the tamil nadu budget manual volume i...the tamil nadu budget manual chapter i. introductory. this...

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THE TAMIL NADU BUDGET MANUAL

VOLUME I

SEVENTH EDITION

(Issued by the Finance Department)

(0GOVERNMENT OF TAMIL NADU

1992

PRINTED BY THE DIRECTOR OF STATIONERY AND

PRINTING, MADRAS ON BEHALF OF THE

GOVERNMENT OF TAMIL NADU

1992

PREFACE

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The Tamil Nadu BUdget Manual contains therules framed by the Finance Department for theguidance of estimating officers and departments of thesecretariat in the preparation and examination af thebudget estimates and the subsequent control overexpenditure to ensure that it is kept within theauthorised grants. The Manual was first issued in1925 and it was revised in 1938 fallowing theconstitutional changes consequent on the Government ofIndia Act, 1935. The promulgation of the constitutionof India in 1950 and the changes of procedure in thefinancial side of the administration~necessitated athird edition in 1956.

2. The rationalization of the accountingclassification of Government transactions from 1962-63necessitated certain modifications in the fourthedition of the Budget Manual.

3. The Government of India constituted a teamin 1969 to consider certain matters relating toaccounts and budget heads based on the recommendationof the Administrative Reforms Commission. The teamfelt that it was necessary to bring about as close acorrelation among the Budget heads, Accounts heads andPlan heads as possible so that they could presentclearly the purposes and objectives of the Government.Based on the report of this team, the Tamil NaduGovernment has adopted the revised classification ofaccounting with effect from 1st April' 1974. Thesechanges in the structure of accounts classificationand also accounting procedure were incorporated in thefifth edition of the Budget Manual issued in 1979. Areprint of this as sixth edition was brought out in1984.

4~ This edition y the seventh, includes acomplete revision of the powers of reappropriation ofdepartments. The further change made in theclassification of accounts to bridge in thedivergence between Plan programmes and accountingclassification and ensure a closer correlation betweenthem (with effect from 1st April, 1987) has also beenincorporated in this Edition. The Chapter on

ii

definition of basic conceptscomprehensive. Suitable mentionthe Government Data Centre inaccounts has also been made.

has been made moreof the role played bythe compilation of

5. The chapters are conveniently given foreach item of activity like preparation of Budget,reappropriation and supplementary appropriation. Achapter on Zero base budgeting hass been added.

6.separately

The appendices to this manual arein another volurne~

giVen

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7~ Any error, inaccuracy or omission noticed,may be brought to the notiCe of the Secretary toGovernment, Finance Department.

Fort St. George,Madras-600 009,August 1992.

N. NARAYANAN,Secretary to Government,

Finance Department,

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•TABLE OF CONTENTS

, CHAPTERS Pages

•I. Introductory 1

II. Definitions

III. Preparation of Departmental Estimates

25

42

• IV. Preparation and Scrutiny of Part-II Estimates 71

V. Preparation of the Budget by the FinanceDepartment

VI. Presentation of the Budget to and itsDisposal by the .Legislature

81

B6 iVII. Subsequent Action ~n respect of the Budget

after Budget is voted95

VIII. Review of receipts and control of expenditure 101

IX. Reappropriations and SupplementaryAppropriations

123

X. Financ~al Procedure relating to New Schemes 141to be introduced in the course of thefinancial year

XI. Budgetary Irregularities 167

XII. Appropriation Accounts, Finance Accounts and 169Audit Report

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XIII. Committee on Estimates

XIV. Committee on Public Accounts

XV. Estimates for Central (Agency) Subjects

XVI. Performance Budget

XVII. Zero-Baseline Budgeting for AcceleratedGrowth (Ze-BAG)

177

181

187

196

201

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CHAPTER I.

INTRODUCTORY.

This Manual contains rules framed by theFinance Department for the guidance of estimatingofficers and departments of the Secretariat in regardto the budget procedure in general and to thepreparation and examination of the annual budgetestimates and the subsequent control. over expenditurein particular to ensure that it is kept within theauthorised grants or appropriations.

2. Annual Financial Statement.- Under Article202 of the Constitution of India, a statement of theestimated receipts and expenditure of the State foreach financial year has to be laid before theLegislative Assembly (G.O.Ms.No.672, Finance (BG.Il,dt.24.7.19B7). The estimates of expenditure show"Charged" and "Voted" items of expenditure separatelyand distinguish expenditure on revenue account fromother expenditure. This statement is known as the'I Annual Financial Statement II or "Budget ...

3. (a) Structure of Government Accounts.- Allreceipts and disbursements of the State Government areshown in the Annual Financial Statement in threeseparate parts, namely:-

Part I-Consolidated Fund of Tamil Nadu.Part II-Contingency Fund of Tamil Nadu.Part III-Public Account of Tamil Nadu.

(b) Consolidated Fund.- Under Article 266 ofthe Constitution of India all revenues received by thestate Government, all loans raised by that Governmentby the issue of treasury bills, loans or ways andmeans advances and all moneys received by thatGovernment in repayment of loans form one consolidatedfund called the "Consolidated Fund of Tamil Nadu". Nomoneys out of this Fund can be appropriated except in

2 THE TAMIL NADU BUDGET MANUAL

accordance with law and for the purposes and in themanner provided in the constitution.

(c) Contingency Fund.- Under Article 267 (2)of the Constitution of India, the Legislative Assemblyhas established a contingency Fund in the nature of animprest created by a non-recurring contributions ofRs.30 Crores from the consolidated Fund of the Stateand the Corpus of the Fund is Rs.75 Crores at present.The Contingency Fund is intended to provide advancesto the Executive Government to meet unforeseenexpenditure arising in the course of a year pendingits authorisation by the Legislative Assembly by law.The amounts are paid back to the Fund after theLegislative Assembly approves it what are called "TheSupplementary Demands".

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[See The1954, as amendedAppendix (G). )

Tamil Nadu Contingency Fund Act,and the rule framed thereunder in

(d) Public Account.- Receipts anddisbursements, such as deposits, reserve funds,remittances, etc., which do not form part of the"Consolidated Fund" are included in the Public Accountof the State. Disbursements from the Public Accountare nob subject to the vote by the LegislativeAssembly as they are not moneys issued out of the"Consolidated Fund".

4. Divisionmain divisions of the

of the Consolidated Fund.Consolidated"Fund are:-

The

(i) Revenue Account.

(ii) Capital Account.

(iii) Debt (comprising Debt and Loans andAdvances) •

Revenue Account is the account of (a) thecurrent income and expenditure of the State derivedmainly from taxes and duties, fees for servicesrendered, fines and penalties, revenue from Government

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THE TAMIL NADU BUDGET }~NUAL 3

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estates such as forests and other miscellaneous itemsand (b) the expenditure met from that income. Thedifference between 'SUCh income and expenditurereprese~t5 the revenue surplus O~ deficit, as the casemay be, for that year.

Capital Account is the account of expenditureincurred with the object of increasing concrete assetsof a material character and which are more or less ofpermanent value as in th~ case of buildings" etc. Italso includes receipts arising generally from sale ofconcrete assets intended to be applied as a set off tocapital expenditure. Expenditure on capital accountis usually met from scurces other than currentrevenuest e.g., borrow~d funds or accumulated cashbalance::;. ExpC'~ditl1re or. assets I,Jhich do not vest inGovernment is not treated as capital expenditure. Thepractice of i~itial c~pitali~2tion and subsequentwrite back of certain itemg of ex~enditure likecommuted value of pensions, grants for development,etc., adds to avoidab10 accounting adjustments andbudgetary provisions y~ar after year and has,ther8fore, been digcontin~ed fron 1974-75.

Note 1.- The d~cision whether expenditureshall ba met from current rev~nues or from borrowedfunds rests with the Executive-cum-the LegislativeAssembly.

Note 2.- Capital expenditure may be broadlydefined as expenditure incurred with the object of,either increasing concrete as=cts of material andpermanent character. !t is, however, not essentialthat the concrete assets Sllould be productive incharacter or even revenue producing.

Note 3.- Aft9r it ha~ been decided to incurexpenditure far the cr~iltion of a ne'.>.' or additionalasset, the classification of the expenditure betweenI'Capital l' and "Revenue" is made as follows~-.

(a)constructionintermediate

capital bears all charges for the firstof a project as well as charges formaintenance of the work ,~hile not open~d

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for service and bears also charges for such furtheradditions and improvements as may be sanctioned underthe rule made by the competent authority.

