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									                           CONTRACT NO. OCTDMS/ 02 /2009-10

  CONTRACT: Consultancy Service for Internal Audit of OCTMP
Project in Orissa Community Tank development & Management Society

                            Lump-Sum
                               between

                         Project Director,
      Orissa Community Tank Management & Development Society
                 Rajiv Bhawan, Bhubaneswar – 751 001

                                 and

            Roy Ghosh &Associates, Chartered Accountants
   545, G T Road (South),4th Floor, Room No.410,Howrah – 711 1013.




                          Dated: 01.08.2009




                                                                     1
                               I. Form of Contract
                                        LUMP-SUM

                         (All notes should be deleted in final text)

This CONTRACT(hereinafter called the “Contract”) is made on the 1st day of the month of
August 2009 between Orissa Community Tank Development and Management Society,
 Department of Water Resources, Government of Orissa on the one hand, (hereinafter called
the “Client”)     and, on the other hand, Roy Ghosh & Associates,Chartered
Accountants(hereinafter called the “Consultant”)


WHEREAS
       (a)    the Client has requested the Consultant to provide certain consulting services
              as defined in this Contract (hereinafter called the “Services”);
       (b)    the Consultant, having represented to the Client that it has the required
              professional skills, and personnel and technical resources, has agreed to
              provide the Services on the terms and conditions set forth in this Contract;
       (c)    the Client has received a loan from the International Bank for Reconstruction
              and Development (hereinafter called the “Bank”) and a credit from the
              International Development Association (hereinafter called the “Association”)
              towards the cost of the Services and intends to apply a portion of the proceeds
              of this loan [or credit] to eligible payments under this Contract, it being
              understood (i) that payments by the Bank [or Association] will be made only
              at the request of the Client and upon approval by the Bank [or Association],
              (ii) that such payments will be subject, in all respects, to the terms and
              conditions of the agreement providing for the loan [or credit], and (iii) that no
              party other than the Client shall derive any rights from the agreement
              providing for the loan [or credit] or have any claim to the loan [or credit]
              proceeds;
NOW THEREFORE the parties hereto hereby agree as follows:
1.     The following documents attached hereto shall be deemed to form an integral part of
       this Contract:
       (a)    The General Conditions of Contract;
       (b)    The Special Conditions of Contract;
       (c)    The following Appendices:

              Appendix A:   Description of Services
              Appendix B:   Reporting Requirements
              Appendix C:   Key Personnel and Sub-Consultants
              Appendix D:   Breakdown of Contract Price in Foreign Currency
                                                                                             2
              Appendix E:     Breakdown of Contract Price in Local Currency
              Appendix F:    Services and Facilities Provided by the Client
              Appendix G:     Form of Advance Payment Guarantee
              Appendix H:     Financial Negotiation – Breakdown of
                              Remuneration Rates                                    ----
2.     The mutual rights and obligations of the Client and the Consultant shall be as set forth
       in the Contract, in particular:
       (a)    the Consultants shall carry out the Services in accordance with the provisions
              of the Contract; and
       (b)    the Client shall make payments to the Consultants in accordance with the
              provisions of the Contract.
IN WITNESS WHEREOF, the Parties hereto have caused this Contract to be signed in their
respective names as of the day and year first above written.


For and on behalf of Orissa Community Tank Development and Management Society




Project Director, OCTDMS-cum-
Special Secretary to the Government
[Authorized Representative]

For and on behalf of Roy Ghosh & Associates.Chartered Accountants



 (Mr Subrata Roy )
[Authorized Representative]




                                                                                             3
                  II. General Conditions of Contract
                              1. GENERAL PROVISIONS
                                          2.
1.1 Definitions   Unless the context otherwise requires, the following terms whenever
                  used in this Contract have the following meanings:
                  (a)     “Applicable Law” means the laws and any other instruments
                  having the force of law in the Government’s country, or in such other
                  country as may be specified in the Special Conditions of Contract
                  (SC), as they may be issued and in force from time to time.
                  (b)   “Bank” means the International Bank for Reconstruction and
                  Development, Washington, D.C., U.S.A., or the International
                  Development Association, Washington, D.C., U.S.A.
                  (c)    “Consultant” means any private or public entity that will
                  provide the Services to the Client under the Contract.
                  (d)     “Contract” means the Contract signed by the Parties and all
                  the attached documents listed in its Clause 1, that is these General
                  Conditions (GC), the Special Conditions (SC), and the Appendices.
                  (e)    “Day” means calendar day.
                  (f)    “Effective Date” means the date on which this Contract
                  comes into force and effect pursuant to Clause GC 2.1.
                  (g)    “Foreign Currency” means any currency other than the
                  currency of the Client’s country.
                  (h)    “GC” means these General Conditions of Contract.
                  (i)    “Government” means the Government of the Client’s
                  country.
                  (j)    “Local Currency” means the currency of the Client’s country.
                  (k)     “Member” means any of the entities that make up the joint
                  venture/consortium/association; and “Members” means all these
                  entities.
                  (l)    “Party” means the Client or the Consultant, as the case may
                  be, and “Parties” means both of them.
                  (m)    “Personnel” means professionals and support staff provided
                  by the Consultants or by any Sub-Consultants and assigned to
                  perform the Services or any part thereof; “Foreign Personnel” means
                  such professionals and support staff who at the time of being so
                  provided had their domicile outside the Government’s country;
                  “Local Personnel” means such professionals and support staff who at

                                                                                      4
                   the time of being so provided had their domicile inside the
                   Government’s country; and “Key Personnel” means the Personnel
                   referred to in Clause GC 4.2(a).
                   (n)     “Reimbursable expenses” means all assignment-related costs
                   other than Consultant’s remuneration.
                   (o)  “SC” means the Special Conditions of Contract by which the
                   GC may be amended or supplemented.
                   (p)    “Services” means the work to be performed by the Consultant
                   pursuant to this Contract, as described in Appendix A hereto.
                   (q)  “Sub-Consultants” means any person or entity to
                   whom/which the Consultant subcontracts any part of the Services.
                   (r)   “Third Party” means any person or entity other than the
                   Government, the Client, the Consultant or a Sub-Consultant.
                   (s)     “In writing” means communicated in written form with proof
                   of receipt.
1.2 Relationship   Nothing contained herein shall be construed as establishing a
    Between the    relationship of master and servant or of principal and agent as
    Parties        between the Client and the Consultant. The Consultant, subject to
                   this Contract, has complete charge of Personnel and Sub-Consultants,
                   if any, performing the Services and shall be fully responsible for the
                   Services performed by them or on their behalf hereunder.
1.3 Law            This Contract, its meaning and interpretation, and the relation
    Governing      between the Parties shall be governed by the Applicable Law.
    Contract
1.4 Language       This Contract has been executed in the language specified in the SC,
                   which shall be the binding and controlling language for all matters
                   relating to the meaning or interpretation of this Contract.

1.5 Headings       The headings shall not limit, alter or affect the meaning of this
                   Contract.
1.6 Notices        1.6.1 Any notice, request or consent required or permitted to be
                   given or made pursuant to this Contract shall be in writing. Any
                   such notice, request or consent shall be deemed to have been given or
                   made when delivered in person to an authorized representative of the
                   Party to whom the communication is addressed, or when sent to such
                   Party at the address specified in the SC.
                   1.6.2 A Party may change its address for notice hereunder by
                   giving the other Party notice in writing of such change to the address
                   specified in the SC.

                                                                                        5
1.7 Location           The Services shall be performed at such locations as are specified in
                       Appendix A hereto and, where the location of a particular task is not
                       so specified, at such locations, whether in the Government’s country
                       or elsewhere, as the Client may approve.
1.8 Authority of       In case the Consultant consists of a joint venture/consortium/
    Member in          association of more than one entity, the Members hereby authorize
    Charge             the entity specified in the SC to act on their behalf in exercising all
                       the Consultant’s rights and obligations towards the Client under this
                       Contract, including without limitation the receiving of instructions
                       and payments from the Client.

