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PURCHASE POLICY MANUAL

Effective from October 21, 2012

Published by:
Transport Corporation of India Limited
TCI House, 69 Institutional Area
Sector 32, Gurgaon 122207, India
Tel: +91-124-2381603-07
Fax: +91-124-2381611
Website: www.tcil.com
Email: munish.chander@tcil.com

The purchase policy manual enacted pertains to purchase method for indigenous and imported items, their
classification, general procedure and rules for purchases, payment terms, maintenance of records, stocks
verification, write off and disposal procedures.

CONTENTS

Article No.
I
II
1.0
2.0
3.0
3.1
3.2
3.3

4.0
5.0
6.0
6.1
6.2
6.3
6.4
6.5
6.6
6.7
6.8
6.9
6.10
6.13

7.0
8.0
9.0
10.0
11.0
12.0
13.0
14.0
15.0
16.0
17.0
20.0
21.0
22.0
23.0
24.0

Content
Forwarded by the Managing Director
Objective of Purchase Policy Manual
Introduction
Abbreviation and Definitions
Classification of Stores
Non Consumable Stores (NCS)
Limited Time Asset Stores (LTAS)
Consumable Stores (CS)
Financial & Sanctioning Power
Category of Firms, Registration & Blacklisting
General Procedures & Rules for Purchases
Purchase of Goods without Quotation
Purchase of Goods by Purchase Committee
Purchase of Goods in Emergency Situations
Purchase of Goods with Quotation
Purchase of Proprietary Article/Item
Repeat Order
Purchase under Rate Contract Goods
E-procurement & Reverse Auction
Purchase Under buy back scheme
Two Bid System
Invitation of Quotation/Bid/Tender Procedure
Payment Terms
Liquidated Damages (Late Delivery)
Purchase Approval and Receipt of Items
Duties & Taxes
Annual Maintenance Contract
Purchasing of Import items
Import purchasing through individual international Credit Card
Maintenance of Record
Stores Audit
Transfer of Stores
Write off, Condemnation and Disposal
Discretionary Powers of M.D./J.M.D.
Conflict of Interest
Ethical Considerations
Relations with Vendors
Relations with other Departments

Page No.
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4
5
5
6
6
6
7
7
8
9
9
10
10
11
12
13
13
13
14
14
15
16
17
17
19
19
19
21
21
23
23
23
26
27
28
29
31

ANNEXURES
Annexure-I
Annexure-II
Annexure-III
Annexure-IV
Annexure-V

Purchase Proposal Request Form


Purchase Proposal Request Form (Imported Items)
Supplier Registration Form
Supplier Renewal Form
Proprietary Certificate Form

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33
34
35
36

FORWARDED BY MANAGING DIRECTOR


The purchase policy manual encompasses all purchasing procedures
as approved by the Management. The policy statements contained in
this manual represent the basic intentions and goals of the company.
They establish the permanent foundation upon which the company
operates and are expected to be relatively independent of the
changing technologies and methods used to carry them out.
These policies are subject to change from time to time as
circumstances dictate, and these changes, when approved by the
Management, will be disseminated to all concerned.
We would like to maintain the highest level of ethics in Purchasing and deal with our
suppliers on a uniform basis. The professional contribution by Dr. Munish Chander
General Manager TCI is of paramount importance in the enactment and implementation
of this policy. I thank TCI Group Division/Department Heads for their involvement and
valuable inputs during the draft discussion period.
The indispensible Purchase Policy will come into effect from October 21, 2012 and
applicable to TCI Group and its subsidiaries including all Divisions, Departments and
Sections. All Division/Department Heads and Central Purchase Section are advised to
adhere to the TCI Purchase Policy in true spirit of professionalism.

D.P. AGARWAL
MANAGING DIRECTOR

OBJECTIVE OF PURCHASE POLICY MANUAL


The overall objective of Purchase Policy Manual is to procure quality products and
services in the most cost-effective manner and satisfy the Companys requirements on a
timely basis, consistent with Company objective while maintaining the highest ethical
standards. Central Purchase Section of TCI Group and its subsidiaries at Corporate
Office (Central Purchase Section) shall aim to acquire these quality products and services
in a cost effective manner.
In support of this objective, the TCI Group and its subsidiaries Divisions, Departments
and Central Purchase Section will:

Comply, in all respects, with all applicable laws and regulations without condition
or evasion.
Ensure the uninterrupted services of TCI Group by obtaining and ensuring
delivery of acceptable quality goods and services, at the right time and price.
Resolve complaints on all purchased goods and services.
Provide leadership in the standardization of materials, supplies, equipment, and
services.
Provide leadership for the management of inventories of purchased goods so as to
meet the requirements of the company and its subsidiaries at the lowest possible
cost.
Dispose of, to the best advantage, all material and equipment declared to be
surplus or obsolete. All disposal activities shall be conducted in a manner that
does not compromise the environment.
Establish and maintain effective communication channel which fosters a learning
and growth environment, promotes a team concept and value an individuals
skills, knowledge and performance of responsibilities.
Give prime consideration to the company and its subsidiaries interests while
seeking to maintain and further long-term, mutually profitable, ethical supplier
relationships.
Carry out the policies of the company so that the best interests of the company are
served. Develop and keep up to date a purchasing manual outlining the
organization, policies and procedures by which goods and services are to be
procured throughout the Company and its subsidiaries and ensure that the
Company and its subsidiaries divisions/departments operates according to these
policies.
Ensure pertinent information on market conditions, trends, prices, government
regulations, etc. is properly disseminated to relevant personnel within the
company.

Comment: The objective of TCI Purchase Policy Manual is to maintain highest ethical standards of the TCI
Group and its subsidiaries.

STORES & PURCHASE MANUAL


1. Introduction
This manual outlines the procedures to be adopted for the purchase of various kinds of equipment
and stores by the TCI Group and its subsidiaries.

2. Abbreviations and Definitions


2.1. Abbreviations
AS
CA
CEO
C.M.
CS
CFA
CPS
CRPO
D.G.M.
e-data
FA Head
Firm
HOD
IA
IR
J.M.D.
LTAS
M.D.
NCS
Office
PPF
RC
R.M.
TCI Group
Z.M.
-

Account Section
Competent Authority
Chief Executive Officer
Controlling Manager
Consumable Stores
Competent Financial Authority
Central Purchase Section of TCI Group & its subsidiaries at CRPO
TCI Group Corporate Office at Gurgaon, Haryana, India.
Deputy General Manager
Stores records saved as electronic data.
Functional Area Head
Supplier/Dealer/Agent/Distributor/Stockiest/Manufacturer/Service Provider

Head of the Department


Internal Audit
Inspection Report
Joint Managing Director
Limited Time Asset Stores
Managing Director
Non-Consumable Stores
Corporate/Regional/Controlling/Branch or any entity in the Company
Purchase Proposal Form
Rate Contract
Regional Manager
TCI Companies, Associate Companies, Joint Ventures and Divisions
Zonal Manager

2.2. Definitions
Approved format: At different places in this document reference is made to approved
formats. All such formats shall be approved by the M.D./J.M.D. from time to time. The
approved formats, as at present, are enclosed in annexure I to V

Department: In
what
follows,
department
shall imply Corporate Office
Departments/Regional Office/Controlling Office/Branch Office or any entity in the Company.

Comments to Article 1: The Purchase Policy is applicable to all offices including but not limited to divisions,
departments, sections, units of TCI Group and its subsidiaries, in India and foreign countries.

Purchaser: The individual who signs as purchaser in the purchase proposal form shall be
referred to as a purchaser.
Seller: A seller refers to the company/vendor/dealer/agent/individual party from whom the
Company may potentially buy goods or services.
Temporary Contingent Advance: It is an advance which can be taken to meet contingent
expenses on NCS/LTAS/CS/Miscellaneous items. This should normally be taken from the
appropriate budget head.
Rate Contract: A Rate Contract (commonly known as RC) is an agreement between the
purchaser and the suppliers for supply of specific goods and allied services, if any, at
specified price and terms and conditions during the period covered by the Rate Contract.

