No. 2022/RS(G)/779/7(3390005) Dated: 17.10.

2022

The General Managers, All Indian Railways/PUs, NF(C), CORE

DG, RDSO/Lucknow, NAIR/Vadodara
PCAO, PLW/Patiala, COFMOW
CAO, WPO/Patna, RWP/ Bela

Sub: Handling of Warranty Rejections

Ref: Railway Board’s letter No.2000/RS(G)/379/2 dated 07.08.2015 and 18.01.2018.

Background
Consolidated instructions on handling of warranty rejections were issued vide Railway Board’s
letter no.2000/RS(G)/379/2 dated 07.08.2015 and 18-01-2018. These instructions primarily
stipulate linking of warranty rejections to the concerned supplying stores depot and relevant
purchase orders by the user and arrange for warranty replacements duly conducting joint
inspections with pre-inspection agency and the firm.
Review of Warranty Management system indicated practical difficulties in efficient handling of
several of warranty issues, centralized database, monitoring of warranty settlement, resultant
deterrent actions and system improvements. The system of handling warranty rejections is largely
manual and whatever computerization is there, it is on separate systems which are not fully
equipped to handle warranty rejections end-to-end, and are not integrated. Also, the policy did not
cater for many scenarios which are encountered while dealing with the warranty rejections e.g.
warranty rejections of components of Rolling Stocks supplied by Private/Govt/Railway units, cases
where PO/stores depot/User depot is not linked, epidemic failures, inefficient marking on the items
for linking of items to vendor/purchase orders, warranty claims by users, communication of
warranty period to end user ertc
Under this background, the consolidated policy instructions on warranty rejection handling
including an Online Integrated Warranty Management System over IR, covering entire warranty
management landscape to include all types of warranty failures, including epidemic failures,
keeping in view practical field conditions for implementation are being issued in this circular. This
circular supersedes earlier circulars on the subject.

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1. Digitisation of Warranty Management System
i. The entire Warranty Management System shall be digitized and made paperless.
ii. The existing maintenance Applications viz CMM, FMM, WISE, SLAM, PUs local system, etc.
shall be integrated with UDM/ IMMS/IREPS for seamless transfer of required data. A
provision shall be made on these platforms to facilitate end uses to register warranty
complaints. Duplicate feeding on UDM is to be avoided. All systems dealing with warranty
rejection of vendor and their response should have provision of uploading/attaching
documents.
iii. Provision shall be made on IREPS for the vendors to input dispatch details such as batch
number, serial number, major sub component of the item, date of manufacturing (in
MM/YYYY), expiry date (wherever applicable), manufacturer’s marking, make/Brand, etc.
against the Purchase Orders for each consignee. These details would be passed to
iMMS/UDM and reflected in DRR/R-Note/CRN generated on iMMS/UDM and for indicating
the same while issuing the materials through Issue Notes. Inspecting Agencies shall also
indicate these details explicitly in the Inspection Certificate. End Consignee receiving the
material from the vendor will verify these details at the time of receipt of material and
explicitly indicate the same in iMMS/UDM.
iv. Warranty period shall be captured in digital form as stated in Para 4 of this letter.
v. Centralized Recovery Register shall be digitized & maintained in IPAS and linked with
iMMS/UDM for seamless both-ways data flow between these applications for recovery.
vi. The Warranty Rejections of vendors and their responses shall be linked with Unified Vendor
Approval Module (UVAM). Cognizance of these warranty rejections of vendors shall be
taken for reviewing the Approval of vendors by vendor approving authorities.
vii. Cognizance of these warranty rejections of vendors shall be taken by the procuring
authorities in deciding the tender cases.

