SUBJECT: SCAM TAINTED PROCUREMENT OF ANALYTICAL WEIGHING BALANCE IN DMSRDE, KANPUR 

 COMPLAINT AGAINST

1. MR. AMIT SARAIYA, SCIENTIST ‘D’, HEAD MATERIALS MANAGEMENT GROUP (2011-2013),
2. MR. SHIELANDRA KUMAR  SCIENTIST ‘E’, HEAD MATERIALS MANAGEMENT GROUP (2013),
3. MR.R K JAIN, SCIENTIST ‘E’ CHAIRMAN, ‘VENDOR REGISTRATION COMMITTEE’
4. DR. D. N. TRIPATHI, CHAIRMAN, ‘TECHNICAL EVALUATION COMMITTEE’(TEC)
5. DR. T. C. SHAMI, CHAIRMAN, ‘STORES PRUCHASE COMMITTEE’(SPC)
6. DR. ARVIND KUMAR SAXENA, DIRECTOR & CFA, DMSRDE, KANPUR

Sir,

BRIEF FACTS OF THE COMPLAINT 

1. Defence Materials & Stores Research & Development Establishment (DMSRDE), Kanpur is an establishment under Defence Research & Development Organisation (DRDO), Min. of Defence, DRDO Bhawan, New Delhi.

2. Purchase Management 2006 is applicable for procurement of store items in DRDO. Gross irregularities and violation of Purchase Management 2006 was made in procurement of Analytical Weighing Balance in year 2012-2013 when the cases were indented by officers of Material Management Group under illegal orders of Head MMG & Dr. A. K. Saxena, Director, DMSRDE.

3. Dr. A K Saxena Director is an incompetent, arrogant and corrupt administrator who has not only violated but also subverted all rules and regulations of purchase.  In earlier complaints pending with Central Vigilance Commissioner at New Delhi and now in the present case, it becomes amply clear that he is the not only the ‘CENTRE OF GRAVITY’ but also ‘PATRON-IN-CHIEF’ of corruption menace in DMSRDE.  Relevant rules and regulation of DRDO PURCHASE MANUAL-2006 for the execution of procurement are a mentioned below:

• Para 4.6.2 of DRDO purchase manual 2006 Corrigendum 03 clearly  states: 4.6.2 For demands for stores above Rs 5 lakh, the level for initiation for putting up to SPC/DRDO HQrs/ various committees with delegated powers under various programmes and projects will be as under: (a) Above Rs 5 lakh to Rs 25 lakh: initiation by Scientist ‘C’/ TO ‘C’ and above, countersigned by project or group head. (b) Above Rs 25 lakh to Rs 50 lakh: initiation by Scientist ‘D’/ TO ‘D’ and above, countersigned by project or group head. (c) Above Rs 100 lakh and above: initiation by Scientist ‘E’ and above, countersigned by project or group head.

• Para 5.1.1 of DRDO PURCHASE MANUAL 2006 clearly states that  following cautions shall be observed for purchasing stores:

• Bulk purchases will normally fetch quantity discount. This should, however, not lead to over-stocking resulting in expiry of shelf life or redundancy due to obsolescence.
• Purchase orders will not be split-up to avoid the necessity for obtaining sanction of the higher authorities.
• Open tendering should be adopted to ensure fair competition, unless it is considered expedient to follow other modes of tendering due to urgency. Purchases will be made from the lowest acceptable tenderer. Adequate care would be exercised to ensure that delivery from the vendor is within the specified time schedule.

• Para  7.6 Corrigendum 02 of DRDO PURCHASE MANUAL 2006 clearly states: LIMITED TENDERS: This mode of tendering may be chosen when estimated value of goods to be procured is up to Rs. 25 lakh (Rupees Twenty five lakh).  Purchase through Limited Tender Enquiry may also be adopted even where the estimated value of the procurement is more than Rs 25 lakh, in the following circumstances as per the delegated financial powers in vogue.

