Rule 149 of The General Financial Rules 2017 Government eMarket place GeM
Original Rule Text
(i) [Up to [(Rs.50,000/-)]through any of the available suppliers on the GeM, meeting the requisite quality, specification and delivery period].
Note: In case of automobiles, procurement under this sub-rule is permitted without any ceiling limit.
(ii) Above [Rs.50,000/- and up to Rs.10,00,000/-]through the GeM Seller having lowest price amongst the available sellers of at least three different manufacturers, on GeM, meeting the requisite quality, specification and delivery period. The tools for online bidding and online reverse auction available on GeM can be used by the Buyer even for procurements less than [Rs 10,00,000].
(iii) Above [Rs.10,00,000/-]through the supplier having lowest price meeting the requisite quality, specification and delivery period after mandatorily obtaining bids, using online bidding or reverse auction tool provided on GeM.
(iv) The invitation for the online e-bidding/reverse auction will be available to all the existing Sellers or other Sellers registered on the portal and who have offered their goods/services under the particular product/service category, as per terms and conditions of GeM.
(v) The above-mentioned monetary ceiling is applicable only for purchases made through GeM. For purchases, if any, outside GeM, relevant GFR Rules shall apply.
(vi) The Ministries/Departments shall work out their procurement requirements of Goods and Services on either “OPEX” model or “CAPEX” model as per their requirement/ suitability at the time of preparation of Budget Estimates (BE) and shall project their Annual Procurement Plan of goods and services on GeM portal within 30 days of Budget approval.
(vii) The Government Buyers may ascertain the reasonableness of prices before placement of order using the Business Analytics (BA) tools available on GeM including the Last Purchase Price on GeM, Department’s own Last Purchase Price etc.
(viii) A demand for goods shall not be divided into small quantities to make piecemeal purchases to avoid procurement through L-1 Buying / bidding / reverse auction on GeM or the necessity of obtaining the sanction of higher authorities required with reference to the estimated value of the total demand.
Visual Summary
Goods/Services on GeM must be procured through it.
Different monetary ceilings for direct, L-1, and bidding purchases.
Procuring authorities must certify the reasonability of rates.
Executive Summary
Rule 149 of the General Financial Rules, 2017, mandates the use of the Government e-Marketplace (GeM) for procuring common use goods and services. It outlines a tiered procurement process based on monetary value, ranging from direct online purchases for small amounts to mandatory bidding or reverse auction for higher values. The rule emphasizes the certification of supplier credentials by GeM SPV and the reasonability of rates by procuring authorities. It also prohibits the division of demands to circumvent procurement procedures and requires Ministries/Departments to project annual procurement plans on the GeM portal.
In-Depth Analysis of the Rule
Rule 149 establishes the Government e-Marketplace (GeM) as the primary platform for government procurement, aiming to enhance transparency, efficiency, and competition. This rule makes it mandatory for Ministries and Departments to procure goods and services available on GeM, with specific procedures tailored to different transaction values.
Breakdown of the Rule
- Mandatory Use of GeM: All Ministries and Departments must use GeM for goods and services available on the platform.
- Supplier Credentials and Rate Reasonability: GeM SPV certifies supplier credentials, while procuring authorities must certify the reasonability of rates.
- Tiered Procurement Process:
- Up to Rs. 50,000: Direct online purchase from any available supplier meeting quality, specification, and delivery. (Note: No ceiling for automobiles).
- Above Rs. 50,000 and up to Rs. 10,00,000: Purchase from the GeM Seller with the lowest price among at least three different manufacturers. Online bidding/reverse auction tools can be used.
- Above Rs. 10,00,000: Mandatory online bidding or reverse auction to select the lowest price supplier meeting quality, specification, and delivery.
- Scope of Online Bidding/Reverse Auction: Invitations are open to all registered sellers offering goods/services in the relevant category.
- Applicability of Monetary Ceilings: These ceilings apply only to GeM purchases; outside GeM, other GFR Rules shall apply.
- Procurement Planning: Ministries/Departments must determine OPEX/CAPEX models and project annual procurement plans on GeM within 30 days of Budget approval.
- Price Reasonability Tools: Government buyers can use Business Analytics tools on GeM, including Last Purchase Price, to confirm price reasonability.
- Prohibition of Demand Splitting: Demands for goods must not be split into small quantities to make piecemeal purchases to avoid higher authority sanctions or GeM procedures.
Practical Example
A Ministry needs to procure office stationery worth Rs. 45,000. According to Rule 149(i) of The General Financial Rules, 2017, they can directly purchase this from any supplier available on GeM, provided the quality, specification, and delivery period are met. If the same Ministry needs to procure new computers worth Rs. 7,00,000, they would follow Rule 149(ii), selecting the GeM seller with the lowest price among at least three different manufacturers. For a large-scale IT infrastructure project costing Rs. 15,00,000, Rule 149(iii) would apply, requiring mandatory online bidding or reverse auction to secure the lowest price from a qualified supplier.
