Annexure-1
INTEGRITY PACT
PRE-CONTRACT INTEGRITY PACT
GENERAL
This pre-bid contract Agreement (herein after called the Integrity Pact) is made on________ day of the month
of_________ 20…, between, on one hand, the Rural electrification Corporation Ltd. Acting through
Shri……………………., Designation of the officer, (hereinafter called the "REC”, which expression shall mean and
include, unless the context otherwise requires, his successors in the office and assigns) of the First Part and
M/s.__________________ represented by Shri _________________ (hereinafter called the
"BIDDER/SELLER/CONSULTANT”, which expression shall mean and include, unless the context otherwise
requires, his successors and permitted assigns) of the Second Part.
WHEREAS the REC propose to procure (Items and Services as per the Scope Of Work Mentioned in The Tender
Document (hereinafter called the "Items and Services”, which expression shall mean and include, unless the
context otherwise requires, any additions & deletions in the said "Items and Services”) and the BIDDER/
Seller/ Consultant is willing to offer/has offered the said "Items and Services”.
WHEREAS the BIDDER/ Consultant is a Private Company/Public Company/Government Undertaking/
Partnership/registered export agency, constituted in accordance with the relevant law in the matter and the
REC is a Ministry/ Department of the Government of India/PSU performing its function on behalf of the
President of India.
NOW, THEREFORE,
To avoid all forms of corruption by following a system that is fair, transparent and free from any
influence/prejudiced dealings prior to, during and subsequent to the currency of the Contract to be entered
into with a view to:-
Enabling the REC to obtain the desired "Items and Services” at a competitive price in conformity with the
defined specifications by avoiding the high cost and the distortionary impact of corruption on public
procurement, and
Enabling BIDDER/ CONSULTANT to abstain from bribing or indulging in any corrupt practice in order to secure
the contract by providing assurance to them that their competitors will also abstain from bribing and other
practices and the REC will commit to prevent corruption, in any form, by its official by following transparent
procedures.
The parties hereto hereby agree to enter into this Integrity Pact and agree as follows:
Commitments of the REC
1.
1.1. The REC undertakes that no official of the REC, connected directly or indirectly with the contract,
will demand, take a promise for or accept, directly or through intermediaries, any bribe,
consideration, gift, reward, favour or any material or immaterial benefit or any other advantage
from the BIDDER/CONSULTANT, either for themselves or for any person, organization or third party
related to the contract in exchange for an advantage in the bidding process, bid evaluation,
contracting or implementation process related to the contract.
1.2. The REC will, during the pre-contract stage, treat all BIDDER/CONSULTANT alike, and will provide to
all BIDDER/CONSULTANT the same information and will not provide any such information to any
particular BIDDER/CONSULTANT which could afford an advantage to that particular
BIDDER/CONSULTANT in comparison to the other BIDDER(S)/CONSULTANT(S).
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1.3. All the officials of the REC will report the appropriate Government office any attempted or
completed breaches of the above commitments as well as any substantial suspicion of such a
breach.
2. In case any such preceding misconduct on the part of such official(s) is reported by the
BIDDER/CONSULTANT to the REC with the full and verifiable facts and the same is prima facie found to
be correct by the REC, necessary disciplinary proceedings, or any other action as deemed fit, including
criminal proceedings may be initiated by the REC and such a person shall Be debarred from further
dealings related to the contract process. In such a case, while an enquiry is being conducted by the REC,
the proceedings under the contract would not be stalled.
Commitments of BIDDERs/ CONSULTANTs
3. The BIDDER/CONSULTANT commits itself to take all measures necessary to prevent corrupt practices,
unfair means and illegal activities during any stage of its bid or during any pre-contract or post-contract
stage in order to secure the contract or in furtherance to secure it and in particular commit itself to the
following:-
3.1. The will not offer, directly or through intermediaries, any bribe, gift, consideration, reward, favour,
any material or immaterial benefit or other advantage, commission, fees, brokerage or inducement
to any official of the REC, connected directly or indirectly with the biding process, or to any person,
organization or third party related to the contract in exchange for any advantage in the bidding,
evaluation, contracting and implementation of the contract.
