MSOP - Model Schedule Of Powers - Part A - Works Matters - Notes by Shri Chandra Sekhar M

 

Click for MSOP - Part A - Works Matters

Video Lesson on Operating Ratio

Counter Offer

Counter Offer

(Most important short notes question for General expenditure paper)

In simple  terms

·         'A' makes an offer to sell his car to 'B' at a price of Rs.3 lakhs.  B gives acceptance conditionally saying that he wants to purchase that car at Rs.2.5 lakhs.  This conditional acceptance is not valid, hence there is no contract.  This is nothing but, B's counter offer to A.

·         That means conditional  acceptance or partial acceptance is none other than called as Counter Offer.

In Railways

·          In cases where the overall value of L-1 is reasonably good, but the rates(s) for certain item(s) in a schedule happen to be higher than those quoted by other tenderers in the same tender or higher than the last accepted rates,

·          the method of counter offering the lower rates(s) obtained in the same tender considered reasonable by Tender Committee may be adopted while finalizing the tender.

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EPC - 2020 year SCR LDCE question for 5 marks

 

EPC

§      EPC stands for Engineering, Procurement & Construction

§      Also known as Turnkey project (Turn of the Key)

§      A new and prominent form of Contract Agreement in Construction industry.

§      Key feature: To execute and deliver the Project (from Planning to Completion in all respects) within Agreed time and Budget.

§      In a nutshell, EPC Contractor will carry out:

A.      Carry out the detailed Engineering Design of the Project.,

B.      Procure all the Equipments and Material for construction of the said Project.,

C.      then, Construct the Project and Deliver to their Client.

§      Usually in EPC Contracts, the Client employs PMC - Project Management Consultant to supervise the work. (Click here to access the article on PMC)

Need of EPC in Indian Railways

§      In Conventional Rate Contracts (present Works Contracts), the usual drawbacks are

A.      Delay in Survey

B.      Delay in preparation of Estimates

C.      Delayed Measurements

D.      Inadequate funds

E.       Cost over runs

F.       Time over runs

G.     Disputes on various issues with Contractors

§      To address all the above issues, Railway Board have proposed a Model EPC Agreement, which is released recently.

§      Click here for Model EPC Agreement

Salient features of Model EPC Agreement of Indian Railways

ü  Lump sum Contract Price (subject to Price Variation clause)

ü  Within Time

ü  Damages due to delay i.e., 0.05 % of Contract Price for one day delay.

ü  Maximum damages are not to exceed 10 % of Contract Price.  That means, maximum delay is 200 days ( 200 x 0.05 = 10)

ü  Assigned responsibility for Investigations, Design & Construction to the EPC Contractor

ü   Transferring the Construction Risk to the EPC Contractor.

ü  Payments are linked to the Specific Stages of Construction. (unlike individual measurements like in existing rate contracts/Works contracts)

ü  Defect Liability Period  - 2 years

ü  Bid Security (Replacing EMD )

ü  Performance Security ( May be replacing Security Deposit and Performance Guarantee)

Examples of EPC in Indian Railways / Transport sector.

1.       RE - Railway Electrification Project - 781 Kms in Konkan Railway given to L & T in the year 2017.

2.       Delhi Metro Railway Construction

3.       Construction of Railway Bridge in Jammu - Udhampur Railway Link

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Buildings and Rents

 

Buildings & Rents  

Source: Chapter 19 of Engineering Code 

• No employee has any right to be provided with Quarters 

• Quarters provided by Railways - The following circumstances 

1. Where conditions are such that Private enterprise does not adequately meet the demand for housing the staff. 

2. It is necessary for special reasons to provide Quarters for certain staff near to their work (for example: staff working in remote location Railway Stations)  

• GM - Can divide the Quarters into separate classes as per the standard of accommodation approved for various classes of staff. 

• Railway Board - Have the power to prescribe the scale of accommodation and the unit cost of each class of quarters.  

• Motor garages - Should not as a rule be provided in staff quarters. Allowed only in exceptional cases i.e., essential in the interest of the official's work. In such cases, the cost of garages should be added to the capital cost of the quarters to assess the Rent.  

• Temporary Garages - The cost should not exceed Rs.10,000 /-

• Assessed Rent of class of Quarters - 6% of the Capital cost of all the Quarters of the particular class. 

• Rent - Officers Quarters - Floor Area basis 

• Rent - Staff Quarters - Floor Area basis (wherever possible) 

• Rent - Assessed once in 5 years 

• Rent - To work out the details, 2 years is allowed.

• Example: The Rent worked out based on the cost as on 31.03.2021 will be effected from 01.04.2023.  

