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					                                            AIR INDIA LIMITED
                                                                     Tender No. GH/CARGO/ORD/049

                                                                                            Page 1 of 51
                       TENDER FOR CARGO HANDLING AT CHICAGO (ORD)

Dear Handling Agent,




                    Sub: Cargo Handling at ORD International Airport, Chicago

Air India Limited solely at its discretion desires to award Ground Handling Agreement for
providing Cargo Handling for Air India flights at ORD International Airport, Chicago. As an
authorized Handling Company, we invite you to submit your offer for Cargo Handling services
for Air India flights at ORD International Airport in the format provided. Please note that you
should offer only those services for which you are the Authorised/Licensed Handling Company
by the Competent Authority.

      You are requested to submit your 'Sealed Offer' on or before June 06, 2011 by 1700
Hours through FedEx or UPS or in person at Airport Address: Air-India UL-220, Terminal 5,
O‟Hare Int‟l Airport, Chicago, IL 60666.


      Following Annexures are enclosed with this Tender Document.

      (a)   Annex I -         Information on estimated cargo load and warehouse
      (b)   Annex II -        Air India Flight Schedule
      (c)   Annex. IIA -      Service Level Agreement
      (d)   Annex III -       Services Required
      (e)   Annex IV -        Cargo handling services, Standards of Service Expected & Staffing
                              Requirements, procedures, Job requirements
      (f) Annex V -           Handling Company Profile
      (g) Annex VI -          Commercial Offer
      (h) Annex VII –         Integrity Pact Program.


       Your offer should be in "Two Separate Sealed Envelopes" as given below:


ENVELOPE - 1: "Handling Company Profile"-TECHNICAL OFFER

Please provide information regarding your Handling Company in general and your capability to
provide offered handling services at ORD International Airport in particular. Your response must
reply points mentioned in Annex III of this Tender document. In this response please specify the
services you intend to offer. “PLEASE DO NOT QUOTE RATES IN THIS ENVELOPE.”
                                            AIR INDIA LIMITED
                                                                        Tender No. GH/CARGO/ORD/049

                                                                                               Page 2 of 51
                       TENDER FOR CARGO HANDLING AT CHICAGO (ORD)

ENVELOPE -2: "COMMERCIAL OFFER"

Air India‟s requirement of services as per IATA AHM 810, 2008 version is specified in Annex
III. Please also refer Annex IV for Air India's standard of service expected and staff requirement
along with procedures and job requirements. Please submit your quotation as required in Annex
VI of this Tender Document.

It may please be noted that, both the sealed envelopes must be clearly super-scribed as stated
above and submitted before the due date. Responses received after the due date, time and
incomplete response are liable to be disqualified. Air India reserves the right to accept or reject
any bids at its own discretion.

The offers received will be opened on June 07, 2011 at 1000 hours local time in the office of
Airport Manager-Chicago in the presence of those bidders who are interested to be present.
Initially, the Technical offers (Envelope I) will be opened. Subsequently, the Commercial
offers (Envelope II) will be opened if possible for those bidders who meet Air India
requirements technically under Annex IV.

       If you require any clarifications, please contact:
       Mr. Aspi Irani, Airport Manager, Chicago, Air India.
       PHONE: (773) 686 1460 or fax no (773) 686 1461
       E-MAIL ADDRESS: airani@airindiausa.com



We shall appreciate if you confirm your participation in this tender.



                                                            (Airport Manager-ORD, AIR INDIA)
                                              AIR INDIA LIMITED
                                                                        Tender No. GH/CARGO/ORD/049

                                                                                               Page 3 of 51
                          TENDER FOR CARGO HANDLING AT CHICAGO (ORD)

                                                                                        ANNEX-I

                                         Estimated cargo Load


1.        Air India's Summer/Winter schedule, Ref Annex. II

     2.         Approx. quantum of cargo expected to be handled at ORD Per month.

                Export Cargo in tonnes                  Tonnes per month
                                      i) Revenue Cargo 500
          a)                         ii) Mail           2
                                    iii) COMAT         1
                                         TOTAL        503

                Import Cargo in tonnes

           b)                         i) Revenue Cargo 125
                                     ii) Mail/ Courier* .5
                                    iii) COMAT           2
                                         TOTAL          127.5


                       * Directly delivered by the Ramp Handling agent to the respective agency.
                                                  AIR INDIA LIMITED
                                                                         Tender No. GH/CARGO/ORD/049

                                                                                               Page 4 of 51
                       TENDER FOR CARGO HANDLING AT CHICAGO (ORD)
                                                                                        ANNEX – II
                             AIR INDIA FLIGHT SCHEDULE AT ORD

                             FLIGHT SCHEDULE EFFECTIVE MARCH 2011

            DAYS     FLGHT NO         STA/STD            A/C            SECTOR

           DAILY     AI127/126        0710/1445    777-300ER      HYD-DEL-ORD-DEL-HYD



NOTE:

        1. The Schedule provided above is for ORD effective March 2011. It may be clearly
           noted that Schedule are subject to change & intimation of the same will be provided
           with reasonable Notice.
        2. Any changes in schedule with reasonable notice will not be a ground for seeking any
           price escalation by Handling Agent.

        A/C configuration:       (Subject to change without notice)
                                 Passengers                     ULD Configuration\
                                 F      J          Y            Pallet Container
        B777-200LR               08     35         195          04        18
        B777-300 ER              04     35         303          06        24

Note:          Aircraft type and configuration - subject to change without notice.
                                            AIR INDIA LIMITED
                                                                        Tender No. GH/CARGO/ORD/049

                                                                                                Page 5 of 51
                        TENDER FOR CARGO HANDLING AT CHICAGO (ORD)

                                                                                       ANNEX II A
                              SERVICE LEVEL AGREEMENT
                                Attachment to Annex B ________
This SLA is made between the representatives of Air India Limited (the Carrier) and
______________________________ (the Service Provider) at the location ORD International
Airport, concerning service delivery standards for the technical handling services contracted
between the two parties. The service delivery standards outlined below are subject to the Carrier
operating on schedule and the factors being within the control of the Service Provider.
Reasonableness will be applied in the application of the standards.


The Service Provider is aware that the delivery of service standards shall not compromise safety
procedures.


The service elements outlined below are general and are based on prevailing industry standards.
They can be extended/reduced or added to as agreed between the parties considering factors such
as facilities available, infrastructure, type of aircraft operated etc. at the respective locations.

                                                             TARGET SERVICE LEVELS
   1.          GENERAL

               On Time Performance                                          100%
               (No delay acceptable to flight due to Cargo Handling)

    2.         CARGO

   2.1         Export

               Completion of building up ULD's/bulk cargo with              98%
               optimum utilization of space thereby maximizing
               load : D - 3 hrs

               Ensure cargo moves out from warehouse and is                 98%
               Transported under the Aircraft : D – 2.5 hrs

               Supervise and ensure smooth and timely loading of all
               the ULDs/bulk cargo, postal mail/CAT-A, VAL, etc.            100%
               on to the aircraft : D – 45 min.

               Confirm cargo load allocation from Load Control              100%
               (Traffic Office) : D-5 hrs.
                                          AIR INDIA LIMITED
                                                                      Tender No. GH/CARGO/ORD/049

                                                                                            Page 6 of 51
                       TENDER FOR CARGO HANDLING AT CHICAGO (ORD)


              Sending of Pre-alert Special Handling messages             100%
              To concerned stations : D – 3 hrs.

              NOTAC to be presented to the Captain D – 30 min.           100%

              Send FFM D + 1 hr                                          99%

              Ratio of cargo booking uplift                              100%
              (Service Provider to follow the procedures / steps
              as detailed in the attached Annexure IV, the standard of
              service expected and staff/job requirements
              and any other instructions issued by the Carrier)

   2.2        Import
              Despatch of cargo to warehouse ATA + 1 hr                  98%

              Examination of Import cargo A + 3 hrs                      98%
              (Service Provider to follow the procedures / steps
              as detailed in the attached Annexure IV, the standard
              of service expected and staff/job requirements,
              and any other instructions issued by the Carrier.)

   2.3        ULD

              UCM message Import - 3 hrs after ATA                       100%
              Includes discrepancy (improper loading,
              damage etc), tracing, missing units message

              Export - 01 hr after ATD                                   100%
              SCM message - weekly                                       100%

   2.4        Safety

               PER/DGR/AVI/HUM acceptance strictly as per                100%
              IATA regulation, Carrier‟s requirement and
              applicable local law


Non-Compliance of Service Norms

The handling agent will stand committed for providing satisfactory service for cargo handling in
terms of the Agreement. Any unsatisfactory service experienced or any service norm that is not
complied with will be addressed as follows:
                                          AIR INDIA LIMITED
                                                                     Tender No. GH/CARGO/ORD/049

                                                                                            Page 7 of 51
                         TENDER FOR CARGO HANDLING AT CHICAGO (ORD)


Step 1.       Air India will notify handling agent of any service level non-compliance noticed.

Step 2.       Handling agent will respond in writing giving their investigation and action taken
to            prevent recurrence.

Step 3.         In case of repeated non-compliance of Service Norms brought to handling
company‟s              notice, the Executive Head of the handling company will personally look
into the matter
                and take corrective steps within 03 days and advise Air India accordingly.

Step 4.       If the situation still does not improve and non-compliance of Service Norms
continue, the        handling company shall be levied with penalty of USD500 per default and
same shall be        deducted from the monthly invoice under advice to the Handling Agent.




Signed the                                 Signed the

At                                         At

for and on behalf of                       for and on behalf of Air India Limited
"the Service Provider"                     "the Carrier"
by                                         by
                                            AIR INDIA LIMITED
                                                                          Tender No. GH/CARGO/ORD/049

                                                                                             Page 8 of 51
                     TENDER FOR CARGO HANDLING AT CHICAGO (ORD)

                                                                                   ANNEX III

                                   SERVICES REQUIRED


Following services sections of Annex A of AHM 810 2008 version of Standard IATA Ground
Handling Agreement are required to be provided by the handling agent.


Cargo handling in the Handling Agents warehouse/facility

Section 1   -   1.1.1 to 1.1.4,
                1.2.1, 1.2.2, 1.2.3(f,g),1.2.4, 1.2.5,
                1.3.2,1.3.3,1.3.7,1.3.8,
                1.4.1(A), 1.4.7,1.4.8.

Section 4   -   4.1.1,
                4.2.1(maintain a message file containing messages pertaining to each flight for
                a minimum of 90 days), 4.2.2

Section 5   -   5.1.1 to 5.1.6,
                5.2.1,5.2.2,5,2.4
                5.3.1,5.3.2,5.3.3,5.3.4,5.3.5
                5.4.1,5.4.2,5.4.3(a),
                5.5.1,5.5.2,5.5.3,5.5.4,5.5.5,5.5.6,
                5.6.1 to 5.6.4
                5.7

Section 6   -   6.1.1
                6.2.2(a)(8),
                6.3.1, 6.3.2, 6.3.3(fortnightly reports), 6.3.4, 6.3.5,
                6.6.1(a)(3)(4)(b),


Section 7   -   7.2.1, 7.4.3(1),
                                          AIR INDIA LIMITED
                                                                    Tender No. GH/CARGO/ORD/049

                                                                                            Page 9 of 51
                     TENDER FOR CARGO HANDLING AT CHICAGO (ORD)

                                                                                   ANNEX IV
                     Handling of cargo in Handling Agent's Premises

For handling of cargo at ORD International Airport the following functions would have to be
performed by the Handling Agency.

