This document provides guidelines and procedures for public procurement and purchasing by autonomous educational organizations. It discusses key concepts like what constitutes a public purchase, the rules and regulations that must be followed, and the various stakeholders and processes involved like obtaining quotes, evaluating bids, and selecting vendors. The purpose is to ensure transparency, value for money, and fair treatment of suppliers in public purchases.

1. PURCHASE P ROCEDURE
For AUTONOMOUS EDUCATIONAL ORGANISATIONS
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2. What is Purchase?
Purchasing also known as procurement.
Means buying of all the materials, services,
works needed by the organization.
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3. PUBLIC PROCUREMENT
What is Public Procurement / public buying?
Public buying is different from private
buying in many ways.
Public buying needs to be transparent and
follow applicable rules, regulations and
existing policies.
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4. GUIDELINES FOR PUBLIC BUYING
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5. VARIOUS WATCH-DOGS

10. Rule 137 OF GFR – 2005
Fundamental principles of public buying
Every authority delegated with the financial
powers of procuring goods in public interest shall have the
responsibility and accountability to bring efficiency,
economy, transparency in matters relating to public
procurement and for fair and equitable treatment of
suppliers and promotion of competition in public
procurement.

11. FIVE GOLDEN RULES Of PURCHASES

12. GETTING RIGHT PRICE
1. Contact several vendors to find the best price.
2. A purchase discount / a trade discount can affect
prices.
3. Purchaser should be able to take advantage of a
quantity discount or a cash discount.
Quantity discount: a discount that a vendor gives to a buyer who places large orders.
Cash discount : an amount deducted from the selling price for payment within a
specified time period

13. Factors affecting the Right Price
Early Advance
Payment
without Bank
Guarantee
Advance
Payment against
Bank Guarantee
Payment within
30 days after
receipt of
Materials
Payment
Against
Delivery
Payment after
30 days from
date of receipt
of Materials

14. REASONABLE PRICE
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Important:
Last purchase price of same (or in its
absence, similar) item.
Current Market Price of the same or
similar item.
Price of raw materials which goes into the
item.

15. L1’s PRICE ABOVE“REASONABLE”
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LIMIT
• At first, we need to recheck the correctness of the
estimated value.
• If estimated price is the same then :-
• Price negotiation with the lowest technically accepted
tenderer.
• Re-tender with wide publicity with same terms and
conditions or with suitable modifications if necessary.
• IF L1’s PRICE IS BELOW REASONABLE LIMIT,
WHAT TO DO?

16. CHOOSING RIGHT VENDOR
Considerations in Vendor Selection
RELIABILITY
SERVICES DISTANCE

17. 17

18. STANDARD PURCHASE TERMS
TENDER - To invite bid as per requirement or to
accept a formal offer. QUOTATIONS – Same but for
smaller value.
BIDS – Same. Used when tenders are called in two
parts - Technical bid & financial bid.
NIT – Notice Inviting Tender through Newspapers /
website / .
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19. STANDARD PURCHASE TERMS
EVALUATION CRITERIA – Technical and financial
evaluation.
TECHNICAL BID – Technical specifications of goods / services
in question. Technical bid also include pre-qualification
criteria, details of quality and quantity of items to be
purchased. Period of supply, guarantee, warranty, etc. Should
also be included.
FINANCIAL BID – Financial quotation stating amount for
tender. It is also called PRICE BID.
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20. STANDARD PURCHASE TERMS
PENALTY CLAUSE – It is also called as Liquidated
Damages Clause. If contract is not honored then penalty
clause to be triggered. Penalty appx. 0.5% per week max.
5% of the contract value to be charged.
TERMINATION OF CONTRACT – One month notice from
both the side.
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FORCE MAJEURE – Natural Calamities.
AWARD OF CONTRACT – Issue of Purchase order / work
order or Service Contract to the bidder.

