Irregularities in the rate contract of cement: Clarification Please


A Spokesman of State Government said here today that a news item appeared in the section of press that there had been irregularities in the rate contract of cement was not based on facts and seems an attempt to mislead the people.

He said that Controller of Stores had invited tenders for the finalization of rate contract for the supply of cement on 14 December 2012 and finalized the rate contract after following the rules and procedures prescribed in the Store Purchase Rules. He said that M/S Ambuja Cement Ltd. was L-1 Firm who had quoted lowest rates for the supply of cement both for Portland Pozolana Cement (PPC) and Ordinary Portland Cement (OPC) and accordingly called for negotiations.

He said that after negotiations the Department was able to get quoted rates reduced to Rs. 161 and Rs. 176 per 50 kg. bag for both PPC and OPC cement respectively from initially quoted of Rs. 174 and Rs. 187 per 50 kg. bag for PPC and OPC cement respectively. Thus there was a reduction of Rs. 13 per 50 kgs. bag in respect of PPC and Rs. 11 per 50 kgs. bag in respect of OPC.

He further said that the firm had also agreed to bear the burden of VAT. Adding that last year the rate of cement was Rs. 182.70 inclusive of VAT whereas this year the same was Rs. 161 only. He said that Government had saved Rs. 21.70 per bag of cement which was a substantial reduction and net gain to the State Government was about Rs. 18.50 crores on the account of reduction of price per bag and VAT, while entering into the rate contract with L-1 Firm only.

He said that extra freight on account of supplies from Darlaghat would be of the tune of Rs. 5.42 crores and the thus there would be net saving of Rs. 13.08 crores. The L-1 Firm was also in capacity to make the entire Government supply of cement at its own level, so a parallel of rate contract was not considered in the favour of other participating firms as per the essence of the parallel rate contract as defined in rules.

He said that there was reduction of Rs. 21 per bag of cement and even for supplies made to areas where M/S ACC Ltd. was supplying cement earlier, the Government was saving rupees eight per bag of cement. He said that in totality cement for Government procurement had become cheaper than last year and allegations were far from the facts.

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