3. Classification of Stores
All stores to be procured shall be classified into three categories viz,
Non-Consumable Stores (NCS),
Limited Time Asset Stores (LTAS), and
Consumable Stores (CS).
3.1. Non-Consumable Stores (NCS):
Stores satisfying any one of the following conditions shall be classified as non-consumable
stores:
3.1.1. stores which are intended to be used over prolonged periods before becoming
unusable, or obsolete,
3.1.2. stores having a significant disposal value,
3.1.3. stores which are sub-systems, or parts of an equipment, which can be potentially
repaired and reused, and
3.1.4. stores which are either fabricated, or assembled equipment, and which if bought as
a single item would have been classified Non-Consumable Stores.
All non-consumable stores have to be entered into the Asset Register of TCI Group and the NCS
Stock Register of the concerned division/department in addition to the e-data entry.
Examples: (examples are indicative and not exhaustive) plant machinery, equipment, fabricated equipment,
instruments, assembled instruments, motors, gas cylinder, workshop machines, furniture and books etc.

3.2. Limited Time Asset Stores (LTAS):


Stores satisfying any one of the following conditions shall be classified as LTAS.
3.2.1. stores which have significant value when purchased but rapidly lose their
value/relevance with the lapse of time and have very little or negligible disposal
value, and/or
3.2.2. stores which can be upgraded either by replacing components/parts or which can
be rendered obsolete by the release of new versions or editions.
All LTAS shall be entered into the Limited Time Asset Stores Register of TCI Group and in a
separate LTA Stock Register of the concerned division/department in addition to the e-data entry.

Examples: (examples are indicative and not exhaustive) Computers, disk and other peripherals drives which are
computer accessories, software, printers, monitors, UPS, telephones, mobile etc.

3.3. Consumable Store (CS):


Stores satisfying any one of the following conditions shall be classified as CS:
3.3.1. stores which exhaust with lapse of time,
3.3.2. stores which are rendered unusable due to normal wear and tear,
3.3.3. stores which do not have significant disposal value, and
3.3.4. spares of equipment which do not fall either in the NCS or LTAS category.
The CS shall be entered in the Consumable Stock register of the concerned division/department in
addition to the e-data entry.
Examples: (examples are indicative and not exhaustive) chemicals, medicines, stationery items, printer ribbons and
cartridges, pen drive, floppies, CD ROMs, magnetic tapes, chips and electronic components like resistors, capacitors,
connectors etc, electrical components like wire switches, plugs, bulbs, cells, tool-bits etc.

If the spares are purchased for fabricating or manufacturing any equipment, such spares are to be
treated as Non Consumable items. However, if a spare is purchased to replacing any spare of an
equipment, such spare be treated as consumable store, provided such spare do not have any
replacement value.
In case of a dispute regarding the classification of an item, the decision of the CEO/FA Head/HOD
of the concerned division/department, as the case may be, will be final.

4. Financial and Approving Authorities:


The following table gives the financial limits up to which the concerned person has authority to
approve purchases within the allocated budget of the Division/ Department. Such a person shall be
referred to as the Competent Financial Authority. It is the responsibility of the Competent Financial
Authority to ensure that sufficient funds are available for the purchase.
S.No.

1.
2.
3.
4.

Competent
Financial Authority
(CFA)

CM/DGM/ZM
RM/HOD
CEO/FA Head
M.D./J.M.D./E.D.

Non Consumables
Store (NCS)

Limited Time
Assets Store
(LTAS)

Consumables
Store (CS)

Temporary
Contingent
Advance

2,00,000
5,00,000
All Financial
Powers

1,00,000
2,00,000
All Financial
Powers

50,000
1,00,000
All Financial
Powers

5,000
10,000
20,000
All Financial
Powers

Note:
1)
2)
3)

The above limits apply to indigenous purchase as well as import. For the purposes of imports the Indian Rupee
equivalent of the foreign currency on the date of approval should be considered.
All purchases of furniture and vehicles should be done through Central Purchase Section after duly approved by
the M.D./J.M.D./E.D.
The financial and approving powers as given above can be revised by M.D./J.M.D. from time to time.

Comments to Articles 3.1, 3.2, 3.3: Stores records entries must be endorsed in the relevant registers in addition to edata. The entries must include minimally bill number, items description, quantity, total value, purchase date.
Comments to Article 4: Before approving any purchase, the competent financial authorities should ensure the allocated
budget, heads specific budget and availability of funds for the remaining financial year.
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5. Category of Firms, Registration/Empanelment & Blacklisting:


There shall be the following categories of firms for inviting quotations for purchase of
materials/services/equipments/instruments etc.

5.1.

Local Registered Firms:

Local
general
suppliers,
authorized
dealers/agents/distributors/stockiest
of
the
manufactures/service providers and firms undertaking job works can be registered with TCI Group
under Supplier Relationship Management (SRM) System as per the procedure mentioned in
annexureIII.
For obtaining such registration the firms should have Service Tax Registration/Tax Payer
Identification Number (TIN) and Permanent Account Number (PAN). The firm must maintain an
office/shop/show room registered in its own name and should have a bank account wherein the
payments may be sent directly in the bank. Credentials including manufacturing capacity, quality
control facilities, past performance, after-sales service, financial background etc. of the firm shall
be carefully verified by the Central Purchase Section.
The registered firms shall be liable to be removed from the list of approved firms if they fail to abide
by the terms and conditions of the registration or fail to supply the goods on time or supply substandard items/goods or make any false declaration to the TCI Group and/or its subsidiaries or for
any other grounds which, in the opinion of the TCI Group and/or its subsidiaries, is considered to
be against the interests of the TCI Group and/or its subsidiaries.
The firm will be registered for a fixed period, normally up to one (1) year, depending on the nature
of the supplies to be made by them. At the end of the period, the registered firms willing to continue
with registration should be required to apply afresh for renewal of registration as per procedure
given in Annexure-IV. New firm may also be considered for registration at any time, provided they
fulfill all the required conditions.

5.2.Outside Firms:
The firms hailing from outside the local area must be manufacturing or authorized
dealers/agents/stockiest/suppliers/service provider of manufacturer. Purchase can be made only
from those reputed sellers who have sales tax registration/CST registration/UPTT
registration/PAN/Tax Payer Identification Number (TIN)/relevant excise registration, wherever
applicable.

5.3.Black listing
Black-listing of firm can be done on the recommendation of CEO/FA Head/HOD of the
division/department and approval of CEO/FA Head of Central Purchase Section. If the black listed
firm rectified itself and wish to be re-registered with TCIL Group, the firm can be included only on
the recommendation of CEO/FA Head of Central Purchase Section and duly approved by the
M.D./J.M.D. The OfficerIn-charge of Central Purchase Section shall process all such cases
reported by the division/department. The information on such firms shall be promptly and widely
disseminated by OfficerIncharge of Central Purchase Section to all concerned.
Comment to Article 5.3: The black listing of firms should be done, when there is no other option available. The process
be initiated after due consideration of as it may impact on the supply of other divisions/departments.

6. General Procedures and Rules for Purchases:


The following procedures shall apply to all purchases except where stated otherwise.
6.1. Purchase of Goods without Quotations:
6.1.1. Purchase of goods up to a value of Rs.50,000/- (Rs Fifty Thousand only) on each
occasion may be made without inviting quotations/bids by the Competent Financial
Authority only on the basis of a certificate recorded by him/her in the following
format:
I am personally satisfied that these goods purchased are of the requisite quality and
specification and have been purchased from a reliable supplier at a reasonable price.
Signature

All Purchases as in the serial number 6.1.1 can be made directly by the purchaser from the
market/authorized dealers including telephonic enquiries (after ensuring that the price is
reasonable) or through Central Purchase Section. Such purchases shall be done in the
following three ways:
(a) Directly by the purchaser through an advance drawn for the purpose. This
advance shall be subsequently adjusted, for which cash memo/bill/receipt and
proof of entry in the appropriate Stock and Asset in addition to e-data entry (if
relevant) Register must be submitted. Approved formats shall be used for
drawing the advance and for adjustment. The form for advance shall be sent to
the Accounts Section. Intimation must be sent to Central Purchase Section in
case of NCS and LTAS purchases for entering the item in Asset register in
addition to e-data entry, otherwise bills for payment will not be passed by
Accounts Section and shall be monitored by Internal Audit.
(b) By the purchaser making the purchase directly from the seller and the payment
being made by the Accounts Section. Payment will be made against proper
invoice/bill/tax invoice proof of challan/transfer invoice of the item by the
purchaser and entry in the appropriate stock register and Asset Register in
addition to e-data entry (wherever relevant). Intimation must be sent to Central
Purchase Section in case of NCS and LTAS purchases entering the item in Asset
register in addition to e-data entry, otherwise bills for payment will not be passed
by Accounts Section and shall be monitored by Internal Audit.
(c) Through Central Purchase Section, for which the minimum three quotation duly
signed together with the Purchase Proposal Form Annexure-I approved by the
Competent Financial Authority shall be sent to Central Purchase Section for
placing the order and further processing.

