Approval letter for CEFC at TAGMA

No. 121 10/2014- HE&MTGovernment of India

Ministry of Heavy Industries & Public EnterprisesDepartment of Heavy Industry

Udyog Bhavan, New DelhiII-,Dated 12. November, 2015

To

The Director,TAGMA Centre of Excellence and Training (TCET),A-33, Nand Jyot Industrial Estate,Andheri Kurla Road,Safed Pool,Mumbai - 400 072

Subject: Proposal from Tool and Gauge Manufacturers Association of India (TAGMA) forsetting up of Common Engineering Facilities Centre (CEFC) at Chakan, Pune underthe Scheme on Enhancement of Competitiveness in the Indian Capital Goods Sector -Approval thereof.

Sir,I am directed to refer to the proposal of TAGMA dated 9th December, 2014 seeking

grant- in- aid for setting up of Common Engineering Facilities Centre (CEFC) at Chakan, Puneunder the Department of Heavy Industry's Scheme on "Enhancement of Competitiveness in theIndian Capital Goods Sector" notified on 5.11.2014 and to say that the approval of the competentauthority to the proposal, subject to certain conditions, was conveyed to TAGMA vide thisDepartment's letter No. 121 1/2014- HE&MT dated 22.1.2015. Consequent upon confirmationof TAGMA vide letter dated s" September, 2015 on acquisition ofland by the SPY floatedby TAGMA, namely TAGMA Centre of Excellence and Training (TCET) from MaharashtraIndustrial Development Corporation vide MIDC letter No. MIDCI RO (ROP)! CHK- III LMS-I983 3607 dated 4.8.2015, detailed terms and conditions of grant in aid for the above project asindicated in Annexure I to this letter, are hereby conveyed to you.

2. You are requested to formally intimate your acceptance of provisions laid out in thisapproval letter and express your willingness to be bound by terms and conditions mentioned inthe Annexure - I to this letter. You may note that your acceptance of this letter along with termsand conditions will be legally binding on you.

3. You.will have to sign a MoU with Department of Heavy Industry after your acceptanceof this letter. You are also required to submit bank mandate as required to register you as arecipient under pfms.nic.in, pre-receipt etc. for release of the first instalment of grant.

Yours faithfully

~CD.K. Mukherj ee)

Under Secretary CHE&MT)

, '-.; ,r : I.vI

Annexure -I

Terms and Conditions of approval of the project for setting up Common EngineeringFacilities Centre (CEFC) at Chakan, Pune under the Scheme on Enhancement ofCompetitiveness in the Indian Capital Goods Sector notified by the Department of HeavyIndustry in Part I Section I of the Gazette of India (extraordinary) dated 05-11-2014 (hereinafterreferred to as the CG Scheme) under the component of Common Engineering Facility Centresare indicated below in the succeeding paragraphs.

2 PROJECT SCHEDULE

2.1 The work on setting up of CEFC shall commence from the date of release of the firstinstalment of the fund by the Government of India and shall be completed within one year ofreceipt of the first instalment of the DBI budgetary support.

2.2 Major milestones in terms of resource allocations (expenditure) are listed as under:

Months (M) M1 M2 M3 M4 M5 M6 M7 M8 M9 M10 M11 M12 TotalLand 435.6 -- .- -- -- -- -- -- -- -- -- -- 435.6BuildinQs -- 73.3 73.3 73.3 73.3 73.3 73.3 293.2 -- -- -- -- 733.0Utilities -- -- -- -- -- 30,0 30,0 15,0 ·75.0Machinery -- -- -- -- -- 360,1 663,6 811,7 11,800 268,8 3284.2Vehicle & -- -- -- -- -- -- -- -- -- -- 35,0 35.0BooksContinqencv -- 3.7 3.7 3.7 3.7 21.7 36,8 55,6 60,5 14,9 2,5 21,8 228.6Pre- -- 2,3 2,3 2.3 2,3 13.7 23,2 34,8 38,1 9.4 1,6 13.7 143.7OperativesIDC 0,0 o.s 1,8 2,7 3,6 5,1 8,0 14,2 16,0 16.7 16.7 17.2 102.9Margin -- -- -- -- -- -- -- -- -- -- -- 153.8 153.8Money forweTotal 435,6 80.2 81.1 81.9 82.8 473,9 805.0 1209.5 1324.6 339.9 70.8 206.5 5191.8

(Rs in lakh)

3. OUTPUT

3.1 In case of the Scheme component Common Engineering Facilities Centre, facilities set upfor use by the Industry will be considered as output.

3.2 Physical & Financial Targets:

Year Physical Targets Project Cost• Land• Buildings (Design to Commissioning) Rs. 2040.6 lakh including

2015-16 • Machinery (Pre-Order and Rs,1 023.70 lakh forProcurement) Machinery

• Pre-Operatives '.