Cargo Handling Services

1.    The Handling Company will provide cargo handling services as specified in Annexure III
      in their warehouse and provide necessary manpower, supervision services including
      dedicated Customer Service Agent as specified in point No.15. The job requirement is
      given in details below.

2.    The Handling Company should hold all warehouse equipment for handling the cargo at
      their cost.

3.    The handling company shall provide cooling units for storage of perishable shipments.

4.    The Handling Company will provide storage for the ULD's of the Carrier and will submit
      an inventory report on weekly basis to Air India personnel.

5.    The Carrier may display its signage and corporate logo on the Handling Company‟s
      facility.

6.    The Handling Company will ensure that all Govt. formalities like customs, health, safety
      labour and other mandatory requirements are complied with.

7.    Dangerous goods will be accepted by Handling Company's trained personnel in
      accordance with the latest edition of IATA DGR and Carrier's special instructions. The
      staff from the Handling Company performing these functions should hold valid
      certificate, periodically updated.

8.    Consumables for ULD build up of export cargo like skids, plastic cover, lashings etc. will
      be supplied by the Handling Agency and should be inclusive in the quoted rate.

9.    The Carrier will retain a charges collect fee of 5%.

10.   No extra charges shall be applicable for providing the services at night, or on Saturdays,
      Sundays or legal holidays.

11.   No extra charges shall be applied to the Carrier by the Handling Co., due to the
      cancellation of the carrier's flight informed 6 hours, prior to STA or due delay if any.
12.   The Handling Company will provide cargo screening equipments duly approved by TSA
      / BCAS and manned by trained and certified personnel for all cargo and mail.
                                          AIR INDIA LIMITED
                                                                    Tender No. GH/CARGO/ORD/049

                                                                                           Page 10 of 51
                      TENDER FOR CARGO HANDLING AT CHICAGO (ORD)
13.    All arrival/departure activities(warehouse functions) inclusive of ULD movements on AI
       flights to be completed on Air India's USAS cargo system. Air India will provide access
       to its system.
14.    For cargo destined to points beyond O‟Hare, onward flight/trucking details should be
       entered in the system.
15.    The Handling Agency will provide an office space of approx. 400 Sq. ft. including all
       utilities and cleaning and dedicated customer agents during normal working hours as
       indicated below. The Agents will handle enquiries, answer telexes, make arrangements
       for movement of special cargo and make bookings. The Customer Agents will function
       under the direction of Air India personnel.
16.    The terminal charges for export, import and transhipment consignments will be
       determined by market practice and will be charged with Air India concurrence.
17.   All special cargo such as VAL, PER, HUM, DGR, etc. either for Export or Import are to
      be escorted, treated and stored in accordance to the instructions of AWB, IATA, Customs
      & Security regulations.
18.   The Carrier will retain a fee, levied on issuance of DO (Delivery Order) on Import Cargo
      before the consignment is delivered.

      Security requirement

1.    The following will be the security requirement, which will be provided by the Handling
      Agent

       i)     Strong rooms for keeping the valuable cargo.
       ii)    Provision for storing of any odd size cargo, if any, requiring cooling off period.
       iii)   Premises should be safe guarded by trained personnel with modern security
              equipment. The selected cargo-handling agency, apart from following
              DTLR/TSA/BCAS procedures will also have to observe Air India procedures,
              which will be appraised to them.
       iv)    The Handling Agent will allow Air India security or its authorised agency to carry
              out their functions in the Handling Agents warehouse.
       v)     The Handling Agent should note that the Air India Security or its authorised
              agency would escort the cargo while transported to/from warehouse to Air India
              flight.


SPACE FOR COMAT HANDLING:
Minimum of 100 sq ft in segregated area with provision for flexible perimeter to accommodate
occasional oversized items and use of racking system to maximize storage area.


Standard of Service Expected and Staff Requirements: The common job requirements
applicable for export/import/flight handling tarmac coordinators/customer services unit and
comat handling are given in details as per below.
                                        AIR INDIA LIMITED
                                                                   Tender No. GH/CARGO/ORD/049

                                                                                             Page 11 of 51
                    TENDER FOR CARGO HANDLING AT CHICAGO (ORD)
1.   EXPORT / IMPORT HANDLING
       The Handling Agent will be required to deploy staff depending on volume of cargo
       each day, 365 days a year, for handling of Import / Export cargo besides some
       dedicated staff as indicated. The reporting pattern of these staff shall be discussed
       with Air India Officials prior to deployment as per flight schedule.

        Functions                                             Strength of Staff Required

    Imports & Exports / Loader-Unloader                                As required

    Customer Service Unit                                                      2
     (Mon – Fri office working hours 0900 to 1730 hrs)

    Import / Export Supervisor (Claims) (Managerial Level)                     1

    Flight Handling Coordinator - As per Flight Schedule               As required

    Supervisor to cover daily operations                               As required

           .
2.         All the staff / Supervisors should be employees on the payroll of the Company.
           The warehouse staff should be well trained and qualified to operate handling
           equipment.

3.         All staff of the Handling Company should have valid license for handling
           Dangerous Goods and meeting all IATA DGR requirements for handling of Air
           India export and import cargo.

4.         The Handling Agent will ensure that due care is taken for avoiding damage to the
           property. The Handling Agent will also comply with all local health and safety
           regulations and the security parameters as drawn and established by Air India. In
           addition, the Handling Agency shall also be solely responsible for strictly adhering
           to the Local and Federal Regulations.

5.         Continuity of staff (trained) in carrying out Cargo functions to be maintained.
                                        AIR INDIA LIMITED
                                                                    Tender No. GH/CARGO/ORD/049

                                                                                            Page 12 of 51
                   TENDER FOR CARGO HANDLING AT CHICAGO (ORD)

(A) JOB REQUIREMENTS – EXPORT CARGO

  1.    Receipt of cargo consignments in Air India warehouse, with all Regulatory Authority
        requirements and all other relevant documents to be checked by agent
        receiving/accepting the documents. The handling agent staff shall inspect cargo –
        condition, count and verify labeling in the presence of security.

  2.    Check and weigh consignment. If cargo is of valuable nature (silver, gold), Duty
        Manager or Duty Supervisor to be present during weighing operation. Correction if
        necessary to be made on the AWB.

  3.    Reading weight / charges etc., in the presence of the freight delivering agent.

  4.    Documents to be entered in the system for customs purpose, and assigned to the
        relevant flight as per the booking sheet, which will be given to the handling agent by
        Air India sales office every day.

  5.    Dangerous goods to be checked and DG cargo to be left/secured in the area
        designated for such cargo. The Handling Company should have a licensed staff to
        handle dangerous goods – Export / Import in accordance with the current IATA DGR
        and ensure that such a staff is made available for acceptance and handling of Air
        India cargo.

  6.    Ensure all security documentation's are in order, and if not, the same to be obtained
        from the exporter/agent by telephone/telefax/email in accordance with the applicable
        law. Also to ask for a copy of the TSA security letter as required by local laws.

  7.    All customs procedures to be processed, and ERL's to be delivered to customs as per
        customs requirement.

  8.    All efforts to be made for utmost utilization of the aircraft space available. This is to
        be done based on the booking sheets provided to the handler by Air India sales for
        east bound flight, and further through telephone calls, and finally completion upon
        receipt of final CPM. Post Office mail and company material also to be forwarded
        following the above yard sticks, with the ultimate objective for total utilization of the
        space available.

  9.    To produce a build sheet for the warehouse staff to build the ULD / loose
        accordingly.

  10.   The warehouse staff to act on the build sheet and advice the office staff, who in turn
        will prepare the final manifest depicting the ULD No. / loose cargo and the contents.
                                      AIR INDIA LIMITED
                                                                 Tender No. GH/CARGO/ORD/049

                                                                                          Page 13 of 51
                 TENDER FOR CARGO HANDLING AT CHICAGO (ORD)

11.   Supplementary manifest to be prepared to account for the last minute changes on the
      cargo cartage.

12.   Telex messages to be sent within 1 hour of departure of flight to all concerned (local,
      en route station and destination), regarding the joining load for the flight, with all
      dangerous goods details or special cargo handling details and any other required
      information.

13.   In case of payload / space restrictions, the cargo load to be adjusted and documents /
      computer to be updated accordingly.

14.   Requisite number of copies of air waybill manifests and tally sheets to be prepared
      for export and import cargo and forwarded on board for destination requirement and
      en route station(if required), and distributed to all concerned.

15.   AV7 postal mail copy to be collected by the handling agent from Authorities and
      brought back to the warehouse, which will be received by the warehouse staff. Bags
      to be checked against mail documents and x-rayed (if same being forwarded within
      24 hrs), and forwarded on the first available flight. Likewise Post Office mail
      delivered landside by the Postal authorities is received by warehouse staff and
      forwarded on the first available flight.

16.   Document M-1 to be raised after mail has been dispatched, copies of which to be
      forwarded to ORD Accounts and copy given to cargo coordinator.

17.   If any dangerous goods on board, then a NOTAC has to be prepared including copy
      of declaration and copy of relevant blue page from DG Book and produced to the
      Captain for his signature and obtain signed copy for Load Control Unit(LCU)/staff
      and flight record.

18.   All joining valuable / perishables on board to be advised to security and cargo co-
      ordinator in the morning.

19.   To send the telexes pertaining to flight departure, i.e. valuable cargo, diplomatic
      mail, perishable cargo, dangerous goods, trans-shipments, UCM and any other
      special handling. Also, if any cargo offloaded, intimation to be sent to destination.

20.   To give joining cargo/mail figures once flight has departed to traffic/LCU staff.

21.   To prepare manifest in FFM format after each flight departure.

22.   To provide backlog figures as and when required.
                                                 AIR INDIA LIMITED
                                                                          Tender No. GH/CARGO/ORD/049

                                                                                                 Page 14 of 51
                           TENDER FOR CARGO HANDLING AT CHICAGO (ORD)

     23.        Export Tracing: - Offloaded cargo, missing cargo etc. - At destination to do bond
                check, and relevant telexes to be sent to the various destinations until the cargo has
                been traced.

     24.        Execute export AWB and prepare transfer at source. TFM on behalf of Air India.

     25.        In case an AWB is used from strong room, the AVYS register must be filled.

     26.        To manifest and prepare documents for movement of cargo shipped by road.

     27.        To handle / reply to any claims received from agents.

     28.        For shipments booked and shipped at Air India office, charges are to be collected on
                daily basis and accounted in the export MAP with supporting documentation and also
                advise to Air India. Cash and checks collected, has to be handed over along with a
                copy of the AWB to Air India on daily basis. At the end of the month, the final MAP
                along with the documents has to be handed over to AI. In case of credit extended to
                any agency, invoice will be raised by the handling agent on daily basis and ensure
                collection and accounting of the money in the export map.

