Para 3.8 - Debarred Firms | KartavyaDesk
Original Rule Text
b) No contract of any kind whatsoever shall be placed with a debarred firm, including its allied firms, after the issue of a debarment order by the entities in the jurisdiction mentioned in the order. Bids from only such firms shall be considered for placement of contract, which are neither debarred on the date of opening of tender (opening of first bid, normally called as technical bid, in case of two packet/two stage tendering) nor debarred on the date of contract (i.e., date of issue of Letter of Acceptance). Even in the cases of risk purchase, no contract should be placed on such debarred firms. c) If any debarred firm submits the bid, it will be ignored. In case such firm is lowest (L1), the next lowest firm shall be considered as L-1. Bid security submitted by such debarred firms shall be returned to them. d) Contracts concluded before the issue of the debarment order shall not be affected by the debarment Orders. e) The Debarment shall be automatically extended to all its allied firms. In case a joint venture/ consortium is debarred, all partners will also stand debarred for the period specified in the Debarment Order. The names of partners should be clearly specified in the “Debarment Order.” f) Debarment in any manner does not impact any other contractual or other legal rights of the procuring entities. g) The period of debarment shall start from the date of issue of the debarment order for the issuing entity. In respect of procuring entities other than the one that has carried out the debarment, the debarment takes effect prospectively from the date of uploading on the website(s) in such a manner that ongoing procurements are not disrupted. h) Ordinarily, the period of debarment should not be less than six months. i) GeM portal also has a provision for Suspension (debarring vendors/ service providers participation in procurements of all the buyers) under its Incidence Management Policy38. The reasons and period for suspension are different than in the provisions mentioned above. However, if a procuring entity feels that the period of suspension by GeM is not adequate, it may also debar the firm as per procedure mentioned in this section for a more appropriate period, but such debarment shall be applicable ONLY to procurements by that procuring entity. j) All Ministries/ Departments must align their existing Debarment Guidelines in conformity with these Guidelines. Further, bidding documents must also be suitably amended, if required.
What This Means
Para 3.8 of the Manual for Procurement of Consultancy Services deals with the debarment of firms. Simply put, if a company is 'debarred,' it's temporarily banned from getting government contracts. This rule ensures that if a firm has been found to be unreliable or has engaged in misconduct, it can't continue to receive public funds through consultancy contracts. The debarment applies to the firm itself, its associated companies, and any partners in a joint venture or consortium.
This rule is crucial for maintaining integrity and fairness in government procurement. It applies from the moment a debarment order is issued and is usually effective for at least six months. It affects all government departments and ministries involved in procuring consultancy services. The rule also clarifies that existing contracts aren't affected by a new debarment order, and that debarment doesn't impact other legal rights of the government. The GeM portal's suspension policy is also considered, allowing procuring entities to impose longer debarment periods if needed, specific to their own procurements.
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Key Points
- •Debarred firms and their allied entities are ineligible for government consultancy contracts.
- •Debarment is effective from the date of the order (for the issuing entity) and prospectively from the date of website upload (for other entities).
- •The minimum debarment period is generally six months.
- •Debarment extends to allied firms and all partners in a debarred joint venture/consortium.
- •Existing contracts are not affected by a debarment order.
Practical Example
The Ministry of Skill Development and Entrepreneurship issued a debarment order against 'ConsultCorp' due to fraudulent billing practices. According to Para 3.8, ConsultCorp, along with its subsidiary 'SkillSolutions,' is now ineligible for any new consultancy contracts with the government. If ConsultCorp submits a bid for a new project worth ₹50 lakhs, the bid will be ignored, and their bid security will be returned. If 'GlobalTech' was the next lowest bidder, they will be considered L-1. However, a contract ConsultCorp signed with the Ministry last year, before the debarment, remains valid.
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Frequently Asked Questions
What happens if a debarred firm submits a bid?▼
Does debarment affect existing contracts?▼
How long does a debarment typically last?▼
If a joint venture is debarred, does it affect all partners?▼
Can a procuring entity impose a longer debarment period than GeM?▼
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Test Your Knowledge
Question 1 of 3
According to Para 3.8 of the Manual for Procurement of Consultancy Services, what is the minimum period for which a firm should ordinarily be debarred?
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