Final All chapters[1] - CGDA - Controller General of ...

1 INDEX S. NO. CONTENTS PAGE NO. CHAPTERS 1. chapter -1 : INTRODUCTION 1 2. chapter -2 : PROCUREMENT OBJECTIVE AND POLICY 8 3. chapter -3 : SOURCING AND QUALITY 17 4. chapter -4 : TENDERING 22 5. chapter -5: APPROVAL PROCESS AND CONCLUSION OF CONTRACT 47 6. chapter -6 : CONTRACT 54 7. chapter -7 : CONDITIONS OF CONTRACT 63 8. chapter -8 : RATE CONTRACT 79 9. chapter -9 : PROCUREMENT OF GOODS AND SERVICES FROM FOREIGN COUNTRIES 86 10. chapter -10. : STANDARD CONDITIONS OF CONTRACT - FOREIGN PROCUREMENT 103 11. chapter -11 : REPAIR CONTRACTS WITH FOREIGN AND INDIGENOUS FIRMS 112 12.

2 chapter -12 : BANKING INSTRUMENTS 117 13. chapter -13 : EVALUATION OF QUOTATIONS AND PRICE REASONABILITY 125 14. chapter -14 : OFFLOADING OF PARTIAL/ COMPLETE REFITS/REPAIRS OF SHIPS/ SUBMARINES/CRAFTS/ASSETS TO INDIAN PSU/PRIVATE SHIP YARDS/TRADE 134 15. chapter -15 : DESIGN, DEVELOPMENT AND FABRICATION CONTRACTS 142 APPENDICES 16. Appendix A TIME FRAME FOR PROCUREMENT 159 17. Appendix- B FORMAT FOR THE STATEMENT OF CASE (SOC) 160 Annexure-A 164 Annexure-B 165 18. Appendix C SUBSIDIARY INSTRUCTIONS TO BUYER FOR FRAMING REQUEST FOR PROPOSAL (RFP) 166 Part-I 169 Part-II 172 Part-III 175 Part -IV 184 Part- V 210 19.

3 Appendix- D SUBSIDIARY INSTRUCTIONS TO BUYER FOR FRAMING SUPPLY ORDER 214 Part-I 214 Part-II 217 Part-III 218 Part -IV 225 Part- V 250 20. Appendix- E SUBSIDIARY INSTRUCTIONS TO BUYER FOR FRAMING CONTRACT 251 Part-I 252 Part-II 254 Part-III 255 Part -IV 262 Part- V 286 21. Appendix- F DRAFT SUPPLY ORDER AGAINST RATE CONTRACT 287 22. Appendix- G REQUEST FOR PROPOSAL (RFP) 289 Enclosure-I 289 Enclosure-II 293 Enclosure-III 294 Enclosure-IV 295 Enclosure-V 296 Enclosure-VI 298 Enclosure-VII -- Enclosure-VIII -- 23.

4 Appendix- H STANDARD CONDITIONS OF CONTRACT FOR PARTIAL/COMPLETE REFIT/ REPAIRS OF SHIPS/SUBMARINES/MARINE AND SERVICE ASSETS 299 24. Appendix- I DRAFT AGREEMENT FOR DESIGN, DEVELOPMENT AND FABRICATION CONTRACTS 321 25. Appendix- J FABRICATION CONTRACT 325 26. Appendix- K FORMAT FOR ISSUING SANCTIONS 328 FORMS of DPM 27. DPM -1 329 28. DPM -2 339 29. DPM -3 346 30. DPM -4 349 31. DPM -5 351 32. DPM -6 355 33. DPM -7 359 34. DPM -8 360 35. DPM -9 362 36. DPM -10 363 37. DPM -11 370 38. DPM -12 371 39. DPM -13 373 40. DPM -14 374 41. DPM -15 376 42. DPM -16 378 43. DPM -17 380 44. DPM -18 382 45. DPM -19 384 46. DPM -20 386 47. DPM -21 388 48.

5 DPM -22 389 49. DPM -23 390 50. DPM -24 392 51. DPM -25 393 52. DPM -26 395 53. DPM -27 397 54. DPM -28 399 55. DPM -29 400 1 chapter 1 INTRODUCTION Short Title and Commencement This Manual may be called the Defence Procurement Manual, 2009 (DPM 2009, for short). This Manual contains principles and procedure relating to procurement of goods and services for the Defence Services, Organizations and Establishments, laid down in terms of Rule 135 of the General financial Rules, 2005 and shall come into force with effect from 1st of April 2009. All on-going cases of procurement in which Request for Proposal (RFP) has already been issued may continue to be regulated by the provisions of the Defence Procurement Manual, 2006.

6 Applicability The principles and procedures contained in this Manual are to be followed by all wings of the Ministry of Defence and the Defence Services, as well as all organizations and units/establishments thereunder, for procurement of goods and services, expenditure on account of which is met from the revenue heads of the Defence Services Estimates (DSE) and any other type of purchases to which the provisions are made specifically applicable. The procedure laid down in this Manual shall also be applicable to the following: (a) the Coast Guard Organization and Jammu & Kashmir Light Infantry (JAKLI) for procurement under the revenue heads for which budgetary allocation is made in the Demand for Grant of the Ministry of Defence (Civil); (b) procurement of certain capital items, as notified by the Ministry of Defence from time to time; (c) procurement of medical equipment, both under revenue and capital heads.

7 And (d) purchases made by the Defence Services from grants placed at their disposal by other Ministries/Departments like the Ministry of Home Affairs, Ministry of Environment and Forests, etc. 2 The procedure laid down in this Manual shall be followed for central procurement as well as local purchases under delegated financial powers of authorities in the Ministry of Defence, Service Headquarters and all subordinate authorities in the Command Headquarters, lower formations, establishments and units thereunder at all levels. Scope The term procurement means acquiring all types of goods (both scaled and non-scaled), such as equipment, stores, spares, technical literature, etc.

8 , as well as all types of services, including packing, unpacking, preservation, transportation, insurance, delivery, special services, leasing, technical assessment, consultancy, systems study, software development, maintenance, updates, conservancy, etc. Definitions Unless the context requires otherwise, the terms used in this Manual will have the meaning as described herein below. Authority Holding Sealed Particulars (AHSP): AHSP is the authority responsible for collecting, collating, developing, amending, updating, holding and supplying sealed particulars of the defence items in accordance with the laid down procedure.

9 AHSP may be the Director General of Quality Assurance (DGQA) or an authority in the Service Headquarters for service specific items. Similar responsibility for the Naval and Air Force equipments rests with respective service headquarters. Ordnance Factories are the AHSP for certain types of B vehicles and items issued to indentors, other than the defence services. DGAQA is the AHSP for aviation stores of all the Services and the Coast Guard. Procurement officers, the suppliers and the Inspection Agencies are required to comply with the specifications drawn up by the AHSP. Competent financial Authority: The Competent financial Authority (CFA) is an authority duly empowered by the Government of India to sanction and approve expenditure from public accounts upto a specified limit in terms of amount of such expenditure and subject to availability of funds.

10 All financial powers are to be exercised by the appropriate CFA. Where financial powers have been delegated to more than one authority under the same Serial/Head, authority with higher delegated financial powers will constitute the next higher CFA . Contract: A proposal or offer when accepted is a promise, a promise and every set of promises forming the consideration for each other is an agreement and an agreement, if made with free consent of parties 3 competent to contract, for a lawful consideration and with a lawful object, is a contract. Direct Demanding Officers: The authorities in the Services/ Departments/establishments/units/hospita ls etc.