2. Materials are rejected under warranty in the following situations:

(A) Material rejected was issued to the user (shop/shed etc) from its attached Stores Depot or
attached User Depot (both Stock & Non-stock).
(B) Material rejected was received from a PU or a Stores Depot or a User Depot which is not
the attached depot of the end user including that received directly through centralized
procurement (both Stock & Non-stock).
(C) Material was rejected in the field and was fitted at some other Workshop/Shed/Depot.
Material either received or fitted through Supply Contract, Works Contract or Service
Contract or any other type of contracts (both Stock & Non-stock).
(D) Failure of components of Rolling Stocks received from Railway PUs/ PSUs/ Workshops/
Private Manufacturers

The Methodology of handling these rejections are dealt with below:

(A) For Warranty rejection in Shop/Shed etc where rejected material was issued from its attached
Stores Depot or attached User Depot (both Stock and Non-stock items)-
i. In case the material was accounted for in Stores Depot in iMMS after receipt from vendor, end-
user shall register the warranty complaints with reasons and other details, as required, on the

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 systems like CMM/FMM/WISE/SLAM/MU etc. available with them & electronically transfer such
data to UDM through integrated system or shall register the warranty complaints directly in UDM
(as convenient and practical for the end- user) and issue “Advice Note” of returned stores on UDM
with the approval of competent authority (Gazetted Officer) to return the rejected material to
attached Stores Depot for issuing “Warranty Rejection Advice” (i.e. warranty claims lodging) by
attached Stores Depot.
However, in case the material was accounted for in User Depot in UDM after receipt from the
vendor, there is no need for issuing “Advice Note” & to return the rejected material to attached
Stores Depot.
“Warranty Rejection Advice” (i.e. warranty claims lodging) shall be issued to the firm with the
approval of gazetted officer of the end consignee of attached Stores Depot/ User Depot
(depending upon where rejected material was accounted for after receipt from vendor) on
iMMS/UDM after getting the warranty rejected material from end-user.
Before, issuing the “Warranty Rejection Advice”, the concerned user of iMMS/UDM & gazetted
officer shall satisfy himself about the availability of the rejected material, correctness
of PO (Purchase Order) and applicability of warranty period and ensure that other
details including reason(s) for warranty rejection are genuine as per specification,
drawing and terms and conditions of the Contract. This should be decided within 15
days.
ii. Rejected material shall be taken out from the ledger of Stock-Holder in iMMS/UDM (as the case
may be). The “Warranty Rejection Advice” shall be issued on iMMS/UDM by attached Stores
Depot/ User Depot to all concerned i.e. firm, purchaser, pre-inspecting agency, vendor approving
agency, paying authority etc. as per the contract- without fail.
iii. In the Warranty Rejection Advice, the vendor shall be called upon for replacement of rejected
stores or for deposition of equivalent amount of rejected material, within a period of 60 days from
the date of Warranty Rejection Advice. Date of issue of Warranty Rejection Advice by gazetted
officer to be taken as date of Warranty Rejection Advice.
iv. It shall be ensured that initiation of warranty complaint by user and issue of Warranty Rejection
Advice in UDM/iMMS is not delayed by concerned officials/officers and warranty rejection advice
should be issued within 15 days of detection of warranty complaint. However, if the warranty
complaint is detected within warranty period, the “Warranty Rejection Advice” must be issued
within warranty period.
On issue of “Warranty Rejection Advice”, the “Warranty Rejection Register” should automatically
get updated.
v. On getting the “Warranty Rejection Advice”, the inspecting agency shall take suitable action
against the inspecting officials and ensure necessary corrective actions; duly informing the Officer
who has approved the “Warranty Rejection Advice”. Recovery of inspection charges from the
concerned inspecting agency for the rejected item(s) shall be made by any Bill Paying Authority
across IR on pro-rata basis for the quantity and as per the rate of inspection charges for the
inspection agency. Claim for recovery of inspection charges against the concerned 3rd party
inspecting agency (like RITES etc.) shall automatically get noted into “Centralized Recovery
Register” maintained in IPAS on the basis of “Warranty Rejection Advice”; which shall specifically
mention the name of inspecting agency. After recovery of inspection charges by any Bill Paying

