Guidelines for awarding Annual maintenance Contracts (AMCs) for computer hardware / site maintenance etc. and delegation of financial powers – reg - Customs - 029/01

Circular No. 29/2001 16th, May 2001 F.No.D-21019/52-AMC/99/CC/CBEC Government of India Ministry of Finance Department of Revenue Central Board of Excise Customs Subject: Guidelines for awarding Annual maintenance Contracts (AMCs) for computer hardware / site maintenance etc. and delegation of financial powers - reg. Ministry has recently reviewed the powers available to Heads of Departments under Delegation of Financial Power Rules (DFPRs) for awarding Annual Maintenance Contracts for maintenance of computers, sites etc. At present as per Item No. 26(b) of schedule V of DFPRs Heads of Departments have full powers for hire or maintenance of computers when the work is entrusted to public sector undertakings. Doubts were raised regarding scope of expression 'Maintenance of Computers' as to whether it would include maintenance of site alongwith the DG sets, air conditioners etc. Department of Revenue examined the matter in consultation with Department of Electronics and Department of Expenditure. Keeping in view the advice of these departments the following guidelines and delegation are prescribed in the matter of awarding of AMCs: Maintenance of Site :- Maintenance of computers generally includes maintenance of computer hardware (processors, memory etc.) and peripherals (printers, plotters, scanners, secondary storage devices like tape devices etc). Therefore the maintenance of site which includes DG sets, air conditioners etc is not covered under the scope of 'Maintenance of Computers'. Delegation described under aforesaid Item No. 26(b) would not apply to maintenance of DG sets, air conditioners, electrical installations etc for computers. Therefore Head of Department has no power to award the AMC for site; in all such cases Ministry's prior sanction is required to be obtained. Maintenance of Computers: (a) In the case of maintenance of computer hardware, heads of the department shall have full powers to award AMC to public sector undertakings. It may be clarified that the procedure as laid down in the GFRs will have to be followed in all cases of award of AMC for hardware. Thus when the value of the contract exceeds Rs. 2 lakhs quotations will need to be invited and selection made accordingly. AMC is to be awarded to the PSU only if its quotation is the lowest one. In case the lowest bidder happens to be a PSU, Head of Department can award the AMC directly at his level. However if the lowest bidder is a non-PSU approval of Ministry would need to be obtained (subject to the delegation of power as at para 3 below). (b) In case of maintenance of software for desktop PCs, in-house staff can do the software maintenance as these systems have generally preloaded software. No AMC should be awarded for such software. (c) In case of maintenance of software for Mainframe computers, head of department shall have full powers to award AMC to PSU subject to the same guidelines as specified in sub para (a) above. However, considering the large number of references being received from the Commissionerates for award of AMC for hardware and peripherals, and in view of non-availability of suitable public undertakings at some cities who can take up the AMC, the Ministry has delegated the powers to the extent of Rs. 2 lakhs per annum to Heads of Departments for award of Annual Maintenance Contract to private parties also, subject to compliance of the procedure laid down under GFRs. Therefore the proposals for awarding AMC of computer hardware and peripherals to private persons upto an aggregate limit of Rs. 2 lakhs in a financial year can be decided at the level of Head of Department. All proposals in excess of the above powers are to be sent to the Ministry through Commissioner (Systems). All Heads of Departments are advised to send consolidated proposal for their Commissionerate. The proposal shall indicate clearly that Head of Department has exercised his powers upto Rs. 2 lakhs for award of AMC in the current financial year. Kindly acknowledge the receipt of this letter. (Dr. Vinayak Prasad) Under Secretary to the government of India