Chapter 4: Budget Estimates, Expenditure, Budget Control And Completion Reports PDF

Chapter 4: Budget Estimates, Expenditure, Budget Control and Completion Reports Section 1: Introduction - Budget Terms 4.1.1 Budget Estimates: Every Railway Administration has to prepare estimates of expenditure expected to be incurred by it in a y...

Chapter 4: Budget Estimates, Expenditure, Budget Control and Completion Reports Section 1: Introduction - Budget Terms 4.1.1 Budget Estimates: Every Railway Administration has to prepare estimates of expenditure expected to be incurred by it in a year and submit them on prescribed dates well in advance of the beginning of that year to the Railway Board for obtaining the sanction of the Parliament or the President. Such estimates are called "Budget Estimates". 4.1.2 Demand for Grants: On the basis of the Budget Estimates received from the various Railway Administrations and other spending units, the Railway Board prepare their "Demand for Grants" and present them to the Parliament or the President, as the case may be, for sanction. 4.1.3 Grants and Appropriations: The 'Demands for Grants' as finally approved by the Parliament are called the Budget 'Grants' and those sanctioned by the President without reference to the Parliament are called 'Appropriations'. 4.1.4 Budget Orders and Allotments (a) Railway Grants and Appropriations for a year are distributed by the Railway Board to the various Railway Administrations and other spending units directly under the Railway Board, through what are known as 'Budget Orders'. The Budget Orders are accompanied by the Budget Documents. (b) Grants and Appropriations distributed to the various Divisions and spending units are called Budget Allotments. 4.1.5 Budget Documents: The complete Budget, is printed in the form of books as under: (a) Demands for Grants. (b) Explanatory Memorandum showing the financial results of the year. (c) Works, Machinery and Rolling Stock Programme of Railways. 4.1.6 Re-appropriation: The transfer of funds originally assigned for expenditure on a specific object to supplement the funds sanctioned for another object is called "Re-appropriation". The powers of the Railway Board and Railway Administration in respect of re-appropriation are detailed in Chapter III of the Indian Railway Financial Code Volume I (extracts at Annexure: 4-A1). 4.1.7 Review of Expenditure: The sufficiency or otherwise of the sanctioned budget allotments shall be reviewed periodically by each Railway Administration on the basis of expenditure actually incurred upto the time of review and the anticipated expenditure during the remaining portion of the financial year. The detailed procedure in regard to review of Expenditure is contained in Chapter III of the Indian Railway Financial Code, Volume I (extracts at Annexure: 4-A2). Chapter 4: Budget Estimates, Expenditure, Budget Control and Completion Reports Page 59 of 530 4.1.8 Major, Minor, Sub, Detailed Heads: All revenue working expenses of the Railway are classified under 13 sub major heads with separate abstract for each sub major head. The sub major heads are divided into minor, sub and detailed heads as detailed in Volume II of the Indian Railway Financial Code (Minor, sub and detailed heads, relevant to Signaling and Telecommunication are at Annexure: 4-A3). 4.1.9 Revenue and Works Budgets: Budget estimates of the Signal and Telecommunication Department comprise mainly of the following: (a) Estimates of Working Expenses: These are based on the Working Expenses for the repairs and maintenance of Signaling, interlocking and Telecommunication Services and comprise estimates of expenditure against Demand Nos. 3,7 and 8 referred to in Para 4.1.8. (b) Works Budget: Open Line Works Budget otherwise known as 'Annual Works Programme' comprises estimates of requirements for Works against Demand No. 16. (c) Plant and Machinery Programme comprises estimates of requirements for Machinery and Plant against Demand No. 16. 4.1.10 Compilation: The Revenue Budget or Estimate of Working Expenses is compiled in the prescribed forms in the Headquarters Office on the basis of proposals submitted by the Divisions/Extra Divisional Units in accordance with instructions contained in Chapter III of the Indian Railway Financial Code. Volume I (extract at Annexure: 4-A4). 4.1.11 Detailed Instructions for Administering the Budget are contained in Chapter III of the Indian Railway Financial Code (extract at Annexure: 4-A7). Section 2: Works, Machinery and Rolling Stock Budget 4.2.1 Detailed Instructions for Preparation and Submission Detailed instructions for preparation and submission of Works, Machinery and Rolling Stock Budget are contained in Chapter III of Indian Railway Financial Code, Volume I (extracts at Annexure: 4-A5). The classification of expenditure by primary units of expenditure are contained in Volume II of the Financial Code (Heads relevant to Signal and Telecommunication Department at Annexure: 4-A6). 4.2.2 Compilation of Plant and Machinery Programme (a) The detailed instructions for the preparation and submission of the Plant and Machinery Programme are contained in Chapter XV of the Indian Railway Code for the Mechanical Department (Workshops). (b) The requirements of machinery in Signaling and Telecommunication Workshops shall be collected and shown in Plant and Machinery Programme. The description of machinery, number, allocation, cost etc. shall be shown on the prescribed forms and submitted along with the programme. This programme should be as per the schedule of Works Programme. Chapter 4: Budget Estimates, Expenditure, Budget Control and Completion Reports Page 60 of 530  Section 3: Maintenance of Accounts 4.3.1 Code Rules: Rules in regard to the maintenance of Open Line accounts are contained in Chapter XIV of the Indian Railway Code for the Engineering Department. 4.3.2 Accounting (a) The expenditure incurred is brought to account through various vouchers. Subject to such powers as may be delegated to him, the Divisional Signal and Telecommunication Engineer/Divisional Signal and Telecommunication Engineer incharge may incur expenditure on all ordinary maintenance works and establishments upto the limits of the provision in the Revenue Budget Estimates, sanctioned for his unit for the year. (b) All vouchers, such as debit notes for stores supplied, freight bills shall be carefully scrutinised before acceptance as to the reasonableness and propriety of the debits raised. Wherever necessary, such debits shall be correlated and checked with the initial records in the office, such as indents and work orders on Workshops and necessary endorsements made thereon. 4.3.3 Departmental Registers on Extra-Divisional Units (a) Revenue Allocation Register: The Deputy Signal and Telecommunication Engineer/ Divisional Signal and Telecommunication Engineer incharge of an Extra-Divisional Unit shall maintain a Register of Revenue expenditure, if any, incurred by him under the relevant grants in order to keep himself acquainted with the progress of expenditure in his unit as compared with the sanction in the Authorization Rolls. The detailed instructions in regard to the maintenance of Revenue Allocation Register are contained in Para 1469 of Engineering Code (Annexure: 4-A8). (b) Register of Works: The object of maintaining the Register of Works and Instructions in regard to maintenance of the same are contained in Paras 1472, 1473, 1474 and 1475 of Engineering Code (Annexure: 4-A9). (c) Reconciliation of Registers: The registers of the Extra-Divisional Office shall be sent monthly to the Accounts Office with a clerk on such dates as mutually agreed upon in order that the entries made therein may be reconciled with similar registers maintained in the Accounts Office. 