PROCUREMENT OF CONSULTANCY AND

OTHER SERVICES THROUGH

QCBS

26th April 2022

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PUBLIC BUYING DEFINITION
Covers the procurement of
MATERIALS/WORKS/SERVICES by all
government ministries, departments, public
sector undertakings under the Central Govt. and
the States, Municipal Corporations and other
agencies using public fund.

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 Average annual procurement value
Approximate average annual procurement value is around Rs. 12000-15000
Crores depending on the requirement of the capital equipment
Last Year Published tender :

Financial Year 2020-21

2020-21
S.No Organisation
No. of Tenders Value of Tenders (Rs. In Crore)
1 Bharat Coking Coal Limited 8,021 8,309.07
2 Central Coalfields Limited 5,395 30,395.66

3 Central Mine Planning and Design Institute Limited 349 1,151.80

4 Coal India Limited 48 3,831.45
5 Eastern Coalfields Limited 4,503 5,132.07

6 Indian Institute Of Coal Management 1 0.04

7 Mahanadi Coalfields Limited 2,641 18,802.72
8 North Eastern Coalfields, Margherita 39 13.09
9 Northern Coalfields Limited 3,242 10,246.88
10 South Eastern Coalfields Limited 5,030 21,432.26
11 Western Coalfields Limited 3,827 9,320.46

Total 33,096 108,635.50

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Method of Procurement
Global/Domestic Open Tenders
Limited Tenders with facility for participation by other bidders – Open Limited
Tenders
Proprietary Purchases
Depot Agreements
Rate Contracts / Running Contracts
Procurement through GeM portal
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What is Consultancy?
 A consultancy firm or simply consultancy is a professional service firm that
provides expert advice for a fee.
 When consultancy and implementation are clubbed, it is called outsourcing.
 Types of Consultancy:-

 i) Strategy Consultancy
 ii)Management Consultancy
 iii) Operations
 iv) HR
 v) Financial Advisory
 IT related matters

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BACKGROUND
 1.10 When is Procurement of Services justified
 1.10.1 Consultancy Services:
 Rule 178& 180 of GFR 2017, permits Ministries/ Departments to
hire external professionals, consultancy firms or consultants
(referred to as consultant hereinafter) for a specific job, which
is well defined in terms of content and time frame for its
completion. Engagement of consultants may be resorted to in
situations requiring high quality services for which the Procuring
Entity does not have requisite expertise. Approval of the
competent authority should be obtained before engaging
consultant(s).

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BACKGROUND-----
 We may justify need for Procurement of Consultancy Services on
consideration of:-
 i) The inadequacy of Capability or Capacity of required expertise in-
house;
 ii) The need to have qualified consultant for providing a specialized
high quality service;
 iii) Need for expert advice from a consultant acting independently
from any affiliation, economic or otherwise to avoid conflicts of
interest;
 iv) The need in some cases for transfer of
knowledge/training/capacity and capability building as a by-product
of such engagement;
 v) Need to acquire information about/identifying and implementing
new methods and systems; vi) Need for planning and implementing
organizational change;
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BACKGROUND-----

 vii) There may be internal capacity/capability to

do the job but there are considerations of
economy, speed and efficiency in relation to
additional requirement/commitment/usage of;
 a) Staff/Management/Organization;
 b) Technological and Material Resources;
 c) Money and
 d) Time/Speed of execution
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Consulting versus non-consulting services
 Consulting services are of an intellectual and advisory nature requiring
evaluation of technical proposals that offer tailored approaches,
methodologies, and specially qualified experts
 Non consulting services include
 (i) services for which the physical aspects of the activity predominate, that
are bid and contracted on the basis of performance of a measurable physical
output, and for which performance standards can be clearly identified and
consistently applied; or
 (ii) routine services which, while requiring expert inputs, are based on
recognized standard offerings that are readily available and which do not
require evaluation of tailored methodologies or techniques.

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Non-Consulting Services
• means the reasonable costs of services for which the
physical aspects of the activity predominate and are bid
and contracted on the basis of performance of
measurable physical output, which include, but are not
limited to, cleaning, maintenance, transport, data
management, translation, printing, communication,
publication and repairs.

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Other (Non-consultancy) Services
 1.10.2 : In the interest of economy, efficiency and to provide more
effective delivery of public services, GFR, 2017 permits
Ministries/Departments to procure/outsource auxiliary and support
services. Approval of the competent authority should be obtained
before engaging service providers.
 i) Economy, speed and efficiency and more effective delivery of public
services relating to additional requirement/commitment/usage of:
 a) Staff/Management/Organization;
 b) Technological and Material Resources;
 c) Money and
 d) Time/Speed of execution. ii) An administrative policy decided by the
Ministry/Department to outsource specific (class