(b) RQvenue bears all sUbsequent charges formaintenance and all wO~king czpcnses. These includeall expenditure On the working and upkeep of theproject and alEo on such rem!'~Ju.l, replacement and suchadditions, -improvements of extensions as under rulesmade by competent. aut:'ority are debitable to theRevenue Account.

(c) T~~ criteria for the clacsification ofexpenditure bQtween RevGnu~ and Capital accounts inrespect of itcm~ of e~p~ditu~0 on the project of"Wo"':""k.3" , "Mac]", ine~y and ~\;U iP:r.Qnts" , 11 Purcha se ofCom:nadities." I ~1I"urchD.se,.kiY Governmen..c. DepaL+tments for.C'or'.~u!'!"lption in various dOI/£1rtments" znd "Developmentof Projects lika Soil Cohscrvation" etc., are as laiddo.m be low:

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Any PLojGct/Sch~~e, co~sisting of a number ofworks r cozting more than Rs.5.00 lakhs as a wholeshall be treated a3 e~pital e~pcnditure. If there areindividual works within this project costing less thanRs,. 1. 00 lakh these shull also be debited to thecapital account as minor works. The classification ofindividual works formi'1g pa"t of a project will dependonly on whether the p"oject itself is debitable tocapital or revenue and not on the outlay on theindividual works. If the scheme consists only ofminor works e.Q. annu~l lumps~m prevision for minorwork~ for each departm:nt t]l~n the entir~ amountirrespective of the total ptovision ~hall be debitable •to revenue account.

Ih respect of individc31 w~rJ:s nat formingpart of a p~oject/5chem~J the cost of ~hich exceedsRs.l.OO lakh the expenditure shall be debited to thecapital account. Individual works costing belowRs.l.00 lakh shall be treated as minor works debitableto the revenue account.

THE TAMIL NADU BUEGET MANUAL 5

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The expenditure on purchase of commodities inbulk such as food grains, fertilizers, materials andequipment etc., for distribution to pUblic shall bebeaked to the capital account irrespective of theamount involved~

In respect of purchase by Governmentdepartments for consumption in various departmentse.g. purchase of stores in Stationery and PrintingDepartment, purchase of Cement and Steel by PublicWorks Department the existing practice of debit torevenue account or capital account depending on thefinal debit shall be followed.

Purchase of new machinery costing individually-mOre than Rs.I.OO lakh shall be debited to capital

account. Expenditure on a new arrangement ofmachinery costing totally more than Rs.5.00 lakhs,although individual items may cost less than Rs.I.OOlakh may be debited to capital account.

Whenever machinery is replaced costingindividually more than Rs.l.00 lakh, the expendituremay be debited to capital account. While replacingthe machinery if the total cost of the new arrangementis mOre than Rs.5.00 lakhs, although individual itemsmay cost less than Rs.l.OO lakh the entire expenditureshould be shown under capital account~

In reSpEct of expenditure on development.projects like Soil Conservation, Agriculturalpump-sets distribution etc., where the initialexpenditure is met by Government and a portion of theexpenditure is later treated as subsidy and thebalance'treated as loan to the beneficiaries, theentire initial expenditure may be debited to revenueaccount and inter account transfers may be resorted togive the final picture.

Public Deb~.-This division comprises loansraised by Government such as market loans, loans fromthe Life Insurance .Corporation of India , etc41 and theborrowings from the Central Government 4 the sector"E. public Debt" will have two major heads, Le.,

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Debt of the State Government" andand Advances from the Central

Transactions connected with these areon the receipts and disbursement sides~

"6003. Internal"6004. LoansGovernment" .recorded both

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Advances.-This division comprisesmade by Government and also

The Sector "F. Loans andpattern of classification as for

Transactions connected withboth on the receipts and

Loans andloans and advancesrecoveries thereof.Advances" will havecapital expenditure.these are recordeddisbursement sides~

5. Sectors and Heads of Accounts.-(a)Six-tier classification-For purposeful review of theGovernment operations and appreciation of reSourceallocation at the national level and for providing alink between budget outlays on the one hand andfunctions, programmes and schemes on the other hand,at the same time ensuring item~wise control ofexpenditure, a five-tier classificatLon structurewhich incorporates the following has been introducedunder the revised classification effective from 1stApril 1974 - •

(I) Sectors {comprising sub-sectors wherevernecessary) to indicate the grouping of the series of·governmental functions broadly:-

(i) General services (Defence, Police,. GeneralAdministration):

{iil Social and community Services (of thedevelopment functions like Education,Public Health and so on);

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•{II) Major heads {comprising sub-major heads

wherever necessary) to indicate the functions ofGovernment, such as Agriculture, Education, Police,etc ..

{iii) Economic .Services (functions relatingAgriculture, Industry, Power, etc.).

to

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THE TAMIL NADU BUDGET MANUAL 7

(III) Minorprogrammee under each

heade tofunction or

denote themajor head.

various

• (IV. Sub-heads todevelopment expenditurenon~development expenditurehead.

denote the schemes foror o~ganisations forunder each programme minor

• (V) Detailed heads toobjects of expenditure euchexpenses; etc.

indicate theas salariee,

specifictravel

While in the revised matrix only fivetires-have been adopted by many States, a sixth tierof classification, viz., sub-detailed head of accounthas been added by this State to indicate the break-updetails under the detailed heads, wherever necessary,in the Budget estimates from 1974-75 onwards.

The following is anclassifiation in the budgetreference to a plan scheme :-

example of six-tierand accounts with

PART I - CONSOLIDATED FUND.

First Tier Sector Social and CommunityServices

Second Tier Major HeadSUb-Major Head

22 U2. >Educat ion01. Elementary Education

Third Tier Minor Head 101. Government PrimarySchools

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Fourth Tier Group eub-head schemes in the EighthFive Year PlanII. State Plan

Fifth Tier

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Sub-head

Detailed head

JB. Additional enrolmentof pupils> of the agegroup 11-14

01. Salar ies

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Sixth Tier Sub-detailedhead

(1) Pay(3) Medical Charges(4) Other Allowances(7) Travel Concession

•The details of classification in each tier are givenbelow ;-

(b) Sectoral classification. -Revenue/Capital/Loan/Plan/Non-Plan

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The following sectoral classificationadopted for accounts as well as for plan purposesgroup the services of Governmental functions :-

A. General Services -

is'to

(a) Organs of State(b) Fiscal Services{c) Interest payments,

Dividend and profits(dl Administrative Services(e) Pensions and Miscellaneous

General Services(f} Defence Services

8. Social and Community Services

C. Economic Services -

Services which areindispensable tothe existence of anorganised Statesuch as Defence,Police, ExternalAffairs and TaxCollection.

Basic SocialServices forindividuals orgroups ofindividuals such asmedical, education,housing I labour andemployment.

theof

(a)(b)

(c)(d)(e}

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General Economic ServicesAgriculture and AlliedServicesIndustry and MineralsWater and Power DevelopmentTransport and CommunicationsRailways

Services infieldsregulation,production anddistribution tohelp economicgrowth to such as

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o. GranLs-in-aid and Contributions Transfer ofresources fromCentre to ForeignGovernments, Centreto States andCompensation andAssignments toLocal Bodies andPanchayati RajInstitutions.

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(g) Posts and Telegraphs agriculture,industry, power andtransport .

(c) Major ffeads-Within the revenue and capitaldivision mentioned in paragraph 4 above, thetransactions are grouped into sectors which arefurther sub-divided into sub-sectors and major headsof account a The major heads normally indicate withineach sector/sub-sector the broad functions of aparticular department of Government. In the oldclassification t the 'major heads in the revenue andcapital divisions were numbered serially, Romannumbers being employed on the Receipts side and Arabicnumbers on the disbursement side~ There was nonumbering for debt, loans, deposit and remittanceheads. In the revised structure of accounts which hascome into effect from 1st April 1974, three digitArabic code numbers for all the major heads in theConsolidated Fund, Contingency Fund and Public Accounthave been given~

~ This codifications has been modified furtherwith four digit Arabic numerical code effective from1st April, 1987, while adopting a new list of major,sub-major and minor heads of accounts in order tobring about a closer correlation between Plan schemesand Account Heads.

The coding pattern as-adopted above is asunder :-

A Four digit Code has been allotted to theMajor head, the first digit indicating whether theMajor Head is a Receipt Head Or Revenue Expenditure

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Head, or Capital Expenditure Head or Loan Head. Ifthe first digit is "0" or "1" the Head of Account willrepresent Revenue receipts, "2" or "3" will representRevenue Expenditure, "4 11 or "S" Capital expenditure,"6" or "7" Loan Head, 14000 for capital Receipt) and"8" will represent Contingency Fund and PublicAccount~

Adding 2 to the first digit of the RevenueReceipts will give the number allotted tocorresponding Revenue Expenditure Head, adding another2 - the Capital expenditure Head and another 2 - theLoan Head of Account, for Example :

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0401

2401

4401

6401

Represents the Receipts Headfor Crop Husbandry.