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 Authority, “Centralized Recovery Register” w.r.t. recovery of inspection charges to be
automatically updated in IPAS to that extent so as to avoid multiple recoveries of inspection
charges by different Railways and communicate the recovered amount to iMMS/ UDM.
vi. Any Bill Paying Authority across IR shall withhold the payment of equivalent amount of rejected
material through “Centralized Recovery Register” from firm’s Bill(s) at the earliest, till the full
amount is withheld and the same shall be released only after disposal/closure/settlement of the
warranty claim or deposition of equivalent amount of rejected material or after recovery, whichever
is earlier. After withholding of amount by any Bill Paying Authority, “Centralized Recovery
Register” to be automatically updated in IPAS to that extent so as to avoid multiple withholdings
by different Railways and communicate the withheld amount to iMMS/ UDM.
vii. Firm shall be allowed to collect the rejected materials only after deposition
of payments already made by Railway (if any) to them or after recovery of equivalent amount by
Accounts or against replacement quantity. Rejected material should be suitably defaced before
handing-over to the firm to avoid re-use and necessary provision about digital capturing in
respective modules may be done.
viii. Warranty Quantity Replacement-
a. Replacement of rejected quantity shall be made to the end consignee at the Stores Depot/User
Depot which received the original supply from the firm.
b. The warranty quantity replacement will be supplied and accounted for in iMMS through
R/Note & RO if “Warranty Rejection Advice” has been issued through iMMS. However, where
“Warranty Rejection Advice” has been issued through UDM, the warranty quantity
replacement will be supplied and accounted for in UDM through CRN. R-Note/CRN
should be clearly marked as “Warranty Replacement CRN/R-Note, Not for Payment”.
ix. Replaced/rectified material shall have warranty for the replaced/rectified goods till the original
warranty period plus the time from the warranty rejection advice to material
replacement/rectification.
x. Vendor would be permitted to lift the rejected material (subject to clause 2(A)(vii) above) “free of
cost” within the period mentioned in Para 2(A)(iii) above. After this time, ground rent shall be
applicable.
In cases where firm fails to lift the rejected material within the time period mentioned in para 3203
of IRS Condition of Contract, at the expiry of the period, no claim whatsoever shall lie against the
Purchaser in respect of the said goods, which may be disposed of by the Purchaser in such
manner as he thinks fit. Without prejudice to the generality of the foregoing, all the provisions in the
Indian Railways Standard Conditions of Contract relating to the 'rejection of goods' and 'failure' and
'termination' add and Clause 3100-02 shall apply.
xi. In case disposal/closure/settlement of the Warranty Rejection Advice is not done by firm within
the period of 60 days, Recovery Advice of equivalent amount of rejected material for which
Warranty Claim has not been disposed/closed/settled shall be automatically sent from iMMS/UDM
(depending upon from where Warranty Rejection Advice has been issued) to IPAS and the
“Centralized Recovery Register” of IPAS shall be automatically updated for recovery. If any
amount is already withheld against the “Warranty Rejection Advice”, the same shall be treated as
recovered amount and adjusted accordingly. For balance amount, any Bill Paying Authority
across IR shall recover the amount mentioned in “Centralized Recovery Register” from firm’s

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 Bill(s), if any. Paying Authorities should not delay the recovery and ensure recovery expeditiously.
Even if the payable amount against a Bill and withheld amount are not enough for the full
recovery against a Warranty Claim, the Paying Authority should proceed with partial recovery to
the extent of payable amount against that Bill and balance recovery amount will remain in the
“Centralized Recovery Register” for further recoveries from other Bill(s).
After recovery, the “Centralized Recovery Register” should be automatically updated immediately
to avoid multiple recoveries by different Railways and communicate the recovered amount to
IMMS/ UDM.
xii. Generally, no rejected quantity replacement/rectification should be allowed once recovery has
been made by Accounts or the recovery amount has been deposited by vendor. While receiving
fresh replacement supplies/allowing Re-inspection/Rectification/Amount deposition by vendor
against Warranty Rejection Advice after the period of 60 days, user in IMMS/UDM must ensure
that these activities are allowed only to the extant the Claim amount has not been recovered by
Railways. Once recovery of the warranty claim amount is made in IPAS/deposition by the firm,
user will not be allowed to initiate process of receipt of fresh replacement supplies / Re-
inspection / Rectification to the extent recovery of the Warranty Claim amount has been completed
in IPAS/deposited by firm against Warranty Rejection Advice.
However, there may be some cases against a Warranty Rejection Advice like:
a. Fresh replacement supplies have been received before recovery but material taken into
Ledger by user after recovery
b. Re-inspection or Rectification allowed before recovery but material taken into Ledger by
user after recovery
c. Amount deposited by vendor before recovery but details of such deposition entered by
user after recovery
d. Warranty Rejection Advice withdrawn altogether after recovery
e. Any other incidence like Court /Arbitration Judgement/Order etc. after recovery
In such cases, in all fairness; equivalent amount recovered has to be refunded to the vendor In
case of (a) to (e) above, recovered inspection charges shall also be refunded to the inspection
agency.
For such cases, the officer approving the Warranty Rejection Advice, with the approval of his officer
next in hierarchy (minimum JA grade officer), can issue “Recovery Refund Letter” on iMMS/UDM
on advice of the Stock Holder which shall be visible to all stake-holders including IPAS as well as
vendor. Vendor may submit his Supplementary Bill on the basis of “Recovery Refund Letter” to the
concerned Paying Authority which has deducted the refundable amount on-line or off-line;
depending upon the case whether the Bill against which recovery has been made was submitted
on-line or off-line. IPAS will pass-on information of all such refunds against a “Warranty Rejection
Advice” to iMMS/UDM so that this information can be made available to all stake-holders.
Necessary checks & balances should be provided in IPAS to ensure that vendor is not refunded the
recovered amount more than the actual recovered amount or the amount mentioned in “Recovery
Refund Letter”.

