover damages for breach of the contract.
i.Recover from the Contractor/Supplier as agreed liquidated damages and not by way of penalty, a sum equivalent to ½ % of contract price of the whole unit per week for such delay or part thereof which the contractor has failed to deliver within the period fixed for delivery in the schedule, where delivery thereof is accepted after expiry of the aforesaid period.
ii.Cancel the contract/supply order or a portion thereof by serving prior notice to the contractor/supplier.
iii.It may further be noted that clause (a) above provides for recovery of liquidated damages on the cost of contract/supply order price of delayed supplies at the rate or ½ % of the contract/supply order price of whole unit 1% of total value of particular item in case of casing pipes per week of such delay or part thereof up to a ceiling of 5% of contract/supply order price of delayed supplies.
iv.Notwithstanding anything stated above, equipments and materials will be deemed to have been delivered only when all its components and parts are also delivered. If certain components are not delivered in time, the equipments and materials will be considered as delayed until such time all the missing parts are also delivered.
b.FALL CLAUSE
i.The Price charged for material supplied under the contract / supply order by the contractor/supplier shall in no event exceed the lowest price at which the supplier/contractor or his agent sells the material or offers to sell materials of identical description to any person/organizations including the purchaser or any deptt. of the Central Govt. or any deptt. of State Govt.
ii.If any time , during the said period the contractor/ supplier or his agent/principal/dealer, as the case may be, reduces the sales price sells or offers to sell such materials to any persons/organizations including the purchaser or any deptt of central govt or any dept of state govt as the case may be at a price lower than the price chargeable under the contract/ supplier order , he shall forthwith notify such reduction or sale or offer of sale to the purchase authority who has issued this supply order and the price payable under the order/contract for the materials supplied after the date of coming into the force of such reduction or sale or offer of sale shall stand correspondingly reduced.
iii.The contractor/supplier shall furnish the following certificate to the concerned paying authority along with each bill for payment for suppliers made against this supply order/contract.
We/I certify that there has been no reduction in sales price of the materials of description identical to the materials supplied to the ONGC under the contract/supply order herein and such materials have not been offered/sold by me/us to any person/organization including the purchaser of any organization including the purchaser of any deptt of central govt or any dept of state govt as the case may be up to the date of bill/during the currency of the supply order/contract whichever is later ,at a price lower than the price charged to the ONGC under the contract/supply order except for quantity of materials categories under sub clauses(a),(b),(c) of subpara above details of which are as follows-
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qINSPECTION AND REJECTION OF MATERIALS BY CONSIGNEES
When the materials are rejected by the consignees , the materials management officer concerned will intimate to the contractor the details of such rejected stories as well as the reasons of their rejection and that the materials are lying in the consignees premises at the risk and the cost of the contractor. he will also call upon him either to remove the materials or to give instructions as to their disposal within 14 days and in case of dangerous infested and perishable stores within 48hours,failing which the consignee will either return the materials to the contractor freight to pay or other wise dispose them of at the contractors risk and cost.
qSUBLETTING AND ASSIGNMENT
The contractor shall not, save with the previous consent in writing of the purchase authority, sublet, transfer or assign the contract or any part thereof or interest therein or benefit or advantage thereof in any manner whatsoever provided nevertheless that any such consent shall not relieve the contract from any obligation, duty or responsibility under the contract.
qEARLIER DELIVERY
When contracts are placed at higher rates for the sake or earlier delivery, the clause as given below enabling the ONGC to realize compensation for the extra cost due to delay in supply must be included therein-
it should be noted that on your assurance of earlier delivery this order has been placed on you in preference to the lowest acceptable bid in case of failure to complete supplies against this contract in terms thereof within the date of delivery specified herein. you would be liable to pay the ONGC the difference the contract rates and those of the lowest acceptable bid i.e. Rs per unit , not-withstanding the fact that the delay in supply may have been caused by the force majeure. This is without prejudice to the right of the ONGC to recover all other losses and damages resulting from delayed supplies, including right of cancellation".
qTHE FOLLOWING CLAUSE WILL INVARIABLY BE INCLUDED IN ALL INVITATION FOR BIDS-
it should be noted that if a contract is placed on a higher bidder as a result of this tender, in preference to the lowest acceptable offer, in consideration to the earlier delivery , the contractor will be liable to pay the ONGC the difference between the contract rate and the rate quoted by the lowest acceptable bidder in case he fails to complete the supply in terms of such contract within the dates of delivery specified in the tender and incorporated in the contract. This is right in prejudice to the right under terms of contract".
