~ttc..t...wop.(c)no. 7704 of 2009 al'iestt:o!i.':/c.. page 4 of 6 henceforth. "8. a...
TRANSCRIPT
~ t4dbL ~ttc..t-.--(Santosh Mittal)
Dy. Director Railway Stores (G)IRailway Board
GOVERNMENT OF INDIAMINISTRY OF RAILWAYS
(RAILWAY BOARD)
No.95/RS(G)/363/1 New Dellhi, dated 13.7.2011
The General Manager, All Indian Railways & PUs including NF(C).The General Manager, CORE, Allahabad.The General Manager, Metro Railway, Kolkata.The Director General, RDSO, Lucknow & Railway Staff College, Vadodara.The MD, RITES, RITES Bhavan, Sector-29, Gurgaon.The MD, KRCL, Belapur Bhavan, 4th Floor, Sector-11, CBD, Belapur, Navi Mumbai.The MD, MRVC, 2nd Floor, Church Gate station Building, Mumbai.The MD, CRIS, Chanakyapuri, New Delhi.CAOlWorkshop Projects organisation, 1st Floor, Chamber Bhawan, J.C. Road, Patna -800001.CAOIDMW, Patiala and COFMOW, New Delhi.CAO/MTP, NBCC Place, Bhishma Pitamah Marg, Pragati Vihar, New Delhi.CAO/MTP, Mumbai and Chennai.
Subject: Price Preference to SSI etc.
Ref: Railway Board's letter No. 95/RS(G)/363/1 dated 1.6.2011.
In light of recent court decision on Price Preference to SSls, Railwayshave already been advised the essence of various letters of Railway Board on pricepreference to NSIC/KVICIWDC firms vide letter dated 1.6.2011 referred to above. Inthis regard, a copy of the order of Hon'ble High Court of Delhi is enclosed for yourinformation & necessary action. The same is also available on Railway websitewww.indianrailways.gov.in
DA: As above
No: 95/RS(G)/363/1 New Delhi, dated: 13.7.2011
Copy to:
1. FA&CAOs, All Indian Railways & Production Units.
<~1<-tti'i1·- k;.~j)...,r--
(Santosh Mittal)Dy. Director Railway Stores (G)I
Railway Board
2. PCEs, All Indian Railways & Production Units.3. The ADAI(Railways), New Delhi (with 10 spares copies)4. The Director of Audit, All Indian Railways.
~ 1A.:-Ter\t, k~~;:ltSantosh Mittal)
Dy. Director Railway Stores (G)IRailway Board
No: 95/RS(G)/363/1 New Delhi, dated: 13.7.2011
Copy to:
1. The COSs, All Indian Railways & PUs including NF(C).
2. The COS, Metro Railway, Kolkata.3. The COS, COFMOW, New Delhi.4. The COS, CORE, Allahabad.5. The COS, Konkan Railway Corporation Ltd., Belapur Bhavan, 4th Floor, Sector-11, CBD,
Belapur, Navi Mumbai-400614.6. The COS, Mumbai Rail Vikas Corporation, 2nd Floor, Church Gate station Building,
Mumbai-400020.7. The Directors-
a. Indian Railway Institute of Sig. Engg. & Telecom, Secunderabad.b. Indian Railway Institute of Mech. & Elec. Engg., Jamalpur.c. Indian Railway Institute of Elect. Engg., Nasik.d. Sr.Prof. (Material Management), Railway Staff College, Vadodara.e. Indian Railway Institute of Civil Engg., Pune.f. Indian Railway Institute of Logistics & Materials Management. IDA House, Sector IV,
R.K.Puram, New Delhig. Indian Railway Institute of Traffic Management, Lucknow
8. Chairman, Railway Rates Tribunal, Chennai.9. Director, Iron & Steel, 3, Koila Ghat Street, Kolkata.10. Executive Director (Stores), RDSO, Manak Nagar, Lucknow.11. Chief Commissioner, Railway Safety, Lucknow.12. ED(QA)/RITES, RITES Bhavan, Sector-29, Gurgaon, Haryana.13. CPM, CRIS, Chanakya Puri, New Delhi.14. GM(Proj)-V, CRIS, Chanakya Puri, New Delhi.15. Dy.CMM / Workshop Projects organisation, 1st Floor, Chamber Bhawan, J.C. Road,
Patna -800001.16. Zonal Railway Training Institute, Sukuadia Circle, Udaipuf-313004.
