GOVERNMENT OF TAMIL NADU

Abstract

Highways Department - Tamil Nadu Road Sector Project  - Policy  framework  issued - Certain  items approved   - Orders issued.

 HIGHWAYS (HN.1) DEPARTMENT

G.O.(Ms)No.188
Dated 16.10.2002

Read the following

1) From the country Director, World Bank, letter dated 22.4.2002.
2) From the Project Director, Tamil Nadu Road Sector Project , Letter No.1250/C, dated  6.8.2002.
3) G.O. Ms. No.183, Highways Department, dated   16.10.2002.

******

ORDER:

In 1995, the Government of Tamil Nadu invited the World Bank to assist with the  Tamil Nadu Road Sector Project .  The World Bank's Mission of April-2002 has however  observed that a  policy frame work   would be prepared covering:-

 (i) The  proposals for a Project  Steering/Governing  Board and an Empowered Committee  to take project related  policy decisions and  procurement/ payment related issues.

 (ii) Plan to make  timely payments for works and consultancy  services.

1. (iii) Commitment to adhere to Contract Dispute  Resolution Mechanism. 
2. (iv)  Statement regarding the treatment of corporate/income taxes for payment when preparing and negotiating contracts with consultants / contractors / suppliers. 

2. In the Government Order third read above Government approved the Policy Frame work as required by the World Bank.  The Government have also directed therein to issue separate orders on relevant sections of the Policy Frame work which require endorsement at Government level.

3. As the following  issues require  immediate guidance and approval of Government of Tamil Nadu beyond the powers of Project authority during the Project Preparation and Implementation,  the Government issue orders as below:-

(i) Procurement of Consultancy, Goods  and Works.

The Government of Tamil Nadu hereby agrees to follow the procedure prescribed in the Loan Agreement signed with the World Bank.

(ii) Time commitment for finalisation  of Consultancy and civil Works:-

In conformity with the guidelines and procedures of the World Bank, the Project Implementation Unit (PIU) of Tamil Nadu Road Sector Project has to evaluate the bids, obtain approval of the Government, get clearance of the World Bank to the bid evaluation report and notify awards  to successful bidders and complete the signing  of agreement within the stipulated validity period of 120 days for International Competitive Bidding (ICB) works contracts and 90 days for National Competitive Bidding (NCB) goods and works contracts from the date of receipt of bids.  To achieve these time schedules,  a time frame as in Annexure I  be adopted for evaluation and finalisation by the Project Director, Tamil Nadu Road Sector Project.

(iii) Settlement of Bills:-

Payments shall be made promptly  to the bills at regular intervals  by the Project Director, Tamil Nadu Road Sector Project as in annexure II of this Government order ,  in accordance with the contract provisions,  and the disputed amounts only   be withheld.

(iv) Settlement of Disputes on Works:-

The settlement of disputes on goods, works and consultancy be resolved through mechanism so that  implementation of the Project should not face hurdles. Any dispute in connection with or arising out of the contract during execution of works including any disagreement by with any action, inaction, opinion, instruction, determination, certificate or valuation of the Engineer, the matter in dispute  be referred to Project Director. Project Director depending upon the merit and value of the dispute shall either decide at his level or refer the matter to the Steering Committee for a  final decision.  If the contractor is  not satisfied with the decisions of Project Director / Steering Committee, the matter  be  referred to the Dispute Review Board (DRB) for International Competitive Bid contracts, and to the adjudicators for National Competitive Bid contracts. A panel of 10 reputed experts  be selected and approved by the Government for nomination as members of DRB for ICB and adjudicators for NCB contracts. Dispute Review Board shall consist of one member from either party and the two members shall jointly select the third member who shall act as Chairman of the Dispute Review Board. If the recommendations of Dispute Review Board /Adjudicators are not accepted, the matter be finally  referred to Arbitration.

Settlement of disputes on Consultancy services:

The procedures for resolution of disputes outlined in the World Bank's Standard form of contract for consultancy services  be  followed. 

(v) Treatment of Taxes and Duties:-

Project Implementation Unit shall ensure that advance ruling  from the Income Tax or other concerned authorities  shall be obtained on the value of taxes payable under each contract and then this shall be discussed with the selected consultant/contractor, while negotiating the contract and this shall be incorporated in the contract document.  Taxes and duties shall be treated as per the Income Tax Act and the relevant Acts.

(vi) Tamil Nadu Transparency in Tenders Act, 1998:-

Section 15 of the above Act,  (The provisions of this Act to the extent they are not consistent with the procedure prescribed in the projects funded by International Agreements or by International Financial Agencies shall not apply) shall be followed for the Tamil Nadu Road Sector Project.  Wherever this Frame Work is in violation of World Bank's legal agreements/guidelines, the  legal agreements/guidelines of the World Bank shall prevail.     

(vii) Contract Management Adviser to the Project Director:

An Adviser shall be appointed  to the Project Director, Tamil Nadu Road Sector Project  to render advice on the procurement and contractual issues etc.

3.   This order issues with the concurrence of Finance Department vide its U.O.No. 4607 / FS / P / 2002, Dated 7.10.2002.

(BY ORDER OF THE GOVERNOR)

A.NAGARAJAN, 
SECRETARY TO GOVERNMENT

To

The Project Director , Tamil Nadu Road Sector Project , Guindy, Chennai-25.
All Chief Engineers in Highways Department, Chennai
The Country Director, World Bank, 70 Lodi Estate,  New Delhi - 110 003

Copy to

The Senior PA to Hon'ble Minister (Public Works,  Prohibition and Excise), Chennai - 9.
The  Finance Department (PW1 / EAP) Department, Chennai-9.
Pay and Accounts Officer, Chennai -35
The Accountant General , Chennai-18 / Chennai-35
SF/SC

//forwarded/by order//

SECTION OFFICER

Annexure to G.O.Ms.No.188, Highways, dated 16.10.2002

Annexure-I

Time frame for Consultancy Services

Time frame for Civil Works

AnnexureII

Payment Schedule

The following table shows the time schedule for payment of bills to the consultants, contractors and suppliers.

SECTION OFFICER