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xiii. Inspection of Replacement Supply- In line with IRS Conditions of Contract clause 0703,
Vendor shall bear all cost of such replacement including freight, cost of inspection and inspection
charges to inspecting agency, if any, on such replacing and replaced stores but without being
entitled to any extra payment on that or any other account.
The replacement supply shall normally be inspected by the same inspection agency
which inspected and passed the original supply. However, inspection clause for replacement of
quantity rejected under warranty can be changed from 3 rd Party Inspection (RITES/RDSO etc.) to
Consignee Inspection with the approval of minimum JA grade level officer of the office issuing
Warranty Rejection Advice, duly considering practicability of the case due to low quantity/value,
criticality of the item, quality issues involved etc.

(B) For Warranty rejection in Shop/Shed etc of the material received from a PU or a Stores Depot
or User Depot which is not the attached Depot of the end user including that received
directly through centralized procurement (both Stock and Non-stock items)-
i. In such cases it may not be convenient for the end user to either return the material or
communicate to the Stores Depot/User Depot (where the accountal of supply received from
vendor was originally made). Thus, in all such cases, the warranty rejected material shall be
kept in safe custody of the end user. End User shall register the warranty complaints with
reasons and other details, as required, on the system like CMM/FMM/WISE/SLAM/MU etc.
available with them and electronically transfer such data to UDM through integrated system or
shall register the warranty rejections directly in UDM (as convenient and practical for the end-
user). “Warranty Rejection Advice” (i.e. warranty claims lodging) shall be issued to the firm with
the approval of gazetted officer of the end user on UDM after linking with PO,
R/Note/CRN/Accountal Details.
Before, issuing the “Warranty Rejection Advice”, the concerned user of UDM & gazetted
officer shall satisfy himself about the availability of the rejected material, correctness
of PO and applicability of warranty period and ensure that other details including
reason(s) of warranty rejection are genuine as per specification, drawing and terms and
conditions of the Contract
ii. The “Warranty Rejection Advice” shall be issued on UDM by End User to all concerned i.e. firm,
purchaser, pre-inspecting agency (if known), vendor approving agency, paying authority etc
without fail.
iii. Warranty Quantity Replacement-
a. Replacement of rejected quantity shall be made at the end of end user.
b. The warranty quantity replacement will be supplied and accounted for in UDM
through CRN. The CRN should be clearly marked as “Warranty Replacement CRN, Not
for Payment”.
iv. Other provision shall be as per sub-Para (iii) to (xiv) of Para 2(A) above, except Para (viii) of 2(A)

(C) For Warranty rejections in the field where material rejected was fitted at some other
Workshop/Shed/Depot- Material either received or fitted through Supply Contract or
Works Contract or Service Contract (both Stock and Non-stock items)-

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 i. In such cases it may not be convenient for the end user to either return the material or
communicate to the Stores Depot/User Depot (where the accountal of supply received from
vendor was originally made) or to the concerned Workshop where items were fitted.
ii. Such case shall also be dealt as per Para 2(B) above.

