1 As Is Business Process

The section describes the current as-is business process being conducted at SPMCIL.

1.1 Key Points

Scrap generated in SPMCIL premises can be broadly categorised into Metal scrap, wooden scrap, cut paper etc. Scrap doesnt have any inventory value but only sale value which is decided by disposal committee in SPMCIL. Also, such scrap is not quantified at SPMCIL Units; only Stores persons maintain estimated rough figures. Metal scrap (Scissels, defaced dies etc), Wooden scrap (Pallets, Packing wood boxes etc) , Cut paper, damaged motors, cables etc generated from Production and maintenance sections are identified as unserviceable by User sections. The items have completed its expected useful life, and are no longer operational, or in use of various categories of items are to be decided by user department officers and approved by WM. CPSO may initiate the process of disposal at the end of annual inventory audit for their respective departments. List of approved disposable items is forwarded by the CPSO to the Surplus Disposal committee. Disposable goods of assessed residual value above a specified value, to be decided by the GM, should be disposed of by either obtaining bids through advertised tender or public auction. The book value and the reserve price of the surplus item are important considerations in disposal. In case book value is not readily available, the original purchase price of the surplus item may be used to calculate book value by factoring the original price with an appropriate rate of depreciation. Disposal Through Advertised Tender process Refer SCN_MM_PR_02 & SCN_SD_08 In case the total quantity to be disposed of cannot be taken up by the highest acceptable bidder, the remaining quantity may be offered to the next higher bidder(s) at the price offered by the highest acceptable bidder. The subcontract department finalises the rate contract for all categories of scrap every year. Scrap will be disposed at this rate till the next contract/rate is finalised. Once the Demand draft/ advance payment is received from purchaser, a sales delivery document & sale invoice will be generated by yard-upkeep cell and material released to purchaser. If the Department is unable to sell any surplus or obsolete or unserviceable item in spite of its attempts through advertised tender or auction, it may dispose off the same at its scrap value with the approval of the competent authority in consultation with Finance division. In case the Department is unable to sell the item even at its scrap value, it may adopt any other mode of disposal including destruction of the item in an eco friendly manner after GMs approval.

The competent authority may, at his discretion, constitute a committee at appropriate level to declare identify item(s) as surplus or obsolete or unserviceable item(s). The committees for surplus scrap disposal and condemnation is as follows: Surplus Disposal Committee All SPMCIL Units constitute a Surplus Disposal Committee for approving the recommendations of disposal of condemned/surplus/ obsolete items and the disposal process. Evaluate users request for disposal against available data on book value. Decide whether the goods recommended for disposal by competent authority or inventory audit, should be disposed off, or retained in inventory, and categorize disposable goods into surplus/unserviceable/condemned/ obsolete/ unusable / scrap with reasons for disposal. Consider and approve recommendations of the TEC and select preferred bidder Purchase PO CPSO Fin & Accounts Section Officer FA&CAO Chairman DGM GM

Estimated value in INR Up to 50,000 Above 50,000 Condemnation Committee

All SPMCIL Units constitute a Condemnation Committee for approving the recommendations of disposal of surplus/ obsolete items and condemning capital and security items. The committee will be composed of the following members: Purchase SO, CCO, DWM (User section) WM, CE, FA&CAO DCE (Engg and Maintenance), PO, SO

Type of material Security revenue item Security Capital Non Security Capital