(a)  When the sources of supply are definitely known and are limited.

(b)  When it is not in the public interest to call for open tenders due to reasons of security or when superior authorities have issued specific instructions in this regard.

(c)  When Government policies designate specific agencies.

(d)  When open tender system adopted during previous one year has established sufficient and assured sources of supply at competitive rates.

(e)  When the requirement of stores is urgent and the desired delivery schedule cannot be met if open tenders are invited, the indenting officer must place on record, the nature of the urgency and why the demand could not be anticipated earlier. Urgency of such cases will be specifically monitored till the placement of order.

(f)   EPC approval issued by DMM in all cases shall include the names of the vendors to whom the Tender enquiries must necessarily be sent in addition to others.

• Para 7.6.3 of DRDO purchase manual 2006 clearly  states: “The limited tender enquiries will be floated to all registered firms with a minimum of seven such firms for the concerned item(s). In a case where the number of registered firms is less than seven, these enquiries will be issued to all known firms dealing with the stores and efforts made in this regard will be recorded on the file”. Corrigendum 03 clearly  states: “Add: at the end of the para 7.6.3:  Vendor selection for the purpose of Limited Tender enquiries must be done with utmost diligence so as to give fair opportunity to all known vendors who are willing and eligible for consideration. The enlistment and delisting of registered vendors should be based on clearly laid down criteria and the existing provision for buildup followed rigorously  by periodically referring to vendors registered with R&D Labs/ Estt., DGS&D, NSIC, other Government  Departments and to the firms of national repute who will be registered before their bid is considered.”

• Para 7.13.3 of DRDO purchase manual 2006 clearly  states: Scrapping of tenders will be resorted to in the following cases with the approval of the Director:
  • Change in basic specifications governing supplies after opening of tenders.
  • Non-receipt of offers as per specifications laid down.
  • Sudden downward market trend.
  • Prices quoted being very high/unreasonable.
  • Large/manifold variation in tendered prices.
  • Para 3.2 of DRDO purchase manual 2006 clearly  states: REGISTRATION OF VENDORS: The vendors will be registered by Labs/Estts for different categories of stores, e.g., raw materials, chemicals, machine tools, instruments, electronics and electrical items, timber, fabrication jobs and other general stores etc. The credentials of firms seeking registration will be verified to ascertain their credibility with regard to financial standing i.e. annual accounts, capacity, reliability, bonafides (income-tax returns sales tax No. etc.) and past performance, etc. For this purpose, specialists from the respective fields will be included in the Vendor Registration Committee while examining the applications of vendors seeking registration. The registration committee will be appointed for one financial year. The constitution of the vendor registration committee will be as follows:

1. Scientist- F Chairman

2. Scientist- D/E Member

3. Head MMG or Rep Member Secy.

The Chairman can co-opt specialist members if considered necessary.

4.    Mr. Aneesh  Kumar Singh, Scientist ‘C’,  Mr. Amit Sarriya,  Head Material Management Group, Mr. R.K. Jain, Scientist ‘E’ Chairman Vendor Registration Committee Dr. D. N. Tripathi, Scientist ‘F’ Chairman TEC, and Dr. T. C. Shami, Scientist ‘F’, Chairman SPC(above Rs 10 lakh) for    possibly under heavy pressure entered into a criminal conspiracy with Dr. A K Saxena, Director  & CFA of splitting requirement of the same items to fabricate store demands violating  DRDO purchase manual 2006, details of which are mentioned below:

5.    PROCUREMENT IRREGULARITIES OF Analytical Weighing Balance

Central Procurement of Analytical Weighing Balances worth total estimated cost Rs. 52.8 lakh on limited tender basis by splitting requirement into

