E-Procurement Agreement - Final

E-PROCUREMENT SERVICE PROVIDER AGREEMENT

This Agreement made on this ……………. day of ………………………….

2012 at …………………………………

between………………………………………………….

……………………………………… a Limited Company incorporated under

the Companies Act, 1956 having its Registered Office at

………………………………………………………………………………………

…………………… hereinafter referred to as the “Service Recipient” (which

expression unless excluded by or repugnant to the context shall mean and

include its successors in office and assigns)-the party of the FIRST PART.

AND

MSTC Limited, a Government of India Company within the meaning of

Section 617 of the Companies Act, 1956having its Registered Office at

225-C, AJC Bose Road, Kolkata – 700 020, hereinafter referred to as the

“Service Provider” (which expression unless excluded by or repugnant to

the context shall mean and include its legal heirs, successors in office and

assigns)-MSTC, the party of the SECOND PART.

WHEREAS MSTC, the party of the SECOND PART has developed an

elaborate system for providing e-procurement services to its various clients

enabling them to procure goods, services and works and its e-procurement

comprehensive infrastructure helps expansion of e-commerce providing a

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robust, proven platform enabling trade between companies of different

sizes, platforms and locations.

AND WHEREAS the e-procurement system provides real-time bidding

solutions for buyers and sellers that bring competitive level of profitability,

control and simplicity to corporate procurement and liquidation processes

and includes inter alia e-tendering and e-reverse auctioning for inviting on-

line bids from intending bidder(s).

AND WHEREAS the ‘Service Recipient’ has discussed with the officials of

MSTC, the party of the SECOND PART and has acquainted itself

thoroughly with such internet based e-procurement system developed by

MSTC and has expressed its desire to use MSTC’s e-procurement system

for procuring their goods, services and works.

AND WHEREAS on the basis of the discussion between the officials of the

‘Service Recipient’ and ’Service Provider’, the party of the FIRST PART

has expressed its willingness to avail the e-procurement services of the

party of the SECOND PART and the ‘Service Provider’ has expressed its

willingness to render its e-procurement services to the ‘Service Recipient’

subject to certain terms and conditions which were discussed and agreed

to by and between the parties as provided hereinafter.

NOW THIS AGREEMENT WITHNESSETH the terms and conditions

agreed to by and between the parties hereto for the purpose aforesaid as

under:-

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1. Definitions:

1.01: ‘MSTC e-procurement system’-means the use of web /

internet based technology developed by the Service Provider to

support key elements of the procurement process such as: requisition

or Web-based ERP (Enterprise Resource Planning), e-sourcing, e-

tendering, e-reverse auctioning, e-Informing / ordering /invoicing

/payment/ specification etc. for business to business purchase and

sale of goods /services / works.

1.02: Web-based ERP (Enterprise Resource Planning): means

creating and approving purchasing requisitions, placing purchase

orders and receiving goods and services by using a software system

based on Internet technology.

1.03: e-sourcing means identifying new suppliers for a specific

category of purchasing requirements using Internet technology.

1.04: e-tendering means sending requests for information and prices

to suppliers and receiving the responses of suppliers using Internet

technology.

1.05: e-reverse auctioning means using Internet technology to buy

goods and services from a number of known or unknown suppliers.

1.06: e-informing means gathering and distributing purchasing

information both from and to internal and external parties using

Internet technology.

1.07: ‘Service Recipient’ means the party of the FIRST PART who

receives e-procurement service from the party of the Second Part.

1.08: ‘Service Provider’ means the party of the SECOND PART who

provides / renders e-procurement service to the party of the First

Part. of 17

1.09: ‘Copy right other intellectual property rights’ will imply in this agreement to the extent that MSTC, the party of the SECOND PART is the owner of the copy right and trade mark relating to the e-procurement site related to this agreement and both Indian and international copyright and trademark laws protect the entire contents of the Site and will include all rights existing from time to time under patent law, copyright law, moral rights law, trade secret law, trademark law, competition law, information technology rights law, privacy rights law, and any and all other proprietary rights, and any and all applications, renewals, extensions and restorations thereof, now or hereafter in force and effect worldwide.

