CHAPTER XXIV
SCRAP AND AUCTION SALES
Meaning of Scrap, 2401
Schedule of Scrap, 2402
Collection of Scrap, 2403
Scrap for Workshop Use, 2404
Sorting and Storage of Scrap, 2406
Auction Sale of Scrap at Stores Depot, 2408
Disposal of Waste paper, 2409-A
"Lot" Register for Scrap, 2410
Survey Sheets for Scrap, 2411
Agency for Auction Sales, 2412.
Legal Position of Auctioneer, 2413
Agreement and Condition of Sale, 2414
Samples for Assay. etc., 2415
Auction Arrangements at Stores Depot, 2416
Presence of an Accounts Representative at Auction Sales, 2418
Register of Auction Sales, 2419
Deliveries of Stores, 2423
Auctioneer's Delivery Order, 2424
Ground Rent, 2425
Weighment and Delivery, 2426
Loading, 2433
Despatch of Auctioned Material, 2435
Freight Rates, 2436
Stock Verification, 2439
Monthly Lists of Deliveries, 2440
Report of Completion of Auction, 2441
Sale Accounts by Auctioneers, 2442
Bills for Commission Charges, 2443
Auctions by other than the Stores Department, 2444
Allocation of Financial Responsibility, 2446
CHAPTER XXIV
SCRAP AND AUCTION SALES
2401. Meaning of Scrap-There accumulates on every Railway a large quantity of material of different kinds which is no longer useful for the purpose for which it was originally procured. Such material is generally called "Scrap" and should be distinguished from other stores and component parts which can be utilised after repair or renovation. Scrap also consists of empties, turnings, borings, cut odds and ends of metal, sweepings, foundry ashes etc. which accumulates in Railway Workshops. Occasionally scrap may consist of second-hand or even new material which the Railway can neither consume itself nor can dispose of to other Railways.
2402. Schedule of Scrap-A detailed schedule of scrap should be maintained by each Railway Administration under group 98 of the State Railway Classification of Stores. In preparing the schedule the use to which the likely purchasers could put the material should be kept in view, so that the items may fetch a reasonable price in the auction sales. Scrap of different metals and alloys should be scheduled as far as possible under separate main headings, with suitable sub-headings describing the form in which the material is put up for sale.
2403. Collectionof Scrap: -
(1)Except for those items of scrap which the consuming departments have been authorised to dispose of, the Stores department should arrange for regular collection of all items of scrap from the consuming departments and for its disposal. If the scrap is to be disposed of by public auction, arrangements should be made for its collection at convenient points for the purpose of such sales, determined largely by the freight charges to be met, the room available for storage and the proximity to a market for such scrap.
(2)The Controller of Stores may however decide to dispose of any particular item of scrap at site or at the point of generation of scrap, it is more advantageous to do so.
2404. "Scrap for Workshop use.---Scrap suitable for use as raw materials for foundries & c. in railway workshops should invariably be reserved for such use, only the excess over such requirements being sold.
2405. In the case. of despatches of scrap from out stations, arrangements should be made to see that, double handling is avoided and that the scrap is sent, as far as possible, direct to the stores depot attached to the workshop concerned or to the depot at which scrap sales are conducted as the case maybe.
2406. Sorting and Storage of Scrap -When scrap is returned to the stores depot, the Officer or subordinate returning it, should see that it is sorted out according to the correct nomenclature of the Price List before it is actually despatched. On receipt in the stores depot, the scrap should be further sorted out, if found necessary.
2407. Suitable arrangement should exist in the stores depot to ensure that the scrap ready for sales is not mixed with other scrap that isbeing received. For this purpose, there should be kept, if it is possible to do so, two sets of scrap bins or dumps for each kind of scrap, so that the scrap accumulated in one set of bins or dumps could be set apart at any time for the purpose of auction sale and pending such sale, the other set of bins will be used for accumulating further scrap for the next auction.
2408. Auction sale of scrap at Stores Depots.-Before any item of stores can be sold as scrap', it should be declared as such by Survey Committee appointed by the General Manager of the Railway and the sanction of the competent authority obtained to such sale excepting where such sanction has already been obtained in terms of para 2228.S. The General Manager may relax this rule in the case of known items of scrap of small Value which is generally sold to Railway Employees.
2409. Scrap will be sold generally by auction but if the administration considers that more advantageous prices are likely to be obtained, other ways of disposal enumerated in para 2302. S
may be adopted.
2409-A. Disposal of Waste Paper.-Waste paper may be sold at the place of accumulation and if in any place there is insufficient accumulation to warrant its sale, it may be collected in the Stores depot by the stores delivery van on its journey wherever convenient.
It is not necessary to keep elaborate ledgers for the waste paper-A numerical account should however be kept. The value realised by the sale of waste papers whether collected in depot or elsewhere should be credited to "Traffic Earnings .
2410. "Lot" Register for Scrap - All scrap material accumulated for the purpose of auction sale should be separated into convenient 'lot' of a size that would suit the bidders at auctions. A 'Lot Register should be maintained showing the following particulars:
(1)'Lot' Number
(2) P. L. No
(3)Description of material.
