Para 1.12 — NONCONSULT_MANUAL

1.13. Legal Aspects Governing Public Procurement of Services A public procurement contract, besides being a commercial transaction, is also a legal transaction. There are a number of laws that may affect various commercial aspects of public procurement contracts. A public procurement professional is expected to be generally aware of the implications of following basic laws affecting procurement of works; however, he or she is not expected to be a legal expert. In different contexts of the scope of work, an additional set of laws may be relevant. (For salient features of laws applicable to public procurement, please refer to Appendix 2 provided in Manual for Procurement of Goods, Second Edition, 2024)

1.14. The Law of Agency – applicable to Procurement of Nonconsultancy services Legally speaking service provider would be an Agent of the Procuring Entity acting as a ‘Principal’ –, to carry out the service on its behalf. Such a relationship is covered by The Law of Agency (Section 182 to section 238, of the Indian Contract Act, 1872) and hence there exists a Principal and Agent relationship between Procuring Entity and the service provider. As per this law, the Procuring Entity is vicariously legally and financially liable for actions of its Agents. For example, a violation of certain labour laws in deputing staff for Procuring Entity’s contract by the service provider may render the Procuring Entity legally and financially answerable for such violations, under certain circumstances. There is a need to be aware of such eventualities. Model tender Documents take care of this aspect.

1.15. Public Procurement Cycle in Procurement of Services The entire process of procurement and implementation of Non-consultancy services shall include the following steps:

1. Services to be procured should be justifiable in accordance with Para 1.11 above; 2. In Non-consultancy Services, Activities Schedule (a document covering well-defined scope of work/ description of services and the time frame for which services are to be availed of) should be consistent with the overall objectives of Procuring Entity; 3. Equal opportunity to all qualified service providers to compete should be ensured; 4. Engagements should be economical and efficient.; 5. Transparency and integrity in the selection process (that is, proposed, awarded, administered, and executed according to highest ethical standards).

1.12. Principles for Public Procurement of NC Services Other principles of Public Procurement as mentioned in para 1.8 above are also equally applicable to Procurement of Non-consultancy services. To ensure value for money during procurement of Non-consultancy services, the following additional principles shall be considered:

1. Need Assessment: a) Preparation of Procurement Proposal (Concept Paper) and obtaining in principle approvals; b) Preparation of the Services and Activities Schedule, cost estimate and seeking administrative and budgetary approval; c) Developing a Procurement Plan

2. Bid Invitation Process: Preparing tender documents, publication, receipt and opening of bids; 3. Bid Evaluation and Award of Contract:

a) Preliminary Examination and Evaluation of technical proposals: consideration of quality; b) Evaluation of financial proposals; c) Selection of winning proposal and award of the contract to the selected firm; and

4. Contract Management: Execution and Monitoring of Service Contract. Details and procedures of various stages of the procurement cycle would be described in following Chapters of the manuals.