• IDC

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• Utilities• Machinery (Procurement & Installation) Rs. 3151.2 lakh including• Vehicle & Books Rs.2260.50 lakh for2016-17 Pre-Operatives .• Machinery• IDC• Working Capital

Rs. 5191.80 lakhTotal Project Cost including RS.3284.20 lakh

for Machinery

3.3 A Project Summary is attached at Appendix' A'. Implementation Schedule of the Projectis attached at Appendix 'B'.

4. MODE OF FINANCING

4.1 The Machinery component of the project cost will be jointly funded by the Departmentof Heavy Industry, Ministry of Heavy Industries & Public Enterprises, Government of India(DHI) and the TAGMA Centre of Excellence and Training (TCET) in the ratio 80:20 withoutviolating any condition of the Scheme / GOl Rules. Total cost of Machinery to be installed isRS.32.84 crore. DHI funding will be limited to Rs.26.27 crore.

4.2 Funds will be released by DHI in the designated Project Account on pro rata basis afterreceiving confirmation of contributions by other funding partners. Release of fund will be subjectto fulfilment of terms and conditions of this approval letter, paragraphs 8 and 12 of the GazetteNotification dated 5.11.2014 and relevant Government order/ General Financial Rules,particularly Rules 206- 212 and 215(3) of GFR.

4.3 DHI Budgetary grant will be released in two instalments, one each in a financial year.Utilization of budgetary grant will be subject to and in compliance of tenus and conditions of theSanction Letter.

4.4 Release of 1st instalment of funds shall be arranged by DHI after signing of an MoU bythe Grantee Organisation and after due confirmation of fulfilment of the commitment by theIndustrial Partners to the Project, as per financial target indicated above. Pre-receipted bills willbe submitted, prior to release of fund.

4.5 In addition to the terms & conditions mentioned in paragraph 4.2 above, release ofsubsequent instalments of funds by DHI will be subject to satisfactory progress of the projectmeasured by Project Schedule and satisfactory utilization ofthe fund already released.

5. FINANCIAL & FUNDING PARAMETERS OF THE PROJECT

5.1 Machinery component of this project is partly funded by DBI under the CG schemethrough grant in aid as indicated in paragraph 4.1 above. The total approved financial outlay ofMachinery component of the project as per approved proposal is Rs.32.8.4 crore (Rupees ThirtyTwo Crore and Eighty Four Lakh only). This is the toted cost of the machinery and equipment to

be installed in the CEFC. The grant - in- aid should be utilized for the purpose of CEFC only.Utilization of the grant- in- aid would result in achievement of the following quantitative andqualitative targets:

Output wise break-up of the total project cost(Rs in lakh)

Year Targets with Expenditure Heads

Land Buildings Utilities Machinery V&B* Pre- IOC* WC' Cent" TotalOps

2015- 435.6 . 439.8 1023.7 46.1 22.1 73.3 2040.616 -- -- --2016- 293.2 75.0 2260.5 35.0 97.6 80.8 153.8 155.3 3151.217

--

Total 435.6 733.0 75.0' 3284.2 35.0 143.7 102.9 153.8 228.6 5191.8

* Note: V&B= Vehicle and Books, WC= Working Capital, Cont. = Contingencies

5.2 Cost of Machinery and Equipment

s. Facility / Unit AmountNo. (Rs. in lakb)l. Design Cell 36.002. Tool Room 42l.203. Heat Treatment Unit 390.504. Tool Trial & Validation Unit and Component Production Unit 1843.605. Quality Analysis, Testing and Calibration Unit 135.106. Skill Development Centre 205.807. Support Equipment 252.00

Total 3284.20Details of machinery and equipment is available at Appendix C

5.3 Unless otherwise specified, funding by the Department of Heavy Industry will be limitedto Machinery component of the Project only and will be governed by the relevant provisions ofGeneral Financial Rules (GFR) read with the DHI Notification dated s" November, 2014 onScheme on Enhancement of Competitiveness in the Indian Capital Goods Sector published in thePart I Section 1 of the Gazette of India Notification (Extraordinary) dated 05-11-2014 bearingno. 71 61 2011- HE&MT ( as amended from time to time) and other Government orders and willbe subject to terms and conditions of this approval letter.

6. ROLE AND RESPONSIBILITIES OF PROJECT IMPLEMENTING ORGANIZATION(PIO) also known as Grantee Organization which in the instant case is TAGMA Centre ofExcellence and Training (TCET), A-33, Nand Jyot Industrial Estate, Andheri Kurla Road,Safed Pool, Mumbai-400072, India.

6.1 The Project Implementing Organization (PIO) shall be responsible for timely delivery ofthe output subj ect to timely receipt of funds from both DHI and others.

6.2 The PIO shall maintain a separate account for the funds released by DBI for execution ofthis project.

6.3 The PIO shall make arrangements for proper operation and maintenance of equipment/knowledge procured under the project. PIO shall acknowledge procurement of equipment underthis project by a "TRUST RECEIPT" which is attached, to this document as Appendix D

6.4 The PIO shall ensure that the funds released are utilized only for the purpose of theProject.

6.5 The PIO shall provide free access to DBI officers (or nominees / representatives) and theApex Committee- Capital Goods Scheme (AC-CG) members and their representatives to allfacilities/ assets and their records relating to the project located at their worksite.