     29.        All the cargo booked through CASS agency and uplifted over ORD will be audited
                by AI and data entry to be done by the handling agent on a daily basis through
                software provided by AI.

(B) JOB REQUIREMENTS – IMPORT CARGO

1.         Import documents brought from the Air India flights, by Air India coordinator to be
           segregated into:

           a)      Imports for Chicago
           b)      Imports for trans-shipment.

2.         Chicago documents to be fed into the computer for the necessary customs clearance and
           AMS inputs completed.

3.         Trans-shipment documents also to be similarly fed into the computer for obtaining the
           necessary release note and transfer manifest for the ultimate destinations.

4.         To book onward cargo with relevant carrier and obtain confirmation.

5.         To arrange for transport to bring import cargo from the aircraft to warehouse and deliver.

6.         Arrange for transport to the receiving carrier's warehouse, on or in the close proximity of
           the airport of arrival of transfer cargo under cover of the transfer manifest.
                                           AIR INDIA LIMITED
                                                                     Tender No. GH/CARGO/ORD/049

                                                                                           Page 15 of 51
                      TENDER FOR CARGO HANDLING AT CHICAGO (ORD)

7.     To notify consignee or agent of the arrival of the shipment and record the same.

8.     Warehouse staff to offload the cargo from bulk lorries and ULD trucks, and then break
       down and / or empty ULD'S.

9.     One import manifest to be given to cargo warehouse supervisor to check the actual cargo
       arrival in the warehouse, and pieces to be checked against the manifest.

10.    On completion of the above, status one to be sent- FLIGHT REPORT / DISCREPENCY
       & TELEX TO BE SENT TO ORIGIN STATION/SECURITY.

11.    Arrange for collection of charges on 'charges collect' consignments as per the airway
       bills. Cash or check collections and accounts on daily basis and to be handed over to Air
       India. The collections has to be accommodated in the CC import map with supporting
       documentary and also a telex to the station of origin

12.    Arrange for collection of DO fees as applicable and shall prepare and issue Delivery
       Order to the consignee/agent, and provide a receipt copy of the DO for Air India record.
       Cash collections and accounts to be handed over to Air India on daily basis.

13.    Release cargo to the consignee or agent upon proper release by customs and other
       government agencies as required.

14.    Take action in accordance with applicable instructions when consignee refuses
       acceptance or payment, i.e. send telex to originating destination, with follow-up action.
       IRP to be raised and sent to point of origin.

15.    Any shipper built unit handed over to agent / consignee must be recorded, reflecting the
       identification number and Condition of the unit, and also to ensure that it is returned
       within 3 days in the same condition as and when handed out. In the event of loss or
       damage, the handling agent must inform Air India, who in turn will take necessary penile
       action against the agent / consignee.

16.    To report any damage on telex to originating station, and accordingly prepare damage
       report. The same to be stamped by security.

17.    All import tracing i.e. inbound missing cargo, insufficient addresses, no response from
       importer etc., and disposal instructions to be requested via telex by the handling agent.

 18.   To do bond check every week with a copy to Air India.

 19.   Trucks ex USA to be off-loaded by the warehouse staff, and transactions are to be treated
       as an import inbound flight, except copy 5 of the TI document is stamped by customs and
       should be filed.
                                            AIR INDIA LIMITED
                                                                       Tender No. GH/CARGO/ORD/049

                                                                                             Page 16 of 51
                       TENDER FOR CARGO HANDLING AT CHICAGO (ORD)

20.     Pallet stock inventory to be carried out every week, and SCM telex/email about the same
        to be sent to all concerned unit at Mumbai with a copy to ORDKZAI/ORDKGAI.

21.     The container inventory to be carried out every week and SCM telex/email about the

        same to be sent to all concerned unit at Mumbai with a copy to ORDKZAI/ORDKGAI.

22.     To handle / reply to any claims received from agents / shipper / consignee.

23.     If cargo mishandled/lost/damaged while in custody of the Cargo Handling agent, the
        Cargo Handling agent will be liable for the claim arising due same.

24.     MAIL HANDLING – Mail to be handed over to postal authority if required and number
        of bags and AV7s should be logged on a daily basis. Send report to Bombay Mail section
        along with receipted AV7s from postal authorities.

(C)     JOB REQUIREMENT - TRANSFER FUNCTIONS

  i.    DIP MAIL
             Imports
        a)   Prepare transfer manifest
              Prepare in-bond labels

        b)     All docs taken to Customs for approval and brought back to ensure all shipments
               transferred same day, if possible.

        c)     All shipments taken physically to respective airlines' warehouse with respective
               transfer manifest.


      ii. EXPORTS

               Receive transfer manifest from interline carrier/trucking company - check
               Airwaybills and customs approval and other docs.

      iii. COMAT

               Consignments for CAO transfer to foreign airlines - prepare transfer manifest and
               take each consignment to respective foreign airlines' warehouse for acceptance.

      iv. CARGO

               For Import consignments-book on telephone with respective airlines, type transfer
               manifest, and load on truck or physically take to interline carrier.
                                          AIR INDIA LIMITED
                                                                      Tender No. GH/CARGO/ORD/049

                                                                                             Page 17 of 51
                     TENDER FOR CARGO HANDLING AT CHICAGO (ORD)

             For Export - receive from trucking company/interline carrier, as normal shipment
             would be checked.


(D)   JOB REQUIREMENTS/ FLIGHT HANDLING - CO-ORDINATORS

  1. The flight coordinators to use the handling agency‟s airside transportation for attending
     flights.

  2. The flight coordinators on duty will function and report to Air India District Cargo Sales
     Manager / Air India flight coordinator.

  3. Check all freight that has been built for the flights and see if anymore allocation available
     from load control and then organize with warehouse staff and handling agent to build the
     extra ULD (pallet/containers) or Loose cargo for bulk load and pass weights to load
     control. Ensure all pallets and containers space is used to the maximum.

  4. To check if all documents/manifests are ready for the flight. If valuable cargo being
     accepted i.e. Gold, to be weighed in coordinators presence and ensured all documents to
     be amended.

  5. To check dangerous goods notification to captain (NOTAC) is made with all relevant
     copies attached.

  6. To advise Transport company, the quantum of load to pick up for the flight.

  7. To accept Cat A Bag (diplomatic bag) from Indian High Commission in the morning and
     manifest the same with copies for Accounts ORD & BOM and copies for flight purser
     and flight folder.

  8. Second coordinator to monitor all cargo leaves the warehouse in the correct position for
     easy on load straight onto the aircraft.

  9. All joining post office mail documents to be listed on daily basis with on forwarding
     details to post office on weekly basis.

  10. Attend incoming flight
      a)     Take over any Cat A Bag from the incoming Flight Purser.
      b)
      i)     To check for any valuable incoming cargo.
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                   TENDER FOR CARGO HANDLING AT CHICAGO (ORD)
   ii)     Load any joining valuable cargo in presence of security fill in valuable note.
   iii)    Ensure all valuable container cargo offloaded.
   iv)     Incoming Valuable cargo to be taken to warehouse and stored in strong room.
   v)      Valuable mail- bag to be personally handed over to post office and receive
           stamped copy.
   vi)     To ensure all pallets/containers/bulk cargo is correctly offloaded and same
           taken back to warehouse.

   c) Second coordinator to ensure Courier mail is offloaded and shifted/taken to Courier
      Facility.
   d) If any courier mail short-landed to send appropriated telexes.

11. See departure flight:

   i)      Hand over Cat A Bag joining / transit to Flight Purser.
   ii)     Load joining documents / manifest in Valuable container.
   iii)    See Captain with dangerous goods NOTAC and explain degree of danger of goods
           and position where same is loaded and once he is satisfied take signature on
           NOTAC. Give copy of NOTAC to In-flight Supervisor/First Officer and retain the
           same with flight departure report for office record.

12. Courier mail being accepted has to be X-rayed in coordinators presence by Security staff
    and each bag has to be tagged. Security letter has to checked and copy of tag attached
    same to be handed over to Security Manager. Bags to be picked up by Ramp agent to be
    monitored and taken to aircraft and then loaded and advise all concerned regarding
    weight to load control. Send telex after departure.

13. In regards to incoming mail on flights from India for ORD / onward destinations, the
    second Coordinator to go to post office with Ramp agent driver to ensure all ORD bound
    mail is delivered and documents stamped by Post Office and all onward destined mail to
    be taken to various airlines and handed over by the coordinator. After receiving stamped
    mail docs M2 to be made (a list of all bags) and forwarded to Bombay Mail Shed with
    copy in our flight folder.

14. After flight departure all flight handling reports to be completed. All on-load / offload
    cargo figures to be passed to Air India load control, ORD and to Mumbai by telex. All
    valuable / Cat A Bag / joining mail / AOG / Human Remains telexes to be sent. Pallet in/
    out inventory to be kept on daily basis and forward to Mumbai on fortnightly basis. Keep
    register of every flight in and out with all revenues /stores/mail figures on daily basis.

15. Handover on daily basis to Air India copies of

           i)      Import/Export manifest and airway bills
           ii)     Import/Export cash maps and bank deposit slips
                                            AIR INDIA LIMITED
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                        TENDER FOR CARGO HANDLING AT CHICAGO (ORD)




 (E)     JOB REQUIREMENTS - CUSTOMER SERVICES UNIT

1.       To handle all inquires, answer telexes, make arrangement for movement of special cargo
         and make bookings. Pre-alert telexes for cargo needing special attention to be sent to
         concerned stations. Maintain records for export shipments including filing of CTM. Sort
         out discrepancies pertaining to export / import consignments. The customer Services Unit
         will function under the direction of Air India Personnel.

         Functions to be performed:

 1.      Post flight computer action on every consignment – freight delivered.
 2.      Import notification – by telephone / fax.
 3.      Telephone queries.
 4.      Cargo bookings.
 5.      Tracing – mishandled cargo, short-shipments.
 6.      Flight details/arrival details for export/import shipments.
 7.      Handle General cargo rates ( TACT ) enquiries.
 8.      Miscellaneous queries – Storage charges, documentation, special handling of cargo etc.
 9.      Postal mail statistics – AV7 statement made for every flight for BOM mail office.
 10.     Auditing of flight – check air waybills for correctness of weight, dimensions, PER clause
         and other fields.
 11.     Feed Cargo I statistics.
 12.     Issue CCAs.
 13.     Cover for other staff for lunch hour / vacation.

         Supervisor‟s additional functions:
      1. Cargo Claims – export and import.
      2. Special customers/cargo requirements/projects.
      3. Handling of all queries from Indian missions regarding export, import, diplomatic mail
         etc.
      4. Maintenance of building / equipment including repairs.
      5. All correspondence pertaining to customer service.

(F)      JOB REQUIREMENTS - COMAT HANDLING

1.      General COMAT Functions: Handling of all Company material transported by the
Carrier. Coordinate with Regional Materials Manager –(R-MMD) office for movement of
COMAT/AOG/Critical company consignments.

