1. Applicability: These general terms and conditions (“GTCs”) apply to all purchase orders (“PO”) issued by Hi-Q Electronics Private Limited (“Company”) to its vendors/service providers (“Supplier”), notwithstanding any conflicting, contrary or additional terms and conditions in any purchase order or other communication from the Supplier. No such conflicting, contrary or additional terms and conditions shall be accepted or deemed to be accepted by the Company unless expressly accepted by the Company in writing.
2. Quality of materials supplied or services rendered: All materials supplied by the Supplier to the Company (“Materials”) shall be as per the technical specifications provided by the Company and will be subjected to inspection and acceptance at the delivery location identified by the Company. All Materials supplied by the Supplier will be of the best quality and workmanship. All services rendered by the Supplier to the Company under this PO (“Services”) will be rendered by the Supplier in a timely and professional manner in accordance with the requirements and instructions provided by the Company’s authorized representative as notified to the Supplier from time to time.
3. Inspection of Material: The Company reserves the right to inspect all Materials supplied against the PO as per technical specifications and carry out such pre-inspection checks as per policies adopted by the Company from time to time. The Materials will be rejected by the Company, if found dissatisfactory in relation to its quality or quantity or terms of delivery or on account of non-compliance with the technical specifications provided by the Company. Net weight, volume, measurement determined by the Company will be treated as final and binding on the Supplier.
4. Rejection of Materials/ Services: The Supplier undertakes to replace the rejected Materials within the delivery period as mentioned in the PO or within the date as mutually agreed in writing between Company and the Supplier. All rejected Materials will be taken back by the Supplier at its own costs within [10 days] of intimation of rejection by the Company. Rejected Materials will, under all circumstances, be at the risk of the Supplier. Company will not be liable in any manner for any loss, shortage, quality or quantity deterioration or for any other mishap with the rejected Materials while in the possession of the Company. If the Supplier fails to remove the rejected Materials within the stipulated time period, Company will be at liberty to dispose off such Materials in any manner as it may deem fit and recover the costs incurred in such disposal from the Supplier. If any loss is caused to Company while the rejected Materials are lying in its premises, then the Company shall be entitled to recover all such losses from the Supplier. In the event the Services provided by the Supplier is not as per the instructions provided by the Company, the Company may at its sole discretion require the Supplier to: (A) re-perform the services at no additional cost to the Company; or (B) return the amount paid by the Company along with applicable damages within 7 days of receipt of written notice from the Company; or (C) pay the costs incurred by the Company to obtain such services from any third party.
5. Quantity Variation and Purchase Price: All supplies against a PO should not exceed the order quantity as specified in the PO. The Company will not permit any variation in the prices or addition of extra charges during the subsistence of this PO unless agreed to by the Company in writing. Any change to the PO terms or conditions should be duly acknowledged in writing, by the Company. In the event of any material change in the quantity/nature of Materials supplied/Services rendered, the Company and the Supplier shall agree upon the revised costs in writing.
6. Terms of delivery: The Supplier shall ensure that the Materials are delivered to the location identified by the Company withing the timeline set out in the PO. In the event the Supplier is unable to deliver the Materials/render the Services within the timeline set out in the PO, the Supplier shall intimate the same to the Company in writing. The Company shall at its sole discretion accept or reject any modification in the delivery timeline. In the event the Company rejects such modification of delivery timeline or the Supplier fails to deliver the goods/provide the Services within the agreed timeline, the Company shall be entitled to impose liquidate damages on the Supplier. The payment of such liquidated damages shall amount to 0.5% of the value of the undelivered Materials/Services for each completed calendar week of default, but in total not exceeding 5% of the value of the Materials delivered/Services rendered beyond the agreed timeline.
7. Acceptance of Materials: The title of the Materials will pass to the Company upon handover of the Materials post completion of the pre-delivery inspection and acceptance by the Company as per the policies adopted by the Company from time to time.
8. Payment Terms: The price for the Materials/Services rendered shall be those set forth in the PO issued by the Company to its vendors/service providers. All prices are inclusive of any applicable taxes. Unless expressly stated otherwise in the PO, the payment shall be made to the Supplier within 60 days from the date of receipt of an undisputed invoice. All invoices will contain the PO number and will be sent to the billing address of Company in a timely manner. The Company reserves the right not to pay the invoices which are delivered to the Company after 90 days of delivery of the goods or provision of the Services by the Supplier, as the case may be.
