SUMMER TRAINING PROJECT REPORT

ON

Contact execution at
BHEL Jagdishpur
BHARAT HEAVY ELECTRICALS LIMITED
INSULATOR PLANT,
JAGDISHPUR INDUSTRIAL AREA,
SULTANPUR (U.P.)
Submitted to:
Mr. P Lal (Dy. Manager, Commercial)

Bhagwant University Ajmer

(Raj.)
Submitted By:
Kripa Shanker Verma
M.B.A
Rol No.-108027023

BHARAT HEAVY ELECTRICALS LIMITED

INSULATOR PLANT,
JAGDISHPUR INDUSTRIAL AREA,
SULTANPUR (U.P.)
Certificate
This is to certify that the project report entitled Procedure of marketing and
finance department of Bharat Heavy Electricals Limited, Insulator Plant,
Jagdishpur, submitted to marketing (commercial) and finance department. This
study is a bonafied research work carried out by Mr. Abhishek Srivastava under our
guidance and supervision.
We further certify that all necessary help or source of information as has been
availed of in the connection, is duly acknowledged by them.
During their training period their performance and behavior is found
EXCELLENT.

Dated:
Place: Jagdishpur

P. Lal
(Sr. Engineer, Commercial)
P. K. Srivastava
(Manager, Finance)

DECLARATION

This is to certify that Mr. Kripa Shanker Verma students of MBA (200810) Bhagwant University Ajmer have successfully completed their
summer training in our departments under our guidance. We wish them
a very bright future.

P. Lal
(Sr. Engineer, Commercial)

P.K. Srivastava
(Manager, Finance)
BHEL, Insulator Plant, Jagdishpur, Sultanpur (U.P.)

ACKNOWLEDGEMENT
It is our proud privilege to express deep sense of gratitude regards an
appreciation to our guide Mr. P. Lal, Sr. Engineer (Commercial) and Mr.
P.K. Srivastava, Manager (Finance) for their invaluable guidance, deep
rooted interest, inspiration and continuous encouragement through out
our summer training which helped us to learn about the companys
working and to complete our project work.
We are also thankful to Mr. U. Das, Executive HR for his guidance
through out the project. We also want to extend our heart felt thanks to
Mr. Anil Srivastava (Assembling and Testing Department), Mr. S.P.
Singh (Purchase Department), Mr. Y.P. Singh (HR Department), Mr.
Manoj Kumar (Taxation Section), Mr. Sengar (Payroll Section), Mr.
Verma (Suppliers Payment Section) and Mr. Joshi (Sales Section) for
their continuous support and inspiration.
Finally, we are grateful to those who have directly or indirectly helped
us during the project work.

Kripa Shanker verma

MBA (2008-10)
Bhagwant University Ajmer

TABLE OF CONTENTS

Page No.
Introduction to BHEL. 5
Vision, Mission & Values of BHEL... 9
BHEL an Overview. 10
Human Resource Management...... 4
Products....... 17
International Operations... 20
Future Plans 23
BHEL at a Glance... 24
BHEL Jagdishpur 26
Performance of BHEL Jagdishpur for the year 2008-09 29
Process of Manufacturing Insulators 30
A Short History of Insulators 33
Marketing (Commercial) Department. 36
Finance Department... 45
Conclusion 49
Suggestion 50
Bibliography 51

INTRODUCTIN TO BHEL
BHEL is the largest engineering and manufacturing enterprise in India in the energy
related/infrastructure sector today. BHEL was established more than 40 years ago
ushering in the indigenous heavy electrical industry in India, a dream that have been
more than realized with a well recognized track record of performance. It has been
earning profiles continuously since 1971-72 and paying dividends since 1976-77.
BHEL manufactures over 180 products under 30 major product groups and caters to core
sectors of the Indian economy viz., power generation and transmission, industry,
transport, telecommunication, renewable energy etc.
The wide network of BHEL, 14 manufacturing divisions, four power sector reginiol
centers over 100 project sites.it services its customers and provides them with suitable
product, system and services efficiently and at competitive prices.
THE QUALITY AND RELIABILITY OF ITS PRODUCTS DUE TO EMPHASIS ON
DESIGN, engineering and manufacturing to international standards by acquiring and
adapting some of the best technologies from leading companies in the world, together
with technologies developed in its own R& D centers.
BHEL has acquired certification to quality management system ISO 9001:2000
environmental management system ISO 14001 and occupational health and safety
management system OHSAS 18001 and has also adopted the concepts of total quality
management.
BHEL HAS: Installed equipment for over 1, 15,356 MW of power generation for utilities,
captive and industrial users.
Supplied over 2, 25,000 MW transformer capacities and sustained equipment
operating in transmission and distribution network up to 400 KC-AC and DC.
Supplied over 25,000 motors with drive control system to power projects,
petrochemicals, refiners, steel, aluminum fertilizer, cement plants etc.
Supplied traction electrics and AC/DC locos to power over 12000 km railway
network.
Supplied over one million valves to power plants and other industries.

BHELS operations are organized around three business sectors, namely power
industry including transmission, transportation, telecommunication and renewable energy
and overseas business .this enables BHEL to have a strong customer orientation to be
sensitive to his needs and respond quickly to the changes in the market.
BHELS vision is to become a world class engineering enterprise, commited to enhance
stakeholder value. The company is striving to give shape to its aspirations and fulfill the
expectations as a Navratna company since more than 10 years.
The greatest strength of BHEL is highly skilled and committed 44,000 employees.
Every employee is given equal opportunity to develop himself and improve his position.
Continuous training and retraining, career planning, a positive work culture and
participative style of management have endeared development of a committed and
motivated work force leading to enhanced productivity and higher levels of quality.
BHEL manufactures a wide range of products and systems for thermal nuclear gas and
hydro based power plant to meet the customers requirement for power generation,
transmission and utilization. The products that BHEL manufacture are described below.
THERMAL
BHEL manufactures steam turbine generators and boilers with matching auxiliaries up to
500 MW.
NUCLEAR
In this field BHEL manufactures steam turbines and generators and shields and heat
exchange for 235 MW projects.
GAS
BHEL is the only company to manufacture large sized gas based power plant equipment
comprising turbines up to 200 MW.
HYDRO
BHEL engineers and manufactures has built francis, pelton and Kaplan type turbine,
pump turbines and minor-micro hydro plants with matching generators for different head
discharge combination. The maximum size of hydro equipment already built and installed
is 265 MW.

TRANSMISSION
BHEL supply a wide range of transmission products and systems up to 400 KV. These
include high voltage power and distribution transformers, instrument transformers, dry
type transformers, SF 6 switching gears cape electric citers etc for economic transmission
of bulk power over long distances. High voltage direct current (HVDC) technology is
now available. R & D projects for the development of equipment for 800 KV class are
progressing a pace resistance high alumina ceramic line material of power, steel cement
and mining industries as well as a wide range of industrial ceramics.
The product portfolio can be divided into three categories:
A) LT Type insulators
B) HT type insulators (Disc insulators)
C) Corallines
D) New products (hollow insulators & bus support insulators)

L.T. Type Insulators:

These are divided into four categories. They are I).Pin type (5/10 KN with creep age distance of 230/280/320mm)
ii) Guy/Stay/Strain type (53/89/110 KN with creep age distance of
63/70/75 mm
iii) Post type
Disc type insulators:
According to codes they are divided into:
Code Strength

(in KN)

01

160(CD-280mm)

02

70/90/120

03

45

06

120(CD-280mm)

08

210

11

120

14

70/90/120

15

70/90/120/160

17

70/90/120

Ceralin:
Under ceramic line products of Ceralins it manufactures bends cones ventury
canes O collars, Multiple discharge valves, multiport outlet, fuel Intel elbows,
and other applications, Flyash tiles and also produced as per customer
requirements. Bullet proof jacket and Catalytic converters are the products
under current development.

VISION, MISSION & VALUES OF BHEL AT A GLANCE

VISION
A world class
engineering enterprise committed to
enhancing stakeholders value.

MISSION

To be an Indian multinational engineering enterprise

providing total business solutions through quality
products, systems and services in the field of energy,
industry, transportation, infrastructure and other
potential area.

VALUES
: Zeal to excel and zest for change.
: Integrity and fairness in all matters.
: Respect for dignity and potential of individuals.
10

: Strict adherence commitment.

: Ensure speed of response.
: Foster learning, creativity and teamwork.
: Loyalty and pride in the company.