General Functions to be performed:
                                            AIR INDIA LIMITED
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                        TENDER FOR CARGO HANDLING AT CHICAGO (ORD)
         Answer all faxes / telexes giving required / requested information.
         Find all designated A.O.G.‟s critical, work stoppage consignments and assign them to Q
          Notes / air waybills.
         Resolve all discrepancies regarding unpaid invoices ( i.e. find relevant Q Notes / air
          waybills.
         Fax or mail requests for invoices / correct P.O. numbers or any other discrepancy to
          MMD and match same when received.
         Send reminders for same, if not received.
         Book Air India cargo A/C only freight. Obtain booking rate and tariff information.
         Send for C.O.D. payments from MMD.
         Keep a copy of payment cheques, if received.
         If consignment returned due no payment, keep copy of slip / return date.
         Return all consignments to vendor requested by MMD.
         Notify parties of COMAT / import P/U‟s.
         Give local P/U for COMAT / imports.
         Maintain trucking receipts, Q Note / air waybill files etc.
         Send freight for repacking.
         Answer telephone requests.


2.        COMAT EXPORTS - 1

       As regards COMAT, the handling agency is required to carry out exactly the same
functions as for any Commercial Export shipment, with the difference that the making of the
AWB and the labeling of all packages are done by Air India. For all purposes, it is exactly the
same as any Commercial shipment. The functions are - acceptance, documentation, computer
feeding of data, labeling, handling of AOG including DG COMAT consignments, transferring of
inbound COMAT consignments to final destination, maintaining a record of outbound/inbound
COMAT. To liaise with RM-MMD for uplift of AOG/DG COMAT consignments.

          Functions to be performed:

     1.          Freight received from UPS / FEDEX / other carriers.
     2.          Load / store freight into bins according to date / section for delivery.
     3.          Feed details of each shipment into computer to obtain Q Note / air waybill.
     4.          Label freight (COMAT number / AOG / Must GO, etc.)
     5.          Prepare paperwork for export – copies to destinations, MMD and cargo office.
                                               AIR INDIA LIMITED
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                          TENDER FOR CARGO HANDLING AT CHICAGO (ORD)


3.         COMAT IMPORTS - 2

       The prospective tenderers to advise if they have the necessary facilities for the customs
clearance of imports. In brief, the COMAT shipments are like any other commercial cargo
shipments except that the documentation and labeling is done by Air India themselves.

           Functions to be performed:

     1.       Prepare / Type 3311 customs forms with copies for customs.
     2.       When COMAT consignment cleared by customs, match custom papers with tally.
     3.       Make labels for each consignment and attach same.
     4.       Deliver to UPS / FEDEX / other approved carrier.
     5.       Prepare paper work for information of MMD.
     6.       Answer all telex correspondence requesting for forwarding information from Mumbai
              /MMD / Engineering.


                  General Cargo Handling Specifications

      1.          Liaise with local authorities.
      2.           Indicate the Handling Company is acting as handling agent for Air India.
      3.          Dispatch and receive all messages in connection with the services performed by
                  the handling company, using Air India originator code, as applicable.
      4.          Maintain a message file containing all above-mentioned messages pertaining to
                  each flight.
      5.          Maintain clean, well-lighted facilities for handling of cargo. Protecting cargo from
                  unauthorized access and weather.
      6.          Take appropriate action to prevent theft of, or damage to, cargo.
      7.          Ensure safe operation of all equipment in facility.
      8.          Provide acceptance/certification check for all dangerous goods to be handled per
                  existing procedures and regulations applicable to Air India.
      9.          Obtain receipt upon delivery of cargo.
      10.         Maintain all files (e.g. security, dangerous goods, live animal, human remains,
                  mail etc) in accordance with Air India and regulatory requirements.
      11.         Check all documents to ensure shipment may be carried in accordance with Air
                  India‟s and all applicable regulatory requirements.
      12.         Place cargo under Customs‟ control, if required, and clear discrepancies in
                  accordance with local regulations.
      13.         Present to Customs, as required, cargo for physical examination.
      14.         Take immediate action in accordance with Air India‟s and/or local authorities‟
                  instructions in respect of irregularities, damage or mishandling of dangerous
                  goods and special cargo shipments. Set up inspection services as required.
                                 AIR INDIA LIMITED
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             TENDER FOR CARGO HANDLING AT CHICAGO (ORD)
15.   Report to Air India any irregularities discovered in cargo handling.
16.   Research and resolve air waybill discrepancy reports.
17.   Handle lost, found and damaged cargo matters, as mutually agreed. (Repair or
      repackage damaged containers/cartons for further carriage.)
18.   Notify Air India of complaints and claims, giving supporting data.
19.   Resolve customer complaints at first point of contact within established
      guidelines.
20.   Non-delivery notices must be completed and mailed for unclaimed shipments.
21.   Take action in accordance with applicable instructions when consignee refuses
      acceptance or payment.
22.   All import short shipments, damages and short landings must be telexed to the
      origin and transit stations and a proper short shipment and / or damage report
      filled out.
23.   All irregularities must be remarked and updated for quick response.
24.   Balance actual daily collections.
25.   Deposit collections in Air India account and maintain record.
26.   Collect all required collections documentation for forwarding to Accounting
      Office.
27.   Handle company mail, as mutually agreed.
28.   All Stationary such as U.S. Customs clearing documents for import and export to
      be provided by handling agent as per industry practice. For example carrier
      certificates, inbound transfer documents etc.
29.   Handling Agent should provide his own Internet access and computer to comply
      with U.S. Customs AMS Regulations and submission of export declarations for
      comat.
30.   Cleaning of the office premises provided to AI should be arranged and provided
      by the handling agency.
                                          AIR INDIA LIMITED
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                      TENDER FOR CARGO HANDLING AT CHICAGO (ORD)

                                                                                    ANNEX. V

                            HANDLING COMPANY PROFILE

Please furnish the following information and other relevant information pertaining to your cargo
handling company in general and your facility and capability at ORD International Airport in
particular covering the following aspect:
Please provide specific answers to each of the following points of this annexure.
Response should be sealed and submitted in a separate envelope clearly marked "Handling
Company Profile". Please do not quote price in this envelope.

   1. Name, Address, Contact Tel No., Fax No., E-Mail address, etc.

   2.   Please submit a brief resume of cargo handling company. Please confirm that your
        Handling Company has minimum 03 years of Cargo Handling experience at Chicago.

   3. Warehouse space held presently with location address at Chicago.

   5 Please confirm that you will be able to meet all staffing, service levels and handling
     procedural requirements as given in Annex IIA, Annex III and Annex IV.

   6 Please give brief description of resources in terms of manpower and cargo handling
     equipment and warehouse facility held at ORD International Airport. Please specify that
     the manpower held by you are sufficiently trained in cargo handling/warehouse activity
     and that they hold authorized and valid DGR approval/certification.

   7 Please state if you hold all necessary handling equipment for cargo handling and that you
     will be in be positioning the equipment as per list given in Annex IA, in the warehouse
     for handling Air India cargo.

   8 Please specify airlines handled for cargo at Chicago by you.

   9 Cargo handling Company's approximate financial turnover and tonnage handled annually
     - by way or providing cargo handling services at Chicago.

   10 Whether members of IATA Clearing House.

   11 Contact person for Air India for this tender, with contact address and telephone numbers,
      and brief resume of person, with whom Air India will deal on a day-to-day basis, if the
      contract is awarded to you.

   12 Please confirm that your company is an approved / licensed handling agency by
      Competent Authority, ORD, for services offered by you.
                                         AIR INDIA LIMITED
                                                                     Tender No. GH/CARGO/ORD/049

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                    TENDER FOR CARGO HANDLING AT CHICAGO (ORD)


13 Please confirm that you will comply with all requirements under local laws / rules related
   with health and safety, labour, TSA, FAA and any other applicable regulations.

14 Please give details of training set-up related to cargo handling activities for your staff.
   Necessary Carrier‟s specific training as decided by Air India will be provided for which
   no reimbursement will be made to the Handling Agent by the Carrier for deputing their
   staff to undergo the same. Please confirm if the same is acceptable to your company.

15 Please confirm that the Liability and Indemnity as per Article 8 & 11 of IATA SGHA
   2008 version and Termination clause with 60 days notice from either side, is acceptable
   by you.

16 Please confirm that there will be no escalation in the handling charges in case of change
   in schedule of operations.

17 Please give the details of staff held in the following categories and flight details:
          a)


                                   No of Staff employed
       Managerial
       Skilled
       Unskilled

           b)      No. Of simultaneous wide-bodied flights you can handle at Chicago.
                   No. of flights that you will be required to handle when Air India flights are
                   on ground - Please specify Day wise position.
           c)      Please provide information on airlines presently handled by you at
                   Chicago
18 GHA will be executed in the form of Annex B simplified version of IATA SGHA,
   January 2008. The service standard required and procedures enumerated in Annex IV
   and Service Level agreement including the penalty clause as prescribed in Annex II A
   will form part of the GHA. Please confirm the same is acceptable to you.

19 Please confirm that resource requirements, procedures and job requirements as given in
   Annex IV will be complied with.

20 Please confirm Area offered to Air India for the following:
       a) Office Space ---
       b) Space for X-ray machine-
                                        AIR INDIA LIMITED
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                    TENDER FOR CARGO HANDLING AT CHICAGO (ORD)

        c) Secured warehouse space for Cargo Cooling-
        d) Warehouse space for COMAT -

21 The Handling Company will be deemed technically qualified based on the evaluation
   criteria given below, for which the minimum qualifying points will be 10. The
   commercial offer of only technically suitable parties will be opened.

EVALUATION CRITERIA

a) Minimum points to be obtained to qualify for the final Evaluation process is Ten(10).

b) The term “Ground Handling Services” means Cargo Handling only meeting all
requirement of „IATA Standard Ground Handling Agreement‟ Annex “A” (January 2008).

REQUIREMENT GRADING
 (in Points)
i. Number of years in the business of providing Cargo Handling services for Passenger flights

Less than 3 years will not be considered.
3 to 5 years –    1 point
6 to 9 years –    3 points
10 years & above – 5 points
ii. Number of airports where you have Cargo Handling Set up
One airport –       1 point
2 to 5 airports -   2 points
6 to 9 airports -   3 points
10 airports –       5 points
& above
iii. Total number of client airlines to which you are providing Cargo Handling services at the
airports of your operation.
Less than Three (03) client airlines will not be considered.
03 to 05 clients – 1 point
06 to 10 clients – 2 points
11 to 15 clients – 3 points
16 to 20 clients – 4 points
21 & more clients – 5 points

iv. On how many flights you had provided Cargo Handling services annually. Please provide
maximum numbers of flights handled by you during the year 2009 at any single airport of
your operation. Indicate the name of the airport.
                                       AIR INDIA LIMITED
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                   TENDER FOR CARGO HANDLING AT CHICAGO (ORD)


Less than Five Hundred (500) flights annually at any single airport of your operation will not
be considered.