The Revenue £xpenditure Headfor Crop Husbandry_

capital Outlay on Crop Husbandry.

Loans for Crop Husbandry.

'Such a pattern is however not relevant forthose departments which are not operating Capital/Loan

.heads of accounts, e.g. Department of Supply.

In a few cases, however,Receipt/Expenditure is not heavy, certain Majorhave been combined under a single number, theHeads themselves forming SUb-major Heads undernumber.

whereHeadsMajorthat

The codification pattern has been thus evolvedin such a manner that the first digit indicateswhether the major head falls in the receipts sectionor the expenditure section in Revenue Account or inCapital Account or Loans and Advances and Public debtor Public Accounts Sections. The last three digitswill be the same for the corresponding major heads inthe Revenue Receipts Section, Revenue ExpenditureSection, Capital Receipts/ Expenditure section and theLoans and ~dvances section. The - Receipts major heads

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THE TAMIL ~ADU BUDGET MANUAL 11

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are assigned the block 0020 to 1999, Expenditure majorheads on Reve~ue Accounts from 2011 to 3999,Expenditure major heads on capital Accounts from 4001to 5999, Major heads under Public debts from 6001 to6004 and those under loans and advances t inter statesettlement and contingency fund from 6001 to 8000 andthe major heads in the public account from 8001 to8999. For example, the major head "Medical" in thesector <lSocial and· Community Services" and "CropHusbandry" in the sub sector "Agriculture and Alliedservice.·, will have the following codes:-

Receipts MajorHeads.

( 1 )

ExpenditureMajor Heads.

, (2)

Capital MajorHeads.

( 3 )

Loan MajorHeads.

(4 )

0210 Medicaland PublicHealth

0401 Crop'Husbandry

2210 Medicaland PublicHealth

2401 CropHusbandry

4210 CapitalOutlay onMedical andPublic Health

4401 capitalOutlay on CropHllsbandry

6210 Loansfor Medicaland PublicHealth

6401 Loansfor CropHusbandry

In the loan section major headsopened with reference to functions andinstead of the beneficiaries.

have beenpurposes

.(d) Sub-Major heads.-The Major heads are sub

divided in some cases into sub major heads. Sub majorheads are opened under a major head to record those~transactions which are of a distinct nature and are of.sufficient importance to be recorded exclusivelYI butat the same time allied to the function of the majorhead. The head of account relating to each such s~b

division .is termed as "sub major head·' and the budgetcode is 2 digit code e.g. undet' the major head "2202.Education" the sub major heads are .-

01. Elementary Education

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02. Secondary Education

03. University and Higher Education etc.,

Note.-Where there is no sub major head, thenumerics "00" will' be used as a dummy, treating themajor head, as a sub major head.

(e) Minor heads.-The major head and sub majorheads are sub divided into minor heads. The' minorheads corresponded to programmes or broad gr9ups ofprogrammes. It is output-oriented rather thanorganisation or input oriented. This Classificationhas facilitated performance budgeting. Classificationupto this level, i.e, Sector/sub sector, major,sUb-major head, minor head is prescribed by theComptroller and Auditor General and is common toCentral and State Governments. The Budget code forthe minor head is a three digit code e.g., under"2202. Education·', the minor heads ar.e OI-ElementaryEducation :-

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DOL10I.104.

Direction and Administration.Government pri~ary Schools.Inspection, etc.

These minor heads are divided into groups ofsub-head called group sub-heads. Group sub-heads areas under:'"

1. Non-Plan

11. State Plan

III. Centrally-Sponsored.

V. Schemes financed by Autonomous Bodies.

VI. Schemes shared equally between Stateand Centre.

( f)will figureoccasionally

Sub-heads.- Under the Group sub-heads,sub-heads which indicate schemes andthe administrative set-up in the case of

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non-plan expenditure. The Budget Code is a two-digitcapital alphabet as' shown below:-

Budget Blocks of Alphabet• Code. code.

Non-Plan I AA to IZ

• State Plan II JA to RZ

Centrally Sponsored III SA to TZ. .Schemes financed by •Autonomous Bodies V ZA to ZZ

Schemes shared equallybetween State and Centre VI UA to YZ

(g) Detailed head.- Sub-heads are furtherdivided into detailed heads. The detailed headsdenote specific objects of expenditure like salaries~

machinery and equipment. The budget code for adetailed head is a two-digit numeric.

The fOllowing are the standard detailed heads~

These standard detailed heads record the various itemsof expenditure normally common to all departments:-

Code No. Description( 1 ) (2 )

01 Salaries

02 Wages•

03 Dearness Allowances .

04 Travel Expenses

05 Office Expenses

06 R~nt, RateS and Taxes

07 Publications

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08 Advertising and Publicity

09 Grants-in-aid

10 Contributions

11 Subsidies

12 Scholarships and Stipends •

13 Hospitality/EntertainmentExpenses

14 Sumptuary Allowances

15 Secret Service Expendi-ture.

16 Major Works

17 Minor Works

18 Maintenance

19 Machinery and Equipments

20 Tools and Plant

21 Motor Vehicle

22 Investments

23 Loans

24 Materials and Supplies

25 Interest

26 Dividends

27 Pensions

28 Gratuities

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29

30

31

32

33

34

35

36

37

36

39

40

41

42

43

44

45

46

47

Depreciation

Inter-Account Transfers

Write off and Losses

Suspense

Payments for professionaland Special Services

Other Charges

Royalty

International Programmes

Payments out of Discretionary Grants farHigh Dignatoriea

Deputation/Travel abroadot Scientists

Rewards

Discount on Loans

other DiscQunts

Service or commitmentCharges

Cost of Ration

Arms and Ammunition

P.O.L. (Petroleum, Oil andLUbricants)

Clothing, Tentage andstores

stores and Equ ipment.

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80 Lumpsum Provision

(G.O.Ms.No.800, Finance (BG.II), dt.26.7.1990),

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Inheads, theheads haverequirements

addition to the above standardfollowing additional non-standardbeen opened to meet theof certain departments.-

detaileddetailed

special

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66

67

68

69

70

71

72

73

74

75

99

Non-Standard Detailed Heads

Medicines

Feeding/Dietary Charges

Cost of Books/Note BookslSlates, etc.

Procurement of AgriculturalInputs

-Unemployment Relief

Printing Charges

Training

Transport Charges

Purchase and up-keep ofAnimals

working Expenses

Miscellaneous

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The standard objects of expenditureclassification prescribed by the comptroller andAuditor-General cover all the common types ofexpenditure incurred by various Departments and a fewadditional detailed heads have been opened to recordcertain specific items peculiar to certaindepartments.

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(h) Sub-detailed heads.- The detailed headsare further divided into sub-detailed heads which arethe lowest units of classification of accounts. Theydenote the break-up of detailed heads of accounts of •object classification, wherever necessary for progressof control. The Budget code employed is One digitArabic Numeral. Examples are given below;-

Detailed heads

01. Salaries

05. Office Expenses

19. Machinery and Equipment/Tools and Plant

21. Motor Vehicles

Sub-detailed heads

(1) Pay(3) Medical Charges(4) Other Allowances(7) Travel Concession

(1) Telephone Charges(2) Other Contingencies

(1) purchase(3) Maintenance

(1) Purchase(2) Maintenance

As this level of classification was notoriginally contemplated by the Comptroller andAuditor-General of India, the Accountant-General willnot keep accounts to this level except in the case ofthe detailed head Salaries. However, Heads ofDepartments/Treasuries/Government Data Centre willkeep the break-up under all sub-detailed heads for thepurpose of budgeting and reference.

•(i) The introduction of any new Major or Minor

hEad or abolition or change of nomenclature of any ofthe existing Major or Minor heads requires ~he priorapproval of the Comptroller and Auditor-General ofIndia. ~e Government can order the introduction ofany new sub-head wherever necessary. The Governmenthave delegated the powers of opening the standarddetailed heads to the Heads Df Departments. However,nDn-standard detailed heads are opened under anysub~head Dnly by the Government with the authDrisation


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of the Comptroller and Auditor-General. TheGovernment may also open sub-detailed heads, wherevernecessary. New sub-head of accounts will be openedand indicated by Finance (BUdget-General) Departmentalong with the allotment of Budget/D.p.Codes in thedraft orders itself when routed throu¢h by theadministrative Departments of secretariat.(G.O.Ms.No.235, Finance (BG.II) dt.29.3.S3).