qPILOT APPROVAL (WHEREVER APPLICABLE)
a. Before commencing bulk supply, you would forward two sets of samples forwarded by two sets of your manufacturing drawing for approval of the inspecting officer. Such an approval by the inspecting officer may take at least 15 days time, which should be catered by you within the delivery schedule
b.You will make available free of charge all testing facilities in your plant to the inspecting officer to enable him to carry out inspection. You will arrange for ant test desired by the inspecting officer. if facilities for such tests are not available in your plant in the latter case, the test charges would be reimbursed by the purchaser if the samples are considered acceptable , whereas if the samples are not found acceptable ,the test charges would be borne by you
qBULK INSPECTION (WHEREVER APPLICABLE)
a. The bulk shall be accepted in accordance with the samples approved .The inspector shall be given sufficient notice which shall not be less than 1 working days to plan out the bulk inspection. You should arrange percentage on the same lines as in case of the pilot samples and the test charges would be dealt with accordingly.
b. Sampling procedure will be as per the requirement of the inspection authority
c. The materials rejected by the inspection officer during this inspection will be replaced by you immediately,atleast within two weeks of such rejection .any rejection by the inspecting officer shall be considered final and binding on you.
qEMAIL / TELEGRAPHIC/FAX OFFERS
Telex/telegraph/fax copy of the offers will not be accepted. However, in OEM purchases from single source or where source of supply is pre fixed. Telex/fax/telegraphic/e mail offers may be considered provided such offers are followed by confirmatory copy within 15 days of the date of receipt of offer.
qARBITRATION CLAUSE
a. For indigenous contracts up to Rs 1.00 crore 'sole arbitration 'clause will be applicable.
b. For indigenous contracts exceeding Rs 1.00 crore and for all foreign contracts" two arbitrators and one umpire" clause will be applicable.
c. For public sectors, the arbitration clause as per govt directives will apply.
qSUBMISSION OF TENDER SAMPLES AFTER OPENING OF TENDERS
The belated submission of tender samples (wherever these are required),unnecessarily holds up decision on tenders .it will be made clear to the bidding firms by insertion of a suitable clause in bidding documents that samples ,whatever required, should be sent along with offers reach before closing time of tender failing which the offer shall be ignored straight away.
qSCALE OF REBATE
a. In all invitation for bid the " instructions to bidder" and the condition of contract should include the following condition -
The minimum percentage of rebate should be considered for early payment should be as under -
(1) Bills up to Rs 5000 %
() Bills above Rs 50001%
qCATALOGUES AND MANUAL IN CASE OF NEW BUYS
In case of new buys provisions will be made in bidding documents and supply order to the effect the supplies will send catalogue manual of relevant items to inventory control cell under the intimation to order placing authority within two months.
qGENERAL CONDITIONS
a.When the materials are dispatched to the consignee. Intimation must also begiven to this effect to the purchasing authority and also to the consignee. Reference to the supply order should invariably be given in all relevant correspondence.
b. The bid is liable to be rejected in case the bidder does not comply with the tender stipulations or the goods offered do not conform to the required specifications indicated therein.
c. Any other terms and conditions offered by the firm and not included in this supply order are not acceptable to the ONGC.
PURCHASE POWERS
S.No.Purchase of materials, hiring of servicesAUTHORITYExtent of Power
1.Approve extension of delivery date in respect of a supply order/contracts other than Development orderCompetent purchase authorityFull powers subject to conditions1.Ext. of delivery date shall be allowed only against written request by suppliers when there are valid reasons that records should be kept.Ext of delivery dates will be given with consultation of finance where order has been placed on higher prices in preferences to the lowest offer in consideration of early delivery or where order is placed as a result of supplier's improvrment in delivery period.Indenter will be consulted for giving ext. in delivery period where it is specifically indicated in the indent that supplies should be completed by specific date and no consent on delivery would be given without permission.