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1.14 Public Procurement Cycle
 The entire process of procurement and implementation of Consultancy and
other services shall include the following steps:
 i) Preparation of Concept Paper/Procurement Proposal and obtaining in
principle approvals;
 ii) Preparation of the ToR (in case of consultancy services)/Activity
Schedule(in case of other/non-consultancy services), cost estimate and
seeking administrative and budgetary approval;
 iii) Short list of consultants - EoI formulation, publication, receipt of proposals
and evaluation;
 iv) Preparation and issuance of the RfP; Receipt of proposals; Evaluation of
technical proposals: consideration of quality; Evaluation of financial proposals;
Selection of winning proposal; Negotiations and award of the contract to the
selected firm; and
 v) Monitoring of Assignments.
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Conflict of Interest in case of
Consultants
 i) The consultant is required to provide professional, objective and impartial
advice, at all times holding the Procuring Entity’s interests paramount,
strictly avoiding conflicts with other assignments or his/its own corporate
interests and acting without any consideration for future work.
 ii) The consultant has an obligation to disclose to the Procuring Entity any
situation of actual or potential conflict that impacts its/his capacity to serve
the best interest of its client/ Procuring Entity. Failure to disclose such
situations may lead to the disqualification of the consultant or termination of
its/his contract during execution of the assignment.

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 Without limitation on the generality of the foregoing and unless stated otherwise in
the data sheet for the RfP document, the consultant shall not be hired under the
circumstances set forth below:
 a) Conflicting activities: A firm that has been engaged by the client to provide
Goods, Works, or Non-consultancy services for a project, or any of its affiliates, shall
be disqualified from providing Consultancy service resulting from or directly related
to those Goods, Works, or Non-consultancy services. Conversely, a firm hired to
provide consultancy services for the preparation or implementation of a project, or
any of its affiliates, shall be disqualified from subsequently providing Goods or Works
or Non-consultancy services resulting from or directly related to the consultancy
services for such preparation or implementation;
 b) Conflicting assignments: Consultants (including its experts and sub-consultants)
or any of their affiliates shall not be hired for any assignment that, by its nature,
may be in conflict with another assignment of the consultant for the same or for
another Procuring Entity; and
 c) Conflicting relationships: A consultant (including its/his experts and
subconsultants) that has a close business or family relationship with a professional
staff of the Procuring Entity who are directly or indirectly involved in any part of: 1.
the preparation of ToR for the assignment; 2. selection process for the contract; or 3.
supervision of the contract, may not be awarded a contract, unless the conflict
stemming from this relationship has been resolved in a manner acceptable to the14
client throughout the selection process and execution of the contract.
 Unfair Competitive Advantage in case of
Consultants
 Fairness and transparency in the selection process require
that the consultants or their affiliates competing for a
specific assignment do not derive an unfair competitive
advantage from having provided consultancy services
related to the assignment in question. Such unfair
competitive advantage is best avoided by full transparency
and by providing equal opportunity so that all firms or
individuals interested or involved have full information
about a service assignment and its nature, scope and
background information. To that end, the request for
proposals and all information would be made available to
all short listed consultants simultaneously
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Obligations for Proactive Disclosures
 i) Procuring authorities as well as bidders, suppliers, contractors and
consultants/service providers, are obliged under Code of Integrity for Public
Procurement to suo-moto proactively declare any conflicts of interest (coming
under the definition mentioned above – pre-existing or as and as soon as these
arise at any stage) in any procurement process or execution of contract. Failure
to do so would amount to violation of this Code of Integrity; and
 ii) Any bidder must declare, whether asked or not in a bid document, any
previous transgressions of such a Code of Integrity with any entity in any
country during the last three years or of being debarred by any other Procuring
Entity. Failure to do so would amount to violation of this Code of Integrity;
 iii) To encourage voluntary disclosures, such declarations would not mean
automatic disqualification for the bidder making such declarations. The
declared conflict of interest may be evaluated and mitigation steps, if possible,
may be taken by the Procuring Entity. Similarly, voluntary reporting of previous
transgressions of Code of Integrity elsewhere may be evaluated and barring
cases of various grades of debarment, an alert watch may be kept on the
bidders’ actions in the tender and subsequent contract.
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Types of Contracts
 There are different basis for linking payments to the performance of services
(called types of contracts) – each having different risks and mitigation
measures. Bids are called and evaluated based on the type of contract. The
choice of the type of contract should be based on Value for Money (VfM) with
due regard to the nature of assignment. Adoption of an inappropriate type of
contract could lead to a situation of lack of competition, contractual disputes
and nonperformance/failure of the contract. Each type of contract are
associated with risks and mitigation measures. Mostly used types of contracts
are:
 i) Lump-sum (Firm Fixed Price) contract;
 ii) Time based (Retainer-ship) contracts;
 iii) Percentage (Success Fee) contract;
 iv) Retainer-ship cum Success fee based contract;
 v) Indefinite delivery contract.