21. STANDARD PURCHASE TERMS
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INDENTER – Name of the Purchaser.
EVALUATION OF BIDS – Technical and financial
evaluation of bid for award of contract.
LAST DATE & TIME OF RECEIPT OF TENDERS –
Date and time after which tenders are not accepted.
PURCHASE ORDER – Contract Agreement.

22. TYPES OF TENDERS
Expression of Interest
Public Tender
Limited Tender
Global Tender
Request for Proposal (RFP)
Request for Quotations(RFQ)
E-tender
Percentage Rate Tender

27. CONTENTS OF TENDER DOCUMENT
As per GFR-155

28. CONTENTS OF TENDER DOCUMENT
As per GFR-155

29. CONTENTS OF TENDER DOCUMENT
As per GFR-155

31. EARNEST MONEY DEPOSIT
As per GFR-157:
It is security for not withdrawing /altering bid
once submitted.
It is charged 2% - 5% of bid value.
EMD is also known as Bid Security / Bid Bond.

32. PERFORMANCE SECURITY
As per GFR-158:
To ensure due performance of the contract,
performance security is taken from bidders.
It is charged 5% to 10% of Purchase Value.
Taken in the from of DD or Performance Bank
Guarantee.
Validity of PBG can very for 1 to 2 years.
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34. PROCUREMENT PROCESS
https://www.youtube.com/watch?v=aPO3fwYnaXA

35. TECHNICAL SPECIFICATIONS &
STANDARDS OF ITEMS
• Technical Specification and Standards of items
can be done by:
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 Reference sample.
 Drawings.
 Written technical specifications.
In many tenders, we may have to use combination
of two or more methods to make it more specific
to the bidders.

36. QUALITY ASSURANCE
We have to ensure that the ordered goods meets
contract specification and quality parameters as per
the purchase order.
We can do following following inspections and can
be written in tender document also such as:
1) Factory Inspection.
2) Pre-dispatch Inspection
3) Final Inspection after installation.
4) Commissioning & Acceptance at site.
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37. 37
DUTIES & TAXES
Custom Duty: At concessional Rate – 5% of Invoice
Value for RESEARCH ITEMS Only.
Excise Duty : Fully exempted for all RESEARCH
ITEMS Only.
Octroi: 5.5%.
Service Tax: 12.36%. But for auxiliary services, it is
exempted.
VAT/ CST: To be paid at actuals.

38. TECHNICALLY ACCEPTABLE SUPPLIER
A supplier who fulfils following two
criteria are technically accepted
suppliers:
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• Eligibility Criteria
• Qualification criteria.

39. ELIGIBILITY CRITERIA
• Supplier should be registered with
Government as Company, etc, having valid
PAN, Service Tax number, Gumasta
Licence, authorised Indian Agent, etc. as
per the Government norms.
• Suitable stipulations are to be incorporated
to ensure above norms in tender
documents.
• Many organisations do Vendor Registration
to confirm above facts before hand.
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40. QUALIFICATION CRITERIA
• The tenderer should be technically
capable with acceptable past record and
also financially sound to deliver the
goods as required.
• To ensure above, suitable stipulations to
be incorporated accordingly in the tender
enquiry document.
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41. LATE TENDERS
As per GFR-153:
In case of Advertised Tender Inquiry or Limited
Tender Inquiry, Late Bids (i.e. Bids received after
the specified date & time for receipt of bids)
should NOT be considered.

42. Tender Opening Procedure
Quotation / Tenders must be opened in the presence of
three members.
Suppliers may be allowed to attend tender opening
meeting.
All tenders / quotations including cover must be signed by
all members of the committee / Indentor or their
representative.
All corrections, overwriting should be attested by the
bidder and duly initialed by tender opining committee.

