Rule 162 of The General Financial Rules 2017 Limited Tender Enquiry

Rule 162 of The General Financial Rules 2017 Limited Tender Enquiry

Visual Summary

Executive Summary

Rule 162 of the General Financial Rules, 2017, outlines the Limited Tender Enquiry (LTE) method for procuring goods. This method is primarily applicable for procurements with an estimated value of up to Rupees Fifty Lakhs. It mandates sending bidding documents directly to a list of registered suppliers, ensuring that more than three firms are invited to bid. Furthermore, organizations must publish these limited tender enquiries on the Government e-Marketplace (GeM), the Central Public Procurement Portal (GeM-CPPP), and their own websites to promote transparency. The rule also provides specific exceptional circumstances under which LTE can be adopted for procurements exceeding Rupees Fifty Lakhs, such as urgent demands, situations where an advertised tender is not in public interest, or when supply sources are definitively known and limited. Unsolicited bids are generally not accepted, but a system for future supplier registration should be in place.

In-Depth Analysis of the Rule

Introduction: The Limited Tender Enquiry (LTE) method, as detailed in Rule 162, serves as a streamlined approach for procuring goods, balancing the need for efficiency with the principles of competition and transparency. It is particularly suited for procurements that fall within a specified value threshold or meet certain exceptional criteria.

Breakdown of the Rule:

• Scope and Value Limit: The primary application of the LTE method is for goods with an estimated value of up to Rupees Fifty Lakhs. This threshold helps departments manage smaller-scale procurements more efficiently.
• Supplier Engagement: Bidding documents must be sent directly to firms registered as suppliers for the goods in question, as referenced under Rule 150. A crucial requirement is that the number of invited supplier firms must be more than three, with efforts encouraged to identify a higher number to foster competitive bidding.
• Publicity Requirements: To ensure transparency, organizations are mandated to publish their limited tender enquiries on GeM, GeM-CPPP, and their own official websites.
• Unsolicited Bids: The rule explicitly states that unsolicited bids should not be accepted. However, Ministries and Departments are encouraged to develop a system for interested firms to register and participate in subsequent rounds of tendering.
• Exceptions for Higher Value Procurements: LTE can be utilized even for procurements exceeding Rupees Fifty Lakhs under specific, justified circumstances:
  • When the competent authority certifies an urgent demand, and the additional expenditure incurred by not using an advertised tender is justified by the urgency. The nature of urgency and reasons for not anticipating the procurement must be recorded.
  • When there are sufficient, recorded reasons by the competent authority indicating that procuring through an advertised tender enquiry would not be in the public interest.
  • When the sources of supply are definitively known, and the possibility of identifying new sources beyond those already being considered is remote.
• Time for Bid Submission: Adequate time must be provided for the submission of bids in all LTE cases.

Practical Example: A government department needs to procure specialized laboratory equipment with an estimated value of Rs. 40 lakhs. Instead of initiating a lengthy advertised tender process, they opt for a Limited Tender Enquiry as per Rule 162. They identify five pre-qualified and registered suppliers known for providing such equipment. Bidding documents are sent directly to these five firms via email, and the tender is simultaneously published on GeM, GeM-CPPP, and the department’s website. A reasonable period of three weeks is given for bid submission, ensuring competitive responses while expediting the procurement process due to the moderate value of the equipment.

Related Provisions

Rule 162 is interconnected with other provisions that govern procurement and financial management:

• Rule 150 of The General Financial Rules 2017 Registration of Suppliers: This rule is directly referenced in Rule 162, as LTE relies on sending bidding documents to firms borne on the list of registered suppliers.
• Rule 161 of The General Financial Rules 2017 Advertised Tender Enquiry: This rule outlines the method for higher value procurements, serving as a contrast to LTE and the default if LTE exceptions are not met.
• Rule 144 of The General Financial Rules 2017 Fundamental Principles of Public Buying: Provides the overarching principles of efficiency, economy, transparency, and fair treatment that all procurement methods, including LTE, must adhere to.

Learning Aids

Mnemonics

• LTE: Limit, Three, Exceptions, Time. (Limited Tender Enquiry: Value Limit, More than Three suppliers, Exceptions for higher value, Sufficient Time for bids).

Process Flowchart

Multiple Choice Questions

Frequently Asked Questions

Key Takeaways

• Limited Tender Enquiry (LTE) is primarily for goods valued up to Rs. 50 lakhs, but exceptions exist for higher value procurements under specific conditions.
• It mandates inviting bids from more than three registered suppliers to ensure a competitive process.
• Publication of limited tender enquiries on GeM, GeM-CPPP, and the organization’s own website is compulsory for transparency.
• Unsolicited bids are generally not accepted, but a system for future supplier registration should be developed.

Conclusion

Rule 162 of the General Financial Rules, 2017, provides a practical and efficient framework for procuring goods through Limited Tender Enquiries. By setting clear value limits, mandating competition among registered suppliers, and ensuring public visibility through online portals, the rule strikes a balance between administrative expediency and the fundamental principles of transparency and fairness in public procurement. Adherence to its provisions is crucial for Ministries and Departments to conduct procurements effectively while maintaining financial propriety and public trust.