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Systems of Selection of Service Providers
 The nomenclature of various selection methods below is in line with generally
prevalent nomenclature and therefore, varies slightly from the terms used in
the 2006 version of Finance Ministry’s ‘Manual of Policies and Procedure of
Employment of Consultants’.
 i) Price based System – Least Cost Selection (LCS)
 ii) Quality and Cost Based Selection (QCBS)
 iii) Direct Selection: Single Source Selection (SSS)

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QCBS process
 In QCBS selection, minimum qualifying marks (normally 70-80 (Seventy – Eighty)
out of maximum 100 (Hundred) marks) as benchmark for quality of the technical
proposal will be prescribed and indicated in the RfP along with a scheme for
allotting marks for various technical criteria/attributes. During evaluation of
technical proposal, quality score is assigned out of the maximum 100
(Hundred) marks, to each of the responsive bids, as per the scheme laid down
in the RfP. The consultants/service providers who are qualifying as per the
technical evaluation criteria are considered as technically responsive and the rest
would be considered technically non-responsive and would be dropped from the
list. Financial proposals are then opened for only eligible and responsive
offers and other financial offers are returned unopened to bidders.
 The financial proposals are also given cost-score based on relative ranking of
prices, with 100 (Hundred) marks for the lowest and pro-rated lower marks
for higher priced offers. The total score shall be obtained by weighting the
quality and cost scores and adding them. The weight given to the technical score
may not be confused with the minimum qualifying technical score (though they
may in some case be equal).
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Quality and Cost Based Selection (QCBS)
Description Remarks Quality/Cost Score
Weighting (%) in QCBS
High Use QCBS with higher 80/20
complex/downstream technical weightage
consequences/specialised
assignments
Moderate complexity Majority of cases will 75-65/35-25
follow this range
Assignments of a standard Use of LCS is appropriate 60-50/40-50
or routine nature such as
auditors/ procurement
agents handling the
procurement

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QCBS - Risks and Mitigations
Risk
Inappropriate Selection of QCBS: There
is a possibility that QCBS system is
selected where LCS or other systems
would have been more appropriate
considering the quality requirements or
the capability of Procuring entity to
monitor the assignment
Weightage of Technical: Cost may not be
proportional to quality requirements
Technical criteria may not be relevant to Technical criteria selected should be
realization of quality of assignment
Mitigation
Selection of QCBS should be justified
and applied only under circumstances
mentioned above.
Weightage different from 70:30
(Seventy: Thirty) should be adequately
examined and justified.
relevant and proportional to the
requirement of quality of assignment
and the selection process should be
rigorous enough to ensure that on one
hand no technically unsatisfactory bids
should be able to get past a loose 21
criteria and on the other hand no
Risk
Marking Subjectivity: The scheme of
marking or its application may be
subjective.
Mitigation
It is important to lay down as objective
a scheme of marking as possible. Cases
where subjectivity is unavoidable (as in
evaluation of methodology etc), a
system of grading responses and their
marking may be laid down in the
bidding documents. Procuring Entity
should also have a system of
conciliation and moderation of widely
disparate markings by different
members of evaluation committee.
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CIL Experience
 CIL has used QCBS in its consultancy cervices in ERP tender for the first time.
 QCBS quality ratio was fixed at 65/35.

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 Salient Points of DPR
• Phased deployment approach
Phase-I : CIL (including NEC, RSO’s and New Delhi Office), MCL and WCL
Phase-II : All remaining subsidiaries after the Phase-I has gone live
• A single instance of ERP software installed on centralized hardware to ensure high
level of process standardization
• Scope of Work for ERP & HMS – Critical Business Processes
• Eligibility Criteria (Minimum Qualification Requirement)
• Methodology of Bid Evaluation (QCBS Criteria – Technical Evaluation Matrix)
• Conducting Proof of Concept / Live Demo
• Selection of ERP software (for Phase-I & Phase-II) and System Integrator (SI) for
Phase-I based on Quality Cum Cost Based selection, with 65% weightage to
Technical score and 35% weightage to Financial score
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• Tender for Phase-II after Go-live stage of Phase-I

 Methodology for Technical Bid Evaluation
• Methodology of evaluation of bids as per QCBS has been adopted from the ‘Manual for
procurement of Consultancy and other services’ released in April, 2017 by Ministry of
Finance, GoI.
• Bidder response will be evaluated and bids of only those vendors, who meet the Minimum
Qualification Requirements (MQR), will be considered for further evaluation.
• Technical Evaluation (100 marks)
a) 20 marks assigned for live demonstration and Proof-of-concept (POC) to be given by
the vendor as per the demo-scripts provided.
b) Bidders to be given score out of remaining 80 marks (excluding 20 marks of POC
demo) as per Technical Evaluation Matrix on the basis of submitted information and
supporting documents furnished regarding technical evaluation parameters.
c) Only those bidders, who obtain a total Technical Score of 75 or above, out of 100, and
a minimum score of 10 (out of 20) in POC demo, will qualify for further evaluation.
Net Technical Score of a bidder = (Technical Score of the bidder say T)/ (Highest
25 Technical Score say
Thigh) x100
where T is the technical score of other bidder
 Methodology for Price Bid & QCBS Evaluation
• Price Bid Evaluation
• Net landed prices will be arrived at after including GST, as indicated in the BOQ, for
evaluation purposes.
• Total Cost of ownership (TCO) will be determined by calculating NPV of Net landed
price @ discount rate of 7.921 % per annum, on the basis of payment outflow as per
activity chart
• The bid having the lowest Total Cost of Ownership (TCO) shall be termed as the lowest
evaluated bid and will be awarded 100 marks. Financial score of other bidders will be
calculated on the basis of the following formula