1.9 Authorized         Any action required or permitted to be taken, and any document
     Representatives   required or permitted to be executed under this Contract by the Client
                       or the Consultant may be taken or executed by the officials specified
                       in the SC.
1.10 Taxes and         The Consultant, Sub-Consultants and Personnel shall pay such
     Duties            indirect taxes, duties, fees and other impositions levied under the
                       Applicable Law as specified in the SC.
1.11 Fraud and
     Corruption
1.11.1 Definitions     It is the Bank’s policy to require that Borrowers (including
                       beneficiaries of Bank loans), as well as Consultants under Bank-
                       financed contracts, observe the highest standard of ethics during the
                       execution of the Contract. In pursuance of this policy, the Bank:
                       (a)      defines, for the purpose of this provision, the terms set forth
                       below as follows:
                       (i)     “corrupt practice” is the offering, receiving, or soliciting,
                       directly or indirectly, of any thing of value to influence the action of
                       a public official in the selection process or in contract execution;
                       (ii)    “fraudulent practice” is a misrepresentation or omission of
                       facts in order to influence a selection process or the execution of a
                       contract;
                       (iii) “collusive practices” is a scheme or arrangement between two
                       or more consultants, with or without the knowledge of the Borrower,
                       designed to establish prices at artificial, noncompetitive levels;
                       (iv)             “coercive practices” is harming or threatening to
                       harm, directly or indirectly, persons or their property to influence
                       their participation in a procurement process, or affect the execution
                       of a contract;

                       (v)          “obstructive practice” is


                                                                                               6
                                     (aa)    deliberately destroying , falsifying, altering or
                                             concealing of evidence material to the
                                             investigation or making false statements to
                                             investigators in order to materially impede a
                                             Bank investigation into allegations of a
                                             corrupt, fraudulent , coercive or collusive
                                             practice ; and/or threatening, harassing or
                                             intimidating any party to prevent it from
                                             disclosing its knowledge of matter relevant to
                                             the investigation or from perusing the
                                             investigation , or

                                     (bb)    acts intended to materially impede the
                                             exercise of the Bank’s inspection and audit
                                             rights provided for under sub-clause 37.1(e)
                                             below.


1.11.2 Measures to
     be Taken         (b)    will cancel the portion of the loan allocated to a contract if it
                      determines at any time that representatives of the Borrower or of a
                      beneficiary of the loan were engaged in corrupt, fraudulent, collusive
                      or coercive practices during the selection process or the execution of
                      that contract, without the Borrower having taken timely and
                      appropriate action satisfactory to the Bank to remedy the situation;
                      (c)     will sanction a Consultant, including declaring the Consultant
                      ineligible, either indefinitely or for a stated period of time, to be
                      awarded a Bank-financed contract if it at any time determines that
                      the Consultant has, directly or through an agent, engaged in corrupt,
                      fraudulent, collusive or coercive practices in competing for, or in
                      executing, a Bank-financed contract;
1.11.3 Commis-        (d)     will require the successful Consultants to disclose any
     sions and Fees   commissions or fees that may have been paid or are to be paid to
                      agents, representatives, or commission agents with respect to the
                      selection process or execution of the contract. The information
                      disclosed must include at least the name and address of the agent,
                      representative, or commission agent, the amount and currency, and
                      the purpose of the commission or fee.
2. COMMENCEMENT, COMPLETION, MODIFICATION AND TERMINATION OF CONTRACT

2.1 Effectiveness     This Contract shall come into effect on the date the Contract is
    of Contract       signed by both Parties or such other later date as may be stated in
                      the SC. The date the Contract comes into effect is defined as the
                      Effective Date.


                                                                                                 7
2.2 Commence-         The Consultant shall begin carrying out the Services not later than
    ment of           the number of days after the Effective Date specified in the SC.
    Services
2.3 Expiration of     Unless terminated earlier pursuant to Clause GC 2.6 hereof, this
    Contract          Contract shall expire at the end of such time period after the
                      Effective Date as specified in the SC.
2.4 Modifications     Any modification or variation of the terms and conditions of this
    or Variations     Contract, including any modification or variation of the scope of the
                      Services, may only be made by written agreement between the
                      Parties. However, each Party shall give due consideration to any
                      proposals for modification or variation made by the other Party.

2.5 Force Majeure

                      For the purposes of this Contract, “Force Majeure” means an event
2.5.1 Definition      which is beyond the reasonable control of a Party and which makes a
                      Party’s performance of its obligations under the Contract impossible
                      or so impractical as to be considered impossible under the
                      circumstances.
                      The failure of a Party to fulfill any of its obligations under the
2.5.2 No Breach       contract shall not be considered to be a breach of, or default under,
      of Contract     this Contract insofar as such inability arises from an event of Force
                      Majeure, provided that the Party affected by such an event (a) has
                      taken all reasonable precautions, due care and reasonable alternative
                      measures in order to carry out the terms and conditions of this
                      Contract, and (b) has informed the other Party as soon as possible
                      about the occurrence of such an event.

                      Any period within which a Party shall, pursuant to this Contract,
2.5.3 Extension of    complete any action or task, shall be extended for a period equal to
      Time            the time during which such Party was unable to perform such action
                      as a result of Force Majeure.

                      During the period of their inability to perform the Services as a result
2.5.4 Payments        of an event of Force Majeure, the Consultant shall be entitled to
                      continue to be paid under the terms of this Contract, as well as to be
                      reimbursed for additional costs reasonably and necessarily incurred
                      by them during such period for the purposes of the Services and in
                      reactivating the Service after the end of such period.

2.6 Termination

                      The Client may terminate this Contract in case of the occurrence of
2.6.1 By the Client   any of the events specified in paragraphs (a) through (f) of this
                      Clause GC 2.6.1. In such an occurrence the Client shall give a not
                      less than thirty (30) days’ written notice of termination to the

                                                                                             8
Consultant, and sixty (60) days’ in the case of the event referred to
in (e).

(a)   If the Consultant does not remedy a failure in the performance
      of their obligations under the Contract, within thirty (30) days
      after being notified or within any further period as the Client
      may have subsequently approved in writing.

(b)   If the Consultant becomes insolvent or bankrupt.

(c)   If the Consultant, in the judgment of the Client has engaged in
      corrupt or fraudulent practices in competing for or in executing
      the Contract.

(d)   If, as the result of Force Majeure, the Consultant are unable to
      perform a material portion of the Services for a period of not
      less than sixty (60) days.

(e)   If the Client, in its sole discretion and for any reason
      whatsoever, decides to terminate this Contract.

(f)   If the Consultant fails to comply with any final decision
      reached as a result of arbitration proceedings pursuant to Clause
      GC 8 hereof.




                                                                      9
                     The Consultants may terminate this Contract, by not less than thirty
2.6.2 By the         (30) days’ written notice to the Client, such notice to be given after
      Consultant     the occurrence of any of the events specified in paragraphs (a)
                     through (c) of this Clause GC 2.6.2:
                     (a)    If the Client fails to pay any money due to the Consultant
                            pursuant to this Contract and not subject to dispute pursuant to
                            Clause GC 7 hereof within forty-five (45) days after receiving
                            written notice from the Consultant that such payment is
                            overdue.
                     (b)    If, as the result of Force Majeure, the Consultant is unable to
                            perform a material portion of the Services for a period of not
                            less than sixty (60) days.
                     (c)    If the Client fails to comply with any final decision reached as a
                            result of arbitration pursuant to Clause GC 8 hereof.
                  Upon termination of this Contract pursuant to Clauses GC 2.6.1 or
2.6.3 Payment     GC 2.6.2, the Client shall make the following payments to the
      upon        Consultant:
      Termination
                  (a) payment pursuant to Clause GC 6 for Services satisfactorily
                      performed prior to the effective date of termination;
                     (b)    except in the case of termination pursuant to paragraphs (a)
                            through (c), and (f) of Clause GC 2.6.1, reimbursement of any
                            reasonable cost incident to the prompt and orderly termination
                            of the Contract, including the cost of the return travel of the
                            Personnel and their eligible dependents.


                           3. OBLIGATIONS OF THE CONSULTANT

3.1 General
                     The Consultant shall perform the Services and carry out their
3.1.1 Standard of    obligations hereunder with all due diligence, efficiency and
      Perform-       economy, in accordance with generally accepted professional
      ance           standards and practices, and shall observe sound management
                     practices, and employ appropriate technology and safe and effective
                     equipment, machinery, materials and methods. The Consultant shall
                     always act, in respect of any matter relating to this Contract or to the
                     Services, as faithful advisers to the Client, and shall at all times
                     support and safeguard the Client’s legitimate interests in any dealings
                     with Sub-Consultants or third Parties.