6.6 The PIO shall also be responsible for achieving and regular reporting the progress of theproject to DBI. The PIO shall also submit its Standard Operating Procedure (SOP),Memorandum of Articles of Associations (MoA), proceedings of Governing Council/Board andsuch other documents, which contain information pertinent to the project.

6.7 The PIO shall maintain a register of permanent and semi-permanent assets includingMachinery acquired wholly or mainly out of the grant-in-aid as well as log for use of them. ThePIO should maintain proof of having procured genuine new machinery from the vendor alongwith invoices, payment receipt and market value of the specifically procured machine. TheRegister/ log shall be open to inspection by the Department of Heavy Industry. The utilization ofassets so created shall be in public interest and shall be the responsibility of the PIO.

6.8 The PIO will ensure that assets will not be disposed-off sold/ transferred/ leased/ rented/transferred without prior approval of (AC-CG).

6.9 The PIO will not load DHI grants into the revenue formula, while determining the usercharges! fees.

6.10 The PIO will ensure that the services are offered to the CG sector units particularly thosebelong to Micro, Small and Medium Enterprises sector at charges equal to or lower than themarket rates, so that their cost of conversion is kept equal to or below global best practices.

6.11 The PIO shall also be responsible for adhering to law of the land including rules ofcentral, state and local Governments in its operation.

6.12 The PIO sha11indemnify and protect Government of India from a11costs, damages andexpenses arising out of any claim, action or suit brought against Government of India by thirdparties in respect of any infringement of any patent, registered designs or Intellectual PropertyRights resulting from use of any technical information, data or process or design belonging to orused by the PIO and! or furnished to Government of India.

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6.13 The PIO will adhere and follow the Labour Acts and Rules while executing this Contractand shall keep the Government of India indemnified and protected from. all claims, costs,damages and expenses arising out of any violation of Labour Acts and Rules.

6.14 In case the PIO proposes to import any equipment, software etc. for the purpose ofperformance of the job in India, all duties related to such imports shall be paid directly by thePIO to the concerned authorities. DBI will not bear any liability on this account. It will be theresponsibility of the PIO to provide the required particulars and documents to the Customsauthorities and other Government Authorities and get the materials cleared and transported intime. The PIO shall be fully responsible for the delays, demurrage, penalties, charges and losses,if any, in this regard.

6.15 The PIO, shall under the project cost, insure and keep insured all the machinery andequipment etc. acquired for implementation of the Project, for a minimum period of 5 years byutilizing the grant- in- aid. In case of loss or damage of such machinery and equipment, etc. theinsurance benefit will be payable to the Govenunent of India.

7 . MANDATORY OBLIGATIONS

7.1 It is obligatory on the part of TAGMA Centre of Excellence and Training (TCET),to ensure free access to AC-CG members, Review Committee Members/ DHI officials/ itsrepresentatives to all facilities/ assets and records relating to the project located at their works.

7.2 The PIO shall duly acknowledge DHI for funding this project in all publications, reports,publicity, presentations materials, assets/ facilities created, events etc.

7.3 The PIO shall furnish all deliverables of the project such as full documentation pertainingto common facilities (including machinery and equipment), design etc. to DHI.

7.4 The assets/ machinery acquired/ facilities created by the PIO wholly or substantially outof Govermnent grants, except those declared as obsolete and unserviceable or condemned inaccordance with the procedure laid down in the G.F.R., shall not be disposed-of, encumbered orutilized for the another purpose/ project, without obtaining the prior approval of the authoritywhich sanctioned the grants. In case of winding up or dissolution of the organization all theassets acquired to that effect out of the grants-in-aid by the Ministry should be returned forthwithto the Government of India.

7.5 The PIO shall be required to maintain subsidiary accounts of the Government grant andfurnish to the Accounts Officer a set of audited statement of accounts after utilization of thegrants-in-aid or whenever called for.

7.6 The annual report and audited accounts of the PIO will have to be submitted to theMinistry in Hindi & English in required numbers by the grantee to be laid on the table of theboth Houses of Parliament within stipulated period of the close of the succeeding financial yearof the grantee if the non-recurring grant is Rs.SO lakhs and above as one- time assistance.

7.7 The accounts of the grants shall be open for inspection by the authority approving thegrant- in- aid and audit, both by the Comptroller and Auditor General of India and Internal Auditparty of the Principal Accounts office of the Department of Heavy Industry whenever the granteeinstitution! PIO is called upon to do so.

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7.8 The PIO is required to submit performance-cum-achievement reports within a period ofone month after the end of the financial year.

7.9 The expenditure on any scheme should not exceed the approved cost of the respectivescheme and monthly targets of expenditure.

7.10 The grants-in-aid should not be a source of profit. If after examination of the AuditedAccounts, Ministry comes to the conclusion that the grants-in-aid have been source of profit,then the PIO shall forthwith refund the amount of grants-in-aid to Government ofIndia.

7.11 The grantee organization shall not utilize the interest earned on the recurring! non-recurring grants in aid, released to it for any purpose. The interest earned shall be indicated in theUtilization Certificate (UC) which can be either adjusted in the next release or to be refunded tothe Department of Heavy Industry after grants in aid sanctioned is utilized.