(D) Warranty rejections of Rolling Stocks received from Railway PUs/PSUs/Workshops/Private

Manufacturers and their components -
i. Rolling Stocks are manufactured by following agencies:
SN Type of Rolling Stocks Manufactured by
1 Wagons Private Manufacturers, Railway PSU, Railway
Workshop
2 Coaches
3 Locomotives Railway PUs/PSUs/Private Manufacturers

4 Train-Sets
5 MEMU, DEMU, EMU etc.

ii. Manufacturing Units of Rolling Stocks should provide the following details of all components/sub-
assemblies used/fitted in that rolling stock to inspecting agency as well as consignee railway/end
user. Inspecting agency, during inspection of Rolling Stock shall ensure digital capture/entry of
this data into the respective digital platform.
a. Rolling Stock Number
b. Name of the Rolling Stock supplier
c. Contract number & Date against which Rolling stock supplied to Railway
d. Contact details of Rolling Stock Supplier
e. Name and address of component manufacturer and/or supplier.
f. Date of manufacture of component (MM/YYYY).
g. Inspecting agency for the component.
h. Inspection details of component
i. Warranty of component in months.
j. Vendor Approving agency of the component.
k. Batch/Product Marking, serial number etc of component.
l. Any further details to facilitate complete identification of the supplier of component by end user
iii. For individual components, all Rolling Stock Manufacturers/Suppliers shall be responsible to honour
the warranty claims on the basis of warranty period of individual components instead of the entire
rolling stock.
iv. The warranty settlement will be processed as per procedure as under

a. Rolling stock is supplied by a private manufacturer or Railway/other PSUs-

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 Warranty claim shall be lodged against Rolling Stock supplier.
This shall be same case as 2(B) above except that in case of items appearing in the
approved vendor list of vendor approving agencies, information about such cases shall also
be shared with vendor approving agencies.
Rolling Stock Supplier shall be the interface between Railway and component supplier. He has
to organize the complete warranty settlement. Any action by the component supplier shall be at
the specific direction and authority of Rolling Stock supplier.

b. Rolling stock supplied by Railway PUs, Workshop-

In all such cases, the warranty rejected material shall be kept in safe custody of the end user.
End User shall register the warranty rejections with reasons of rejection and other details, as
required, on the system like CMM/FMM/WISE/SLAM/MU etc. available with them & transfer
such data to UDM or shall register the warranty rejections directly in UDM (as convenient and
practical for the end- user).
The concerned Railway PU or Workshop shall replace the rejected component within 60 days
from warranty rejection registration date at the end of concerned end User registering the
warranty rejection either as a fresh supply by Railway PU/workshop or get it replaced/rectified
through the component manufacturer/supplier whose supplies have been rejected.
Simultaneously, the Railway PU/Workshop shall raise the warranty claim by issuing “Warranty
Rejection Advice” on UDM on concerned component manufacturer/supplier separately from
their end as per the process detailed in Para 2(B) above.

3. Rectification of the rejected stores-

i. In case the vendor requests for rectification/repair of rejected stores in terms of Para 2,
rectification/repair to be permitted in exceptional circumstances and only if the item can be
effectively rectified/repaired at the user end and with specific prior approval of the officer next
in hierarchy (minimum JA grade officer) to the gazetted officer issuing Warranty Rejection
Advice. At the option of the Depot Officer/ officer of end-user (depending upon who has issued
the “Warranty Rejection Advice”), rectification/repair of rejected stores by the firm shall be
permitted within railway premises only.
ii. If firm requests to rectify/repair the rejected stores at its own premises, same shall be allowed
only if the item has unique traceability to ensure that the rejected item cannot be supplied to
any other consignee/user and if supplied, it can be traced. For taking out the rejected quantity
for rectification/repair, equivalent value of rejected item shall be deposited by the firm.
iii. However, the rectification activity shall have to be completed within timelines given in sub-
Para iii of case 2(A) from the date of issue of “Warranty Rejection Advice.” After this, process
for recovery shall be initiated.

4. Linking the rejected stores with PO, R/note, warranty period etc –

i. Marking of stores has been mandated as per Clauses 1103, 1302, and 2704 of IRS
Condition of Contract, which must be ensured.