                                                                                           10
3.2 Conflict of         The Consultant shall hold the Client’s interests paramount, without
    Interests           any consideration for future work, and strictly avoid conflict with
                        other assignments or their own corporate interests.
                        The payment of the Consultant pursuant to Clause GC 6 shall
3.2. 1 Consultants      constitute the Consultant’s only payment in connection with this
        Not to          Contract or the Services, and the Consultant shall not accept for their
        Benefit         own benefit any trade commission, discount, or similar payment in
        from            connection with activities pursuant to this Contract or to the Services
        Commis-         or in the discharge of their obligations under the Contract, and the
        sions, Dis-     Consultant shall use their best efforts to ensure that the Personnel,
        counts, etc.    any Sub-Consultants, and agents of either of them similarly shall not
                        receive any such additional payment.
                        The Consultant agrees that, during the term of this Contract and after
3.2.2 Consultant        its termination, the Consultant and any entity affiliated with the
       and              Consultant, as well as any Sub-Consultants and any entity affiliated
       Affiliates Not   with such Sub-Consultants, shall be disqualified from providing
       to be            goods, works or services (other than consulting services) resulting
       Otherwise        from or directly related to the Consultant’s Services for the
       Interested in    preparation or implementation of the project.
       Project
                        The Consultant shall not engage, and shall cause their Personnel as
3.2.3 Prohibition       well as their Sub-Consultants and their Personnel not to engage,
      of Conflicting    either directly or indirectly, in any business or professional activities
      Activities        which would conflict with the activities assigned to them under this
                        Contract.

3.3 Confidentiality Except with the prior written consent of the Client, the Consultant
                    and the Personnel shall not at any time communicate to any person
                    or entity any confidential information acquired in the course of the
                    Services, nor shall the Consultant and the Personnel make public the
                    recommendations formulated in the course of, or as a result of, the
                    Services.
3.4 Insurance to        The Consultant (a) shall take out and maintain, and shall cause any
    be Taken Out        Sub-Consultants to take out and maintain, at their (or the Sub-
    by the              Consultants’, as the case may be) own cost but on terms and
    Consultant          conditions approved by the Client, insurance against the risks, and
                        for the coverage, as shall be specified in the SC; and (b) at the
                        Client’s request, shall provide evidence to the Client showing that
                        such insurance has been taken out and maintained and that the
                        current premiums have been paid.




                                                                                               11
3.5 Consultant’s     The Consultant shall obtain the Client’s prior approval in writing before
    Actions          taking any of the following actions:
    Requiring
    Client’s Prior   (a)    entering into a subcontract for the performance of any part of the
    Approval                Services,
                     (b)    appointing such members of the Personnel not listed by name in
                            Appendix C, and
                     (c)    any other action that may be specified in the SC.
3.6 Reporting        (a)    The Consultant shall submit to the Client the reports and
    Obligations             documents specified in Appendix B hereto, in the form, in the
                            numbers and within the time periods set forth in the said Appendix.
                     (b)    Final reports shall be delivered in CD ROM in addition to the hard
                            copies specified in said Appendix.
3.7 Documents      (a)      All plans, drawings, specifications, designs, reports, other
    Prepared by             documents and software submitted by the Consultant under this
    the Consultant          Contract shall become and remain the property of the Client, and
    to be the               the Consultant shall, not later than upon termination or expiration
    Property of             of this Contract, deliver all such documents to the Client, together
    the Client              with a detailed inventory thereof.
                     (b)    The Consultant may retain a copy of such documents and software.
                            Restrictions about the future use of these documents, if any, shall
                            be specified in the SC.
3.8 Accounting,            The Consultant (i) shall keep accurate and systematic accounts and
    Inspection and         records in respect of the Services hereunder, in accordance with
    Auditing               internationally accepted accounting principles and in such form and
                           detail as will clearly identify all relevant time changes and costs,
                           and the bases thereof, and (ii) shall periodically permit the Client or
                           its designated representative and/or the Bank, and up to two years
                           from the expiration or termination of this Contract, to inspect the
                           same and make copies thereof as well as to have them audited by
                           auditors appointed by the Client or the Bank, if so required by the
                           Client or the Bank as the case may be.


                              4. CONSULTANT’S PERSONNEL

4.1 Description of   The Consultant shall employ and provide such qualified and experienced
    Personnel        Personnel and Sub-Consultants as are required to carry out the Services.
                     The titles, agreed job descriptions, minimum qualifications, and
                     estimated periods of engagement in the carrying out of the Services of
                     the Consultant’s Key Personnel are described in Appendix C. The Key
                     Personnel and Sub-Consultants listed by title as well as by name in

                                                                                            12
                      Appendix C are hereby approved by the Client.

4.2 Removal           (a)   Except as the Client may otherwise agree, no changes shall be
    and/or                  made in the Key Personnel. If, for any reason beyond the
    Replacement             reasonable control of the Consultant, such as retirement, death,
    of Personnel            medical incapacity, among others, it becomes necessary to replace
                            any of the Key Personnel, the Consultant shall provide as a
                            replacement a person of equivalent or better qualifications.

                      (b)   If the Client finds that any of the Personnel have (i) committed
                            serious misconduct or have been charged with having committed a
                            criminal action, or (ii) have reasonable cause to be dissatisfied with
                            the performance of any of the Personnel, then the Consultant shall,
                            at the Client’s written request specifying the grounds thereof,
                            provide as a replacement a person with qualifications and
                            experience acceptable to the Client.

                      (c)   The Consultant shall have no claim for additional costs arising out
                            of or incidental to any removal and/or replacement of Personnel.


                             5. OBLIGATIONS OF THE CLIENT

5.1 Assistance and The Client shall use its best efforts to ensure that the Government shall
    Exemptions     provide the Consultant such assistance and exemptions as specified in
                   the SC.

5.2 Change in the     If, after the date of this Contract, there is any change in the Applicable
    Applicable        Law with respect to taxes and duties which increases or decreases the
    Law Related to    cost incurred by the Consultant in performing the Services, then the
    Taxes and         remuneration and reimbursable expenses otherwise payable to the
    Duties            Consultant under this Contract shall be increased or decreased
                      accordingly by agreement between the Parties, and corresponding
                      adjustments shall be made to the amounts referred to in Clauses GC 6.2
                      (a) or (b), as the case may be.

5.3 Services and      The Client shall make available free of charge to the Consultant the
    Facilities        Services and Facilities listed under Appendix F.


                            6. PAYMENTS TO THE CONSULTANT

6.1 Lump-Sum          The total payment due to the Consultant shall not exceed the Contract
    Payment           Price which is an all inclusive fixed lump-sum covering all costs
                      required to carry out the Services described in Appendix A. Except as
                      provided in Clause 5.2, the Contract Price may only be increased above
                      the amounts stated in Clause 6.2 if the Parties have agreed to additional

                                                                                            13
                    payments in accordance with Clause 2.4.
6.2 Contract Price (a)    The price payable in foreign currency/currencies is set forth in the
                          SC.
                    (b)   The price payable in local currency is set forth in the SC.
6.3 Payment for     For the purpose of determining the remuneration due for additional
    Additional      services as may be agreed under Clause 2.4, a breakdown of the lump-
    Services        sum price is provided in Appendices D and E.
6.4 Terms and       Payments will be made to the account of the Consultant and according
    Conditions of   to the payment schedule stated in the SC. Unless otherwise stated in the
    Payment         SC, the first payment shall be made against the provision by the
                    Consultant of an advance payment guarantee for the same amount, and
                    shall be valid for the period stated in the SC. Such guarantee shall be in
                    the form set forth in Appendix G hereto, or in such other form, as the
                    Client shall have approved in writing. Any other payment shall be made
                    after the conditions listed in the SC for such payment have been met,
                    and the Consultant has submitted an invoice to the Client specifying the
                    amount due.

6.5 Interest on     If the Client has delayed payments beyond fifteen (15) days after the due
    Delayed         date stated in the Clause SC 6.4, interest shall be paid to the Consultant
    Payments        for each day of delay at the rate stated in the SC.


                                   7. GOOD FAITH

7.1 Good Faith      The Parties undertake to act in good faith with respect to each other’s
                    rights under this Contract and to adopt all reasonable measures to ensure
                    the realization of the objectives of this Contract.