Comment to Article 6.1.1: The competent financial authority must ensure that direct purchase under this article is made
only in essential conditions and/or when due to time constraint it is not possible to invite quotations/bids. The purchase
may be made from firms not registered with SRM system; however the onus will be on the purchaser to certify the
specification, reliability and price of purchased item(s).
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6.2.Purchase of goods by Purchase Committee


Purchase of goods costing more than Rs.50,000/- (Rs. Fifty Thousand only) and up to
Rs.1,50,000/- (Rs One Lakh Fifty Thousand only) on each occasion may be made on the
recommendations of a duly constituted Local Purchase Committee consisting of at least
three members of an appropriate level as decided by the Competent Financial Authority.
The committee will survey the market to ascertain the reasonableness of rate, quality and
specifications and identify the appropriate supplier. Based on the recommendations of the
Local Purchase Committee, the purchase order will be released by the Central Purchase
Section. Before recommending placement of the purchase order the members of the
committee will jointly record a mandatory certificate as under:
Certified that we members of the purchase committee are jointly and individually satisfied
that the goods recommended for purchase are of the requisite specification and quality,
priced at the prevailing market rate and the supplier recommended is reliable and
competent to supply the goods in question.

Signature

6.3.Purchase of goods in Emergency Situations


In the company business there may be unfavorable, disastrous, tragic, critical and urgent
situations, wherein it may not be possible to take prior financial approvals to procure the goods
or services. In such situations the purchaser may purchase the goods, irrespective of the
expenditure amount from a reliable firm, to run the company business in an efficient and
proficient manner. The purchaser should be cautious to use the provisions of this Article only in
emergency and exceptional situations; and this Article should not be used in normal
circumstances. The Purchaser must adhere to the following rules and regulations:
i.
ii.
iii.

The Purchaser will endorse logical reasons to claim that the purchase was made in
emergency situations.
The Purchaser will endorse justification that there was no other alternative available
than to make the purchase in emergency situation.
The Purchaser in such situation will submit a certificate recorded by him in the
following format:

I am personally satisfied that these goods purchased are of the requisite quality and
specification and have been purchased from a reliable supplier at a reasonable price. The
purchase was made in emergency situations otherwise it could be detrimental to the
Company business.
Signature

Comment to Article 6.2: The competent financial authority must ensure that the purchase should be made only in
essential conditions and/or when there is time constraint to invite quotations/bids. The purchase should be made by a
duly constituted committee who shall survey the local market and will collect the quotes from reliable firms/vendors for
recommendation to the Central Purchase Section.
10

iv.

The Purchaser will take post-facto approval from the Competent Financial Authority
and certification that the competent financial authority is fully satisfied with the
emergency purchase and purchase is justified.

v.

The Purchaser after post-facto approval from the Competent Financial Authority will
submit the complete record to the Central Purchase Section.

vi.

The CEO/FA Head of Central Purchase Section after the receipt of complete record
submitted by the purchasers, will submit the monthly report of emergency purchases
made by divisions/departments to the M.D./J.M.D. for information.

6.4.Purchase of Goods with Quotation:


6.4.1. Purchases up to a value of Rs.1,50,000/- (Rs. One Lac Fifty Thousand) with a
minimum three quotations from the registered firms, can be made by a committee
approved by the Competent Financial Authority. Quotations will be invited as per the
procedure at Article 6.13. Quotations should be opened and signed by at least two
persons of the Committee and the Competent Financial Authority. The Committee
will prepare the comparative statement and forward its recommendation to Central
Purchase Section for selected firm with the approval of Competent Financial
Authority for placing purchase order.

6.4.2. For purchases more than Rs.1,50,000/- (Rs. One Lac Fifty Thousand), purchase will
be done through a Purchase Committee of at least three members nominated by
the Competent Financial Authority and approved by the M.D./J.M.D, including one
representative of Central Purchase Section/Accounts Division to ensure the adoption
of correct procedure. The divisions/departments may also get a committee
nominated by the Competent Financial Authority and approved by the M.D./J.M.D.
for a maximum period of one year to make such purchases. Quotations will be
invited from the registered firms as per the procedure at Article 6.13. Quotations
received should be opened and signed by at least two persons of the Purchase
Committee and the Competent Financial Authority.
6.4.3. Irrespective of the amount, for purchases which are directly initiated by the Central
Purchase Section, the CEO/FA Head Central Purchase Section shall constitute a
committee duly approved by the M.D./J.M.D. for a period of one year comprising of
at least four members including one from the Central Purchase Section and one
from the Accounts/Finance Section. This procedure is to be followed when bulk
purchase of stores is involved (e.g. medicines, stationery items, chemicals & liveries etc) or
items which are required by multiple departments.
Comment to Article 6.3: The purchase under this Article is strictly limited to emergencies. The competent financial
authority before approval of purchase must ensure that the purchase was warranted to avoid the business crisis. The
onus will be on the purchaser to certify the specification, reliability and price of the purchased item(s).

11

6.4.4. For goods of estimated value Rs. 10,00,000/- (Rs. Ten Lac) and above the
procurement will be by open tender by advertisement. The advertised tender enquiry
should be on the official website of TCI Group and permit prospective bidders to
make use of the document download from the website. However, the purchase
through Limited Tender Enquiry may be adopted even where the estimated value of
the procurement is more than Rs. 10,00,000/- (Rs. Ten Lac) in the following
circumstances:
i.
The demand is urgent and the limited tender enquiry is justified.
ii.
It will not be in Company interest to procure the goods through advertised
enquiry.
iii.
The sources of supply are definitely known and possibility of fresh
source(s) beyond those being taped is remote.
iv.
Sufficient time has been allowed for submission of bids in limited Tender
enquiry.

6.5.Purchase of goods on single quotation basis (Proprietary Article)


Procurement of goods on single quotation basis may be followed in the following
circumstances.
It is in the knowledge of the user division/department that only a particular firm is the
manufacturer of the required goods or proprietary item.
In case of emergency, the required goods are necessarily to be purchased from a
particular source and reason for such decisions is to be recorded and prior approval
of the competent financial authority be obtained before effecting the purchase.
For standardization of machinery or spare parts to be compatible with the existing
sets of equipment, the required item is to be purchased only from a selected firm.
The indenter should provide a certificate that the price quoted by the firm is
reasonable and the same is a proprietary item .
Purchase of items of a proprietary nature (i.e. item which do not have substitutes, or are spare parts of already
existing equipment for which substitute replacements are not available or advisable) can be done on the basis of
a single quotation. In such cases the purchaser must furnish a proprietary certificate (as placed at
Annexure-V) countersigned by the CEO/FA Head/HOD of the concerned division/department. If
the total value of the item is more than Rs. 1,00,000/- (Rs. One Lac) a proprietary certificate must
be obtained from the supplier/manufacturer stating that they are the only source of
supply/manufacturing. The purchaser will forward all documents, quotation, recommendation and
approval to Central Purchase Section for placing purchase order.

Comment to Article 6.4.4: Limited tender enquiry should be floated to only those firms who have rich experience and
reputed credentials in the corporate sector.
Comment to Article 6.5: Proprietary certificate from the purchaser or the manufacturer, as appropriate, is essential to be
obtained to maintain authenticity, credibility and trustworthiness of purchase from a single firm.

12

6.6.Repeat Orders
Repeat orders are processed subject to the following conditions: the repeat order can be made without enhancing the rates, specifications as well as terms &
conditions of supply.
the repeat order shall be placed within one year time from the date of the contract.
no repeat order will be placed if buyback is involved in the purchase.
Any amended order shall not be considered for repeat order.

6.7.Purchase of Rate Contract Goods


A Rate Contract is an agreement between the purchaser and the suppliers for supply of specific
goods and allied services, if any, at specified price and terms and conditions during the period
covered by the Rate Contract.
Based on requirements identified by the Central Purchase Section the Company may enter into
rate contract arrangements for specified terms from one or more sellers for a specified length of
time. The details of such arrangements shall be negotiated by a committee constituted by the
CEO/FA Head Central Purchase Section. The recommendations of the committee shall be
approved by the CEO/FA Head Central Purchase Section before they are formally adopted.
The period for which the Rate contract is valid will be counted from the day the rate contract is
formally adopted. The process for entering into rate contract arrangements shall be initiated by
the Central Purchase Section.

