Goods and Service Contracts

through
Government e-Marketplace
(GeM)
Sachin Patnaik, IRSS
B. E . (Mechanical Engg), PGDSCM, AMPPP
Presently posted as: Sr. Professor (MM)
National Academy of Indian Railways, Vadodara.
What is GeM?
Government e-Marketplace.
Transformation of DGS&D to a digital ecommerce
portal for procurement and selling of goods and
services.
Section 8 (Non-Profit) Private Limited Company
under the Ministry of Commerce to develop,
manage and maintain the GeM platform.
Aims to enhance transparency, efficiency and
speed in public procurement.
Mandatory as per Rule No. 149 in the General
Financial Rules, 2017.
Rule 147 - GFR
The Ministries or Departments have
been delegated full powers to make
their own arrangements for
procurement of goods and services,
that are not available on GeM.
Common use goods and services
available on GeM are required to be
procured mandatorily through GeM as
Rule 149.
Rule 149 - GFR
Government E-Marketplace (GeM) for
common use Goods and Services.
GeM SPV will ensure adequate publicity.
Mandatory for Goods or Services
available on GeM.
The credentials of suppliers on GeM
shall be certified by GeM SPV.
The procuring authorities will certify the
reasonability of rates.
“GOODS”
Article / product or an intangible product
like software, technology transfer, licenses,
patents or other intellectual properties.
It also include works and services which are
incidental or consequential to the supply of
such goods, such as, transportation,
insurance, installation, commissioning,
training and guarantee / warrantee
obligations as defined in the scope of supply
given in the contract.
“SERVICES”
Services offered or provided by the
Seller such as IT Professional Services,
Manpower Services, Security Services,
Transport Services, etc. listed as
Services on GeM. The term ‘Service’
shall also include supply of goods /
articles which are incidental or
consequential to the provisioning of
such Services as defined in the scope
of supply given in the contract.
Modes of procurement
Direct Purchase- Up to Rs. 25,000/-.
Direct L1 Purchase- Rs 25,000/- to Rs
5,00,000/- (Rs 30L for automobiles).
Bid/RA above Rs. 5,00,000/-
RA(Reverse Auction)- Recommended for
high value orders.
For purchases, if any, outside GeM,
relevant GFR Rules shall apply.
Splitting is prohibited.
 Important points:
Purchase outside GeM:
• For purchases, if any, outside GeM, relevant GFR Rules shall
apply.
• Buyer to generate a "GeM Availability Report and Past
Transaction Summary" (GeMAR&PTS) with a unique ID for
procurement outside GeM.
• Unique ID would be required to be furnished on the publishing
portal during publishing of tender.
• Exception is allowed in case of:
• Urgency.
• Non-functioning of GeM at that time. (The tender publishing portal will
automatically confirm from the GeM in real time)
• Non availability of internet connection. (Deleted)
• Screenshots to be placed in procurement files.
Custom Catalogue Based Bid
• Categories not part of the available GeM
categories.
• Sellers participate on the basis of requirements
defined by the buyer.
• Allows buyer to create custom catalogue by
providing Title, Reference price, selling unit,
specifications, drawing documents, reference
images etc.
• Bunching of 2 or more catalogues allowed.
• Minimum reference value is Rs 5 lakh.
• Minimum bid duration is 21 days.
 Bid Life Cycle:
 90 days.
 Can be configured to 120 / 150 or 180 days in exceptional cases through
catalogue Management System (CMS) for a particular product category.
 Buyers can incorporate suitable eligibility criteria and additional terms
and conditions only using various filters and ATC.
 Corrigendum through Request Management System.
 Indispensable conditions not covered in and not in conflict with
GeM GTC, Product / Service STC and the standard ATC library.
 In compliance with the Govt. orders on Public Procurement.
 Non- restrictive.
 Not against the core principles of transparency, fairness and
efficiency.
 The sellers are free to bid for same, equivalent or superior specifications
catalogue / products.
Technical and Financial Suitability

 Clarification from the bidder can be asked online during Technical

scrutiny.
 If any offer is made unsuitable, the firm gets a message
accordingly. The Bidder has to respond within 48 hours from the
clarification request initiation time.
 Reasonableness of prices to be done using the Business Analytics
(BA) tools available on GeM including the LPR on GeM/ Own
LPR.
 In case of identical lowest bid price,
 RA for goods.

