General Financial Rules 2017 (Updated July 2024) PDF

GENERAL FINANCIAL RULES 2017 Updated up to 31.07.2024 1  Ch.-1 - INTRODUCTION Rule 1 Short Title and Commencement: These The term shall include a Head of rules may be called General Financial...

GENERAL FINANCIAL RULES 2017 Updated up to 31.07.2024 1  Ch.-1 - INTRODUCTION Rule 1 Short Title and Commencement: These The term shall include a Head of rules may be called General Financial Department and also an Rules, 2017 and they shall come into Administrator; force at once and shall be applicable to all Central Government (xi) “Department of the Government Ministries/Departments, attached and of India” means any of the subordinate bodies. The provisions Ministries, Departments, contained in GFRs are deemed to be Secretariats and Offices as notified applicable to Autonomous Bodies except from time to time and listed in the to the extent the bye-laws of an First Schedule to the Government of Autonomous Body provides for separate India (Allocation of Business Rules); Financial Rules which have been (xii) “Drawing and Disbursing approved by the Government. Officer” means a Head of Office Rule 2 Definition: In these rules, unless the and also any other Gazetted context otherwise requires- Officer so designated by a (i) “Accounts Officer” means the Department of the Central Head of an Office of Accounts or Government, a Head of the Head of a Pay and Accounts Department or an Administrator, Office set up under the scheme of to draw bills and make payments departmentalization of accounts; on behalf of the Central (ii) “Administrator” means Government. The term shall also Administrator of a Union include a Head of Department or Territory, by whatever name an Administrator where he designated; himself discharges such function; (iii) “Appropriation” means the (xiii) “Ministry of Finance” means assignment, to meet specified the Ministry of Finance of the expenditure, of funds included in Central Government; a primary unit of appropriation; (xiv) “Financial Year” means the (iv) “Audit Officer” means the Head year beginning on the 1st of April of an Office of Audit; and ending on the 31st of March (v) “Competent Authority” means, following; in respect of the power to be (xv) “Government” means the exercised under any of these Central Government; Rules, the President or such (xvi) “Government Account” means other authority to which the the account relating to the power is delegated by or under Consolidated Fund, the these Rules, Delegation of Contingency Fund and the Public Financial Power Rules or any Account; as defined in these other general or special orders rules; issued by the Government of (xvii) “Head of the Department’’ India; means an authority or person (vi) “Comptroller and Auditor (not below the rank of a Deputy General” means the Comptroller Secretary to the Government of and Auditor General of India; India), declared by the concerned (vii) “Consolidated Fund” means Department in the Government of the Consolidated Fund of India India as a Head of Department in referred to in Article 266 (1) of the relation to an identifiable Constitution; establishment or establishments (viii) “Constitution” means the to exercise the delegated Constitution of India; financial powers under these (ix) “Contingency Fund” means the Rules; Contingency Fund of India (xviii) “Head of Office” means (a) a established under the Gazetted Officer declared as Contingency Fund of India Act, such in the Delegation of 1950, in terms of Article 267 (1) of Financial Powers Rules and (b) the Constitution; any other authority declared as (x) “Controlling Officer” means an such under any general or officer entrusted by a Department special orders of the competent of the Central Government with authority; the responsibility of controlling (xix) “Local Body” means an the incurring of expenditure authority legally entitled or and/or the collection of revenue. specially empowered by 2  Government to administer a local life; fund; (xxxii) OPEX model: In the OPEX (xx) “Local Fund” means a local fund model, the Seller provides the as defined in Rule 652 of the goods, maintains it and also Treasury Rules; provides the consumables as (xxi) “Non-recurring expenditure” required and finally takes back means expenditure other than the goods after useful / recurring expenditure; contracted life. The expenditure (xxii) “President” means the is made by the Buyer in a President of India; staggered manner as per the (xxiii) “Primary unit of appropriation” terms and conditions of the means a primary unit of contract. appropriation referred to in Rule 8 of the Delegation of Financial Powers Rules; Rule 3 Interdepartmental consultations: (xxiv) “Public Account” means the When the subject of a case concerns Public Account of India referred more than one Department, no order shall to in Article 266 (2) of the be issued until all such Departments have Constitution; concurred, or, failing such concurrence, a (xxv) “Public Works” means civil/ decision has been taken by or under the electrical works including public authority of the Cabinet. In this regard it is buildings, public services, clarified that every case in which a transport infrastructure etc., both decision, if taken in one Department, is original and repair works and any likely to affect the transaction of business other project, including allotted to another Department, shall also infrastructure which is for the use be deemed to be a case which concerns of general public; more than one Department. (xxvi) “Re-appropriation” means the Rule 4 Departmental Regulations of financial transfer of funds from one character: All Departmental regulations, primary unit of appropriation to in so far as they embody orders or another such unit; instructions of a financial character or (xxvii) “Recurring expenditure” have important financial bearing, must means the expenditure which is invariably be made by, or with the incurred at periodical intervals for approval of the Ministry of Finance. the same purpose. Expenditures Rule 5 Removal of Doubts: Where a doubt other than recurring expenditure arises as to the interpretation of any of the are non-recurring expenditure; provisions of these Rules, the matter shall (xxviii) “Reserve Bank” means the be referred to the Ministry of Finance for Reserve Bank of India or any decision. office or agency of the Reserve Rule 6 Modifications: Bank of India and includes any (i) The systems and procedures Bank acting as the agent of the established by these Rules are Reserve Bank of India in subject to general or special accordance with the provisions of instructions/ orders, which the the Reserve Bank of India Act, Ministry of Finance may issue 1934 (Act II of 1934); from time to time. (xxix) “Subordinate authority” means (ii) The systems and procedures a Department of the Central established by these Rules may Government or any authority be modified by any other subordinate to the President; authority only with the express (xxx) “Treasury Rules” means the approval of the Ministry of Treasury Rules of the Central Finance. Government; (xxxi) CAPEX model: In the CAPEX Model, Capital expenditures is used by the buyer to straightway purchase goods followed by procurement of consumables, arranging comprehensive maintenance contract after warranty period and finally disposing the product after useful 3  Ch.