No: 95/RS(G)/363/1 New Delhi, dated 13.7.2011
Copy to:
1. The General Secretary, AIRF, 4 State Entry Road, New Delhi.
2. The General Secretary, NFIR, 3 Chelmsford Road, New Delhi.
3. The Secretary General, IRPOF, Room No. 268, Rail Bhavan, New Delhi
4. The Secretary General, FROA, Room No. 256-0, Rail Bhavan, New Delhi.
5. The Secretary General, AIRPFA, Room No. 256-0, Rail Bhavan, New Delhi
Copy to:- Sr. PPSs / PPS / PS to
(i) CRB, FC, ME, ML, MM, MS, MT, SECY., DG (RHS), DG (RPF)
(ii) All AMs and Advisors of Railway Board.
(iii) All Executive Directors of Railway Board.
(iv) All Directors of Electrical, Engineering, Finance, Mechanical, Stores, Signal &Telecom Dte. &
All Branches of Electrical, Engineering, Finance, Mechanical, Stores, Signal &Telecom Dte.
OItHER12.()8.2010
$-* IN THE HIGH COUHT OF DF:LHI AT NEW !H~LHl
41.
+ W.IUC) No. 7704 of 2009
DELKON TEXTILES PRIV ATE LTD..H. PetitionerThrough: Ms. Puja Anand, Advocate.
versus
CORAM: JUSTICE S. MURALIDHAR
"fheVetiti~n~f~e~ksadJrCbtl()n to the Respondent, Ministry 6fRailwa~$,
GOVG1111nelltbfIO'arft't6lrripIemChfand grant the benefits to small ~dlldnJllts.' .', .. . . "
l'SStJs')like.·thc·pefitfonot in terms of Circular dated 28111
August :W()O
>IS$Ll.cd ·J1yt}jc'Mill.i~1!'Y .of .Small Scale !ndustrics & Agro and Rural,._' ', .. ' '0 .i ,""-',' .-',' '. "
lhdtistrics,<h'>vctrittlchfoflnciia Respondent No.2 herein.
2.·lhePc{itidti~rls~SinaHScalc Industrial Unit (' SSU') registered with the
'National Sma:lIStale'Industfles Corporation Ltd. cNSSrCL '), whLch is a
Govenil11ent6flhmaetiterprise, for participation in the Central Government
Petitioner manufactures textile products including fire retardant curtain
fabric, which conforms to the specification or the Research Designs &
Standards Organisation ('RDSO'), functioning under the Ministry orW.P,(C) No. 7704 DJ2009 ",.,. .'. : <:!(+U') :)A TA I'age 1 of 6
.~ !~;opy
Railways, Respondent No.I:
3. There arc four specific benefits granted by the Circular dated nth August
2000 to SSUs which have been registered with the NSS[Cl under its SPRS
in order-to help them in marketing their products:
"1. ISStlcofTender set free of cost.
2. Exempti<')11frpnl payment of Earnest Money
3, Waiver.of Security Deposit to the Monetary Limit ror, "
whiththeuhitis.registered.
4. Prise Prefere'nce upto 15% over the quotation or large-
t:frcl.1il~lliJtS~l:r'st?t.esthat the abovcl11cntioned facilities are given "as
thefin~tJclal resourcesa» the disposal of small scale units arc limitedarrdi!
be.comesdiff1Gultforlhem tiJpartic1pate in'11101't~ than one tender.floated by
~l!lleGirdufar reminds the Government and their departments or earlier
Chcularsdated 30th Julv 1993 and i5!hMav J 998 extending facilirit'st.(). the. ._.,. '_'" ", J - . - " . . ~ '. .
SS(Js whioh WereI'lofbeingirnpJementedo
6, The everltsthatlcd to the Petitioner approaching this Court with the above
prayer is thatRcspqrtcl~nt No.! invited tenders on 11'11 February 2008 for
Fire Retardant Curtain Cloth Fabric for 2 AC and 3 AC coaches as per the
RDSO specifications. On 4th March 2008, a letter inviting quotations for the
above tender was issued by Respondent No.I to the Petitioner The
l/,/,P.(C}No. 770401 Z009 OIGITALI.. Y SiGNED DATA.