• 02 demands raised by Mr. Aneesh Kumar Singh, Scientist C of Material Management Group along with Mr. Amit Sarriya Head MMG, on same date 20^th Feb 2013 with exactly same list of pet vendors of Dr. A. K. Saxena, Director , DMSRDE.
• the 02 demands were cleared by the SPC (Store Procurement Committee) dealing cases above Rs. 10.0 lakh, headed by  Dr.  T C Shami, Scientist ‘F’,  as Chairman of SPC 2012,
• Technical evaluation of Techno Commercial Bid  in case of Analytical Weighing Balance was done by a TEC comprising of  Dr. D. N. Tripathi, Scientist ‘F’ Chairman TEC, Mr. A. K. Dixit Scientist ‘E’ (Expert Member),  Mr. Aneesh Kumar Singh, Scientist C(User Member) and Mr. A. K. Mishra Technical Officer ‘C’(Member Secretary). Queries were asked from Vendors vide letter dated 19 June 2013 Kawach Instruments & Chem Tex Noida & Abhigyan Traders, Kanpur was  technically disqualified in TEC report for case at Sl. No.01.
• Respective   supply orders placed during Sep 2013 to Oct 2013.
• Point to be noted that
  • requirement of “Analytical Weighing Balance” received from various user divisions in response to MMG ION (Annexure-I) was  deliberately split into two demands below Rs. 50.0 Lakh to keep it within the lab director CFA power so as to avoid DRDO HQrs  concurrence. These demands were cleared in same SPC meeting held on 07-Mar-2013 and limited tender enquiries were issued on same date 03-Apr-2013 to exactly similar vendors as shown in Table-I below.
  • Only 06 pet vendors are given tender enquiry whereas  as per para 7.6.3 DRDO purchase manual 2006 the limited tender enquiries will be floated to all registered firms with a minimum of seven such firms for the concerned item(s). Further vendors should be selected in accordance to Para 7.6.3-Corrigendum 03 to DRDO purchase manual 2006.
  • Further vendors selection  for the two demands  at Sl.No.01& 02 is improper as:
    • M/s Nav Jyoti Scientific Sales Corporation Lucknow (Reg. No. DMSRDE_013/01C/19_10L for Chemicals, Instruments) and M/s Kawach Instruments & Chem Tex Noida (Reg. No. DMSRDE_012/03C/073_10L for Chemicals, Instruments, Textiles,) were registered in 2013  for supply orders limited up to Rs 10.lakh then how these vendors were selected for tender inquiry for cases costing above  Rs. 10 Lakh
    • M/s Abhigyan Traders, Kanpur (Reg. No. DMSRDE_07/03C/044 for Chemicals) and M/s National Industrial Corporation (NIC) Kanpur (Reg. No. DMSRDE_11/03C/61 for Chemicals) are registered in DMSRDE only for Chemicals supply then how they were selected for tender inquiry for Scientific Equipment.
    • Demand for such specialized equipment is raised by Material Management Group centrally based on requirements submitted  by user divisions under pressure of Dr. A K Saxena, the Director,  in response to the ION issued by Material Management Group(Annexure-I)  despite no demand was raised from user divisions.
    • there is no requirement for this store in such a huge quantity in DMSRDE as it may be  sufficient to provided such costly and specialized equipment in Central Analytical Facility which is equipped with various special purpose sophisticated costly equipment. This is an attempt to create redundant facilities leading to underutilization of the equipment and this can be treated as wastage of poor tax payers money.

 6.    Point to be noted that

Dr. A. K. Saxena, the Director, has got registered more than fifty of his pet vendors in year 2013 through formulation of an illegal Vendor Registration committee with his pet man Mr. R.K. Jain Scientist ‘E’ as Chairman despite the fact that there are more competent and honest Scientist’s ‘F’ available in DMSRDE who are not only underutilized but not even acknowledged.. This  is a clear cut violation of para3.2 of DRDO purchase manual 2006 by Dr AK Saxena, for placement of the supply  order on limited tender to known vendors clearly exhibit his vested interest through manipulation  in prices, quality etc so as to fetch financial benefits hence indicates financial corruption/ corrupt practices of giving business/ benefits to own firms.