                            8. SETTLEMENT OF DISPUTES

8.1 Amicable        The Parties agree that the avoidance or early resolution of disputes is
    Settlement      crucial for a smooth execution of the Contract and the success of the
                    assignment. The Parties shall use their best efforts to settle amicably all
                    disputes arising out of or in connection with this Contract or its
                    interpretation.
8.2 Dispute         Any dispute between the Parties as to matters arising pursuant to this
    Resolution      Contract that cannot be settled amicably within thirty (30) days after
                    receipt by one Party of the other Party’s request for such amicable
                    settlement may be submitted by either Party for settlement in accordance
                    with the provisions specified in the SC.


                                                                                         14
                       III. Special Conditions of Contract

Number                      Amendments of, and Supplements to, Clauses in the
 of GC                             General Conditions of Contract
Clause

1.1 (a)   The words “in the Government’s country” are amended to read “in India”.


1.3       The language is : English


1.4       Address: Office of the Project Director, OCTDMS - cum - Special    Secretary,
                    Department of Water Resources
                    Orissa Community Tank Management Project
                    Rajeev Bhawan, Bhubaneswar
                    Orissa-751001
          Attention: Mr. Surendra Kumar, IAS Project Director
          Facsimile:     0674-2392446
          E-mail: pd_octmp@yahoo.co.in


          Consultant: Roy Ghosh & Associates, Chartered Accountants


          Attention:     Mr.Subrata Roy,.Partner
                         Roy Ghosh & Associates, Chartered Accountants
                         545,G T Road(South),4th Floor,
                         Room No.410,Howrah – 711 1013.
          Facsimile:     +91 033-26386682
          E-mail:        royghosh@hotmail.com




                                                                                      15
1.6     Deleted


1.7     The Authorized Representatives are:
        For the Client:       Sri. Surendra Kumar, Project Director, OCTDMS


        For the Consultant:   Sri. Subrata Roy ,Partner


1.8

1.8.1   For domestic consultants/personnel and foreign consultants/personnel who are permanent
        residents in India

        The consultants and personnel shall pay the taxes, duties, fees, levies and other
        impositions levied under the existing, amended or enacted laws during life of this
        contract and the client shall perform such duties in regard to the deduction of such tax as
        may be lawfully imposed.

1.8.2   Deleted

2.2     The date for the commencement of Services is. Within 30 days from signing of contract.


2.3     The time period shall be 24 months .“Year 2 would only be triggered ,if the
        Consultant’s work in year 1 is satisfactory”

3.4     The risks and the coverage shall be as follows:
        (a)   Third Party motor vehicle liability insurance in respect of motor vehicles operated
              in the Government’s country by the Consultant or its Personnel or any Sub-
              Consultants or their Personnel, with a minimum coverage as per Motor Vehicles
              Act 1988;
        (b)   Third Party liability insurance, with a minimum coverage of Rs. 10 lakhs;
        (c)   professional liability insurance, will be equal to two times the value of this
              consultancy contract;
        (d)   employer’s liability and workers’ compensation insurance in respect of the
              Personnel of the Consultant and of any Sub-Consultants, in accordance with the
              relevant provisions of the Applicable Law, as well as, with respect to such
              Personnel, any such life, health, accident, travel or other insurance as may be
              appropriate; and



                                                                                          16
3.7(b)   The Consultant shall not use these documents and software for purposes unrelated to this
         Contract without the prior written approval of the Client.


5.1      Not Applicable.


6.2(a)   The amount in foreign currency or currencies is [NA]


6.2(b)   The amount in local currency is [insert amount]. [INR – 20,95,595 inclusive of service
         tax].
          A. Consultancy Charges
            i)      For year 2009 -2010                          - 4,74,375.00
                    Service Tax @ 10.30%                         -     48,860.00
                                                                      5,23,235.00
            ii)     For year 2010 -2011                         - 10,14,530.00
                    Service Tax @ 10.30%                         - 1,04,497.00
                                                                     11,19,027.00
           Total value of Consultancy charges ( i + ii )    INR 16,42,262.00
          B. Reimbursable Charges:                          INR 4,53,333.00
                   i)For year 2009 -2010                         - 1,60,000.00
                    Service Tax @ 10.30%                         -     16,480.00
                                                                      1,76,480.00


                    ii)For year 2010 -2011                           - 2,51,000.00
                    Service Tax @ 10.30%                         -      25,853.00
                                                                      2,76,853.00


           Total value of Reimbursable charges ( i + ii )       INR 4,53,333.00

            Total Contract value     (A + B )               INR 20,95,595.00
            N.B. Reimbursable Charges based on actual as per Appendix E


                                                                                       17
6.4(a)   The accounts are:
         for local currency: Beneficiary Name: Roy Ghosh & Associates, Chartered Accountants
         A/C No. - State Bank of India, Howrah Branch, No.11030421159
         Payments shall be made according to the following schedule:

          Sl.
              Project Detailed Assignment                       Completion   Payment
          No. Year                                              date         Schedule
                             Quarterly Reporting:
                                                              Starting            25 % of
                                 The individual audit reports August 2009      Consultants’
                                 should be submitted within                  Remunerations for
                                 30 days of the completion of                  Year 2009-10
                                 the audit . The reports will                   In each Quarter
                                 be directed as under –                             up to 3rd
                                  The Project Management                       Quarter(Subject
                                   Letter to the Project                          to review &
                                   Director, OCTDMS.                             acceptance of
                                                                                     Review
                                  The     individual audit                     Committee and
                                   reports to each of the                         clearance by
                                   auditable unit to the head                      the World
                                                                                     Bank)
                                   of the unit.
                                 In addition the internal                             And,
                                 auditor should provide an                      reimbursable as
                                 Executive       Summary                        per actual up to
                                 highlighting the critical                         the period.
                                 issues
                             Details as listed in Appendix-B


                             Final report incorporating
                                                             56 weeks from       25 % of
                             review of audit for the year signing        of    Consultants’
                             and for all the DPUs , SPU contract along Remunerations for
                                                             with report of   Year 2009-10
                             and Pani Panchayats along 4th Quarter
                                                                                  For 4th
                             with report for 4th Quarter
                                                                            Quarter(Subject to
                             Details as listed in Appendix-B                    review &
                                                                              acceptance of
                                                                            Review Committee
                                                                             and clearance by

                                                                                        18
                                                        the World Bank)
                                                      And, reimbursable
                                                      as per actual up to
                                                      the period.
           Quarterly Reporting: The
2nd        individual audit reports Starting   June        25 % of
Year       should be submitted within 2010              Consultants’
           30 days of the completion of               Remunerations for
2010-                                                   Year 2010-11
           the audit. The reports will be
2011
           directed as under –                           In each Quarter
                                                             up to 3rd
            The Project Management                      Quarter(Subject
             Letter to the Project                         to review &
             Director, OCTDMS.                            acceptance of
                                                              Review
             The     individual    audit
                                                         Committee and
           reports to each of the                          clearance by
           auditable unit to the head of                    the World
           the unit.                                          Bank)
          Details as listed in Appendix-B
                                                      And, reimbursable
           In addition the internal                   as per actual up to
           auditor should provide an                  the period 10 % in
           Executive       Summary                    each Quarter up to
           highlighting the critical                      3rd Quarter
           issues




                                                             25 % of
        Final report incorporating                         Consultants’
                                        56 weeks from Remunerations for
        review of audit for the year
                                        signing     of    Year 2010-11
        and for all the DPUs , SPU contract along
        and Pani Panchayats along with report of             For 4th
                                        4th Quarter    Quarter(Subject to
        with report for 4th Quarter                         review &
        Details as listed in Appendix-B                   acceptance of
                                                       Review Committee
                                                        and clearance by
                                                        the World Bank)



                                                      And, reimbursable


                                                                  19
                                                                       as per actual up to
                                                                           the period




6.5   Payment shall be made within 45 days of receipt of the invoice and the relevant
      documents specified in Clause 6.4, and within 60 days in the case of the final payment.
      The interest rate is: London Inter-Bank On-Lending Rate [LIBOR] plus 2% for foreign
                            currency; and 8% for local currency.