•  GM/DRM - Have full powers to incur the expenditure on Repairs to the Quarters. (Previously Rs.1 Lakh on Quarter subject to Rs.30 Lakhs per Annum.  Now it is deleted) 

• Leased and Requisitioned Buildings - The rent paid to the Landlord should be treated as Assessed Rent 

• The Total Cost of the Quarters: 

  Inclusions: 

1. The entire cost of construction irrespective of the source of finance 

2. Sanitary fittings

3. Water Supply fittings

4. Electric Installation & Fittings 

Exclusions: 

1. Cost of Land 

2. Development of Land (Raising, Levelling, Dressing, Construction of Revetments, retaining walls, compound walls, fences and gates, Approach Roads, Sewerage, Street lighting, Water supply arrangements, Over Head Tank, Transformer, etc) 

• Electric Bulbs:  First cost from Railway Funds.  Subsequent replacements are chargeable to the Occupants. 

• Provision of other special installations and fittings such as Heating installations, Electric Lifts, Refrigerators, and Furniture  - Railway Board prior permission is required. 

• Hire Charges for Furniture  

• 14% per annum for Durable articles - Beds, Almirahs, Chairs, Tables etc 

 

• 24.75% per annum for Non Durable articles - Door mats, curtains, mattresses, durries (carpets), chicks (stools), etc  

Obligation of Tenants:  

1. Any additions or alterations to quarters with permission of the Executive Engineer in charge only.

2. Keep their Quarters in a clean and wholesome state. 

Service Buildings: 

• Examples: Railway Stations, Offices, Depots, Workshops, Running Rooms, Guest Houses for Officers and subordinate staff 

• No Rent is chargeable 

• Temporary use of Rest houses etc as Residence -  DRM has powers 

• No Rent  - Accommodation provided for the Officers of Government Inspectors of Railways or for Statutory Audit Officers  

List of Buildings: 

 

• Maintaining a complete and up-to-date list of all Buildings 

• Both Residential and Service 

• Form: E 1977 

• Division wise 

• Reviewed by the Divisional Engineer once in every 3 Months  

Rent Rolls:   

• Prepared in Triplicate (Personnel Dept, Accounts Dept and Office Copy)

• Prepared on the beginning of the Financial Year i.e., 1st April 

• Information of Quarters, Occupants, etc 

• Form: Chapter 16-A of the Engineering Code 

Key Points for MCQ: 

1. Buildings & Rents - Chapter 19 of the Engineering Code 

2. No employee has any right to be provided with Quarters 

3.  Assessed Rent of class of Quarters - 6% of the Capital cost of all the Quarters of the particular class. (whether the Total cost is charged to Capital or any other Source of Finance)  

4. Rent - Assessed once in 5 years 

5. Rent - To work out the details, 2 years is allowed.

6. Example: The Rent worked out based on the cost as on 31.03.2021 will be effected from 01.04.2023.  

7. Rent - Officers Quarters - Floor Area basis 

8. Rent - Staff Quarters - Floor Area basis (wherever possible) 

9. GM/DRM - Have full powers to incur the expenditure on Repairs to the Quarters. 

10.  Temporary Garages - The cost should not exceed Rs.10,000 /- 

11.  Electric Bulbs:  First cost from Railway Funds.  Subsequent replacements are chargeable to the Occupants.  

12. Hire Charges: 14% per annum for Durable articles - Beds, Almirahs, Chairs, Tables etc  

13. Hire Charges: 24.75% per annum for Non Durable articles - Door mats, curtains, mattresses, durries (carpets), chicks (stools), etc  

14. Rent is not chargeable to Service Buildings like Stations, Offices, Workshops etc 

15. Temporary use of Rest houses etc as Residence -  DRM has powers 

16. No Rent  - Accommodation provided for the Officers of Government Inspectors of Railways or for Statutory Audit Officers  

17. Form: E 1977 - List of Buildings 

18. List of Buildings - Reviewed every 3 months. 

19.  Rent Rolls - Prepared in Triplicate (Personnel Dept, Accounts Dept and Office Copy) 

20. Rent Rolls - Prepared at the beginning of the Financial Year i.e., 1st April 

End

Engineering Code - Latest 2023 May

 

Engineering Code

1. Revised Edition 1982 

2. Fourth Re-Print 2012 

3. Up to ACS 61 May 2023  

4. PDF copy by IRICEN, Pune  

Click for Engineering Code Latest 2023 May

Key to Expenditure Question Paper Appendix2 Exam 2023 WR

 

Key to Expenditure Question Paper Appendix2 Exam 2023 WR 

Click for Expenditure Question Paper 2023 of WR   

Section I

1.  Match the following:   (Marks 12 x 1=12) 

1	EPC		A	Registration of Bills
2	Plan Head 53		B	Traffic Facilities
3	CO 6		C	General Conditions of Contract
4	Cash Imprest		D	Engineering Procurement Construction
5	Primary Unit		E	Works chargeable to Capital
6	GeM		F	% of Gross Working Expenses to Gross Earnings
7	Plan Head 16		G	Government e Marketplace
8	GCC		H	Works Matters
9	ROR		I	Object of Expenditure
10	Operating Ratio		J	Petty Expenses
11	MSOP Part A		K	Control Over Cash Outgo
12	Exchequer Control		L	Customer Amenities