9. Representation and warranties: The Supplier represents, warrants and undertakes that: (A) it has full title, right, power and authority to enter into this PO and perform its obligations as per the terms and conditions stipulated in this PO; (B) it has complied with all applicable laws and obtained the required licenses/ consents/ permission from the relevant governmental authority in relation to the manufacturing and supply of the Materials to the Company and/or provision of Services as contemplated herein; (C) all the statutory dues, taxes, levies or any other dues payable to any statutory authority relating to the Materials is the Supplier’s responsibility and the Supplier will comply with the same; and (D) the Supplier has complied with all applicable tax laws (including in relation to compliance with applicable foreign exchange laws/ customs/ sanction laws etc.,) in relation to the supply of the Materials by the Supplier to the Company.
10. Confidentiality: The Supplier will keep in confidence any information obtained under this PO and will not disclose the same to any person (other than their employees on a strictly need to know basis) without the consent of the Company. The Supplier will as and when called upon by the Company return any material including the confidential information/material provided by the Company and provide proof of destruction of such confidential information from all systems used by the Supplier. The obligation of confidentiality under this PO shall be imposed on the Supplier beyond the term of this PO, unless agreed to otherwise by the Company in writing.
11. Intellectual Property Rights: The Supplier covenants that its owns and retains all right, title and interest in and to any patents, copyrights, trade secrets, trademarks and other intellectual property rights in relation to the Materials. The Supplier covenants that the manufacturing or supply of the Materials to the Company shall not result in breach of any applicable law or contract by the Supplier or expose the Supplier/Company to any third party claim or regulatory action.
12. Taxes and Duties: The Supplier shall ensure that the invoices issued by the Supplier to the Company shall be in compliance with all applicable tax laws. In the event of any breach or default or negligence in complying with applicable tax laws by the Supplier, this PO will stand cancelled or suspended, at the sole discretion of the Company. The Company reserves the right to recover from the Supplier the GST charged or any other tax payable/paid by Company on the Supplier’s account. If Company becomes liable for payment of any tax, interest, penalty on account of error in raising of invoices or levy of taxes by the Supplier, the Supplier hereby agrees to indemnify and hold the Company, its officers, directors, agents and authorized representatives harmless against all such claims. In case of any delay/denial of input tax credits pertaining to the taxes charged by any vendor of the Supplier under GST to Company on account of any errors/omissions/delay/ failure in complying with the provisions of applicable tax laws in India, the Company will recover such amounts along with interest and penalty forthwith from the Supplier.
13. Termination: Notwithstanding anything contained hereinabove, in the event the Supplier fails to perform its obligations or commits breach of any terms or conditions under this PO or where Company has reason to believe that continuing the business relationship with the Supplier may adversely affect its reputation, Company reserves the right to cancel this PO with immediate effect. Any amount or consideration or part payment made to the Supplier will stand refunded to the Company, within fifteen days from the date of cancellation of the PO, failing which the same will carry interest at the rate of [18% per annum] until its repayment. In the event of termination of this PO, the Supplier will be entitled to receive the payment for the Materials supplied and Services rendered by the Supplier till such date and duly accepted by Company prior to the date of such termination. Save as aforesaid, the Supplier will not be entitled to claim from Company any damages, compensation or any other amount whatsoever including for loss of profit, loss of business or loss of commercial opportunity on account of termination of this PO. The Company shall at its sole discretion be entitled to terminate the PO after providing [14 days’] prior written notice to the Supplier without incurring any additional costs.
14. Relationship of Parties: The Supplier and the Company are independent contractors. Nothing in this PO will be deemed to create a partnership, joint venture, franchise, employment or agency relationship between the parties. Neither party will have the power or authority to bind or obligate the other party.
