Content

10.1 Introduction

Detailed guidelines and processes have been prescribed in the foregoing chapters for various aspects of project implementation under DDU-GKY. This chapter describes the actions to be taken and procedures to be followed, if there is any deviation from the prescribed norms, and for imposition of penalty in cases where a default occurs.

An overview of what constitutes a default and the procedures for handling defaults is provided in “SF 10.1A: Overview of Default Handling Procedures”, while the table in “SF 10.1B: Competent authority for handling default procedures” describes the competent authority to deal with different stages of the default handling procedures, including imposition of penalties.

10.2 Issues, Escalation and Closure of Alerts

10.2.1 Yellow (Level 1) Alert

Overview

Item	Description
Purpose	To alert a PIA regarding occurrence of default(s) To provide an opportunity to the PIA to address the default(s)
Reference to guidelines	Not applicable
Prerequisite/s	Occurrence of default
Time for completion	As per the activity table
Resources	SF 10.2A: Monthly Statement of Alerts SF 10.2B: Yellow (Level 1) Alert SF 10.2C: Response to Yellow (Level 1) Alert
Process owners	CTSA for YPS SRLM for APS

 

 

Activities

Step no.	Actor	Action	Time for completion[1]	Relevant documents
1.	SRLM for APS and CTSA for YPS	Issue Yellow Alert	8th of the month for the previous month	SF 10.2A: Monthly Statement of Alerts SF 10.2B: Yellow (Level 1)  Alert
2.	PIA	Address the default and complete the relevant task Inform the Alert issuing authority of action taken	18th of the month in which Yellow Alert is received	SF 10.2C: Response to Yellow (Level 1)  Alert
3.	SRLM for APS and CTSA for YPS	Verify that corrective action is satisfactory If so, no further action is necessary  OR  Action as per 10.2.2	28th of the month in which response to Yellow Alert is received or supposed to be received

10.2.2 Red (Level 2) Alert

Overview

Item	Description
Purpose	To alert a PIA regarding occurrence or continuance of default(s) To provide an opportunity to the PIA to address the default(s)
Reference to guidelines	Not applicable
Prerequisite/s	No action/ incomplete action in response to Yellow Alert OR Default is such that issue of Red Alert directly is warranted as per SRLM/CTSA
Time for completion	As per the activity table
Resources	SF 10.2A: Monthly Statement of Alerts SF 10.2D: Red (Level 2) Alert SF 10.2E: Response to Red (Level 2) Alert SF 10.2F: Closure of Red (Level 2) Alert
Process owners	CTSA for YPS SRLM for APS

 

Activities

Step no.	Actor	Action	Time for completion[2]	Relevant documents
1.	SRLM for APS and CTSA for YPS	Issue Red Alert ·         if there is no response to Yellow Alert          or ·         if corrective action in response to Yellow Alert is not satisfactory      or ·         default is such that issue of Red Alert directly is warranted	8th of the month for the previous month	SF 10.2A: Monthly Statement of Alerts SF 10.2D: Red (Level 2) Alert
2.	PIA	Address the default and complete the relevant task Inform the Alert issuing authority of action taken and provide explanation for occurrence of default	18th of the month in which Red Alert is received	SF 10.2E: Response to Red (Level 2) Alert
3.	SRLM for APS and CTSA for YPS	Examine PIA’s explanation and corrective action If they are satisfactory, send closure notice to PIA  OR  Action as per 10.2.3 or 10.3	28th of the month in which response to Red Alert is received or supposed to be received	SF 10.2F: Closure of Red (Level 2) Alert

10.2.3 Escalation to Penalty Process (for YPS only)

Overview

Item	Description
Purpose	To make a recommendation to MoRD for initiation of penalty proceedings against a defaulting PIA To inform the PIA of CTSA’s recommendation to MoRD
Reference to guidelines	Not applicable
Prerequisite/s	Non-satisfactory or no explanation and/or no action/ incomplete action in response to Red Alert OR Decision by CTSA that penalty proceedings should be initiated
Time for completion	As per the activity table
Resources	SF 10.2G: Recommendation for Initiation of Penalty Proceedings SF 10.2H: Penalty Recommendation Intimation SF 10.2I: Action on Penalty Initiation Recommendation
Process owner	CTSA

 