(l L,-ArrESTEf)
." "- //.~, t{ •
Page:} of 6
w.p.{eJ Nil. 770~ of 200!i . ATTESYED foge 3 0/6
•• r_" _ •• eF. _...=;:,:======::::::::~~~==
Petitioner submitted its offer (;}] 14tl'Marcll 20(lg
keeping in mind the: market rates prevalent and the hest price possible which
would make the tender viable for them. Among the (our units that
submitted their offers pursuant to the tender. the Pctirioncr wa ..., the 0111y
the Respondent No.2 asking them to direct the lL:'spcndi:l1t1'-h I to gran!
2000. The NSSICL, in tllrn,\vrot~ to tht Respondent No.! on 18;{1i\prH
2008. an :WthMay 260g,T<:~sp,jnden! No, I wrote a Idler of counter-offer In
thy ]>etitiOI}crwithollt extending the benefit under rhc Circular (lined zs"Aug\.lst2(}Ooo'.<thePctitibfic(thcn again wrote to the NSSI Cl. on 2fhM ay
Further letters wetc\vfitten by the Petitioner and the NSSIClo to the
RespondenfN'b.{ 6t1h',hJuI1e 2008 and7ih July 20(H; respectively
70 The petitioner does riot, in his petition. challenge the denial !.C, it or the
iiv-tard ol../i'1.l\>)f p')J'tiql1 ofth~ ter~d~rfloated.by lhcRcs;Xlndcnt No, I Railwuys. . .'-', . ,'.- '.' "', .',' . -. - ..
. tenders, the Railways may not follow the above Circular dated ~sth August.?~' ,
i~~~OO' Accordingly, the only prayer in the writ petit/oil is as under:
:\JItr~ ;::~.;:.\.~ * "to issue a writ of mandamus to the Respondent No.1
~~oa\tI • commanding and directing them to implement and grant all
ihc 'benefits of Purchase Price Preference policy oCthc
main Circular dated 28'h August 2000 in favour or the
Petitioner, which is NS[C approved small scale unit
WoP.(C)No. 7704 of 2009 Al'iEstt:O! I.' :/c..
Page 4 of 6
henceforth. "
8. A counter affidavit and a supplementary affidavit have been filed by the
Railways on 12th November 2009 and 29th July 20 10 respectively, Since the
first counter affidavit did not specifically deal with the CircuiHr dated nth
August 2000, this Court required the Respondent 10 file a supplCl11'cntary
affidaviL As fat as the tendertloated on lih February 2008, i1 is stated that
the offers were receivecHrbm 5 units, 'iI1?hldlng the Petitioner, The Petitioner
"vas the orily SSU. 'rhe Petitioner and one M/s. Anudc Faze Autd Fab Ltd.
('AFAFL/) were categorized a.s'RDSOPart Il sources' /\ bulk oi'der was
submitted fhatthc'lOwcsl Offctrcc:eivcd was from i\FAFL,whi,ch is not a. .,'," ',' -' "','- -',',' ",' '"
SStJ,at Rs.26$pC,rrrtcter plustheexclse duty @ Rs. 2 L84 Le, all inClusive
rate .()fRs.286.84pcrli1et~r. 15% of the quantity was awarded ro I\FI\FL. . . '. .
rll'eofferbrthc.iPQ~iti()ir~twa~ Rs.3tl per iWetcr. llowcvcr, it is stated in
"(x) 'Vhatas per pllrehasc/pricc preference clause, the
purch;:\s(fl' r~~erves the option to give the price preference to
the small scale ind\lstricsovcr those from other firms,
However it .cann6l be taken for granted, and every need he
luadeby them to bring down the cost and, achieve
competitiveness. However the Petitioner has been given the
benefits of waiver of cost of tender document and exempted
from paymcntofEMD,
XXXX
otGTT~\..L'lS\GltEO OA.i,. xxxx
'li-9,\f.irr~ri<coo~ (xiv) 11"t by the above facts, it is very cloar that thet~ I discounted rate offered by the firm which is affordable will
be the best price and profltahle to them, hut claiming higher'
W.P.(C) No. 7704 of 2009
page.) of 6
---_.-._--.,-----,--_.. _-,: ..-.--.,.-.~~ ..-.,,~---.-~--
price under the provision of benefit or price prcCerence up to
15% over the large scale units is not proper and rn islcading
the .Governmcnt."
