Rule 219 - Disposal of Goods | KartavyaDesk
Original Rule Text
transparency, competition, fairness and elimination of discretion. Wide publicity should be ensured of the sale plan and the goods to be sold. All the required terms and conditions of sale are to be incorporated in the bidding document comprehensively in plain and simple language. Applicability of taxes, as relevant, should be clearly stated in the document. (b) The bidding document should also indicate the location and present condition of the goods to be sold so that the bidders can inspect the goods before bidding. (c) The bidders should be asked to furnish bid security along with their bids. The amount of bid security should ordinarily be ten per cent. of the assessed or reserved price of the goods. The exact bid security amount should be indicated in the bidding document. (d) The bid of the highest acceptable responsive bidder should normally be accepted. However, if the price offered by that bidder is not acceptable, negotiation may be held only with that bidder. In case such negotiation does not provide the desired result, the reasonable or acceptable price may be counter offered to the next highest responsive bidder(s). (e) In case the total quantity to be disposed of cannot be taken up by the highest acceptable bidder, the remaining quantity may be offered to the next higher bidder(s) at the price offered by the highest
What This Means
Rule 219 of the General Financial Rules (GFR), 2017, focuses on how government departments should sell off old or surplus goods. The core principle is to ensure the process is transparent, fair, and competitive, preventing any biased decision-making. This rule applies whenever a government entity decides to dispose of assets, ranging from old office equipment to scrap materials. It directly affects government employees involved in the disposal process, bidders interested in purchasing the goods, and ultimately, the public by ensuring efficient use of government resources.
The rule emphasizes clear communication and detailed documentation. Before the sale, the department must widely publicize the sale plan and the items for sale. The bidding documents must be comprehensive, using simple language to explain all terms and conditions, including applicable taxes. Potential bidders should also be able to inspect the goods beforehand. Finally, the rule outlines the process for accepting bids and negotiating prices, prioritizing the highest acceptable bid while allowing for negotiation under specific circumstances.
In essence, Rule 219 aims to maximize the revenue generated from the sale of government assets while maintaining integrity and accountability. By following these guidelines, government departments can ensure they are getting the best possible value for the items being sold and that the process is open and fair to all participants.
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Key Points
- •Transparency and fairness are paramount in the disposal of government goods.
- •Bidding documents must be comprehensive, clear, and include all relevant terms and conditions, including taxes and inspection details.
- •Bid security (typically 10% of the assessed value) is required from bidders.
- •The highest acceptable responsive bid should normally be accepted, with negotiation allowed only with that bidder initially.
- •Remaining quantities can be offered to the next highest bidder(s) at the price offered by the highest bidder if the highest bidder cannot take the entire quantity.
Practical Example
The Department of Agriculture decides to dispose of 50 outdated tractors. Following Rule 219, they publish a detailed advertisement on their website and in local newspapers, outlining the specifications of the tractors, their location, and the terms of the sale. The bidding document clearly states that a bid security of 10% of the reserve price (Rs. 50,000 per tractor, so Rs. 5,000 per tractor as bid security) is required.
Three bidders participate. Mr. Sharma offers the highest bid of Rs. 60,000 per tractor. However, he only wants to purchase 30 tractors. The department, following Rule 219(e), offers the remaining 20 tractors to the next highest bidder, Ms. Verma, at Rs. 60,000 per tractor. Ms. Verma accepts the offer, and the disposal is completed transparently and efficiently.
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 the highest bid is significantly lower than the assessed value?▼
Is it mandatory to accept the highest bid?▼
What constitutes a 'responsive' bidder?▼
Can the bid security be forfeited?▼
Does Rule 219 apply to all types of government assets?▼
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 Rule 219 of the GFR, 2017, what is the primary objective when disposing of government goods?
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