3.2. The BIDDER/CONSULTANT further undertakes that it has not given, offered or promised to give,
directly or indirectly any bribe, gift, consideration, reward, favour, any material or immaterial
benefit or other advantage, commission, fees, brokerage, or inducement to any official of the REC
or otherwise in procuring the Contract of forbearing to do or having done any act in relation to the
obtaining or execution of the contract or any other contract with the Government for showing or
forbearing to show favour or disfavour to any person in relation to the contract or any other contract
with the Government.
3.3. The BIDDER/CONSULTANT shall disclose the name and address of agents and representatives and
Indian BIDDERSs shall disclose their foreign principals or associates.
3.4. The BIDDER/CONSULTANT shall disclose the payments to be made by them to agents/brokers or
any other intermediary, in connection with this bid/contract.
3.5. The BIDDER/CONSULTANT further confirms and declares to the REC that he BIDDER/CONSULTANT
is the original manufacture/Integrator/authorized government sponsored export entity of the
defence stores and has not engage any individual or firm or company whether Indian or foreign to
intercede, facilitate or in any way to recommend to the REC or any of its functionaries, whether
officially or unofficially to the award of the contract to the BIDDER/CONSULTANT, nor has any
amount been paid. Promised or intended to be paid to any such individual, firm or company in
respect of any such intercession, facilitation or recommendation.
3.6. The BIDDER/CONSULTANT, either while presenting the bid or during pre-contract negotiations or
before signing the contract, shall disclose any payment he has made, is committed to or intends to
make to officials of the REC or their family members, agents, brokers or any other intermediaries in
connection with the contract and the details of services agreed upon for such payments.
3.7. The BIDDER/CONSULTANT will not collude with other parties interested in the contract to impair
the transparency, fairness and progress of the bidding process, bid evaluation, contracting and
implementation of the contract.
3.8. The BIDDER/CONSULTANT will not accept any advantage in exchange for any corrupt practice, unfair
means and illegal activities.
3.9. The BIDDER/CONSULTANT shall not use improperly, for purpose of competition or personal gain, or
pass on to others, any information provided by the REC as part of the business relationship,
regarding plans, technical proposal and business details, including information contained in any
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electronic data carrier. The BIDDER/CONSULTANT also undertakes to exercise due and adequate
care lest any such information is divulged.
3.10. The BIDDER/CONSULTANT commits to refrain from giving any complaint directly or through any
other manner without supporting it with full and verifiable facts.
3.11. The BIDDER/CONSULTANT shall not instigate or cause to instigate any third person to commit
any of the actions mentioned above.
3.12. If the BIDDER/ CONSULTANT or any employee of the BIDDER/ CONSULTANT or any person acting
on behalf of the BIDDER/ CONSULTANT, either directly or indirectly, is a relative of any of the
officers of the REC, or alternatively, if any relatives of an officer of the REC had financial
interest/stake in the BIDDER’s/ CONSULTANT’s firm, the same shall be disclosed by the BIDDER/
CONSULTANT at the time of filling of tender.
The term ‘relative’ for this purpose would be as defined in Section 6 of the Companies Act 1956.
3.13. The BIDDER/CONSULTANT shall not lend to or borrow any money from or enter into any
monetary dealings or transactions, directly or indirectly, with any employee of the REC.
4. Previous Transgression
4.1. The BIDDER/CONSULTANT declares that no previous transgression occurred in the last three years
immediately before signing of this Integrity Pact with any other company in any country in respect
of any corrupt practices envisaged hereunder or with any Public Sector Enterprise in India or any
Government Department in India that could justify B1DDER's/CONSULTANT’s exclusion from the
tender process.