-2 - GENERAL SYSTEM OF FINANCIAL MANAGEMENT Rule 7 All moneys received by or on behalf of the down in the regulations of the Government either as dues of Department responsible for the same. Government or for deposit, remittance or Rule 11 (2) In Departments in which officers are otherwise, shall be brought into required to receive moneys on behalf of Government Account without delay, in Government and issue receipts therefore accordance with such general or special in Form GAR-6 the departmental rules as may be issued under Articles 150 regulations should provide for the and 283 (1) of the Constitution. maintenance of a proper account of the Rule 8 (1) receipt and issue of the receipt books, the (i) Under Article 284 of the number of receipt books to be issued at a Constitution all moneys received time to each officer and a check with the by or deposited with any officer officer’s accounts of the used books employed in connection with the when returned. affairs of the Union in his capacity Rule 12 Amounts due to Government shall not be as such, other than revenues or left outstanding without sufficient public moneys raised or received reasons. Where such amounts appear to by Government, shall be paid into be irrecoverable, the orders of the the Public Account. competent authority shall be obtained for (ii) All moneys received by or their adjustment. deposited with the Supreme Rule 13 Unless specially authorized by any rule or Court of India or with any other order made by competent authority, no Court, other than a High Court, sums shall be credited as revenue by within a Union Territory, shall debit to a suspense head. The credit also be dealt with in accordance must follow and not precede actual with Clause (i) of sub-rule (1). realization. Rule 8 (2) The Head of Account to which such Rule 14 Subject to any general or special orders moneys shall be credited and the issued by a Department of the Central withdrawal of moneys therefrom shall be Government, an Administrator or a Head governed by the relevant provisions of of a Department responsible for the Government Accounting Rules 1990 and collection of revenue shall keep the the Central Government Account Finance Ministry fully informed of the (Receipts and Payments) Rules, 1983 or progress of collection of revenue under such other general or special orders as his control and of all important variations may be issued in this behalf. in such collections as compared with the Rule 9 It is the duty of the Department of the Budget Estimates. Central Government concerned to ensure Rule 15 (1) Rents of buildings and lands. When that the receipts and dues of the the maintenance of any rentable building Government are correctly and promptly is entrusted to a civil department, other assessed, collected and duly credited to than the Central Public Works the Consolidated Fund or Public Account Department, the Administrator or the as the case may be. Head of the Department concerned shall Rule 10 The Controlling Officer shall arrange to be responsible for the due recovery of the obtain from his subordinate officers rent thereof. monthly accounts and returns in suitable Rule 15 (2) The procedure for the assessment form claiming credit for the amounts paid and recovery of rent of any building hired into the treasury or bank as the case may out will be regulated generally by the be, or otherwise accounted for, and rules applicable to buildings under the compare them with the statements of direct charge of the Central Public Works credits furnished by the Accounts Officer Department. to see that the amounts reported as Rule 15 (3) The detailed rules and procedure, collected have been duly credited. regarding the demand and recovery of Accordingly, each Accounts Officer will rent of Government buildings and lands, send an extract from his accounts are contained in the departmental showing the amounts brought to credit in regulations of the departments in charge the accounts in each month to the of those buildings. Controlling Officer concerned. Rule 16 (1) Fines. Every authority having the Rule 11 (1) Detailed rules and procedure power to impose and/ or realize a fine regarding assessment, collection, shall ensure that the money is realized, allocation, remission and abandonment duly checked and deposited into a of revenue and other receipts shall be laid treasury or bank as the case may be. 4 Rule 16 (2) Every authority having the power to economy and see that all relevant refund fines shall ensure that the refunds financial rules and regulations are are checked and no double refunds of observed, by his own office and by amounts of fines collected or refunds of subordinate disbursing officers. Among fines not actually paid into a treasury or the principles on which emphasis is bank as the case may be, are made generally laid are the following:- Rule 17 Miscellaneous Demands. Accounts (i) Every officer is expected to Officers shall watch the realization of exercise the same vigilance in miscellaneous demands of Government, respect of expenditure incurred not falling under the ordinary revenue from public moneys as a person administration, such as contributions of ordinary prudence would from State Governments, Local Funds, exercise in respect of contractors and others towards expenditure of his own money. establishment charges. (ii) The expenditure should not be Rule 18 Remission of Revenue. A claim to prima facie more than the revenue shall not be remitted or occasion demands. abandoned save with the sanction of the (iii) No authority should exercise its competent authority. powers of sanctioning Rule 19 (1) Subject to any general or special expenditure to pass an order orders issued by the Government which will be directly or indirectly Departments of the Central Government, to its own advantage. Administrators and Heads of (iv) Expenditure from public moneys Departments, other than those in the should not be incurred for the Department of Posts, shall submit benefit of a particular person or a annually on the 1st of June to the Audit section of the people, unless – Officer and the Accounts Officer (a) a claim for the amount could concerned, statements showing the be enforced in a Court of remissions of revenue and abandonment Law, or of claims to revenue sanctioned during (b) the expenditure is in the preceding year by competent pursuance of a recognized authorities in exercise of the discretionary policy or custom. powers vested in them otherwise than by Rule 22 Expenditure from Public Funds. No law or rule having the force of law, authority may incur any expenditure or provided that individual remissions below enter into any liability involving Rupees one thousand need not be expenditure or transfer of moneys for included in the statements. investment or deposit from public funds Rule 19 (2)For inclusion in the statements (Consolidated Fund / Contingency Fund referred to in Rule 19 (1) above, and the Public Accounts) unless the remissions and abandonments should be same has been sanctioned by a classified broadly with reference to the competent authority. grounds on which they were sanctioned Rule 23 Delegation of Financial Powers. The and a total figure should be given for each financial powers of the Government have class. A brief explanation of the been delegated to various subordinate circumstances leading to the remission authorities vide Delegation of Financial should be added in the case of each Powers Rules as amended from time to class. time. The financial powers of the Rule20 Departments of the Central Government Government, which have not been and Administrators may make rules delegated to a subordinate authority, defining remissions and abandonments shall vest in the Finance Ministry. of revenue for the purpose of Rule 19 Rule 24 Consultation with Financial Advisers. above. All draft memoranda for Expenditure Finance Committee or Public Investment I. GENERAL PRINCIPLES RELATING TO Bureau or Committee on Establishment EXPENDITURE AND PAYMENT OF Expenditure and Cabinet Committee for MONEY Economic Affairs or Cabinet shall be circulated by the Ministry or Department Rule 21 Standards of financial propriety. Every concerned after consultation with the officer incurring or authorizing concerned Financial Adviser of the expenditure