                                                                                   20
8.2   Disputes shall be settled by arbitration in accordance with the following provisions:

      Dispute Settlement

      8.2 (i) Any dispute, controversy, or claim arising out of or relating to this contract, or the
              breach, termination or invalidity thereof shall be settled by arbitration in accordance
              with following provisions:

      8.2 (ii) Each dispute submitted by a Party to arbitration shall be heard by a sole arbitrator or
               an arbitration panel composed of three arbitrators, in accordance with the following
               provisions:

      (a)     Where the Parties agree that the dispute concerns a technical matter, they may agree
              to appoint a sole arbitrator or, failing agreement on the identity of such sole arbitrator
              within thirty (30) days after receipt by the other Party of the proposal of a name for
              such an appointment by the Party who initiated the proceedings, either Party may
              apply to the President, Institution of Engineers India, New Delhi, for a list of not
              fewer than five nominees and, on receipt of such list, the Parties shall alternately
              strike names there from, and the last remaining nominee on the list shall be the sole
              arbitrator for the matter in dispute. If the last remaining nominee has not been
              determined in this manner within sixty (60) days of the date of the list, the President,
              Institution of Engineers India, New Delhi, shall appoint, upon the request of either
              Party and from such list or otherwise, a sole arbitrator for the matter in dispute.

      (b)     Where the Parties do not agree that the dispute concerns a technical matter, the Client
              and the Consultants shall each appoint one arbitrator, and these two arbitrators shall
              jointly appoint a third arbitrator, who shall chair the arbitration panel. If the
              arbitrators named by the Parties do not succeed in appointing a third arbitrator within
              thirty (30) days after the latter of the two arbitrators named by the Parties has been
              appointed, the third arbitrator shall, at the request of either Party, be appointed by
              Secretary, the Indian Council of Arbitration, New Delhi.

      (a) If, in a dispute subject to Clause 8.2 (ii) (b), one Party fails to appoint its arbitrator
          within thirty (30) days after the other Party has appointed its arbitrator, the Party which
          has named an arbitrator may apply to the Secretary, Indian Council of Arbitration, New
          Delhi, to appoint a sole arbitrator for the matter in dispute, and the arbitrator appointed
          pursuant to such application shall be the sole arbitrator for that dispute.




                                                                                         21
8.3   Rules of Procedure

      Arbitration proceedings shall be conducted in accordance with procedure of the
      Arbitration & Conciliation Act 1996, of India unless the Consultant is a foreign
      national/firm, where arbitration proceedings shall be conducted in accordance with
      the rules of procedure for arbitration of the United Nations Commission on
      International Trade Law (UNCITRAL) as in force on the date of this Contract.

8.4   Substitute Arbitrators

      If for any reason an arbitrator is unable to perform his function, a substitute shall be
      appointed in the same manner as the original arbitrator.

8.5   Qualifications of Arbitrators

      The sole arbitrator or the third arbitrator appointed pursuant to paragraphs (a) through
      (c) of Clause 7.2 (ii) hereof shall be an internationally recognized legal or technical
      expert with extensive experience in relation to the matter in dispute.

8.6   Miscellaneous

      In any arbitration proceeding hereunder:

      (a) proceedings shall, unless otherwise agreed by the Parties, be held in
               Bhubaneswar.

      (b) the English language shall be the official language for all purposes; and [Note:
          English language may be changed to any other Language, with the agreement of
          both the parties.]

      (c) the decision of the sole arbitrator or of a majority of the arbitrators (or of the third
          arbitrator if there is no such majority) shall be final and binding and shall be
          enforceable in any court of competent jurisdiction, and the Parties hereby waive
          any objections to or claims of immunity in respect of such enforcement.




                                                                                   22
IV. Appendices




                 23
                                                   Appendix A

                                          Description of the Services

                          (Detail as outlined in Terms of Reference attached below)


                             Terms of Reference for Internal Auditor(s)


1. Background
      The Government of Orissa in partnership with Government of India has initiated Orissa Community
     Tank Management Project (OCTMP) to repair and rehabilitate approximately 900 minor irrigation tanks
     having a command area of 40 ha to 2000 Ha and covering 1.20 lakh ha across the state of Orissa with
     funding from World Bank. Tank irrigation is one of the oldest methods of irrigation in Orissa. The State
     has 28,303 tanks approximately, including tanks of the Government and Private Sector (GoI, Minor
     Irrigation Census, 2001). About 3646 of these tanks are relatively large with an irrigation capacity of
     5.47 million hectares. These 3646 tanks irrigate between 40 ha to 2000 ha of land and are managed by
     the Chief Engineer (MI). The Orissa Community Tank Development and Management Society
     (OCTDMS) has been formed under the Department of Water Resources, Government of Orissa and is
     implementing the OCTMP. The project envisages execution through primary and secondary institutions
     from the State Project Unit to the Community Level Groups with facilitation of Support Organisations.
2.   Objectives of the Project-
     The overarching objective of the project is to improve agricultural productivity in selected tanks and Pani
     Panchayats to manage tank systems effectively. In order to do so the underlying objectives of the project
     include:
     Strengthening community-based institutions to assume responsibility for the tank system improvement
     and management: This would include, inter alia, development of human resources, formation and/ or
     strengthening of local institutions for tank improvement and management, and developing mechanisms whereby
     the needs of the traditionally vulnerable stakeholders can be addressed.
     Tank System Improvements: This would include physical investment in tank systems. The actual rehabilitation
     work required would be determined for each tank system individually with an upfront ‘Tank Improvement and
     Management Plan’ prepared in consultation with tank users prior to undertaking any investments. In general,
     interventions are likely to address deficiencies in feeder channels, tank bed and structures, and the water
     distribution and drainage systems.
     Livelihoods support services for tank system users: This would include promotion of farmer interest groups,
     agricultural research and extension support through public agencies and private sector providers as appropriate,
     and facilitation of market linkages for agricultural producers /groups (including fisheries and livestock products.
     Project Management: The objective of this component is to ensure smooth implementation of project activities,
     monitoring of project implementation progress and outputs/ outcomes achieved, and learning from project
     experience. Major activities under this component would include: (i) setting up and supporting project


                                                                                                                    24
    management units at the state and district levels, (ii) project MIS, (iii) internal monitoring, evaluation and
    learning, (iv) services of an external M & E agency to be engaged as consultants for the duration of the project;
    and (iv) information and communications support including establishment of project website and documentation
    of project experience and its dissemination into the wider development community (v) Finance and Procurement.


3. Project Scope & Components

    It is envisaged that the project, to be implemented over a period of 6 years, will support the physical
    rehabilitation/ modernization of about 900 tanks with an estimated CCA of about 120,000 hectares,
    spread across 29 districts of the state. The four broad components of the project are:
    Component A:                     Institutional Strengthening
    Component B:                     Tank Systems Improvements
    Component C:                     Agricultural Livelihood Support Services
          Sub Component C.1          Agriculture & Horticulture
          Sub Component C.2          Livestock
          Sub Component C.3          Fisheries
          Sub Component C.4          Foreshore Area Treatment
          Sub Component C.6          Agri-Business and Marketing
    Component D:                     Project Management

4. Implementation Arrangements
   The overall responsibility for project implementation and coordination would rest with the Orissa Community
   Tank Development and Management Society (OCTDMS) which has been established to serve as a coordinating
   agency for tank rehabilitation in the state. The Governing body of the OCTDMS is chaired by the Agriculture
   Production Commissioner and includes representatives of various line departments and civil society. The
   OCTDMS would consist of a State Project Unit (SPU) and about 21 District Project Units (DPUs). All the
   activities of OCTMP are to be implemented at three levels: State Level, District Level and Tank Level. Both the
   SPU and DPUs would have six cells each
   a) Institution Strengthening Cell, b) Technical Cell, c) Livelihoods Cell, d) Monitoring,  Evaluation and
   Learning Cell, e) Finance and Procurement Cell, f) Communication, Information Dissemination and Disclosure
   Cell.

   At the State level there would also be a State Level Steering Committee to guide and review the activities of the
   OCTDMS, work on policy issues and coordination. At the district level there would be a District Level Steering
   Committee (DLSC) headed by the Chairman (District Collector) for reviewing the work and guiding the DPU as
   well as coordinating with line departments. The District Project Director of the District Project Unit would be the
   Member Secretary of the (DLSC). At both the district and state level, OCTMP would be supported by the Line
   Departments. At the Tank Level, the Pani Panchayat is the nodal implementation partner and the Support
   Organisations would facilitate implementation processes.