A list of authorised Major and Minor heads is given inAppendix B.

6. Divisions of Public Aecount.items in the Public Account are groupedfollowing sectors, namely:-

The majorunder the

II) Small Savings, Provident Funds, etc.

(J) Reserve Funds

IK) Deposits and Advances

IL) Suspense and Miscellaneous

(M) Remittances

(N) Cash Balance

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The first three sectors comprise receipts andpayments (other than those falling under Debt headspertaining to the Consolidated Funds) in respect ofwhich Government act as a banker receiving amountswhich they afterwards repay and paying out amountswhich they subsequently recover. The fourth and thefifth sectors comprise merely adjusting heads underwhich appear remittances of cash between Treasuriesand transfers bet~een different accounting circles in,the Public Works Highways Department. The initial

• debits or credits to the heads in these sectors arecleared eventually by either transfer to the finalheads of ~ account or by corresponding receipts orpayments either within the same circle of account orin another account circle.


7. Charged Expenditure.- Article 202 (2) ofthe Constitution of India requires that the estimatesof expenditure embodied in the Annual FinancialStatement should show separately the sums required tomeet expenditure described by the Constitution a~

expenditure charged upon the consolidated Fund of theState. The estimates of charged expenditure are thefirst charge on the consolidated Fund and shall not b~

submitted to the Vote of the Legislative Assembly butthis will not prevent the discussion in theLegislative Assembly of any of those estimates. It is.usual to print figures and de~ails .elating to Chargedexpenditure in .italics in the BUdget documents.

A detailed list of the items of expenditure•

which are charged on the Consolidated Fund of theState is given in Appendix F.

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8. Preparation of the Budget Estimates andtheir transmission to the Finance Department.- Underthe rules made by the Governor for the convenienttransaction of the business of the state Governmentand the instructions issued thereunder, FinanceDepartment is responsible for the preparation of theannual Budget. The Budget is prepared on the basis ofthe material furnished by the departmental officersand the administrative departments of the Secretariat.The Heads of Departments and other estimating officersprepar~ the estimates for each head of account withwhich they are concerned and forward them to theFinance Department and to the appropriate departmentsof the Secretariat by the prescribed dates. Theadministrative departments of Secretariat scrutinisethe estimates and make available their comments onthese to the Finance Department which then examinesthe estimates. Estimates under certain heads arefurnished by the administrative departments of theSecretariat and the Accountant-General. A statementshowing the names of the estimating Officer,administrative department of Secretariat concerned and ~

due dates for submission is given in Appendix C.

9.estimates

Proposals for newreferred to in paragraph

expenditure.- The8 take cognizance


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only of what are called 'standing sanctions' i.e., allrevenues based on existing laws, rules and orders andall expenditure incurred by virtue of existing rulesand orders. Proposals which involve a reduction or anincrease in revenue otherwise than in pursuance ofauthorised Codes, Manuals and Rules and proposals for'new expenditure' (See Chapter IV) should be submittedto Government from time to time as they arise and theyshould not be taken into account in preparing thedepartmental estimates. Separate estimates forproposals for the abondonment of existing revenue andfor schemes of new expenditure arranged in the orderof urgency should, however, be sent so as to reach theadministrative department of the Secretariat by the1st October of each year. These proposals areexamined by the respective administrative departmentsand subsequently by the Finance Department and arethen placed before the Council of Ministers, fordecision as to which of the proposals should beprovided for in the Budget with reference to theresources available and the comparative urgency of theproposals.

10. Presentation of the Budget Statements tothe Legislative Assembly.- The Finance Department thenconsolidates the estimates embodying the decision ofthe Council of Ministers and prepares

(a) the summary statement of receiptsand disbursements;

(b) the detailed estimates of receipts; and

(c) the statement of the demande forgrants ,followed by detailed estimates.

The statements include both expenditurecharged on the Consolidated Fund of the State andexpenditure not so charged. A Budget Memorandumexplaining the figures in these statements is alsoprepared by the Finance Department. All thesedocuments are presented under Article 202 of theConstitution of India to Legislative Assembly by theMinister in-charge pf Finance by about the end ofFebruary or early in March each year.


11.Discussion and voting by the LegislativeAssembly.- The Legislative Assembly is at liberty todiscuss the Budget including the expenditure chargedon the Consolidated Fund,· but with reference toArticle 203(1) of the Constitution, estimates of theexpenditure charged on the consolidated Fund are natsubmitted to the Vote of the Legislative Assembly.The Legislative Assembly is empowered to vote on theBudget. Estimates of expenditure which are notcharged on the consolidated Fund are submitted to theAssembly in the form of Demands for Grants. TheDemand will for the gross expenditure without takinginto account the r.ecoveries taken as reduction ofexpenditure. There should ordinarily be a Oemand forGrants for each major head; but in some cases two ormore Demand may be proposed for a major head while inothers, two .or more major heads of parts of majorheads may be included in a single Demand. TheLegislative Assembly may assent to or refuse to assentto any Demand or assent to a Demand subject to areduction of the amount specified therein.

12. Appropriation Act.- After the Demands forGrants have been voted by the legislative Assembly, aBill to provide. for the appropriation out of theConsolidated Fund of the State of all moneys requiredto meet the voted as well as charged expenditure isintroduced in the Legislative Assembly on therecommendation of the Governor. No amendment shall beproposed to any such Bill in the Legislative Assemblywhich will have the effect of varying the amount ofaltering the destination of any Grant so made orvarying the amount of any expenditure charged on theConsolidated Fund. When this Bill is passed by theLegislative Assembly and it has also received theassent of the Governor, the amount shown "therein canbe expended during the financial year concerned.

13. Other Estimates.- Occasions may arise forapproaching the Legislative Assembly with proposalsfer Votes on AccQunt{ Votes of Credit and Exceptionalgrants besides s~pplementary or additional or excessgrants. These are dealt with in Chapters II and IX.

•

•

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•

14. Authorisation oE expenditure.-Exceptwhere the expenditure is covered by the standingsanctions or necessary powers have be~n delegated with

.the concurrence of the Finance Department to the

.administrative departments of Secretariat, Heads of

. Departments and subordinate authorities in thesebehalf provision of funds in the Budget by itselfconveys no sanction to the subordinate authorities toincur expenditure~

•The following

. before the public moneyconditions mustis spent,-

be satisfied

(i) The expenditure should.the authority competent to sanction(in the case of works expenditurePublic Works Department thisadministrative approval as wellsanction l .

be sanctioned byauch expenditureincurred by theaanetion means

as technioal

(ii) sufficient funds should have beenprovided for the expenditure in the appropriation Act

.. or by reappropriation by the authority competent tosanction reappropriation (See Chapter IX).

(iii) No_,propriety which

involved;

breach of the standardsare mentioned below,

of financialshould be

•

•

(a) The expenditure should not be prima facie-. more than the occasion dernands~ Every Government

servant should exercise the same vigilance and care inrespect of expenditure from public money under hiscontrol as a person of ordinary prudence would

(', exercise in respect of expenditure of his own money.

(b) Public money should not be utilised forthe benefit of a particular person or section of thecommunity unless;

(i) the amount of expenditure involved isinsignificant; or

•


Iii) a claim for the amount can beenforced in a court of law; or

liii) the expenditure is in pursuance of arecognised policy or custom.

(c) No authority should exercise the power ofsanctioning the expenditure to pass an order directlyor indirectly to its own advantage.

•

(d) The amount of allowance, suchtravelling allowances granted to meet expenditureparticular type sho~ld be so regulated thatallowances are not on the whole sources of profitthe recipients.

asof athe

to,

•

15. Committee on Public Accounts.- TheAppropriation Act has the effect of determining theobjects on which money may be spent from theConsolidated Fund of the state and the amount whichcan be spent on each object. The amount ofexpenditure which can be incurred is thus strictlycontrolled by the Legislative Assembly. The extent towhich the wishes of the Legislative Assembly asexpressed by the demands voted by the LegislativeAssembly, are actually complied with is investigatedand brought to the notice of the Legislative Assemblyby the Committee on Public. Accounts Ifor theconstitution and function of the Committee see Chapte~

XIV) •

16. Central Government's Estimates.- Theinstructions contained in this Manual relate to theState Budget. The State Government have also toprepare the Budget Estimates for certain Centralsubjects administrated by them as Agent for theCentral Government, . e.g. f National Highways. Theinstructions issued by the Central Government for thepreparation of these estimates are summarisedgenerally in Chapter XV .

