• Since May 2007, by when C-1 had come under the scanner of both the CBI and IT— it was raided in October 2006 — the company has had “authorization” from DGS&D to act as the service provider for e-tendering in all Government organizations. This decision has been challenged in the Delhi High Court and is now being examined by the Central Vigilance Commission.

• Investigations have found that after the original 2004 contract signed between DGS&D and C 1 — the company was selected after a limited tender — the former issued an amended clause on May 22, 2007 titled “key services to be offered by the service provider (C 1) to Government organizations willing to avail DGS&D e-procurement platform.” A definition was added in the circular describing “Government Organisations” as: all Central and State Government Departments, PSUs, Autonomous bodies, local bodies and Co-operatives.

• With the Ministry of Finance having made e-tendering mandatory for all Government Departments from July 1, 2007, C 1 was named repeatedly as the sole service provider in the DGS&D circular.

• But in a departure from earlier contracts C-1 signed with clients, following the DGS&D circular, it was DGS&D which signed five-year MoUs with Government Departments which were then routed to C1 for e-tendering requirements.

• While DGS&D earns Rs 25,000 as development fee per department, C1 gets Rs 6,000 annually from each vendor/supplier. The number of suppliers run into thousands each department.

• The DGS&D has told The Indian Express that Government Departments were under “no compulsion” to use its e-tendering platform and it was only an “option” given to them. On its website, however, the DGS&D has posted an “important notice” informing vendors suppliers and Government Departments about mandatory e-tendering. And adding: “For e-tendering the vendors are advised to contact M/s C 1 India.”

... contd.