7.12 The PIO may keep in view all the economy instructions while incurring the expenditure.The organization shall not incur any expenditure on those items, the purchase of which havebeen banned.

7.13 A Penal interest is chargeable if the PIO fails to furnish progress report! AuditedStatement of Accounts! Audited Utilization Certificate etc. within the specified period afterrelease of grant- in- aid in the event of Sh011closure ofthe project due to non-technical reasons.

7.14 In the event of any liquidation or bankruptcy proceedings or any threatened distressaction against the PIO or any of its assets; machineries and equipment procured for the purposeof the Project out of or with the support of grant- in- aid shall be outside such proceedings andthe GOI may assume the control and management of the PIO and appoint any of its officer orauthorized representative to run the Project.

8. ROLE AND RESPONSIBILITIESORGANIZATION - DHI

OF.~

PROJECT COORDINATING

8.1 DHI will approve and provide grants and review the progress of the project.

8.2 A nominated Officer of DHI for the project will represent DHI in the Board/ GoverningCouncil/ Project Co-ordination Mechanism of PIO.

8.3 No financial decisions will be taken in the Board / Governing Council/such mechanismwithout the presence of the DHI nominee or without the approval ofDHI.

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8.4 DHI would release the funds to the PIO i.e. TAGMA Centre of Excellence and Training(TCET), in the designated Project Account for execution of the project depending upon thefinancial, technical and physical progress of the project and recommendations of the nodalofficer.

8.5 DHI will monitor utilization of Grants by PIO so that the funds released are utilized byPIO only for the purpose of the project component for which it is released.

8.6 DHI would be free to use the IPR/ equipment/ facilities; software procuredl developed forany scientific work or technology development/ demonstration purpose on their own or canrequest the PIO for use of this infrastructure by any other organization) agency or manufacturerfor scientific technology development/ demonstration! public purpose.

8.7 DHI will provide necessary certificates/ documents for facilitating approvals fromCentral Government under section 35 of IT act towards expenditure incurred on scientificresearch, wherever applicable.

8.8 Joint Secretary (BE& MT), DBI shall be the contact person for all matters concerning theproject.

9. MONITORING PROGRESS

9.1 The PIO will furnish the progress (Technical and Financial) of the project in reference tomilestones for each quarter within a month after completion of the quarter in compliance withparagraph 16.2 of the Scheme Guidelines. For the purpose of furnishing quarterly reports, the 1stquarter starts in April of every financial year. The Quarterly Progress Reports (QPR) are to befurnished in the prescribed formats for reporting technical and financial progress.

9.2 Joint Secretary (HE&MT) ofDHI (or his authorizedrepresentative(s)) will monitor theprogress of the project with reference to the milestones specified in the project schedule. Ifnecessary a team could undertake physical verification. DHI reserves the right to outsource full/part work of physical verification.

9.3 Progress reporting may be done online, if such a system is made available by DB!.

9.4 Grants linked to milestones will be released after physical verification of the reportedprogress and request of grant release.

9.5 Annual Reports of the Project will also be submitted along with financial year endUtilization Certificates.

9.6 Other steps for progress monitoring shall be as per the Notified CG Scheme Guidelineson November 5, 2014 and lor orders of Screening Committee.

10. PROJECT REVIEW BY DHI NODAL OFFICER

10.1 In case monitoring points to deviations, the progress of the projects will be reviewed bythe DHI Nodal Officer(s) along with beneficiary units in reference to .set Project Schedule/milestones and output.

10.2 Overall performance of the scheme will also be reviewed at least once in a year.

10.3 DBI Nodal officer will submit his report to the Screening Committee for its progressreview from time to time.

10.4 Other mechanism for monitoring shall be as per the Notified CG Scheme Guidelines tobe read with orders of Apex Committee issued in this regard from time to time.

11. PROJECT REVIEW BY APEX COMMITTEE OF THE CG SCHEME (AC- CG)

11.1 The Screening Committee will consider the report of the Nodal Officer and the quarterlyprogress Report furnished by the PIO and send its comments/ recommendations along with thecopy of the Quarterly Reports to the Apex Committee.

11.2 The Apex Committee will review the progress of the project which has been approved byit.

11.3 If necessary PIO and beneficiary units may be invited during progress review at AC-CG.

11.4 The AC-CG may send its own teams for physical verification, particularly in cases wherethe progress has not been as per milestones set.

11.5 The monitoring may bring out need for changes in approval of the project, which may beconsidered by the Apex Committee on their merits.

12. PROJECT REORIENTATION

The scope and the work! activities of the project can be re-orientated without deviating frombroad objective and scope of the approved project, based on the recommendations of nodalofficer, Screening Committee and approval of AC-CG

13. FUND UTILIZATION CERTIFICATE (UC) AND PROJECT ACCOUNTS

13.1 Before the release of subsequent grant, PIO shall submit the Fund Utilization Certificate(UC) in the specified format (Form GFR 19A) along with progress report and a certified copy ofproject account statement duly remarked / reconciled. '.