(4)Approximate quantity
(5)Book Rate
(6)Rate in previous auction
(7)Sanction reference of Survey Sheet
(8)Rate at which sold
(9)Name of the purchaser
(10)Total value at auction rate
(11) Remarks (1)
2411. Survey Sheets for Scrap: - (1) Particulars of each lot should then be entered on the Survey Sheets (S. 2227) which are submitted to the Survey Committee as explained in paragraph 2227. It is one of the important duties of the survey committee to inspect each lot and record its recommendations on the survey sheets. The Controller of Stores should then obtain the sanction of the competent authority to the sale of such articles by auction if he finds he is unable to dispose of the same by transfer or sale to other railways, Government departments & c. excepting where such sanction has already been obtained in terms of Para 2228-S.
(2)Reserve Price; -Reserve prices based on the bids obtained at past auctions and any other information available should be fixed by the Controller of Stores or the depot Officer for such item of scrap to be sold in order that the item may be withdrawn from the sale, if the bids are found unsatisfactory. Bids lower than the Depot Officer where found expedient may however, accept the reserve prices provided the Depot Officer doing so records his reasons in writing.
AUCTION SALES
2412. Agency for Auction Sales -A Railway Administration may either conduct its auctions itself or enter into agreement with an auctioneering firm of repute and financial standing to handle the sale of railway materials by auction.
2413.Legal Position of Auctioneer The position of an auctioneer upto the fall of the hammer is that of an agent for the vendor, that is, the Railway Administration. The auctioneer thereafter becomes the agent of the highest bidder (the purchaser) as well, and a proper contract must be made bind both parties i.e. the Purchaser and the Railway Administration. The Conditions of Sale should therefore be drawn up before the sale. The auctioneer has no authority as the agent of the Railway Administration to warrant the goods, and he cannot add to or alter the particulars of Conditions of S by any verbal declaration made in the auction room at the time of the sale.
2414. Agreement and Conditions of Sales: - A skeleton form of agreement between a railway administration and a firm of auctioneers is illustrated in Appendix IX. Appendix X indicates the "General Conditions of Sales by Auction" which may be adhered to with advantage.
2415. Samples for Assay & c---Small quantities of scrap required by prospective bidders purposes of assay or other tests may be sold to them at schedule rates out of materials prepared into 1 for auction.
2416. Auction Arrangement at Stores Depot: -No auction should actually be started without the prior permission of the Controller of Stores. The Controller of Stores while according such permission should examine whether there is going to be any over-lapping of auctions by the auctioneer, either in respect of deliveries or payment of sale proceeds or both. Such overlapping shall avoided as far as possible. When, however, this is unavoidable, the Controller of Stores should consider carefully to see that the interests of the Administration are not jeopardised in any way.
2417. The Depot Officer or any other Officer nominated by the Controller of Stores supervise the auction will be responsible for the con duct of the auction.
2418. Presence of an Accounts Representativeat Auction Sales: - TheAccounts officer (Stores) who should have received timely intimation of the auction should depute an Inspector of Stores Accounts or a Stock Verifier as an Accounts Representative to witness the auction sale.
2419. From the catalogue and the Survey Sheets prepared for the auction, the Stock verifications witnessing the sales should post a manuscript register containing the following particulars
(1)Date of auction
(2)"LOT' Number
(3)P.L. Number
(4) Description of the material
(5) Approximate quantity
(6) Book rate
(7) Book value
(8) Sanction ref. of the Survey Sheet
(9) Name & address of the purchaser
(10) Auction Bid rate
(11) Delivery Order No. & date
(12) Quantity delivered
(1 3) Value
(14) Loss or gain on sale
(15) Issue Note No. &date
(16)Gate Pass Number & date
(17)Wagon Number
(18)Railway Receipt No. & date
(19)Loading charges
(20)Ground Rent recovered, if any
(21) Remarks
(22) Countersignature of Depot Officer
2420. Columns (1) to (8) should be posted before the sale. As lots are sold, columns (9) & (10) will be written up by the Stock-Verifier and at the end of the day the entries in his register will be compared with those in the auctioneer's (or Yard Foreman I s) statements. The rest of the columns in the Register should be filled up by the Stock Verifier from his Field Book (S. 2428) which will be his initial record in which the deliveries of such materials as they are affected will be noted.
2421. Material should not be sold at rates per lot but bids should be registered by a number or
weight unit so that a complete check on the quantity delivered can be exercised, at any time.
2422. The Sock Verifier should see that the Conditions of Sale are being observed and that stores are not being sold at obviously low prices. If he thinks that any irregularity is taking place or proper prices are not being obtained, he should bring the matter immediately to the notice of the, officer in charge of the sale and report the case in writing to the Accounts Officer, Stores.
2423. Deliveries of Stocks.-The Depot Officer should arrange for the deliveries being effected according to the agreement and terms and conditions of sale and such other specific or general instructions as may be issued by the Controller of Stores. He should take every possible step to expedite delivery of the auctioned materials.