500 – 1000 flts. – 1 point
1001 -2000 flts. – 2 points
2001 -3000 flts. – 3 points
3001 -5000 flts – 4 points
5001 & above – 5 points

v. Number of airlines conventional & wide-bodied handled at the same time

Less than Two (02) airlines for wide-bodied annually at airport of your operation will not be
considered.
02 – 04 airlines. – 1 point
05 - 09 airlines – 2 points
10 - 15 airlines. – 3 points
16 -20 airlines – 4 points
21 & above – 5 points

vi. Number of Accreditations / Certifications/Approvals for Cargo Handling services held by
you.

One – 1 point
Two – 2 points
Three – 3 points
Four – 4 points
Five – 5 points
& above

vii. The Annual Turnover of the Company in USD less than USD 0.5 million turnover will
not be considered

0.5 to USD 2 millions - 1 point
More than 2 to USD 4 millions - 2 points
More than 4 to USD 6 millions – 3 points
More than 6 to USD 8 millions – 4 points
USD 8 millions and above – 5 points

Response to be signed by Authorized Signatory with company Seal
22 Please do not quote price in response to this Annexure
                                             AIR INDIA LIMITED
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                        TENDER FOR CARGO HANDLING AT CHICAGO (ORD)

      23 The following para to be included in the GHA, which is mandatory.

         "It is expressly understood and agreed by and between (the corporation) and Air India
         Limited (the Indian PSU) that Air India Limited (the Indian PSU) is entering into this
         agreement solely on its own behalf and not on behalf of any other person or entity. In
         particular it is expressly understood and agreed that the Government of India is not a
         party to this agreement and has no liabilities, obligations or rights hereunder. It is
         expressly understood and agreed that Air India Limited (Indian PSU) is an independent
         legal entity with power and authority to enter into contracts solely in its own behalf under
         the applicable laws of India and general principles of Contract Law. The (Corporation)
         expressly agrees, acknowledges and understands that Air India Limited. (The Indian
         PSU) is not an agent, representative or delegate of the Government of India. It is further
         understood and agreed that the Government of India is not and shall not be liable for any
         acts, omissions, commissions, breaches or other wrongs arising out of the contract.
         Accordingly, (Corporation) hereby expressly waives, releases and forgoes any and all
         actions or claims, including cross claims, impleader claims or counter claims against the
         Government of India arising out of this contract and covenants not to suit the
         Government of India as to any manner, claim, cause of action or things whatsoever
         arising of or under this agreement.

24.      Air India is committed to fostering the most ethical and corruption free business
         environment. AI values its relationships with all Counterparts and deals with them in a
         fair and transparent manner. Air India is implementing the Integrity Pact Program in
         cooperation with Central Vigilance Commission (CVC) in respect of all contracts of the
         value of Rs.10 crores and above. The Vendors would sign the Pact and submit it along
         with the financial and technical bids. The Integrity Pact Program is attached as Annex-
         VII.

25.      Please confirm whether above is acceptable to you and you agree to include in the GHA
         to be executed. This is our mandatory legal requirement. Therefore, it forms the part of
         the GHA.

26.      Please confirm that there will be no escalation in handling charges in case of change in
         schedule of operations.

27.      Please confirm that you can commence to provide services effective immediately.

28.      Please give location and address of your warehouse at the airport.

29.      PLEASE DO NOT QUOTE PRICE IN RESPONSE TO THIS ANNEXURE

                                                                      Signed by Authorized
                                                                      Personnel
                                      AIR INDIA LIMITED
                                                                 Tender No. GH/CARGO/ORD/049

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                 TENDER FOR CARGO HANDLING AT CHICAGO (ORD)


            CRITERIA FOR SELECTION OF HANDLING AGENTS

         The Handling Company will be selected based on the following criteria:

1)   The Handling Agency should be approved/licenced by FAA/TSA and Airport
     Authority for providing cargo-handling services at O‟Hare.

2)   Experience of minimum 3 years as Cargo Handling Agent at Chicago.

3)   Agency must confirm to commence cargo-handling services for Air India flights
     immediately failing which their offer will be rejected.

4)   Agency to execute GHA as per standard IATA 2008 version with indemnity and
     termination clause.

5)   Agency to confirm that they will execute SLA with respective penalty clauses and will
     perform part of GHA.

6)   The period of contract will be 3 years and the rates to be quoted accordingly.
                                            AIR INDIA LIMITED
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                       TENDER FOR CARGO HANDLING AT CHICAGO (ORD)


                                                                                        Annex VI
                                   COMMERCIAL OFFER

Please respond to each of the following points with specific answers having taken into
consideration the following provided with the tender document:
1.     Annexure I,
2.     Annexure II, IIA
3.     Annexure III
4.     Annexure IV
5.     Annexure V

Duly signed response by your authorised signatory should be submitted in a sealed
envelope marked clearly "Commercial Offer" .

        1. Quote rate for Surface Transportation/Trucking between Chicago to EWR and EWR to
        Chicago on per kg and per Ton basis.

        2. Specify any conditions, limitations, restrictions, surcharges, etc if applicable on your
        quotations. Also specify application of taxes if included / excluded.

        3. Please quote charges for handling Air India Cargo- Import and Export, COMAT &
        Mail, for a contract period of Three Years, in the format given below

                                            In Handling agency‟s     Taxes/levies/Additional
                                            Warehouse                charges applicable if any
Handling charges for Import and Export
                                            USD _______ per Kg
 Cargo of up to 400 tons per month.
Handling charges for Import &Export
                                            USD _______ per Kg
Cargo, of up to 500 tons per month
Handling charges for Import & Export
                                            USD _______ per Kg
 Cargo of up to 600 tons per month

    4      Terminal Handling & Storage Charges - Handling at Handling Agent's warehouse
           The terminal charges for export, import and transhipment consignments will be
           determined by market practice and will be charged with Air India components.
           Government of India shipments and COMAT should be exempt from terminal and
           storage charges.

    5    Mail handling – charges:             USD per Kg of mail handled.
    6    Service freight handling (COMAT)
         Please indicate separate rate for import/export of COMAT (Non-revenue Cargo)
                                            AIR INDIA LIMITED
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                         TENDER FOR CARGO HANDLING AT CHICAGO (ORD)

     7       Please indicate BUP charges per ULD

                                                                                   Annex-VII

                               INTEGRITY PACT PROGRAM


I.   INTRODUCTION

         Air India Limited (AI) is a premier Public Sector airline (formed with the merger of
         the erstwhile Air-India and Indian Airlines) engaged in air transportation of
         passengers and cargo in India and abroad. The brand name of the Company is AIR-
         INDIA and it conducts its business by benchmarking itself to the highest ethical
         standards, and adopting the best practices followed by the industry.

         It does business with a number of domestic and international Bidders, Contractors
         and Vendors of goods and services (Counterparties). AI is committed to fostering the
         most ethical and corruption free business environment. AI values its relationships
         with all Counterparts and deals with them in a fair and transparent manner.

         In order to achieve these goals, AI is implementing the Integrity Pact Program in
         cooperation with Central Vigilance Commission (CVC) in respect of all contracts of
         the value of Rs.10 crores and above. As a part of this initiative, AI will, in
         consultation with CVC, appoint external Independent Monitors who will help AI in
         implementing the Integrity Pact Program. The Integrity Pact would be signed by the
         Principal and the Vendor at the pre-tendering stage itself, and will form part of the
         Tender document. A pre-signed Integrity Pact by the Principal would form part of the
         Tender document. The Vendors would sign the Pact and submit it alongwith the
         financial and technical bids.

         The ingredients of AI‟s Integrity Pact Program are broadly based on: -



         -        Commitments and Obligation of Air India and its employees
         -        Commitments and Obligation of Counterparties
         -        Violation and Consequences
         -        Independent Monitor
         -        Implementation Guidelines
         -        Role of Independent Monitors.




II. COMMITMENTS AND OBLIGATION OF AI

         a. AI is committed to have the most ethical and corruption- free business dealings
            with its Counterparties.
                                         AIR INDIA LIMITED
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                      TENDER FOR CARGO HANDLING AT CHICAGO (ORD)


     b. AI values its relationship with all Counterparties and will deal with them in a fair
        and transparent manner.

     c. AI and/or its Associates (employees, agents, consultants, advisors, etc.) will not
        seek or take bribes / undue benefit directly or indirectly for themselves or for
        third parties.

     d. In a competitive tender as well as in general procurement, AI will deal with all
        Counterparties with equity, reason and fairness.

     e. AI will exclude all Associates who may be prejudiced or have a Conflict of Interest
        in dealings with Counterparties.

     f.    AI will honour its commitments and make due payments to Counterparties in a
          timely manner.

     g. AI will initiate action and pursue it vigorously whenever corruption or unethical
        behavior occurs.

III. COMMITMENTS AND OBLIGATIONS OF THE „COUNTER-PARTY‟

     a. The Counterparty, directly or indirectly (through Agent, consultant, advisor, etc.),
        will not pay any bribes or give illegal benefit to any one to gain undue advantage
        in dealing with the Principal, AI.

     b. The Counterparty will not engage in collusion, Price-Fixing, etc. with other
        Counterparties in dealing with the Principal, AI.

     c. The Counterparty will not pass on to any third party any of the Principal‟s
        confidential information unless authorized by the organization.

     d. The Counterparty will promote and observe best ethical practices within its
        organization.

     e. The Counterparty will inform the Independent Monitor:

             i.   If it receives demand for a bribe or illegal payment/benefit and

             ii. If it comes to know of any unethical or illegal practice in the Principal‟s
                 organization (AI)

             iii. If it makes any payment to any of AI‟s Associates.

     f.    The Counterparty will not make any false or misleading allegations against AI or
          its Associates.
                                        AIR INDIA LIMITED
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                     TENDER FOR CARGO HANDLING AT CHICAGO (ORD)


IV. VIOLATIONS & CONSEQUENCES

     a. If a Counterparty commits a violation of its Commitments and Obligations under
        the Integrity Pact Program during the bidding process, it shall be liable to
        compensate AI by way of Liquidated damages amounting to a sum equivalent to
        3% of the value of the offer or the amount equivalent to Earnest Money
        Deposit/Bid Security, whichever is higher or an amount determined by the
        Independent Monitor.



     b. Incase of violation of the Integrity Pact whereby after award of the Contract the
        Principal (AI) terminates or is entitled to terminate the Contract, AI shall be
        entitled to demand and recover from the Contractor liquidated damages
        equivalent to 5% of the contract value or the amount equivalent to Security
        Deposit/Performance Bank Guarantee, whichever is higher or an amount
        determined by the Independent Monitor.

     c. AI may ban and exclude the Counterparty from future dealings until the
        Independent Monitor is satisfied that the Counterparty will not commit any future
        violation.

     d. AI may initiate criminal proceedings         against   the    violating   Counterparty,
        depending on the gravity of the violation.

     e. In case there is a violation of the Integrity Pact by the Principal (AI) or its
        Associates (i.e. employees, agents, consultants, advisors, etc.), AI undertakes to
        take appropriate action against them.

     f.   If the complaint made by a counter-party is found to be frivolous or mischievous,
          action in the form of certain sanctions would be taken against the said
          complainant.