13.2 All Utilization Certificates indicating the financial statements shall be audited andcertified by "Accounts Officer" of the PIO or by authorized "Auditors" or "Head of Accounts".

13.3 The UC in respect of utilization of grants for the purposel object for which it wassanctioned should be furnished by the PIO with an audited statement of accounts, withinstipulated period of the closure of the financial year. The utilization certificate should alsodisclose whether the specified, quantified and qualitative targets that should have been reachedagainst the amount utilized, were in fact reached, and if not the reasons thereof. They shouldcontain an output based performance assessment. An UC of the released I utilized amount will besubmitted without fail before the end of the next financial year or before release of the nextinstalment of grant, whichever is earlier. It will contain a certificate that previous UCs (whereverapplicable) have been submitted to the satisfaction of the Department of Heavy Industry.

13.4 An interim UC shall be submitted, while making request for release of fund.

13.5 The project accounts will be maintained as per the GOI GFR and best practices. Name/sof authorized signatories will be informed to DHI.

l3.6 The Accounts duly audited by extemal auditors shall be forwarded to DHI at the end ofeach financial year.

13.7 Unspent balancesl bank interest I other earning will be taken into account in the Project.Any interestl investment returns received on account of DHI funds will be counted as DHI grantwithin the overall sanction. UC will contain statement of such income. The interest earned shalleither be adjusted in the next release or shall be refunded to the Department of Heavy Industryafter grants in aid sanctioned is utilized.

13.8 Grants I bank interest spent on purposes other than sanction will attract heavy penaltiesand other punishments as per the provisions of law of the land.

13.9 Utilization of Fund and maintenance of Accounts should be done in accordance withrelevant provisions of GFR and will be subject to Government auditsl CAG audits.

14 PROJECT COMPLETION & TECHNICAL REPORT

14.1 A proj ect will be deemed to be completed when all outcomes have been achieved.

14.2 The project completion (commercialization of technologies developedl acquired orfacilities created) will have to be assessed in consultation with beneficiary units.

14.3 The PIO will report the project closure to the Joint Secretary (HE&MT), DH!. TheReport will be submitted to the Screening Committee constituted under the Scheme.

14.3 The PIO along with industrial partner(s) from CG sector shall make a presentation to theScreening Committee on project completion.

14.4 DHI nodal officer and/or an Expert Committee appointed by the Screening Committeewill physically verify project completion and give their repOli to the AC-CG.

14.5 The AC-CG will finally approve the request of project completion on merits.

14.6 The PIO shall submit a Project Completion Report (Technical cum Financial) along witha soft copy in CD (preferably in MS word format) to the nodal officer in DHI within one monthof the completion of the project irrespective of holding of AC-CG. The PIO shall also furnish thefeedback, suggestions and project evaluation along with the project completion report. Suchcompletion reports will be used for CG-Scheme evaluation and drafting Roll-out Phase of theCG-Scheme.

14.7 Based on approval by AC-CG, DHI will issue project closure certificate and also settleany remaining grants/ financial dues.

14.8 Project time overruns will have to be justified to AC-CG/ DHI.

14.9 Project cost overruns are not entertained by DHI. However, DHI-AC-CG will have to bein loop including early warnings. Further action will be taken as per Government Orders.

14.10 Project failures (part or full) will have to be justified to DHI AC-CG. Further action willbe taken as per Government orders.

14.11 All decision of AC-CG will be binding on the PIO.

15. PATENT AND TECHNOLOGY TRANSFER MECHANISM

15.1 The parties recognise the intellectual property rights in all respect for each other.

15.2 Technology transfer fees and royalty, if any, shall be decided by mutual consent ofDHIand the PIO after achieving key milestones.

16. CONFIDENTIALITY

16.1 The PIO will maintain strict confidentiality and prevent disclosure thereof of allinformation and data exchanged/ generated pertaining to work assigned under this approval letterat all time except with prior consent of DHI.

16.2 This is subject to RTI and other laws of the land.

17. STATUTORY REQUIREMENTS

17.1 All aspects of this SPY will be carried out by the PIO in accordance with statutoryprovisions like Workmen's Compensation Act, Labour (Regulation and Abolition) Act, ContractLabour (Regulation and Abolition) Act, employees Provident Act or any other related enactmentpassed by the Parliament or State Legislature and any rules/ laws made thereunder by the eitherCentral or respective State Governments.

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17.2 Since the project is sanctioned to the PIO, it shall not be transferred to any otherInstitution. Transfer of project money within the Institution or with other Institutions under thesame Management is not permitted under any circumstances.

17.3 If the force majeure conditions continue beyond six months, DBI and the PIO shall thenmutually decide about the future course of action.

18. FORCE MAJEURE

None of the participating agencies/ bodies shall be held responsible for non- fulfilment oftheir respective obligations under this approval letter due to the exigency of one or more of theforce majeure events, such as but not limited to, acts of God, war, natural calamities such asflood, earthquakes etc. and strike, lockout, epidemics, riots, civil commotion etc. provided on theoccurrence of cessation of any such events, the party affected thereby shall give a notice inwriting to the other party within one month of such occurrence or cessation.