5. Objectives of the Audit
    The objective of the internal audit is to provide the project management timely fiduciary assurance that
    the (i) financial management and procurement systems and internal control procedures as applicable to
    the project are being adhered to by the various units, (ii) the financial reports being submitted to the


                                                                                                                  25
    SPU are in agreement with the books of account and can be relied upon to support the disbursements
    made by the Bank
5.1 Coverage and Standards for the Audit: The audit would cover the entire project i.e., covering the
    implementing units at the Project level (SPU and DPU) and at village level, the Pani Panchayats on a sample
    basis i.e. at least 10% of Pani Panchayats under each DPU. The audit would also cover all consultancies or
    other contracts that may be entered into by the implementing agencies. The internal audit should be carried out
    in accordance with the Auditing & Assurance Standards prescribed by the Institute of Chartered Accountants of
    India and will include such tests and controls, as the auditor considers necessary under the circumstances.
    Specific areas of coverage of the audit will include the following:
5.1.1    Project level (SPU and DPU)
    a) An assessment of the adequacy of the project financial management system, including internal controls.
         This would include aspects such as adequacy and effectiveness of accounting, financial and operational
         control; level of compliance with the OCTMP Financial Rules and Regulations;
    b) Efficiency and timeliness of the funds flows to the SPU, DPU, Pani Panchayats and other
       implementing Agencies.
    c) Whether the accounts of the project are compiled in a timely manner and the expenditures
       consolidated on a monthly basis at the SPU level.
    d) An assessment of compliance with provisions of financing agreements (Financing Agreement and
       Project Agreement), especially those relating to procurement, accounting and financial matters.
    e) Review the adequacy of financial and administrative delegation at the district level and examine
       whether any contracts are delayed/ broken up due to lack of adequate delegation;
    f) Goods, works and services financed have been procured in accordance with the World Bank
       procurement guidelines, procurement manual of the project and financing agreements; While doing
       so, the checklist attached with this TOR (Annex 1) will be followed by the internal auditor.
    g) All necessary supporting documents, records, and accounts have been kept in respect of all project
         activities and that clear linkages exist between accounting records, accounts books and the periodic
         financial reports (internal and external i.e Interim Financial Reports)
    h) Adequate records are maintained regarding the assets created and assets acquired by the project,
       including details of cost, identification and location of assets and ensuring that there is a system of
       physical verifications of assets
    i)   With respect to civil works executed under OCTMP by Minor Irrigation wing of DoWR, check to
         ensure that contract registers have been maintained and updated; running bills are properly
         approved and in agreement with the Measurement Book; advances are properly adjusted and
         statutory deductions have been made;
    j)   Inter unit fund transfers and bank reconciliations have been carried out on a monthly basis.




                                                                                                                26
    k) With respect to fund releases to PPs, adequate records of the Financing Agreements have been maintained
        at each DPU and that the DPUs have maintained a record of monthly/quarterly financial statements and
        annual audit reports have been maintained;
    The auditor is expected to obtain and satisfactorily document sufficient audit evidence to support audit
    conclusions.

5.1.2 Village Level

    In case of audit of Pani Panchayats specific consideration will be given to the following -
    a) Pani Panchayats have maintained the books/records as per the Orissa Pani Panchayat Act, 2002, to
       account for funds received from the project, water charges and other income and expenditures are correct
       and decisions taken by the General Body, Executive Committee and its constituent sub committees are
       appropriately reflected in the minute.
    b) The reports and other documents submitted by the Pani Panchayats to the DPU provide clear linkages with
       the books/records and reflect the correct position.
    c) The transactions are supported with necessary documents/bills/vouchers and are approved by competent
       authority and forum.
    d) Goods, materials and services have been procured in accordance with the Pani Panchayat Manual.
    e) Balance in Bank accounts, with third parties and the Project are duly reconciled.
    g) Social accountability, transparency/ disclosure and social audit mechanisms, prescribed in the TAGAP, are
       being adhered to by the Pani Panchayat and there exists documentation evidencing compliance. (please
       document the nature of evidence obtained)
6. Period, Timing and sample coverage of Internal Audit
    The Internal Audit will be for the period of two years and will be carried out on a quarterly basis. The selected
    firm(s) will submit in advance and agree with the SPU a ‘schedule of audit’ in a manner that will allow each of
    DPUs to be covered.
7. Reporting
7.1 Quarterly Reporting: The Auditors will provide a quarterly report including a separate chapter on Procurement
    review of contracts for the units audited (a summary of the key findings, implications and recommendations by
    each District – including the Pani Panchayats covered, must be prepared and will be prepared and discussed
    with the District Project Director to enable the Project Management to take timely action. The report should be
    discussed and agreed with the auditable units and should be structured in a manner giving the observations, the
    implications of the observations, the suggested recommendation and the management comments/ agreed
    actions. The audit observations should be supported by instances and quantified, as far as practicable.
    The individual audit reports should be submitted within 45 days of the completion of the audit of a
    particular district. The reports will be directed as under –
     The Project Management Letter to the Project Director, OCTDMS.
     The individual audit reports to each of the auditable unit to the head of the unit.


                                                                                                                  27
    In addition the internal auditor should provide an Executive Summary highlighting the critical
    issues which require the attention of the Project Director, OCTDMS and the status of actions on
    the previous recommendations.


7.2 Format of the Management Letter: The Management Letter will inter alia have the following sections
       -
           Objectives of the audit;
           Methodology of the audit;
           The status of implementation of the financial management system;
           The status of compliance of the previous audit reports, including major audit observations
            pending compliance;
           The key areas of weaknesses that need improvement; and
           Recommendations for improvements.


8. Qualification of the Auditing Firm(s)
8.1 The Audit firm applying for the assignment should possess the following qualifications.
       The firm should have a standing of at least fifteen years.
       The firm must have at least four partners exclusively engaged in the affairs of the firm, of whom at
        least two partners should be Fellow Chartered Accountants.
       The Firm should have at least one partner with continuous association with the firm of not less than
        ten years and one partner with continuous association of not less than 5 years and adequate
        qualified staff to be able to carry out the assignment.
       The firm should be empanelled with the Comptroller and Auditor General of India.
       Each audit team would be led by an Audit Partner with a minimum of 12 years of post- qualification
        experience as a practicing Chartered Accountant. The anticipated input of the team leader is about
        180 working days each year. Day-to-day management of the audit should be the responsibility of
        an Audit Manager/Partner with at least 5 years of post-qualification experience. The audit firm
        should be able to deploy adequate number of audit staff comprising of qualified, semi – qualified
        and unqualified assistants.
9. General
    The auditor would be given access to all documents, correspondence, and any other information
    relating to the Project and deemed necessary by the auditor. The auditor should become familiar with
    the Project, and with the relevant policies and guidelines of the World Bank (including those relating to
    disbursements, procurement and financial management and reporting). The auditor would be provided
    copies of the Project Implementation Plan, Project Appraisal Document (PAD) of the World Bank,
    Development Credit Agreement and Project Agreement with IDA (including agreed Minutes of
                                                                                                          28
negotiations), the Project Implementation Plan, the Pani Panchayat Manual, Procurement Manual,
Financial Management Manuals, guidelines, policies and procedures issued by Project Management
and the relevant World Bank policies and guidelines.




                                                                                           29
                                                                                                       Annexure-1
Orissa Community Tank Management Project
Terms of Reference for Internal (Concurrent) Audit
Checklist for Internal Audit Procurement
a) The purpose of this checklist to guide the internal auditors in the procurement audit process so that all the
   aspects of the procurement process are looked into and the approach has consistency across the state.
b) Before conducting the procurement audit, the auditors should familiarize themselves with the agreed
   procurement procedures for OCTMP as provided in the legal agreements for the project.
c) Audit report should be submitted as part of the financial audit report but as a separate section not exceeding
   total 10 pages in length.
d) The audit should cover both qualitative aspects (Checklist #1) as well as transaction specific aspects
   (Checklist #2 & 3). These checklists are only to guide the auditors in taking up the procurement audit in
   systematic fashion and are not required to be submitted along with the audit report.
Checklist 1: Qualitative Aspects of Procurement
1a.) Please review and comment on the record keeping system? Is retrieval of documents time consuming or are
     documents readily available?
1 b. )Whether any manual on procurement procedure have been prepared and are available on the website? If no, how the
      procurement procedure is guided?
1c.)Are approved procurement plans available?
2) Whether the Bank’s standard bidding documents are used for preparation of tenders etc.? If no, how the tenders are
    prepared?
3)   Whether dedicated procurement staffs are in place? If no, who handles the procurement?