43. TENDER EVALUATION METHODS
1. Quality and Cost Based Selection (QCBS)
2. Quality Based Selection (QBS)
3. Fixed Budget Selection (FBS)
4. Least Cost selection (LCS)

44. TENDER EVALUATION
R E S P O N S I V E
T E N D E R S
T E N D E R S E V A L U A T E D
E Q U I T A B L E B A S I S
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(Single Envelop Model)
T E C H N I C A L L Y
U N R E S P O N S I V E
C O M M E R C I A L L Y
U N R E S P O N S I V E
T E N D E R S R E C E I V E D
T E N D E R S O P E N E D
B O T H
T E C H N I C A L L Y A N D
C O M M E R C I A L L Y
U N R E S P O N S I V E
U N R E S P O N S I V E
T E N D E R S
1 S T
L O W E S T
T E N D E R [ L 1 ]
O N
2 N D
L O W E S T
T E N D E R [ L 2 ]
3 R D
L O W E S T
T E N D E R [ L 3 ]
T E N D E R S R A N K E D
A N D E N T E R E D
I N T H E R A N K I N G
S T A T E M E N T
T E N D E R S A N A L Y S E D

45. 45
TENDER
EVALUATION
(Two Envelop Model) Technical Evaluation
Sanction of Estimate
Procedure of Inviting Tender
Technical Credentials
Project Delivery
Validity of Tender
Eligibility of Tenderer
Experience and capability
Quality & Functionality

46. 46
TENDER
EVALUATION
(Two Envelop Model)
Commercial Evaluation
Financial Profile
Price
Reasonableness of Rate

47. PAYMENT TERMS
Variety of payment terms & conditions are:
1) 100% payment after delivery & acceptance.
2) 100% payment against delivery.
3) Part payment in instalments.
4) Advance payment to party.
5) Payment through Letter of Credit.
6) Wire Transfer.
8) RTGS / NEFT payment (e-payment).

48. PAYMENT TO PARTY
Difference between:
1) Invoice.
2) Proforma Invoice.
3) Tax Invoice.
4) Bill.
5) Cash Memo.
6) Credit Memo.
7) Debit Note.

49. IMPORT PURCHASE
TERMINOLOGIES
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50. INTERNATIONAL COMMERCIAL TERMS
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(INCOTERMS)
• Published by the Internal Chamber of
Commerce, Paris.
The purpose of INCOTERMS is to provide a
set of International Rules dealing with the
relations between buyers and sellers in
foreign trade.

51. 51

52. 52

53. 53

54. LETTER OF CREDIT
https://www.youtube.com/watch?v=cz91gPU2bms
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55. 55

56. ADVANCE PAYMENT TO SUPPLIERS
Rule 159 of GFR:
1. It may become necessary to make advance payments in the following types of
cases:
1. Advance upto 30% to 50% of the value of goods and services against Bank
Guarantee may be considered as normal advance payment.
2. Advance payment above 50% with or without Bank Guarantee to considered
as unsecured advance payment and to be avoided. May be approved in rare cases
as a special case with approval of competent authority.
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57. QUOTE ANALYSIS
TOTAL COST OF OWNERSHIP
Total cost of any material includes:
1) Actual cost of Product.
2) All duties and taxes.
3) Transportation & Loading, unloading.
4) Installation and Commissioning.
5) AMC.
6) Spare parts.
8) Insurance, etc.
https://www.youtube.com/watch?v=lmOZPUlcTWg

58. STANDARD PRUCHASE COMMITTEE
REPORT
Purchase Committee should be approved by
Competent Authority.
Purchase Committee should includes:
1) Reason for acceptance of L1 or L2 as the
case may be.
2) Reason for rejection of Tenders in detail.
3) Reasons for recommending purchase from
technically qualified bidders.
4) Any other important information to be
documented related to said purchase.

59. E-PROCUREMENT
E-procurement means purchase using network through
software. In includes :
1. Indent management
2. E-Tendering
3. E-Auctioning
4. Vendor management
5. Catalogue management
6. Purchase Order Integration
7. Order Status
8. Ship Notice
9. E-Invoicing,
10. E-Payment
11. contract management