Answer: 

1	EPC		D	Engineering Procurement Construction
2	Plan Head 53		L	Customer Amenities
3	CO 6		A	Registration of Bills
4	Cash Imprest		J	Petty Expenses
5	Primary Unit		I	Object of Expenditure
6	GeM		G	Government e Marketplace
7	Plan Head 16		B	Traffic Facilities
8	GCC		C	General Conditions of Contract
9	ROR		E	Works chargeable to Capital
10	Operating Ratio		F	% of Gross Working Expenses to Gross Earnings
11	MSOP Part A		H	Works Matters
12	Exchequer Control		K	Control Over Cash Outgo

2. Fill in the Blanks      (16 Marks) 

1. Detailed estimates need not be prepared for works costing less than _______ 

2. Expenditure of Railway Staff College is chargeable to Demand No._________ 

3. Currency for the sanction to an Estimate is normally  _____ years 

4. Minimum Rate of Return expected for Railway Projects is _____ percent 

5. The Amount recoverable from Suppliers for the failure to supply the materials within due date is known as __________ 

6. Salary of Running Staff is booked to Demand No. ____ 

7. The Zonal Accounts Department is headed by ______ 

8. Abstract Z refers to ____________ Earnings   

Answers: 

1. Rs 5 Lakhs 

2. Erstwhile Demand No. 2 Miscellaneous Expenditure - General (Railway Staff College new name is NAIR - National Academy of Indian Railways)  .  If Zonal Training Centres, the answer is erstwhile Demand No.12 - Miscellaneous Working Expenses (SMH - Sub Major Head 10)

3. 5 years  ( 2 years - If work is not commenced)  

4. 10 

5. LD - Liquidated Damages 

6. Erstwhile Demand No. 08 - Operating Expenses - Rolling Stock & Equipment 

7. PFA - Principal Finance Advisor (In Railway Board - Member Finance.  In Division - Sr.DFM - Senior Divisional Finance Manager)

8. Sundry Other Revenue (Now Revenue is replaced the word Earnings)  .Abstract X - Coaching Traffic Revenue and Abstract Y - Goods Traffic Revenue

3. State Whether True or False:       (12 Marks)

SN	Statement	True / False
1	The object of performance guarantee in service tenders is to keep the offer of open till the finalization of Tenders
2	Revenue Allocation Register is maintained for exchequer control
3	PVC claim is applicable for Contracts above Rs.25 Lakhs
4	Expenditure on ceremonial occasion is normally charged to Revenue
5	Post Project appraisal is done through Productivity Test
6	In IPAS module bills are required to be pass at 3 levels
7	The checks exercised by Railway Accounts Office on financial transactions is called Internal Audit
8	M&P programme is budgeted under Plan Head 41
9	Two Packet system of tendering means submitting the Tender documents separately for Technical and financial bids
10	Arbitration is a mechanism to sort out the disputes arising out of implementation of Contract
11	Deposit works means works charged to Fixed Deposit under Contingency Fund of India
12	A Contract under which during the period of its currency, the Contractor engages to supply materials on Demand irrespective of the Quantity at fixed unit rate is called Rate Contract

Answers: 

1. False (Correct Answer is the Object of EMD is to keep the offer open till the finalization of Tender)

2. False 

3. False  (The Correct answer is Rs.2 Crores and above) 

4. True 

5. True

6.  

7. False (The Correct answer is Internal Check) 

8. True 

9. True 

10. True 

11. False 

12. True

4. Give the full forms of following: (Any 18)   (Marks 18 x 1=18) 

SN	Abbreviation/  Acronym	Expansion
1	IPAS	Integrated Payroll Accounting System
2	IRPSM	Indian Railways Projects Sanction & Management
3	GST	Goods & Services Tax
4	MSME	Micro Small & Medium Enterprises
5	RRSK	Rashtriya Rail Sanrakshak Kosh
6	DRF	Depreciation Reserve Fund
7	PVC	Price Variation Clause
8	HRMS	Human Resources Management System
9	DOP	Delegation Of Powers
10	RDSO	Research Designs & Standards Organization
11	CLW	Chittaranjan Locomotive Works
12	RSP	Rolling Stock Programme
13	EMD	Earnest Money Deposit
14	PBG	Performance Bank Guarantee
15	UDM	User Depot Module
16	GFR	General Financial Rules
17	DCF	Discount Cash Flow
18	IRWCMS	Indian Railways Works Contract Management System
19	NPV	Net Present Value
20	GTKM	Gross Tonne Kilo Meters
21	FIRR	Financial Internal Rate of Return

To be Continued…….