4.3.4 Departmental Registers on Divisions: On Divisions where the initial accounts are maintained by the Accounts Department, neither Allocation Register nor Register of Works need be maintained by the Departmental Officers. There will be only one set of registers and these will be maintained by the Accounts Officer both for his own use and for that of the other Departmental Officers, who will continue to be responsible for the efficient control of expenditure against estimates and allotments. Chapter 4: Budget Estimates, Expenditure, Budget Control and Completion Reports Page 61 of 530  Section 4: Control over Expenditure 4.4.1 The manner in which the budgetary and expenditure control is to be exercised by the various units is indicated in Chapter V of the Indian Railway Financial Code (relevant extract at Annexure: 4-A10). 4.4.2 Indents and Work Orders When passing requisitions for materials and tools, for works or maintenance, Sr. Divisional Signal and Telecommunication Engineer/Deputy Signal and Telecommunication Engineer/Divisional Signal and Telecommunication Engineer incharge shall ensure that the amounts involved are within the allotments and also within provision in the sanctioned estimates. Before execution of agreements and work orders with contractors the Sr. Divisional Signal and Telecommunication Engineer/Deputy Signal and Telecommunication Engineer/Divisional Signal and Telecommunication Engineer incharge shall ensure that these have been carefully checked in every respect. Rates allowed in bills received from firms shall be carefully scrutinized before they are passed for payments. Section 5: Completion Reports 4.5.1 Code Rules: Rules in regard to the preparation and submission of Completion Reports are contained in Chapter XVII of the Indian Railway Code for the Engineering Department (relevant extracts at Annexure: 4-A11). Note: This Chapter has under mentioned Annexures S.No Annexure No. Description 1 4-A1 Powers of the Railway Board 2 4-A2 Review of Expenditure 3 4-A3 Revenue Expenditure 4 4-A4 Preparation of the Budget 5 4-A5 Works Machinery and Rolling Stock Budget 6 4-A6 Classification of Capital and other Works Expenditure 7 4-A7 Distribution of Funds by the Railway Board 8 4-A8 Revenue Allocation Registers 9 4-A9 Register of Works is a Collective Record of Expenditure Designed 10 4-A10 Revenue and Works Expenditure 11 4-A11 Completion Report Chapter 4: Budget Estimates, Expenditure, Budget Control and Completion Reports Page 62 of 530 Para No. 4.1.6 Annexure: 4-A1 Powers of the Railway Board (Extract of Chapter III of Indian Railways Financial Code, Volume I) (1) Powers of the Railway Board: Within the amount of a grant as voted by the Parliament, the Railway Board have full power of transferring the provision from one sub-head to another by a formal order of re-appropriation but re-appropriations, from one grant to another are not permissible. Under Grant No. 16 no re-appropriation of funds is permissible between Capital, Railway Funds and Revenue even though re-appropriation is permissible between the various sub-heads of grant viz., the various plan heads. As regards "Charged" expenditure there are no restrictions on the powers of the Railway Board to transfer provision from one sub-head to another by a formal order of re- appropriation but no re-appropriation is permissible from one grant to another from "Charged" heads to "Voted" heads or Vice Versa. (Para 376) (2) Powers of Railway Administrations: No re-appropriation is permissible between "Voted" and "Charged" allotments or between the allotments made under one grant and another. In the case of Grant No. 16 no re-appropriation is permissible between the Capital Railway funds and revenue. The re-appropriations. (Para 377) (a) to and from the provision for the following plan heads under Grant No. 16: (i) New Lines (Construction); (ii) Gauge Conversion; (iii) Electrification Projects; (iv) Track renewals; (v) Staff quarters } Staff Welfare Works. (vi) Amenities for staff } Staff Welfare Works. (vii) Passenger Amenities and other Railway Users' amenities. (b) to and from the provision for "Payments to other Railways" in Grant No. 9, and; (c) to and from the provision for "Suspense" in Grant No, 12 require the prior approval of the Railway Board. (3) The amount allotted to the Railway administrations under the Civil Grant for "Interest on debt and other obligations and reduction or avoidance of debt" is distributed under the following units of re-appropriations, viz., (a) State Provident Funds; (b) Railway Staff Benefit Fund; (c) Eastern Group Sleeper Control Provident Fund; (d) Indian Railways Conference Association Employee's Provident Fund; (e) Depreciation Reserve Fund, Railways; (f) Revenue Reserve Fund; (g) Railway Development Fund; (h) Accident Compensation, Safety and Passenger Amenities Fund, and (i) Pension Fund. No re-appropriation is permissible from one unit to another. Chapter 4: Budget Estimates, Expenditure, Budget Control and Completion Reports Page 63 of 530 (4) Other re-appropriations may be sanctioned by the Railway Administrations but no re- appropriations are permissible after the close of the financial year i. e., 31st March. The re-appropriations by Railway administrations should not be made haphazardly on the basis of individual items of expenditure where the original provision is exceeded, nor should they be postponed to be made only towards the end of the year. The Railway administration should review the position as a whole at intervals and carry out the necessary re-appropriations. When funds have to be provided for new expenditure under one of the sub-heads and the administrations are definitely in a position to transfer the grant from another sub-head for this purpose, the appropriations should be made promptly. The whole object is to ensure that, as far as possible, funds which are not required are withdrawn from disbursing officers as soon as it is definitely known that they are not required, and incidentally to provide that any really unavoidable expenditure is met from such savings as far as possible. (Para 379) (5) All proposals far re-appropriation of funds which are beyond the General Manager's powers shall be submitted to the Railway Board sufficiently early to admit of action being taken before the close of the financial year. (Para 380) Chapter 4: Budget Estimates, Expenditure, Budget Control and Completion Reports Page 64 of 530 Para No. 4.1.7 Annexure: 4-A2 Form No. F. 383 Review of Expenditure (Extract of Chapter III of Indian Railways Financial Code, Volume I) (1) Review of Expenditure: Railway Administrations should review their expenditure in August to see whether any modifications are necessary in the allotments placed at their disposal. The review in respect of each grant should be submitted to the Railway Board in Form No. F-383 so as to reach them not later than 1st September each year. (Para 383) Statement showing …………………………….. necessary in the allotments under Grant No. ……….