15. Indemnity: The Supplier shall indemnify and hold harmless Company and its employees, directors, agents, affiliates, successors, assigns, customers and end users against any and all liabilities, damages, awards, settlements, losses, claims, and expenses, including reasonable attorney’s fees arising out of: (A) breach of this PO and/or applicable laws; (B) fraud, gross negligence and wilful misconduct by the Supplier and/or its agents or representatives; (C) supply of Materials/Services that are not compliant with the technical specifications/instructions provided by the Company; (D) any claim by a third party relating to infringement of intellectual property rights or regulatory action by governmental authorities in relation to the use of the Materials provided by the Supplier; (E) any damages/losses (whether direct or indirect) suffered by the Company and/or its officers, directors or employees on account of the use of the Materials/use of Services provided by the Supplier. The Supplier will at all times indemnify Company against all claims which may be made against Company resulting from this PO, including liability for payment of any statutory charges/compensation for non-compliance by the Supplier on account of accident or death of any person entering the premises of Company for and on behalf of the Supplier for the purpose of delivering, installing, inspecting, repairing or estimating supplies of Materials or for any Services rendered under this PO. In no event shall the Company have any liability for any incidental, special, statutory, indirect or consequential damages, including loss of profits, loss of business or revenue, loss of reputation. It being clarified that under no circumstances shall the aggregate liability of the Company under this PO exceed the aggregate amount paid by the Company to the Supplier under this PO.
16. Force Majeure: The Company reserves the right to suspend acceptance of Materials or Services against a PO in the event of break down at its factory/office premises due to war, civil commotion, riots, terrorist attacks, epidemics, floods, fire, strikes, industrial disputes, shortage of labour, demands or requirements of State or Central Governments, act of God or any other circumstances beyond the control of the Company. The Company will not be liable for any losses suffered by the Supplier due to any such suspension of acceptance of Materials or Services by Company caused by any force majeure event.
17. Warranty: The Supplier warrants that Materials will be free from defects in material and workmanship for a period of 12 months from the date of delivery of the Materials (“Warranty Period”). If the Company notifies the Supplier in writing of any defect in the Materials within the Warranty Period, the Supplier, shall at its sole discretion of the Company, either repair or replace the defective Materials supplied or refund the purchase price paid to the Supplier within 15 days from such notice being provided by the Company to the Supplier. The Supplier will be responsible for all costs associated with access, de-installation, re-installation, and transportation of the Materials to and from the Supplier.
18. Miscellaneous: The duly executed physical copy of this PO, along with the terms and conditions as enumerated above will be considered as a final and binding contract, conveying the intent of the parties and which will be admissible as evidence in case of any dispute between the Supplier and the Company. The Supplier will not assign/ sub-contract or part with or otherwise transfer the rights or obligations under this PO to any person without obtaining the prior written consent of the Company. If any provision of this PO is held invalid by a court, the same will not have the effect of invalidating the other provisions of this PO which will remain binding and effective. The terms set out in this PO shall override any other agreement, terms and conditions set out in writing or otherwise between the Company and the Supplier unless otherwise agreed to by the Company in writing.
19. Dispute resolution: Any dispute arising out of or in relation to this PO shall be at the first instance attempted to be resolved by way of mutual discussion between the senior management of the Company and the Supplier. In the event such dispute is not resolved within 30 days of such discussion, the dispute may be resolved by arbitration by a sole arbitrator mutually appointed by the parties in accordance with the provisions of the Arbitration and Conciliation Act, 1996 (as amended and modified from time to time). The seat and venue for arbitration shall be Bangalore, India and the arbitration shall be conducted in English.
20. Governing Law and Jurisdiction: This PO shall be governed by the laws of India and the courts at Bangalore shall have exclusive jurisdiction with regard to or in connection with any disputes arising under this PO.
Other Conditions:
1. Supplier shall establish and maintain a system for the control of quality that complies with the requirements of AS9100, or ISO 9001 or any other equal standard. The quality system shall be maintained to assure that all supplies and services are subject to examination and tests required to prove conformance to contract or purchase order requirements.
2. Hi-Q, their customer’s or Hi-Q appointed 3rd party inspection agency reserve the right to conduct inspection and/or surveillance to verify conformance to specified requirements.
3. The right extends to the plant and any sub tier supplier for materials intended for incorporation into the contracted product.