BHARAT HEAVY ELECTRICALS LIMITED

AN OVERVIEW
Bharat heavy Electrical Limited. (BHEL), a company with majority share
holding by the government of its kind in India and is among the 12 leading
equipment manufacturers in the world. The company was set up in the year
1956 with a view to reach self-sufficiency in Power and Industrial products
vital for the industrialization of India.
BHEL is organized along three Business Sectors, viz, Power, Industry and
International Operations. The main activities of Business Sector are
marketing, Project Engineering, Erection, Commissioning and service after
sales. The product Range of BHEL encompasses power generating equipment,
electrical and thermos mechanical equipment for industrial applications,
electrical traction equipment and urban transport systems.
The company has a workforce of 44,000 including technicians, skilled
workers and about 9,000 qualified engineers. BHEL today has 13
manufacturing plants and host of service divisions and around 200 projects
sites. BHEL major manufacturing divisions have already received
accreditation to ISO 9001/9002 BHEL has enjoyed an impressive growth
record since its inception and registered a turnover of approximately us$1.25
billion during the year 1992-1993.

POWER
BHEL has commissioned more than 800 Nos. utility and industrial sets
totaling to over 50,000 MW equivalent generating capacity. BHELs share in
utility generating capacity was approximately 64% of the installed capacity in

11

India in March 1993. Presently, BHEL has capacity to supply power

equipment equivalent to 7000 MW per year.
(A) Thermal Generation:
The unit sizes of utility stations in India range from 30 MW to 500 MW
BHEL has so for being responsible for over 2000 of these installations
accounting for over 40000 MW of installed generating capacity (utility)
which include sets up to 500 MW capacity. The technology for manufacture
of turbo generators comes from a comprehensive technical calibration
agreement with Scienes AG of Germany. BHEL manufactures steam
generator as per technology of M/S ABB Combustion Engineering of the
USA. This technology has been acquired through 20 years of
collaboration/license agreement. Both these collaboration covered unit ratings
up to 1000 MW.
Operating in an environment of high technology and severe competition as
BHEL does, the company has perform to stay abreast with the technology
leaders in the world. It is in recognition of such imperatives that BHEL has
technology tie-ups around the world for a variety of power station auxiliaries
as well.
BHEL has a well chalked out programmed to assimilate, adapt and modify
such acquired technology to suit differing economic, developmental,
geographic & climatic requirement. The company has also a full-fledged
Research and Development Division which undertake fundamental and
applied research in power and related fields. Research; is being carried out on
non-conventional energy sources as well. Several of these efforts such as
those in the areas of fluidized Bed Combustion, Solar and Wind Power have
already resulted in commercial ventures.
(B) Hydro Generation:
BHEL has supplied Hydro Sets upto 165 MW rating and 200 MW sets are
under manufacture, BHEL has facilities to manufacture and install sets of
even higher rating as per specific customer requirements. It also supplies
turbines for low head mini and micro hydro stations to meet the needs of rural
and backward areas located in the remote corners of the country. So far,
BHEL has commissioned mire than 200 Hydro Sets of various types and
capacities tattling to about 12000 MW.
(C)Nuclear Generation:
Indias first wholly indigenous Atomic Power plant at Kalapakkam near
Madras is equipped with two sets of power generation equipment of rating
235 MW each supplied by BHEL. Subsequently, another two sets of similar
rating have been commissioned successfully at Narora. BHEL is now
manufacturing sets of 500 MW rating for nuclear power stations.

12

(D)Gas Turbines based generators plants:

Today BHEL is fully equipped to supply simple/confined cycle/cozen plants
with various frame sizes of gas turbines of unit rating upto 200 MW. BHEL
has collaboration agreements with two leaders of has turbines technology in
the world namely general electric, USA and Siemens AG, Germany. The
agreement with GE, USA covers rating from 4.6 MW (ISO). The Siemens
agreement covers unit rating from 130 MW to 200 MW. So far BHEL has
supplied more than 33 nos. Has a turbine. All these turbines have been
supplied from our Hyderabad plant based on general electric, USA
technology. BHEL has bagged orders for two gas turbine based projects in
Malaysia, commissioning schedule of 6- 10 months. The first project has
already been commissioning in 6 months time. While the gas turbines of
GE/USA design are supplied from Hyderabad plant. With the plants (i.e.
Hyderabad and Hard war) are fully equipped with state of manufacturing and
testing facilities.
BHEL is fully equipped to supply waste heat recovery boilers from their
Tiruchirapalli plant. BHEL have an ongoing collaboration agreement with
M/S Henry volt, USA for the Waste Heat Recovery Boilers.
BHEL is supplying WHRSGS foe 6X30 MW gas turbines for Delhi electric
supply undertaking, and 817 MW Dadri Project of national thermal power
corporation limited besides those for other power stations.
(E) Transmission:
In addition to equipment for generating of power, BHEL supplies a variety of
equipment for transmission and utilization of power. The company has also
undertaken a number of turnkey sub-station contracts for voltage rating up to
400 kv class. Keeping with the KM long HVDC (High voltage direct current)
transmission line project line for reliable and efficient transmission of bulk
power. BHEL has in house capability to supply most of the equipment like
power transformer current transformer, voltage transformers switches,
insulators etc., and also possesses in house modern testing facilities.
Billions of BHEL manufactured insulators of various ratings upto 160 KN are
satisfactory service in many countries namely Turkey, Egypt, Malaysia, Iran,
Iraq, USA Libya, Tanzania Dubai and course India.
(F) Industry:
The industry Sector of BHEL offers diverse items such as Transformers,
Switcher, Rectifiers, Insulators, Capacitors, Control Gear, Valves
Compressors, Pumps, Piping, Motors, Industrial turbines oilrigs and
semiconductor devices to meet the varying needs of industry.

13

(G) Transportation:
For over quarter of a century, BHEL has been supplying drives and control
for traction equipment mainly to the Indian Railway, which is the third largest
Railway network in the world. Today, 65% of the rolling stock in Indian
contains electric of BHEL make such as traction motors, traction
generators/alternators, and transformers. The company has lately moved from
the position of supplier of electrics only to supplier of complete locomotives
-both diesels electric as well as A.C. Locos.
The urban transportation problem demands different solutions and BHELs
contribution extends to underground tube, light rail and battery powered road
vehicles

(H) Services
(a) Project Engineering:
The total engineering for thermal power stations is undertaken by a core
group project engineering management. With over 500 engineers and
supporting staff, this division offers specialized service in different technical
disciplines and undertakes engineering works relating to optimization of cycle
configuration selections of parameters and design of suitable system for
power stations with a total MW capacity of 30000 and is currently involved in
several turnkey project including stations having 500 MW unit size.
b) Constructions Management:
BHEL has a full-fledged construction management division to undertake
erection work. This division well organized with over 500 experienced
engineers,1000 technicians and 1300 skilled workers besides construction
equipment valued at over 40 million US Dollars.
c) Service After sales:
BHEL extends its supply and construction scope with service such as
commissioning field engineering performance monitoring trouble shooting
operation and maintenance. Renovation modernization and rehabilitation
works of aged power stations are also undertaken. BHEL has a separate spare
group response for insuring ready availability of essential spares to Power
stations.
d) Projects Management:
The project management division of BHEL coordinates th4 entire range of
BHEL activities in relation to thermal power plant project and is responsible
to the purchasing organization for compliance of the specifications. Entrusted

14

with the overall coordination of the project the division initiates, directs
coordinates, supervises and control all activities that are necessary for the
performance of the project right from the conception stage until the
contractual obligations are fully discharged.
BHEL offers a wide spectrum of products and services for core sectors like
power transmission industry, transportation, oil & gas telecommunication etc,
deseeds supply of non-conventional energy systems. It has also embarked it to
other areas including defense & aviation.