Activities

Step no.	Actor	Action	Time for completion[3]	Relevant documents
1.	CTSA	Recommend to MoRD that penalty proceedings be initiated against a PIA  ·         If there is no action in response to Red Alert    or ·         If corrective action and explanation in response to Red alert are not accepted          or ·         If CTSA decides that penalty proceedings should be initiated against the PIA at any point (whether an Alert has been issued or not) Inform the PIA about the Penalty Recommendation to MoRD	28th of the month in which response to Red Alert is received or supposed to be received	SF 10.2G: Recommendation for Initiation of Penalty Proceedings    SF 10.2H: Penalty Recommendation Intimation
2.	MoRD	Decide whether penalty proceedings should be initiated against the PIA Inform the PIA in case no penalty proceedings are to be initiated or if decision is deferred OR Action as per 10.3	Within 30 days of receipt of CTSA’s recommendation (if there is delay, then intimate the status of the case at least once in 30 days)	SF 10.2I: Action on Penalty Initiation Recommendation

 

10.1.1 Yellow (Level 1) Alert

Overview

Item	Description
Purpose	To alert a PIA regarding occurrence of default(s) To provide an opportunity to the PIA to address the default(s)
Reference to guidelines	Not applicable
Prerequisite/s	Occurrence of default
Time for completion	As per the activity table
Resources	SF 10.2A: Monthly Statement of Alerts SF 10.2B: Yellow (Level 1) Alert SF 10.2C: Response to Yellow (Level 1) Alert
Process owners	CTSA for YPS SRLM for APS

  

Activities

Step no.	Actor	Action	Time for completion[1]	Relevant documents
1.	SRLM for APS and CTSA for YPS	Issue Yellow Alert	8th of the month for the previous month	SF 10.2A: Monthly Statement of Alerts SF 10.2B: Yellow (Level 1)  Alert
2.	PIA	Address the default and complete the relevant task  Inform the Alert issuing authority of action taken	18th of the month in which Yellow Alert is received	SF 10.2C: Response to Yellow (Level 1)  Alert
3.	SRLM for APS and CTSA for YPS	Verify that corrective action is satisfactory If so, no further action is necessary  OR  Action as per 10.2.2	28th of the month in which response to Yellow Alert is received or supposed to be received

10.1.2 Red (Level 2) Alert

Overview

Item	Description
Purpose	To alert a PIA regarding occurrence or continuance of default(s) To provide an opportunity to the PIA to address the default(s)
Reference to guidelines	Not applicable
Prerequisite/s	No action/ incomplete action in response to Yellow Alert OR Default is such that issue of Red Alert directly is warranted as per SRLM/CTSA
Time for completion	As per the activity table
Resources	SF 10.2A: Monthly Statement of Alerts SF 10.2D: Red (Level 2) Alert SF 10.2E: Response to Red (Level 2) Alert SF 10.2F: Closure of Red (Level 2) Alert
Process owners	CTSA for YPS SRLM for APS

 

Activities

Step no.	Actor	Action	Time for completion[2]	Relevant documents
1.	SRLM for APS and CTSA for YPS	Issue Red Alert ·         if there is no response to Yellow Alert          or ·         if corrective action in response to Yellow Alert is not satisfactory      or ·         default is such that issue of Red Alert directly is warranted	8th of the month for the previous month	SF 10.2A: Monthly Statement of Alerts   SF 10.2D: Red (Level 2) Alert
2.	PIA	Address the default and complete the relevant task   Inform the Alert issuing authority of action taken and provide explanation for occurrence of default	18th of the month in which Red Alert is received	SF 10.2E: Response to Red (Level 2) Alert
3.	SRLM for APS and CTSA for YPS	Examine PIA’s explanation and corrective action If they are satisfactory, send closure notice to PIA  OR  Action as per 10.2.3 or 10.3	28th of the month in which response to Red Alert is received or supposed to be received	SF 10.2F: Closure of Red (Level 2) Alert

10.1.3 Escalation to Penalty Process (for YPS only)

Overview

Item	Description
Purpose	To make a recommendation to MoRD for initiation of penalty proceedings against a defaulting PIA To inform the PIA of CTSA’s recommendation to MoRD
Reference to guidelines	Not applicable
Prerequisite/s	Non-satisfactory or no explanation and/or no action/ incomplete action in response to Red Alert OR Decision by CTSA that penalty proceedings should be initiated
Time for completion	As per the activity table
Resources	SF 10.2G: Recommendation for Initiation of Penalty Proceedings SF 10.2H: Penalty Recommendation Intimation SF 10.2I: Action on Penalty Initiation Recommendation
Process owner	CTSA

 