Financial score of other bidder = TCO of lowest bidder x 100 / TCO of the other
bidder
• Total Score as per QCBS Evaluation
• Total score of the bidder will be determined based on the following
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formula:

Total score = 0.65 * Net Technical score + 0.35 * Financial score

 POC & Opening Part-I

• Three bidders namely, M/s Tech Mahindra, M/s L&T Infotech and M/s TCS
requested for Proof-Of-Concept (POC) demo script on 28.12.2017 after bid
submission ended.
• Live Demo & POC was held on 24th & 25th Jan, 2018, with all the three bidders as
per given POC Demo Script ( given after bid submission end date) and allocated
time slot. Marks were allocated to each bidder by POC Demo Evaluation
Committee and these scores were kept in sealed covers.

• Part-I Bid of the following firms was opened on 29.01.2018:

1) M/s Tech Mahindra limited
2) M/s L&T Infotech
3) M/s TCS Limited
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 ERP Tendering – Technical Scrutiny (Part-I)

• Initial Technical Scrutiny Report by Technical Evaluation Committee (TEC) was

submitted on 14.02.2018.
• Tender Committee (TC) meeting was held on 15.02.2018 & 04.03.2018,
deliberation on TEC recommendations were done and TC recommended to seek
Shortfall documents/ clarifications form all the bidders.
• Request for Shortfall documents / Clarifications (As per RFP provisions, bidders
were given one chance to upload shortfall documents/ clarifications within a
period not exceeding 15 days i.e. 15 X 24 hours) were uploaded on 06.03.2018
• Submission of Shortfall documents/clarifications by bidders ended on 21.03.2018
and final TEC report was submitted on 07.04.2018.

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 Outcome of Final TEC Report

1 Bids of M/s L&T Infotech and M/s Tech Mahindra are meeting MQR provisions
of RFP

2 Bid of M/S TCS did not comply to the MQR provisions of RFP

3 Tender Committee (TC) meeting held on 11.04.18 deliberated on Final TEC

report, opening of POC/ Demo score of bidders meeting Minimum
Qualification Requirements (MQR), recommendation for opening of price bids
of M/s L&T Infotech Limited and M/s Tech Mahindra Limited.

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 Net Technical Score

Live
Technical Total Technical
Demo/ Net Technical
Sl. No. Name of Bidder Score Score
POC score.
(Out of 80) (Out of 100)
(Out of 20)

1 M/s L&T Infotech Limited 74 18.20 92.20 98.87

2 M/s Tech Mahindra Limited 74 19.25 93.25 100.00

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 Opening of Price Bid

TC recommended as under :
• The offer of M/s TCS Limited may not be considered for further evaluation as
it does not meet the MQR requirement of RFP.
• To open the price bid of M/s L&T Infotech Ltd. and M/s Tech Mahindra Ltd.

• After approval of competent authority the price bids of M/s L&T Infotech Ltd.
and M/s Tech Mahindra Ltd. were opened on 31.05.2018 and Net Financial
Score of the two bidders was evaluated.

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 Net Financial Score

Sl Bidder Total Cost Without Net landed prices Total Cost Of Net Financial
no. GST (in Rs) including GST (in Ownership in INR Score (in Rs)
Rs) with NPV (in Rs)

257,05,08,380.55 303,31,99,889.05 268,80,22,748.14

1 M/s L&T Infotech Ltd. 88.13
(257.05 Crs) (303.32 Crs) (268.80 Crs)

228,81,96,228.60 270,00,71,549.75 236,90,10,631.70

2 M/s Tech Mahindra Ltd. 100.00
(228.82 Crs) (270.00 Crs) (236.90 Crs)

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 Calculation of QCBS Score of Bidders
Bidder Technical POC Score Total Net Proportionate TCO Financial Proportionate Total
Name Score Technical Technical Technical (Rs. Crs.) Score Financial Score Score
Score Score Score i.e., (Lowest i.e., with 35%
(Score / Price/ Bid weightage
(Out of 80) (Out of 20) (Out of Highest with 65%
weightage Price ) x
100) Score) x
100 100 (B) (A+B)

(A)

M/s L&T
InfoTech 74 18.20 92.20 98.87 64.27 268.80 88.13 30.85 95.12

M/s Tech
Mahindra 74 19.25 93.25 100.00 65.00 236.90 100.00 35.00 100.00

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 Price Justification – M/s Tech Mahindra
1 The Price quoted for ERP license including ERP engine by other bidder is also in
the same range hence it justifies that the price quoted for the same is
competitive.