HUMAN RESOURCE MANAGEMENT

1. Industrial Relations
The Industrial Relations at various Units and service divisions of the Company were
harmonious and cordial during the year under report. Thrust to develop and nurture the
participative culture in the Company continued during the current year also. The elections
of the Unions through secret ballot at various Manufacturing and Service Divisions for
representation at the apex level Joint Committee were held in July, 2002. Accordingly,
Joint Committee for BHEL was reconstituted. Subsequently, a seminar for the orientation
of new members of the reconstituted Joint Committee and familiarization with the issues
related to the Company was held at Hyderabad for 2 days in October, 2002.
A two days' workshop was also conducted in November, 2002 for Supervisors and
Executives on Enhancing Organizational Effectiveness. The objective of the workshop
was to bring about better understanding and appreciation of the issues being faced both
by the Company and the employees.
The apex level bipartite forum viz. Joint Committee for BHEL held 3 meetings while the
Plant and Shop Councils held 51 and 236 meetings respectively during the year at various
Units of the Company.
2. BHEL Excel Awards
Inspired by the ideal of 'Yoga Karmasu Kaushalam', the Board of Directors of BHEL in
its 320th meeting held on 30th October, 2000, took a historic step by approving BHEL
Excel Awards Scheme to institutionalise the culture of Excellence in BHEL. The first
such awards were presented for 2000-01 on 13th January, 2002. The objective of the
scheme is to recognise, reward and place on record any direct or indirect outstanding and
exemplary contribution by the employee towards growth and profitability of the
company. The scheme stipulates the following nine categories of awards, each valuing up
15

to Rs. 50,000 in case of an individual, and up to Rs. 5 lakh in the event of a group/team
winning the award.
1. BHEL Utkrishthta Puraskar
2. BHEL Gunvatta Puraskar
3. BHEL Tatparta Puraskar
4. BHEL Utpadakta Puraskar
5. BHEL Utkrishtha Takniki Lekh Puraskar
6. BHEL Anusandhan Puraskar
7. BHEL Srijanatmakta Puraskar
8. BHEL Grahak Santushti Puraskar
9. BHEL Paryavaran/Samaj Seva/Sanskriti/Khel Puraskar
While the first eight awards are for the company employees only, the ninth award covers
spouses and dependent children of the employees also.
The Scheme also stipulates Swasth Karamchari Samman which are given to employees in
appreciation of good health. The Samman is at the unit level for employees who do not
claim any medical reimbursement for self and also do not avail any leave on account of
sickness in the previous financial year.
The 106 nominations, received from various units/ divisions for the year 2001-02 were
scrutinized and short listed by a Screening Committee. The short listed entries were
evaluated by the Jury constituted by CMD. The awards have been announced in 8
categories to a total of 50 employees/family members and 2 token awards in 25
recognition of individual skills. Their outstanding contribution is hailed as a significant
milestone in BHEL's journey towards excellence. A word of appreciation to all those who
participated and shown the zeal to excel. The journey of excellence will go on unabated
with ever increasing vigour.
3. Awards won by BHEL Units and Employees
SCOPE Award for Excellence and Outstanding Contribution to the Public Sector
Management - Individual Category. Shri K.G.Ramachandran, Chairman and Managing
Director, has won the coveted SCOPE Award for Excellence and Outstanding
Contribution to the Public Sector Management, for the year 2001-02, in his individual
capacity for his outstanding contribution to Public Sector management. The award carries
a cash amount of Rupees One Lakh and a Golden Plaque.
"Achiever of the Year Award" by CHEMTECH Foundation Shri K.G.Ramachandran,
Chairman and Managing Director, has been awarded the "Achiever of the Year Award" by
CHEMTECH Foundation, in recognition of his contribution to industry, under the
category of Power Plant and Machinery Industry. He was unanimously selected by the
awards committee, comprising some of the most prominent industrialists of the country.
Prime Minister's Shram Awards Prestigious "Prime Minister's Shram Awards" instituted
by Ministry of Labour namely Shram Bhushan, Shram Vir and Shram Shri have been
won by four BHEL employees for the year 2002. This is the highest number of awards

16

won by BHEL since the inception of the awards in 1985. Vishwakarma Rashtriya
Puraskars Six Vishwakarma Rashtriya Puraskars, for the year 2000 were won by 19
employees of BHEL. The award is instituted by Ministry of Labour. National Safety
Awards Four BHEL Units, i.e. Tiruchy, Hyderabad, Electronics Division - Bangalore and
Electro porcelains Division - Bangalore, won National Safety Awards for the year 2000.
The award is instituted by Ministry of Labour. "Excellence in Energy Management"- CII
Awards HEEP-Haridwar Unit has been awarded a certificate in the category of an
"Energy Efficient Unit", along with other companies, in the competition held in
December, 2002 at Chennai by CII.

INSSAN Awards
Hyderabad Unit has won the first prize for Excellence in Suggestion Scheme, Best
Suggestor Award and two Best Slogan Awards in the INSSAN National Convention for
the year 2002. These awards are instituted by the Indian National Suggestion Scheme
Association (INSSAN). Those details of the awards won by Hyderabad Unit are:
a) Excellence in Suggestion Scheme
b) Best Suggestor Award
c) Best Slogan Award (Hindi)
d) Best Slogan Award (English)
4. Human Resource Development
During 2002-03, 40466 participants were exposed to different training programs in our
various training Centers at Units as well as at apex level in NOIDA. Besides, 3700 Act
Apprentices and 1300 Technician Apprentices were also provided with training at our
Units, as part of fulfillment of our social obligation towards the society.
Also, towards our ongoing efforts for higher customer satisfaction, around 1100
customers' personnel were provided training inputs on our products at Training Centers in
the Units.
5. Activities of the company for welfare and
Advancement of Scheduled Castes (SCs)
And Scheduled Tribes (STs)
The company has been following the Presidential Directives and guidelines issued by the
Government of India from time to time regarding reservation for SCs and STs in letter
and spirit. During the year, the various Community Development activities focused on
Socio- Economic development of SCs and STs have been carried out by BHEL in the 56

17

villages adopted by it. Representation of SC/ST employees the representation of SC/ST

employees in total manpower was 18.13% and 3.73% for SCs and STs respectively as on
1/1/2003

PRODUCTS
Industrial fans Power generation & Transmission
Sam less Steal tubes
Steam Turbine-Generation Sets & Auxiliaries
Fabric Filter
Boiler and Boiler Auxiliaries
AC/DC Motors, Variable Speed
Once through Boilers
AC Drives
Nuclear Power Generation Equipment
Electronic Control Gear & Automation
Hydro turbine-Generator Sets & Auxiliaries
Equipment
Mini/Micro hydro Generator Sets
DDC for Process Industry
Gas Turbine-Generator Sets
Thirstier Equipment
Waste Heat Recovery Boilers
Power Devices
18

 Heat Exchangers
Energy Meters
Condensers
Transformer
Bowl Mills and Tube Mills
Gravimetric Feeders
Insulators
Regenerative Air Pre-Heaters
Capacitors
Electrostatic Precipitators
Broad Gauge, AC,AC/DC Locomotives
Bag Filter
Diesel- Electric Shunting Locomotives
Valves
Tractions Motors
Pump
Electric Trolley buses
electric Machines
AC Electric Multiple Units
Piping System
Drives & Control for Metro system
Power, Distribution 7 Instrument Transformers - Battery Operated Passenger
Vans
Reactors
Oil Rigs & Oil Field Equipments
Synchronous Condensers
Digital Switching System

19

 Switchgear
Rural Automatic Exchange
Control Gear
Simulators
Distributed Digital Control for Power station
Wind Electric generators
Bus Ducts
Solar powered Water Pumps
Porcelain Insulators
Photo Voltaic System
Ceralins
Defense Equipments/Oil/Gas
Reverse Osmosis Desalination plant/ Telecommunication /Renewable Energy
System Turbine
Generator Sets
A dynamic 67000 Strong team embodies the BHEL philosophy of professional
excellence with corporate headquarters in New Delhi: BHEL is Indias ambassador to
the world with export presence in more than 50 countries.
BHEL has a consistent tract of growth performance & profitability.