from public moneys should Ministry or Department. A confirmation to be guided by high standards of financial this effect shall be included in the draft propriety. Every officer should also memorandum at the circulation stage. enforce financial order and strict 5 Rule 25 (1) Provision of funds for sanction. All easement or privilege of such sanctions to the expenditure shall concessions, or indicate the details of the provisions in the relevant grant or appropriation wherefrom (ii) involves relinquishment of such expenditure is to be met. revenue in any way Rule 25 (2) All proposals for sanction to Rule 29 Procedure for communication of expenditure, shall indicate whether such sanctions. All financial sanctions and expenditure can be met by valid orders issued by a competent authority appropriation or re- appropriation. shall be communicated to the Audit Rule 25 (3) In cases where it becomes necessary Officer and the Accounts Officer. The to issue a sanction to expenditure before procedure to be followed for funds are communicated, the sanction communication of financial sanctions and should specify that such expenditure is orders will be as under:- subjected to funds being communicated (i) All financial sanctions issued by a in the budget of the year. Department of the Central Rule 26 Responsibility of Controlling Officer in Government which relate to a respect of Budget allocation. The matter concerning the duties and responsibilities of a controlling Department proper and on the officer in respect of funds placed at his basis of which payment is to be disposal are to ensure: made or authorized by the (i) that the expenditure does not Accounts Officer, should be exceed the budget allocation. addressed to him. (ii) that the expenditure is incurred (ii) All other sanctions should be for the purpose for which funds accorded in the form of an Order, have been provided. which need not be addressed to (iii) that the expenditure is incurred in any authority, but a copy thereof public interest. should be endorsed to the (iv) that adequate control mechanism Accounts Officer concerned. is functioning in his Department (iii) In the case of non-recurring for prevention, detection of errors expenditure, the sanctioning and irregularities in the financial authority may, where required, proceedings of his subordinate accord sanction by signing or offices and to guard against countersigning the bill or waste and loss of public money, voucher, whether before or after Rule 27 (1) Date of effect of sanction. Subject to the money is drawn, instead of by fulfillment of the provisions as contained a separate sanction.1 in the Delegation of Financial Powers (iv) All financial sanctions and orders Rules, all rules, sanctions or orders shall issued by a Department of the come into force from the date of issue Central Government with the unless any other date from which they concurrence of the Internal shall come into force is specified therein. Finance Wing or Finance Rule 27 (2) Date of creation to be indicated in Ministry, as applicable, should be sanctions for temporary posts. Orders communicated to the Accounts sanctioning the creation of a temporary Officer in accordance with the post should, in addition to the sanctioned procedure laid down in the duration, invariably specify the date from Delegation of Financial Powers which it is to be created Rules, and orders issued Rule 28 Powers in regard to certain special thereunder from time to time. matters. Except in pursuance of the (v) All financial sanctions and orders general delegation made by, or with the issued by a Department with the approval of the President, a subordinate concurrence of the Ministry of authority shall not, without the previous Home Affairs or Comptroller and consent of the Finance Ministry, issue an Auditor General of India or order which- Department of Personnel should (i) involves any grant of land, or specify that the sanction or assignment of revenue, or orders are issued with the concession, grant, lease or concurrence of that Department licence of mineral or forest rights, along with the number and date or rights to water, power or any of relevant communication of that 1 Amended vide Department of Expenditure (DoE), Ministry of Finance (MoF) OM No. 14(37)/2015-E.II.A dated 12.07.2024. 6  Department wherein the should be endorsed to the Audit concurrence was conveyed. Officers:- (vi) All orders conveying sanctions to (a) Sanctions relating to grant to expenditure of a definite amount advances to Central or upto a specific limit should Government employees. express both in words and (b) Sanctions relating to figures the amount of appointment or promotion or expenditure sanctioned. transfer of Gazetted and (vii) Sanctions accorded by a Head of non- Gazetted Officers. Department may be (c) All sanctions relating to communicated to the Accounts creation or continuation or Officer by an authorized abolition of posts. Gazetted Officer of his Office (d) Sanctions for handing over duly signed by him for the Head charge and taking over of Department or conveyed in the charge, etc. name of the Head of the (e) Sanctions relating to Department. payment or withdrawal of (viii) All orders conveying sanctions to General Provident Fund the grant of additions to pay such advances to Government as Special Allowance, Personal servants. Pay, etc., should contain a brief (f) Sanctions of contingent summary of the reasons for the expenditure incurred under grant of such additions to pay so the powers of Head of as to enable the Accounts Officer Offices. to see that it is correctly termed (g) Other sanctions of routine as Special Allowance, Personal nature issued by Heads of Pay, etc., as the case may be. Subordinate Officers (other (ix) Orders issued by a Department than those issued by of a Union Territory Government Ministries or Departments where Audit and Accounts (a) proper and under powers of have not been separated shall be a Head of Department). communicated direct to the Audit (xii) Sanctions accorded by authority; (b) have been competent authority to grants of separated, copies shall be land and alienation of land endorsed to the Audit authorities. revenue, other than those in In case of sanctions in respect of which assignments of land matters, where reference was revenue are treated as cash made to the Central Government payment, shall be communicated under the Rules of Business to the Audit and/ or the Accounts framed under Section 46 of the Officer, as the case may be, in a Government of Union Territory consolidated monthly return Act, 1963, the following clause giving the necessary details. shall be added in the sanction Rule 30 Lapse of Sanctions. A sanction for any endorsed to Audit:- fresh charge shall, unless it is specifically “A reference had been made in renewed, lapse if no payment in whole or this case to the Central in part has been made during a period of Government and the above twelve months from the date of issue of order/letter conforms to the such sanction. Provided that - decision of the Central (i) when the period of currency of Government vide Government of the sanction is prescribed in the India, Ministry/Department of departmental regulations or is Letter No…………dated… ”. specified in the sanction itself, it (x) Copies of all General Financial shall lapse on the expiry of such Orders issued by a Department periods; or of the Central Government with (ii) when there is a specific provision the concurrence of the in a sanction that the expenditure Comptroller and Auditor General would be met from the Budget of India shall be supplied to the provision of a specified financial Comptroller and Auditor General year, it shall lapse at the close of of India. that financial year; or (xi) Copies of all sanctions or orders (iii) in the case of purchase of stores, other