2 We (M/s TM) have proposed solution with minimal customisation and therefore
we have included Newgen for workflow Pilog for data migration and SAP for
payroll etc. in our solution. This has increased the software license cost but
helps in reducing implementation cost and thereby optimizing the overall cost to
CIL.

3 HMS quoted by us is a standard proven software product and having ATS

percentage in par with other standard software OEM’s in the market. We are
enclosing order copies from other customers to justify that the ATS process
quoted by us for HMS are in line with industry standard.
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 Price Justification - TC

1 M/s Tech Mahindra Ltd. has achieved highest total score as per QCBS evaluation
system (the bidder has also quoted the lowest price in terms of Total Cost of
Ownership and has highest technical score)

2 Total Cost of Ownership (TCO) of the lowest bid is 6.86% lower than the
estimated price.
3 • Derived unit price of Engines & PU Licenses together, quoted by M/s Tech
Mahindra Ltd. works out to Rs. 57748.21
• Unit price of MOIL (order copy obtained through WCL), BPCL and subsequent
MOIL order (submitted by M/s Tech Mahindra Ltd.) are higher than the Derived
unit price of Engines & PU Licenses of M/s Tech Mahindra Ltd.

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 ERP Tendering – QCBS Evaluation (Part-II)

• In view of the fact that the Total Cost of Ownership (TCO) of the lowest bid is 6.86%
lower than the estimated price, the price has been discovered through an open e-tender
process, detailed justification furnished by L1 bidder and subsequent examination and
acceptance thereof by CIL consultants, the TC was of the view that the offer of M/s Tech
Mahindra Ltd. who have achieved highest “Total Score” as per QCBS evaluation system
(the bidder has also quoted the lowest price in terms of Total Cost of Ownership and has
highest Technical Score), may be considered for acceptance and conclusion of contract
at their quoted rates.

• The TC recommended to accept the offer of M/s Tech Mahindra Ltd. and conclude
contract for implementation of ERP and HMS at CIL and its Subsidiaries (Phase – I), on
them for Rs. 270,00,71,549.75 including all taxes and duties excluding optional supply
and services.

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Other Experiences
 ERP Phase 2
 Digitisation Tender
 Appointment of Consultant by CV Div.

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Recent Government Guidelines
 On 29th October 21, PPD, MoF has issued detailed guidelines where QCBS has
also been allowed in Works and Non Consultancy Services.
 Salient points for Works
 i) QOP- Quality Oriented Procurement- To be approved by Board or atleast
two level higher than approving authority.
 Non Consultancy Services
 i) upto Rs 10 Crores
 Weightage for Non Financial parameters upto 30%
 JVs should be avoided.

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Delegation of Powers at CIL for Consultancy Services
1. GUIDELINES FOR APPOINTMENT OF CONSULTANT ORGANISATIONS
(forappointment of individual as consultant, proposal must be brought to Board separately)
•These Guidelines shall include the appointment of entities as :
•Technical Experts
•Auditors (except Statutory Auditors who are appointed by C&AG)
•Stock Verification Consultants
•Lawyers
•Consultant for Company Secretarial matters
•Management Consultants
•Tax Consultants
•Company law consultants
•Any other consultantas as may be decided by the competent authority.

2. These guidelines shall not apply to full time/part time advisors for which appropriate guidelines
have already been framed by the Company.

3. Efforts should be taken to design the eligibility criteria in such a manner that Indian consultancy
firms are given priority over foreign counterparts.

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Contd…
4. International experience should be given preference in cases only when the
Indian firm/Company is a subsidiary/associate/JV of the concerned foreign body.
Care should be taken for such cases where Indian companies having similar
names as of the foreign body having no or very less experience may take
advantage.

5. The remuneration structure of the consultants must be framed before the

appointment process is floated and the same must not be based on L1 criteria. It
is important for the company to appoint good quality consultants and payment of
reasonable remuneration will result in the appointment of quality consultants.

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 Contd…

6. At least 33-50% points should be given for the presentation to be made by the
consultants to be appointed before the appropriate Committee in respect of :
•Infrastructure of Office
•Software / Hardware usage
•Approach towards the concerned job
•Proposed strategy and its implementation
•Detailed scope and understanding of the assignment.

7. While appointing, it must be made clear to the appointees that they are to remain
accountable for their Report and Advice in all cases and shall give appropriate affidavit /
declaration to the Company before taking the assignment.

8. The appointed Consultant while accepting the assignment must specify the team
members and must ensure in writing that at least 10% man-hours required for the
assignment shall be devoted by the senior consultant/partner of the firm in letter and
spirit. It is also important to ensure that such senior consultant/partner authenticate the
report and is present during the time of presentation of final report.
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Contd..
9.The appointment procedure shall generally be by way of open tender
(Fee and selection criteria is to be pre-determined) except in cases of
urgency when limited tender may be floated. Even in cases of such
urgency, it shall be mandatory to publish the requirement adequately in
advance in the CIL e-tender website/ eprocure.gov.in/GEM portal.