20

INTERNATIONAL OPERATIONS
BHEL has over this year established its references in around 60 countries of the world
ranging from United States in the west to New Zealand in the East. These References
Encompass almost the entire product range of BHEL covering turnkey power project of
thermal hydro and gas based type substation project, rehabilitation project, based a wide
variety of project, like transformers, insulators, switchgears, heat exchanger, casting and
forging, valves well-head equipment etc. Apart from over 1110 MW of boiler capacity
contributed in Malaysia and execution of four prestigious power project in Oman, some
of the other major successes achieved by the company have been in Australia, Saudi
Arabia, Libya, Greece, Cyprus, Egypt.
Technology Up gradation and Research & Development to remain competitive and meet
customers expectations, BHEL lays great Emphasis on the continuous up gradation of
product and related technologies and development of new project works. The company
has upgraded its product to contemporary levels through continuous in- house effort as
well as through acquisition of new technology from leading engineering origination of
the world.
The Corporate R&D Division at Hyderabad, spread over a 140 acre complex leads BHEL
research efforts in the number of areas of importance to BHELs product range research
and product development center at each of the manufacturing division play a
complementary role.
BHELs investment in R7D is among the largest past several state-pf-the art product
developed in housing during the last five years contributed about 8.6% to the revenues in
2000-2001 BHEL has introduced in the recent past several state of the art produced
developed in housing: low-Nox oil gas burner, circulating fluidized bed combustion
boilers high efficiency Pillion hydro-turbines, petroleum depot automation system, 36KV
gas insulated sub stations, etc. The company also transferred a few technologies
developed in-housing to other Indian companies for commercialization.
Some of on going developed & demonstration project include: Smart wall blowing
system for cleaning boiler soot deposit , and micro- controller based governor for dieselElectro-locomotives . The company also engaged in research in futuristic areas, such as
application of super conducting materials in power generation and industry, and fuel cells
for distributed environment friendly power generation.
21

HUMAN RESOURCE DEVELOPMENT INSTIUTE

The most praised asset of BHEL is its employers. The Human Resource Development
Institution and other HRD centers of the company help in not only keeping their skills
updated and finally honed but also in adding new skills, whenever required Continuous
training and retraining, a positive work culture and Participative style of management,
have engendered developed of a committed and motivated workforce, leading the
enhanced productivity and higher levels of Quality.

MANAGEMENT HEALTH SAFETY AND ENVIROMENT

BHEL is the integral part of business performance and in its endeavor of becoming a
word class origination and shearing the growing global concern on issue related to
environment in and around its own establishment, and to provide safe and healthy
working environment to all its employers.
For fulfilling these obligations, Corroborate Policies have been formulated as;
Environmental Policy:
Compliance with applicable Environmental Legislation/ Regulation;
Continual improvement in Environmental Management System to protect our
natural environment and Control Pollution;
Promotion of activities for conservation of resources by Environmental
Management
Enhancement of Environment awareness among employees, custom & suppliers
BHEL will also assist and cooperate with the concerned governmental Agencies
and Regulatory Bodies engaged in environmental activities, offering the
companys capabilities in this field.
Occupational Health and Safety policy:
Compliance with applicable Legislations and Regulations;
Setting objectives and targets to eliminate/ control /minimize risks due to
Occupational safety Hazards;
Formulation and maintenance of OH&S Management Programs for continual
improvement.
Product review of OH&S Management system to ensure it continuing suitable
adequacy and effectiveness;
Communications of OH&S Polices to its all employees and interested parties.

22

The major units of BHEL have already acquired ISO14001.Environmental management

system certification, and other units are in advanced stages of acquiring the same. Action
plan has been prepared to acquire OHSAS 18001Occupational Health and Safety
Management systems certification for all BHEL units.
Participation in the Global Compact of the United Nat the Global Compact is a
partnership between the United Nations, the business Community, international labour
and NGOs. It provided a forum of them to work together and Improve corporate practices
through co-operation Compact of United Nations and has committed to support it and
the set of core value ensured its nine principles.

PRINCIPLES OF THE GLOBAL COMPACT

HUMAN RIGHTS
1. Business should support and respect the protection of internationally proclaimed
Human rights
2. Make sure that they are not complicit in human rights abuse.
Lab our standards
3. Business should uphold the freedom of association and the effective
Recognition of the rights to collective bargaining.
4. The elimination of all forms of forces and compulsory labors.
5. The effective abolition of child labor
6. Eliminate discrimination.
7. Business should support a precautionary to environmental changes.
8. Undertake initiatives to promote grater environmentally responsibility.
9. Encourage the development and diffusion of environmentally friendly techniques by
joining the Global Compact , BHEL would get a unique opportunity of networking
with corporate and sharing experiences related to social responsibility on Global basis.

FUTURE PLANS
As a part of forward integration strategy the company plans to enter into the power
distribution business. The company already manufactures product required by the
distribution systems like transformers, switchgears etc.
BHEL has announced that it will launch a B2B portal, keeping in mind its core
competency-power systems. As per the company announcement it could take them four
23

to six month to announce the location of its new business. The company is planning
towards becoming an application service provider.
The company will continue to focus on project management reducing cycle time and cost
control. In the power sector, the company plans to obtain a part of the business generated
by independent power producers through a combination of approaches including
consortium route, equity participation and limited financial syndication. BHEL would
also put additional emphasis on spares and service business for hydro and thermal plants.
BHEL is introducing a number of new products like 3-phase traction electric and advance
class gas turbines in the Indian market.
It is equipping it self with the new type of once-through design boiler technology, and for
pollution control-bag filter technology. BHEL is planning to enter new business in
integrated gasification combined cycle system, coal washeries and LRT systems. In its
existing businesses of transportation, transmission and industry. BHEL is pursuing
opportunities in EMU coaches, loco refurbishment, gas-insulated switcher, HVDC
insulators and electronic meters.
The company will continue to focus on product development in order to foster its growth
strategy. New products are expected to contribute 46% of its total turnover. The
electronics division has frayed into traction business and received a large order from Dot
for switching equipment for 0.25mm lines. The Industrial System Group has bagged
orders from BWSSB for water pumping stations (Cauvery Stage IV), funded by Japan
Bank for international cooperation. The electro porcelains division is now manufacturing
HVDC disk insulator and its catalytic converter has also passed the entire test.

BHEL AT A GLANCE
Rupees (In Million)

2003-04
2004-05

24

CHANGE (%)
Turnover

Value Added

Employee (Nos.)

Profit Before Tax

Profit After Tax

Dividend

Dividend Tax

Retained Earnings

Total Assets

Net Worth

Total Borrowings

Debt : Equity

86625
103364
19.32

36800
42540
15.60

43952
43302
-1.48

10148
15816
55.85

6582
9534
44.85

1469
1958
33.29

190
266
40.00

4923
7310
48.49

116564
144915
24.32

52781
60269
14.19

5400
5370
-0.56

0.10
0.09
-10.90

Per Share (in Rupees) :

- Net worth

215.64
246.24

25

14.19
- Earnings

- Dividend

26.89
38.95
44.86

6.00
8.00
33.33

(US $ in million)
Turnover

Profit Before Tax

Profit After Tax

1976
2371
19.98

232
363
56.71

150
219
45.65

Conversion Rates (Rates as on 31st March) :

1 US $ = Rs. 43.83 for 2003-04
1 US $ = Rs. 43.59 for 2004-05

26

27

INSULATOR PLANT - BHEL, JAGDISHPUR

The insulator plant BHEL, Jagdishpur was set up in 1984, catering to electric power
transmission business by way of manufacture and supply of disc insulator. Presently the
plant is geared to produce 19 thousand tons of disc insulators annually and one thousand
tons of Ly. of insulators. Over the year lot of technological innovation have taken place in
the plant which has streamlining of manufacturing processes & has taken it in to the level
of best industry. New type of disc insulator has also been introduced periodically and
today it manufactures disc insulators up to 160-Kn.Stength ranging from normal to anti
fog type. The plant has till date executed many prestigious export contracts and has
supplied disc insulators to Turkey, Malaysia, Trinidad & Tobago, Ghana, and Nigeria
etc.
Since 1994, low tension types of insulators have also been introduced in the product
range in addition it supplies to domestic market quantities have also been exported to
countries like UK & South Africa. In present area of liberalization the company has not
only gone for diversification but also has taken concrete measures for organizational and
product improvement by ISO-9001 certification and adopting iqm approach.
In the present world an attempt has been made to system erotically analyze the export
market requirements of insulators and identify the product forming bulk exports. The
world market scenario of insulators imports have been presented with a view to provide
strategic global market information for insulator exports. On 3rd march 1984 the prime
minister of India Smt. Indira Gandhi inaugurated BHELs 11th manufacturing unit in
Jagdishpur Sultanpur district,78 kilometers away from Lucknow, on the Lucknow
Sultanpur highway.
BHELS more than 40 years experience in the ceramic field ,blended with that of NGK,
Japans world leader in insulator technology, set the pace for been provided with the
most modern and sophisticated facilities, and was commissioned in a record line of 18th
months.
Insulator plant Jagdishpur has developed into one of the Indias disc insulator
manufacturing centers with the most streamlined layout and modern technology.It6 has
provisions to cope with latest advances in the ceramic field.