4) Whether the staffs handling the procurement have exposure or training related to the procurement?
5) Whether complete list of contracts issued is available? Whether these data are computerized?
6) Whether the procurement related documents are available systematically?
7) Whether internal approvals are taken for inviting quotations/placing orders?
8) Whether financial negotiations are conducted frequently? If yes, under what circumstances and with whom
   (with all or lowest bidder)?
9) Is there a procurement related compliant handling system in the agency? If yes, whether bidders are aware
   of the same?
10) Whether the agency discloses the bid opportunity, put the tender documents and contract award information
    on its website?
11) Whether a procurement plan is available? If yes, whether the actual progress is being monitored against the
    plan? If there are delays, what measures are being taken to cover the delays?



                                                                                                              30
12) Whether any procurement related irregularities were reported in the previous audit report? If yes, what
    actions have been taken in this regard?
13) Whether there is separation of duties between various functions viz. indenting/receiving, procurement and
    releasing funds?
14) Feedback from procurement staff and other officials met on how to reduce delays and improve the process
Checklist 2: Procurement of Works/Goods
1) Whether the method of procurement (based on the estimated value) adopted is in accordance with the
   Project Agreement and are these in line with the approved procurement plan? If no, list the deviations
   (major/minor)
2a.) Whether bidding document used for this work is according to the standard model cleared with the
    Bank? If no, list the deviations from standards (major/minor)
2b.) Are estimated cost for each procurement available. What is the basis for preparation of estimated
    cost and is market conditions taken into consideration while finalising the estimated cost.
3) Whether price adjustment clause provided in the bid document? (Required when period of completion
   is more than 12 months)
4) Whether bill of quantities provides schedule of quantity for each slice separately and also one schedule
   for the combined work/goods?
5) Whether the guidelines have been followed in fixing the Bid Security? If not, why?
    (No exemption should be permitted to any bidder or any class of bidders)
6) Whether any preference on price or other conditions allowed in the bidding document/award for any
   bidder or class of bidders? If yes, list the preferences.
    (No preferential treatment should be given to any bidder or class of bidders either for price or for
    conditions unless specifically cleared with the Bank and stipulated in the Project Agreement.)
7) Whether the Cost of bidding documents is reasonable?
8) Whether the Notice inviting tender (NIT) published in national newspapers?
9) Whether minimum 30 days provided for sale of bid documents or from date of publication of NIT
   whichever is later?
10) If pre-bid conference was held, whether the minutes were prepared and circulated to all the prospective
    bidders?
11) Whether the last date of receipt of bids and the date of opening of bids are different (Both should be the
    same)
12) Whether bids were evaluated as per the criteria given in the bid document?
13) Has award been made to the lowest responsive bidder? (Award should be made to the lowest
    responsive bidder.) If no, the reasons for ignoring lower offers?
14) Were any negotiations held with the bidders after opening of bids? If yes, whether Bank's clearance
    was obtained before holding negotiations and when? If Bank's clearance was not obtained why? (Bank
    does not favor any negotiations.)


                                                                                                           31
15) Whether the award was made within the original bid validity?
    i)   if no, what are the reasons for delay?
    ii) if extension of bid validity was sought, was that from all bidders and not from the lowest alone?
    iii) Was the period of extension exceeded 8 weeks?
    iv) If affirmative, was Bank’s clearance obtained?
16 a.) Has the contract award been published / disclosed? Were any complaints received?
16b) Has the successful bidder furnished performance security in accordance with the conditions of
   contract?
17 a.) In case of works were the site handed over in time. Have the works or goods delivered within the
    time period indicated in the contract? If there has been delay has liquidated damages been deducted
    as per the provisions of the contract
17b ) Whether Items received/work completed as per the schedule indicated in the contract document?
18) Whether payment released timely and as per the terms given in the contract?
19) Whether the assets procured are being utilized for the intended purpose?
20) Whether all the documents/records related to the contract were available?
Checklist 3: Selection of Consultants
1) Whether the method of selection adopted is in accordance with the Project Agreement / approved
   procurement plan
2) Whether the terms of reference include the following?
    i)   Concise statement of objectives
    ii) Outline of tasks to be carried out
    iii) Schedule for completion of tasks
    iv) Support/ inputs to be provided by the employer
    v) Final outputs required from the consultant
    vi) Review procedures
3) Whether the terms of reference have been reviewed and cleared with the Bank?
4) Whether the cost estimate has been prepared (Cost estimate, or budget, should be based on
   borrower's perception of the assignment requirements in terms of level and type of personnel, period to
   be spent in the field and in the home office, physical inputs and other items required for the services.)
5) Whether a short list of the consultants/ consultant firms has been drawn? (The short list should have 6
   consultants)
6) Whether the draft letter of Invitation with draft or contract according to the Bank’s standard document?
   If not/reasons thereof.
7) Whether at least 30 days given for submission of proposals
8) Whether the proposals were evaluated as per criteria set out in the Letter of invitation.

                                                                                                            32
9) Whether the financial proposals opened in presence of technically qualified consultants?
10) Whether the financial negotiations were held with the highest ranked firm (financial negotiations are not
    allowed if price is a factor for selection)
11) Whether proposals were evaluated as per the criteria given in the RFP document?
12) Has award been made to the highest ranked consultant? (Award should be made to the consultant
    scoring highest rank based on evaluation of technical and financial proposals)? If no, the reasons for
    ignoring the highest ranked proposal?
13) Has the contract award been published / disclosed and were any complaints received ?
14 Whether the award was made within the original proposal validity? If no, what are the reasons for
   delay?
15 ) Whether the assignment completed as per the schedule indicated in the contract document?
16) What controls are present for verification of invoices before releasing payment? (For e.g. in case of
    time based contract how are the man days, reimbursable expenses etc verified?)
17) Whether payment released timely and as per the terms given in the contract?
18) Whether all the documents/records related to the contract were available?




                                                                                                          33
                                                                                             Appendix B

                                     Reporting Requirements


1. An inception Report in the first week with work plan details ( 5 Hard Copies and 5 Soft
   Copies) Reporting
 2. Quarterly Reporting: The Auditors will provide a quarterly report including a separate chapter on
Procurement review of contracts for the units audited (a summary of the key findings, implications and
recommendations by each District – including the Pani Panchayats covered, must be prepared and will be
prepared and discussed with the District Project Director to enable the Project Management to take timely
action. The report should be discussed and agreed with the auditable units and should be structured in a manner
giving the observations, the implications of the observations, the suggested recommendation and the
management comments/ agreed actions. The audit observations should be supported by instances and
quantified, as far as practicable.
The individual audit reports should be submitted within 45 days of the completion of the audit of a
particular district. The reports will be directed as under –
 The Project Management Letter to the Project Director, OCTDMS.
 The individual audit reports to each of the auditable unit to the head of the unit.
In addition the internal auditor should provide an Executive Summary highlighting the critical
issues which require the attention of the Project Director, OCTDMS and the status of actions on
the previous recommendations.


Format of the Management Letter: The Management Letter will inter alia have the following sections -
       Objectives of the audit;
       Methodology of the audit;
       The status of implementation of the financial management system;
       The status of compliance of the previous audit reports, including major audit observations
        pending compliance;
       The key areas of weaknesses that need improvement; and
       Recommendations for improvements.
   3.Final Report:

    All the reports would be modified and finalized incorporating changes to accommodate
    comments from client and Bank. 20 (twenty) hard copies and an electronic version (soft
    copy) shall be provided by the Consultant.



                                                                                                            34
All these reports shall be presented and discussed in OCTDMS Office by the Review
Committee. The comments and suggestions given by the GoO and the WB will be
addressed while finalizing the report. Power point presentations of all the above reports
should be prepared and submitted for discussion during review.

 Composition of Review Committee to monitor consultant’s work:
A committee consisting of following members shall coordinate and monitor the
Consultant’s work and would extend their cooperation in making available the data and
information, and obtaining approvals and also deal with the problems, if any, faced by the
Consultant in executing the Contractual obligations.
               a.     The Project Director- cum – Special Secretary to Govt.

               b.     The Chief Engineer (Minor Irrigation), Orissa.

               c.     Project Finance Officer.

               d.     Procurement Expert, OCTDMS.

               e.     Financial Management Expert OCTDMS

 The Committee shall co-opt any additional member, if needed, with the approval of the
                             Project Director, OCTDMS.