4.2. The BIDDER/CONSULTANT agrees that if it makes incorrect statement on this subject, BIDDER can
be disqualified from the tender process or the contract, if already awarded, can be terminated for
such reason.
5. Earnest Money (Security Deposit)
5.1. While submitting commercial bid, the BIDDER/CONSULTANT deposit an amount _________ (as
specified in TENDER) as Earnest Money/Security, Deposit, with the REC through any of the following
instruments:
5.1.1.Bank Draft or a Pay Order in favour of ‘Rural Electrification Corporation Limited’ payable at New
Delhi
5.1.2.A confirmed guarantee by an Indian Nationalized Bank, promising payment of the guaranteed
sum to the RECL on demand within three working days without any demur whatsoever and
without seeking any reasons whatsoever. The demand for payment by the RECL shall be treated
as conclusive proof of payment.
5.1.3.Any other mode or through any other instrument (to be specified in the TENDER.
5.2. The Earnest Money/ Security Deposit shall be valid as per terms of TENDER.
5.3. In the case of successful BIDDER/CONSULTANT, a clause would also be incorporated in the Article
pertaining to Performance Bond in the Purchase Contract that the provisions of Sanctions for
violation shall be applicable for forfeiture of Performance Bond in case of a decision by the REC to
forfeit the same without assigning any reason for imposing sanction for violation of this Pact.
5.4. No interest shall be payable by the REC to the BIDDER/CONSULTANT on Earnest Money/Security
Deposit for the period of its currency.
6. Sanctions for Violations
6.1. Any breach of the aforesaid provisions by the BIDDER/CONSULTANT or any one employed by it or
acting on its behalf (whether with or without the knowledge of the BIDDER/SELLER/CONSULTANT)
shall entitle the REC to take all or any one of the following actions, wherever required:-
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6.1.1.To immediately call off the pre contract negotiations without assigning any reason or giving any
compensation to the BIDDER/CONSULTANT. However, the proceedings with the other
BIDDER(s) would continue.
6.1.2.The Earnest Money Deposit (in pre-contract stage) and/or Security Deposit/Performance Bond
(after the contract is signed) shall stand forfeited either fully or partially, as decided by the REC
and the REC shall not be required to assign any reason therefore.
6.1.3.To immediately cancel the contract, if already signed, without giving any compensation to the
BIDDER.
6.1.4.To recover all sums already paid by the REC, and in case of the Indian BIDDER/CONSULTANT
with interest thereon at 2% higher than the prevailing Prime Lending Rate of State of India,
while in case of a BIDDER/CONSULTANT from a country other than India with Interest thereon
at 2% higher than the LIBOR. If any outstanding payment is due to the BIDDER from the REC in
connection with any other contract for any other stores, such outstanding payment could also
be utilized to recover the aforesaid sum and interest
6.1.5.To encash the advance bank guarantee and performance bond/warranty bond, if furnished by
the BIDDER/CONSULTANT, in order to recover the payments, already made by the RECL, along
with interest.
6.1.6.To cancel all or any other contracts with the BIDDER/CONSULTANT. The BIDDER shall be liable
to pay compensation for any loss or damage to the REC resulting from such
cancellation/rescission and the REC/PRINCIPAL shall be entitled to deduct the amount so
payable from the money(s) due to the BIDDER/CONSULTANT.
6.1.7.To debar the BIDDER/CONSULTANT from participating in future bidding processes of the
Government of India REC/PRINCIPAL for a minimum period of five years, which may be further
extended at the discretion of the REC.
6.1.8.To recover all sums paid in violation of this Pact by BIDDER/CONSULTANT (s) to any middlemen
or agent or broken with a view to securing the contract.
6.1.9.In cases where irrevocable Letters of Credit have been received in respect of any contract
signed by the REC with the BIDDER/CONSULTANT, the same shall not be opened.
6.1.10. Forfeiture of performance Bond in case of a decision by the REC to forfeit the same without
assigning any reason for imposing for sanction for violation of this pact.