MAJOR RIVALS OF BHEL INSULATOR PLANT, JAGDISHPUR

JAI SHREE INSULATORS, KOLKATA (BIRLA GROUP)
WS INSULATORS, KOLKATA (WEST BENGAL)
MODERN INSULATORS, CHENNAI
IEC, KOLKATA (WEST BENGAL)

28

 BATHINDA CERAMICS, PUNJAB

HI-TECH, KHURJA (U.P.)
POWER TECH, KHURJA (U.P.)

MAJOR CUSTOMER OF BHEL IP JAGDISHPUR

Jagdishpur insulator plant has some important customer which are state electricity board,
government organizations, public sector units and private customer and Indian railways.
STATE ELECTRICITY BOARDS
UPPCL
MPSEB
GEB
PSEB
KSEB
KPTCL
TNEB
MSEB
PUBLIC SECTOR UNITS
POWER GRID
NTPC
NHPC
DVC
NLC

Government Organizations
Govt. of Tripura
Govt. of J&K
Govt. of Mijoram
Govt. of Manipur

Private Customers
Jyoti Structures Ltd.
JSPL (Jindal Steel Power Ltd)
Associated Transrail Strucrures Ltd
29

 RPG Transmission Ltd.

Tata Project
Ramji Power Construction
EMC (Electrical Manufacturing Company)
KPTL (Kalputra Power Transmission Ltd.)
Devang Electricals.

PERFORMANCE OF BHEL JAGDISHPUR FOR THE FINANCIAL

YEAR 2005-06
Total Turnover

Rs. 7846 lacs

Value Added

Rs. 2864 lacs

Profit Before Tax

Rs. 165 lacs

Net Current Assets (W.C.)

Rs. 4778 lacs

Net Block

Rs. 887 lacs

Capital Employed

Rs. 5665 lacs

30

TARGET OF BHEL JAGDISHPUR FOR THE FINANCIAL

YEAR 2006-07
Physical Target

11884 Tonnes

Financial Target

Rs. 8500 lacs

Profit

Rs. 605 lacs

PROCESS OF MANUFACTURING INSULATORS

The various manufacturing units through which the insulator passes before getting
converted into the finished product are as follows:
1) STORAGE: The different raw materials for manufacture of insulators are stored
in the identified bins. The raw materials that are required are:
a) calcined chaibasa clay
b) dolomite
c) manganese dioxide
d) chrome ore
e) calcite
f) talc
g) ellur clay
h) than clay
i) quartz for brown clay
j) quartz
k) feldspar
l) bikaner clay
m) pyrophyllite
n) felcite
o) sericite
p) japan ball clay
All these materials are used in different quantities for different type of
insulators that are manufactured and demanded by the customers.
2) SLIP HOUSE: The slip house performs the following operations:
31

a) WEIGHING: Different raw materials from the storage bins are collected and
weighed according to the percentage composition given by the E&D and
according to the ball mill capacity to be charged. Then the weighing card is
attached to the lot.
A sample data for preparation of suspension body slip in a 5 ton ball mill
for the first charge are as follows:
Quartz
Feldspar
Pyrophylite
Bikaner clay
Felcite
Pebbles

1053 kg
603 kg
653 kg
387 kg
201 kg
157 kg(due the presence of previously
charged pebbles in the ball mill)

B) RIVER-PEBBLE CHARGING: For initial charging of river pebble in the ball mill
after rolling large ,medium and small pebbles are collected as per standard samples and
weighted as per specification number(PPSL: 0100 R-2 )and pebbles are charged as per
the quantity specified.
C) PREPARATION OF FIRST CHARGE BODYSLIP: Weighed quantity of first charged
raw materials is charged into the ball mill by attaching a cone to its hole from the
charging hole on the platform. The pebbles are cleaned with water before charging and
then specified quantity of water is charged into the ball mill. Generally charging takes 1-2
hours and ball mill runs 14-16 hours.
D) PREPARATION OF SECOND CHARGE BODY SLIP: Weighed quantity of second
charge is charged into the ball mill with required quantity of water after preparation of
first charge body slip and the ball mill is run for specified time. Then the slip is
discharged into the mixing tank and is agitated continuously.
E) BLUNGING RETURN SLIP: Scrap and water returned by the process is charged into
the blunger in specified proportions to get required specific gravity of the slip. Then it is
blunged to achieve homogeneous slip.
F) PREPARATION OF CAKE: The slip from the initial tank is pumped into the press
using plunger pump and then adequate pressure is applied to turn it into a cake. Here the
slip house work is complete.
3) JIGGERING UNIT: The cake from the slip house is fed into the plungmill.
Plungmill makes dough of the cake and releases it in continuous cylindrical
moulds. These moulds are then made into required shapes by automatic jiggering
machines.

32

4) FINISHING UNIT: the article is placed on the rotating wheel and adequate layer
of mass is removed without affecting die formation. Then the articles are placed
on tunnel drier cars and the cars are led into the temperature dryings chambers.
5) GLAZING UNIT: the glazing unit carries out the following operations:
a) CMC solution preparation
b) Sanding glaze preparation
c) Brown glaze preparation
d) Glazing operation
e) Sanding operation
f) Stamping and loading
6) FIRING UNIT: the firing work is done in the kiln. It is a continuous process and
the kiln temperature and cycle is maintained according to the instructions of the
E&D. This is done to test and check the suitability of the product according to the
specifications mentioned during the whole process.
7) ASSEMBLY SECTION: the various operations performed during assembly are:
a) application of bituminous paint
b) preparation of cement mortar
c) assembly of insulators
8) TESTING SECTION: here the testing of the finished product is done before the
dispatch by the R&D of the company. This is usually done by taking any sample
from the lot and then testing it.
9) DISPATCH SECTION: after all the above processes are finished and the testing
is complete a green chit is marked which confirms that the product is not
defective and right for dispatch.

IT DEPARTMENT
The company also has an IT department which gives full technical support to all
equipments related to information technology. Now a day IT plays a big role in
transmitting information in any company. It is much more efficient and fast than the
conventional system. BHEL IT department sets a good example of it. Here we can see
the complete system through which company is interlinked as well as with EPD
Bangalore (A branch of BHEL).
They provide services to all the departments via LAN
(Local area network) and WAN (Wide area network).

33

A SHORT HISTORY OF INSULATOR

INTRODUCTION:
A transition of insulator can be seen in various types of pin insulator suspension long
road insulators etc. The history of electric power industry is more than 100 year and in
this line span the industry has performed the indispensable role of supply of energy to
various industry & is still developing at a transition of insulator can be seen in various
types of pin insulators and in this span conductor suspended from silk threads to insulate
them from ground.
SUSPENSION INSULATOR
Pin type insulators continued to be used for transmission of voltages up to 70 KV.
However, pin type insulators were already becoming too large to0 be used with
transmission voltages over 100 KV. And was quickly becoming impractical for large
voltages. This lead to the development of suspension insulator by Mr. Lock, owner of the
lock insulator mfg. Co, who produced the worlds first suspension insulator in 1903. This
isolator soon had its shape improved to become the Duncan insulator. This insulator had
the advantage that it could be copied for use with higher transmission voltages. In
Europe, the first suspension insulator was developed in 1908 by the Hermsdorf problem
fabric, These insulators had shaped which were an advanced over those of the pin type
insulator.
In 1907 the American E.M. Hewlett developed the insulator which is known as the interline, or fish-type insulator. These insulators soon came to be known as Hewlett insulators
and were widely used all over the world for many years. 1915 brought the development
of the J.D. insulators by the American company of Jeffery Dewitt. thickness,
thoroughness and no deterioration advocated by this insulator attracted the attention of
the electric power industry, but its advantage of heavy weight resulted in their
disappearance after 10 years.
Todays suspension insulators are an improvement of the Duncan type and use the
connecting method for insulator, which has developed around 1910 by the look co. this
developed into the cleaves type suspension insulator as we known it today. About the
some time, The Ohio Brass Co. developed the two type of suspension insulator. Many
improvements were later made on these two types of suspension insulator to provide the
standard form of suspension insulator in use today.
The tensile strength of the standard 250-mmsuspension insulator in 1921are so was at
level of 4000-5000 Kg . With an extremely poor annual deterioration rate of 0.75% later
improvements to the porcelain body and the introduction kilns and the improved design
of the porcelain part, the inner surface of the cape and the pin head part as well as content
improvement resulted in a gradual advance in quality and performance.
In 1850 the German company Siemens developed a porcelain pin type of insulator with a
single lair. The development of the first glass pi type of insulator followed in 1858.