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CHAPTER II.

DEFINITIONS.

17, Unless there is anything repugnant in thesubject or context, the terms defined in this chapter

~ are used in the Manual in the sense here expiained.Words and phrases used in the Manual which are definedin the Constitution of Ind~a or in the rules andorders framed under the Constitution bear the meanings

• assigned to them in those definitions:-•

(1) Accounts or actuals of a year are theamounts of receipts and disbursements for thefinancial year beginning on April 1st and ending onMarch 31st following, as finally recorded in theAccountant-General's books.

(2) Administration approval of a scheme,proposal or work is the formal acceptance thereof bythe competent authority for the purpose of incurringexpenditure thereon as and when funds permit.

(3) Annual Financial Statement or Budgetthe statement of the estimated reoeiptsexpenditure of the State for each financial yearlaid before the Legislative Assembly. (Seeparagraph 2 of Chapter I).

meansand

to bealso

•

•

(4) Appropria~ion means the amount authorisedby the Legislative Assemb~y for expenditure under amajor or minor head or sub-head or detailed head orpart of that amount placed at the ?isposal of adisbursing officer (The word is also used inconnection with the provision made in respect ofcharged expenditure).

(5) Appropriation Accounts are the accountsprepared by the Comptroller and Auditor-General ofIndia for each grant or appropriation in which isindicated the amount of the Grant/Appropriation"sanctioned and the amount spent under theGrant/Appropriation as a whole. Important variationsin the expenditure and allotments under different


group heads (Voted/Charged) are explained therein withthe comments of audit. (See also Chapter XII).

(6) Appropriation Act-See paragraph 12 ofChapter I.

(7) (a) Budget, Basic Concept- A Budget is apre-determined plan, a financial and/or quantitativestatement prepared prior to a defined period of time.of policy to be pursued during that period for thepurpose of attaining a given objective.

•

•

Theessentials:-

definition covers the following

(i) Period of preparation.

(ii) Budget period.

(iii) The objectives to be attained.

(iv) Budget statements.

(v) The policy to be pursued.

(b) Budget of an organisation orIt is a well conceived plan intendedinc~easing production and efficiency at awith a view to optimising profits.

a business.to help inreduced cost

(c) Budget of the State Government.- It is theItatement of the estimated receipts and expenditure oftihe state as per policy of the Government, for eachILnancial year to be laid before the LegislativeA.sembly.

(d) Relationship between Budget and Ways andHeans.- The Budget gives the estimates of receipts anddisbursements for a whole financial year under various~eads of accounts mentioned therein4 Transactionsthroughout the year are not uniform, nor might the~eceipts and expenditure in a month or upto a period~e proportional strictly' to the budgeted figure forthe whole year. The function of the ways and means

,

•


•

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wing is to keep a close watch over the daily cashbalance of the State with the Reserve Bank of India,review the receipts and disbursements for each monthunder the major heads of receipts and expenditure andto initiate corrective measures not only to see thatthe need, if any, for taking temporary advances fromthe Reserve Bank of India to bridge the gap betweeninflow and outflow of cash, is kept below the maximumlimit fixed by the bank for such advances but also tosee that the progress of receipts and expenditureunder various heads of account from month to month iskept at a level which would ensure that the receiptsand expenditure for that year as a whole is more orless close to the assumptions made in the budget.

jel Budget control.- The authorityadministering a grant is responsible for watching theprogress of expenditure under its control and forkeeping it within the sanctioned Grant orappropriation. To facilitate control, departmentalaccounts are maintained by the Chief ControllingOfficers and the progressive actuals month by monthare reconciled with those entered in the books of theAccountant-General. (See also Section II of ChapterI II) .

(f) Budget Deficit.- The short fall ofreceipts when compared to the expenditure in the threeaccounts of the State viz. Consolidated Fund,Contingency Fund and the Public Account taken togetheris known as budget deficit.

(g) Budget Estimatesestimates of the receipts andfinancial year.

are the detaileddisbursements of a

(h) Budget Surplu6.- The exCeSs of receiptsover expenditure in the three accounts of the state

• viz. Consolidated Fund, Contingency Fund and thePublic Account taken together is known as BUdgetsurplus.

Ii) Budget year means the financial yearcommencing on the 1st of April and ending on the 31stof March following for which the Budget is prepared.

c"'/"l ')"" L.,. ---~_


(jl Existin~ Modified Appropriation representsthe Budget Estimate of the current year plus thesupplementary estimates voted by the LegislativeAssembly.

(k) Final Modified Appropriation means thesums allotted to any unit of appropriation as itstands at the end of the financial year, i.e.. 31stMarch, after it has been modified by reappropriationor by supplementary or additional grant or grantssanctioned by competent authority.

(1) Revised Estimates is an estimate of theprobable receipts or expenditure for a financial year,framed in the course of that year with reference tothe transactions already recorded and anticipationsfor the remainder of the year in the light of theorders already issued or contemplated to be issued orany other relevant facts. Revised Estimate is notappropriation. (See also section III of Chapter Ill).

•

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(m) capital Expenditure Budget.- Theshowing the expenditure proposed to be made onassets during the period concerned.

budgetfixed

(n) Commercial Budget is the statement ofaccounts of commercial undertakings which aresubordinate to legislative control and are owned, runand managed by the Government like AgriculturalEngineering workshop. It shows the Trading Account,Profit and Loss Account and the Balance sheet of theGovernment Commercial undertakings and are used todetermine the profit or the loss of the Commercialdepartments. The core of commercial budgetingconsists of the laying down of the physical targets ofoperations which would result in the optimumutilisation of resources.

(ol Performance Budget is a comprehensiveoperational document, conceived, presented andimplemented in terms of programmes, projects andactivities with their financial and physical aspectsClosely interwoven. Performance budget seeks topresent the purposes and objectives for which funds

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.\

•

are requested, the cost of various programmes andactivities proposed for achieving these objectives andquantitative data measuring the work performed orservices rendered or results accomplished under eachprogramme and activity. (See also Chapter XVI).

(b)day-to-daydifferenceliabilities.

•

(8 )Chapter I .

(a) Capital Account.- See paragraph 4 of

Working Capital.- The amount available forexpenses of running the business; the

between current assets and current

Ie)credited as

paid up Capital.-The amountpaid up on the shares issued.

paid up or

(d) Authorised Capital.- The total amount ofcapital which a Company is empowered to raise asstated in its Memorandum of Association.

(9) Cash Credit Accommodation.- This is afacility offered by the Commercial banks forIndustries and Trades. Under this scheme the maximumthat could be borrowed by an Industry or a trade isfixed and within such a ceiling the client can borrowmoney by hypothecating the fixed or movable assetsheld by him. When the value of the assets decreases,repayments will.have to be made to the banks and whenit increases additional loans without exceeding theceiling can be obtained.

The State Government resorts tocredit accommodation for financing itsdistribution scheme.

such cashfertiliser

(10. Cash Flow.- All cash movements, that is,all cash receipts and payments during a specified

• period. This is usually prepared as a monthwise "Waysand Means" Statement.

{ 11 )required tothe schedule

Charged appropriation means themeet charged expenditure as specifiedto an Act passed under Article 204 of

Sumin

the


Constitution during the financial yearthe service and purposes covered byAppropriation". It does not includevoted expenditure.

concerned, onthat "Chargedprovision for

(12) charged expenditure or expenditureCharged on the Consolidated Fund means suchexpenditure as is not to be submitted to the Vote ofthe Legislative Assembly under the provisions of theConstitution. sums relating to "Charged" expenditureare usually printed in italics in the DetailedEstimates and Grants. (See also paragraph 7 ofChapter I).

A list of items the expenditure on which ischarged on the Consolidated Fund of the state is givenin Appendix F.

(13) Charges in England.- see Section IV ofChapter III.

•

(14) Consolidated Fund of Tamilparagraph 3 of Chapter I.

Nsdu-See

(IS) Constitution means the Constitution ofIndia.

(16) Contingency Fund-SeeChapter I.

paragraph 3 of

(17) Controlling Officer means the authoritymade responsible for the control of expenditure forany head of account. A list of Chief ControllingOfficers and Subordinate Controlling Officers is givenin Appendix D.

(18) Cost benefit analYsis.- Costs andbenefits, social and private diverge, market behaviourcan result in socially detrimental by-products, the I

cost of which must be met outside the market. Thecost benefit notion has been rediscovered in recentyears and a considerable effort has been made ineconomic planning to assess social costs~


•

(19) Current assets.- Cash Dr its equivalentand other assets which in the ordinary course ofbusiness will be converted into cash l e.g., accountsreceivable.