…. during …………. (in thousands of rupees) Variations between Actuals last year Latest Estimate, Current Year Amount Columns (10 and 7) Brief Total Detailed Actuals Approxi advanced from reasons Total for Budget Columns 8 heads First Four Full first mates Full the Contingency Excess Savings for large first four Current and 9 months year three for year Fund (+) (-) variation month year month month 1 2 3 4 5 6 7 8 9 10 11 12 13 Detailed heads of the Grant Total… Chapter 4: Budget Estimates, Expenditure, Budget Control and Completion Reports Page 65 of 530 (2) The Administrations should review the position in as much detail as possible at the time, and if there is any new expenditure which was definitely not anticipated in the budget and which cannot be postponed without serious detriment to safety or efficiency, they should examine whether such expenditure can be met by saving in expenditure provided for in the budget, when such savings can be foreseen or can be achieved without serious damage. The review should show whether such examination discloses the necessity of additional grants or the possibilities of net savings, in order to enable the Board to set off savings on one railway against excesses on another and to arrive at one estimate of the net additional grant required if any. (Para 384) (3) Final Modification Statement: The Railway Board should be furnished, for each grant separately, so as to reach them not later than the 21st February each year, with statements showing the additional allotments required (both voted and charged) or surrenders to be made, during the cur rent financial year under each head of appropriation, as prescribed in the budget orders, and requiring the sanction of the President. The variations between the Final modified allotment required and the revised estimates as fixed by the Board should in all cases be supported by adequate explanations of the reasons for the demand or surrender. (Para 315) (4) The railways should, however, continue to review the budgetary position further on submission of the Final Modification statements and any modification that may be considered necessary as a result of new factors visualized and the further review of budgetary position should be advised telegraphically to the Board so as to reach them on the 1st of March or any other date in March which would be advised to the Railways by the Board. (Para 386) (5) Any important changes subsequently found necessary, should be intimated before the 20th March of the year, to enable President to accord sanction to them where possible, so that the Railway Administration may sanction in time, before the 31st March of the year, any re- appropriations to cover the anticipated excess over allotments. (Para 388) Note: Latest Proforma of above table shall followed. Chapter 4: Budget Estimates, Expenditure, Budget Control and Completion Reports Page 66 of 530 Para No. 4.1.8 Annexure: 4-A3 Revenue Expenditure (Extract of Indian Railways Financial Code, Volume II) S. Demand Main Heads Sub-Heads Abstract Name of Demand No No. No. Name No. Name 1 3 ‘A’ General 800 Signal and 810 Administration. Superintendance Telecommunicati 820 Signalling. and Services. on Management 830 Telecommunication 840 Workshop, Drawing and Estimating. 870 Miscellaneous Expenses. 890 Credits and Recoveries. 2 7 ‘E’ Repairs and 100 Establishment in 110 Officers and Office Maintenance offices Establishment (S&T) Plant and 120 Supervisory Staff and Equipment their Office Staff/S&T. 130 Contingent Expenses/S&T. 500 Plant and 510 Mechanical Signalling Equipment 520 Electrical Block (Signalling) Signalling 530 Electrical Power Signalling 540 Other Repairs and Maintenance. 550 Miscellaneous Expenses. 600 Plant and 610 Microwave Equipment Multichannel Radio (Tele- Relay System and communication) Wireless System. 620 Railway Telephone Exchange. 630 Line Communication System. 640 Other Expenses. Chapter 4 Budget Estimates, Expenditure, Budget Control and Completion Reports Page 67 of 530 S. Demand Main Heads Sub-Heads Abstract Name of Demand No No. No. Name No. Name 700 Rental to BSNL for 710 Circuits of Signalling Signalling and System. Telecommunicati 720 Line Wire. on Circuits. 730 Administrative Telephone. 700 Signalling and 740 V.F.T. Channel. Telecommunicati 730 Other Operating on. Expenses 3 8 ‘F’ Operating 500 Cost of Training 510 Other than Hindi, Expenses, Rolling Staff. Medical Health and Stock and Welfare. Equipment. 4 12 ‘K’ Miscellaneous 100 Appropriation to 160 Signal and Working Depreciation Telecommunication Expenses. Reserve Fund. Department. 5 14 ‘M’ Appropriation to 500 Appropriation to 510 Appropriation to Funds. Accident Accident Compensation, Compensation, Safety Safety and and Passenger Passenger Amenity Fund. Amenity Fund. Note: Sub heads are further divided into Detailed Heads. The expenditure is classified into primary Units (objects) of Expenditure. For further details, Revised Classification of accounts of expenditure and earnings may be referred to. Chapter 4 Budget Estimates, Expenditure, Budget Control and Completion Reports Page 68 of 530 Para No. 4.1.10 Annexure: 4-A4 Preparation of the Budget (Extract of Chapter III of Indian Railways Financial Code, Volume I) (1) For the preparation of the Budget by the Railway Board, the Railway Administrations and other authorities empowered to incur expenditure are required to submit to the Railway Board their revised estimates for the current year and budget estimates for the following year on the dates prescribed below: (Para 307) Revenue Demands 2 to 15........ 1st December. Works Demand 16................ 23rd December. The revised estimates are required in respect of the current year and Budget Estimates for the following year. (2) Responsibility for framing the Estimates: Preparation of the Revised and Budget Estimates should commence at the 'grass root level' i. e., Division, Workshop, Stores Depot, etc., as the case maybe. The entire responsibility for framing the estimates devolves upon the spending/earning authorities concerned, though the actual work of compilation and scrutiny would rest with the Financial Adviser and Chief Accounts Officer who would also draw the attention of the General Manager to matters of purely financial impart. (Para 309) (3) The estimates should be as accurate as possible and, to achieve this object, care should be taken to see that the data on which the forecast is based is adequate and reliable and that the conclusions arrived at from the data can be sustained by past experience and future expectations of likely events. (Para 310) (4) No stereotyped method of estimating will be helpful in forecasting accurately, unless the data on which the forecast is based is selected with due care and all the useful knowledge is brought to bear on the conclusion to be derived from the data. The manner in which the data required for the preparation of the estimate should be collected is, therefore, left to the General Managers, but the general principles on the basis of which the various estimates should be framed are described, wherever necessary, in the following paragraphs. (Para 311) (5) The Revised and Budget Estimates should be framed by the various concerned authorities separately for (i) Ordinary Working Expenses and (Para 312). (ii) Works Expenditure. (6) The estimates of expenditure in respect of each demand should be prepared in duplicate, the figure being given in thousands of rupees. In preparing their estimates the Railway