19. VALIDITY OF APPROVAL

The approval letter comes into force on the date of issue and is valid for a period of 5(Five) years from the date of issue or till the date of issue of Project Closure Certificate by DHIwhichever is earlier.

20. AMENDMENTS TO THE TERMS & CONDITIONS OF APPROVAL

No amendment or modification of terms and conditions shall be valid unless the same ismade in writing by DBI and the PIO or their authorized representatives and specifically statingthe same to be an amendment of this approval letter. On part of DBI approval of the ApexCommittee will be a pre- requisite for making any amendment to this approval letter. Themodifications/ changes shall be effective from the date on which they are made/ executed, unlessotherwise agreed to.

21. RESOLUTION OF DISPUTES

21.1 In the event of any dispute between DHI and the PIO, in the first instance, the sameshould be resolved mutually. For this, Secretary, Heavy Industry will be empowered to nominatea common panel of arbitrator.

2l.2 In the event of non-resolution, the matter shall be referred to arbitration to be held in NewDelhi as per the Indian Arbitration and Conciliation Act 1996. Costs shall be shared equally.

22. JURISDICTION

22.1 The instant Approval Letter issued by DHI and acceptance of the same by the PIO willconstitute an Agreement. The courts at Delhi shall have jurisdiction in all matters concerning thisAgreement including any matter arising out of the arbitration proceedings or any award madetherein.

23. GOVERNING LAW

Notwithstanding _anything contained in this Approval Letter, in case of any conflictbetween any of the provisions of this Approval Letter with provisions of DHI Notification on CGScheme dated 5.11.20141 General Financial Rulesl and other relevant Government Instruction(s)1Order(s), the latter will prevail. Right of interpretation of DHI Notification on CG Scheme dated05-11-20141 General Financial Rules/ Government Instruction(s)1 Order(s) for this purposeshall rest with the Secretary, Department of Heavy Industry.

24. Termination

24.1 Termination by DHI: DHI may terminate this arrangement upon 30 calendar days' noticein writing or after occurrence of any of the events specified in paragraphs below:

(a) If the PIO does not remedy a failure in the performance of its obligations under theAgreement, within 30 days of being notified of such a failure, or within such furtherperiod as DHI may have subsequently approved in writing;

(b) If the PIO becomes insolvent or bankrupt; or

(c) If, as the result of Force Majeure event, the PIO is unable to perform a material portion ofits obligations for a period of not less than 30 days.

24.2 Termination by PIO: PIO may terminate this arrangement upon 30 calendar days' noticein writing after occurrence of any of the events specified in paragraphs below:

(a) If DHI fails to make any payment due to the PIO pursuant to this arrangement within 30days after receiving written notice from the PIO that such payment is overdue; or

(b) If, as the result of Force Majeure, DHI is unable to perform a material portion of itsobligations for a period of not less than sixty days.

The termination of this arrangement shall not prejudice or affect in anyway, the rights andbenefits accrued or liabilities and duties assigned to the .Parties of this Approval letter.

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Appendix A(Paragraph 3.3)

ONE PAGE SUMMARY OF THE "PROJECT"

Common Engineering Facilities Centre (CEFC) at Chakan, Pune by TAGMA Centre ofExcellence and Training (TCET),

EXECUTIVE SUMMARY

Project Title Common Engineering Facilities Centre (CEFC) at Chakan,Pune by TAGMA Centre of Excellence and Training (TCET).

TARGET Tooling industry in and around Pune

Project Duration 2015-2016 (One year)

Project Outlay Rs. 51.92 crore ( including Rs.32.84 crore for machinery andequipment)

Main Sponsor DHI (Dept. of Heavy Industry), Ministry of Heavy Industry,GOI

Project execution TAGMA Centre of Excellence and Training (TCET).

Project Stakeholders: Tool and Gauge Manufacturers Association (TAGMA)

Objectives & Outcome of the Project:

The objective of the project is to upgrade the existing Tooling Industry in and around Pune bysetting up Common Engineering Facilities Centre (CEFC) for the Tools, Moulds and DiesIndustry. Its main focus would be on those activities and services which are not available withthe small and medium units like Tool Trial, validation, calibration set up, high endmanufacturing facilities etc. It would also have Skill Development Centre for training. TheCentre would run short term training courses with emphasis on practical training.

Benefits

Major benefits that the Tooling Industry in and around Pune would reap are State-of-the-artmachineries, improve speed of delivery and quality, enhance standards of cluster units, improveproduction capacity and product diversification, reduce reliance on getting services from othercountries, saving foreign exchange, reduction in tariffs and lead time, development of facilitiesnot available in the region, training facilities, tool repair facilities etc.