4. Hi-Q or Customer verification does not relieve the subcontractor of the obligation to provideacceptable product, and shall not preclude subsequent rejection by the customer.
5. You agree to keep confidential any materials or information furnished by us to you. You will not disclose or use, directly or indirectly, such materials or information for any purpose other than the purposes of this purchase order.
6. The suppliers quality management system shall provide for procedures which will assure that the latest applicable drawing, specifications and instructions required by the contract or purchase order, as well as authorized changes thereto, are used for fabrication, inspection and testing.
7. Changes proposed by you, both material and process change, which may affect form, fit, function, reliability, serviceability, performance, interchangeability, regulatory compliance, safety or interface with our equipment must be submitted along with a written change notice, for our approval. This change notice must be sent to us a minimum of ninety (90) calendar days in advance of the proposed implementation date. We then have fifteen (15) days to respond to you with approval of the change, or a request for sample evaluation by us.
8. Supplier shall notify Hi-Q if there are any changes in management, manufacture location and subcontractors and take necessary approval from Hi-Q in advance.
9. Supplier shall notify Hi-Q about the obsolescence material through EOL/LTB notification at least 3 months in advance for Hi-Q to plan alternate.
10. Copies of Hi-Q customer’s drawings, specifications, and/or procedures supplied by Hi-Q shall not be reproduced except for internal use. Such proprietary items shall be controlled to preclude their use other than contract work with Hi-Q.
11. If you work on our premises or the premises of our customer, you will comply with any applicable site rules and regulations, you and your employees, agents, and representatives visiting any of our premise of our customer’s premises shall be obligated to comply with our safety and security regulations or our customer’s regulations that may be in force on that site.
12. The supplier shall submit a first article to Hi-Q for approval. The first article shall represent the same material, fabrication, and processes as the production lot. Hi-Q acceptance of the first article does not represent the acceptance of the production lot or absolve the supplier from the responsibility of meeting the requirements of the purchase order and specifications.
13. Each shipment made by you shall include a packing list containing the Purchase Order number, product description as per our Purchase Order, quantity shipped, date of shipment, country of origin, Product weight, and such other information as we may reasonably request or is required by applicable law.
14. The supplier shall provide a Certificate of Conformance attesting that the processes and/or products meet the applicable drawing and/or specification imposed by the purchase order. The C of C shall be attached to the packing slip, and shall accompany each shipment. The C of C shall contain the signature and title of an authorized representative, as well as purchase order number, part number, revision, quantity, all processes performed, and the specifications and revisions to which they conform.
15. Legible and reproducible copies of chemical, physical test reports including lot, or batch numbers must accompany each shipment. These certifications must contain the signature and title of the authorized representative of the agency performing the test and must contain sufficient information to assure conformance to specific requirements.
16. The supplier shall maintain adequate records of all inspections and test. The records shall indicate the nature and number of observations made the number and type of deficiencies found, the quantities approved and rejected and the nature of corrective action taken. These records shall be available, and copies furnished upon request to Hi-Q. Records shall be retained for a period as required by contract or purchase order. If nothing specified, it must be retained for 15 years.
17. The supplier shall Flow down the quality requirements of this contract to any subcontractor used in the performance of this contract, including critical items, product safety, key characteristics and special requirements to their supplier wherever required. Variation in key characteristics needs to be managed through statistical control process wherever applicable.
18. The supplier’s quality management system shall provide procedures for notifying Hi-Q of nonconforming product and for the arrangements to obtain approval of supplier nonconforming product. The supplier shall take prompt action to correct conditions, which have or could result in nonconforming product being shipped to Hi-Q .
19. Time of delivery as mentioned in the purchase order shall be the essence of the contract and no variations shall be permitted, except with prior authorization in writing from Hi-Q.
20. Suppliers must certify that all products supplied to Hi-Q comply with ROHS/REACH requirements and certificate of compliance must be provided for every shipment as applicable.
21. Special processes used in the performance of this contract subcontracted outside of the supplier’s facility must be approved by Hi-Q before outsourcing. The supplier shall have appropriate control processes for sub-tier supplier management, assessment and improvement / development in order to ensure the required quality standard.