10.The requirement of open tender shall not apply to Institutions of

National repute like IITs, IIMs, ISM,ICAI,ICSI, ICMAI and similar bodies
established under an Act of Parliament / Institutes of national or
international repute and likewise as recorded in writing by the
appointing authority.

11.While appointing consultants, no preference of location or proximity to

be given except in special cases where the same is justified and that too
after proper justification and approval by the competent authority.

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 Contd…
 12. The appointment of Consultants must adhere to the following limits :
 i. Board of Directors : Full powers
 ii. Committee of Functional Directors headed by CMD : Full powers for Individual
Consultants
 iii. Chairman / CMD : Full powers for Company/Partnership firm/LLP Consultants
 iv. Functional Directors / CVO for respective functions : Upto ₹25 lakhs in each case
subject to a limit of ₹2 Crores per annum for Company/Partnership firm/LLP
Consultants. However, the same must be informed to the Board.
 v. Executive Directors for respective functions : upto ₹10 lakhs for
Company/Partnership firm/LLP Consultants. However, the same must be informed to
the Board.
 vi. GM for respective functions : Upto ₹5 lakhs for Company/Partnership firm/LLP
Consultants. However, the same must be informed to the Board. Second engagement
of the same person/entity will be subject to the approval of next higher level, in
case appointment is made within a period of 12 months. The above limits are same
for both CIL and its Subsidiaries.
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Contd…
 13. While determining terms of appointment for specific assignments / jobs an
expert committee can be constituted by the next hierarchy level together with
equal number of external experts in the respective field so that the eligibility
criteria, scope of assignment, reporting requirement, working papers and
documentation and fees and remuneration may be decided.

 14. The competent authority may appoint a consultant without inviting any
bid based on expertise/reputation of specific person /entity which may be
brought on record. The delegated power in this regard for appointment on
nomination basis is limited to 50% of delegated power as above. The reason for
appointment on nomination basis will be recorded in writing

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THANK YOU

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Goods vs Services

Goods include: Every kind of movable property Actionable claims Growing crops, grass and things
attached to or forming part of the land which are agreed to be severed before supply or under a
contract of supply.
 A goods does not include: Money and Securities

 Whether actionable claims liable to GST? As per section 2(52) of the CGST/SGST Act actionable claims
are to be considered as goods. Schedule III read with Section 7 of the CGST/SGST Act lists the activities
or transactions which shall be treated neither as supply of goods nor supply of services. The Schedule
lists actionable claims other than lottery, betting and gambling as one of such transactions. Thus only
lottery, betting and gambling shall be treated as supplies under the GST regime. All the other actionable
claims shall not be supplies and therefore GST is not applicable on it.

 “Services” means anything other than goods, money and securities but includes activities relating to
the use of money or its conversion by cash or by any other mode, from one form, currency or
denomination, to another form, currency or denomination for which a separate consideration is charged.

46
 Selection of System Integrator for Implementation
of SAP ERP at the six subsidiaries of CIL i.e. BCCL,
CCL, CMPDI, ECL, NCL and SECL.
______________________________________________
___

Tender No. : CIL/C2D/ERP Phase-II/2020/358 dated 18.06.2020

 Case at a Glance
• CIL board in its 344th meeting held on 10.08.2017 had accorded approval for Detailed Project Report (DPR) prepared by Consultant
MDI, Gurgaon for implementation of Enterprise Resource Planning (ERP) in CIL and its Subsidiaries in two phases at an estimate cost of
Rs. 651.49 Crores.

• CIL Board of Directors in its 402nd meeting advised to go for competitive bidding with revised crashed schedule without waiting for
implementation of Phase-I, instead of appointing the existing SI for Phase - II as well on nomination basis.

Sl Description Phase – I Phase – II

no.
1. Subsidiaries to be MCL, WCL and CIL HQ including NEC BCCL, CCL, CMPDI, ECL, NCL
covered and New Delhi office and SECL
2. Estimate Rs. 289.88 Cr. Rs. 132.31 Cr. (revised)
3. Awarded Value Rs. 270.01 R. 109.91 Cr. (Recommended)
4. LOA Date 31.07.18 To be issued
5. Contract Duration 64 Months 42 Months
Revised to 27.5 Months
6. Methodology QCBS QCBS
7. Tender Mode Domestic Open Domestic Open
8. Name of the Firm M/s Tech Mahindra Limited M/s Accenture Solutions Pvt.
Ltd.
 Salient Features of RFP / NIT

Drafting •Prepared by the ERP consultants in consultation with CIL.