34

The paths of development which shapes of insulators on opposites of the Atlantic took
were fairly different. The first insulator had increased thickness of porcelain for higher
voltage with diameter of porcelain been increased to make the leakage distance longer.
The range of increase leakage distance or resistance which was made possible by
increased diameter was very limited. It was at this stage that double lair pin type insulator
was developed in the USA. The surface of pin type insulator was often short -circuited
with atmospheric moistures and this led to the hasty development of oil pin insulators in
Europe. How ever, even the practical use of this concept was soon out moded by multi
lair pin type insulators.
The size of porcelain insulators become extremely large with high transmission voltage
and the production of large pieces of porcelain of was of by means simple. This brought
about the manufacture of lair pin type insulators in order to insulator transmission voltage
20KV. a transmission of 55KV was successful operated in the USA in 1902. The
transmission was first planned to use the triple lair pin type insulators, but as these were
found to be mechanically weak, quadruple, this resulted in there eventual adoption.
Consequently, when compared with the first such insulators, todays insulators are four
times as strong and have an annual deterioration rate of about 1/1000.

Long-Rod Is Insulators
The early suspension insulators had a high deterioration rate. One of the cause was the
expansion of the cement connecting the pin of the suspension insulators to the porcelain
cavity parts which resulted in an internal force tending to push the insulators open and the
corresponding increase in the tension stress in the porcelain, bringing about the eventual
destruction of the insulators stress this was regarded a fundamental structural problem in
both Germany & Switzerland, it was considered that any improvement on the
conventional structure would not amount to any complete eradication of the problem.
Therefore, a structure, which did not generate increased tension in the porcelain, even if
the cement expands, was study. The insulator which was forerunner of todays long road
insulators was developed in Switzerland by the Motors-Columbus Co. in 1917. At the
time, the use of cement filler was out of favor, so the structure had a metal fitting. Which
was mechanically consternated from the out side? This was later modified to the normal
metal cap connection. The insulators manufactured by Motor-Columbus Co. are called
motor insulators. Such insulators parts become sort when copra to the length of insulators
in its connect states. This is to say that for a comparison of motor insulator and
suspension insulators in case of same. This necessitated increasing length of porcelain in
portion of the motor insulators and consequence gave rise around. These insulators also
come to be made in fairly long and let to the development and manufacture of the long
stab isolator which could with stand 110 KV and a length of more than one meter. This
insulator was developed by the Hermsdorf-Schaumburg Co. in 1936 and was forerunner
of todays long rod insulators.

Apparatus Insulators
These are two main type of insulator for apparatus at sub stations. They are the hollow
porcelain used for the transformer bushings, and the subject insulators used for
supporting the bus lines.

35

36

In BHEL Jagdishpur generally orders for sale of product are referred from Bangalore
office. In Bangalore, BHEL has a full fledged marketing division which handles all the
issues related to marketing of jagdishpur insulator plant. After getting the orders several
steps are performed to get the order fulfilled in a proper manner. First the contract letter is
reviewed and the terms and conditions are carefully reviewed and inspected. There are
some points to be analyzed:
1 General terms and conditions and special terms and conditions.

37

2
3
4
5
6

Price quality and delivery schedule.

Technical specification
Price variation formula.
Guaranteed technical particulars
Dispatch instructions

After this the work order is issued to different departments by the marketing
department for the production and completion of the whole contract. These
include
1 Production planning and coordination
2 Finance department.
3 Engineering department
4 Quality control department
5 Material management departments

TENDER NOTIFICATION AND PURCHASE

ORDER
The work of marketing department commences when they fill a tender and the
purchase order is received by them. After receiving the purchase order the marketing
department works within the guidelines that are mentioned in the purchase order to
fulfill that particular order. Following are the general guidelines that are mentioned in
a purchase order-

DRAWING
Drawing specifications are given to the engineering department for preparation of
detailed drawings for further submission to the customers for approval. After approval
from the customer copies of the drawing are given to the engineering department,
quality department and to the production department for their reference and for
modification in the manufacturing, if suggested by the customer in the drawing.

TYPE TEST AND QUALITY PLAN

As per the specification of the contract, the type test is to be conducted either at
BHEL works or at third party laboratory. The type test reports for which the test have
already been carried out within 5 years earlier to the date of contract, the same are
submitted to the customer. The customer considers these tests as per the industry

38

terms and gives the approval. But if the customer insists for fresh type tests, the same
has to be performed.
Some customers like powergrid, UPCL, power-links etc requires the quality plan, and
the same is submitted to the party with consultation of quality department.

MANUFACTURING
After all the above steps manufacturing process starts according to the specification
and quality design.

GENERAL AND SPECIAL TERMS AND CONDITIONS

The sales contract is considered as having come into force from the date of
notification of award. The contractor whose supply contract is accepted is called
supplier. The scope of contract shall be the design and engineering, wherever
applicable, manufacture, inspection and testing before dispatch, packing and supply
on F.O.R. Destination basis of the material and equipments in accordance with the
enclosed technical specification and bill of material.
The qualities of porcelain items and line hardware to be supplied by
contractor may vary within +10% of the quantity ordered by the purchaser. This is
because of the possibility of slight variation in the ultimate yield of the manufacturing
process of these items.

CONTRACT PRICE
The price quoted is for delivery ex-contracts works/subcontracts works/port of entry
inclusive of packing and forwarding but exclusive of freight and transit insurance
charges. Quoted price also do not include sales tax, excise duty or local authorities
from time to time and all such levies shall be charged extra as prevailing on the data
of actual deliveries and borne by the purchaser at actual regardless of the contracted
delivery schedule and other terms and conditions of contract.
The purchaser, if registered under sales tax act should furnish to the contract with the
purchase order and the necessary forms in duplicate to get the benefit of concession in
the rate of sales tax. Otherwise, the sales tax have to be paid by the purchaser at the
non-confessional rates.

STATUTORY OBLIGATIONS
If the cost of performance of the contract is increased or reduced by reasons of
making, passing or promulgation of any law after the date of tender in India or
elsewhere or any other regulation or by law having the force of law, the amount of
such increase or reduction shall be added to or deducted from the contract price as the
case may be.
39

TEST AND INSPECTION

Type tests are not included in this offer. The materials are subjected to root line and
acceptance test as per relevant international standard and specification, by the
contractor which works before dispatch. The testing facilities available in the
contractors works are enclosed.
Having satisfied himself that the materials have successfully passed the routine and
acceptance test, the contractor shall dispatch the materials as per dispatch instructions
in the contract and shall furnish the test certificate along with dispatch documents for
purchasers reference and records.
It is also desired that the contractor shall be placed to offer the first lot for
inspection and witnessing of acceptance tests by purchasers representative contracts
works. For this inspection the contractor shall normally give the purchaser 2 weeks
written notice. The expenses of the purchasers representative will be borne by the
purchaser. In case the purchasers representative arrives on the notified inspection
date, he shall take up the inspection, witness the acceptance test, shall also sign the
test certificates after successful completion of the tests at the contractors works itself.
Then the lot will be deemed cleared for dispatch.
In case the purchasers representative does not make himself available at the
contractors works for inspection the contractor shall go ahead with the tests which
shall be deemed to have been carried out in presence of purchasers representative
and the lot shall be deemed cleared for dispatch.
The contractor shall however take full responsibility for actually carrying out the
routine and acceptance test successfully on these lots and for conformity of the
material to the agreed specification.

PACKING
Packing is done in accordance with the contractors standard practice. Any damage
due to bad/loose shunting, improper handling by the railways/road transporters in
transit or at the transshipment point is not the responsibility of the contractor.

DISPATCH
Final dispatch orders are issued by the purchaser along with the order. However if the
contractor faces difficulty in dispatch by the mode/route specified by the purchaser
the contractor will have the option to effect dispatch by an alternative mode/route
with the prior consent of the purchaser which is nay unduly withheld and the

40

contractor should be paid any difference in the freight arising due the change in the
dispatch route.

TRANSIT INSURANCE
Liabilities pass over to the purchaser immediately upon the dispatch of goods. The
contractor accepts no liability for storages in transit. Purchaser shall be furnished with
dispatch particulars soon after dispatch of equipments to enable the purchaser to
arrange transit insurance.
Any replacement/repairs if required due to damage during transit, is covered by a
separate new quotation and order.

