GENERAL FINANCIAL
RULES 2017
● BHAVESH NIKUMBH
● ASHISH KODAP
● PRASHANT KULKARNI
● VIRENDRA KUMAR PAL
ZTI UJJAIN
Introduction
● Issued for the first time in 1947
● Subsequently been modified and issued as GFRs 1963 and GFRs 2005
● Compilation of rules and orders of Government of India to be
followed by all while dealing with matters involving public finances
● To be treated as executive instructions
● Cover broad procurement rules
● Will enable an improved, efficient and effective framework for
fiscal management while facilitating timely delivery of services
● Rule 21 - High Standards of financial propriety should be maintained
● Rule 142 to 206 - general rules applicable to all Ministries or
Departments, regarding procurement of goods required for use in the
public service.
● Rule 149 - Government e-Market place (GeM).
○ platform provided to entities for procuring goods and services. It
is mandatory to procure through GeM if goods and services are
available on it.
○ Procuring authority to check the reasonableness of prices.
○ Pre-condition before purchasing include -:
1) Goods below 25000 rs can be purchased form any available
suppliers on GeM.
2) Goods priced between 25000 - 5 lakhs, minimum 3 supplier
prices to be compared.
3) Goods above 5 lakh to be procured through a budding
process
● Rule 160 - E-Procurement - It is mandatory for Ministries/ Departments
to receive all bids through e-procurement portals in respect of all
procurements.
● Rule 173 - Transparency, competition, fairness and elimination of
arbitrariness in the procurement process
● Rule 174 - Efficiency, Economy and Accountability in Public Procurement
System
● Rule 175 - Code of Integrity
○ Applicable for both the procuring entity and the bidder
○ Conflict of interest should be disclosed
○ It prohibits - offering/ solicitation/ acceptance of bribe
- collusion/ bid rigging/ anti-competitive approach
- coercion/ threat to impair or harm
● Rule 151 Debarment provision
○ Debarment in case of conviction
○ Maximum period of debarment
○ Reasonable opportunity to be given
● Rule 153 Purchase preference
○ Preference to MSMEs
○ Exclusive purchase from KVIC
● Mandatory electronic procurement and exemptions
● Rule 170 Bid security
○ Earnest money to safeguard withdrawing or altering of bid
○ Return of security for unsuccessful bidders
○ Bid security declaration
● Rule 171 Performance security
○ To ensure quality performance from successful bidder
awarded contract
○ Validity and return of security
● Criteria for evaluation of bids (rule 173)
○ In evaluation things to be checked include price, cost of operating and
maintaining and environmental characteristics.
● Conditions for acceptance of single offer (rule 173)
○ Due process was followed
○ Reasonable rates
○ Qualification criteria not unduly restrictive.
● Startup as defined by DIPP
○ Should not be more than10 year old.
○ Turnover for any financial year should not exceed 100 crore.
○ Working towards innovation and commercialisation of products, process and services driven
by technology.
● Startup fulfillling above condition should get a certificate from Inter ministerial
board of certification.
● Under general financial rules 2017 there are relaxations given to start ups under rule
173.
● Norms are relaxed in prior turnover and experience field ,subject to meeting the
quality and technical specification required.
● Electronic Reverse Auction
○ Online real-time purchasing is done through Electronic reverse
auction (Rule 167)
○ It involves presentation by bidders and automatic evaluation of
bids.
○ Unlike forward auctions, where bids increase as the auction
progresses, in reverse auctions, bidding starts with the highest
possible price and decreases gradually. The lowest bid wins.
○ While detailed specifications are pre determined in reverse
auction where it is not possible, a two stage building (Rule 164 )
process is followed.
○ Two stage building is required areas where there is rapid
technology development and the area of study and research.
● Rule 173 (xvii) Energy efficient electrical appliances
○ Ministries shall carry the threshold or higher star rating
● Rule 177 Consultancy services
○ Procurement of the IT projects
○ IT projects may include software development, cloud based
services etc.
● Procurement of the IT projects
○ IT projects may include software development, cloud based
services etc.
● Rule 192 Quality and cost basis selection (QCBS)
○ To ensure due weightage to Quality is given in procurement
of consultancy
The aim of any rule is to provide a framework within which
an organization manages its business in a financially
prudent manner without compromising its flexibility to deal
with varied situations.
It is expected that the new GFRs 2017 will enable an
improved, efficient and effective framework of fiscal
management while providing the necessary flexibility to
facilitate timely delivery of services.
THANK YOU !