Para 4.17.2 — GOODS_MANUAL

4.17.2 Mandatory Procurement of Goods and Services through Government emarketplace (GeM) (Rule 149 of GFR 2017) 1. An online marketplace (or e-commerce marketplace) is a type of e-commerce site where several sellers offer products or services, and all the buyers can select the product/ services offered by any one of the sellers based on his own criteria. In an online marketplace, Purchaser’s transactions are processed by the marketplace operator, and then products/ services are delivered and fulfilled directly by the participating retailers. Other capabilities might include auctioning (forward or reverse), catalogues, ordering, posting requirements by purchasers, payment gateways, etc. In general, because online marketplaces aggregate products from a wide array of providers, selection is usually wider, availability is higher, and prices are more competitive than in vendor-specific online retail stores.

2. The Government of India has established the Government e-Marketplace (GeM) for common-use Goods and Services. The procurement process on GeM is end-to-end, from placement of contract orders to payment to suppliers. This is to ensure better transparency and higher efficiency. All the processes will be electronic and online. The Procurement of Goods and Services through the GeM portal by Ministries/ Departments (including attached/ subordinate offices), CPSEs, and autonomous bodies is mandatory for Goods or Services available therein as per Rule 149 of GFR, 2017. 3. Products and services are listed on GeM by various suppliers, as on other e-commerce portals. Supplier registration on GeM is online and automatic based on PAN Card, Aadhaar Card, GST Certification, Bank Account and Financial Information, Corporate Registration Documents (Udyam registration for MSEs), VAT or TIN Number, Proof of Address, Contact Details, etc. Suppliers offer their products on GeM, and government buyers can view and compare all the products. 4. Demand Aggregation: The best prices for a user can be available if the same requirements and demands of various organizations are aggregated. This acts as an incentive for the supplier to quote their best price. For the same products, the demand of various government departments can be clubbed together, and reverse auction can be done based on aggregate demand, which will provide the best prices to the government. Department. 5. Authority of procurement through GeM: Procurement through GeM has been authorised as per GFR, 2017 Rule 149: - 6. “Government e-Market Place (GeM): GeM SPV (Special Purpose Vehicle) will ensure adequate publicity, including periodic advertisement of the items to be procured through GeM for the prospective suppliers. Suppliers' credentials on GeM shall be certified by GeM SPV. The GeM portal shall be utilized by the Government buyers for direct online purchases as follows:- a) Up to Rs.50,000/- through any of the available suppliers on the GeM, meeting the requisite quality, specification, and delivery period.

Note 1: In the case of automobiles, direct procurement under this sub-para is permitted without any ceiling limit.

Note 2: In case the item is available on GeM, it is not permitted to purchase the same under Rule 154 of the GFR, 2017. b) Above Rs.50,000/- and up to Rs.10,00,000/- through the GeM Seller having the lowest price amongst the available sellers, of at least three different manufacturers, on GeM, meeting the requisite quality, specification, and delivery period. The tools for online bidding and online reverse auction available on GeM can be used by the Buyer even for procurements less than Rs. 10,00,000/-.

Note 1: In case the item is available on GeM, it is not permitted to purchase the same under Rule 155 of the GFR, 2017. c) Above Rs. 10,00,000/- through the supplier having the lowest price meeting the requisite quality, specification, and delivery period after mandatorily obtaining bids, using online bidding or reverse auction tool provided on GeM. d) The invitation for the online e-bidding/reverse auction will be available to all the existing Sellers or other Sellers registered on the portal and who have offered their goods/services under the particular product/service category, as per the terms and conditions of GeM. e) The above-mentioned monetary ceiling is applicable only for purchases made through GeM. For purchases, if any, outside GeM, relevant GFR Rules shall apply. f) The Ministries/Departments shall work out their procurement requirements of Goods and Services on either “OPEX” model or “CAPEX” model as per their requirement/suitability at the time of preparation of Budget Estimates (BE) and shall