1.10: “Confidential Information” means all technical and non-technical information and documents disclosed or produced by either party in the course of this Agreement which are disclosed in written form and identified by a marking thereon as proprietary, or oral information which is defined at the time of disclosure and confirmed in writing within ten (10) business days of its disclosure, shall be deemed the "Confidential Information" of the disclosing party. Notwithstanding the above, the parties agree that any information (in any form, whether in tangible or Intangible) relating to the Service Provider’s Technology is considered Confidential Information of the Party of the SECOND PART.

2. This is a Service Provide Agreement wherein MSTC the party of the

SECOND PART shall act only as a Service Provider to the party of

the FIRST PART and shall not be a party to any contract that the

party of the FIRST PART may enter into with its supplier(s) /

vendor(s) / contractors pursuant to use of the system provided by

MSTC, the party of the SECOND PART.

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3. ROLES AND RESPONSIBILITIES OF MSTC, THE PARTY OF THE

SECOND PART:

(a) MSTC, the party of the SECOND PART shall make all reasonable

arrangements to provide the party of the FIRST PART with the

facility to use the MSTC e-procurement system throughout the

duration of the Agreement. MSTC shall make its e-procurement

technology infrastructure available for use by the Party of the

FIRST PART. However, at no point of time, the Service Recipient

will have any ownership, in full or in part, of any of the facilities

being provided by MSTC, the party of the SECOND PART.

(b) If required by the party of the FIRST PART, MSTC-the party of the

SECOND PART shall arrange for providing training to the users of

the e-procurement system at the Service Recipient’s end as well

as the vendors who shall participate in the events that shall be

conducted by the Service Recipient using the e-procurement

system of the Service Provider. The cost of such required training

shall be borne by the Service Recipient. Service Provider shall

depute its executive(s) for imparting training.

(c) MSTC, the party of the SECOND PART shall undertake minor

customization of the e-procurement system to suit any specific

need of the party of the FIRST PART without charging any fees

from the Service Recipient for any minor customization. If major

changes / customizations are required, MSTC, the party of the

SECOND PART shall be at liberty to charge customization fees

MSTC, the party of the SECOND PART retains the exclusive right

to classify the amendment / customization as minor or major.

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(d) It shall be the responsibility of MSTC, the party of the SECOND

PART to keep its e-procurement system updated so as to be

complying with the relevant guidelines of Central Vigilance

Commission and provisions of Information Technology Act 2000

as may be amended from time to time. Accordingly, MSTC, the

party of the SECOND PART shall get its system periodically

audited by recognized authorities like Standardisation, Testing and

Quality Certification (STQC) Directorate which is an attached office

of the Department of Electronics and Information Technology,

Government of India,

(e) MSTC, the party of the SECOND PART shall maintain a valid ISO

27001:2005 certification (which relates to Information Security

Management System) throughout the duration of this Agreement.

4. ROLES AND RESPONSIBILITIES OF THE PARTY OF THE FIRST

PART-THE SERVICE RECIPIENT:

i. It shall be responsibility of the ‘Service Recipient’ to get well

acquainted with the e-procurement system of the ‘Service

Provider’ so as to use the system correctly and make use of all

the features available in the system.

ii. The party of the FIRST PART shall nominate one Nodal Officer

for e-procurement who shall be registered with the ‘Service

Provider’ as the authorized person for the ’Service Recipient’ to

deal with the ‘Service Provider’ in the affairs of e-procurement

service. Such Nodal Officer shall be the single point contact for

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all communications between the ‘Service provider’ and the

’Service Recipient’.

iii. The Nodal Officer nominated by the party of the FIRST PART

shall create various users of the Buyer.

iv. All activities under the offered e-procurement system (like from

generation of indents to Issuance of LOI / Purchase Order to

successful vendors) will be carried out by different users/clients

of the ‘Service Recipient’; and MSTC, the party of the SECOND

PART shall not be involved in any of the activities which is

exclusively related between the ‘Service Recipient’ and its users/

clients.