•Examined and Recommended by RFP committee.
•Approved by Chairman, CIL
Mode Domestic Open tender
Pre- Bid Meeting Yes
AMC For 12 months after Go-Live and Stabilization
Period of Contract 27.5 months including stabilization and AMC period
Presentation A presentation of Skills to be made by each bidder for which they will be
given 10 days to prepare and 3 hours time for presentation.
The bid opening to happen only after Presentation.
Minimum Qualifying Score in Presentation is 15 out of 30
Methodology of QCBS with Minimum qualifying Technical score of 75 out 100.
Evaluation
 Salient Features of RFP / NIT
Contd.

Nature of Score Activity Marks Activity Marks

Technical score (T) Presentation 30 Financial Score (F) 100

Evaluation of Bid 70
Total 100 Total 100
Net Technical Score T of bidder X100/Highest Net Financial score L1 TCO X100/
(NT) T (NF) TCO of the
bidder
Total QCBS Score (NT) X 0.65 + (NF) X 0.35
• The bidder whose bid has secured the highest Total Score" as per above will be
considered as successful bidder.
• As per contract with M/s. Tech Mahindra SI for Phase I, there is a charge of INR 2,07,22,410.00 (including GST) for
positioning resources for 12 months to support Phase II SI. Therefore during the process of evaluation, the net
landed price (Including GST @ 18%) of bidders other than M/s. Tech Mahindra will be increased by an amount of INR
2,07,22,410.00, if M/s. Tech Mahindra, SI for phase I, participates in the bidding process for selection of SI for ERP
Implementation in Phase II Subsidiaries for like to like comparison. This amount will be added to the amount
payable after one year for the purpose of calculating NPV for final evaluation.
 Floating of Tender
• Based upon the duly approved RFP, BOQ and TPS a Domestic tender was floated Domestic tender no.
CIL/C2D/ERP Phase-II/2020/358 dated 18.06.2020

Pre-Bid Meeting:

• As per the RFP stipulation a Pre Bid meeting was held on 30.06.2020.

• In light of the Covid-19 restrictions the pre-bid meeting was held through Video Conferencing.

• The query raised by the bidder were discussed in detail in the meeting and all queries were responded to.
The bidders were also informed that the response of CIL is tentative and the final response shall be
uploaded in the portal which would form part of the RFP / NIT.

• As per the provisions of the purchase manual, the Pre Bid discussion was examined by the RFP committee
and comprehensive response to the discussion were finalized and the same was approved by Chairman, CIL.

• The final approved Pre Bid minutes was uploaded on the portal along with Do’s & Don’ts for bid submission.
 Response to Tender
• The initial due date for bid submission end date was 22.07.2020 and opening date was 06.08.2020.

• Thereafter, the bid submission date was auto extended two times as less than three bids were received.

• Before the extended bid submission end date, a request was received form M/s Accenture, for extension of
bid submission was received. After examining the request in consultation with ERP department the bid
submission end date was extended by 07 days with the approval of Director (Tech), CIL.

• The revised bid submission end date after extension was 05.08.2020 and bid opening date was 20.08.2020.
• The bid submission ended on 05.08.2020 at 11:00 AM
• As per the provisions of the RFP an email was activated for bidders to submit their bid submission
acknowledgement for obtaining the slot and the input for the presentation of specified skill.
• Both the participating bidders namely M/s Tech Mahindra Ltd. and M/s Accenture solution Pvt. Ltd requested
for slot and input for presentation of specified skill.
• The presentation was scheduled on 17.08.2020. Each bidder was allotted 3 hours' slot for giving the
presentation.
• Committee duly constituted with the approval of Director (Tech), CIL evaluated the presentation.
• Scores of the presentation in a sealed envelope was forwarded to MM department on 19.08.2020 for safe
 Opening of Part I Tender
• Part I of the tender was opened on 20.08.2020 and offer of the following two firms were received.
1. M/s Tech Mahindra Ltd.,
2. M/s Accenture solution Pvt. Ltd.

• EMD of Rupees One Crore has been submitted by both the participating bidders.
• After examining the initial offer of both the bidders and talking clarifications in two stages, the offer of all the
bidders have been found to be Techno-commercially acceptable.

• The final techno-commercial status of the four bidders participated is as under:

Sl No. Name of the Firm Techno-Commercial Technical Score

Status
1. M/s Tech Mahindra Ltd. Accepted 70

2. M/s Accenture Solutions Pvt. Ltd. Accepted 70

 Tender Committee (TC) recommendations dated 24.09.2020

• After detailed deliberations TC recommended as under:

1. To consider the offer of the following firms as techno-commercially acceptable and the
price bid submitted by these firms may be opened.
a. M/s Tech Mahindra Ltd.
b. M/s Accenture Solutions Pvt. Ltd.