DELIVERY
The contractor shall deliver the equipments within the period specified in the offer.
The commencement and completion of delivery, however, are subject to the following
conditions:
1) The purchaser making available the detailed dispatch instruction along with the
order.
2) The contractors foreign/indigenous supplier delivering the basis of raw materials
and components within the committed delivery periods.
3) The purchase effecting the payment, as stipulated in the offer.
4) Force majuro conditions.
In all cases where the contractor experience delay on either one or more
than one of the above accounts, the contractor should intimate the purchaser the cause
of the delay and the period lost during such occurrences. The deliveries specified in
the offer will automatically be extended by the period thus lost.
Delivery shall be made in one or several consignments and each dispatch
would constitute a sale.

PAYMENT TERMS:
There are four modes of payments:
1) 100% advance payments in case of private party.
2) Through letter of credit in case of private and government party.
41

3) 100% advance 90% balance after dispatch from PSUs.

4) 100% after dispatch in case of government agencies.
5) For export to foreign country advance payment of 100% amount.

PAYMENT IN CASE OF LETTER OF CFEDIT IS OPENED

Unless otherwise stated in the offer, 100% payment value of materials including taxes,
duties levies, will be realized by the contractor for each consignment dispatched against
an irrevocable divisible confirmed letter of credit at sight to be established by the
purchaser with contractors bankers at industrial estate, jagdispur, district sultanpur. The
letter of credit should be established by the purchaser at the time of issue of purchaser
order itself.
In case of payments terms agreed 100% payments against dispatch of
documents through purchasers bankers; the following shall also be implied:
1) Delay in retirement of the invoices of the contractor is considered as a breach of
the contract. Further, the purchaser shall pay there contractor interest charges at
18% for all payments which are due for more than 30 days from the date of
invoice.
2) In addition to levying the interest charges, the contractor shall reserve the right to
suspend the work and withhold the dispatches of the equipments/divert the
equipments elsewhere in the event of delay on the party of purchaser in effecting
prompt payments. In such cases the contractor shall also have the right to revise
his price and delivery for the undelivered portion of equipments, accessories and
services in the contract.
3) The contractors invoices should settle in full.
4) Full taxes, duties should be claimed in the invoice against dispatch.
5) In case purchaser desires the dispatch of equipment to private sights consigned to
the consignee or transportation by road, the payment for each consignment will be
collected against proforma invoice before dispatch.
6) All bank charges should be charged to the purchasers account.

MONETARY DEPOSITS/BANK GURANTEE

Unless otherwise specifically mentioned in the contractors offer, the contractor is not
bound to furnish the purchaser with any monitory or bank guarantee for purpose like
earnest money, security deposit, performance guarantee or any other purpose.

42

WARRANTY
1) The contractor warrants that the materials will be in accordance with specification
and free from defects in workmanship.
2) For va period of twelve months commencing immediately from the date of
collection but not later than 18 months from the date of dispatch of equipment
called WARRANTY PERIOD the contractor is liable to replace any defective
parts that may develop in the supplies of his own manufacture or those of his subcontractors under conditions provided by the contract and under proper use and
arising solely from faulty design, materials or workmanship provided that notice
of any such defects or failure to confirm the specification and satisfactory proof
that is promptly given by the purchaser to the contractor, in the warranty period.
3) The contractors obligations against the above clause are limited at contractors
option to repairing or replacing all transport charges from contractors side and
back.
4) The acceptance of the equipment by purchasers shall in no way relieve the
contractor for his obligation under this clause.
5) The provisions contained in this clause will not be applicable;
a) If the purchaser or user has not used the materials according to generally
approved practices.
b) If the purchaser has not notified the contractor in writing as soon as defect
occurred.
c) If the equipment is spoiled or becomes defective on account of prong
longed or improper storage at site or due to purchasers fault.
d) In case of formal wear and tear.
e) In case of lighting and improper design and maintenance of transmission
lines/sub station equipments, where the offered goods are used.
6) The remedy stated above is the exclusive remedy of the purchaser for a breach of
warranties by the contractor. There is no other warranties expressed or implied
other than title. The purchasers exclusive remedy and the contractors sole
obligation after acceptance of the equipment shall be those stated herein.

INVOICE
1) All descriptive literature, shipping specifications, drawings and particulars of
weights and dimensions submitted with sales contract are approximately unless
otherwise mentioned in the contractors tender. The description and illustrations
contained in the catalogs and other advertisements matter are intended nearly to
present a general idea of the equipment described herein and none if these shall
form part of the contract.
2) The contractor shall have the right to improve or modify the design if equipment
contacted during the tenure of contract without affecting the basic functional
requirements of the contract, without seeking purchasers approval.

43

DEMURRAGE:
In the event of or delay in retirement of the dispatch documents from the bank,
consequent upon which demurrage and wharf age charges are payable to the transport or
rail authorities, all such expenses shall be borne by the purchaser. In case the transporter
or rail NOT CLEAR ABT THE WRITE UP

SUSPENSION OF WORK/CANCELLATION
1) The purchaser shall pay to the contractor reasonable expenses incurred by the
contractor by reason of suspension of work caused by suspension or lack of
information from purchaser unless such default on the part of the contractor or
sub contractor.
2) The purchaser shall not unilaterally cancel the order once placed. In the event of
an order being cancelled the purchaser shall pay to the contractor the cancellation
charges to be advised by the contractor in the event of any cancellation under the
provision of this clause, the purchaser shall have no claim on the design and
materials lying ready with the contractor for the contract. These will remain
property of the contractor.
3) In no case shall the purchaser have the right to purchase from elsewhere,
equipments and services ordered on the contractor at the contractors risk and
cost.

PATENTS
The contractor shall indemnify the purchaser from any claim of infringement of left
patent or registered design(published at date of contract order)by the sale of any article or
material supplied by the contractor to the purchaser and against all cost and damages for
which the purchaser may become liable, in such action, provided always that this
indemnity shall not apply to any infringement which due to the contractor having
followed a design or instruction furnished or given by the purchaser or to the user of such
articles or materials in a manner or for a purpose or in a foreign country not specified by
or disclosed to the contractor, and provide also that this indemnity is conditional on the
purchaser given to the contractor earliest possible notice in writing and claim being
mad4e for such action threatened or brought against purchaser and on purchaser
permitting the contractor at his expenses to conduct any litigation that may ensure and all
negotiations for settlements of the claim. The purchaser on his part warrant that any
design or instruction furnished or given by the purchaser shall not be as such will cause
us to infringe any letter patent, registered design or trade mark in the execution of the
order.

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ARBITRATION
If at any time any question, dispute or difference whatsoever shall arise between the
purchaser and the contractor upon or in relation to or in connection with contract, either
party may forthwith give to the other notice in writing of the existence of such question,
dispute, or difference and the same shall be referred to the adjudication to arbitrators one
to be nominated by the purchaser and the other to be nominated by the contractor, or in
the case of said arbitrators in writing, before preceding with the reference and the award
of arbitrators or in the event of not agreeing of the empire appointed by them shall be
final and binding on the parties and the provisions of the Indian arbitration act 1940 and
the rules under any statutory modifications shall be deemed to apply and be incorporated
in this contract.
Under every and any such reference the cost of and incidental to the reference and award
respectively shall be in the discretion of the arbitrators or of the empire, as the case may
be, who may determine the amount thereof, or direct the same to be taxed as between
solicitor and client of as between party and party and shall direct by whom to whom and
in what manner the same to be borne and paid.
Work under the contract shall be continued by the contractor during the arbitration
proceedings unless the purchaser shall order suspension thereof in writing and if such
suspension shall be ordered the reasonable expenses of the contractor on account of such
suspension shall be added to the contract price and unless the decision of the arbitrators
or the empire, as the case may be is obtained and saved as those which are otherwise
expressly provided in the contract on payment or payable by the purchaser shall be
withheld on account of such arbitration proceedings unless it is the subject matter thereof.

CONTRACT AGGREMENT
The issue of the purchaser order by the purchaser, incorporation of the terms and
condition incorporated herein with alterations if any as may be mutually agreed to
between the purchaser and the contractor. For such order issued by the purchaser, the
contractor shall issue a formal acceptance letter on contractors letter-head.