than the following types a sanction shall not lapse, if 7  tenders have been accepted (in (c) refunds allowed on the the case of local or direct ground that the claims were purchase of stores) or the indent time-barred: has been placed (in the case of (ii) Petty losses of value not Central Purchases) on the exceeding Rupees ten thousand. Central Purchase Organization Rule 33 (2) Cases involving serious irregularities within the period of one year of shall be brought to the notice of Financial the date of issue of that sanction, Adviser or Chief Accounting Authority of even if the actual payment in the Ministry or Department concerned whole or in part has not been and the Controller General of Accounts, made during the said period. Ministry of Finance. Rule 31 Notwithstanding anything contained in Rule 33 (3) Report of loss contemplated in sub- Rule 30, a sanction in respect of an rule (1) & (2) shall be made at two addition to a permanent establishment, stages:- made from year to year under a general (i) An initial report should be made scheme by a competent authority, or in as soon as a suspicion arises respect of an allowance sanctioned for a that a loss has taken place. post or for a class of Government (ii) The final report should be sent to servants, but not drawn by the officer(s) authorities indicated in sub rule concerned, shall not lapse. (1) & (2) after investigation Rule32 Remission of disallowances by Audit indicating nature and extent of and writing off of overpayment made loss, errors or neglect of rules by to Government servants. The remission which the loss has been caused of disallowances by Audit and writing off and the prospects of recovery. of overpayments made to Government Rule 33 (4) The complete report contemplated in servants by competent authorities shall sub- rule 3, shall reach through proper be in accordance with the provisions of channels to the Head of the Department, the Delegation of Financial Powers who shall finally dispose of the same Rules, and instructions issued under the powers delegated to him under thereunder. the Delegation of Financial Power Rules. The reports, which he cannot finally II. DEFALCATION AND LOSSES dispose of under the delegated powers, shall be submitted to the Finance Rule 33 (1) Report of Losses. Any loss or Ministry. shortage of public moneys, departmental Rule 33 (5) An amount lost through revenue or receipts, stamps, opium, misappropriation, defalcation, stores or other property held by, or on embezzlement, etc., may be redrawn on behalf of, Government irrespective of the a simple receipt pending investigation, cause of loss and manner of detection, recovery or write-off with the approval of shall be immediately reported by the the authority competent to write-off the subordinate authority concerned to the loss in question. next higher authority as well as to the Rule 33 (6) In cases of loss to Government on Statutory Audit Officer and to the account of culpability of Government concerned Principal Accounts Officer, servants, the loss should be borne by the even when such loss has been made Central Government Department or State good by the party responsible for it. Government concerned with the However, the following losses need not transaction. Similarly, if any recoveries be reported: are made from the erring Government (i) Cases involving losses of officials in cash, the receipt will be revenue due to credited to the Central Government (a) mistakes in assessments Department or the State Government which are discovered too who sustained the loss. late to permit a Rule 33 (7) All cases involving loss of supplementary claim being Government money arising from made, erroneous or irregular issue of cheques (b) under assessments which or irregular accounting of receipts will be are due to interpretation of reported to the Controller General of the law by the local authority Accounts along with the circumstances being overruled by higher leading to the loss, so that he can take authority after the expiry of steps to remedy defects in rules or the time-limit prescribed procedures, if any, connected therewith. under the law, and 8 Rule 34 Loss of Government Property due to should be completed promptly with fire, theft, fraud. Departmental Officers special attention to action against shall, in addition to taking action as delinquents and remedial measures, prescribed in Rule 33, follow the taken to strengthen the control system provisions indicated below in cases involving material loss or destruction of III. SUBMISSION OF RECORDS AND Government property as a result of fire, INFORMATION theft, fraud, etc. All losses above the value of Rupees Fifty Rule 39 Demand for information by Audit or thousand due to suspected fire, theft, Accounts Officer. A subordinate fraud, etc., shall be invariably reported to authority shall afford all reasonable the Police for investigation as early as facilities to the Audit Officer and Pay and possible. Accounts Officer for the discharge of his Once the matter is reported to the Police functions, and furnish fullest possible Authorities, all concerned should assist information required by him for the the Police in their investigation. A formal preparation of any official account or investigation report should be obtained report, payments and internal audit. from the Police Authorities in all cases, Rule 40 A subordinate authority shall not withhold which are referred to them. any information, books or other Rule 35 Loss of immovable property by fire, documents required by the Audit Officer flood etc. All loss of immovable property or Accounts Officer. exceeding Rupees fifty thousand, such Rule 41 If the contents of any file are categorized as buildings, communications, or other as ‘Secret’ or ‘Top Secret’ the file maybe works, caused by fire, flood, cyclone, sent personally to the Head of the Audit earthquake or any other natural cause, Office specifying this fact, who will then shall be reported at once by the deal with it in accordance with the subordinate authority concerned to standing instructions for handling and Government through the usual channel. custody of such classified documents. All other losses should be immediately brought to the notice of the next higher authority. Rule 36 Report to Audit and Accounts Officers. After a full enquiry as to the cause and the extent of the loss has been made, the detailed report should be sent by the subordinate authority concerned to Government through the proper channel; a copy of the report or an abstract thereof being simultaneously forwarded to the Audit officer and Pay and Accounts Officer. Rule 37 Responsibility of losses. An officer shall be held personally responsible for any loss sustained by the Government through fraud or negligence on his part. He will also be held personally responsible for any loss arising from fraud or negligence of any other officer to the extent to which it may be shown that he contributed to the loss by his own action or negligence. The Departmental proceedings for assessment of responsibility for the loss shall be conducted according to the instructions contained in Appendix 1 and those issued by the Ministry of Personnel from time to time. Rule 38 Prompt disposal of cases of loss. Action at each stage of detection, reporting, write off, final disposal, in cases of losses including action against delinquents and remedial measures 9  Ch.