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 ii. Specification/drawing of the item should include conditions for marking of the item for
establishing unique traceability of the item, accountability and performance monitoring of
the item/supplier. Marking should be with manufacturer’s name, lot/batch number, serial
number, month and year of manufacture (in MM/YY format). If possible, Railways’
purchase order number and date, consignee code, suppliers’ IREPS vendor code and
warranty period in number of months may also be included to have complete traceability.
Drawing/specification must specifically indicate the types of acceptable marking
mechanism/method. Marking method selection should be based on factors like item
function, item geometry, type of surface, item size, operating environment, age/ life,
criticality, cost, etc. Marking method prescribed in the drawing/specification should be good
enough to ensure that unique traceability is possible for the lifecycle of the product and if
not possible, at least up to the warranty period of the item.
iii. Direct Part Marking (DPM) for items shall be done based upon the criticality/cost/feasibility
to have DPM of the item. The criticality/cost/feasibility shall be decided by the concerned
Railway Board Directorates depending upon the nature of the item or/and its end use. This
scheme will help in pin-pointing the responsibility, shall improve traceability, accountability
and performance monitoring of the item and that of the supplier. Part Marking should be
part of specification and should at least indicate manufacturer’s name, lot/batch/item No.,
month, and year of manufacture in MM/YY format. If possible, Purchase Order number and
date, consignee code, IREPS vendor code and warranty period in number of months may
also be included. It shall be responsibility of the firm to develop a unique coding
scheme/mechanism for ensuring traceability of its product. The firm shall intimate the same
to the purchaser at the time of supply. In case it is not possible to have these details as
part marking on the item, alternate marking scheme and its implementation may be
decided by the concerned Directorates.
iv. Onus of marking and traceability as per purchase order shall be on vendor
v. The record of fitment of item shall be captured digitally on UDM and/or other applications /
Maintenance Modules like CMM/FMM/SLAM/WISE/MU etc.
vi. Capturing Warranty Period digitally in unambiguous terms:
a. In terms of RB letter No. 78/RS(G)/777/1 dated 07/05/2004:
(i) Warranty Clause specified in the tenders should normally be same as that in
IRS conditions of contract.
(ii) Wherever it is considered necessary to have Warranty Clause in technical
specifications at variance with Warranty Clause in IRS conditions of contract,
then technical department, while submitting the indents, and while providing
the specifications, will advise clearly about applicable Warranty Clause for
procurement to avoid problems at post contract stage.
(iii) While procuring the material, it should be ensured that the applicable
Warranty Clause is specified in tender documents clearly and in
unambiguous terms.
b. Warranty clause if at variance with IRS conditions of contract shall be a specific clause
in the tender/PO and shall supersede warranty clause of IRS conditions of contract.

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 Else it should be mentioned in tender conditions that warranty as per IRS conditions of
contract is applicable. Both should never be included in the tender.
c. A field of Warranty period for the item under procurement may also be indicated on
IREPS while floating tender for the same
d. Data of warranty period should be captured in digital form in terms of number of
months and should get reflected in tender, contract, Inspection Certificate and R/Note
in digital form and should be known to the end-user.
e. During inspection/receipt of the item, inspecting Agency and material accepting
authority shall ensure marking as per purchase order.

vii. While issuing the stores, “Issue Note” should be linked with warranty period in months, RO
number, PO number/date and Depot Code as well, so that supply details and exact
warranty period is known to consignee/end user.
viii. IMMS and UDM systems should be able to provide the complete supply details i.e. PO No./
Date, Vendor Name, Challan No./Date, warranty period etc. for the consignment to be
rejected.
ix. Online provision shall be made for entering the complete details of item as per Para 1 (iii)
above by the vendor at the time of dispatch and that should be captured on iMMS/UDM
while accepting the material.

5. All efforts should be made to link the warranty rejected item with P.O. However, if it is not
possible to link the PO, warranty period mentioned in drawing/specification shall be taken into
consideration or if not mentioned therein, it shall be as per IRS conditions of Contract. In such
cases the warranty period shall be applicable from the end of month next to manufacturing
month mentioned on material (assuming that stores are supplied after inspection after 30/45
days from the actual date of manufacture).