Chapter 4: Modes of Procurement and Tendering Systems project their Annual Procurement Plan of goods and services on GeM portal within 30 (thirty) days of Budget approval. g) It may be noted that it is the responsibility of the Procuring Entity to do due diligence to ensure the reasonableness of rates. The government buyers may ascertain the reasonableness of prices before placing an order using the Business Analytics (BA) tools available on GeM, including the last purchase price on GeM, the department’s own last purchase price, etc. h) Demand for goods shall not be divided into small quantities to make piecemeal purchases to avoid procurement through L-1 Buying / bidding / reverse auction on GeM or the necessity of obtaining the sanction of higher authorities required with reference to the estimated value of the total demand.”

7. GeM Portal: https://gem.gov.in. Detailed instructions for user organization registration, supplier registration, listing of products, terms and conditions, online bidding, reverse auction, demand aggregation, call centre, etc., are available on this portal. 8. Uploading of Non-availability Report: It is mandatory for a buyer to generate a “GeM Availability Report and Past Transaction Summary” (GeMAR&PTS)80 with a unique ID on the GeM portal using his login credentials on GeM for procurement outside GeM (for example, for procurement through Central Public Procurement Portal). The Past Transaction Summary will be provided, where available. “GeMAR&PTS” shall be a prerequisite for arriving at a decision by the competent authority for procurement of required goods and services by floating a bid outside GeM, and its unique ID would be required to be furnished on the publishing portal along with the tender proposed to be published. 9. Purchase of goods without quotation can be resorted for value upto Rs. 50,000/- only on each occasion may be made without inviting quotations or bids (please refer to para 4.11) based on a certificate to be recorded by the competent authority, only when the required goods are not available on GeM. 10. In case a certain item is not available on the GeM portal, Purchase of goods costing above [Rs.50,000/- (Rupees Fifty thousand only) and upto Rs.5,00,000/- (Rupees Five lakh] on each occasion may be made on the recommendations of a duly constituted Local Purchase Committee (please refer to para 4.12). 11. Where an item is available on GeM, and the Ministry/ Department/ Organization wants to buy outside the GeM in view of any compelling circumstances, the approval of the Standing Committee of GeM (SCoGeM) and the Secretary concerned shall be required. 81 12. Receipt of Materials and Payment Procedures: Further Details on receipt of Materials and Payment procedures are given in Annexure 36. 13. Push Button Procurement on GeM82 a) As per Rule 144

(vii) and Rule 149 of GFR, 2017, the procuring entity should satisfy itself that the price of the selected offer is reasonable. Sometimes, especially infrequently, government buyers find it difficult to certify the reasonableness of rates. Such users normally do not possess the requisite skills to make procurement decisions. It delays the procurement process. At the same time, for typically low-value procurements, efforts expended in assessing the reasonability of rates may be disproportionate. Additionally, with developments in technology and e-procurement becoming the norm, the availability of market activities and the capability to analyse them artificially have provided an opportunity to automate decision-making activities, such as the assessment of the reasonability of rates in such cases.

b) In view of the above, GeM offers the functionality of Push Button Procurement (PBP) for small-value procurements with the following conditions:

i) PBP will be made only on GeM through bidding (PBP through Direct Purchase, L1, Custom-bid, etc. are not permitted) ii) The total procurement value of the specific case is permitted upto Rupees Five (5) lakh83, inclusive of all taxes. iii) This will be an additional method of procurement, and procuring entities are free to use or not to use this additional method of procurement. iv) This method can be used only if at least five bids are received. In case fewer than five bids are received, the procurement is to restart using the usual procurement modes. However, buyers will have a choice to extend the PBP date once by three (3) days at the time of preparation of the tender document in case of lesser participation. v) No splitting of requirements is to be done to bring procurement under this method. vi) Once a bid is invited on GeM, the contract will be placed directly by GeM without any human intervention. [Provided condition in sub-para iv) above is complied]. vii) Gem will permit this method only for such categories where at least ten sources are listed. c) GeM has published a manual on PBP for buyers on its website84.