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Appendix B(Paragaraph 3.3)

Proposed Implementation Schedule

1.2 Design of Infrastructure Facilities1.3 Design of CFC & Administrative Block1.4 Estimate, Rate & BOQ

2 Construction

2.1 obilization

2.2 Site Clearance Grading & Set out2.3 Roads & Stann Water Drainage2.4 Water Supply, Sewarage & STP2.5 CFC & Administrative Block

Electrical Works

IS//21

Appendix C(Paragraph 5.2)

List of Machinery to be installed in TeET along with indicative cost

1) List of Equipment For Design Cell

Sl. Equipment Quantity Unit Prices AmountNo. (Rs. In Lakh) (Rs. In Lakh)1 CAD/ CAM Workstation with 4 6.50 26.00

Software2 Mouldflow Analysis 1 10.00 10.00

Total 36.00

2) List of Equipment For Tool Room

Sl. Equipment Quantity Unit Prices AmountNo. (Rs. In Lakh) (Rs. In Lakh)1. Lathe 4.00 5.00 20.002. Milling with DRO 2.00 14.00 28.00") Surface Grinder 2.00 12.00 24.00J.4. Cylindrical Grinder 1.00 10.00 10.005. CNC Lathe 2.00 15.00 30.006. Optical Profile Grinder l.00 40.00 40.007. Radial Drilling Machine 1.00 12.00 12.008. VMC/CNC Milling 2.00 70.00 140.009. Robo Drill! EDM Hole l.00 15.00 15.00

Drill10. CNCEDM l.00 20.00 20.001l. CNC Wire-cut 2.00 32.30 64.0012. Work Benches with Vice 4.00 0.30 l.2013. Die/ Mould Polishing Kit 1.00 3.00 3.0014. Bench Drill 4.00 0.25 1.0015. Pedestal Grinder 4.00 0.25 l.0016. Hydraulic Press 1.00 12.00 12.00

Total 421.20

3) List of Equipment of Heat Treatment Unit

Sl. Equipment Quantity Unit Prices AmountNo. (Rs. In Lakh) (Rs. In Lakh)

1. Metallurgical Microscope 1.00 25.00 25.002. Sample/ Test Piece l.00 l.00 l.00

Grinder/ Polisher

-, Belt Grinder/Polisher 2.00 1.00 2.00.J.

4. Mounting Press 1.00 S.OO S.OO5. Nitridingl Nitro-Carburising l.00 12.00 12.00

Furnaces6. Washing Machine 4.00 2.00 8.007. Vacuum Hardening & l.00 250.00 250.00

Tempering Furnace8. Shot Blasting Twin Table 2.00 10.00 20.00

Type9. Furnace- Hardening l.00 12.00 12.0010. Furnace-Air Circulating l.00 5.00 5.00

Tempering11. Quenching Tanks 2.00 2.50 5.0012. Over Head Crance-lOT l.00 15.00 15.0013. Spark Spectrum 1.00 20.00 20.0014. Micro Hardness tester 1.00 8.00 8.0015. Rockwell Hardness Tester 1.00 l.00 1.0016. Sample Cut-off Machine 1.00 1.50 1.50

Total 390.50

4) List of Equipment for Tool Try Out and Validation

Sf. Equipment Quantity Unit Prices AmountNo. (Rs. In Lakh) (Rs. In Lakh)1) Injection Moulding -63T 1.00 20.00 20.002) Injection Moulding-lOOT 1.00 25.00 25.003) Injection Moulding-150T 1.00 30.00 30.004) Injection Moulding- 250T 1.00 55.00 55.005) Injection Moulding-500T 1.00 90.00 90.006) Injection Moulding-650T 1.00 125.00 125.007) Injection Moulding-850T l.00 150.00 150.008) Injection Moulding-1600T 1.00 500.00 500.009) Mechanical Power Press- 1.00 25.00 25.00

64T10) Mechanical Power Press- 1.00 30.00 30.00

lOOT11) Mechanical Power Press- 1.00 65.00 65.00

200T12) Hydraulic Press-250- T 1.00 50.00 50.00

(Draw & Form)13) Mechanical Press-lOOT 1.00 75.00 75.00

(High Speed)14) Die Casting Machine-Cold 1.00 150.00 150.00

Chamber-250T15) Die Casting Machine-Cold 1.00 300.00 300.00

Chamber-SOOT16) Electric Melting Furnace- l.00 10.00 10.00

SOOKgs17) Coi1er & Decoi1er 4.00 0.65 2.6018) Straightner 4.00 0.50 2.0019) EoT Cranes -lOT 2.00 12.00 24.0020) Crane -250 T 1.00 30.00 30.0021) Chiller Units - 30 TR l.00 10.00 10.0022) Compressor -90 CFM l.00 4.00 4.0023) Pallet trolleys -5T 4.00 0.50 2.0024) Grinders for plastic 2.00 '.