5.1 The Warranty settlement in such cases shall be as per para 2(B) above, except following-

a. As PO details shall not be available, details of PO, R Note, CRN etc may not be included
in Warranty Rejection Advice and other communications.
b. The value of rejected materials shall be decided on the basis of rate of component as per
latest PO available.
c. If Inspecting Agency of the rejected store is not known, warranty rejection advice shall
not be sent to inspecting agency and para 2(A)(v) shall not be applicable.
d. If Inspecting Agency of the rejected store is not known, the inspecting agency for the
replacement supplies shall generally be as per the inspection policy followed for normal
procurement or as per Para 2 (A-xiii) above.
6. Authority to adjudicate the disputed warranty cases and authority to decide appeal-
i. For all warranty rejection cases, the controlling officer of minimum JAG level of the office
issuing ‘Warranty Rejection Advice” shall be adjudicating the disputed cases. His decision
shall be binding on all the parties.

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 ii. All the disputes, legal matters, etc. arising out of warranty claim shall be handled directly by
the office issuing the “Warranty Rejection Advice”.

7. Handling Epidemic Failures-

Any recurring/large scale rejections from a particular lot will lead to epidemic failure.

i. Whenever the quantity rejected anytime during the warranty period exceeds 5% of the total
supplied lot against a particular contract, it will be considered as Epidemic Failure.
However, in case of failures related to items which are extremely critical from safety
consideration (like critical components or sub-parts of air brake system, wheel discs, axles,
propulsion system etc.), RDSO/PU may pre-define a lower percentage for considering the
occurrence of epidemic failure. This condition should be declared in the tender document
for procurement of such items.
ii. Same steps as mentioned at para 2, as applicable, to be followed. However, instead of
rejecting only defected quantity, entire lot should be rejected. Even if some quantity of such
lot has been used/fitted, the same may also be identified and called back from service, to
the extent possible, by the concerned technical department for issuing warranty rejection.
iii. Joint Inspection shall be conducted as per extant provisions.
iv. In case warranty rejection is established in joint inspection, the vendor shall replace entire
lot (as available, refer point ii above) duly inspected by inspecting agency as per contract
on his own expenses.
v. Replacement supply should be inspected by the same agency which has previously
inspected the supplies.
vi. Epidemic failure is essentially considered as very poor quality performance and should be
reflected on the performance of vendor/Inspecting agency accordingly.
vii. Concerned Inspection /Quality monitoring/Vendor approving agencies should conduct root
cause/failure analysis of the failure and QAP of vendor shall have to be re-validated. They
should also suggest improvement in inspection methodology/Quality Assurance Plan to
avoid failures.
8. In case the vendor disputes the Warranty Rejection as per Warranty Rejection Advice,
representation from vendor should be sent through IREPS system to the officer issuing
Warranty Rejection Advice within 7 days from the issue of Warranty Rejection Advice. In such
case a joint inspection shall be organised by the officer issuing Warranty Rejection Advice for
the grounds of warranty rejections mentioned in the Warranty Rejection Advice.
9. In all cases of warranty rejections where items are appearing in the approved vendor list of
vendor approving agencies, information about such cases shall also be shared with vendor
approving agency as per Para 1 (vi) above for performance monitoring and
capability/capacity assessment/delisting/down gradation of the vendor and review of the
design/specifications/STR if required. If required, based on merit of the case, Vendor
approving agencies may take appropriate decision on suspension of inspection

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 10. Data of the warranty rejections shall be analysed item-wise and vendor-wise by the Quality
monitoring/vendor approving agency to identify the areas for improvements in systems,
processes and design/specification.
11. The recovered amount from the vendor should be credited in the same allocation of the end
use in which the item was originally procured.
12. Since complete process is being considered for digitisation, procurements (including Railway
Board procurements) which are not being done through iMMS, should also be done through
iMMS and Contracts issued through iMMS.

NOTE:
For ease of understanding, a sample flow chart for case 2(A) is enclosed. Other cases (Case 2(B)
to 2(D)) involve only minor modifications of the same. In case of any difference between this
circular paras and flow chart, the circular para shall prevail.
CHANDAN KUMAR
2022.10.17 17:17:51 +05'30'
(Chandan Kumar)
Director Railway Stores/IC
Railway Board
LIST FOR DISTRIBUTION
Directors of all CTIs,
CMDs /MDs of all Railway PSUs/ autonomous bodies/ societies
PFAs, PCMMs, PCEs, PCMEs, PCEEs, PCSTEs, All Indian Railways & PUs, COFMOW, CORE,
WPO/Patna and RWP/Bela
Sr. Prof. (Material Management), NAIR, Vadodara, ED (Stores), RDSO, Lucknow
Chief Commissioner, Railway Safety, Lucknow
Zonal Railway Training Institute, Sukadia Circle, Udaipur
Copy to:
The Genl. Secy., AIRF, Room No. 248, & NFIR Room No. 256-C, Rail Bhavan
The Secy. Genl., IRPOF, Room No. 268, FROA, Room No. 256-D & AIRPOA, Room No. 256-D, Rail
Bhavan.
Copy to:
PSOs/Sr. PPSs / PPSs / PSs to:
MR, MOSR(D), MOSR(J)
CRB&CEO, M(TRS), M(Infra), M(O&BD), M(F), Secretary/RB, DG (RHS), DG (RPF), DG(HR),
DG(Safety)