Administrations should ensure that the figures of actual expenditure for the preceding year shown in the estimate agree with those reported to the Railway Board. The figures of actual expenditure for the current year should represent the latest data. (Para 325) Chapter 4 Budget Estimates, Expenditure, Budget Control and Completion Reports Page 69 of 530 (7) Explanation of variations: A brief narrative explanation should be given of the causes (with amounts involved in each case) of substantial differences between the figures adopted for the revised estimates of the current year and (i) the actual of the previous year, and (ii) budget allotment for the current year. Similar explanation should be given for differences between the figures of the budget estimate of the ensuing year and the revised estimate of the current year. Large variations which compensate each other should also be indicated. (Para 326) (8) The revised estimate for the current and the budget estimate for the next year should be fixed after taking into account the expenditure of the previous year and comparing the expenditure during the first seven months of the year with the corresponding period of the previous year. A full explanation of special features and any exceptional and abnormal adjustments (with amounts involved) included in each period of the pervious and current year as also in the next year, should be given in the explanatory note accompanying the estimates. The financial effect of variations on account of specific reasons should be clearly brought out under each Demand. (Para 327) (9) When the expenditure anticipated in the last five months of the year is disproportionate as compared with (i) the first seven months of the year or (ii) the corresponding period of the previous year, reasons for the disproportionate expenditure should be given in the revised estimate. Special and non-recurring items of expenditure in a year should show a corresponding saving in the following year. Likewise, when transfers are made from one demand to another due to changes in classification, the saving shown under one demand should agree with the excess shown under the other demand. Chapter 4 Budget Estimates, Expenditure, Budget Control and Completion Reports Page 70 of 530 Para No. 4.2.1 Annexure: 4-A5 Works Machinery and Rolling Stock Budget (Extract of Chapter III of Indian Railways Financial Code, Volume I) (1) Works Machinery and Rolling Stock Budget: The revised and budget estimates for expenditure on construction acquisition, and replacement of assets (briefly known as the Works Budget) are prepared in the form of the Works Machinery and Rolling Stock Programmes. The Works Programme is required to be prepared in accordance with the instructions embodied in Chapter VI of the Indian Railway Code for the Engineering Department. (Para 5.12 may be referred to) (Para 346). (2) There is one single Demand for Grant for Works Budget viz., Demand No. 16 − Assets Acquisition, Construction and Replacement; and expenditure whether met out of loan obtained from the general exchequer or internal resources of Railways viz, 'Revenue', the 'Depreciation Fund', the 'Development Fund' and 'Accident Compensation', Safety and Passenger Amenities Fund in the case of last named fund, expenditure on safety works and passenger amenities works only, is included in this Demand. Works Demand provides for booking of expenditure by − various plan heads; the list of Plan Heads is as follows: Code No. of Description of Plan Heads Plan Head 11 New Lines (construction) 12 Purchase of new Lines...... 14 Gauge conversion 15 Doubling 16 Traffic facilities – Yard remodeling and others 29 Road Safety Works 33 Signalling and Telecommunication Works 34 Taking over of line wires from BSNL Departments 35 Electrification projects...... 41 Machinery and plant 42 Workshops including production units...... 64 Other specified Works (OSW) 65 Training/HRD Chapter 4 Budget Estimates, Expenditure, Budget Control and Completion Reports Page 71 of 530  Para No. 4.2.1 Annexure: 4-A6 Classification of Capital and other Works Expenditure (Extract of Indian Railways Financial Code, Volume II) The sources of financing will be indicated in the beginning by the following alphabets: P – Capital. Q – DRF. S – DF RRSK V – SF… U – Revenue. The next 4 digits will represent the Main, Sub and Detailed Heads of Classification, as illustrated below: Classification of Capital and other Works Expenditure Sl. Name of Main Heads Sub-Heads Demand Abstract No. Demand No. Name No. Name 1..... Assets, 1100 New lines (Construction). 1170 Equipment Plant Acquisition, and machinery*. construction 1180 General Charges and other Establishment. ++ Works Expenditure 1400 Gauge Conversation. Same sub and detailed 1500 Doubling. classification as 1600 Traffic facilities Yard under no. 1100 Remodelling and others. with codified digits for the relevant plan Head. 3300 Signalling and Do. Telecommunication works. 3400 Taking over of line wires Do. from P. & T. Department. 3500 Electrification projects. Do. *(Detailed Heads No.1173, 1177 for S&T and 1179 for Motor Vehicles). ++ (Detailed Head 1187 for S&T). Chapter 4 Budget Estimates, Expenditure, Budget Control and Completion Reports Page 72 of 530 Para No. 4.1.11 Annexure: 4-A7 Distribution of Funds by the Railway Board (Extract of Chapter III of Indian Railways Financial Code, Volume I) (1) Distribution of Funds by the Railway Board: The Grants as voted by the Parliament and the appropriations for the charged expenditure as sanctioned by the President, are distributed by the Railway Board among the Railway Administrations and other authorities subordinate to them, as soon as possible, after the Budget is sanctioned. The sums so distributed are called "Allotments" and the orders by means of which the allotments are made are called "Budget Orders". The allotments made out of funds voted by the Parliament are shown as "Voted" and those fixed by President are shown as "Charged". (Para 361) (2) The Budget Orders are accompanied by the final issues of "Demands for Grants" and "Works, Machinery and Rolling Stock Programmes" containing the detailed distribution of the Budget allotment made to The Railway administrations for working expenses and Capital, Depreciation Reserve Fund, Development Fund, Open Line Works (Revenue) and Accident Compensation, Safety and Passenger Amenities Fund expenditure. The Budget allotment made to a Railway administration is intended to cover all charges, including the liabilities for past years to be paid during the year or to be adjusted in the accounts for it. It shall be operative until the close of the financial year. Under the “doctrine of lapse" any unspent balance shall lapse and shall not be available for utilization in the following year. (Para 362) (3) In the event of the Budget Orders of the Railway Board not being received before the commencement of the financial year, the Railway administrations are empowered to incur expenditure, pending the receipt of the Budget Order, on works which were in progress at the end of the previous financial year. All expenditure incurred under this rule must be treated as a charge, against the allotment eventually made for such works. (Para 363) (4) Distribution of Funds by General Managers to Lower Authorities: Subject to the other provisions of this Chapter or of any general or specific orders issued by the Railway Board, a