6.8.E-Procurement & Reverse Auction


E-Procurement i.e. Purchase of goods through electronic mode of interface with tenderers and
IT enabled management of the entire procurement process (notice inviting tenders, supply of
tender documents, receipt of bids, evaluation of bids, award of contract, and execution of
contract through systematic enforcement of its various articles, clauses and tracking claims,
counter-claims and payments) is permitted by TCIL Group.
The system will be secure, capable of maintaining complete confidentiality at appropriate
stages of the bidding process, so that the tenderers feel confidence in electronically
transmitting their queries and bids.
The quotations may be received by email/fax, provided the quotations received via e-mail/fax
duly completed in all respects is received from the concerned tenderer before the end date of
submission of quotations.
Reverse Auction purchases where possible, may also be conducted by the Central Purchase
Section.
The TCI Group may setup its own E-Procurement & Reverse Auction system or use the
services of third party, duly accredited and certified by the agencies as per prevailing rules and
regulations.
Comment to Article 6.8: The e-procurement and reverse auction modules developed by TCI IT Division or third
party services should be used only after due corroboration of their security, reliability and conformity with prevailing
rules and regulations.
13

6.9.Purchase under buy back scheme


If any item is purchased under buy back scheme for old one, quotations are to be invited clearly
mentioning the specification of old and new item asking the buyback offer from the vendor.
After finalizing the deal a condemnation report is to be filled for old item, signed by all members
of condemnation/write-off committee, constituted by the CEO/FA Head/HOD of the concerned
division/department. The condemnation/write-off report should be approved by the competent
financial authority, and finally to be sent along with purchase indent to the Central Purchase
Section for further action. It is to be mentioned on condemnation report that item is being given
to the firm under buyback scheme.

6.10.

Two bid system

Purchasing of capital equipment, high value plant, machinery etc. of complex and technical
nature, the tender enquiry document complete in all respects will be issued as usual by the
Division/Department/Central Purchase Section. However, the tenderers should be asked to
divide their quotation in two parts. The first part is to contain the relevant technical
specifications and allied commercial details as required in terms of the tender enquiry
documents and the second part should contain only the price quotation. The first part is
commonly known as a Technical Bid and the second part Financial Bid.
The technical bid and the financial bid should be distinguished by the tenderer. The technical
bids are to be opened in the first instance, at the prescribed time and date and the same will be
scrutinized and evaluated by the competent committee with reference to the parameters
prescribed in the tender documents and the offer received from the tenderers.
Thereafter, in the second stage, the financial bids of only the technically acceptable offers (as
decided in the first stage above) are to be opened for further scrutiny, evaluations, ranking and
placement of contract.

6.11.

Late Tender

In the case of advertised tender enquiry, or limited tender enquiry, late tenders (i.e. tenders
received after the specified date and time for receipt of tenders) should not be considered.

6.12.

Purchase procedure for the items not covered under Article 6.1.1

In case of direct purchase by Central Purchase Section, the quotation shall be invited by the
Central Purchase Section as per the prescribed procedure, however as a special case
purchaser can call quotations but the rules should be followed and proper justifications be given
for inviting quotations. Indenter will send approved indent with detailed specifications for inviting
quotations to the Central Purchase Section. The Central Purchase Section after inviting
quotations and making comparative reports will send to concerned indenters for making
recommendations for placing order. The purchase shall be processed based on at least three
quotations from registered firms unless an exemption to this effect has been explicitly obtained
from the CEO/FA Head Central Purchase Section. It is not correct that enquiry be sent to three
firms and get three quotations only. Enquiry should be floated to as many firms as possible to
have competitive rates.
Comment to Article 6.10: Two bids purchase should be adopted for complex and high value technical purchases. In
such type of purchase the technical evaluation is of paramount importance than financial.
14

6.13.

Invitation of Quotation/Bid/Tender Procedure

Quotation/Bid/Tender can be called and received by registered post/speed post/courier


service in sealed cover or via secured e-procurement method including fax and e-mail. The
rates should preferably be quoted both in words and figures. All cuttings, overwriting should
be duly initialed, failing which the quotation/tender/bid may be liable to be rejected.
The enquiry sent by the Division/Department/Central Purchase Section to the firms should
have all details especially on the following points:
i.
The text of bidding documents should be self contained and comprehensive without
any ambiguity of essential information, which a bidder needs for sending responsive
bid, should be clearly mentioned in the bidding document in a simple language. The
bidding document should contain inter alia:
a) the specification of the item(s) and end use of the required goods,
b) quantity to be purchased,
c) the date and time by which the quotation should be received,
d) the date by which deliveries are expected,
e) the date on which the quotation will be opened (wherever necessary),
f) warranty requirements,
g) requirement of test certificate, if any,
h) requirement of type approval for compliance of statutory requirements
with respect to pollution, emission, noise, etc.
i) training, technical support, after sales service and annual maintenance
contract requirements, if any.
j) period of validity of quotation,
k) special requirements of packing and marking, if any,
l) normal payment terms of the Company,
m) tax exemptions applicable and
n) any other special terms and condition which are applicable.
o) The criteria for eligibility and qualification to be made by the bidders such
as minimum level of experience, past performance, technical capability,
manufacturing facilities and finance position etc.
p) Eligibility criteria for goods indicating any legal rectification or conditions
about origin of goods etc., which may be required to be made by the
successive bidder.
ii.
The bidder should be given reasonable time to send their quotations.
iii.
After opening of the bids, where price negotiation becomes essential it should be
resorted to with the lowest evaluated technically suitable bidder.
iv.
The purchase order ordinarily be placed to the lowest evaluated bidder whose
quotation has been found to be responsive and technically suitable and qualified to
ensure the supply as per the terms and conditions incorporated in the bidding
documents.

Comment to Article 6.13: Comprehensive, item specific technical terms and conditions should be incorporated in the
invitation to quotation/bid/tender. The user division/department must be consulted and the draft invitation should be
approved by the user division/department.
15

6.14.

In the rate contract system where numbers of firms are brought on rate contract for
the same item, negotiations as well as counter offer of rates are permitted with the
bidder in view. Quotation must be opened in the presence of all purchase committee
members/purchaser as the case may be. All quotations must be signed by all
members of the committee/purchaser (along with date). Signatures are necessary on
the covering envelope, if received by post, financial part of the bid and the part which
contains the terms and conditions.

6.15.

In all purchases with multiple quotations, the report of the purchaser/purchase


committee should include the following:-

a) A comparative statement of all dealers/sellers indicating all taxes, freight,


forwarding etc (i.e. the total cost of the purchase).

b) The dealers from whom purchases is recommended.


c) In the event purchase is recommended not on the basis of lowest quotation,
the reason thereof shall be explicitly stated.

d) Any other relevant information, the report complete in all respects along with
associated documents shall be sent to the Central Purchase Section for
further action and placing the purchase order.

6.16.

Before initiating the purchase process it is mandatory to pre examine the allocated
budget, available funds and funds availability after purchase. Accordingly all entries
should be updated in the system.

7. Payment Terms:
7.1. Except for purchases under serial no 6.1.1, the payment terms shall be as approved by the
Competent Financial Authority in the approval sheet or as per the terms of the contract.
The terms of payments may be changed from item to item.
7.2. Payment terms against dispatch documents through bank may not be allowed as far as
possible keeping in view the risk involved.
7.3. If the payment term is against delivery/COD (cash on delivery) then after receiving the
goods indenter shall inform the Central Purchase Section to release the payment after
being satisfied.

Comment to Article 7.1: The purchase payments should be only in accordance with the approval of the competent
financial authority and the terms of the contract. Change of mode of payment from the approved mode of payment
can only be made by the approval of the competent financial authority, endorsing the reason(s) for such change.
16

7.4. For balance payment, after receipt of satisfactory Inspection Report (IR) the items must be
entered in appropriate stock and asset register. The Central Purchase Section will submit
the necessary document as soon as possible but no later than fifteen days to Account
Section for release of payment. The Accounts Section will ensure that the payment due are
released through cheque/draft directly to the seller by registered post/courier.
7.5. When cheques are sent to sellers directly by Account Section for the balance and final
payment a copy of covering letter must be sent to Central Purchase Section for information
and closing the file.

8. Liquidated Damages (Late Delivery)


There may be a suitable provision in the terms & conditions of the contract for claiming liquidated
damages of appropriate amount from the supplier to take care of delays in supplies and
performance, for which the supplier is responsible. Such recovery through liquidated damages may
be without prejudice to the other remedies to the purchaser under the terms of the contract.
As per the terms of the contract the payment should be made after deduction of penalty amount or
a cheque of penalty amount must be taken from the seller in favor of the concerned TCI Group
division/department.