5.00 10.00material

25) Mould Dehumidifier 5.00 8.00 40.0026) HRS Controller 3.00 l.00 3.0027) HRS 8.00 1.00 8.0028) MTC 4.00 2.00 8.00

Total 1,843.60

5) List of Equipment for Quality Analysis, Testing and Calibration Unit

S.No. Equipment Quantity Unit Prices Amount(Rs. In Lakb) (Rs. In Lakb)

1. Surface! Marking 4.00 1.20 4.80Table (Granite! CI)

2. Digital Height Masters 1.00 8.00 8.00'1 Profile Projector (SOXLens) 1.00 15.00 15.00J.4. 3D CMM Contura G2 1.00 .. 100.0 100.005. Digi tal Verneir Calli per 12.00 0.05 0.60

(0- 300)6. Micrometers 12.00 0.10 l.20

(Inside! Outside)7. Pin Gauge set 1.00 0.50 0.508. Slip Gauge Set 2.00 0.75 l.50

(Upto 100 MM)9. Depth Micrometer (0- 150 ) 2.00 0.75 l.5010. Dial Test Indicators 10.00 0.05 0.50

(Lever! Plunger Type)11. Bore Dial Gauge ( 6 - 150 ) 2.00 0.75 1.50

Total 135.10

6) A. List of Equipment for Skill Development Centre

S.No. Equipment Quantity Unit Prices Amount(Rs. In Lakh) (Rs. In Lam)

1. CAD/CAM 12.00 l.50 18.00Software (Educational)

2. CNC Simulators- 2.00 5.00 10.00Lathe/ Milling Kit

') Class-room Equipment 4.00 3.00 12.00.J.

4. Seminar/ Conference 2.00 5.00 10.00100Capacity

5. Work Benches 10.00 0.30 3.006. Drilling Machine 4.00 0.50 2.007. Lathe 4.00 4.00 16.008. Milling 4.00 8.00 32.009. Surface Grinder 2.00 12.00 24.0010. Pedestal Grinder 6.00 0.50 3.00II. LCD Projectors 4.00 0.75 3.0012. White Magnetic Boards 5.00 0.50 2.5013. Xerox/Copier/Scanner/Printer 1.00 3.00 3.0014. Binder .. 2.00 0.25 0.5015. CNC Lathe l.00 15.00 15.00

(training machines)16. VMCI CNC Milling - 5 axis 1.00 20.00 20.0017. Knowledge Information l.00 15.00 15.00

CentreTotal 189.00

6) B. List of Support Equipment for Skill Development Centre

S.No. Equipment Quantity Amount(Rs. In Lakh)

l. Tool storage cabinet -Godrej make, drawer 2.00 0.35type

2. Tool trolley -Godrej make 1.00 0.35') Plastic tool holders 50.00 0.20.J.

4. Wooden work bench l.00 0.37- 6' X 3', Medium duty

5. Steel Almirah - Godrej make, 6', high 2.00 0.306. Plastic drums - For chip storage 2.00 0.057. Anti - vibration mounts - For both 2.00 0.40

machines8. Isolation transformers - As per machine 2.00 0.60

current ratings

9. Cuttings tools and inserts -r- Lot 5.00For CNC turning centre

10. Cutting tools, inserts and holders - For Lot 7.00CNC machining centre

11. Hand tools set - Spanner etc Lot 0.1012. Measuring tools - Vernier, Micrometer, Lot 2.00

Dial Guages etc.13. Lubricating oil 5 ltr. 0.0214. Coolant oil 50 ltr. 0.06

Total 16.80

7) List of Support Equipment for the Centre

S.No. Equipment Quantity Unit Prices Amount(Rs. In Lakh) (Rs. In Lakh)

1. DG Set 100KvA 3.00 15.00 45.002. Compressor 2.00 4.00 8.003. Moveable Maintenance 4.00 0.50 2.00

Trolley"4. Air-condi tions- 52TR 1.00 50.00 50.00s. Hand Tools 4.00 0.50. 2.006. Cooling Tower 1.00 4.00 4.007. Water Treatment Plant 2.00 6.00 12.00

(DM Water)8. Consumable & Spares 1.00 5.00 5.009. Raw material Storage 10.00 0.50 5.00

Rack10. Tool Cabinets/ Racks 40.00 0.50 20.0011. ERP Software with Work- 2.00 15.00 30.00

station12. Pallets/ Trolleys 4.00 1.50 6.0013. Band-saw(Hydraulic) 2.00 4.00 8.0014. Furniture & Fixtures15. Computers/Laptops/Office

Equipment 1.00 50.0016. Communication17. Xerox, Copier, Scanner

Total 252:00

Appendix D(Paragraph 6.3)

TRUST RECEIPT

1. In the matter of approval letter dated I III 2015 by Department of Heavy Industry(DHI), addressed to TAGMA Centre of Excellence and Training (TCET), regarding the Projectfor setting up of Common Engineering Facilities Centre (CEFC) at Chakan, Pune.

2. The Plant, Machinery and Equipment though purchased in the name of TAGMA Centreof Excellence and Training (TCET) with the funds provided by DBI, for the subject project, willbe with TCET during the implementation of the proj ect and thereafter till they are useful for thepurpose stated in the above Approval letter.

3. The Plant and Machinery and equipment will not be transferred or disposed of by TCETwithout the prior written approval of DB I, and would remain with them.

4. IN WITNESS THEREOF TAGMA Centre of Excellence and Training has executedthese presents on DAY of November, 2015.

Signed by

SI.No. Name Ocw£ation & Address Signature -1

For and on behalf of the TAGMA Centre of Excellence and Trainingin the presence of Witnesses:

Sl.No. Name Occupation & Address Signature1

2.