IRD sign agreement with controversial Madras Security for printing Excise Duty Stickers

KATHMANDU: Finally Madras Security Printers got the responsibility of printing excise duty stickers. According to the Inland Revenue Department, the purchase agreement was concluded after the Supreme Court cleared the way for Madras Security Printers to pay the deposit for sticker printing.

Madras Security Printers is a company in charge of developing smart license system, card supply and printing in Nepal. Those who were not able to print the license on time according to the agreement, the system they created is still problematic.

After the joint bench of Justices Prakash Kumar Dhungana and Kumar Chudal dismissed the two cases before the Supreme Court regarding the excise sticker procurement process in the last week of August, Madras Security Printers, which was selected according to the old process, won the contract.

Ritesh Kumar Shakya, director general of the IRD, says that now the confusion about the printing of excise duty stickers is over. He claims that Madras will print and supply all the stickers within a year.

The tenders made by the department repeatedly became controversial. Until 2077 BS, the Inland Revenue Department was printing excise duty stickers through international contracts. However, after a dispute in the contract process, the government is printing excise stickers through government owned Janak Shiksha Samjari Kendra. There was a shortage of stickers because Janak Shiksha could not supply quality stickers as per the demand.

Although various foreign companies participated in the bidding process, before the contract was awarded, the sticker printing contract process was stopped due to the orders of the Commission for Investigation of Abuse of Authority, the Public Accounts Committee of the Parliament and the Supreme Court.

In the tender held in October 2020, the Indian company Madras Security Printers agreed in the bid that it will print the cheapest i.e. 9 billion stickers for about 18 million dollars (about 1 billion 42 million rupees).

However, before the contract was awarded, a petition was filed in the Supreme Court against the government saying that a domestic company should also be a competitor. The Supreme Court had ordered not to proceed with the procurement process.

However, in the last week of August, the Supreme Court canceled the interim order and opened the way for tendering. “Even after the Supreme Court’s order, Madras agreed to print stickers at the same rate,” said Director General Shakya. He says that this has saved time and additional costs as there is no need to go to a new process and the period of sticker supply has been shortened.

For the first time, the department called for a tender for sticker printing on 13 October 2020. However, one month after that, the CIAA instructed the government to hold a tender so that Nepali companies can participate in the tender. On 23 November 2020, the Public Accounts Committee under the Federal Parliament also reiterated CIAA’s instructions. On 1 October 2019, the committee sent a letter with another instruction saying that the instruction was not followed.

On February 12, 2019, the Supreme Court ordered that Nepali companies should also participate.

In July 2020, the IRD formed a committee to study the alternative arrangements for printing stickers. He gave a study report saying that although the Nepali company is eligible, there is no copyright protection law.

The tender was held for the second time in October 2020, but on 24 Dec 2020, the Supreme Court made a law and ordered the tender to include Nepali companies as well. However, after the writ was dismissed last August, the department has revived the old process and entered into a contract agreement.