General Manager is expected to take steps immediately to distribute the funds, placed at his disposal, to authorities subordinate to him in such manner as he may consider most suitable, provided that the total of the sums so allocated does not exceed that total of the grant placed at his disposal. In making this initial distribution, he may, at his discretion, keep a sum unallotted as a reserve for emergencies that may arise in future. He may also vary the initial distribution as necessity arises during the course of the year. In regard to "Carry over" works, the latest information as to the necessity and extent of funds required for such works should be obtained from the authorities concerned and taken into consideration in making the initial distribution. (Para 365) (5) No expenditure shall be incurred by an authority without the allotment of necessary funds. The authorities to whom the funds are allotted, shall be responsible to report at once to the next higher authority the probability of any lapses or excesses over the sums placed at their disposal. ln exceptional cases, where expenditure is authorized in anticipation of the allotment of funds, or in excess of the existing provision, the authorizatio should be followed, as soon as possible, by a formal allotment of funds to the extent required. (Para 367) Chapter 4 Budget Estimates, Expenditure, Budget Control and Completion Reports Page 73 of 530 (6) The expenditure on each work shall be limited to the sum allotted for it. If for exceptional reasons, expenditure in excess of Budget allotment has to be incurred and if the authority incurring the expenditure is either not in a position to find funds by re- appropriation or is not empowered to sanction a re-appropriation thereof, application for additional funds shall be made to the next higher authority slating how the expenditure is proposed to be met. In doing so, it should invariably be explained why the need for the expenditure was not foreseen in time for inclusion in the Budget and why the outlay cannot be postponed to the next financial year. In each case a copy of the order making the allotment or sanctioning a re-appropriation shall be sent to the Accounts Officer concerned by the authority issuing the order or sanctioning the re- appropriation. (Para 368) (7) Responsibility of Railway Administrations in case of Excesses of Lapses: The Railway administrations shall be responsible to ensure that no expenditure is incurred in excess of the Budget allotments made to them. Should it become apparent at any time that the grant for the year is likely to be exceeded from any cause whatsoever, the General Manager should report the position to the Railway Board and apply for additional funds. No liability may be incurred in one year against anticipated grants of a succeeding year except that advance commitments for procurement of stores for works may be made as provided in para 812-S to the extent authorised by the Railway Board from time-to-time. (Para 371) (8) It shall also be the duty of the administrations to see that the allotments made to them are fully expended, in so far as in consistent with economy and the prevention of large expenditure in the last months of the year for the sole purpose of avoiding lapses. They shall be responsible for ensuring that money which is not likely to be needed during the year is promptly surrendered so as to allow of its appropriation for other purposes. (Para 372) (9) Powers of Railway Administrations in regard to emergent and inevitable expenditure: Notwithstanding the provisions of paragraph 7 above, the commencement of works urgently necessary to safeguard life or property or to repair damage to the line caused by flood, accident, earthquake or other unforeseen contingency, so as to restore or maintain through communication may be authorised by the Executive Engineer, but he should at once submit a report through the usual channel to the authority competent to give administrative approval to the work and to allot the required funds. (Para 373) (10) Expenditure to meet a sudden increase in traffic or for ensuring the safe operation of traffic may be incurred with the personal sanction of the General Manager in anticipation of the allotment of necessary funds by the Railway Board provided that the Financial Adviser and Chief Accounts Officer concurs. This power cannot be delegated and can be exercised by the General Manager only where the expenditure is within his power of sanction. In all cases where this requires an allotment of additional funds, a report showing the expenditure involved and the additional funds required should be submitted to the Railway Board, as soon as possible. (Para 374) Chapter 4 Budget Estimates, Expenditure, Budget Control and Completion Reports Page 74 of 530 Para No. 4.3.3(a) Annexure: 4-A8 Revenue Allocation Registers (Extract of Indian Railways Engineering Code) The entries in the Revenue Allocation Registers maintained in the Accounts Office shall be sub-divided as under: Cash, Transfers, Stores. and sufficient space should be left after each head for the entries which normally come under it. Alternatively, separate registers may be maintained to record the expenditure in these three divisions, in which case a separate summary will have to be prepared to arrive at the total expenditure under the various heads of revenue classification. The sanctions by heads of accounts as given in the Authorization Rolls or the Distribution Statement of Budget allotment should be entered in red ink at the head of the several Abstracts so as to form a ready means of comparison and check with the outlay and to admit of this being done the grand total expenditure for each month will be deducted at the foot of the abstract form (Form E. 1469), the sanctioned amount and the balance thus arrived at will be carried forward in red ink from month to month. At the end of the month when the Registers have been totalled, the 'Cash' totals will be agreed with the debits to 'Demands Payable' in the Monthly Classified Abstract of Cash transactions and a journal slip will be prepared crediting 'Demands Payable' and debiting the various abstracts of the Revenue Accounts. (Para 1469) ALLOCATION REGISTER (Abstract ‘A’ to ‘H’ and ‘J’ to ‘N’) For the month of ………………………………. 20…………. Allotment for the year. 20 Detailed Heads of Particulars Voucher Sl. Accounts as per Grand Sl. of Total* Remarks No. No. Date Revenue Classifications Total No. Transactions and Demand Heads Rs. P. Rs. P. Rs. P. Rs. P. Rs. P. Total for the month …………………………………………. Add total to end of previous month ………………………… Total to end of the month …………………………………… __________________________________________________________________________ * In Column (5) under Total should be posted “Wages and Materials’’ or “Ordinary and special’’ According to the requirements of the rules. Note: The expenditure (Other than on surveys) under the major head 345-A/B Policy formulation direction, research and other Miscellaneous Organisations should be recorded in a separate register in accordance with the prescribed classification. Chapter 4 Budget Estimates, Expenditure, Budget Control and Completion Reports Page 75 of 530 Para No. 4.3.3(b) Annexure: 4-A9 Register of Works is a Collective Record of Expenditure Designed (Extract of Indian Railways Engineering Code) (1) Register of works is a collective record of expenditure designed: (i) for