V. INDEPENDENT MONITOR

1.   Chairman & MD, AI, is the authority to appoint Independent Monitor(s) to oversee
     the implementation and effectiveness of the Integrity Pact Program. The process for
     their appointment shall be similar to Outside Expert Committee (OEC). For this
     purpose, AI may constitute a panel of Independent Monitors and the same may be
     referred to CVC for clearance.

2.   The Independent Monitor will be a person of Impeccable Integrity, Knowledgeable of
     AI‟s business and experienced in commercial activities.

3.   It will be a voluntary, non-salaried position of 3 years terms. Independent Monitor
     will have stature /benefits similar to those of Chairman of the Audit Committee of
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      Board/status of the Directors of AI. The remuneration and perquisites would be
      similar to the remuneration/perks of independent Directors on the Board of AI.

4.    The main objective of the Independent Monitor will be to oversee the implementation
      of the Integrity Pact Program, to prevent corruption, or any other unethical practices
      in the implementation of the contract.

5.    The Independent Monitor will not have administrative or enforcement responsibilities.
      He will coordinate his efforts through the CVO or other anti-corruption institutions
      such as CVC. (He may engage services of outside agencies such as accounting
      firms, law firms, etc at AI‟s expense, if required, in discharge of his responsibilities
      after obtaining the approval of the Chairman & M.D.)

6.    The Independent Monitor will have access to all offices and internal records of the
      Principal in respect of the Tender in question. He will also have access to
      Counterparties‟ records and information regarding its dealing with the Principal.

7.    The Independent Monitor will have the right to attend any meetings between the
      Principal and the Counterparties. As far as possible, the meetings should be
      scheduled in India. In respect of any meeting to be held outside India, attendance by
      the Independent Monitor would be decided in consultation with the Chairman & M.D.,
      AI.

8.    If the Independent Monitor observes or suspects an irregularity, he will inform the
      Chairman of AI. Once the Independent Monitor is satisfied that any irregularity has
      taken place, he may also inform the CVO and CVC.


VI. IMPLEMENTATION GUIDELINES

To implement the Integrity Pact Program, the following general Guidelines are suggested:


      a. To select and appoint a Panel of Independent Monitors in consultation with the
         CVC.

      b. To get commitment from all Senior Level executives/officials of AI to implement
         the program. It should be recognized that there may be resistance to Integrity
         Pact program.

      c. To develop detailed implementations plans and finalize the Integrity Pact
         document in consultation with the Independent Monitors.

      d. To notify all senior staff members, Board of Directors, any other over-sight body
         of the Organization and major suppliers of AI‟s plans to implement Integrity Pact
         program, which is to be Included in AI‟s web site and also disclose this initiative
         to the media.
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VII.   PERIODIC REVIEW & EVALUATION

       It is recommended that the Board of Directors of AI periodically review the

effectiveness of Integrity Pact Program by all or some of the following measures: -


1.     The Independent Monitors and senior leadership of AI do an annual self-assessment
       of Integrity Pact Program effectiveness and identify areas / ways to improve the
       same.

2.     The Independent Monitor will submit an annual report on the progress / effectiveness
       of Integrity Pact Program to the Board of Directors of AI.

3.     AI may conduct an annual 360-degree review (through an outside agency, if
       required) with senior executives, junior executives, suppliers, and competitors,
       regarding the effectiveness of the Integrity Pact Program in reducing corruption.
       Feed-back may be taken from the junior and senior executives of the Principal,
       suppliers and competitors.

4.     AI should meet with CVC on an annual basis to review the effectiveness of the
       program.
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                                     INTEGRITY PACT


                                           Between
Air India Limited (AI) hereinafter referred to as “The Principal”,
                                              and

                            hereinafter referred to as “The Bidder/ Contractor”


                                         PREAMBLE


The Principal intends to award, under laid down organizational procedures, contract(s) for
                             .The Principal values full compliance with all relevant laws of the
land, rules, regulations, economic use of resources and of fairness/transparency in its relations
with its Bidder(s) and/or Contractor(s).

In order to achieve these goals, the Principal will appoint an Independent External Monitor
(IEM), who will monitor the tender process and the execution of the contract for compliance
with the principles mentioned above.

Section 1     – Commitments of the Principal

1. The Principal commits itself to take all measures necessary to prevent corruption and to
   observe the following principles:-

       a. No employee of the Principal, personally or through family members, will in
          connection with the tender for, or the execution of a contract, demand, take a
          promise for or accept, for self or third person, any material or immaterial benefit
          which the person is not legally entitled to. The word „take‟ shall also include the
          past and future.

       b. The Principal will, during the tender process treat all Bidder(s) with equity and
          reason. The Principal will in particular, before and during the tender process,
          provide to all Bidder(s) the same information and will not provide to any Bidder(s)
          confidential/additional information through which the Bidder(s) could obtain an
          advantage in relation to the tender process or the contract execution.

       c. The Principal will exclude from the process all known prejudiced persons and
          persons who would be known to have a connection or nexus with the prospective
          bidder.

2. If the Principal obtains information on the conduct of any of its employees which is a
   criminal offence under the IPC/PC Act or the conduct rules of the Principal, or if there be
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   a substantive suspicion in this regard, the Principal will inform the Chief Vigilance Officer
   and in addition can initiate disciplinary actions.

Section 2 – Commitments of the Bidder(s)/ contractor(s)

1. The Bidder(s)/ Contractor(s) commit themselves to take all measures necessary to
   prevent corruption in their dealings with AI. He commits himself to observe the following
   principles during his participation in the tender process and during the contract
   execution.

    a. The Bidder(s)/ Contractor(s) will not, directly or through any other person or firm,
       offer, promise or give to any of the Principal‟s employees involved in the tender
       process or the execution of the contract or to any third person any material or other
       benefit which he/she is not legally entitled to, in order to obtain in exchange any
       advantage of any kind whatsoever during the tender process or during the execution
       of the contract.

    b. The Bidder(s)/Contractor(s) will not enter with other Bidders into any undisclosed
       agreement or understanding, whether formal or informal. This applies in particular
       to prices, specifications, certifications, subsidiary contracts, submission or non-
       submission of bids or any other actions to restrict competitiveness or to introduce
       cartelisation in the bidding process.

    c. The Bidder(s)/Contractor(s) will not commit any offence under the relevant IPC/PC
       Act; further the Bidder(s)/ Contractor(s) will not use improperly, for purposes of
       competition or personal gain, or pass on to others, any information or document
       provided by the Principal as part of the business relationship, regarding plans,
       technical proposals and business details, including information contained or
       transmitted electronically.

    d. The Bidder(s)/Contractors(s) of foreign origin shall disclose the name and address of
       the Agents/representatives in India, if any. Similarly the Bidder(s)/Contractors(s) of
       Indian Nationality shall furnish the name and address of the foreign principals, if
       any. Further details as mentioned in the “Guidelines on Indian Agents of Foreign
       Suppliers” shall be disclosed by the Bidder(s)/Contractor(s). Further, as mentioned
       in the Guidelines all the payments made to the Indian agent/representative have to
       be in Indian Rupees only. Copy of the “Guidelines on Indian Agents of Foreign
       Suppliers” is placed at (Page nos. 6-7)

    e. The Bidder(s)/Contractor(s) will, when presenting his bid, disclose any and all
       payments he has made, is committed to or intends to make to agents, brokers or
       any other intermediaries in connection with the award of the contract.

    f. This integrity pact shall override the confidentiality clause, if any, in the offer
       submitted by the Contractor/Bidder and in the agreement entered into by the
       Principal with the Contractor/Bidder.

2. The Bidder(s)/Contractor(s) will not instigate third persons to commit offences or acts
   outlined above or be an accessory to such offences.
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Section 3    - Disqualification from tender process and exclusion from future
             contracts

      If the Bidder(s)/Contractor(s), before award or during execution has committed a
      transgression through a violation of Section 2, above or in any other form such as to
      put his reliability or credibility in question, the Principal is entitled to disqualify the
      Bidder(s)/Contractor(s) from the tender process or take action as per the procedure
      mentioned in the “Guidelines on Banning of business dealings”. Copy of the
      “Guidelines on Banning of business dealings” is placed at Page nos. 8-16.


Section 4     – Compensation for Damages

1. If the Principal has disqualified the Bidder(s) from the tender process prior to the award
   according to Section 3, the Principal is entitled to demand and recover the damages
   equivalent to Earnest Money Deposit/Bid Security and other actual damages due to the
   consequential delay.

2. If the Principal has terminated the contract according to Section 3, or if the Principal is
   entitled to terminate the contract according to Section 3, the Principal shall be entitled
   to demand and recover from the Contractor liquidated damages of the Contract value or
   the amount equivalent to Performance Bank Guarantee.

3. The Contractor/Bidder shall not be entitled to claim from the Principal any amounts
   either as damages or otherwise, on account of termination.

Section 5     – Previous transgression

1. The Bidder declares that no previous transgressions occurred in the last 3 years with
   any other Company in any country conforming to the corruption approach or with any
   other Public Sector Enterprise in India that could justify his exclusion from the tender
   process.

2. If the Bidder makes incorrect statement on this subject, he can be disqualified from the
   tender process or action can be taken as per the procedure mentioned in “Guidelines on
   Banning of business dealings”.

Section 6     – Equal treatment of all Bidders/Contractors/Subcontractors

1. The Bidder(s)/ Contractor(s) undertake(s) to demand from all subcontractors a
   commitment in conformity with this Integrity Pact, and to submit it to the Principal before
   contract signing.

2. The Principal will enter into agreements with identical conditions as this one with all
   Bidders, Contractors and Subcontractors.

3. The Principal will disqualify from the tender process all bidders who do not sign this Pact
   or violate its provisions.
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Section 7     –Criminal  charges        against     violating    Bidder(s)/Contractor(s)/
              Subcontractor(s)

If the Principal obtains knowledge of conduct of a Bidder, Contractor or Subcontractor, or of
an employee or a representative or an associate of a Bidder, Contractor or Subcontractor
which constitutes corruption, or if the Principal has substantive suspicion in this regard, the
Principal will inform the same to the Chief Vigilance Officer.

Section 8     – Independent External Monitor/Monitors

   1. The Principal appoints competent and credible Independent External Monitor for this
      Pact. The task of the Monitor is to review independently and objectively, whether and
      to what extent the parties comply with the obligations under this agreement.

   2. The Monitor is not subject to instructions by the representatives of the parties and
      performs his functions neutrally and independently. He shall report to the Chairman,
      AI.

   3. The Bidder(s)/Contractor(s) accepts that the Monitor has the right to access without
      restriction to all Project documentation of the Principal including that provided by the
      Contractor. The Contractor 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 is under
      contractual obligation to treat the information and documents of the Bidder(s)/
      Contractor(s)/ Subcontractor(s) with confidentiality.

   4. The Principal will provide to the Monitor 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 Principal and the Contractor. The
      parties offer to the Monitor the option to participate in such meetings.

   5. As soon as the Monitor notices, or believes to notice, a violation of this agreement,
      he will so inform the Management of the Principal and request the Management to
      discontinue or take corrective action, or to take other relevant action. The monitor
      can in this regard submit non-binding recommendations. Beyond this, the Monitor
      has no right to demand from the parties that they act in a specific manner, refrain
      from action or tolerate action.