v. All the users of the ‘Service Recipient’ must have Digital

Signature Certificate of class II or class III. The Digital Signature

Certificates shall be either for signing any document

electronically or for data encryption. The ‘Service Recipient’ shall

have to purchase the required number of Digital Signature

Certificates for its users from authorized agencies at its own cost

and arrangement.

vi. The party of the FIRST PART shall arrange for publicity of its

forthcoming events in print media and through its website at its

own cost.

vii. If any vendor participates in any e-procurement event without

paying the transaction fees to the ‘Service Provider’, the party of

the FIRST PART shall extend full cooperation to MSTC, the party

of the SECOND PART for recovering the transaction fees from

the vendor(s) to the extent of but not limited to deducting it from

any payment due to the vendor from the buyer. of 17

viii. EMD against any e-tender or e-reverse auction shall be

collected and refunded by the party of the FIRST PART and

MSTC, the party of the SECOND PART shall not be responsible

for collection, processing or refund of EMD and for any dispute

between the party of the FIRST PART and the vendors arising

out of any issues related to EMD.

ix. Further role and responsibility matrix shown in Annexure-A

hereto.

5. NON – LIABILITY CLAUSE OF THE GOVERNMENT OF INDIA

It is clearly understood and accepted by the parties hereto that

Government of India is not a party to this Agreement in any way and

no liability whatsoever attaches to the Government in any manner

arising out of any execution, performance, non-performance or

otherwise of this Agreement by the parties hereto.

6. INCORPORATION OF INTEGRITY PACT BY REFERENCE

The parties hereto agree to be bound by the terms of the Integrity

Pact prescribed under the rules, the terms whereof are known to the

parties hereto and deemed to be incorporated in this Agreement by

reference.

7. TRANSACTION FEES AND TRAINING CHARGES

(a) MSTC shall collect transaction fees at the rate of 0.05% of the

estimated value of the procurement per event from all the of 17

participating vendors subject to a minimum of Rs 1,000/- (Rupees

One Thousand only) and maximum of Rs 15,000/- (Rupees

Fifteen Thousand only) per event per vendor. For the avoidance of

doubt, an event shall be construed as an e-tender or an e-reverse

auction or any other mode of e-procurement services as may be

mutually decided by the ‘Service Provider’ and the ‘Service

Recipient’ irrespective of the number of items being procured

through the same. Service tax on the transaction fees and other

statutory charges on service tax shall be payable extra by the

vendors.

(b) For imparting training to the users of the Buyer, MSTC, the party

of the SECOND PART shall be paid training charges (along with

applicable service tax) by the ‘Service Recipient’ at the following

rate :

(i) For a training session containing one day, the training

charges shall be Rs 20,000/- (Rupees Twenty Thousand

only) plus applicable service tax and other statutory

charges on service tax.

(ii) For a training session containing more than one day,

training charges shall be Rs 20,000/- (Rupees Twenty

Thousand only) for the first day and Rs 5,000/- (Rupees

Five Thousand only) per day for all subsequent days.

(iii) For avoidance of doubt, a training session shall mean a

period of training that will involve a single trip made by

MSTC’s official to the place of the party of the FIRST

PART.

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(c) All such trainings shall take place at the premises of the ‘Service

Recipient’ only. MSTC, the party of the SECOND PART shall raise

monthly bills towards training charges and the party of the FIRST

PART shall make the full payment within 30 days from the date of

receipt of the bills.

(d) Necessary arrangements for the training sessions like providing

computers, conference hall, internet connection, paper, pencil etc

shall be made by the ‘Service Recipient’ at its own cost and

MSTC, the party of the SECOND PART shall not bear any cost

towards such arrangements.

(e) MSTC, the party of the SECOND PART reserves the exclusive

right to revise the transaction fee and/or training charges from time

to time during the currency of this Agreement.

(f) The service tax or any other statutory charges on the transaction

fees shall be payable extra by the vendor(s).

(g) MSTC shall not collect any transaction fee from the Buyer.