Related Provisions
Rule 149 is part of a broader framework governing public procurement and financial management. Other relevant rules include:
- Rule 144 of The General Financial Rules, 2017: Fundamental Principles of Public Buying – Lays down the overarching principles for all public procurement.
- Rule 147 of The General Financial Rules, 2017: Powers for Procurement of Goods – Details the delegated powers for procuring goods, often referencing GeM.
- Rule 150 of The General Financial Rules, 2017: Registration of Suppliers – Describes the process for registering suppliers, especially for items not on GeM.
Learning Aids
Mnemonics
- GeM MANDATE: Mandatory, Automobiles (no limit), No splitting, Direct purchase (up to 50K), Above 50K (L-1, 3 manufacturers), Ten Lakhs+ (bidding), Expenditure planning.
Multiple Choice Questions (MCQs)
1. According to Rule 149 of the General Financial Rules, 2017, for what purpose was the Government e-Marketplace (GeM) established?
- A) To manage government employee payrolls.
- B) For common use Goods and Services procurement.
- C) To track government financial liabilities.
- D) For inter-departmental fund transfers.
Show Answer
Correct Answer: B) For common use Goods and Services procurement.
2. Under Rule 149(i) of the General Financial Rules, 2017, what is the monetary ceiling for direct online purchases through GeM?
- A) Up to Rs. 10,000/-
- B) Up to Rs. 50,000/-
- C) Up to Rs. 1,00,000/-
- D) No ceiling limit.
Show Answer
Correct Answer: B) Up to Rs. 50,000/-
3. For procurements above Rs. 10,00,000/- on GeM, as per Rule 149(iii) of the General Financial Rules, 2017, what is the mandatory procedure?
- A) Direct purchase from any certified supplier.
- B) Selection from L-1 seller among three manufacturers.
- C) Mandatory online bidding or reverse auction.
- D) Approval from the Ministry of Finance.
Show Answer
Correct Answer: C) Mandatory online bidding or reverse auction.
4. What is explicitly prohibited by Rule 149(viii) of the General Financial Rules, 2017, regarding demand for goods?
- A) Procuring goods on an OPEX model.
- B) Certifying the reasonability of rates.
- C) Dividing a demand into small quantities to avoid procurement procedures.
- D) Using Business Analytics tools for price assessment.
Show Answer
Correct Answer: C) Dividing a demand into small quantities to avoid procurement procedures.
5. According to Rule 149(vi) of the General Financial Rules, 2017, when should Ministries/Departments project their Annual Procurement Plan on the GeM portal?
- A) Within 7 days of Budget approval.
- B) Within 15 days of Budget approval.
- C) Within 30 days of Budget approval.
- D) At the end of the financial year.
Show Answer
Correct Answer: C) Within 30 days of Budget approval.
Frequently Asked Questions (FAQs)
Is it mandatory for all government departments to use GeM for procurement?
Yes, Rule 149 of The General Financial Rules, 2017, explicitly states that procurement of goods and services by Ministries or Departments will be mandatory for items available on GeM.
What is the role of GeM SPV in the procurement process?
GeM SPV is responsible for ensuring adequate publicity of items on GeM and certifying the credentials of suppliers registered on the platform. Procuring authorities, however, certify the reasonability of rates.
Can a Ministry split a large procurement demand into smaller parts to avoid higher bidding requirements?
No, Rule 149(viii) of The General Financial Rules, 2017, strictly prohibits dividing a demand for goods into small quantities to make piecemeal purchases, specifically to avoid procurement through L-1 Buying/bidding/reverse auction on GeM or the necessity of obtaining sanctions from higher authorities.
Key Takeaways
- GeM is the mandatory platform for common use goods and services procurement by government entities.
- Procurement procedures are tiered based on monetary value, ranging from direct purchases to mandatory bidding/reverse auctions.
- Emphasis is placed on certifying supplier credentials and the reasonability of rates to ensure fair and transparent transactions.
- Splitting procurement demands to circumvent rules is strictly prohibited, promoting comprehensive and accountable purchasing.
Conclusion
Rule 149 of The General Financial Rules, 2017, is a cornerstone of modern government procurement in India. By mandating the use of GeM and establishing clear, tiered procedures, it aims to foster transparency, efficiency, and accountability in public spending. Adherence to this rule ensures that government purchases are made judiciously, offering the best value for public money while promoting a competitive and fair marketplace for suppliers.