6.2. The REC will be entitled to take all or any of the actions mentioned at para 6.1 (i) to (x) of this Pact
also on the Commission by the BIDDER/CONSULTANT or any one employed by it or acting on its
behalf (whether with or without the knowledge of the BIDDER/CONSULTANT), of an offence as
defined in Chapter IX of the Indian Penal code, 1860 or Prevention of Corruption Act, 1988 or any
other statute enacted for prevention of corruption.
6.3. The decision of the REC to the effect that a breach of the provisions of this pact has been committed
by the BIDDER/CONSULTANT shall be final and conclusive on the BIDDER/CONSULTANT. However,
the BIDDER/CONSULTANT can approach the Independent Monitor(s) appointed for the purposes of
this Pact.
7. Independent Monitors
7.1. The REC has appointed Independent Monitors (hereinafter referred to as Monitors) for this Pact in
consultation with the Central Vigilance Commission (Names and Addresses of the Monitors shall be
published subsequently by REC).
7.2. The task of the Monitors shall be to review independently and objectively, whether and to what
extent the parties comply with the obligations under this Pact.
7.3. The Monitors shall not be subject to instructions by the representatives of the parties and perform
their functions neutrally and independently.
7.4. Both the parties accept that the Monitors have the right to access all the documents relating to the
project/procurement, including minutes of meetings.
7.5. As soon as the Monitor notices, or has reason to believe, a violation of this Pact, he will so inform
the Authority designated by the REC.
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7.6. The BIDDER/CONSULTANT(s) accepts that the Monitors has the right to access without restriction
to all project documentation of the REC including that provided by the BIDDER/CONSULTANT. The
BIDDER/CONSULTANT will also grant the Monitor, upon his request and demonstration of a valid
interest, unrestricted and unconditional access to his project documentation. The same is applicable
to Subcontractors. The Monitor shall be under contractual obligation to treat the information and
documents of the BIDDER/CONSULTANT/Subcontractors(s) with confidentially.
7.7. The BUYER will provide to the Monitors sufficient information about all meetings among the parties
related to the Project provided such meetings could have an impact on the contractual relations
between the parties. The parties will offer to the monitor the option to participate in such meetings.
7.8. The Monitor will submit a written report to the designated Authority of REC /Secretary in the
Department/ within 8 to 10 weeks from the date of reference or intimation to him by the
REC/BIDDER/CONSULTANT and, should the occasion arise, submit proposals for correcting
problematic situations.
8. Facilitation of Investigation
In case of any allegation of violation of any provisions of this Pact or payment of commission, the REC or its
agencies shall be entitled to examine all the documents including the Books of Accounts of the
BIDDER/CONSULTANT and the BIDDER/CONSULTANT shall provide necessary information and documents in
English and shall extend all possible help for the purpose of such examination.
9. Law and Place of Jurisdiction
This Pact is subject to Indian Law. The place of performance and jurisdiction is the seat of the REC.
10. Other Legal Actions
The actions stipulated in this Integrity Pact are without prejudice to any other legal action that may follow in
accordance with the provisions of the any extent law in force relating to any civil or criminal proceedings.
11. Validity
11.1. The validity of this Integrity Pact shall be from the date of its signing and extend up to 5 years or
the complete execution of the contract to the satisfaction of both the REC and the
BIDDER/SELLER/CONSULTANT, including warranty period, whichever is later. In case
BIDDER/SELLER/CONSULTANT is unsuccessful, this Integrity Pact shall expire after six months from
the date of the signing of the contract.
11.2. Should one or several provisions of this Pact turn out to be invalid; the remainder of this Pact shall
remain valid. In this case, the parties will strive to come to an agreement to their original
intentions.
12. The parties hereby sign this Integrity Pact at_________ on_________
REC: BIDDER/ CONSULTANT:
Name of the Officer ________________________ _______________________
Designation ________________________ _______________________
Witness: Witness:
1.____________________________ 1. __________________________
2. ____________________________ 2. __________________________
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