effecting control of expenditure on works with reference to estimates, by facilitating comparison between the expenditure incurred on each work and the detailed provision made in the estimate for work; (Para 1472) (ii) for effecting budgetary control, by facilitating a comparison between the budget allotment for the work and the actual expenditure to the end of the month; and (iii) to enable any material modification occurring being spotted. (2) Single set of works registers: Detailed Register of Works in form E-1473 given below should be kept for all sanctioned works including those chargeable to Revenue, 'New minor works', showing the amounts of estimates sanctioned. This register shall be maintained in the Accounts Office both for open line and construction organisation. (Para 1473) ………………….. RAILWAY Form E-1473 WORKS REGISTER Name of work…………………………………………………………………………… Authority………………………………………………………………………………… Capital………………………………………...Rs. Cash ……………………………..Rs. Depreciation Fund…………………….............Rs. Stores ……………………………Rs. Development Fund……………………………Rs. Total ……………………………..Rs. Accident compensation Passenger Amenities Fund…………………………………………………………………………… Open Line Works-revenue…………………………………………………………….…. Revenue…………………………………………………………………………………Rs Date of commencement…………………………………………………………………... Date of completion………………………………………………………………………. Budget Allotment for the year…………………………………………………..............Rs Original estimate No……………………………………………………………………… Revised Estimate No……………………………………………………………………… Chapter 4 Budget Estimates, Expenditure, Budget Control and Completion Reports Page 76 of 530  Annexure: 4-A9 (Contd.) Items of Estimate Heads of Accounts Value of Total charges Advance material payments No of Material received in Amount Amount Amount Amount Date Particulars Development for supply at site advance of Vouchers Capital DRF Revenue Cash Store total Fund of payment of materials contractor 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 (3) This register should show the amount of estimate sanctioned, the budget allotment and details of expenditure on each work by heads of accounts and in addition under sub-heads of estimates in case of track renewal works estimated to cost Rs. 3 lakhs and over and Rs. 1 Lakh over and in the case of other works. In this register sub-heads of estimate estimated, to cost less than Rs. 10,000 need not be separately detailed, but may be grouped together as may be found convenient. The Register may be arranged by detailed heads of classification (for works falling under the demand relating to creation and replacement of assets) separate folios being set apart for each work. At the close of every month the register of works should be totalled up and the monthly, yearly and 'up-to-date' totals for each work struck. The register of works should be preserved for a period of 10 years. (Para 1474) (4) In posting the Register of works in the case of works, the accounts of which are kept by sub-heads, the last column relating to each work will always show the 'total charges', the last column but one will show 'value of materials received in advance of payment to contractors', the last column but two will show the value of the 'materials-at-site' and the last column but three will show 'advance payment for supply of materials'. In case of works, the accounts of which are not kept by sub-heads, the value of 'materials-at-site' need not be separately shown but the value of materials received in advance of payment to contractor and advance payment for supply of materials, if any, should be shown in all cases. (Para 1475) Chapter 4 Budget Estimates, Expenditure, Budget Control and Completion Reports Page 77 of 530 Para No. 4.4.1 Annexure: 4-A10 Revenue and Works Expenditure (Extract of Chapter V of Indian Railways Financial Code) (1) Revenue and Works Expenditure: As all Railway expenditure, other than that 'charged' on the Consolidated Fund of India, is voted in the form of the Demands for Grants, the budgetary control is intended to ensure that expenditure is incurred for the purposes, and within the limits, as voted by Parliament. (Para 504) (2) The exercise of authority for incurrence of expenditure carries with it also the responsibility for control of expenditure within the authorised limits. Further, these powers are subject to provisions contained in the various Codes, rules and regulations and also observance of the standards of financial propriety. (Para 505) (3) Standards of financial propriety: In the exercise of their financial powers, the sanctioning authorities must pay due regard to the following principles: (Para 116) (i) The expenditure should not prima facie be more than the occasion demands, and that every Government servant should exercise the same vigilance in respect of expenditure incurred from public moneys as a person of ordinary prudence would exercise in respect of the expenditure of his own money. (ii) No authority should exercise its powers of sanctioning expenditure to pass an order which will be directly or indirectly to its own advantage. (iii) Public moneys should not be utilised for the benefit of a particular person or section of the community unless (a) the amount of expenditure involved is insignificant; or (b) a claim for the amount could be enforced in a court of law; or (c) the expenditure is in pursuance of a recognised policy or custom. (iv) The amount of allowances, such as travelling allowances, granted to meet expenditure of a particular type, should be so regulated that the allowances are not on the whole sources of profit to the recipients. (4) Revenue Expenditure: The revised and budget estimates of ordinary working expenses submitted by the General Manager to the Railway Board are based on detailed estimates of revenue expenditure obtained by him from the various heads of departments of the railway. On receipt of the allotment from the Railway Board, these detailed estimates may require modification consistent with the allotment sanctioned by the Railway Board or as may be deemed necessary by the General Manager. (Para 506) (5) Within the amounts of the allotments fixed by General Manager for the various spending authorities in charge of divisions and departments, such authorities have full power to sanction expenditure on revenue account during the year, subject to the condition that the specific sanction of the competent authority must be obtained separately to all items of expenditure on establishment and experimental or special temporary works where under rules or orders such sanction is necessary; in a case in which the General Manager has prescribed that detailed estimates should be prepared and administrative approval and technical sanction obtained before the incurrence of expenditure, the procedure laid down by the General Manager must be followed. (Para 508) Chapter 4 Budget Estimates, Expenditure, Budget Control and Completion Reports Page 78 of 530 (6) Revenue Allocation Registers: All revenue expenditure is to be recorded in registers, which are known as Revenue Allocation Registers, by the various heads of accounts. The object of these registers is to keep the heads of divisions, and departments informed of the progress of expenditure against the allotments placed at their disposal by the General Manager, which should be entered in red ink in the appropriate columns provided for in these registers, so as to form a ready means of comparsion