9. Purchase Approval and Receipt of Items:


The approval sheet for all purchases except Article 6.1.1 must be approved by the Competent
Financial Authority. These approval sheets will be prepared by the concerned
divisions/departments in case of direct invitation of quotations/bids. The Central Purchase Section
will prepare approval sheets in those cases where the complete process is handled by the Central
Purchase Section.
9.1. If for any reason a financial enhancement in the purchase order is required, the request for
such a change will be approved by the Competent Financial Authority before the change is
issued in the form of an amendment to the original purchase order by the Central Purchase
Section.
9.2. All purchases, exception to Article 6.1.1, shall be made through a purchase order placed
on the seller by the Central Purchase Section, who shall be responsible for receipt of
goods and the subsequent dispatch of the receipted goods to the purchaser along with
copies of Inspection Report. The purchaser shall return the Inspection Reports as soon as
possible but no later than fifteen (15) days of receipt of items and after recording
appropriate comments.
Wherever the purchase has been processed through a purchase committee, the purchaser
shall ensure that the committee has carried out the inspection of the items prior to
submission of the Inspection Reports to the Central Purchase Section.
Comment to Article 9.2: Inspection of the items purchased is mandatory before the payment to the firm. The
purchaser/purchase committee must inspect the items to ascertain its specifications in compliance with the terms and
conditions as laid down in the invitation of enquiry or purchase order placed. Any deviation from the invitation of
enquiry/purchase order should be brought to the knowledge of Central Purchase Section within stipulated time period
for further action.
17

9.3. Inspection Reports must be returned to the Central Purchase Section duly approved or
rejected as soon as possible but no later than fifteen (15) days of receipt of items,
otherwise it will be presumed that materials supplied are acceptable to the purchaser and
necessary action will be taken for making the payment to the firm.
9.4. The Central Purchase Section shall be responsible for clearance of all consignments at
railway stations, sea, airport, and transport godowns and safe transportation and storage.
Insurance of items shall be done before dispatch, as per the terms of the contract, if
required.
9.5. Normally delivery of items purchased shall be done at the Central Purchase Section.
However, on the specific directions of the Central Purchase Section duly approved by the
CEO/FA Head Central Purchase Section, the suppliers may also deliver the items directly
to the purchaser in which case the purchaser shall be responsible to inform the Central
Purchase Section about such delivery as soon as possible but no later than fifteen days
(15) of receipt of the items.
9.6. In the event of any shortage/damage/wrong supply, prompt action will be initiated by the
Central Purchase Section to rectify the same. In case the supplier fails to rectify the
shortage/damage/wrong supply in a reasonable time, the matter shall be referred to the
legal cell to recover the full cost paid. The Central Purchase Section shall lodge Insurance
claims, and pursue them vigorously to realize the sum insured.
9.7. Once the purchase has materialized satisfactorily, the items must be entered in the
appropriate stock register and in the Asset Register of the Company manually as well as
electronically, where ever relevant.
9.8. The payment order, signing of bills, signing of cheques for the processing of payments and
adjustment shall be in accordance with the delegation of powers as per company rules.
9.9. Any increase in the price of item(s) ordered which is directly and entirely attributable to
fresh imposition or increase in Government levies and taxes may be allowed subject to
furnishing of sufficient valid written proof by the supplier.
9.10. The M.D./J.M.D. may at his discretion permit deviations in writing from any of the above
provision if he is satisfied that such deviations will be in the interest of the Company and
that the insistence on the above provisions can cause inconvenience and delay.

Comment to Article 9.9: There may be deviations, increase or decrease, in government taxes/levies between dates of
approval on the basis of quotation/bid/tender and actual purchase. If there is incremental deviation, the payment to the
firm should be made on the production of government notification.
Comment to Article 9.10: The M.D./J.M.D. has definite authority to relax in any of the norms; however this authorization
should be documented as part of the purchase documents.
18

10.

Duties & Taxes:

The Company may be required to pay freight/insurance charges as per terms of the contract. Any
concession on taxes and levies such as excise duty, custom duty and sales tax etc. to be granted
by the state/central Government in procurement of any item must be availed. The Central
Purchase Section shall obtain all such information and apprise all concerned about the applicability
of tax/levy rates and charges brought about, if any, from time to time. The Central Purchase
Section shall issue the required declaration/certificate to this effect for all purchases on demand
and account for all such issues.

11.

Annual Maintenance Contract:

Depending on cost and nature of the goods to be purchased, it may also be necessary to enter into
maintenance contracts for a suitable period either with the supplier of the goods or with any other
competent firm, not necessarily the supplier of the subject goods. Such maintenance contracts are
specially needed for sophisticated and costly equipment and machinery. It may however be kept in
mind that the equipment or machinery is maintained free of charge by the supplier during its
warranty period or such other extended periods as the terms of contract may provide. The paid
maintenance should commence only there afterwards.
The
annual
maintenance
contract,
repair
contract,
repair
work
from
the
manufacturer/manufacturers authorized supplier, in respect of various equipment, may be entered
into by the Central Purchase Section on the recommendation of concerned division/department. In
all cases, quotations will be invited and normal purchase rules shall be adhered. In case of renewal
of the Annual Maintenance Contract, the following points may be taken care of while sending the
proposal for renewal of Annual Maintenance Contract.
Annual Maintenance Contract should be from a prospective date. In order to ensure this,
the concerned division/department shall be required to initiate action for renewal of Annual
Maintenance Contract at least 60 days before the expiry of previous Annual Maintenance
Contract.
In case of renewal, the service report/log book should be sent along with the proposal to the
Central Purchase Section.
In case of any increase in the Annual Maintenance Contract cost when compared to
previous Annual Maintenance Contract, necessary justification for increase in price may be
obtained from the firm and enclosed along with the indent for submission to the Central
Purchase Section.

12.

Purchasing of Import Items:

Generally the purchase procedure outlined in this manual shall be followed for procurement of
items through import. However, the following is especially applicable to imports made by the
Central Purchase Section.
12.1. Any category of stores can be purchased from foreign suppliers subject to restrictions on
imports as imposed by the government from time to time.

Comment to Article 11: Though it is not mandatory to award annual maintenance contract to the supplier of the goods,
but for certain equipment/items, technically it may be necessary/compulsory to award the contract only to authorized
manufacturer/dealer. In such cases the price negotiations can be done by the Central Purchase Section.
19

12.2. Provision of exemption in customs duty must be availed, if applicable.


12.3. Import should normally be made directly from the foreign principal manufacturers. In the
event a purchase is made through a local agent of the foreign company, proof that the
local agent is an authorized agent of the foreign company must be obtained and must be
part of the documents pertaining to the purchase. Any commission of the agency which
may be payable to the local agent can be paid only in local currency (unless there is a
change in Government rules which may necessitate payment in foreign currency).
12.4. If a foreign company has opened an office locally then it can appoint designated
personnel to deal with TCI Group or its subsidiaries.
12.5. All imports shall be done through the Central Purchase Section. The Central Purchase
Section shall ensure that the item being imported does not fall under the
restricted/negative/banned category.
12.6. Request for quotation for items to be procured through import may be sent through
registered post/speed post/courier/e-mode including e-mail and fax.
12.7. Payment for import shall normally be made through a letter of credit. However, payment
can also be made by a draft, subject to the restrictions placed by the government.
12.8. Advance payment by a foreign currency draft/TT can be made but in conformity to the
government regulations. For such payments, the advance payment will be treated as an
advance against the purchase until it is adjusted.
12.9. Term of shipment should be on CIF basis, delivery up to destination/place.
12.10. The Central Purchase Section will be responsible for placing orders, opening/amending
extending letters of credit, insurance, clearance and transportation of goods, processing
for short shipped/damaged goods.
12.11. Wherever required, the Company shall avail the services of clearing/consolidation
agents for foreign consignments arriving by air/sea. Such clearing agents shall be hired
on the basis of agreed terms or single consignment basis; whichever may be
advantageous to the Company, by the Central Purchase Section.
12.12. The Central Purchase Section shall maintain a import stock register separately in which
all imported items received shall be entered. Delivery of foreign consignment to the
purchaser will be made against the signature in this register. All imported items shall be
appropriately entered in the stock register and asset register in addition to e-data entry,
if applicable.
Comment to Article 12.1: The purchaser should ensure that item to be imported should not be a restricted item
declared by customs department and/or government. The Central Purchase Section should ensure that they are in
possession of updated list of restricted items issued by customs department and/or government from time to time.