-3 - BUDGET FORMULATION AND IMPLEMENTATION Rule 42 Financial Year. Financial year of the item wise break-up of all major items of Government shall commence on the 1st tax and non-tax revenues are clearly day of April of each year and end on the identified and depicted in the receipt 31st day of March of the following year. estimates. This is required to highlight all Rule 43 (1) Presentation of Budget to individual items of significance. Any Parliament. major variation in estimates with In accordance with the provisions of reference to past actuals or/and Budget Article112 (1) of the Constitution, the Estimates shall be supported by cogent Finance Minister shall arrange to lay reasons. The accounting heads under before both the Houses of Parliament, an which major tax and non-tax revenues Annual Financial Statement also known are collected shall be prescribed by the as the ‘Budget’ showing the estimated administrative Ministry in consultation receipts and expenditure of the Central with the Budget Division in the Finance Government in respect of a financial year, Ministry. before the commencement of that year. Rule46 Non-Tax Revenues. While the tax Rule43 (2) The receipts and expenditure of the revenues, non- debt capital receipts Railways being a departmental including disinvestments and borrowings commercial organization form part of the are managed by the various Departments Government’s receipts and expenditure of the Ministry of Finance, the non-tax and are included in the Annual Financial revenues are collected through all Statement. With the merger of Railway Ministries/Departments and other Budget with the General Budget, the autonomous bodies and implementing Demands for Grants and the Statement agencies and comprise an important of Budget Estimates of Railways shall source of revenue for the Government. also be part of the General Budget with Rule 47 User Charges. ‘User Charges’ is an effect from 2017-18. important component of the non-tax Rule 43 (3) The provisions for preparation, revenues. Each Ministry/Department may formulation and submission of budget to undertake an exercise to identify the ‘user the Parliament are contained in Articles charges’ levied by it and publish the same 112 to 116 of the Constitution of India. on its website. Rule43 (4) The Ministry of Finance, Budget (i) While fixing the rates of user Division, shall issue guidelines for charges, the preparation of budget estimates from Ministries/Departments must time to time. All the ensure that the user charges Ministries/Departments shall comply in recover the current cost of full with these guidelines. providing services with Rule44 The budget shall contain the following: - reasonable return on capital (i) Estimates of all revenues investment. expected to be raised during the (ii) Any deviation from these financial year to which the budget principles shall be specifically relates; recorded with reasons justifying (ii) Estimates of all expenditure for the setting of user charges lower each programme, scheme and than the cost recovery norms, if project in that financial year; any. (iii) Estimates of all interest and debt (iii) The rates of user charges should servicing charges and any be linked with appropriate price repayments on loans in that indices and reviewed at least financial year; every three years. (iv) Any other information as may be (iv) In order to enable ease of prescribed. revision of user charges, the rate Rule 45 Receipt Estimates. The detailed of user charges shall be fixed, estimates of receipts shall be prepared by wherever possible through Rules the estimating authorities separately for or executive orders and not each Major Head of Account in the through a statute. prescribed form. For each Major Head, Rule 48 Dividends and Profits. Dividends and the estimating authority shall give the profits including the transfer of surplus break-up of the Minor/Subhead/ Detailed from Reserve Bank of India is a major wise estimate along with actuals of the component of the non-tax revenues. The past three years. While doing the head payment of dividends/profits etc. by the wise classification, it may be ensured that Central Public Sector Enterprises shall 10  not be delayed and must be paid within Demand for Grants. an appropriate time frame immediately Rule 51 (2) Generally, one Demand for Grant is after the decision on dividend is taken in presented in respect of each Ministry or the AGM. Ministries or Departments shall Department. However, in respect of large monitor timely payments of dividends and Ministries or Departments, more than one profits. The dividend shall be payable as Demand may be presented. Each per the guidelines issued by DIPAM in Demand normally includes provisions this regard. required for a service, i.e. provisions on Rule 49 Receipts Portal. The Government has account of revenue expenditure, capital provided a public portal for online expenditure, grants to the State and collection of various non-tax revenues Union Territory Governments and also including various fees and user charges Loans and Advances relating to the through e- Receipts. All service. Ministries/Departments, shall take Rule 51 (3) The Demand for Grants shall be prompt measures for migration to e- presented to Parliament at two levels. Receipts, to ensure customer The main Demand for Grants shall be convenience and immediate credit of presented to Parliament by the Ministry of receipts to the Government account. Finance, Budget Division along with the Rule 50 (1) Expenditure estimates. The Annual Financial Statement while the expenditure estimates shall show Detailed Demands for Grants, for separately the sums required to meet the consideration by the “Departmentally expenditure Charged on the Related Standing Committee” (DRSC) of Consolidated Fund under Article 112 (3) the Parliament, are laid on the Table of of the Constitution and sums required to the Lok Sabha by the concerned meet other expenditure for which a vote Ministries/ Departments, as per dates of the Lok Sabha is required under Article approved from time to time. 113(2) of the Constitution. Rule 52 (1) Form of Annual Financial Rule 50 (2) The estimates shall also distinguish Statement and Demands for Grant. provisions for expenditure on revenue The form of the Annual Financial account from capital account, including Statement and Demands for Grants shall on loans by the Government and for be laid down by the Finance Ministry and repayment of loans, treasury bills, cash no alteration of arrangement or management bills and ways and means classification shall be made without the advances. approval of that Ministry. Rule 50 (3) The detailed estimates of expenditure Rule 52 (2) The heads under which provision for shall be prepared by the estimating expenditure shall be made in the authorities up to the final unit of Demands for Grants or Appropriation appropriation (Object head) under the shall be prescribed by the Finance prescribed Major and Minor Heads of Ministry in consultation with the Accounts for both Revenue and Capital Administrative Ministry or Department. expenditure. Estimates shall include The authorized heads for expenditure in suitable provision for liabilities of the a year shall be as shown in the Detailed previous years that is to be discharged Demands for Grants passed by during the year. Parliament and no change shall be made Rule50 (4) The estimates of scheme related and therein without the formal approval of the other expenditures shall be processed in Finance Ministry. consultation with the Budget Division, Rule 52 (3) The major head wise provisions in the Ministry of Finance in accordance with Detailed Demands for Grants shall match the instructions issued by it. with the provision made in the Demands Rule 50 (5) The Revised and Budget Estimates of for Grants presented by Budget Division, both Revenue and Capital expenditure as the appropriations are sought on the after being scrutinized by the Financial basis of Demands for Grants. Advisers and approved by the Secretary NOTE: Detailed instructions for of the Administrative Ministry or preparation of the budget are available in Department concerned shall be Appendix 2, 3 and 4. forwarded to the Budget Division in the Rule 53 (1) Acceptance