9. Learned counsel for the Petitioner points out that the Petitioner being the
only SSU was entitl(i)d to be considered since its offer of Rs. 32 \ per meter
was less than the lowest offer of Rs. 286.84 plus I 5 (Y() in terms of the
Cjrcular <jatcd 2Sth August 2000. Learned counsel for the Petitioner,
howeVer, reiterateS that the Petitioner is not secking. any dircct\(')I1S \vith
rerer
€mge to the aw~rd of contract pursuant to the tender floated by the
j Rail\\-''<olYs on l2thpebrllary 2008 but would be satisfied if a clariflbationis
iSSt1e<lfQ~~I:i,e.~turi,':i~lJOtlttheappnQahility of the Circular dated 28111
August
2QOO"
10. Learned couns.~l f9r the Respondents, while not denying that the rate
qQ6tcdbyt~~P"Gtiti<?!1~r ,could be well within the acceptable qU()tapol1 or. . . ....•..... . : .. , " ..
15%Clverth~qilqt~fipt1 offered by AFAFL, submitted that it waslri
the. ...' ..:.' "'- '; -~':;:. -'. . ::."-,:'!..
discretioo.ofthe.Rallways whether or not to extend the bcnditin terms 0t
theCirculardatea 2Sth August 2000.: - .:,' .
February 2008, As regards the only prayer in the writ petition; it appears to
this Court that the Railways do not have any di fficulty as rcg.ard~cxtending
three of the lOUr benetlts extended·to SSlJs by the Circular dated zs" August
20000 However, in granting the price preference "lIPlO 15°lcl over the
.~ ef Jarge-1lcale ;i.UUts" ahere l'P.Pcars 10 .be ;j misconstruing {)J the
Gm!lar ~:zgth .August 2000 by !the'l\1inistryofRaitw:ays_ Whika SSU
cannot .insist that the entire quantity tendered must be offered loan SSU, :a
duly Bualified SSU should be givenpreference in the matter ofprice In-terms
of'zbeCircnlar a~ed 2:8lilAugust 20.0.0. In other words.vwherethebid ofa
non-'SSU large scale ·UIrit Iravebeenaccepted for a portion of the tendered
qlJantity.ih.en me ,qualified ·ShaUbe ,quaJified up to 15%aoove ro price
quoted 'by',the Iarge-scale ,unit. Betweentwo :SSUs,.ofco~e, ii1would 'be
for the RaTIways ;to opt for...~e 'bener piice -quoted, which-again cannot
exceed 15% .over Md abovi·~.~Ox •..est price .quoted by the l~sca1cJJnit.
Itis1iufher.e1acifiedthatitiisnotnecessarythatiheentirequar.tt'ity:Shoclrlbe. . -:" . ..~I
'xiff~d to 'R SSUI If 1h.eCire.clar ..dated 281h Augusr 2000 is read as beUlg. ~ - . . . . .
purely discretionary, ;then the {i~e.c.t:so~ 10 be achieved by 'SUCh C:rr~u1ar
fer ;natex:tending to ,duly .q~ SSIiJ::the~e:fit'!iDder the C'm:m:1arilaterl
.2:811I~ 2000, ,Wbich reasons _ ;b::' ;r,~td~dJn~ritIng, 5tlch :a
;qualified 'SW :Sho.u1dbe,extended ;allthehere.fi:ts, mdu~ pri.ce reference
(J;f 1.5"4>,o:verthe price BUQted~thequalified Iarge-scale unit w ,tenns of,the
. C.rrcu'lardated 2StB August: 200£tJIheRaihwl,Yi> :sha1l implement ti:le:Said
~,&re.d ~Auwst2-oo.e ~e ewuafil'lgthelbiids,su1m:iitted!by 1thi-
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