and check with the outlay. (Para 512) (7) Monthly Financial Reviews: The monthly reviews show the expenditure to the end of the previous month, against the allotments placed at the disposal of the controlling authorities under each sub-head of the grant for which they are responsible. The review should be prepared in Form No. 513 and submitted to the controlling authorities every month, by such date as may be fixed in consultation with them. Form No.F.51 Proportionate Expenditure upto June Sub-heads Budget Actual Actual 2021 more (+) or less (%) Budget of grant Allotment expenditure expenditure allotment to and heads for to end of to end of As compared As compared end of June of account 2021-22 June 2021 June 2020 with column with column 2021 (3) (5) 1 2 3 4 5 6 7 Note: The periods have been shown in the Pro forma for the purpose of illustration only. (8) Expenditure on, acquisition construction and replacement of Railway assets: Separate allotments are placed at the disposal of Railway Administrations under each Grant for expenditure on works chargeable to Capital, Depreciation Reserve Fund, Development Fund, Accident Compensation, Safety and Passenger Amenities Fund, or Open Line Works Revenue. These allotments are made in lump sums and their distribution over the various sub-heads and over the works for which they are intended are spelt out in the "Works, Machinery and Rolling Stock Programmes" which are furnished to the Railways also with the Budget Orders sanctioning the allotments. These 'Programmes also show, in the case of works costing over Rs.50,005 each, the total estimated cost of each work, and the railway administrations are required to exercise a control over expenditure not only against the allotment sanctioned for the year for each works but also against its total estimated cost as shown in the Programmes'. In regard to works costing not more than Rs.30,000 each, a lumpsum is allotted to each Railway administration in the 'Programme', before any expenditure is incurred against the lumpsum allotment; the estimates of such works should be sanctioned by the General Manager or any lower authority empowered by him in this behalf. Thus the control of expenditure on railways is exercised through. Chapter 4 Budget Estimates, Expenditure, Budget Control and Completion Reports Page 79 of 530  (i) the preparation, in advance, of estimates of the expenditure to be incurred; (ii) the allotment of funds through Budget Grants for the year, on the basis of these estimates; and (iii) the continuous and concurrent review of the expenditure as incurred against the details of the estimates and against the sanctioned grants, so that revisions of estimates or re-appropriation of funds are arranged for at the earliest possible point of time. The procedure to be followed in Controlling expenditure against estimates is detailed in Chapter XIV and XII of the Indian Railway Code for the Engineering and Mechanical Departments, respectively. (Para 517) (9) Watch over Progress of Expenditures: From the moment expenditure or liability is incurred on works, a check a regular and frequent intervals should be made on its progress, both against estimates and against funds. The check should originate in the lowest executive unit, Viz., a division. (Para 520) Note: Estimates are prepared for New Minor Works costing over Rs. 5,000 each which are chargeable to "Open Line Works-Revenue". The provisions in paragraph (10) apply equally to such works. (10) The Works Registers (Form No. E. 1474) maintained in each division enable a running comparison to be made between (Para 521) (a) the expenditure incurred on each work and the detailed provision made in the estimate for the work, and (b) the budget allotment for the work and the actual expenditure to the end of the month. The executive officer should examine the works registers monthly or at more frequent intervals, and watch the progress of expenditure on each work, so that any tendency towards excess over sanctioned estimates may be investigated and curbed or fresh administrative and technical sanctions obtained in time to cover the anticipated excess. (11) Review of Expenditure: The Accounts Officer should prepare every month two reviews, one by sub-heads/Plan heads of the Grant and the other by individual works, and present them to the authorities concerned by such dates as may be fixed in consultation with them. (Para 524) (12) The review of expenditure chargeable to Capital, Depreciation Reserve Fund, Development Fund, Accident Compensation, Safety and Passenger Amenities Fund Open Line Works − Revenue by sub-heads/Plan Heads of the Grant should be prepared monthly by the Accounts Officer in Form No. F. 525. (Para 525) Chapter 4 Budget Estimates, Expenditure, Budget Control and Completion Reports Page 80 of 530  Form No.F.525 Review showing Progress of Expenditure chargeable to Capital, Depreciation Reserve Fund, Accident Compensation, Safety and passenger Amenities Fund and Open Line Works- Revenue to end of ……………… Department……………………………….. Office…………………………………… (Figures in thousands of rupees) Reasons for Percentage of variations Percentage Sub- expenditure between 1 Total of head/ Budget to allotment Col.10 & 1 Estimates Appropriate Expenditure to end expenditure of the and brief to Plan Allotment of June 2020 to allotment sanctioned corresponding remarks as head for the (Col.9/Col.2 during the period of last the rate of Grant year x 100) year year progress of No.16 expenditure Capital DRF DF DF RRSK Total 1 2 3 4 5 6 7 8 9 10 11 12 Date…………………… Signature: ……………………………………... Designation: ………………………............. The quarterly reviews for period ending June, September and December may be sent to the Board by 25th of the second following month to which the figures relate. The review for the period ending March, will be sent to the Board by 6th August, each year. Reasons for variations and brief remarks as to the rate of progress of expenditure to be indicated in Col. 12 of the Form, should be meaningful and should be recorded in consultation with the spending authorities. Chapter 4 Budget Estimates, Expenditure, Budget Control and Completion Reports Page 81 of 530 Para No. 4.5.1 Annexure: 4-A11 Completion Report (Extract of Chapter XVII of Indian Railways Engineering Code) (1) Completion Estimates: In the case of Railway Projects costing over rupees one crore, the Construction or Abstract Estimate should be closed at the end of one of the first three financial half years after the date of "opening" (as defined in para 2) as maybe convenient and a "completion estimate" prepared. The completion estimate is a "stock taking estimate" and all works not started on that date are excluded from the scope of the project and are to be dealt with separately. (Para 1701) (2) In the case of open line projects the date of "opening" should be held to be the date on which the projects fulfills he purpose for which it was sanctioned. (Para 1702) (3) Closing the Accounts of a Project: Those items of work which were in progress at the time of closing of Construction or Abstract should be got completed and the accounts of the project should be closed as soon as possible. Executive Engineers in-charge of project should therefore take prompt action to bring to account all charges and credits pertaining to the projects. They should before closing the accounts of a project, take steps to liquidate all outstanding liabilities, clear suspense balances, pay up all outstanding contractor's claims and dispose of all surplus stores and tools and plant returned from works. After all charges and credits relating to the project have been booked in the accounts of the project a Completion Report of the project should be prepared. (Para 1704) (4) Form of Completion Report: The Completion Report should be prepared in the following form and brief explanations should be furnished for (i) excess of not less than 10 per cent or Rs. 25,000 whichever is less over the estimated provision under each sub-work; (ii) saving of not less than 20 per cent or Rs. 1 lakh whichever is less, occurring under any sub-work. (Para 1706) Note: The Divisional Railway Manager/Deputy Chief Engineer concerned may be empowered by the General Manager to approve the completion reports of works within the General Manager's competence in the Works Registers if variations are within 5 per cent of the sanctioned estimate. Form No.E.1706 Completion Report for the work........ Particulars Amount of Difference (Heads of Estimate Actual Remarks and Account and (with reference Expenditure Explanations Description to authority for Excess Saving of works) sanction) Chapter 4 Budget Estimates, Expenditure, Budget Control and Completion Reports Page 82 of 530 (5) Completion of Works: In common with works costing over Rupees one crore, a work or scheme costing less than this amount should be considered as completed when it fulfills the purpose for which it, when sanctioned, was intended, and when there has been no expenditure thereon for three months thereafter. All outstanding debits and credits pertaining to a completed work should as a rule be adjusted in the account of the work within three months of the date of completion. The accounts of a completed work should be closed six months after the date of completion and a completion report of the work drawn. (Para 1708) (6) A completion report for works costing Rupees one crore and less should subject to the detailed instructions issued by the Railway Administration, be prepared in the same form as that for works costing over Rupees one crore. It should compare the actual expenditure incurred with the sanctioned amount and should give under each sub work brief explanations of all excesses and savings of over 5 per cent or Rs. 10,000 whichever is less. The authority sanctioning the estimate may prescribe any additional information to be submitted along with the completion report. (Para 1709) (7) A certificate to the effect that necessary addenda or corrigenda to the list of Buildings have been issued should be recorded on all completion reports for staff quarters and other buildings. A certificate to the effect that the necessary entries have been made in the siding registers and the register of deposit works should be recorded on all completion reports relating to assisted sidings and deposit works. (Para 1710) (8) A completion report duly verified by the Accounts Officer should ordinarily be submitted to the authority who accorded the administrative approval to the work for information or regularisation. In respect of structural and track renewal works costing over Rupees ten lakhs included in the sanctioned budget with the prior approval of the Railway Board, and works sanctioned out of turn with the administrative approval of The Railway Board being beyond the General Manager's power of sanction, the completion reports may be finally dealt with by General Managers except (a) when they involve an excess beyond the General Manager's powers of sanction or (b) when a material modification is involved. For works costing rupees one crore and less the completion report should be submitted within six months of the completion of work. In the case of works on which no expenditure is recorded for three consequtive months, the Accounts Officer should call for the completion reports. If the works are incomplete the executive officer should advise the Accounts Officer of the probable dates of completion and submission of the completion reports. Abnormal delay in the submission of reports by the executive officers should be brought to the notice of the Head of the Railway Administration by the Accounts Officer. (Para 1711) (9) Completion Reports of Unfinished Works: If for any reason a work on which expenditure has been incurred is stopped and if there is no reasonable prospect of completing it in near future, the account of the work should as in the case of a completed work, be closed and a completion report drawn and submitted to the authority which accorded the administrative approval to the work, for information. In the case of structural works, other than Track Renewal works, costing more than Rupees one crore each for which administrative approval of the Railway Board is obtained by the submission of separate Abstract Estimates notwithstanding their specific inclusion in the sanctioned budget, the completion reports in such cases should be submitted to the Railway Board, duly verified by the Financial Adviser and Chief Accounts Officer. (Para 1713) Chapter 4 Budget Estimates, Expenditure, Budget Control and Completion Reports Page 83 of 530 (10) Completion Statements: As a general rule, a completion report should be submitted in respect of each completed work. Neverthless, in the case of works, the expenditure on which is within the competence of the head of the railway to sanction, a formal completion report on the prescribed from need not be prepared. In such cases all the information required in the Completion Report form, the certificate of the Accounts, Officer and the sanction of the competent executive authority may be recorded in the register of works under the relevant accounts Completion Statements showing the following information being prepared and recorded under the orders of the competent executive authority, after verification by the Accounts Officer: (Para 1714) (i) Reference to estimate. (ii) Amount of sanctioned estimate. (iii) Actual expenditure as fina lly booked. (iv) Brief explanation of excess or saving. Note: The provisions of this paragraph do not apply to works, for which detailed estimates are not required to be prepared. (11) Expeditious closing of Accounts of Works: The account of a work costing rupees one crore and less should not be kept open beyond three months of the date of its completion. Efforts should be made to bring to account all liabilities and credits pertaining to the work by liquidating the former and realising the latter within that period. If a contractor's claim could not be finally settled within that period whatever the railway considers as legitimately due to the contractors should be adjusted by debit to the work and credit to "Deposit" and the account of the work finally closed. If the disposal of released materials is likely to delay the closing of the account of a work, credit should be afforded to the work on the basis of estimates by the Stores Department in consultation with the Engineer. (Para 1715) (12) Entry in the Register of Works: When a work is completed and its accounts closed, a double red ink line should be rated below the last entry in the Register of Works and a note made as under— (Para 1716) Works completed. Completion report submitted on............................................ Chapter 4 Budget Estimates, Expenditure, Budget Control and Completion Reports Page 84 of 530