and inclusion of Ministry of Finance in such manner and estimates. The estimates of receipts and forms as may be prescribed by it from expenditure of each Ministry/Department time to time. shall be scrutinized in the Budget Division Rule 51 (1) Demands for Grants. The estimates of the Ministry of Finance. Secretary for expenditure for which vote of Lok (Expenditure) may hold meetings with Sabha is required shall be in the form of Secretaries or Financial Advisers of 11  Administrative Ministries or Departments Departments which, in turn, shall to discuss the totality of the requirements distribute the same to their subordinate of funds for various programmes and formations. The distribution so made schemes, along with receipts of the shall also be communicated to the Ministries or Departments. respective Pay and Accounts Officers Rule 53 (2) The estimates initially submitted by who shall exercise check against the the Departments may undergo some allocation to each subordinate authority. changes as a result of scrutiny in the Budget Division, Ministry of Finance and II. CONTROL OF EXPENDITURE deliberations in the pre-budget meetings AGAINST BUDGET between the Secretary (Expenditure) and the Secretary or Financial Adviser of the Rule 57 (1) Responsibility for control of Department concerned. The final Expenditure. The Departments of the estimates arrived at on the basis of Central Government shall be responsible scrutiny and pre-budget meetings shall for the control of expenditure against the be incorporated in the Budget sanctioned grants and appropriations documents. placed at their disposal. The control shall Rule 54 Outcome Budget. After finalization of be exercised through the Heads of the estimates for budgetary allocations, Departments and other Controlling the Department of Expenditure in Officers, if any, and Disbursing Officers consultation with NITI Aayog and the subordinate to them. concerned Ministries shall prepare an Rule 57 (2) A Grant or Appropriation can be Outcome Budget statement linking utilised only to cover the charges outlays against each scheme/project with (including liabilities, if any, of the past the outputs/deliverables and medium- year) which are to be paid during the term outcomes. The outputs/deliverables financial year of the Grant or shall be mandatorily given in Appropriation and adjusted in the account measurable/quantitative terms on the of the year. No charges against a Grant basis of parameters and deliverables or Appropriation can be authorized after decided in advance, on the basis of the expiry of the financial year. projections made in the Medium-Term Rule 57 (3) No expenditure shall be incurred Expenditure Framework (MTEF) which may have the effect of exceeding Statement. Allocations for each the total grant or appropriation authorized scheme/project shall be against a firm set by Parliament by law for a financial year, of deliverables which shall be adhered to. except after obtaining a supplementary The performance against specified grant or appropriation or an advance from outcomes would form the basis of the Contingency Fund. Since voted and deciding on the continuation of the charged portions as also the revenue and scheme and the quantum of budget capital sections of a Grant/Appropriation allocation. are distinct and re-appropriation inter se Rule 55 Vote on Account. If the Appropriation is not permissible, an excess in any one Bill seeking authorization of the portion or section is treated as an excess Parliament to make expenditure in in the Grant/Appropriation. consonance with the Budget proposal is Rule57(4) To have effective control over expenditure likely to be passed after the start of the by the Departments, Controlling and financial year to which it corresponds Disbursing Officers subordinate to them then pending the completion of the shall follow the procedure as given procedure prescribed in Article 113 of the below:- Constitution for the passing of the (i) For drawl of money the Drawing Budget, the Finance Ministry may need to and Disbursing Officer shall (a) obtain a ‘Vote on Account’ to cover Prepare and present bills for expenditure for a brief period in “charged” and “voted” accordance with the provisions of Article expenditure separately. (b) Enter 116 of the Constitution. Funds made on each bill the complete available under Vote on Account are not accounts classifications from to be utilized for expenditure on a ‘New major head down to the object Service’. head of account. When a single Rule 56 Communication and distribution of bill includes charges falling under grants and appropriations. After the two or more object heads, the Appropriation Bill relating to Budget is charges shall be distributed passed, the Ministry of Finance shall accurately over the respective communicate the same to the Ministries / heads. (c) Enter on each bill the 12  progressive total of expenditure GFR 7, in which he shall up-to-date under the primary unit incorporate – of appropriation to which the bill (a) the totals of the figures relates, including the amount of supplied by Disbursing the bill on which the entry is Officers; made. (b) the totals taken from his own (ii) All drawing and disbursing registers in Form GFR 5; officers shall maintain separate (c) the totals of such registers in Form GFR 5, adjustments under the physically or electronically for various detailed heads as allocation under each minor or communicated to him by the sub-head of account with which Accounts Officer on account they are concerned. of transfer entries and (iii) On the third day of each month, a expenditure debited to the copy of the entries made in this grant as a result of register during the preceding settlement of inward month shall be sent by the officer account claims and not maintaining it, to the Head of the reckoned by his DDOs. Department or other designated (vii) If any adjustment communicated Controlling Officer. This by the Accounts Officer affects statement shall also include the appropriation at the disposal adjustment of an inward claim, of a subordinate Disbursing etc., communicated by Pay and Officer, the fact that the Accounts Officer directly to the adjustment has been made shall DDO (and not to his Grant be communicated by the Controlling Officer). If there are Controlling Officer to the no entries in the register in any Disbursing Officer concerned. month, a ‘nil’ statement shall be (viii) On receipt of all the necessary sent. returns, the Head of the (iv) The Controlling Officer will Department shall prepare a maintain a broadsheet in Form consolidated account in Form GFR 6 to monitor the receipt of GFR 8, showing the complete the return prescribed in the expenditure from the grant or foregoing sub- clause appropriation at his disposal upto (v) On receipt of the returns from the end of the preceding month. Disbursing Officers, the Rule 57 (5) The Head of the Department and the Controlling Officer shall examine Accounts Officer shall be jointly them and satisfy himself: responsible for the monthly reconciliation (a) that the accounts of the figures given in the accounts classification has been maintained by the Head of the properly given; Department with those appearing in the (b) that progressive Accounts Officer’s books. The procedure expenditure has been for reconciliation shall be as follows: - properly noted and the (i) DDOs shall maintain a Bill available balances worked Register in Form TR 28-A, and out correctly; note all bills presented for (c) that expenditure up-to-date payment to the PAO in the is within the grant or register. As soon as cheques for appropriation; and the bills presented for payment (d) that the returns have been are received, and/or status of e- signed by Disbursing payments are verified from the Officers. Where the reports available with DDO on