Types of Tenders in Government

Types of Tenders in Government

In earlier article, we studied how procurement of goods and services is done with or without quotation in Government. The process and limits specified for procurement with or without quotation have also been detailed. In this article, we will study how tender is used in public procurement. We know that the procurement rules can easily be understood by categorizing the purchases in various types like, (i) Purchase Without Quotation, (ii) Purchase With Quotations, (iii) Tender System, (iv) Online Procurement

(iii) Tender System:

The central and state government organizations in India, are fully empowered to make their own arrangements for procuring goods and services. However, the procuring authorities are bound to follow the rules in procurement. The rules sometimes become so complicated to ensure the compliance and in such cases, the procurement process is usually delayed and even most of the times, the procurement is cancelled during the process itself.

Role of Directorate of Supplies and Disposal (DS&D) and GeM:

On behalf of Government, the Directorate of Supplies and Disposal was empowered to make the purchases. Now the same has been replaced with Government e-Marketplace (GeM) organization. In case of procurement through tender, the departments provide the details of annual requirement to the Directorate of Supplies and Disposal (DS&D) and the DS&D further float the tender for procurement of goods on behalf of departments. For this purpose, the DS&D charges administrative charges from the departments. After award of tender, the supplier is negotiated and agreed to deliver the goods on the basis of Rate Contract (RC) between the department and supplier. Now such contracts have taken the shape of e-contracts and the suppliers have been asked to provide or upload the details of their products online at the portal of Government e-Marketplace (GeM).

Types of Tenders:

There are three types of tenders i.e. open tender, limited tender, and single tender.

(a) Limited Tender:

In case of amount of purchase becomes more than the speficied limit of quotations (i.e. Rs. 1 Lac in Central Government and Rs. 50000 in Haryana Government); it becomes mandatory to float the tender. In such cases, the tender details are provided in the form of Tender Document also known as Bid Document. The Tender Document is sold to the vendors or supplier interested to give their bids. In order to make wide publicity, the advertisement is provided on the website of the government organization, at notice board of the organization, and to all the suppliers registered with the organization (i.e. on panel of the organization) for supply of goods and services.

Generally, the bid document is sent through speed post or registered post. At least one week’s period is provided to give the bid for supplying goods as per the details provided in the bid document.

In Central Government Organizations, the specified limit for such tenders is from 1 Lac to 25 Lac. In Haryana Government, generally the limited tenders are not floated, only open tenders are floated; however, the organizations can take approval of the procuring authorities to float limited tender.

(b) Open Tender:

In case, the amount of procurement is more than the amount specified for the limited tender; then open tender is floated by the procuring authorities. In open tender, wide publicity is done with advertisement in Indian Trade Journal, One National Daily Newspaper having wide circulation across the nation, and the same is published on the websites of organization and NIC’s website.

In open tender, three-week period is provided to the vendors or suppliers to apply with the bid.

(c) Single Tender:

The single tender is applicable when there is only one supplier or vendor to supply the goods or services. It happens in case the goods are manufactured only by a particular vendor or supplier and there is no competitor. It can also happen if there is emergent need to procure the goods and there is no time to wait even for the limited tender. The third case may be related to technical specifications of the goods or services. Sometimes, only a particular company can provide the standardized service required by the organization, then also single tender can be used for procurement purposes.

In case, limited tender or open tender is used and only single bid is received then such tender is not known as ‘single tender’. The Single tender is applicable in only above three circumstances i.e. only a particular firm is the manufacturer or emergent need to procure from a particular source or technical reason is recorded citing standardization of machinery or service.

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