20

12.13. Duly approved or rejected Inspection Reports must be returned to Central Purchase
Section by the Purchaser, as soon as possible but no later than ten (10) days of receipt
of items, failing which it will not be possible to lodge the claim of damage to the
Insurance Company and it will be presumed that materials supplied are acceptable to
the Purchaser.

13.0 Import of items through individual International Credit Card:


13.1 The purchaser must take the approval from the Competent Financial Authority in
advance. The purchase through individual credit card must be limited to the amount
as per the directives of government.

13.2 Indenter must ensure through Central Purchase Section if the item is not
banned/canalized.

13.3 Indenter should also declare that the item is not for sale, or profit, making it clear that
it is exclusively for Company use.

13.4 Indenter should get approval of Competent Financial Authority before placing the
order by credit card and inform the Central Purchase Section for recording the
amount for onward submission to the concerned department(s) for the registration of
exemption of customs duty, if available.

13.5 Shipping mode and port of shipment must be clear in the order as to whether the
shipment will be FOB/C&F/CIF/FAS etc.

13.6 Shipping details should be intimated by the indenter to the Central Purchase Section
before it is dispatched.
13.7

Each and every event development must be intimated to the Central Purchase
Section to avoid delay in release leading to demurrages for the material.

14.0 Maintenance of Record


This section describes the records pertaining to stores that must be maintained by the Companys
divisions, departments, sections & units so as to facilitate proper stock verification, write-off and
revaluation of stores, besides the transfer of stores from one division/department to another. All
stores records will be e-data based in three categories NCS, LTAS and CS. The corresponding
physical registers are mandatory to be maintained, updated and duly signed regularly by the
CEO/FA Head of Central Purchase Section, Divisions, and Departments for physical verification of
records by the Internal Audit, and to secure the records in case of loss of e-data due to
unavoidable circumstances/situations.
Comment to Article 13: The purchase through individual international credit card should be made on the explicated
approval of the competent financial authority. The individual credit card should be used only in exceptional
circumstances e.g. when the purchase can be made online only or it becomes essential to do the purchase in foreign
currency or country. However, in any case the economic rules enacted by the government should be followed.

21

The CEO/FA Head/HOD of the division/department should ensure that all record entries, including
but not limited to purchase, write off, auction, both e-data and manual, must be in compliance with
Articles 14.1, 14.2, 14.3 and 14.4.
14.1

The Company shall maintain a record of all purchases in the NCS category in the
Asset Register and e-data of the Company. Each entry must contain at least the
following information:
14.1.1 purchase order number and date,
14.1.2 brief specification of the item,
14.1.3 date of entry in the Asset Register,
14.1.4 name of the department, and
14.1.5 cost.

The total value of all the assets entered in the Asset Register and the e-data during the financial
year shall indicate the value of the assets to be capitalized in the balance sheet of the
corresponding financial year.
14.2

The Company shall maintain a record of all purchases in the LTAS category in the
Limited Time Asset Store Register and e-data of the Company. Each entry must
contain at least the following information;
14.2.1 purchase order number and date,
14.2.2 brief specification of the item,
14.2.3 date of entry in the Asset Register,
14.2.4 cost.

The total value of all the assets entered in the LTAS register and the e-data during the financial
year shall indicate the value of the limited time assets to be capitalized in the balance sheet of the
corresponding financial year.
14.3

The Central Purchase Section and each division/department shall maintain the
following three separate registers NCS Stock Register, LTAS Stock Register and
Consumables Stock Register. Items in the different categories purchased by the
divisions/departments and Central Purchase Section shall be entered in the
appropriate register in addition to e-data entry.

14.4

The register should have following certificate on the first page ;

Certified that this register contains a total of ------------- pages and each page has been
consecutively numbered on both sides from ----to----.

Date:

Signature of the Officer-in-Charge


Central Purchase Section/Division/Department

Comment to Article 14: Purchased item should be entered in the records both in registers and e-data. The record
should mention asset value in addition to other details of the item purchased e.g. items description, total quantity after
purchase, bill number, purchase date etc. The records should be maintained properly and duly signed by the
appropriate authorities. In all cases Central Purchase Section will be the custodian of purchase documents.
22

14.5

The Central Purchase Section shall be the custodian of all stores, purchase records
pertaining to NCS, LTAS, CS and Import items of the Company. All original
documents related to any such purchase (including but not limited to inquiries, report
of purchase committee, approval sheet, purchase order, invoice/bill, delivery challan,
and inspection reports etc) shall remain with Central Purchase Section after
purchase is complete.

15.0 Stores Audit


This section describes the records pertaining to stores that must be maintained by the Company.
The annual audit of all stores (NCS, LTAS, CS) will be conducted by Internal Audit at the end of
the financial year. It will be the responsibility of the CEO/FA Head/HOD of the concerned
Division/Department to make available all stores records, both e-data and registers, to the Internal
Auditors. The Internal Audit Report will be signed jointly by the Internal Auditor and CEO/FA
Head/HOD of the concerned division/department. The Internal Auditor will submit its report to the
CEO/FA Head Central Purchase Section and a copy to the CEO/FA Head/HOD of the concerned
Division/Department. The CEO/FA Head Central Purchase Section at the end of Internal Audit will
forward duly signed copies of the Internal Audit Reports of all divisions/departments to the
M.D./J.M.D.

16.0 Transfer of Stores


16.1

Transfer of stores within the Company from one division/department to another can
be done by using the approved format. Transfer of items whose individual value is
greater than 10,00,000/-, the explicit written approval of the M.D./J.M.D. will be
mandatory. The transfer must be duly recorded in the relevant register of both the
divisions/departments. For transfer of item of any value the permission of CEO/FA
Head/HOD of the concerned divisions/departments is essential.

16.2 Subsequent to transfer of stores as mentioned above, the appropriate Stock and
Asset Registers both manually and e-data shall be suitably updated. The value of
stores so transferred shall be deducted from the capitalized assets of the Company
as indicated in the balance sheet.

17.0 Write off, Condemnation and Disposal


17.1 An item may be declared surplus or obsolete or unserviceable, if the same is of no
use to the Company or when the item is beyond economical repair. An item may be
rendered surplus, obsolete or unserviceable in the process of upgrading or replacing
Company property or when Company property or equipment no longer serves a
functional use due to programme, procedure or other changes. Under such
circumstances the property and equipment be disposed of in the best interest of the
Company as per the following guidelines: with prior approval of the Competent
Financial Authority.
Comment to Article 15: The audit of all stores maintained by the Central Purchase Section, divisions, departments,
units, sections will be conducted by the internal audit of TCI Group at the end of the financial year.
23

17.1.1 Wherever possible, the stores/equipment is traded under buy back scheme,
so as to reduce the cost impact on the new stores/equipment.

17.1.2 If the above option is not available, the property and equipment be sold out
rightly with due procedures written in this Purchase Manual.

17.1.3 Obsolete, unusable materials beyond economic repair be disposed off as per
procedure written in this Purchase Manual.

17.2 General Procedure for writing off the unserviceable Materials/Items.


17.2.1 Every year in January the CEO/FA Head/HOD of the division/department
shall constitute a committee of not less than three members. This committee
shall survey all the NCS and LTAS stores and recommend write-off for NCS
items which are not useable and not serviceable and revaluation for LTAS
items which have become obsolete. For NCS the committee shall record the
reason for recommending write-off. For LTAS the committee shall revalue the
LTAS and report all those items which may be considered to be as of no
value with reasons recorded. The CEO/FA Head/HOD of the concerned
division/department shall forward the report to CEO/FA Head Central
Purchase Section for approval by the M.D./J.M.D.
17.2.2 The items to be declared obsolete/surplus/unserviceable should be examined
by a committee at appropriate level to be appointed by the CEO/FA
Head/HOD of the concerned division/department to declare an item of stores
as obsolete, surplus or unserviceable and order their disposal. The committee
should take into account the prescribed or stipulated life period of the stores.
In case, such period is not prescribed/stipulated or it is not over, the
committee should examine the conditions of stores and record suitable
reasons. If an item has become obsolete/surplus/unserviceable on account of
negligence, fraud or mischief on the part of employee, the same should be
brought out clearly.
17.2.3 Where the life period has been prescribed on any item and the same is
already over, it should normally be taken as enough ground for declaring the
item obsolete and unserviceable. However, the condition of the item should
still be thoroughly examined to see whether the item could be put to further
use.
17.2.4 In other cases, where the life period is not over or no life period has been
prescribed or stipulated, the reason for declaring the item unserviceable
should be clearly recorded such as may be normal wear and tear, excessive
use, accidental fire, flood and other natural causes, damage due to insect,
rats etc.
Comment to Article 17.2: In case of losses due to negligence, fraud or mischief on the part of employee(s), the
accountability should be fixed by the CEO/FA Head/HOD of the concerned division/department, and the losses made
good.
24

17.2.5 An item may be declared obsolete/surplus if it is no longer required by the


Company. Reasons for the same should be recorded.
17.2.6 In case of loss due to negligence fraud or mischief on the part of any
employee responsibility should be fixed and losses made good.
17.2.7 The condemnation Committee shall endorse its recommendations in the
Condemnation Report and submit to the CEO/FA Head/HOD of the
concerned
division/department.
The
condemnation
report
with
recommendation of CEO/FA Head/HOD of the concerned division/department
will be submitted to the CEO/FA Head Central Purchase Section for approval
by the M.D./J.M.D.
17.2.8 Label the items/materials for write off.