Controlling Officer finds PFMS portal these shall be noted defects in any of these in the appropriate column of the respects, he shall take steps Bill Register and the DDOs shall to rectify the defect. ensure that the amounts of (vi) When all the returns from the cheques tally with the net amount Disbursing Officers for a of the bills presented. In case any particular month have been retrenchment is made by the received and found to be in order, PAO, a note of such the Controlling Officer shall retrenchments shall be kept compile a statement in Form against the bill in the remarks 13  column in TR 28-A. Principal Accounts Officer (ii) The PAOs shall furnish to each of certifying the correctness of the the DDOs including Cheque – figures for the quarter by the 15th drawing DDOs, an extract from of the second following month the expenditure control register after the end of quarters April- or from the Compilation Sheet June, July-September, October- every month indicating the December and January- March. expenditure relating to grants Rule 57 (6) The Departments of the Central controlled by him classified under Government shall obtain from their the various major-minor detailed Heads of Departments and other offices head of accounts. The under them the departmental figures of statements for May to March expenditure in Form GFR 8 by the 15th of shall also contain Progressive the month following the month to which Figures. the returns relate. The figures relating to (iii) On receipt of these extracts from Revenue and Capital expenditure shall the PAOs, the DDOs shall tally be separately shown in these returns. the figures received, excluding The information so obtained shall be book adjustments, with the posted in register(s) kept for watching the expenditure worked out for the flow of expenditure against the month in the GFR 5 register. sanctioned grant or appropriation. Discrepancies, if any, between Progressive totals of expenditure shall be the two sets of figures shall be worked out for the purpose. If the promptly investigated by the departmental figures obtained in Form DDO in consultation with the GFR 8 and posted in the register(s), PAO. He shall also note in the require correction in a subsequent month, GFR 5 register particulars of Heads of Departments or other offices book adjustments advised by the shall make such corrections by making PAO through the monthly plus or minus entries in the progressive statement. Thereafter, the DDO totals. In case the Accounts Office figures shall furnish to the PAO a which subsequently become available certificate of agreement of the are found to be higher than departmental figures as per his books with figures, the former shall be assumed to those indicated by the PAOs by be the correct figures, as appropriation the last day of the month accounts are prepared on the basis of the following the month of accounts. figures booked in the accounts. (iv) The Principal Accounts Officer Rule 57 (7) The Departments of Central (or PAO wherever payments, Government shall also obtain from the relating to a grant are handled Heads of Departments and other wholly by a PAO) of each authorities under them, statements Ministry, shall send a monthly showing the details of the physical statement showing the progress of the schemes for which they expenditure vis-à-vis the Budget are responsible. This statement shall provision under the various show the name of the scheme, the heads of accounts, in the Budget provision for each scheme, the prescribed pro forma, to the progressive expenditure on each Heads of Departments scheme, the progress of the scheme in responsible for overall control of physical terms and the detailed reasons expenditure against grant of the for any shortfalls or excess, both against Ministry as a whole. The figures physical and financial targets. so communicated by the Rule 57 (8) A Broadsheet in Form GFR 9 shall be Principal Accounts Officer (or the maintained by the Departments of PAO concerned) shall be Central Government or each Head of compared by the Heads of Department and other authorities directly Departments with those under them, to watch the prompt receipt consolidated in Form GFR 8 and of the various returns mentioned above differences, if any, shall be taken from month to month and to take up by the Heads of Departments necessary measures for rectifying any with the Principal Accounts defaults noticed. Officers (or the PAO concerned) Rule 58 Maintenance of Liability Register for for reconciliation. The Head of effecting proper control over the Department shall furnish a expenditure. In order to maintain proper quarterly certificate to the control over expenditure, a Controlling 14  Officer shall obtain from the spending financial year. authorities liability statements in Form Rule 62 (2) The savings as well as provisions that GFR 3- A every month, starting from the cannot be profitably utilised shall be month of October in each financial year. surrendered to Government immediately, The Controlling Officer shall also they are foreseen without waiting till the maintain a Liability Register in Form GFR end of the year. No savings shall be held 3. in reserve for possible future excesses. Rule 59 Personal attention of the Head of Rule 62 (3) Rush of expenditure, particularly in Department /Controlling Officer the closing months of the Financial Year, required to estimate savings or shall be regarded as a breach of financial excesses. A Head of Department or propriety and shall be avoided. The Controlling Officer shall be in a position to Financial Advisers of the estimate the likelihood of savings or Ministries/Departments shall ensure excesses every month and to regularize adherence to the stipulated Monthly them in accordance with the instructions Expenditure Plan and the guidelines laid down in Rule 62. issued in this regard by the Budget Rule 60 Control of expenditure against Division, Department of Economic grant/appropriation and ultimate Affairs, from time to time. responsibility of the authority Rule 62 (4) The Financial Advisers of the administering it. The Accounts Officer Ministries/ Departments shall ensure shall report to the Head of the adherence to the stipulated Quarterly Department concerned immediately on Expenditure Plan and the guidelines the first appearance of any issued in this regard by Ministry of disproportionate expenditure, particularly Finance from time to time. in respect of recurring items of Rule 63 Expenditure on New Service. No expenditure under any grant or expenditure shall be incurred during a appropriation or a primary unit of financial year on a “New Service” not appropriation thereof. However, the contemplated in the Annual Budget for authority administering a grant/ the year except after obtaining a appropriation is ultimately responsible for supplementary grant or appropriation or the control of expenditure against the an advance from the Contingency Fund grant/appropriation and not the Accounts during that year. The guidelines to Officer. determine cases of “New Service”/ “New Rule 61 Excess Expenditure. Instrument of Service” are contained in 1. The Accounts Officer shall not Annexure-1 to Appendix -3. allow any payment against Rule 64 (1) Additional Allotment for excess sanctions in excess of the Budget expenditure. A subordinate authority provisions unless there is specific incurring the expenditure shall be approval of the Chief Accounting responsible for seeing that the allotment Authority. placed at its disposal is not exceeded. 