Activities

Step no.	Actor	Action	Time for completion[3]	Relevant documents
1.	CTSA	Recommend to MoRD that penalty proceedings be initiated against a PIA ·         If there is no action in response to Red Alert    or ·         If corrective action and explanation in response to Red alert are not accepted          or ·         If CTSA decides that penalty proceedings should be initiated against the PIA at any point (whether an Alert has been issued or not) Inform the PIA about the Penalty Recommendation to MoRD	28th of the month in which response to Red Alert is received or supposed to be received	SF 10.2G: Recommendation for Initiation of Penalty Proceedings   SF 10.2H: Penalty Recommendation Intimation
2.	MoRD	Decide whether penalty proceedings should be initiated against the PIA Inform the PIA in case no penalty proceedings are to be initiated or if decision is deferred OR Action as per 10.3	Within 30 days of receipt of CTSA’s recommendation (if there is delay, then intimate the status of the case at least once in 30 days)	SF 10.2I: Action on Penalty Initiation Recommendation

10.3 Penalty Processes

10.3.1 Initiation and Closure of Penalty Proceedings

Overview

Item	Description
Purpose	To delineate the penalty processes, including initiation and conduct of proceedings, imposition of penalty, appeal and closure
Reference to guidelines	Not applicable
Prerequisite/s	Decision to initiate penalty proceedings either on recommendation by CTSA or directly by MoRD/SRLM
Time for completion	As per the activity table
Resources	SF 10.3A: Show Cause Notice SF 10.3B: Response to Show Cause Notice SF 10.3C: Personal Hearing Intimation SF 10.3D: Proceedings of Personal Hearing SF 10.3E: Notice of Imposition of Penalty/ Dropping of Penalty Proceedings SF 10.3F: Request for Closure of Penalty Proceedings SF 10.3G: Notice of Closure of Penalty Proceedings SF 10.3H: Appeal against Penalty SF 10.3I: Decision on Appeal against Penalty
Process owners	MoRD for YPS SRLM for APS

 

Activities

Step no.	Actor	Action	Time for completion	Relevant documents
Initiation of Penalty Proceedings
	MoRD for YPS  and SRLM for APS	Issue Show Cause Notice to PIA	No specific timeline (Issue date is P1)	SF 10.3A: Show Cause Notice
	PIA	Provide written response to Show Cause Notice to MoRD (for YPS) or SRLM (for APS), with copy to CTSA	P1+25 days	SF 10.3B: Response to Show Cause Notice
	MoRD for YPS and SRLM for APS	Consider written response of PIA Decide whether PIA needs to be given an opportunity for personal hearing (compulsory if major penalty is contemplated; otherwise optional) Issue notice to PIA, if personal hearing is required  Inform the PIA if decision is pending	Within 30 days of receipt of response from PIA (if there is delay, then intimate the status of the case at least once in 30 days)	SF 10.3C: Personal Hearing Intimation
	MoRD for YPS and SRLM for APS	Complete the personal hearing proceedings, if initiated Record the personal hearing proceedings and communicate details to the PIA Inform the PIA if decision is pending	Within 30 days of issuing Personal Hearing Intimation (if there is delay, then intimate the status of the case at least once in 30 days)	SF 10.3D: Proceedings of Personal Hearing
Imposition and Implementation of Penalty
	MoRD for YPS and SRLM for APS	Take a decision regarding imposition of penalty and inform the PIA that Penalty proceedings are being dropped   or A minor penalty is being imposed     or A major penalty is being imposed Inform the PIA if the decision is pending	Within 30 days of receipt of  written response from PIA or from date of  personal hearing if such an opportunity is given to the PIA (if there is delay, then intimate the status of the case at least once in 30 days)	SF 10.3E: Notice of Imposition of Penalty / Dropping of Penalty Proceedings
	PIA	If MoRD/SRLM decides to drop the penalty proceedings, then no further action is necessary If penalty is imposed Comply with the penalty order Request for closure of penalty proceedings if the PIA decides not to invoke the appeal process    or Action as per Appeal process	As specified in Notice of Imposition of Penalty	SF 10.3F: Request for Closure of Penalty Proceedings
	CTSA/ MoRD for YPS and SRLM for APS	If penalty has been imposed, verify whether the PIA has complied with the terms of the penalty order and inform MoRD	Within 5 days of the time prescribed for compliance in the Notice of Imposition of Penalty
	MoRD for YPS and SRLM for APS	Close penalty proceedings and inform the PIA	Within 15 days of confirmation of full compliance with Notice of Imposition of Penalty	SF 10.3G: Notice of Closure of Penalty Proceedings
Appeal
	PIA	Appeal against penalty	Within 20 days of receipt of Notice of Imposition of Penalty	SF 10.3H: Appeal against Penalty
	Appellate Authority	Provide an opportunity to the PIA to present its appeal against the penalty imposed, including opportunity for personal hearing if required   Decide whether to Uphold the penalty Modify the penalty Cancel the penalty	Within 30 days of receipt of appeal against penalty if there is no personal hearing or 60 days of receipt of appeal against penalty if opportunity for personal hearing is provided (if there is delay, then intimate the status of the case at least once in 30 days)	SF 10.3C: Personal Hearing Intimation SF 10.3D: Proceedings of Personal Hearing   SF 10.3I: Decision on Appeal against Penalty
	PIA	Comply with the decision of the appellate authority   Request for closure of penalty proceedings	As specified in the order of the appellate authority	SF 10.3F: Request for Closure of Penalty Proceedings
	CTSA/SRLM	Verify whether the PIA has complied with the order of the appellate authority if penalty is upheld or modified Comply with the terms of the order of the appellate authority if penalty is cancelled or modified
	CTSA/SRLM	Inform the PIA that penalty proceedings are closed		SF 10.3G: Notice of Closure of Penalty Proceedings