Advisor/MR, EDPG/MR, OSD/MR and OSD/Coord/MR

All AMs, PEDs & Executive Directors of Railway Board.

Room No. 363, Rail Bhawan, Raisina Road, New Delhi-110001

E3390005

Page 12 of 12
 Flowchart for the processes (Case 2(A) of the circular) involved in Warranty policy: For Warranty rejection in Shop/Shed etc where rejected material
was issued from its attachedStores Depot or attached User Depot (both Stock and Non-stock items)-
(OTHER CASES INVOLVE ONLY MINOR MODIFICATIONS)

Start A

End-user shall to raise the warranty rejection with withhold the payment of equivalent amount
reasons of rejection and other details, as required, of rejected material through ?Centralized
on the system like CMM/FMM/WISE/SLAM/MU etc. Recovery Register? from firm?s Bill(s) till the
available with them or shall raise the warranty Inspection of full amount is withheld, Update Centralised
rejections directly in UDM Replacement Recovery Register
Supply

No Advise Yes
note issued for Approval by
No
returned Gazetted Officer
Stores Close Warranty Has the firm replaced the material or
Rejection Advise, deposited equivalent amount of rejected
Yes material, within a period of 60 days from the
Update Centralised
signing of Warranty Rejection Advice by
Recovery Register
Advice Note of returned Gazetted Officer?
by releasing
Stores to attached stores
Withold amount
Depot

No
Return Rejected Material
to Attached Stores Depot
Recovery Advice of equivalent amount of rejected
material for which Warranty Claim has not been
disposed/closed/settled shall be automatically sent
from iMMS/UDM

gazetted officer satisfied about the availability

No Warranty of the rejected material, correctness of PO (Purchase Order)
Rejection No and applicability of warranty period and reason(s) ofwarranty rejection are
Advise Issued genuine as per specification, drawing, terms and conditions of
contract?
?Centralized Recovery Register? of IPAS shall be
automatically updated for recovery. If any amount is
already withheld against the ?Warranty Rejection
Advice?, the same shall be treated as recovered amount
and adjusted
Yes

Warranty Rejection
Advice issued by Stores
Depot/User Depot on
iMMS/UDM
Recovery against Warranty Claim till full
amount recovered

Rejected material shall be

taken out from the ledger of
Stock-Holder in iMMS/UDM

a. Has Fresh
replacement supplies
Warranty Rejection Advice? shall be issued on iMMS/UDM by attached Stores Depot/ User been received before recovery
Depot to all concerned i.e. firm, purchaser, pre-inspecting agency, vendor approving but material taken into Ledger by
agency, paying authority etc. as per the contract user after recovery
b.Re-inspection or Rectification allowed
before recovery but material taken into Ledger
by user after recovery
c.Amount deposited by vendor before recovery but
details of such deposition entered by user after
Warranty Rejection register Updated recovery
Yes (a to e) d.Warranty Rejection Advice withdrawn
altogether after recovery
e.Any other incidence like Court
/Arbitration
Action against Inspecting Official and corrective Action, Judgement/Order etc.
after recovery
Issue of
Recovery
refund letter
Claim for recovery of inspection charges against the concerned
3rdparty inspecting agency shall automatically get noted into
?Centralized Recovery Register? maintained in IPAS on the basis
of ?Warranty Rejection Advice?;
Vendor to
submit
supplementary
bill
Recovery of Inspection Charges on
pro-rata Basis from Inspecting Agency

Refund
Closure of details from
Warranty IPAS
A advice updated on
IMMS/UDM
No