 For services,
 Auto selection by GeM through Random Algorithm.
 Selection of any seller by buyer.
 EMD:
o DoE letter dated 12.11.20 – No EMD, only Bid security declaration.
o For compelling circumstances, with approval of next higher authority/
secretary of the ministry/deptt.
o No EMD up to Rs 5 lakh.
o EMD = 0.5% to 5%.
o Exemptions:
o Micro and Small Enterprises - Manufacturer of the Primary Product Category
or Service Provider of the Primary Service Category and give specific
confirmation to this effect at the time of bid submission and whose
credentials are validated online through Udyog Aadhaar and through
uploaded supporting documents. NSIC, DIC regd.,
o BIS license holders.
o Start-ups as recognized by Department of Industrial Policy and Promotion
(DIPP).
o KVIC, ACASH , WDO, Coir Board, TRIFED and Kendriya Bhandar.
o Verified Sellers by Vendor Assessment Agencies for the Primary Product /
Primary Service.
o Sellers having annual turnover of Rs 500 Crore.
 EMD (CONTD…):
 Validity of EMD: Bid validity + 45 days.
 Buyer can raise a request with authorized signatory of
GeM to enable offline EMD submission.
 EMD in form of DD/FDR/Banker’s cheque/Online
payment.
 Return of EMD: within 15 days after the award of
contract or expiry of bid validity whichever is earlier.
EMD of successful bidder shall be returned within 15
days after receipt of Performance Security / e-PBG.
PERFORMANCE SECURITY:
o DoE letter dated 12.11.20 – 3% SD.
o For higher SD due to compelling circumstances,

with approval of next higher authority/ secretary of

the ministry/deptt.
 No PBG for
 Value below 5 lakhs.
 Direct Purchase/L1 purchase.
 @2% to 10% of the value.

 Validity: 2 months beyond date of completion.

 To be submitted within 15 days of contract. PBG can

be in the form of DD/FDR/Online payment also.
 Return of security within 30 days of completion.
 Bid Splitting:
 In case of critical/vital/safety/ security
items.
 large quantity under procurement.
 urgent delivery requirements.
 inadequate vendor capacity,
 Buyer to indicate Bid Splitting ratio in
which order will be split among L-1, L-
2, L-3 etc as per ratio of splitting to be
pre-disclosed.
*Some useful points:
Qty increase/decrease:
Buyer can increase/decrease up to 25% of the
original quantity before the contract generation and
increase up to 25% of the original quantity after the
contract generation.
Evaluation Methods other than L1:
- QCBS and Least cost method of assessment for any
Bid.
- Buyer to upload the formula and scoring method
for all parameters.
- Buyer to upload a document at the time of scoring
evaluation.
*Standard Guarantee/Warrantee:
One year.
To rectify, replace,
compensate within 7 days.
Spares: for an agreed price
for a minimum period of three
years from the date of expiry
of warrantee period.
* CRAC to be generated within 10 days of PRC.
* Rejection: remove / lift back within 10 days. If not lifted
within reasonable time period, right to dispose at the risk and
cost of the seller.
* Payment: within ten (10) days of issue of CRAC.
* LD: @ 0.5% per week not exceeding 10%.
* Force Majeure Conditions :
* notice within 10 days from the date of occurrence
* if the performance is prevented or delayed by more than 10
days, either party may at its option terminate the contract.
* Dispute Resolution:
* Amicable solution: co-ordination committee to be formed by the
Buyer and Seller/Service Provider, chaired by the Primary along
with representatives from Buyer Department and Seller.
* Arbitration.
 * Some useful points:
TERMINATION OF CONTRACT
*Mutual consent.
*Breach of contractual obligations:
*No remedy within 14 days after receiving notice.
*Breach of SLAs: i) Cumulative penalties rise to 10% of the
contract value
ii) Repeated breach of any SLA beyond 3 instances as per
buyer discretion.
Cancellation of contract:
Goods: Once the buyer raises a request for cancellation of
contract, it will automatically be reflected on the Seller
Dashboard. Five days to accept or auto-declined.
Services: Offline.
*New features added/to be added
(GeM 4.0):
A technology roadmap - involving
Analytics,
Hyper ledger with smart contracts
using block chain technology,
Artificial Intelligence,
Machine Learning and Deep
Learning.
GeM: New features for Buyers
1.Bid Cycle reduced to 3 days (for goods and
services), can be made up to to 2 days for time
critical items for covid items.
2.For purchase up to ₹5 lakhs, filters have been
enabled for
1.Local sellers for purchases.
2.Lead Time input.
3.MSE and MSE SC/ST.
4.Make in India.
3.D.P extension 30 days beyond expiry of original
delivery period.

Designed by GeM Training Team

• Adding up to 5 new specifications
parameters for an existing category
allowed.
• Drawing/ Scope of work can be uploaded
for certain categories.
• Staggered delivery is allowed.
• Supplementary invoice/CRAC can be
generated.
• Consignee-wise, item-wise bidding will be
activated soon.
 Questions??
Youtube videos for GeM
1. For vehicle hiring visit:
https://youtu.be/kpdSarZEyHY.
2. For goods visit:
https://youtu.be/zKly8bMv1TE
3. For passing & payment of bills, visit:
https://youtu.be/3CtKnUOjkhs
Please subscribe for future videos.
Sachin Patnaik
Sr. Professor (MM)
National Academy of Indian Railways
Vadodara – 390004
Email: sachinpatnaik@gmail.com.
M: 7008261664.