2. The Financial Advisers and Chief Where any excess over the allotment is Accounting Authority, before apprehended, the subordinate authority according concurrence for shall obtain additional allotment before excess under any Head, shall incurring the excess expenditure. For this ensure availability of funds purpose, the authorities incurring through Re-appropriation/ expenditure shall maintain a ‘Liability Supplementary Demands for Register’ in Form GFR 3. Grants. (Refer Appendix 10) Rule 64 (2) A Disbursing Officer may not, on his Rule 62 (1) Surrender of savings. Departments own authority, authorize any payment in of the Central Government shall excess of the funds placed at his surrender to the Finance Ministry, by the disposal. If the Disbursing Officer is dates prescribed by that Ministry before called upon to honour a claim, which is the close of the financial year, all the certain to produce an excess over the anticipated savings noticed in the Grants allotment or appropriation at his disposal, or Appropriations controlled by them. The he shall take the orders of the Finance Ministry shall communicate the administrative authority to which he is acceptance of such surrenders as are subordinate before authorizing payment accepted by it to the Accounts Officer, of the claim in question. The before the close of the year. The funds administrative authority shall then provided during the financial year and not arrange to provide funds either by re- utilized before the close of that financial appropriation or by obtaining a year shall stand lapsed at the close of the Supplementary Grant or Appropriation or 15  an advance from the Contingency Fund. sufficient time for the voting of the Instructions contained in Note below Supplementary Demand and the passing Appendix 10 may also be kept in view. of the connected appropriation bill before Rule 65 (1) Re-appropriation of Funds. Subject close of the financial year, an advance to the provisions of Rule 10 of the from the Contingency Fund set up under Delegation of Financial Powers Rules, Article 267(1) of the Constitution shall be and also subject to such other general or obtained before incurring the specific restrictions as may be imposed expenditure. by the Finance Ministry in this behalf, re- Rule 67 (2) An advance from the Contingency appropriation of funds from one primary Fund shall also be obtained to meet unit of appropriation to another such unit expenditure in excess of the provisions within a grant or appropriation, may be for the service included in an sanctioned by a competent authority at Appropriation (Vote on Account) Act. any time before the close of the financial Rule 67 (3) The application for an advance from year to which such grant or appropriation the Contingency Fund shall indicate inter relates. The Primary unit in this regard alia the particulars of the additional shall be the final unit of appropriation i.e. expenditure involved and the sanction to the Object head of account. the advance has also to indicate the sub- Rule 65 (2) Re-appropriation of funds shall be head and the primary unit of the Grant to made only when it is known or anticipated which the expenditure appropriately that the appropriation for the unit from relates. In case, however, any difficulty is which funds are to be transferred shall felt, the matter shall be referred to the not be utilized in full or that savings can Finance Ministry for clarification. be effected in the appropriation for the Rule 67 (4) The procedure for obtaining an said unit. advance from the Contingency Fund and Rule 65 (3) Funds shall not be re-appropriated recoupment of the Fund shall be as laid from a unit with the intention of restoring down in the Contingency Fund of India the diverted appropriation to that unit (Amendment) Rules, 2021 as amended when savings become available under from time to time. For ready reference, other units later in the year. rules have been placed at Appendix - 6 to Rule 65 (4) An application for re-appropriation of this volume. funds shall ordinarily be supported by a [Note: The Contingency Fund of India statement in Form GFR 1 or any other (Amendment) Rules, 2021 were special form authorized by departmental published in Extraordinary Gazette of regulations showing how the excess is India vide No. G.S.R. 721(E) dated 4th proposed to be met. In all orders, October, 2021.]2 sanctioning re-appropriation, the reasons Rule 68 Inevitable Payments. for saving and excess of Rupees 1 lakh (i) Subject to the provisions of or over and the primary units (secondary Article 114(3) of the Constitution, units, wherever necessary), affected shall money indisputably payable by be invariably stated. The authority Government shall not ordinarily sanctioning the re-appropriation shall be left unpaid. endorse a copy of the order to the (ii) Suitable provision for anticipated Accounts Officer. liabilities shall invariably be made Rule 66 Supplementary Grants. If savings are in Demands for Grants to be not available within the Grant to which the placed before Parliament. payment is required to be debited, or if Rule 69 For easy reference an extract relating to the expenditure is on “New Service” or procedures followed in the Accounts “New Instrument of Service” not provided Office for check against provision of in the budget, necessary Supplementary funds as a part of pre-check of bills has Grant or Appropriation in accordance with been placed at Appendix 10. Article 115(1) of the Constitution shall be Rule 70 Duties and Responsibilities of the obtained before payment is authorized Chief Accounting Authority. The (Refer to Appendix 5). Secretary of a Ministry/Department who Rule 67 (1) Advance from Contingency Fund. is the Chief Accounting Authority of the When a need arises to incur unforeseen Ministry/ Department shall: — expenditure in excess of the sanctioned (i) be responsible and accountable grant or appropriation or on a new service for financial management of his not provided in Budget and there is not Ministry or Department. 2 Inserted vide DoE’s OM No.8(18)/2021/E.II.A dated 06.05.2022 in view of DEA OM F.No.4(13)-B(SD)/2021 dated 18.04.2022 16 (ii) ensure that the public funds appropriated to the Ministry or Department are used for the purpose for which they were meant. (iii) be responsible for the effective, efficient, economical and transparent use of the resources of the Ministry or Department in achieving the stated project objectives of that Ministry or Department, whilst complying with performance standards. (iv) appear before the Committee on Public Accounts and any other Parliamentary Committee for examination. (v) review and monitor regularly the performance of the programmes and projects assigned to his Ministry to determine whether stated objectives are achieved. (vi) be responsible for preparation of expenditure and other statements relating to his Ministry or Department as required by regulations, guidelines or directives issued by Ministry of Finance. (vii) shall ensure that his Ministry or Department maintains full and proper records of financial transactions and adopts systems and procedures that shall at all times afford internal controls. (viii) shall ensure that his Ministry or Department follows the Government procurement procedure for execution of works, as well as for procurement of services and supplies, and implements it in a fair, equitable, transparent, competitive and cost- effective manner; (ix) shall take effective and appropriate steps to ensure his Ministry or Department: - (a) collects all moneys due to the Government and (b) avoids unauthorized, irregular and wasteful expenditure. 17  Ch.-4 - GOVERNMENT ACCOUNTS Rule 71 Preparation and presentation of accounts shall represent the actual cash Accounts. Accounts of the Union receipts and disbursements during a Government shall be prepared every year financial year as distinguished from showing the receipts and disbursements amounts due to or by Government during for the year, surplus or deficit generated the same period. during the year and changes in Rule75 Period of Accounts. The annual Government liabilities