(20) Current liabilities.- ThDse which must bemet within a relatively short periDd, usually withinone year frDm the date Df the balance sheet. Tradecreditors, bills payablE, bank overdrafts r taxespayable are some of the examples of such liabilities .

•(21) Government Data Centre.

system-analysis techniques, cDding andtechniques for the proper maintenance ofof Government.

Deals withprogramming

the accounts

(22) Debenture.- An instrument under sealissued by a company as evidence Df debt Dr as securityfor a loan bearing a fixed rate of interest andproviding for repayment on or before a certain fixeddate, or with no fixed date for redemption, it may besecured or unsecured, redeemable or irredeemable.

(23) Decretal amount.- See paragraph 47-A DfChapter III.

(24) Demand tor grant is a proposal made onthe recommendation of the Governor, for theappropriation of funds for expenditure to be met fromthe Consolidated Fund Df the State other than thatcharged. Each demand for grant cDntains first astatement of the total amount required, followed withdetails arranged by major heads; minor heads,sub-heads and detailed heads, etc.

(25. Departmental Estimate is an estimate ofincome and ordinary expenditure of a department inrespect Df any year submitted to the Government by ahead af department or other estimating officer~

(26) Deposit.- A sum placed usually atinterest and capable of being withdrawn either ondemand or Dnly after the expiry of the agreed term.


(27) Depreciation.-(i) A reduction in thevalue of fixed assets due to such causes as wear andtear, action of the elements t obsolescence, etc.

(ii) An annual charge equal to the value of afixed asset which is expected to lapse each year dueto such causes as wear and tear, obsolescence, etc.

(iii) The accounting process for the gradualconversion of a fixed asset into expense, whereby thecost of the asset is spread over its expected usefullife•.

(28) Detailed head is the primary unit ofappropriation. It exhibits expenditure under basicitems like salaries, machinery and equipment. For thelist of standard detailed heads with reference to thenature of expenditure-see paragraph 5(g) of Chapter I.

(29) Disbursing Officer- Every Governmentservant who draws money for disbursement on bills fromthe treasury is a Disbursing Officer/ but a gazettedGovernment servant who is not the head of an officeand who draws only his own pay and allowances from thetreasury is not included in this term.

•

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(30) Discount-ii) A deduction fromof goods allowed by a seller, e.g., tradecash discount.

the pricediscount,

( ii)below nominal

When thevalue, it

price of a share oris at a discount~

stock is

bill of(iiil Theexchange at

difference between the value ofmaturity and its present value.

a

I

(iv) To give or receive value (after deductionof discount) of a bill of exchange before it is due.

(31) Discounted cash flow.- Refers to thepresent value of future cash receipts and cashpayments, i.e., t~eir value computed by taking intoaccount a particular discount rate in transactionsphased over a period of timea

,


•

33

• •

(32) Economic Planning refers to an attempt toplan economic activity and anticipate the results.However, the term is usually used to refer to thegovernmental direction economic operations.

(33) Estimates Committee is a committeeconstituted by the Legislative Assembly for theexamination of such of the estim?tes as may deem fitto the Committee or are specifically referred to it bythe House. (See Chapter XII).

(34) Estimating Officer means aofficer responsible for preparing aestimate (A list of estimating officersAppendix CI.

departmentaldepartmentalis given in

•

(35) Exceptional Grant.-See Article 206 (l)(C) of the Constitution reproduced in Appendix 'A.

(36) Excess Grant means a Grant voted by theLegislative Assembly to meet the expenditure incurredin a financial year in excess of the amount grantedfor a service of the year. (See Section V of ChapterIX).

(37) Finance Accounts are the accountsprepared by the Comptroller and Auditor-General ofIndia. They. present the accounts of the transactionsunder the Consolidated Fund. Contingency Fund and thePublic Accounts and the accounts of assets andliabilities of Government such as Debt and Loans andAdvances by Government. {See also Chapter XII).

{3B) Funds.-Certain items of expenditure likeexpenditure on replacement of capital assets likemachineries in Government Press I AgriculturalEngineering workshop, etc., and Transport vehicles andmachineries in State Transport Department cannot bemet from the normal receipts for the year. In orderto meet Buch items of e~penditure a Fund isconstituted for each of the above items such as'Depreciation Reserve Fund', 'Natural CalamitiesRelief Fund', etc., to which yearly, contributions aremade from the revenues of the State at fixed rates.Normally the accumulations in these funds should be

•


invested in readily marketable securities so as to beavailable in items af need. When the need ofreplacement of ma~hineries/buses arise or when thereis a natural calalli j ty I the expenditure is met bydrawings from those Funds. Thus the expenditure onthe items if and when incurred will not upset thenormal Budget for the year.

Sometimes the Government levy a cess Or taxfor a specific purpose e.g., sugarcane Cess (fordevelopment of roads around Sugar Mills and also forDevelopment of Sugarcane}, surcharge on Sales Tax,(for Urban Development). The collection from suchitems are transferred from the revenue account to thefund account constituted for them in the PublicAccount. The accumulations in these funds areutilised for the specific purposes for which thelevies were made.

When a Fund is co~stituted with reference toan Act passed by the Legislative Assembly, it .iscalled a "Statutory Fund", e.g., "Calamities ReliefFund"~ Funds constituted by executive orders are"Non-Statutory" e.g. 1 "Urban Development Fund","special Welfare Fund", etc.

•

(39} GrantLegislative Assembly

means thein respect

amount voted by theof a demand for grant.

(40) Headdeclared as such by

of DepartmentGovernment.

means an officer

(41) Inventory control provides for systemsdesigned to provide on a continuing basis control datarelating to both current and anticipated stockrequirements, facilitating the prediction of possibleshortages due to peak and seasonal demands. Thepurpose is to ensure that funds are not unnecessarilylocked up in inventories but at the same timeoperations in the cSl :tal budget go On smoothly.

142)a system ofdrawings of

LeLter of Credit system in Government isappropriation control in regard to

the officers of major spending ~epartment


•

where payments are mostly by means of cheques. Itrefers to the instructions issued by the Financ~

Department to the Treasury/Sub-Treasury Officersindicating the periodwise allocations far each DrawingOfficers of the Public Works and Forest Departments.This stipulates the amount that should be drawn by theofficer concerned {i) first for a period of ninemonths from April to December (ii) second for a periodof three months from January to March based on theRevised Estimates for the year. The FinanceDepartment restricts such letter of credit to theBudget appropriation under respective major heads ofaccount.

certain(43) Loans.conditions and

Money lent toat certain rate

be repaidof interest.

on

(44) Major head means a main head of accountfor the purpose of recording and classifying thereceipts and disbursements relating to the functionsof the Government. (See paragraph 5{c) of Chapter I).

cast of( 45 1which

Major Work means a work,exceeds Rs.l,OO,OOO.

the estimated

(46) Management Information System is a systemof generating, collecting, transmitting, analysing,storing, retrieving and using information in arational and scientific manner 86 information is themost important and crucial ingredient of the decisionmaking process. The systems approach is required tofocus the attention of the administrator on alldifferent aspects or element~ which are essential tomeet his objectives or getting the required

~ information. The essential elEments are: (1) Input(data) (ii) Analysis and processing (iii) Storage andretrieval, (iv) Output (Information) and (v) Plan.

(47)Major head orof Chapter I).

Minor" head means aSUb-Major head.

head(See

subordinateparagraph

to a5(e)

(48) Minor work means a work estimated cost ofwhich does not exceed Rs.l,OO,OOO.

r


(49) Modified Appropriation means the sumsallotted to any unit of appropriation as it stands onany partioular date after it has been modified byreappropriation or by supplementary or additionalgrant or grants sanctioned by competent authority.

(50) New Expenditure. (See Chapter IV).

(51) New Instrument of Service. (See Chapter X)

(52) New service means a servioe theexpenditure on which is not oontemplated in the budget(Appropriation Aot) for the year and the expenditureexceeds certain monetary limits and for which asupplementary statement of expenditure should bepresented to the Legislative Assembly in aooordancewith the deoisions of the Publio Accounts Committee.(See Chapter X).

,

153 )39 of Chapter

Number Statement- See paragraphs 38III.

and

(54) Part I Estimates-See paragraph 22 ofChapter III.

(55) Part II Estimates-See paragraph 23 ofChapter III.