22. Date of manufacture and Expiry date, if any should be prominently indicated.(For items having shelf life). Any wrong parts shipped will be debited to your account including freight, clearing charges and duty. Goods which are having manufacturing date older than shelf life should not be dispatched.
23. The supplier shall ensure to supply products meets the requirement given in below table from the date of receipt of the product at HI-Q Electronics Pvt. Ltd. Chemical items shall only be supplied in appropriate and duly approved containers prescribed by the original manufacturer of the product.
24. Material should have ‘warning’ note indicated if any special precaution is to be taken, for storing. Suppliers should also send “Material Safety Data sheet”.(MSDS).
25. All Products received shall be subject to our acceptance or rejection. In the event the Products delivered by you do not meet our requirement, we shall have the absolute right (in our sole discretion) to reject or cancel the Purchase Order without any liability to make any payment whatsoever to you.
26. The supplier warrants that all material and or workmanship shall be of good quality and the material supplied under this purchase order shall be suitable for the purpose for which the same is to be used. The supplier shall guarantee that the material should be in strict compliance with the specification and requirements agreed upon the purpose for which the same is to be used.
27. As tests are carried out on sampling, Hi-Q reserves the right to reject the entire accepted lot supplied, if any defect is noticed in the bulk supplied.
28. Your Invoices shall contain the Purchase Order number, item number of such release, invoice quantity, unit of measure; unit price, total invoice amount, your name and phone number address to which remittance should be sent, and other such information as may be required by law or requested from time to time by us.
29. Delayed supplies will attract, poor vendor rating which may lead to cancellation of approval given.
30. Suppliers are expected to submit corrective action in time for any root cause traceable to supplier.
31. The actions that will be taken on the supplier for not meeting the requirements, will include the following
a. Corrective actions will have to be given by the supplier in case of delays in delivery or any quality problem traceable to the supplier
b. Penalty clause, as applicable for the quality or delivery issues
c. If the quality or delivery issue persists for three consecutive supplies, the supplier will be delisted
32. In case corrective actions are not submitted by the supplier for three consecutive issues, they will be delisted.
33. Configuration Management has to be followed for the process, if the supplier is AS 9100 Certified.
34. Qualification record of personnel to be submitted to Hi-Q for all special processes along with COC/Test Report.
35. Action on special requirements. Critical items, key characteristics .will be taken by supplier as defined in the PO/Drawings and records shall be submitted.
36. Supplier shall ensure all persons working in the organization are aware of
a. Contribution to product or service conformity
b. Contribution to product safety
c. Importance of ethical behavior
37. The Supplier shall have a counterfeit parts program in accordance with following standards to prevent the Counterfeit Parts reaching Hi-Q.
a. AS6174 – Counterfeit Materiel; Assuring Acquisition of Authentic and Conforming Materiel”
b. AS5553 – Counterfeit Electronic Parts, Avoidance, Detection, Mitigation and disposition.
38. The supplier must have an authenticity assurance plan to assure that only authentic and confirming material is procured from legally authorized sources to produce the materials that are delivered to Hi-Q.
39. The supplier should be capable of providing full traceability for the materiel being purchased, including names and addresses of prior sources.
40. “If found that any suspect/counterfeit material is supplied to Hi-Q, such items shall be impounded.
41. The supplier shall promptly replace such items with items acceptable to Hi-Q and the supplier may be liable for all costs relating to impoundment, removal, and replacement.
42. Hi-Q may turn such items over to Authority Having Jurisdiction for investigation and reserves the right to withhold payment for the suspect items pending the results of the investigation.
43. Any knowing and willful act to falsify, conceal or alter a material fact, or any false, fraudulent or fictitious statement or representation in connection with the performance of work under this purchase order may be punishable in accordance with applicable legal statutes.
44. If there are any counterfeit parts identified during incoming inspection at Hi-Q, the same will be scrapped at Hi-Q and will never get shipped back to supplier.
45. The Supplier shall ensure that all temperature sensitive materials are transported in temperature-controlled vehicles to maintain the required storage conditions.
46. The supplier is responsible for providing a data logger with each shipment to monitor and verify that the temperature remains within the specified limits during the transit.
47. If any of the above requirement is not met, then the supplier shall submit corrective action for approval.