• Details are as show in Table-1

• Table-I

Point to be noted

• For Analytical weighing balance at Sl.no.01
  • As per Para 4.6.2 DRDO purchase manual 2006 Corrigendum 03 Scientist ‘C’ can raise demand up to Rs.  25.0 lakh.
  • This limited tender above Rs 25 lakh violates Para 7.6 DRDO purchase manual 2006 Corrigendum 02.
  • Placement of supply order worth Rs. 30.92 (costing  close to  estimated cost Rs 33.6 lakh) on limited tender basis  to known local/pet vendor M/s Nav Jyoti Scientific Sales Corporation Lucknow, clearly exhibit vested interest through manipulation  in prices, quality etc so as to fetch financial benefits hence indicates financial corruption/ corrupt practices of giving business/ benefits to own firms
• For Analytical weighing balance at Sl.no.02
  • The Demand for Dual Range High Precision Semi Micro Balance with Density Determination Kit is exorbitantly estimated at the rate of Rs 6.4 Lakh (i.e. Total cost for 03 No. Rs 19.2 Lakh ) as:

• Similar Semi Micro Dual Range High Precision Analytical Balance with Density Determination Kit was procured by a user division vide demand dated in 08-Aug-11 and supply order dated 19-Dec-2011 at the rate of Rs 1.6 lakh from M/s P.D. Scientific Industries, Kanpur.
• For a demand estimated Rs.19.2 lakh the supply order costing Rs 9.7 lakh at the rate Rs 3.3 lakh only was placed to lowest bidder M/s Kawach Instruments & Chem Tex Noida.
• Point to be noted that M/s Kawach Instruments & Chem Tex Noida could not be technically disqualified in this case by the TEC otherwise this supply order also might be costing close to estimated cost Rs 19 lakh as in first case above.  It appears that the first case is exorbitantly estimated too.

• Item nomenclature is slight changed by changing the location of “Semi Micro” at Sl. No. 02 & 03 with a view to create a differentiation.  
• M/s P.D. Scientific Industries Kanpur was not considered for the said tender enquiry otherwise prices might have lowered further in order of case at Sl. No. 03.
• Scrapping of tenders should be considered in case of sudden downward market trend or Large/manifold variation in tendered prices as per DRDO purchase manual 2006 Para 7.13.3 .

9.      Despite all above placement of the supply  order on limited tender to known vendors clearly exhibit vested interest through manipulation  in prices, quality etc so as to fetch financial benefits hence indicates financial corruption/ corrupt practices of giving business/ benefits to own firms

10.       From the facts stated above, it is amply crystal clear that prima facie material regarding ‘ABUSE OF AUTHORITY’, ‘DICTATORIAL TRAITS ’, ‘PATRONIZATION OF CORRUPTION’ as regards to arrogant and corrupt Dr. Arvind Kumar  Saxena, Director DMSRDE exists.

That he has created a robust cobweb of corruption system’ killed proven departments / institutions in DMSRDE to hold system to ransom. This is evident from the fact that sequentially right from the indenter, head of the Division, whole Stores Purchase Committee including its CHAIRMAN and lastly HEAD MMG have fallen under tremendous pressure into criminal conspiracy to cheat DRDO and exchequer’s money.

In pursuance of the said criminal conspiracy,  Dr. A. K. Saxena, Director, present Head MMG, and Mr. A. K. Singh, Technical Staff Officer of Director, DMSRDE are tampering with evidence / documents that shall be prejudice to fair trial, investigation, trial or any inquiry.

11.      In view of the above mentioned facts and evidences it is earnestly requested that an order for through investigation of all procurement done by Dr.  A. K. Saxena after assuming charge as Director, DMSRDE, DRDO, Kanpur to stop further corruption and wastage of poor tax payers money.

Date: 12^th January 2014

Annexure- ION Bulk Purchasing of Items – File No TPO/Gen/09/N-8Dated 7/9/2012