(56) Plan.- Any scheme to aooomplish a purposeoonstitutes a Plan. While firms and industries planfuture production, advertising, etc., Government plan,in varying degrees, the future development orperformance of their economics. This is usually on anAnnual Plan basis and Five-Year Plan basis. Plan5chemes are mainly divided into two categories, viz.,State Schemes and Centrally Sponsored Sohemes. Inrespect of State Schemes J expenditure is incurred bythe state and assistance is released according topresoribed pattern by the Central Government to StateGovernment subject to an over-all ceiling. CentrallySponsored Schemes are those for which the Centre andPlanning Commission attach special importance, theprogress of each one being watched by the Centre. Theshare of expenditure on these sohemes whioh is usually

,


fully borne by Central Government, is given to StateGovernment, as assistance outside the total pool ofassistance made available to the S~ate Government forfinancing the plan. There is yet another category ofschemes viz., Schemes assisted by Autonomous Bodies,in respect of which the financial assistance isrendered by the agencies like Indian Council ofAgricultural Research, National Co-operativeDevelopment Corporation, etc .

•(57) Primary Unit

paragraph 5(g) of Chapter I.appropriation are variableadministrative convenience andwill appear every year in theEst imates" ~

of appropriation.-seeThe primary units of

according to theaG such the exact unitsvolume "Detailed BUdget

(58) Programme Evaluation and Review Technique(PERT) (Critical Path Nethod) network analysis is thedesigning of the accounts data to enable a review ofthe physical progress, not only in terms of moneyspent, but in terms of the time taken for givenactivities, as against the time stipulated in the timebound activity net-work, to be prepared along with thee5timate~ The modern practice in respect of majorprojects is to analyse the project both in terms ofthe various kinds of activities -and in terms of thetime consumed for each activity and prepare a net workanalysis to decide on the timing of the individualactivities. Net work analysis consists in compiling adiagram, called net work diagram, showing the logioalsequence of activities· and the relationship betweenthem. From this diagram, the total duration of theproject can be calculated. It will also reve~l the

• sequence of activities which contain some measure offle~ibility in the time available for their completionas well as those which do not have such flexibility~

This implies that all major estimates will have to besubjected to PERTjcPM network analysis.' CriticalPath, or the series of operations crucial to timelyand proper e~ecution of the project within theestimated cost, should be constantly watched. Basedon the use of the programme Evaluation and ReviewTechnique (Critical Path Method Technique) it should


be possible to prepare a memorandum on the possibleescalation in costs over the execution period. Actioncan be taken to complete the execution of the projectin the minimum time with minimum increase in costs.The net work itself should be periodically updatedwith reference to changing conditions so that it isoperational.

•

(59) Public Account. (SeeChapter I).

paragraph 3 of•

(60) Public Accounts Commit~ee is a committeeconstituted by the Legislative Assembly for theexamination of the reports of the Comptroller andAuditor-General of India relating to the Appropriationaccounts of the State, the Annual Finance Accounts ofthe State or such other accounts or financial mattersas are laid before it or which the Committee deemsnecessary to scrutinise. (See Chapter XIV).

(51) Public Debt.- (See paragraph 4 ofChapter I).

{52) Reappropriation means the transfer by acompetent authority of saving from One unit ofappropriation to meet additional expenditure underanother unit within the same grant or chargedappropriation. (See section II in Chapter IX).

(63) Recurring charge is a charge whichinvolves liability beyond the financial year in whichit is originally sanctioned; expenditure sanctionedfor a specific purpose and for a specified period (notmore than a financial year} is not a recurring charge,

(64) Remittances.-The head of account'Remittances' under Public Account embraces all.a~justing heads under which appear remittances of cashbetween treasuries and transfers between differentaccounting circles as in the case of Public WorksDepartment. 1he initial debits or credits to the headRemittance' will be cleared eventually by correspondingreceipts or payments either within the same circle ofaccounts or in another aecounts circle .

.,


(65) Report of the Comptroller andAuditor-General of India deals with the points arisingout of Appropriation Accounts and Finance Accounts ofthe year and other' irregularities noticed in thecourse of audit financial transactions of theGovernment. It is prepared by the Accountant-Generaleach year and is countersigned by the Comptroller andAUditor-General of India. (See also Chapter XII).

•Chapter

(66)I ) .•

Revenue Account. (See paragraph 4,

(67) Standing sanctionsbased on existing laws, rulesexpenditure incurred by virtue oforders.

relate to revenueor orders and

existing rules and

(68) Sub-detaileddetailed heads or objectnecessary, and possible.Chapter I).

heads denote break-up ofclassification, wherever(See paragraph 5{h) of

•

(69) Sub-head means a head subordinate to aminor head. It indicates schemes for Plan Programmesor administrative set-up in the case of non-planexpenditure. (See paragraph 5(f) of Chapter I).

(70) SUb-major head-See paragraph 5(d) ofChapter I.

(71) Supplementary statement of expendituremeans the statement to be laid before the LegislativeAssembly under Article 205(1) (a) of the Constitutionshowing the estimated amount of further expenditurenecessary in respect of a financial year over andabove the expenditure authorised in the annualfinancial statement for that year4 The demand forsupplementary grant may be token or substantive (SeeSection III of Chapter IX).

(72) Suspense.- The head 'Suspense' underPublic Account accommodates interim transactions forwhich further operations are necessary before thetransactions can be considered complete and finally

"

40 THE TAMIL NAOU BUDGET MANUAL

accounted for i.e., 'Suspense' is nat a final head ofaccount~

(73) Technical Sanction is the approval to thedetailed designs, plans specifications and qualitiesby the competent engineering authority, which isrequired to be given to any work before itscomm,encement.

(74) Vote on account means a grant made in •advance by the Legislative Assembly in pursuance ofArticle 206(1) (a) of the Constitution, in respect ofthe estimated expenditure for a part of the newfinancial year, pending the completion of theprocedure relating to the voting of the demands forgrants and the passing of the Appropriation Bill. TheAnnual Financial statement is generally presented tothe Legislative Assembly in the month of February andnormally the general discussion thereon in LegislativeAssembly, the voting of the demands for grants by theLegislative Assembly and the passing of theAppropriation Bill are expected to be completed beforethe end of March, so as to make available the grantsand appropriations for the ensuing year right from thecommencement of the year~ But circumstance maysometimes arise in which this may not be possible. Onsuch 'occasions, demands for advance grants in respectof the estimated expenditure for a part of the yearmay be presented.

(7S) Vote of credit.-see Article 206 (I) (b)of the Constitution reproduced in Appendix A.

(76) Voted expenditure means expenditure whichis SUbject to the vote of the Legislative Assembly.It is to be distinguished from 'Charged' expenditure.

(77) Zero base line budgeting means a 'denovo' examination af all items of expenditure incurredby a department to find out their necessity withreference to functions and responsibilities of thedepartment.

t .,

•

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(78] Zero base line budgeting forgrowth (Ze-BAG): The modified process ofBudgeting to incorporate Government'sfunctions, structures and operations forgrowth •

•

t

,41

accelaratedZero Basedrole and

accelarated

j

CHAPTER II!.

PREPARATION OF DEPARTMENTAL ESTIMATES•

SECTION I-GENERAL

18. Accuracy of estimates and responsibilitytheretor.-(a) Under the rules made by the Governor forthe convenient transaction of the business of theState .Government and the instructions issuedthereunder, the Finance Department is responsible forthe preparation of the annual budget for which itobtains materials from the various departmentalofficers, and the departments of Secretariat. If thematerial supplied by the departmental officers andSecretariat Departments is defective, the estimateswill also be defective and the responsibility thenreverts to the officers who supplied the material. Itis, therefore, essential that preparation of thedepartmental est-imates should receive the closestpersonal attention of the estimating officers. Theestimates should be framed after a careful andthorough consideration of all items of expenditure andof all sources of income and of every factor lfkely toaffect the actual results. Every care should be takento See that the estimates are neither inflated norunder-pitch~d but are as accurate as possible.

(b} As the Government accounts are maintainedin general on a cash basis, the estimates should takeinto account only such receipts and payments(including ·those in respect of the arrears of pastyears), as the estimating officer expects to beactually realised Or made during the budget year andnot on the basis of the total dues outstanding.

19. Estimates to be prspared on gross basis.The budget estimates should, as a rule, be prepared ona gross" and not on a net basis. The grosstransactions in the _case of both receipts and chargesin each department should be sent separately.Receipts should be estimated on the receipt side andthe expenditure on the expenditure side. In otherwords, it is not permissible to deduct receipts from

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the charges or the charges from the receipts. Thereare, however, certain exceptions to this general ruleof gross budgeting. Refunds of revenues, forinstance, are deducted from the gross collections andthe budget is prepared only for the net receipts, thereason being that the refunds do not really representthe expenditure of Government but are merelyrepayments made out of the receipts4 The receipts oncapital account are also taken, as reduction ofexpenditure and not shown on the receipt side.