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Like every manufacturing company, BHEL also has its own separate finance department
which deals with the different financial matters of the company. The finance department
of BHEL is sub-divided into various sections and the work flow is divided among these
sections which are consolidated and put together as a whole at the end and the final
accounts are prepared and then the decision making process begins and targets are set for

46

the next financial year. The various sections into which the finance department is divided
are:
1)
2)
3)
4)
5)
6)

suppliers bill section

pay-roll section
sales section
budget and book section
taxation section
works bill section

1. SUPPLIERS BILL SECTION

The suppliers bill section of the finance department further deals with following issues
of the company
1) TRANSPORT BILL: the transporters bill is first sent to this department and the
department makes a record of the bill and SRV is prepared by the department.
Then the payment is made according to the items that are agreed upon by the
parties. All the payments are made through DD or CHEQUE.
2) PSL (PRICE STORE LEDGER): the price store ledger deals with the inventory
related issues and for this purpose they use weighted average cost accounting
method as decided by the board of BHEL.
3) SUPPLIERS PAYMENT: all the suppliers payments are made by this
department. These are the payments to all those suppliers who act as ancillaries to
BHEL. When they supply the material, the copy of this supply is sent to the metal
department of the company and record is made of the materials supplied by the
party. After this one copy of this is sent to the suppliers bill section of the finance
department with mentioning the materials that have been accepted and the number
that have been rejected. Then the finance department pays to the supplier for the
quantities that have been accepted as per the conditions agreed upon by the
supplier and the company and final record is made.
4) CONTRACT LABOUR PAYMENT: BHEL has a lot of contract labourers
working in the company and all the dealings related to them are dealt with in this
particular section of the company. All the payments that are made to them are paid
here in cash in the presence of their particular heads to dispose any discrepancy
that may arise during the process.

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2. PAY-ROLL SECTION
The work of the pay roll section begins the moment a person is appointed by the
company and the letter of appointment is issued to the employee. The employee is given
unique number in which the first two numbers indicate the unit to which the employee
belongs. All the permanent employees are provided an electronic card and the temporary
employees are provided a punch card for the attendance purpose. Every employee while
entering the company swaps the card at entry gate and their entry and exit time is
recorded the machine at the gate which is then transferred to the IT department of the
company. The IT department prepares a record and sends it to the pay roll section of the
company. The pay roll section then collects these data and prepares their own record of
each and every employee of the company. After preparing their record they send this
record to the respective department heads for their approval as they also have a manual
record of the employees of their department. This is to dispose any discrepancy in the
matter. After the records are signed by the respective heads and sent back to the pay roll
section they prepare the attendance sheet of each employee along with other details.
While preparing the details of the employees they mention all the matters such as the PF,
loans that they have taken, LIC, income tax deducted, daily wage, DA etc and prepare the
whole amount after this. A copy of their statement is handed over to each employee with
all these details and the final salary which is being given to them after all these accounts
have been done. One most important point that BHEL keeps in mind is that every
employee who has a salary of above Rs 20000 is paid only through bank and not in cash.
All the other employees who have a salary below this are either paid in cash or through
bank as they desire.

3. SALES SECTION
This section deals with all the sales related issues in the company. It keeps all the records
and the data that is necessary while making the records and maintaining the account. It
keeps the record of all the debtors and creditors of the company and the central and state
sales tax that is levied on each item and the terms and conditions related to them. The
debtors management is also dealt with this department. They have to prepare an MIR
(manual information report) for every month which is sent to the corporate office every
month as a report of the company.

4. BOOKS AND BUDGET SECTION

This section keeps the records of all the matters of the finance department and all the
other records that each section keeps with it. They record all the ledgers and vouchers of
monthly, quarterly and yearly accounts. They also maintains records of the inter unit
transactions i.e. the transfers that takes place between this unit and BHELs other units.
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They keep the records of the entire audit that is done internally as well as the record of
the entire statutory and government audit.
This section also deals with the budgeting of the company. As the funds are allocated by
the corporate office for each BHEL unit. After receiving this budget they prepare their
own budget of each department with the respective heads and then allocate the funds to
each department for their purposes. They also prepare the budgeted figures and targets for
the company for the next financial year.

5. TAXATION SECTION
This section takes care of the tax related issues of the company. All the indirect and direct
taxes that they have to deal with is taken care of by this section. They also take care of
the excise duties and customs duty in case of export. They also have to deal with the
service tax related matters.

6. WORKS BILL SECTION

This section has to keep record of all the infrastructure related issues. They have to keep
the record of the building, roads, furniture and the township related matters. It keeps the
record of the work that is needed to be done for the company as well as for the township
and other areas.

CONCLUTION
First of all it was great and fulfilling experience working at BHEL Jagdishpur insulator
plant. The whole tenure of two months of our summer training helped us a lot to know
what it is working with a large organization like BHEL which is one of the top most
49

companies in India. We were able to learn and know the difference between theoretical
knowledge and practical experience. We learned that along with the theory we have to
apply our skills and expertise to solve the problems and situations that arise from time to
time.
The work here is divided in sections such as Marketing, Finance, Production, IT,
Assembly, R&D, Store, Slip etc. and each department is further divided in subsections
with the head of each section presiding over them. The marketing department works
through a few set guidelines those are there for the smooth functioning of the work flow.
No work in the department is carried out without a written letter signed by the concerned
authority and they put forward is that it proves to be a stronger evidence and record than
verbal communication.
Although, they also accept the point that this makes the work flow quite slow and
sometimes creates hurdles in the flow.
The finance department has a different procedure of working and their dealing
changes, when dealing with different parties. They have different times and condition
which are their regular customers whereas they are different for the customers dealing
with them for the first or the second times. They also have different payment terms which
changes with the type of work such as transporter bill, supplier bill etc. but no payment is
made or received in cash from or to any party.
The works in other departments also have more or less the same procedure. Most of
the machines and equipments that are used are from Japan. The safety measures and
proper working conditions are well taken care of in the plant for the employees working
in those conditions. All the workers working in the plant are provided with necessary
covers such as hand gloves, eye glasses etc wherever necessary. The R and D department
keeps a cheque of the quality of material that is produced and the standards that are to be
maintained. No material can be dispatched without their approval of the quality of the
product.
In all BHEL is a well organized company with high standards and earning huge
profits due to its highly professional functioning in its affairs. It was a pleasure working
at BHEL which gave us a bright opportunity to know the real industrial world and the
tactics of the trade to a great extent. Although a great amount of work needs to be done
on our part as this was only a small stint of the whole new world which we will face in
coming months.

SUGGESTIONS
The work flow at BHEL is quite smooth and organized. Each and every department is
further sub-divided in small sections and the work is divided among those sections with
the head of the department presiding over them. These heads then come together and
50

form the upper core of the organization, where the decision making and target setting
takes place. These heads prepare their own budgets and targets which are then combined
together to prepare the target of the whole organization. Along these there are some
points that need to be taken of:
In BHEL the dress code of all the employees is same no matter whether he is a
GM or an AGM. This is good on one point that it gives message of oneness but
the top level employees need to be given something that differentiate them from
the rest or indicates that they are the top level employees. For this purpose they
can ask their top executives to wear a tie which will take care of both the points
i.e. the oneness along with some extra respect to those employees.
The wooden boxes that they use for the storage and dispatch purpose of their
finished product is a matter of concern. The BHEL board should set a committee
or some personnel to find out an alternative to this problem as wood is not a long
term solution and can backfire at any time. They seriously need to look for a long
term replacement for this purpose as soon as possible.
The wastage that occurs once the insulators are tested defective is really a matter
of concern as they are just thrown at a place which can be well used for some
other purpose. The board needs to take some decision to solve this problem and
come out with a solution soon.
BHEL should at least have proper place for the employees where they can relax
during the lunch time as there is no such place in the company where they can sit
and rest during this time. The lunch break is of 40 minutes and it hardly takes 1520 minutes to finish the lunch and rest of the time they spent sitting here and
there, but if a proper place is provided to them they can sit and relax there which
can improve their efficiency to a great extent.
The facilities in their township can be improved a little although the facilities
provided are good, but one or two recreation parks and recreation clubs can be set
up which will help the young children in the township in their all round
development. The school that is in the township is already serving a great purpose
in this respect.

BIBLIOGRAPHY
BHEL Manual

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 www.google.com
wickipedia.com
BHEL Diary 2006
www.bhel.com

52