2424. Auctioneer's Delivery Order-Before material is loaded for delivery, the purchaser has to present to the Depot Officer a Delivery Order, made out by the auctioneers authorising Stores Department to make such delivery. The Delivery Order should show the following particulars:
(1)Lot number
(2)Description of material
(3)Purchaser's name and address
(4)Approximate quantity in the. lot.
(5)Rate at which sold
(6)Value realised
(7)Reference to the Cash Remittance Note under which the amount shown in column 6 was remitted to the Railway's Cashier or Treasurer.
(8)Chief Cashier or Treasure's Receipt Note and date
(9)Amount of loading charges recovered by the Depot Officer.
Note.---(i) Columns 1 to 8 -will be filled-in by the Auctioneers, and column 9 by the Depot Officer.
(ii) An auctioneer's delivery order is not necessary when the auctioneer does not function as the Agent of the purchaser. The delivery may be made to the purchaser or his agent on the strength of theCashier’sReceipt.
2425. Ground Rent should be charged if the material not removed within the stipulated and the Accounts Representative will be responsible for seeing that where Ground Rent has become it is recovered by the Depot Officer before delivery of the Stores. The amount realised as Ground should be noted in the Issue Note by the depot and certified by the Stock Verifier. The Depot Officer be responsible to remit the cash to the Divil. Cashier or the local Station Master. In exceptional circumstances and when the Earnest Money paid by the purchasers is sufficient for the purpose, G Rent i.e. Storage Charges may be recovered after the delivery of the stores.
2426. Weighment and Delivery-All materials sold shall be weighed or counted delivery, this being supervised by:
(1)Stock Verifier
(2)Stores Supervisor of rank not less than D.S.K. Gr. Ill
(3)Representative of the purchaser (if he cares to be present)
(4)Representative of the Auctioneer (if he cares to be present)
2427. The Stock Verifier should count, measure or weigh each lot or part of a lot comparison of the description and quantity shown in the sale catalogue to ensure that only. Such hinds and quantifies of materials as have been shown in the catalogue are being issued; he should sign the gate passes and Issue Notes in token of such check.
2428. The Stock Verifier should maintain a Field Book (S. 2028) which will be his initial record for recording therein
(a)The lot number
(b)Description
(c)Rate
(d)Cart or wagon number, carrying capacity, and owning railway
(e)Gross Weight, actual tare or wagon or cart
(f) Net Weight
(g) Purchaser's name and address
(h) Particular of realisation of value
(i) Amount of Loading Charges recovered
(j) Issue Note number and date
(k) Gate Pass/Railway Receipt number & date and
(l) Amount and particulars of remittance of Ground Rent, if any.
2429. He should sign the issue note after fully satisfying him self that entries made there in agree with those in the field book. The field book should be attested by the Stores Representative making delivery of the goods in token of his having accepted the correctness thereof.
2430. In giving delivery of scrap material, scrap of non-ferrous items should be weighed on beam scales and the Stock Verifier in his field book should record the weight of each consignment in detail.
2431. For giving delivery of ferrous scrap empty wagons need not be weighed and the marked are of the wagons should be taken as the weight of the empty wagons. The loaded wagons should be passed over the weighbridge and the difference between the two weights will give weight of the scrap. In his field book, the Stock Verifier who should be present all the time, record the number, carrying capacity and the owning railway (marked) tare, gross weight and net weight of the wagons used. He should then seal up the wagons with the special seal supplied to him for the purpose. Particulars of the Railway receipt under which. loaded wagons are booked will be recorded.
2432. In cases where local delivery is given, the empty and loaded trucks or carts should be weighed and instead of Railway Receipt, particulars of the Gate Pass issued will be recorded. The Stock Verifier should countersign the Issue Note and the Gate Pass.
2433. Loading -The loading of the sold materials should be done under the supervision of the Depot Officer or his Assistant, not below the rank of D.S.K. Gr. III and should be witnessed by the Stock Verifier. The Depot Officer will be responsible for realising loading charges if any, from the purchaser. The Purchaser should not ordinarily be allowed to use his own labour for loading as the Railway's have little control on such labour.
2434. The responsibility of the Railway ends after the consignment has been loaded and made over to the representative of the auctioneers or purchasers and the railway will be, no party to any dispute that may arise after the loading has been completed. It is the duty of the auctioneer to arrange for the despatch of the consignment to the purchaser.
2435. Despatch of Auctioned Material : - In no circumstances should the Railway Department be shown on any of the despatching documents as consignors. The documents should be in the of the purchaser or his duly authorised agent who should sign them if necessary.
2436. Freight Rates - If the purchaser desires to send any of the stores by rail, they will be carried at public tariff rates only.
2437. Deleted.
2438. Deleted.
2439. Stock Verification.-At the conclusion of the delivery of the lot or lots pertaining to the item of scrap, any stock, left over should be verified by the Accounts Department with the book balance and any discrepancies adjusted. Such "left over" stock may be transferred to the bin in which fresh deliveries received since the auction have been stored.