   6. The Monitor will submit a written report to the Chairman, AI within 8 to 10 weeks
      from the date of reference or intimation to him by the Principal and, should the
      occasion arise, submit proposals for correcting problematic situations.

   7. Monitor shall be entitled to compensation on the same terms as being extended to /
      provided to Independent Directors on the AI Board.

   8. If the Monitor has reported to the Chairman AI, a substantiated suspicion of an
      offence under relevant IPC/ PC Act, and the Chairman AI has not, within the
      reasonable time taken visible action to proceed against such offence or reported it to
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       the Chief Vigilance Officer, the Monitor may also transmit this information directly to
       the Central Vigilance Commissioner.

   9. The word „Monitor‟ would include both singular and plural.

Section 9      – Pact Duration

This Pact begins when both parties have legally signed it. It expires for the Contractor 3
years after the last payment under the contract, and for all other Bidders 12 months after
the contract has been awarded.

If any claim is made/lodged during this time, the same shall be binding and continue to be
valid despite the lapse of this pact as specified above, unless it is discharged / determined
by Board of AI.

Section 10 – Other provisions

1. This agreement is subject to Indian Law. Place of performance and jurisdiction is the
   Registered Office of the Principal, i.e. Mumbai.

2. Changes and supplements as well as termination notice need to be made in writing.
   Side agreements have not been made.

3. If the Contractor is a partnership or a consortium, this agreement must be signed by all
   partners or consortium members and in the case of a Company by an authorised
   representative.

4. Should one or several provisions of this agreement turn out to be invalid, the remainder
   of this agreement remains valid. In this case, the parties will strive to come to an
   agreement to their original intentions.




(For & On behalf of the Principal)                  (For & On behalf of
                                                     Bidder/ Contractor)

       (Office Seal)                                     (Office Seal)

Place --------------
Date --------------


Witness 1:
(Name & Address)            _____________________________
                            _____________________________
                            _____________________________
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                       _____________________________


Witness 2:
(Name & Address)       _____________________________
                       _____________________________
                       _____________________________
                       _____________________________
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            GUIDELINES FOR INDIAN AGENTS OF FOREIGN SUPPLIERS


1.0    There shall be compulsory registration of agents for all Global (Open) Tender and
       Limited Tender. An agent who is not registered with AI Departments/Stations shall
       apply for registration in the prescribed Application –Form.

1.1    Registered agents will file an authenticated Photostat copy duly attested by a Notary
       Public/Original certificate of the principal confirming the agency agreement and
       giving     the    status     being     enjoyed     by    the     agent     and    the
       commission/remuneration/salary/ retainer ship being paid by the principal to the
       agent before the placement of order by AI Departments/Stations.

1.2     Wherever the Indian representatives have communicated on behalf of their
       principals and the foreign parties have stated that they are not paying any
       commission to the Indian agents, and the Indian representative is working on the
       basis of salary or as retainer, a written declaration to this effect should be submitted
       by the party (i.e. Principal) before finalizing the order


2.0    DISCLOSURE OF PARTICULARS OF AGENTS/ REPRESENTATIVES IN INDIA.
       IF ANY.


2.1    Tenderers of Foreign nationality shall furnish the following details in their offer:

2.1.1 The name and address of the agents/representatives in India, if any and the extent
      of authorization and authority given to commit the Principals. In case the
      agent/representative be a foreign Company, it shall be confirmed whether it is real
      substantial Company and details of the same shall be furnished.

2.1.2 The amount of commission/remuneration included in the quoted price(s) for               such
      agents/representatives in India.

2.1.3 Confirmation of the Tenderer that the commission/ remuneration if any, payable to
      his agents/representatives in India, may be paid by AI in Indian Rupees only.

2.2    Tenderers of Indian Nationality shall furnish the following details in their offers:

2.2.1 The name and address of the foreign principals indicating their nationality as well as
      their status, i.e., whether manufacturer or agents of manufacturer holding the Letter
      of Authority of the Principal specifically authorizing the agent to make an offer in
      India in response to tender either directly or through the agents/representatives.

2.2.2 The amount of commission/remuneration included in the price (s) quoted by the
      Tenderer for himself.
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2.2.3 Confirmation     of   the     foreign  principals   of   the    Tenderer     that the
      commission/remuneration, if any, reserved for the Tenderer in the quoted price (s),
      may be paid by AI in India in equivalent Indian Rupees on satisfactory completion
      of the Project or supplies of Stores and Spares in case of operation items .

2.3      In either case, in the event of contract materializing, the terms of payment will
         provide for payment of the commission /remuneration, if any payable to the
         agents/representatives in India in Indian Rupees on expiry of 90 days after the
         discharge of the obligations under the contract.

2.4      Failure to furnish correct and detailed information as called for in paragraph-2.0
         above will render the concerned tender liable to rejection or in the event of a
         contract materializing, the same liable to termination by AI. Besides this there would
         be a penalty of banning business dealings with AI or damage or payment of a named
         sum.


                    GUIDELINES ON BANNING OF BUSINESS DEALINGS

                                           CONTENTS


 S.No.      Description                                                        Page(s)


 1.         Introduction                                                       9


 2.         Scope                                                              9


 3.         Definitions                                                        10


 4.         Initiation of Banning / Suspension                                 11


 5.         Suspension of Business Dealings                                    11-12


 6.         Ground on which Banning of Business Dealing can be                 12-13
            initiated


 7.         Banning of Business Dealings                                       13-14


 8.         Removal        from     List    of     Approved       Agencies-    14-15
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             Suppliers/Contractors etc.


 9.          Procedure for issuing Show-cause Notice                            15


 10.         Appeal against the Decision of the Competent Authority             15


 11.         Review of the Decision by the Competent Authority                  15


 12.         Circulation of the names of Agencies with whom Business            16
             Dealings have been banned




1.     Introduction

       1.1      Air India Limited (AI), being a Public Sector Enterprise and ‘State’, within the
                meaning of Article 12 of the Constitution of India, has to ensure preservation
                of rights enshrined in Chapter III of the Constitution. AI has also to safeguard
                its commercial interests. AI deals with Agencies, who have a very high degree
                of integrity, commitments and sincerity towards the work undertaken. It is
                not in the interest of AI to deal with Agencies who commit deception, fraud or
                exercise of coercion or undue influence or other misconduct in the execution
                of contracts awarded / orders issued to them. In order to ensure compliance
                with the constitutional mandate, it is incumbent on AI to observe principles of
                natural justice before banning the business dealings with any Agency.

       1.2      Since banning of business dealings involves civil consequences for an Agency
                concerned, it is incumbent that adequate opportunity of hearing is provided
                and the explanation, if tendered, is considered before passing any order in
                this regard keeping in view the facts and circumstances of the case.

2.     Scope

       2.1      The General Conditions of Contract (GCC) of AI generally provide that AI
                reserves its rights to remove from list of approved suppliers/contractors or to
                ban business dealings if any Agency has been found to have committed
                misconduct, violation of any law or any term of the agreement and also to
                suspend business dealings pending investigation. If such provision does not
                exist in any GCC, the same may be incorporated.

       2.2      Similarly, in case of sale of material there is a clause to deal with the
                Agencies/customers/buyers, who indulge in lifting of material in unauthorized
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                    manner. If such a stipulation does not exist in any Sale Order, the same may
                    be incorporated.

     2.3            However, absence of such a clause does not in any way restrict the right of
                    Company (AI) to take action/decision under these guidelines in appropriate
                    cases.

     2.4            The procedure of (i) Removal of Agency from the List of approved suppliers /
                    contractors; (ii) Suspension and (iii) Banning of Business Dealing with
                    Agencies, has been laid down in these guidelines.

     2.5            These guidelines apply to all the Departments/Stations and subsidiaries of AI.

     2.6            It is clarified that these guidelines do not deal with the decision of the
                    Management not to entertain any particular Agency due to its
                    poor/inadequate performance or for any other reason.

     2.7            The banning shall be with prospective effect, i.e., future business dealings.



3.   Definitions

     In these Guidelines, unless the context otherwise requires:

     i)             ‘Party/Contractor/Supplier/Purchaser/Customer’ shall mean and include a
                    public limited company or a private limited company, a firm whether
                    registered or not, an individual, a cooperative society or an association or a
                    group of persons engaged in any commerce, trade, industry, etc.
                    ‘Party/Contractor/Supplier/Purchaser/Customer’ in the context of these
                    guidelines is indicated as ‘Agency’.

     ii)            ‘Inter-connected Agency’ shall mean two or more companies having any of
                    the following features:

          a.   If   one is a subsidiary of the other.
          b.   If   the Director(s), Partner(s), Manager(s) or Representative(s) are common;
          c.   If   Management is common;
          d.   If   one owns or controls the other in any manner;

     iii)           ‘Competent Authority’ and ‘Appellate Authority’ shall mean the following:

          a. For Company (entire AI) Wide Banning
             The Executive Director – SBU in charge of Procurement shall be the „Competent
             Authority‟ for the purpose of these guidelines. Chairman, AI shall be the
             „Appellate Authority‟ in respect of such cases.

          b. In case the foreign supplier is not satisfied by the decision of the First Appellate
             Authority, it may approach AI Board as Second Appellate Authority.
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      c. For Departments / Stations only
         Any officer not below the rank of Executive Director appointed or nominated by
         the Functional Director / SBU Head shall be the „Appellate Authority‟ in all such
         cases.

      d. For Corporate Office only
         For procurement of items / award of contracts, to meet the  requirement of
         Corporate Office only, Head of CMMG shall be the “Competent Authority” and
         Director (Technical) shall be the “Appellate Authority”.

      e. Chairman, AI shall have overall power to take suo-moto action on any
         information available or received by him and pass such order(s) as he may think
         appropriate, including modifying the order(s) passed by any authority under
         these guidelines.

     iv)   ‘Investigating Department’ shall mean any Department or Unit investigating
           into the conduct of the Agency and shall include the Vigilance Department,
           Central Bureau of Investigation, the State Police or any other authority or
           agency set up by the Central or State Government having powers to
           investigate.

     v)    ‘List   of     approved      Agencies      -    Parties/Contractors/Suppliers/
           Purchasers/Customers shall mean and include list of approved/registered
           Agencies - Parties/Contractors/Suppliers/ Purchasers/Customers, etc.

4.   Initiation of Banning/Suspension

     Action for banning/suspension of business dealings with any Agency should be
     initiated by the department having business dealings with them after noticing the
     irregularities or misconduct on their part. The Vigilance Department of AI shall have
     the right to recommend banning/suspension and this shall be binding on the
     Department/SBU and non-compliance of these recommendations/instructions shall
     be deemed to be misconduct on the part of the Head of the Department/SBU.