17.3 The write- off/condemnation Committee Composition:


The committee composition will be decided by the CEO/FA Head/HOD of the
concerned division/department.

17.4 Procedure for Auction


17.4.1 After approval of the M.D./J.M.D on the recommendations of Condemnation
Committee & CEO/FA Head/HOD of the concerned department, the CEO/FA
Head/HOD shall forward a copy of the approval to the Central Purchase
Section.
17.4.2 The Central Purchase Section shall make arrangement to remove the
condemned articles/materials to the place earmarked for their temporary
storage, within a week from the date of receipt of the copy of the
condemnation report. Items to be disposed of shall be under the custody of
the Central Purchase Section until their disposal.
17.4.3 The Central Purchase Section as per the value of item(s) shall decide the
mode of auction. As far as possible, the disposal should be through tender
notice or through open auction.
17.4.4 After depositing the full auction amount the party should lift the goods within a
period of seven days. If the goods are not removed within the specified
period, the party shall have no right or claim to the goods and whatever
money has been deposited shall be deemed to have been forfeited. The
Company shall be free to dispose of the goods in any manner as it may deem
fit.
Comment to Article 17.3: The condemnation committee should be composed of at least one technical personnel for
ideal evaluation of store items.
Comment to Article 17.4: The auction of condemned articles/materials shall be conducted by the Central Purchase
Section in accordance with the rules and regulations enacted in the purchase manual.

25

17.4.5 The Company shall reserve the right to reject all or any tender or auction
without assigning any reason.
17.4.6 On receipt of the sale account the auctioned items will be write off from the
stock/Asset Register.
17.4.7 It is generally observed that very negligible value is quoted for items like
Computers, Printers, Typewriters and Furniture etc. It will be, therefore,
appropriate, if the preference is given to Company employees while selling off
the above items after taking approval from the M.D./J.M.D.
18.0

Until the Central Purchase Section is fully e-data enabled and online, the purchases may be
made by the divisions/departments through Central Purchase Section via email or other
options available with them. But it is mandatory that Central Purchase Section should be in
possession of original documents pertaining to such purchases made directly by the
divisions/departments or through Central Purchase Section.

19.0

Cases not covered by this purchase manual will be decided by the M.D./J.M.D. in the
interest of Company.

20.0

The M.D./J.M.D. may at his discretion permit deviations from any of the above provision if
he is satisfied that such deviations will be in the interest of the Company.

26

21.0 CONFLICT OF INTEREST


21.1 Policy
An employee is in a conflict of interest situation when he/she has an interest or a
potential interest of any kind in a contract, agreement or financial relationship in which
the Company has an interest or potential interest. In relationships with vendors, a
conflict can be created by non-monetary interests such as gifts and business courtesies,
so the giving and receiving of gifts/courtesies are subject to the guidelines below.
Employees are expected to be free of interests or relationships that are actually or
potentially detrimental to the company. They shall not engage or participate in any
commercial transaction involving the company in which they have an undisclosed
interest. In addition to being in violation of the employees duty of loyalty to TCI Group,
improper relationships with vendors are at odds with the companys goal of treating fairly
and impartially all persons and entities engaged in business dealings with TCI Group.

21.2 Practice
Any employee who has assumed, or is about to assume, a financial or other outside
business relationship that might involve a conflict of interest immediately must inform
his/her supervisor in writing of the circumstances involved. This information is to be
forwarded to and reviewed by senior management, for a decision on whether a conflict of
interest is present and, if so, what course of action is to be taken.
The company does not seek to gain or provide any improper advantage it is imperative
that employees act in a fair and impartial manner in all business dealings. Employees
are strictly prohibited not to accept gifts or other benefits provided by or to persons or
firms with whom TCI Group maintains or may establish business relationships and for
which fair market value is not paid by the recipient.
As a general rule, employees must act lawfully, reasonably and with moderation in
connection with business courtesies. Employees must exercise good judgment and avoid
even the appearance of impropriety or illegality.

Comment to Article 21: Employee of TCI Group and its subsidiaries should not indulge himself/herself in the conflict of
interest with the TCI Group and/or its subsidiaries or any other organization/entity with which TCI Group and/or its
subsidiaries have business relations. In the discharge of official duties, if at any stage an employee observes conflict of
interest, he/she should immediately inform in writing to his/her superiors/management.

27

22.0 ETHICAL CONSIDERATIONS


TCI Group & its subsidiaries officers and staff shall at all times in the performance of
their assigned duties:

conduct themselves in a manner consistent with the highest ethical standards


including the companys conflict of interest policy and will purchase without
prejudice;

uphold their positions of trust in the conservation and expenditure of company


funds; and

be vigilant in preserving and protecting the integrity of the company through daily
contacts and business dealings.

Comment to Article 22: TCI Group and its subsidiaries have earned its brand value in the corporate world by adhering to
the highest ethical standards. It is expected from the employees of TCI Group and its subsidiaries to represent the
company while maintaining the ethics, during office and in personal capacity.
28

23.0 RELATIONS WITH VENDORS


Sound business relations with vendors are essential in order to maintain a dependable,
competent source of supply for the uninterrupted flow of quality goods and services.
Honesty, integrity, confidence and tact should be employed by purchasing staff to
establish and maintain mutually satisfactory bonds of respect and understanding with
vendors. These relationships will enable purchasing staff to enhance the reputation of
the company in the course of their duties, building goodwill that will serve the company
well in all of its activities.
In this regard, the following should be observed when dealing with vendors and their
representatives in these circumstances:

23.1 Interviews/Meetings
It is a major obligation of purchaser to be courteous, honest and fair in its dealings with
vendors representatives, for such treatment is expected by the company for its
representatives/staff. Courtesy shall include a prompt reception to business callers and
a reasonable regard for their time. Sales representatives shall be afforded a fair and equal
opportunity to present legitimate and pertinent information concerning materials,
equipment, methods or techniques that the vendor company markets.
Vendor representatives will be seen only by appointment, as unscheduled sales calls are
of little or no benefit to either party. The time of both purchasing and other company
personnel will not be made absolutely and indiscriminately available to any and all
comers.
Other company personnel shall be given every opportunity to discuss with vendors new
developments, materials, methods or ideas that may result in cost reduction or
improvements. The Central Purchase Section shall assist vendors representatives in
developing and maintaining proper relations with other company staff and are to be
informed of the results of consultations with vendors.
Contacts with vendors are not limited to the Central Purchase Section. However, the
Central Purchase Section shall be kept up to date on all communications either through
vendor or employee reports. This will allow the companys communications with vendors
to be consistent, and Central Purchase Section will be advised of programs and matters
that may result in eventual purchases.

23.2 Visit to Vendors


The Central Purchase Section shall, if required and approved by senior management,
make purposeful visits to vendors. Such visits serve to: cement good relations; enable
buyers to know their sources of supply, including the caliber of service, quality,
progressiveness, and manufacturing methods; and broaden their knowledge of the
commodities they purchase.

29

23.3 Trials
The Central Purchase Section shall be receptive to new commodities and ideas that
appear beneficial to the company. Use of new or different products or services may be
suggested by the Central Purchase Section or by other divisions/departments. Since
testing is expensive, tests should be restricted to those products that appear most
promising.

23.4 Disclosure of Information


All employees shall promote the reputation of the company for integrity by respecting the
confidence of the vendor regarding quotations or other confidential information. Prices
shall not be divulged to competitors nor should such information be circulated
indiscriminately within the company.
The Central Purchase Section shall advise employees having access to information
regarding supply sources, competitive performance, bids or prices paid for any product
or service that this information is proprietary and may not be divulged to anyone outside
the company.
Upon specific request, unsuccessful bidders should be told as fully as possible, without
disclosing confidential information, the reason for rejecting their bids. All questions
concerning the awarding of business should be referred to the Central Purchase Section.