8. DURATION OF CONTRACT

The Agreement shall remain valid for a period of 5 (five) years from

the date of signing. At the end of the validity period, the Agreement

may be extended for further such period as may be mutually agreed

by the parties hereto on same or different terms and conditions as

may be mutually agreed by both parties. Such extension of the

Agreement along with the terms and conditions shall be written and

signed by both the parties.

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9. TERMINATION OF AGREEMENT

Either party may terminate the Agreement before the end of validity of

the Agreement as stated aforesaid by serving one month’s notice in

writing to the other party. Under such a case, neither party shall be

entitled to claim any compensation from the other party for the pre-

mature termination of the Agreement. All pending jobs as on the date

of termination of the Agreement shall be continued till completion as if

the Agreement was in force.

10. GENERAL PROVISIONS

(a) While MSTC, the party of the SECOND PART shall make all

reasonable efforts to make its e-procurement system available for

use by the ’Servce Recipient’; and MSTC, the party of the

SECOND PART shall not be responsible for any disruption of

services due to reasons beyond its control as covered under Force

Majeure clause. MSTC shall not be liable to pay any compensation

to either the party of the FIRST PART or its vendor(s) for any loss

accrued to them due to such disruption in services.

(b) During the currency of this Agreement, the party of the FIRST

PART shall not engage the services of any other agency for e-

procurement services. If any particular requirement of the ‘Service

Recipient’ remains unfulfilled even after all customizations have

been made by the ‘Service Provider’, the party of the FIRST PART

may engage another service provider for that particular event after

obtaining written consent of the party of the SECOND PART. of 17

(c) MSTC, the party of the SECOND PART shall not be liable in any

manner for any inconvenience due to any disruption in internet

services at bidders’ end. However, if any disruption takes place at

Service Provider’s end during the progress of any event, MSTC,

the party of the SECOND PART shall make all efforts to restore

normal services at the earliest.

(d) Neither party shall assign or transfer its rights and obligations

under this Agreement (in whole or in part) without the prior written

consent of the other.

(e) No waiver of any breach of this Agreement shall be deemed to be

a waiver of any other or of any subsequent breach. The failure of

either party to enforce at any time any of the provisions of this

Agreement shall in no way be interpreted as a waiver of such

provision.

(f) In the event that any or any part of the provisions contained in the

Agreement be determined invalid, unlawful or unenforceable to

any extent, such terms, conditions or provisions shall be severed

from the remaining provisions which shall continue to be valid and

enforceable to the fullest extent permitted by law.

(g) This Agreement replaces and supersedes any prior

understandings, communications and representations whether

verbal or written. This Agreement may only be amended by

execution of a written document duly signed by the authorized

representatives of both parties.

(h) The ‘Service Recipient’ hereby agrees that their users/clients will

be responsible for maintaining the confidentiality of the password

and account, and are fully responsible for all activities that occur of 17

under their password or account. The users will be responsible to

notify the ‘Service Provider’ about any unauthorized use of the e-

procurement site and the ‘service Recipient’ will impose terms and

restrictions upon their users so that the ‘Service Provider’ cannot

and will not be liable for any loss or damage arising from their

failure to comply with the breach of security of their account.

(i) The ‘Service Recipient’ hereby agrees that the ‘Service Provider’

will not be responsible for the information provided in the tenders

published. In case of any clarifications arising out of the tenders,

the users have to contact the respective Tender Inviting Authority,

i.e. the party of the FIRST PART herein.

(j) The ‘Service Recipient’ hereby agrees that the suppliers / the

bidders have to ensure to the effect that the files being uploaded

by them are free from all kinds of viruses and contains only the

relevant information as stated by the tender inviting authorities for

the particular tender. If any bidder / company has uploaded /

attached irrelevant data, bogus or fabricated certificates towards

his qualification requirements to the respective tender then their

user account will be made liable for termination permanently or

temporarily.

(k) The ‘Service Recipient’ hereby agrees that the users/bidders are

entirely responsible for all Content that they upload, post, e-mail or

otherwise transmit via the e-Procurement portal. The party of the

SECOND PART herein does not control the Content posted via

the e-Procurement portal and, as such, does not guarantee the

accuracy, integrity or quality of such Content. Under no

circumstances will the ‘Service Provider’ be liable in any way for of 17

any Content, including, but not limited to, for any errors or

omissions in any Content, or for any loss or damage of any kind

incurred as a result of the use of any Content posted, e-mailed or

otherwise transmitted via the Site.