5.   Suspension of Business Dealings

     5.1    If the conduct of any Agency dealing with AI is under investigation by any
            department (except Foreign Suppliers of imported coal/coke), the Competent
            Authority may consider whether the allegations under investigation are of a
            serious nature and whether pending investigation, it would be advisable to
            continue business dealing with the Agency. If the Competent Authority, after
            consideration of the matter including the recommendation of the Investigating
            Department, if any, decides that it would not be in the interest to continue
            business dealings pending investigation, it may suspend business dealings
            with the Agency. The order to this effect may indicate a brief of the charges
            under investigation. If it is decided that inter-connected Agencies would also
            come within the ambit of the order of suspension, the same should be
            specifically stated in the order. The order of suspension would operate for a
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      period not more than six months and may be communicated to the Agency as
      also to the Investigating Department. The Investigating Department may
      ensure that their investigation is completed and whole process of final order is
      over within such period.

5.2   The order of suspension shall be communicated to all Departmental Heads
      within the Departments/Stations. During the period of suspension, no
      business dealing may be held with the Agency.

5.3   As far as possible, the existing contract(s) with the Agency may continue
      unless the Competent Authority, having regard to the circumstances of the
      case, decides otherwise.

5.4   If the gravity of the misconduct/violation under investigation is very serious
      and it would not be in the interest of AI, as a whole, to deal with such an
      Agency pending investigation, the Competent Authority may send his
      recommendation to Chief Vigilance Officer (CVO), AI Corporate Office along
      with the material available. If Corporate Office considers that depending upon
      the gravity of the misconduct/violation, it would not be desirable for all the
      Departments/Stations and Subsidiaries of AI to have any dealings with the
      Agency concerned, an order suspending business dealings may be issued to
      all the Departments/Stations by the Competent Authority of the Corporate
      Office, copy of which may be endorsed to the Agency concerned. Such an
      order would operate for a period of six months from the date of issue.

5.5   For suspension of business dealings with Foreign Suppliers, following shall be
      the procedure: -

          i. Suspension of the foreign suppliers shall apply through out the
             Company including Subsidiaries.

         ii. Based on the complaint forwarded by ED-Procurement or received
             directly by Corporate Vigilance, if gravity of the misconduct under
             investigation is found serious and it is felt that it would not be in the
             interest of AI to continue to deal with such agency, pending
             investigation, Corporate Vigilance may send such recommendation on
             the matter to Executive Director-Procurement to place it before a
             Committee consisting of the following :

             1.     Director-Finance/Head of Corporate Finance;
             2.     SBU Head/Department concerned;
             3.     ED-Headquarters/Head of Corporate Office;
             4.     GM-Legal/Head of Corporate Law.

             The committee shall expeditiously examine the report, give its
             comments/recommendations within twenty one days of receipt of the
             reference by ED-Procurement.
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              iii. The comments/recommendations of the Committee shall then be
                   placed by ED-Procurement before the Board of AI and if the Board
                   opines that it is a fit case for suspension, SBU Head may pass
                   necessary orders, which shall be communicated, to the foreign supplier
                   by ED-Headquarters.

     5.6   If the Agency concerned asks for detailed reasons of suspension, the Agency
           may be informed that its conduct is under investigation. It is not necessary to
           enter into correspondence or argument with the Agency at this stage.

     5.7   It is not necessary to give any show-cause notice or personal hearing to    the
           Agency before issuing the order of suspension. However, if investigations   are
           not complete in six months time, the Competent Authority may extend         the
           period of suspension by another three months, during which period           the
           investigations must be completed.

6.   Grounds on which Banning of Business Dealings can be initiated

     6.1   If the security consideration, including questions of loyalty of the Agency to
           the State, so warrants;

     6.2   If the Director/Owner of the Agency, proprietor or partner of the firm, is
           convicted by a Court of Law for offences involving moral turpitude in relation
           to its business dealings with the Government or any other public sector
           enterprises or AI, during the last five years;

     6.3   If there is strong justification for believing that the Directors, Proprietors,
           Partners, owner of the Agency have been guilty of malpractices such as
           bribery, corruption, fraud, substitution of tenders, interpolations, etc;

     6.4   If the Agency continuously refuses to return/refund the dues of AI without
           showing adequate reason and this is not due to any reasonable dispute which
           would attract proceedings in arbitration or Court of Law;

     6.5   If the Agency employs a public servant dismissed/removed or employs a
           person convicted for an offence involving corruption or abetment of such
           offence;

     6.6   If business dealings with the Agency have been banned by the Govt. or any
           other public sector enterprise;

     6.7   If the Agency has resorted to Corrupt, fraudulent practices, coercion, undue
           influence and other violations including misrepresentation of facts;

     6.8   If the Agency uses intimidation/threatening or brings undue outside pressure
           on the Company (AI or its official in acceptance/ performances of the job
           under the contract;
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       6.9    If the Agency indulges in repeated and/or deliberate use of delay tactics in
              complying with contractual stipulations;

       6.10   Willful indulgence by the Agency in supplying sub-standard material
              irrespective of whether pre-despatch inspection was carried out by Company
              (AI) or not;

       6.11   Based on the findings of the investigation report of CBI/Police/internal
              Vigilance or any other investigative agency including Government Audit
              against the Agency for malafide/unlawful acts or improper conduct on his part
              in matters relating to the Company (AI) or even otherwise;

       6.12   Established litigant nature of the Agency to derive undue benefit;

       6.13   Continued poor performance of the Agency in several contracts;

       6.14   If the Agency misuses the premises or facilities of the Company (AI),
              forcefully occupies tampers or damages the Company‟s properties including
              land, water resources, forests / trees, etc.

              (Note: The examples given above are only illustrative and not exhaustive. The
              Competent Authority may decide to ban business dealing for any good and
              sufficient reason).

7   Banning of Business Dealings

       7.1    Normally, a decision to ban business dealings with any Agency should apply
              throughout the Company including Subsidiaries. However, the Competent
              Authority of the Department/Unit except Corporate Office can impose such
              ban unit-wise only if in the particular case banning of business dealings by
              respective Department/Unit will serve the purpose and achieve its objective
              and banning throughout the Company is not required in view of the local
              conditions and impact of the misconduct/default to beyond the
              Department/Unit. Any ban imposed by Corporate Office shall be applicable
              across all Departments/Stations of the Company including Subsidiaries.

       7.2    For Company-wide banning, the proposal should be sent by ACVO of the
              Department/Unit to the CVO through the Chief Executive of the
              Department/Unit setting out the facts of the case and the justification of the
              action proposed along with all the relevant papers and documents except for
              banning of business dealings with Foreign Suppliers of imported coal/coke.

              The Corporate Vigilance shall process the proposal of the Department/Unit for
              a prima-facie view in the matter by the Competent Authority nominated for
              Company-wide banning.

              The CVO shall get feedback about that agency from all other
              Departments/Stations. Based on this feedback, a prima-facie decision for
              banning/or otherwise shall be taken by the Competent Authority.
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          If the prima-facie decision for Company-wide banning has been taken, the
          Corporate Vigilance shall issue a show-cause notice to the agency conveying
          why it should not be banned throughout AI.

          After considering the reply of the Agency and other circumstances and facts
          of the case, a final decision for Company-wide banning shall be taken by the
          Competent Authority.

    7.3   There will be a Standing Committee in each Department/Unit to be appointed
          by Chief Executive for processing the cases of “Banning of Business Dealings”
          except for banning of business dealings with foreign suppliers of coal/coke.
          However, for procurement of items/award of contracts, to meet the
          requirement of Corporate Office only, the committee shall be consisting of
          Executive Director/General Manager from Finance, Procurement and Legal:

          i)     To study the report of the Investigating Agency and decide if a prima-
                 facie case for Company-wide/Local unit wise banning exists, if not,
                 send back the case to the Competent Authority.

          ii)    To recommend for issue of show-cause notice to the Agency by the
                 concerned department.

          iii)   To examine the reply to show-cause notice and call the Agency for
                 personal hearing, if required.

          iv)    To submit final recommendation to the Competent Authority for
                 banning or otherwise.

    7.4   If the Competent Authority is prima-facie of the view that action for banning
          business dealings with the Agency is called for, a show-cause notice may be
          issued to the Agency as per paragraph 9.1 and an enquiry held accordingly.

8   Removal from List of Approved Agencies - Suppliers/Contractors, etc.

    8.1   If the Competent Authority decides that the charge against the Agency is of a
          minor nature, it may issue a show-cause notice as to why the name of the
          Agency should not be removed from the list of approved Agencies -
          Suppliers/Contractors, etc.

    8.2   The effect of such an order would be that the Agency would not be
          disqualified from competing in Open Tender Enquiries.

    8.3   Past performance of the Agency may be taken into account while processing
          for approval of the Competent Authority for awarding the contract.

9   Show-cause Notice
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     9.1    In case where the Competent Authority decides that action against an Agency
            is called for, a show-cause notice has to be issued to the Agency. Statement
            containing the imputation of misconduct or misbehavior may be appended to
            the show-cause notice and the Agency should be asked to submit within 15
            days a written statement in its defense.

     9. 2   If the Agency requests for inspection of any relevant document in possession
            of AI, necessary facility for inspection of documents may be provided.

     9.3    The Competent Authority may consider and pass an appropriate speaking
            order:
                  a. For exonerating the Agency if the charges are not established;
                  b. For   removing    the Agency       from   the   list  of   approved
                     Suppliers/Contactors, etc.
                  c. For banning the business dealing with the Agency.

     9.4    If it decides to ban business dealings, the period for which the ban would be
            operative may be mentioned. The order may also mention that the ban would
            extend to the interconnected Agencies of the Agency.



10   Appeal against the Decision of the Competent Authority

     10.1   The Agency may file an appeal against the order of the Competent Authority
            banning business dealing, etc. The appeal shall be to the Appellate Authority.
            Such an appeal shall be preferred within one month from the date of receipt
            of the order banning business dealing, etc.

     10.2   Appellate Authority would consider the appeal and pass appropriate order
            which shall be communicated to the Agency as well as the Competent
            Authority.

11   Review of the Decision by the Competent Authority

     Any petition/application filed by the Agency concerning the review of the banning
     order passed originally by Chief Executive/Competent Authority under the existing
     guidelines either before or after filing of appeal before the Appellate Authority or
     after disposal of appeal by the Appellate Authority, the review petition can be
     decided by the Chief Executive/Competent Authority upon disclosure of new
     facts/circumstances or subsequent development necessitating such review. The
     Competent Authority may refer the same petition to the Standing Committee for
     examination and recommendation.
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12   Circulation of the names of Agencies with whom Business Dealings have
     been banned
     12.1   Depending upon the gravity of misconduct established, the Competent
            Authority of the Corporate Office may circulate the names of Agency with
            whom business dealings have been banned, to the Government Departments,
            other Public Sector Enterprises, etc. for such action as they deem appropriate.
     12.2   If Government Departments or a Public Sector Enterprise request for more
            information about the Agency with whom business dealings have been
            banned, a copy of the report of Inquiring Authority together with a copy of
            the order of the Competent Authority/Appellate Authority may be supplied.
     12.3   If business dealings with any Agency have been banned by the Central or
            State Government or any other Public Sector Enterprise, AI may, without any
            further enquiry or investigation, issue an order banning business dealing with
            the Agency and its inter-connected Agencies.
     12.4   Based on the above, Departments/Stations may formulate their own
            procedure for implementation of the Guidelines.

				
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