23.5 Claims and Adjustments


The clearance and execution of all claims and adjustments arising out of disputes
regarding performance of equipment, materials, services or price shall be referred to the
Central Purchase Section for negotiation and/or resolution. In doing so, it may be
necessary for the Central Purchase Section to involve other company personnel or
departments.

23.6 Research & Development


We expect our vendors to apply every possible method of examination and measurement
to their products and services in a continuous search for better value. We encourage our
vendors to inform us about new ideas and developments. It is the responsibility of the
Central Purchase Section to receive maximum advantage from this readily available
source of constructive ideas and applications. We shall keep our vendors fully and
currently informed but shall not disclose information considered confidential or
potentially detrimental.

Comment to Article 23: The representatives of firms/vendors should be invited and treated with full dignity; however it
must be ensured that invitation be sent to only those firms/vendors whose association or contribution is productive to
the valuable time of TCI Group and its subsidiaries.

30

24.0 RELATIONS WITH OTHER DIVISIONS/DEPARTMENTS


A high degree of coordination and communication between divisions/departments is
paramount. Members of the Central Purchase Section should obtain the advice of other
specialized divisions/departments on problems relating to their respective areas of
interest so that decisions reflect the most authoritative opinion available.
Although vendor contact is primarily a responsibility of the Central Purchase Section, it
is recognized that various divisions/departments must seek technical information that
may affect the selection of materials or equipment. This information may impact a
potential purchase; the Central Purchase Section must be advised so the potential
bidders lists can be developed. Upon request, the Central Purchase Section will arrange
for visits of qualified technical personnel from suppliers or potential suppliers. Similarly,
whenever the Central Purchase Section feels that such representatives calling on Central
Purchase Section have something of value to offer, they will arrange meetings with
appropriate company personnel. If appropriate, a representative of the Central Purchase
Section will be present at these meetings. When convenient, further contacts, requests
for samples, etc., arising from such meetings are to be handled through the Central
Purchase Section. Written reports of meetings should be circulated to the Central
Purchase Section and other interested parties.
The effectiveness and efficiency of the Central Purchase Section depends greatly on the
amount of advance notice of requirements. Therefore the Central Purchase Section must
receive adequate notification of potential purchases to provide for sufficient performance
of the necessary procurement functions. All departments should advise Central Purchase
Section of any requirements likely to arise from any new development as soon as this
information is available.
Price information will only be given by Central Purchase Section to those within the
company who require this information in the performance of their duties. In interviews
with salespeople, no one shall commit himself to a vendor on preference for any product
or source of supply, nor give any information regarding a competitive suppliers
performance, final approval or price. Requests by vendors for information of this nature
shall be denied.

Comment to Article 24: The cordial relations between central purchase section, divisions, departments, sections, units
and internal audit are of paramount importance for effective purchase system on competitive prices and to maintain the
integrity and reputation of the TCI Group and its subsidiaries.

31

PURCHASE PROPOSAL REQUEST FORM

ANNEXURE-I

TRANSPORT CORPORATION OF INDIA LIMITED


Page____of______

File No._________

Officer-in-Charge Administration
Transport Corporation of India Limited
Corporate Office, Sector 32, Gurgaon
Indent No.:____________________________________
Department : __________________________________
Indenter Employee Code.:________________________
Ship Code, if applicable: _________________________

Indent Date___________
Quotation Attached (Y/N)

TYPES OF MATERIAL: PURCHASE ORDER TYPE


Type of Material

Purchase Order Type

Consumable
Non-Consumable
Limited Time Asset

Normal
Repeat Order
Rate Contract

Please tick where ever-applicable

Item Category________________________________

ITEM DETAILS OF REQUIRED ITEMS


S.No.

Complete
Description
of Items
(Specification
Model, Catalog No.)
Use separate Sheet if
Required

Stock Held on
Date
(Wherever
applicable)

Quantity
Required

Purpose

Approx
Units Price

Approx Total
Cost

Total Cost

BUDGET DETAILS
S.No.

Department Name

Budget Head

Suggested Supplier
S.No.
Name

Budget Amt.

Address

1) Whether items are available in Stores:


Y/N
2) Certified that Allocation exist for the above Amount
Indenters Signature

HOD (Signature)

Approval Authority (Signature)

Name:________________________________________
Email ________________________________________

32

ANNEXURE-II

REQUISITION FORM FOR IMPORTED ITEMS


** PLEASE MAKE ALL ENTRIES IN CAPITAL LETTERS**
(IN TRIPLICATE)

TRANSPORT CORPORATION OF INDIA LIMITED

Department _____________________________________________
Date __________________________________________________

Requisition No. _______________

Indentors Name_________________________________________
Employee Code _________________________________________

Designation _________________
Ship Code, if applicable: ________

Mode of Shipment _____________________________________________________________________


Type of Goods
Consumable
Non-Consumable
Limited Time Asset

S.No.

Particulars/Description of
the items as given in
quotation/invoice of the
supplier. (use CAPITAL
letters)

QTY.

Country of
Import

Value in foreign
currency

Value in Indian
Currency

Quot. No. _____________


Date _________________

TOTAL FOB VALUE =


TOTAL CIF/C&F VALUE =
DISCOUNT IF ANY =
AGENCY COMMISSION =
FREIGHT =
INSURANCE =
Other details /charges if any =
SUPPLIERS FULL ADDRESS
(IN CAPITAL LETTERS)

Indenters Signature

_______________
LOCAL AGENTS FULL ADDRESS
( IN CAPITAL LETTERS)

HOD (Signature)

Approval Authority (Signature)

Enclosures :1. proforma invoice (three copies) valid for 60 days.


2. list of goods (6 copies )
3. end use certificate, NMLC, Proprietary certificate
4. check list

33

ANNEXURE-III

SUPPLIER REGISTRATION FORM

TRANSPORT CORPORATION OF INDIA LIMITED


Firms Name
Owners Name
Full Postal Address

E-Mail Address
Web Address
Contact Persons Name
Contact No.

Landline (with area code)

Mobile

Fax (with Area Code)

UPTT No.

CST No.

TIN No.

PAN No.

TAN No.

Service Tax No.

Bank A/C No.

Bank

Branch Code

Sales Tax Number


(enclose Xerox copy)

Numbers
(enclose Xerox copy)

Excise Number
(enclose Xerox copy)

Bank RTGS Details


Bank A/C Details
Manufacturer/Supplier

Manufacturer
1.
2.

Supplier

In case of supplier please enclose authorization of your Principal


List of the organizations to whom the materials have been supplied

Item(s) name you want to


supply: (Major category)

Signature with Seal


Note: Supplier must print CST/UPTT/TIN/TAN/PAN No. on their Letter Head/Bill/Quotations

34

SUPPLIERS RENEWAL REGISTRATION FORM

ANNEXURE-IV

TRANSPORT CORPORATION OF INDIA LIMITED


Earlier Registration Number
(Allotted by TCI)

Firms Name
Owners Name
Full Postal Address

E-Mail Address
Web Address
Contact Persons Name
Contact No.

Landline (with area code)

Mobile

Fax (with Area Code)

UPTT No.

CST No.

TIN No.

PAN No.

TAN No.

Service Tax No.

Bank A/C No.

Bank

Branch Code

Sales Tax Number


(enclose Xerox copy)

Numbers
(enclose Xerox copy)

Excise Number
(enclose Xerox copy)

Bank RTGS Details


Bank A/C Details
Manufacturer/Supplier

Manufacturer
1.
2.

Supplier

In case of supplier please enclose authorization of your Principal


List of the organizations to whom the materials have been supplied

Item(s) name you want to


supply: (Major category)

Signature with Seal


Note: Supplier must print CST/UPTT/TIN/TAN/PAN No. on their Letter Head/Bill/Quotations
35

PROPRIETARY CERTIFICATE FORM

ANNEXURE-V

TRANSPORT CORPORATION OF INDIA LIMITED

I hereby certify to the best of my knowledge and belief that the stores indented for are of proprietary dealers being
M/s ---------------------------------------------------------------------------------------------------- and the requirement of
the Company will not be met by any substitute stores due to the following reasons:

1. ----------------------------------------------------------------------------------------------2. ----------------------------------------------------------------------------------------------

This is against purchase indent No. ----------------- Dated --------------------

Indenter Signature
with office seal

Approval Authority Signatures


With office seal

Date:

36

LEFT BLANK INTENTIONALLY

37