(l) The ‘Service Recipient’ hereby agrees that their users are to

comply with all local rules regarding online conduct and acceptable

Content. Specifically, must agree to comply with all applicable laws

regarding the transmission of technical data to and from India or

the country in which they reside.

11. FORCE MAJEURE

If, any time during the continuance of this Agreement, the

performance, in whole or in part by either party, of any obligation

under this Agreement be prevented or delayed by reason of any war,

hostility, act of public enemy, civil commotion, sabotage, fires, floods,

explosions, epidemics, quarantine restrictions, strikes, lock-outs,

Technical and / or Connectivity failure which is entirely beyond the

control of the ‘Service Provider’, acts of God (hereinafter referred to

as ‘events’) provided notice of happening of any such eventuality is

given by the affected party to the other within 21 days from the date

of occurrence thereof, neither party shall by reason of such event

have any claim for damages against the other party in respect of such

non-performance or delay in performance, provided further that if the

performance in whole or part of any obligation under this Agreement

is prevented or delayed by reasons of any such event for a period

exceeding sixty days, the parties shall try to arrive at an amicable

settlement, failing such settlement may terminate this Agreement. of 17

12. ARBITRATION

In the event of any dispute or difference relating to the interpretation

and/or application of the provisions of any clause of this Agreement,

such dispute or difference shall be referred by either party to the

Arbitration of sole arbitrator to be nominated by the Secretary to the

Government of India, In Charge of the Bureau of Public Enterprises.

The request for appointment of arbitrator to the said appointing

authority must be made giving copy of request to the other side. The

Arbitration and Conciliation Act 1996 shall be applicable in all

circumstances other than agreed terms and procedure between the

parties. The award of the Arbitration shall be binding upon the parties

to the dispute, provided, however, any party aggrieved by such award

may make a further reference within 30 days of the final award

passed by the sole arbitrator to the Law Secretary, Department of

Legal Affairs, Ministry of Law & Justice, Government of India to

decide the legality of the award of the sole arbitrator within the scope

of this agreement and law of contract. Upon such reference the

dispute shall be decided by the Law Secretary himself, or the Special

Secretary/Additional Secretary when so authorized by the Law

Secretary, whose decision shall bind the parties finally and

conclusively. The parties to the dispute will share equally the cost of

arbitration as intimated by the Arbitrator.

13. GOVERNING LAW

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The interpretation, construction and performance of this Agreement

shall be governed exclusively by laws in India and the parties

expressly submit to the exclusive jurisdiction of the courts of Kolkata

subject to the provision prescribed in clause 12 of this agreement.

14. Counterparts:

This Agreement may be executed simultaneously in two counterparts, each of which will be considered an original, but both

of which together will constitute one and the same instrument.

IN WITNESS WHEREOF the parties hereto have put their respective

hands and seals on the day, month and year above first written.

For :

(

)

Company Seal

Witness :

For : MSTC LIMITED

(

)

Company Seal

Witness :1. 1.

2. 2.

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Annexure A

Roles and Responsibility matrix for MSTC and the Buyer

Sl No. Activity Action By1 Registration of Nodal Officer of Buyer MSTC2 Registration of other users of Buyer Buyer3 Registration of vendors Buyer4 Training to users of Buyer and

vendors

MSTC

5 Indent raising / Item entry Buyer6 Publicity (advt) through newspaper Buyer7 Event creation Buyer8 Tender Committee creation Buyer9 NIT / Corrigendum upload Buyer10 Pre-Bid Meeting Buyer / vendors11 EMD receipt Buyer12 Transaction fee receipt MSTC13 Tender Opening Event Buyer14 Bid evaluation Buyer15 Bid approval / rejection Buyer16 Issuance of LOI / P.O Buyer17 System maintenance / up gradation MSTC

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E-Procurement Agreement - Final

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