Reimbursable Expenses of Government Consultants


This query is : Resolved 

Quick Summary
This discussion explores whether a government organisation can reimburse a project management consultant for equipment purchases exceeding Rs 25,000, such as desktops and laptops. While direct payment is possible and GST input tax credit can be claimed if the invoice is in the government's name, concerns are raised about bypassing standard government procurement processes and GFR rules. It's suggested that for amounts over Rs 25,000, a tendering process might typically be required, though exceptions or deviations might be permissible with proper justification and competitive pricing statements from the consultant.

03 March 2022 Hello,

Wanted to know if we, as a government organization, can reimburse the amount (> Rs 25,000) spent by our Project Management Consultant (as private entity technical consulting vendor) on the purchase of equipment including Desktops, Laptops, Networking equipment, (or any other Fixed asset) for their work assigned by our Government office ?

03 March 2022 Yes, pay through cheque or bank transfer.
For GST ITC claim invoice should be in the name of the government organisation with GST number.

03 March 2022 Thanks for your response CA R Seetharaman!
But the main issue i would see in this case is the Government procurement process being bye-passed (and GFR not being followed) then?
Any procurement for >Rs 25,000 (by a Govt. Organisation) follows bidding/tendering system. But in this case, reimbursement to the consultants (procuring on the Govt. Organisation’s behalf) involves payment for procurement of equipment for the Govt. Organization?

03 March 2022 For 25000 procurement tendering process may be waived. Check the rules and obtain statement from consultant that he purchased at competitive prices.

03 March 2022 Yes Right!
But for any procurement above Rs 25,000, shouldn't we follow the appropriate GFR / Procurement Policies of the Government. Don't you think the process is getting bypassed here?

03 March 2022 And.. most importantly, if the said reimbursement (expenses) creates Fixed Asset(s) for the given Govt. Organization ?

03 March 2022 Approval for deviation can be obtained as this is a consultant procurement for his work.


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