10.3.2 Suo Motu Imposition of Penalty  

Notwithstanding the process delineated in 10.3.1 above, in exceptional cases (for example, diversion or funds, fraudulent practices, persistent defaults, actions that affect the safety of candidates), the competent authority may decide to impose penalty suo motu on a PIA. In such cases, penalty will be imposed directly on the PIA without issuance of any Alert or Notice. However, the PIA will retain the right to appeal against the penalty, and the appeal process will be followed as described above.

10.3.3 Penalty Orders

An order by the competent authority to impose a penalty (major or minor) on a PIA shall be a speaking order, specifying the details of the penalty imposed, and clearly laying down the reasons for penalty imposition as well as the process of implementation of the penalty.

10.4 Handling Defaults by CTSA (For YPS) / SRLM (For APS)

In cases where there is any delay committed by the CTSA (for YPS) or SRLM (for APS), the following procedure will be followed.

• Notice 1: Notice will be issued by MoRD giving 5 working days to take further action.
• Notice 2: If the first notice is not complied with, a second notice will be issued giving 5 working days to take further action.
• Notice 3: After waiting for twenty working days after issue of first notice if CTSA has not completed the action MoRD will take suitable steps for getting the work done. It will also initiate penal action against the CTSA for YPS. Similarly for APS if state does not respond MORD will regulate the flow of funds based on the project progress. If delays occur frequently APS status of the state will also be reviewed. If the delay continues after twenty days of issue of Notice 1, MoRD may take suitable action for completion of the task. It may also initiate penal action against the CTSA (for YPS) or regulate the flow of funds based on the project progress (for APS). The APS status of the state may also be reviewed if delays occur frequently.

 Note: All such notices will be compiled and will become part of CTSA/SRLM performance evaluation.

 For procedures to deal with defaults other than delays, a separate notification will be issued by MoRD.

10.5 Replacement of Older Procedures and Transition to the new Procedures

10.5.1 Sections to be replaced

From a date to be notified by MoRD the procedures prescribed in this Chapter will come into force. Subsequently the following sections/portions of SOP version 2.0.0 issued on August 3, 2015 will stand repealed:  

• Section 1.5 and 1.6 of Chapter 1
• Section 3.1.1.2 of Chapter 3
• SF 7.1F of Chapter 7 – portion relating to correction of errors found in the 1^st round of desk data verification by SRLM (for APS) and CTSA (for YPS) on the samples checked by the PIA OP team and Q team

10.5.2  Dealing with defaults where action has already been initiated

All defaults that occur after the notification of this Chapter will be dealt with in accordance with the processes described in this Chapter. However, in cases where a default has occurred before the date of this notification the same shall be dealt with, as per earlier procedures.

10.5.3 Nomination of competent authorities by CTSA/ SRLM

The competent authorities for handling defaults at the State level shall be decided by each State within one month of the notification of this Chapter. Failing this, the powers delegated to levels lower than COO/Skills of SRLM will be vested with COO/Skills, and all other powers will remain as per this Chapter. The competent authority from SRLM for handling default procedures for APS should not be below the level of State Project Manager (SPM).

The competent authorities for handling defaults at the CTSA level shall be decided and notified by each CTSA within one month of the notification of this Chapter. Failing this, MoRD will issue a notification on the matter, in consultation with the CTSAs, within two months of the notification of this Chapter.