.Approve extension of delivery date in respect Development orderCompetent purchase authority1.Up to one yr of the expir5y of initial period.Depending upon the merit of the case, any ext. in delivery period beyond one year of the expiry of initial delivery period will be granted with director's permission..Instructions to be followeda) Liquidated Damage clause will be in corporate in all development ordersb) Any ext. in delivery date without imposing liquidated damages will be granted with prior concurrence of financec) Time lost due to delay on the part of the corp. will be taken into consideration And so forth delivery period could be extended
.Decide in a case of failure to complete supplies with-in contracted delivery period the quantum of liquidated damages & to levy the sameCompetent purchase authorityFull powers in consultation with finance& the indenter, in accordance with the condition of supply order.
4.Waive recovery of liquidated damagesCompetent purchase authorityFull powers in consultation with finance& the indenter at corresponding level
5.Release earnest money deposits & security depositsCompetent purchase authorityFull powers at corresponding level
6.Relaxation of condition relating to EMD/security deposits.DirectorFull Powers Empowered for relaxation /waiver condition based on merit of each case upto their sanctioning powers.
7.Post contract issues & negotiations during Pre-award stageCompetent purchase authorityFull PowersUpto Epc Related cases concerned directors, Director (F)& CMD
8.Ext. of tender opening dateCompetent purchase authorityMax. up to weeks
ME Emergency Purchase
S.No.Items LEVEL -1LEVEL -LEVEL -LEVEL -4
1.Emergency purchase of capital items / fabrication, manufacturing.Rs.10 Lakh-Rs.5000Each Case
MD Power of disposal & discarding
S.No.Disposal & discardingAuthorityExtent of Power
1.Discard declare fit for disposal & approve reserve priceLEVEL -1Where the book Value is upto Rs. 100 Lakh in each case
.Scrap, Unserviceable stores and spares, packaging boxes, empty containers & POL drumsLEVEL -Where the book Value is upto Rs. 100 La Lakh in each case Where the book Value is upto Rs. 0 Lakh in each case
4.Machinery, Equipment & vehicles which have become obsolete as per guidelines issued by HQLEVEL -1Full Powers
5Machinery, Equipment & vehicles which are unserviceable under economic repairLEVEL -1LEVEL -Where the book Value is upto Rs. 0 Lakh in each caseWhere the book Value is upto Rs. 5Lakh in each case
6Machinery, Equipment & vehicles which do not fall under preview of obsolete ass per guidelines LEVEL -1LEVEL -Where the book Value is upto Rs. 100 Lakh in each caseWhere the book Value is upto Rs. 0Lakh in each case
7Approve disposal with respect of item 1. to 5.LM-warehouse/CMLO/RCMLOLM-warehouse MM/CMLO/RCMLOLEVEL-1 /MMReserve review of reserve priceDisposal bid in terms of reserve price a) Full Powers where the disposal bid is equal or moreLess than 100% to 75%Less than 75% to 50%Less than 50%
8Enter into a running contract with affirm for the periodicals disposal of waste papers, scraps ,empty containers ,packaging boxes etc.LM-warehouse/MMFull powers with finance &legal Vetting
Enter into agreement with a reputed firm of auctioneers, for sale by auction of assets &other material declared for disposals LMFull powers with finance &legal Vetting
10Authorise sale of packaging boxes, empty container & POL barrels to employeesMMFull powers at reserve price
11Approve disposal with respect of newspaper, periodicalsMMFull powers
S.NoPurchase of material, hiring of servicesAuthorityExtent of Powers
1Approve empanelnment of firms for supply of various oil specific itemsConcerned DirectorFull Powers
Approve empanelnment of firms for supply of various general nature itemsa). Level I/E/E8b) Chief MM for HQRS/ Hear of Regional officeFull PowersFull PowersNote 1.Empanelment of firms for supply of various oil specific items to be approved by concerned Director an standing basis after concurrence by the head of the institute/office.. Empanelment of firms for supply of oil specific items will be done in accordance with the prescribed procedure..De empanelment of firms requires approval of competent authority.
Invite Open Tender (MM)Full powers in accordance with prescribed procedure.NoteOpen tenders shall be invited as per prescribed procedure.
4Invite Limited Tender(MM)Full powers in accordance with prescribed procedure.
A - 1Open tender where committee is required Asset Manger / Basin Manager/ Plant Manager / Chief of Services / Chief of MM(HQ) / Head of Institute / Head Regional Office / Chief off shore supply base. IA 5 crores, IB 15 crores, IC 10 crores, ID 5 crores, IE 1 crores, Chief MM 5 crores.