                                                                                        35
                                               Appendix C

                               Key Personnel and Sub-consultants

                                (Refer Clause 4.1 of the Contract)


    List under: C-1 Titles [and names, if already available], detailed job descriptions and
                      minimum qualifications and experience of Personnel to be assigned to
                      work in India, and staff-months for each. .
      Professional Staff from Ray Ghosh & Associates,.Chartered Accountants
       Name of Staff       Area of            Position           Task Assigned
                           Expertise          Assigned
       Subrata Roy          Audit,            Team Leader        Overall coordination &
                           Taxation, GFR,                        planning, team leadership,
                           Government                            reporting, liaison with client
                           Codal
                           Accounting &
                           Evaluation
                           Study
       Nitin Agarwal        Audit, GFR &      Audit Manager Responsibility to lead the audit
                           Evaluation                            teams in the field, planning and
                           Study                                 execution of the audits,
                                                                 discussion with head of the
                                                                 office at state and reporting
                                                                 writing and finalization.
       1.Sanjay Aich        Audit, Budgets Auditor               Field level Audit (Including
                           and                                   visits to a sample of Pani
       2.Sushil Bhakat Procurement                               Panchayats)
                           Audit



                  C-2   Same as C-1 for Key foreign Personnel to be assigned to work outside
                        India.
                                                                        - Not Applicable

                  C-3   List of approved Sub-consultants [if already available]; same information
with respect to
                        their Personnel as in C-1 or C-2.               - Not Applicable


                  C-4   Same information as C-1 for Key local Personnel.- Not Applicable




                                                                                               36
                              Appendix D

    Breakdown of Contract Price in Foreign Currency – Not Applicable


.




                                                                       37
                                         Appendix E

                      Breakdown of Contract Price in Local Currency


           1.Monthly rates for Personnel (Key Personnel and other Personnel)

               Name                                Position              Staff- month rate
                                                                         (INR)
               Subrata Roy                         Team Leader                  60,000.00
               Nitin Agarwal                       Audit Manager                50,000.00
               1.Sanjay Aich                       Auditor- Home                15,000.00
               2.Sushil Bhakat
                                                              - Field           18,000.00

         2..   Reimbursable expenditures.  .
                 No            Description                       Unit       Unit cost (INR)
                  1    Per diem allowances                       Day             750.00
                  2    Miscellaneous travel expenses             Trip            500.00
                 3.    Drafting, reproduction of               Pre Set          1000.00
                       reports


    2.Reimbursable expenditures.:( Based on actual expenditure and subject to prior
    approval of the tour programme/additional services so required , by the Project Director,
    OCTDMS limiting to amount noted against each period of Assignment below)

               To be given separately a) For Year 2009-2010 – INR 1,76,480.00
                                      b) For Year 2010-2011 – INR 2,76,853.00


This appendix will exclusively be used for determining remuneration for additional services.




                                                                                              38
                                                                                   Appendix F


                          Services and Facilities Provided by the Client


Provide space for consultative meetings. It is expected that the consultant team will be in close
and constant touch with the client and his designated team during the period of the assignment.
The space will be provided to facilitate the interaction and review of this assignment.

           a. Provide available data and information that would be relevant to carry out the
                assignment (including documents from the past, ongoing, proposed projects in the
                region and other relevant information, required qualification of staff and salaries);

           b.   Help, identify, contact in the project areas, when required, and facilitate
                consultation with agencies potential project beneficiaries and others.

           c. Make available copy of World Bank Operational policies and guidelines relevant
                to the needs of the agency.
           d. Memorandum of Agreement and Rules of the Society will be provided after
                signing of the contract.


       The Consultant would get support of the Project Team throughout the assignment period.
The Consultant would be responsible for all transport and accommodation at project sites and in
Bhubaneswar. All requirements regarding the Data Services and facilities will be informed to the
OCTMP well in advance (preferably in the first week of the Consultancy).




                                                                                                   39
                                                                                           Appendix G

                                   Bank Guarantee for Advance Payment

        [To be stamped in accordance with Stamp Act, if any, of the Country of Issuing Bank]


_____________________________ [Bank’s Name, and Address of Issuing Branch or Office]

Beneficiary: _________________ [Name and Address of Client]

Date: ________________

ADVANCE PAYMENT GUARANTEE No.:                                 _________________

We have been informed that [name of Consulting Firm] (hereinafter called "the Consultants")
has entered into Contract No. [reference number of the contract] dated [insert date] with you,
for the provision of [brief description of Services] (hereinafter called "the Contract").

Furthermore, we understand that, according to the conditions of the Contract, an advance
payment in the sum of [amount in figures] ([amount in words]) is to be made against an advance
payment guarantee.

At the request of the Consultants, we [name of Bank] hereby irrevocably undertake to pay you
any sum or sums not exceeding in total an amount of [amount in figures] ([amount in words])1
upon receipt by us of your first demand in writing accompanied by a written statement stating
that the Consultants are in breach of their obligation under the Contract because the Consultants
have used the advance payment for purposes other than toward providing the Services under the
Contract.

It is a condition for any claim and payment under this guarantee to be made that the advance
payment referred to above must have been received by the Consultants on their account number
___________ at [name and address of Bank].

The maximum amount of this guarantee shall be progressively reduced by the amount of the
advance payment repaid by the Consultants as indicated in copies of certified monthly statements
which shall be presented to us. This guarantee shall expire, at the latest, upon our receipt of the
monthly payment certificate indicating that the Consultants have made full repayment of the
amount of the advance payment, or on the __ day of ___________, 2___,2 whichever is earlier.

1
    The Guarantor shall insert an amount representing the amount of the advance payment and denominated either in
    the currency(ies) of the advance payment as specified in the Contract, or in a freely convertible currency
    acceptable to the Client.
2
    Insert the expected expiration date. In the event of an extension of the time for completion of the Contract, the
    Client would need to request an extension of this guarantee from the Guarantor. Such request must be in writing

                                                                                                                  40
Consequently, any demand for payment under this guarantee must be received by us at this office
on or before that date.

This guarantee is subject to the Uniform Rules for Demand Guarantees, ICC Publication No.
458.

_____________________
     [signature(s)]

Note: All italicized text is for indicative purposes only to assist in preparing this form and shall
      be deleted from the final product.

       The date will be fixed as indicated in Clause 6.4 of S.C.C.

       The stamp papers of appropriate value shall be purchased in the name of bank which
       issues the ‘Bank Guarantee’.

       The Bank Guarantee shall be issued either by a bank (Nationalized/Scheduled) located in
       India or a foreign bank through a correspondent bank (scheduled) located in India or
       directly by a foreign bank which has been determined in advance to be acceptable to the
       Client.


      [To be stamped in accordance with Stamp Act, if any, of the Country of Issuing Bank

 and must be made prior to the expiration date established in the guarantee. In preparing this guarantee, the Client
 might consider adding the following text to the form, at the end of the penultimate paragraph: “The Guarantor
 agrees to a one-time extension of this guarantee for a period not to exceed [six months][one year], in response to
 the Client’s written request for such extension, such request to be presented to the Guarantor before the expiry of
 the guarantee.”




                                                                                                                 41
                      Consultant’s Representation Regarding Costs and Charges




                  [Expressed in INR]


     Personnel                 1               2           3       4       5        6              7             8
 Name                     Basic Salary        Social   Over Sub        Fee      Away from      Proposed       Proposed
                          per Working        Charges   heads total     2*      Headquarters    Fixed rate    Fixed Rate
             Position        Month                                              Allowance
                                               1*                                             per Working        per
                                                                                                 Month        Working
                                                                                                               Month
    Home Office

Subrata     Team         60,000          -             -       -       -       -               60,000        60,000
Roy         Leader
Nitin       Audit        50,000          -             -       -       -       -               50,000        50,000
Agarwal     Manager
            Auditor      15,000          -             -       -       -       -              15,000         15,000
Sanjay
Aich
Sushil      Auditor      15,000          -             -       -       -       -              15,000         15,000
Bhakat
          Field

Subrata     Team         60,000          -             -       -       -       -              60,000         60,000
Roy         Leader
Nitin       Audit        50,000          -             -       -       -       -              50,000         50,000
Agarwal     Manager
            Auditor      18,000          -             -       -       -       -              18,000         18,000
Sanjay
Aich
Sushil      Auditor      18,000          -             -       -       -       -              18,000         18,000
Bhakat




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