Rule 155 of The General Financial Rules 2017 Purchase of goods by Purchase Committee
Original Rule Text
Visual Summary
For goods not on GeM, costing Rs. 50,000 to Rs. 5,00,000.
Duly constituted Local Purchase Committee (LPC) with three members.
Jointly certifies quality, reasonable price, and reliable supplier.
Executive Summary
Rule 155 of the General Financial Rules, 2017 outlines the procedure for purchasing goods not available on the Government e-Marketplace (GeM) portal, specifically for items costing between Rupees fifty thousand and Rupees five lakh. Such purchases are to be made based on the recommendations of a Local Purchase Committee, which must conduct a market survey and jointly certify the quality, reasonableness of price, and reliability of the chosen supplier before a purchase order is placed.
In-Depth Analysis of the Rule
Introduction: Rule 155 provides a structured approach for procuring goods when the primary online marketplace, GeM, does not offer the required items. This ensures transparency and due diligence for mid-value purchases.
Breakdown of the Rule:
- Applicability: This rule applies to purchases of goods that are not available on the GeM portal.
- Cost Threshold: It covers goods with a value exceeding Rupees fifty thousand (Rs. 50,000) and up to Rupees five lakh (Rs. 5,00,000) on each occasion.
- Local Purchase Committee (LPC): A purchase under this rule requires the recommendations of a duly constituted Local Purchase Committee. This committee must consist of three members, appointed at an appropriate level as decided by the Head of the Department.
- Committee’s Role: The LPC is tasked with surveying the market to determine the reasonableness of the rate, quality, and specifications of the goods. It is also responsible for identifying an appropriate supplier.
- Joint Certification: Before recommending the placement of a purchase order, all members of the committee must jointly record a certificate. This certificate must affirm their satisfaction that the goods meet the requisite specifications and quality, are priced at the prevailing market rate, and that the recommended supplier is reliable, competent, and not debarred by the Department of Expenditure or the Ministry/Department concerned.
Practical Example: A government department needs to procure specialized laboratory equipment costing Rs. 3,50,000, which is not listed on the GeM portal. Following Rule 155, the Head of the Department constitutes a three-member Local Purchase Committee. The committee conducts a market survey, compares offers from various vendors, and identifies a supplier offering the equipment at a competitive price with the required specifications. Before finalizing, the committee members jointly sign a certificate confirming the quality, fair price, and reliability of the supplier, ensuring compliance with the rule.
Related Provisions
Understanding Rule 155 is enhanced by looking at other procurement methods outlined in the General Financial Rules, 2017:
- Rule 154 of The General Financial Rules 2017 Purchase of goods without quotation: Covers purchases up to Rs. 50,000 without inviting quotations.
- Rule 158 of The General Financial Rules 2017 Purchase of goods by obtaining bids: Details standard methods for obtaining bids for higher value procurements.
Learning Aids
Mnemonics
- LPC’s 3 C’s: Constitute, Certify, Commit (to purchase).
Process Flowchart
Multiple Choice Questions (MCQs)
1. According to Rule 155 of the General Financial Rules, 2017, for what value range of goods (not on GeM) is a Local Purchase Committee required?
- A) Up to Rs. 50,000
- B) Above Rs. 50,000 and up to Rs. 5,00,000
- C) Above Rs. 5,00,000 and up to Rs. 10,00,000
- D) Any value above Rs. 10,000
Show Answer
Correct Answer: B) Above Rs. 50,000 and up to Rs. 5,00,000
2. How many members must a Local Purchase Committee consist of, as per Rule 155 of the General Financial Rules, 2017?
- A) Two members
- B) Three members
- C) Five members
- D) Number varies based on department size
Show Answer
Correct Answer: B) Three members
3. What must the Local Purchase Committee jointly certify before recommending a purchase order under Rule 155 of the General Financial Rules, 2017?
- A) Only the lowest price offered.
- B) Only the technical specifications.
- C) Reasonableness of rate, quality, specifications, and reliability of the supplier.
- D) The urgency of the purchase.
Show Answer
Correct Answer: C) Reasonableness of rate, quality, specifications, and reliability of the supplier.
4. Under Rule 155 of the General Financial Rules, 2017, what is the primary condition for this procurement method to be used?
- A) The goods are available on the GeM portal.
- B) The goods are not available on the GeM portal.
- C) The purchase is for a new service.
- D) The purchase is below Rs. 10,000.
Show Answer
Correct Answer: B) The goods are not available on the GeM portal.
5. Who decides the appropriate level of members for the Local Purchase Committee under Rule 155 of the General Financial Rules, 2017?
- A) The Ministry of Finance
- B) The Accounts Officer
- C) The Head of the Department
- D) The supplier
Show Answer
Correct Answer: C) The Head of the Department
Frequently Asked Questions
Q1: What is the purpose of the Local Purchase Committee under Rule 155?
The Local Purchase Committee (LPC) is constituted to survey the market, ascertain the reasonableness of rates, quality, and specifications of goods, and identify appropriate suppliers for purchases not available on GeM and falling within the specified value range.
Q2: Can Rule 155 be used for any value of goods not available on GeM?
No, Rule 155 specifically applies to purchases costing above Rupees fifty thousand (Rs. 50,000) and up to Rupees five lakh (Rs. 5,00,000) on each occasion. Other rules govern purchases outside this range.
Q3: What is the significance of the joint certificate by the Purchase Committee members?
The joint certificate is crucial as it formally records the committee’s collective satisfaction regarding the quality, fair market price, and reliability of the recommended supplier. This ensures accountability and adherence to financial propriety before a purchase order is placed.
Key Takeaways
- Rule 155 governs non-GeM purchases between Rs. 50,000 and Rs. 5,00,000.
- A three-member Local Purchase Committee (LPC) is mandatory for such procurements.
- The LPC must conduct a market survey to ensure competitive pricing and quality.
- Joint certification by the LPC members on quality, price, and supplier reliability is a critical step.
Conclusion
Rule 155 of the General Financial Rules, 2017, provides a vital framework for ensuring transparent and financially prudent procurement of goods when the standard GeM platform is not applicable. By mandating a Local Purchase Committee and a rigorous certification process, it safeguards public funds and promotes accountability in government purchasing decisions for mid-value items.