Head MM of Asset / Basin / Plant / Institues / Regional / Services / other offices where MM formation existsSecond Level of MM of Asset / Basin / Plant / Institutes / Regional / Services / other offices where MM formation existsMM Executives E4 and above where he /she is not designated as second level MM Upto Rs. 5 crores in respect of Asset / Basin / Managers Services and other Chiefs having levels-IA PowersUpto Rs. crores in respect of Asset / Basin / Managers Services and other Chiefs having levels-IB PowersUpto Rs. crores in respect of Asset / Basin / Managers Services and other Chiefs having levels-IC PowersUpto Rs. 1 crores in respect of Asset / Basin / Managers Services and other Chiefs having levels-ID PowersUpto Rs. 0 Lakhs levels-IE PowersUpto Rs. 50 Lakhs in respect of Asset / Basin / Managers Services and other Chiefs having levels-IA PowersUpto Rs. 0 Lakhs in respect of Asset / Basin / Managers Services and other Chiefs having levels-IB PowersUpto Rs. 0 Lakhs in respect of Asset / Basin / Managers Services and other Chiefs having levels-IC PowersUpto Rs. 10 Lakhs in respect of Asset / Basin / Managers Services and other Chiefs having levels-ID / IE PowersUpto Rs. 5 Lakhs in respect of Asset / Basin / Managers Services and other Chiefs having levels-IA/B PowersUpto Rs. Lakhs in respect of Asset / Basin / Managers Services and other Chiefs having levels-IC/D/E PowersConstitution of tender committee the following levels of MM & Finance officers and user Deptt shall form pert of the committee. Wherever user deptt & concerned indenting deptt/technical deptt are different representative of both these deptts at the same level mentioned below will be members of the tender committee.Tender Committee Amont(Rs.)Head MM5 crs and aboveFince/User dept E 51 crs - 5 crsE4 50 lkhs 1 crsE 15 lkhs 50 lkhsE8 lkhs 15 lkhsE1 lkhs 8 lkhs
Limited Tender where tender committee is requiredSame as A - 1In respect to limited tender power shall be restricted to 75% of A-1
Single tender on PAC tender where tender committee is required Same as A - 1In respect of limited tender power shall be restricted to 50% of A-1
Single tender on nomination basis tender where tender committee is requiredSame as A - 1In respect to single tender nomination basis power shall be restricted to 5% of A-1
Board PurchaseNote for purchase through board of officers as per procedure desired in MM manuals. Executive below E4 level also enjoys purchase powers.EEE1Rs lakhsRs 1.5 lakhsRs 50,000
Open tender where tender committee is not requiredWhen supply order/contract is proposed to be placed on the offer which is not lowest amongst all the offers received in the tenderWhen supply order/contract is proposed to be placed on the lowest offer amongst all the offers received in the tender
Asset Manger / Basin Manager/ Plant Manager / Chief of Services / Chief of MM(HQ) / Head of Institute / Head Regional Office / Chief off shore supply base.Head MM of Asset / Basin / Plant / Institues / Regional / Services / other offices where MM formation existsSecond Level of MM of Asset / Basin / Plant / Institutes / Regional / Services / other offices where MM formation existsUpto Rs 10 LakhsUpto Rs LakhsUpto Rs 0,000Upto Rs 75 LakhsUpto Rs 15 LakhsUpto Rs 1.5 Lakhs
Note powers will be execerised subject to the following conditionsi) Competition is not lackingii) Rates are applicablefor tenders of value less than Rs 50,000 purchase shall be finalized with concurrence of finance if the lowest acceptable offer is not operated.
When the majority recommendations of the tender committee are not acceptable or where equally divided ( in the case of four members) recommendations of the tender committeeAuthority next higher to those indicated in item no. PMS4 of the extent of power wher tender committee are heldPowers as A-1 but with the concurrence of finance t commensuratrion level will be obtained.
Signing and place of supply order for stores, spares and capital items and for signing contracts for services and turnkey projects.Level I/E 7(MM)E6 (MM)E5 (MM)E4 (MM)E (MM)E (MM)E1 (MM)Full powersUpto Rs.10 croresUpto Rs.5 croresUpto Rs.100 lakhsUpto Rs 50 lakhsUpto Rs 5 lakhsUpto Rs 7.5 lakhs
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