• After Opening the price bid, an amount of Rs. 1,95,29,006.41 arrived after applying discounting factor
may be added to Total Cost of ownership, of M/s Accenture during evaluation.
 Price bid opening

• In line with the recommendation of TC, the price bid opening date was set as 25.09.2020 and was
intimated to the techno-commercially acceptable bidders on 24.09.2020 along with the technical scores.
Sl.No. Bidder Total Cost of Ownership Total price quoted with GST and
(Price with GST & NPV) not applying NPV
M/s Accenture Solutions Pvt.
1 Ltd. 108,35,51,762.41** 109,91,70,000.00
2 M/s Tech Mahindra Ltd. 122,63,63,073.25 126,24,74,313.96

** Total Cost of Ownership for firms other than M/s Tech Mahindra Limited had a loading factor of Rs.
1,95,29,006.41 arrived after applying discounting factor of 0.942410 to Rs. 2,07,22,410.00 for placement of
recourses by M/s Tech Mahindra Ltd. for phase II SI. Rs. 1064022756 + Rs. 1,95,29,006.41 = 108,35,51,762.41.
 NET TOTAL SCORE
1. Net financial Score

Sl.No. Bidder Total Cost of Ownership Net Financial score

(Price with GST & NPV) lowest Price /Individual Price*100

2. Total Net Score1 M/s Accenture Solutions Pvt. Ltd. 1083551762.41 100.00

2 M/s Tech Mahindra Ltd. 1226363073.25 88.35

Evaluated QCBS score of Eligible Bidders

Sl.No.
Bidder

Presentati Technica Total Net Technical Total Cost of Net Financial Total Net The successful

on Score l score Technical score. Ownership score score bidder

out of 30 score (Price with GST &

out of 70 out of 100 Individual NPV) lowest Price F*65% One with highest

score/highest /Individual +H*35% Net Score

score*100 Price*100

A B C D E F G H I J

1 M/s Accenture Solutions Pvt. Ltd. 24 70 94.00 100.00 1083551762.41 100.00 100.00 Accenture
 Representation
• Before price bid opening a representation was received from M/s Accenture Solution Pvt. Ltd. with regard to
the scoring done during the evaluation of offers. They have disputed the scores allotted to M/s Tech Mahindra
Ltd. The representation was examined by the technical department and the price bid was opened
subsequently.

• Shri Sudhir Kumar, IEM CIL vide an email dated 29.09.2020 has advised as under in respect of the
representation of M/s Accenture Solution Pvt. Ltd.:

Quote
“I am forwarding herewith a representation from M/s Accenture in connection with the subject NIT.
I would request CIL to look into their representation and dispose the issues raised in a conclusive manner
before the tender is processed further.”
Unquote

• The TC noted that, the representation of M/s Accenture Solutions Pvt. Ltd has been examined by the technical
department and all points brought out in their letter have been suitably clarified. Further, the TC noted that
M/s Accenture Solutions Pvt. Ltd is the L1 bidder with highest Net Total Score as per the evaluation
methodology of RFP. Therefore, the issues brought out in the representation does not have any bearing on the
outcome of the tender. Hence, considering the clarifications furnished the TC was of the view that, the tender
may also be processed further and IEMs may be informed accordingly.
 Price Justification
• The TC also compared the net landed price of M/s Accenture Solutions Pvt. Ltd. with the duly approved,
revised estimate submitted by M/s MDI considering the changed scenario and crashed timeline. Detailed
as under:

Prices Quoted with Net landed price with Estimate with GST % variance
Sl GST & NPV (in Rs.) GST (in Rs.) (in Rs.) over
Name
No. estimate

M/s Accenture Solutions Pvt.

1064022756.00 1099170000.00 1323100000.00 -16.91%
1 Ltd.

• It was noted that, M/s Accenture Solutions Pvt. Ltd. is also the L1 bidder with net landed price 16.91%
lower than the updated estimate. The TC during deliberations also observed that the ongoing Pandemic
has impacted the business in India resulting in the bidder’s willingness to work on lower margins, which is
evident in the present offer also.

• TC also noted that as per the DPR dated 15.07.2017 the estimate for implementation of Phase I & Phase II
together was pegged at Rs. 432.68 Crores. Against this the actual incidence of cost for Phase – I (Rs.
270.00 Crores) and Phase – II (Rs. 109.91 Crores) together is Rs. 387.75 crores (Award value is Rs.
379.91 Crores plus Rs. 7.84 Crores towards cost of additional optional Licenses). Hence total prices for
Phase – I and Phase – II is lower by 10.38% than the estimate of DPR.
 Recommendation of Tender Committee
Meeting held on 30/09/2020

• The TC noticed that, M/s Accenture Solutions Pvt. Ltd. has scored highest net total score and as per the
provisions of the RFP is the successful bidder.

• To consider the offer submitted by M/s Accenture Solutions Pvt. Ltd. as acceptable and conclude contact
with them
 Submission to the Board

The Board of Directors of CIL may kindly consider and approve the above proposal as per recommendations
of the Tender Committee as brought out in the agenda note for placement of order on M/s Accenture
Solutions Pvt. Ltd. for Implementation of SAP ERP at the six subsidiaries of CIL i.e. BCCL, CCL, CMPDI, ECL,
NCL and SECL for a total landed value of Rs 109,91,70,000.00 (Rupees One Hundred Nine Crores Ninety
One Lakh and Seventy Thousand only).
THANK YOU