There are certain cases in which a service isundertaken by One Government on behalf of anotherGovernment or an outside body subject to the recoveryof the cost of the service+ The recoveries ofexpenditure in such cases are treated as revenuereceipts of the Governmellt rendering such services orsupplies.

20. Rounding off.- The estimates under eachlowest unit should be rounded off to the nearestRs.l,OOO. ordinarily provisions amounting to Rs.500and above will be rounded to Rs.l,OOD and those belowRs.5DO om,tted except where this has the effect ofleaving no provision at all in which case a sum ofRs.l,OOO should be provided. This is however intendedonly to simplify bUdgeting by avoiding meticulouscalculations. The sanctions to be accorded after thepassing of the budget will be for the actual amountsand not in accordance with the rounded figures. Inthe case of estimates in respect of expenditureincurred in United Kingdom and adjusted finally by theChief Accounts Officer, High Commission in UnitedKingdom the estimates should be rounded to £ 2S orRs.l,OOO.

21. Channels and ddtes for transmission orestimates to Finance Department.- The ,Heads ofDepartments and other estimating officers shouldprepare the estimates for each head of account withwhich they are concerned on the basis of the materialobtained by them from the subordinate officers. Theskeleton forms (in triplicate) duly filled in shouldbe returned to Finance Department direct in duplicat~

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along with Examination sheet, and the third copy maybe sent to the administrative Department in theSecretariat. The administrative department of theSecretariat will scrutinise the estimates and· makeavailable their comments to the Finance Department. A ,statement showing the estimating officers for thevarious heads of account, the administrativedepartments of Secretariat, the due dates for receiptof estimates in the Finance Department direct from theestimating officers and from the administrative •departments of Secretariat is given in Appendix C. Itis utmost important that the duly scrutinizedestimates are submitted without fail by the prescribeddates, in fact the endeavour should be to submit thema few days earlier so as to enable a proper scrutinyby all the concerned authorities. Delay in thisrespect may upset the entire budget programme and mayinvolve a possibility of any item not being adequatelyprovided for or even omitted altogether.

22. Part I Estimates.- The departmentalestimates referred to above should take cognizance ofonly what a~e called "standing sanctions", i.e., allrevenue based on existing laws, rules or orders andall expenditure incurred by virtue of existing laws;rules or orders. These are called the Part IEstimates.

23. Part II Estimates.- (a) Proposals whichinVOlves a reduction or an increase in revenueotherwise than in pursuance of authorised codes,manuals, rules or orders and proposals involving t'newexpenditure" (see Chapter IV) .should be submitted toGovernment separately by the prescribed date. If adepartmental officer feels any doubt whether apa~ticular proposal should be. treated as constitutinga "new expenditure", he should make a reference toGovernment in the administrative department concernedwell in advance of the prescribed date.

(b) Proposals relating to "new expenditure"should be submitted to Government as and when readyand in any case not later than the 1st October so thatadministrative departments of Secretariat and the

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Finance Department may have sufficient time to examineeach proposal as closely as possible and to call forsuch further information as may be deemed necessary_It must be clearly understood that any proposalreaching the Finance Department after the prescribed

• date will. not be ordinarily entertained and theresponsibility for the inc~nvenience which may be.caused to the public service On that account wil~

attach to the officer or the administrative departmentconcerned who or which failed to ta~e action in time .

•24. Classification of receipts and

expenditure in Part I Estimates.-·A list of major andminor heads of aCCQunt as prescribed by theComptroller and Auditor-General of India is given inAppendix B. The introduction of any new major and orminor head as well as the abolition or a change in thenomenclature of any of the existing major or minorheads require the appr~val of the Comptroller andAuditor-General and cannot be carried out until suchapproval. has been obtained. The sub-heads, detailedheads and sub-detailed heads are however variableaccording to convenience and as such the exact unitswill appear every year in the state Budget under"Detailed Budget Estimate". The .detailedclassification of receipt heads is shown in the volume"Detailed BUdget Estimate of Revenue". In the matterof accounting and control of expenditure, theclassification and nomenclature of the head as givenin the Detailed Budget Estimates should be followedunless they are SUbsequently modified by the FinanceDepartment.

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Note.- While submitting the departmentalestimates, under the detailed heads the estimatingofficer should as far as possible, propose estimatesunder the standard detailed heads see para 5(g) ofChapter I. The estimating officer may, whereabsolutely necessary, have a detailed head notprovided for in the previous year's budget. But whiledoing so he must prominently bring it ~o the notice ofthe Finance Department to enable them to decide'whether the proposed new detailed head should beintroduced or the provision made under any of theexisting standard detailed heads •.

, 85(21--2A •

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25. Estimates to be accompanied byexplanatory notes.- Each departmental estimate must beaccompanied by a note by the estimating officercontaining his proposals and the reasons in support ofthem arranged by major heads, sub-major heads, minorheads r sub-heads, detailed heads and sub-detailedheadS, etc., in the same order in which the estimateshave been prepared. The note should be clear andprecise and should explain the variations between theproposed estimates for the forthcoming year and thefigures of the budget estimates of the current· year.It should also"give reasons for the repetition or theomission of any item. Both the estimate and this noteshould be sent in duplicate direct to the FinanceDepartment with a copy to the administrativedepartment of the Secretariat.

26. Corrections to estimates and time limitsfor their submission. - 'cor~ct ions, if any, to theestima'tes should be sent direct to the. FinanceDepartment by demi-official letter to the BudgetOfficer with a copy to the administrative departmentwithin one month from the date of submission of theestimates and in any case not later than the 15thDecember4 Corrections received after these dates willnot be considered.

SECTION II--BUDGET ESTIMATES.

(al Revenue and Receipts-Part I.,

27. In the preparation of the budget the aimis to achieve as close an approximation to the actualsas possible. It is therefore essential that notmerely should a~l items of revenue and receipts thatcan be foreseen be provided but also only so much andno more should be provided as is expected to berealised, including past arrears, in the budget year.The following instructions should be carefUllyobserved in preparing the estimates:-

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(i} The estimates should be based On theexisting rules and rates of taxes, duties/ fees l etc.,and no increase or reductions due to changes in suchrates which have not been ·sanctionedby Governmentshould be proposed; •

(ii) An estimate should show the amountsactually expected to be received during the budgetyear and those only. The arrears, if any, standingOver from past years for collection should be includedif there is a reasonable certainty that they would berealised within the year. On the other hand, theestimates should exclude any receipts which, althoughfalling due during the budget yea.r, are not expectedto be actually realised within that year;

•(iii) In preparing the estimates of all

receipts of fluctuating nature careful attentionshould be given to all abnormal factors as well ~B tonormal conditions and tendencies like opening up of anew irrigation work for breaching of irrigation canalsor famine conditions affecting the realisation ofrevenue;

(iv) The gross transactions should beexhibited in full, unless in any particular Case thereare definite instructions to the contrary when netreceipts may be entered and a brief explanation givenin the remarks column;

(v) Provision is to be made in the revenueestimates, where necessary for refunds, which areshown under' a separate minor head ~Deduct-Refunds'

under the major/sub-major head falling in the sector'B. Non-Tax Revenue! unless it is not practicable toexhibit such refunds as aub-heads below the programmeminor heads ~nder the relevant major/sub-major headsin this sector and under Ie. -Grants-in-aid andcontributions'. Refunds will be accounted for under·adistinct aub-head 'Deduct-Refunds' opened .below therelevant minor head under major/sub-major headsfalling under "1\ Tax Revenue" so that the netcollect~on from the each tax/duty can be readilyascertained from the accounts ;.' and

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(vi) If proposals for enhancement or reductionin the rates of taxes, fees, etc., have been sent toGovernment separately, the financial effect of suchproposals should be indicated in the explanatory note.

•28. The reasOnS which have led to the

proposing of estimates for the enSUing· year should befully and clearly explained, item by item, in theexplanatory note of the estimating officer, especiallywhen the estimate proposed for the ensuing year is inany way abnormal, due regard being paid to thefollowing variations:-

(i}actuals of the past year compared with theoriginal and the revised estimates of that year;

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(ii) revised estimates for thecompa~ed with the original estimates;

currentand

year as

(iii) budget estimatesfollowing year compared with theestimates for the current year.

proposed for theoriginal and revised

29~ Where several items of miscellaneousnature are grouped under a single head of account,details of the more important items should be givenalong with the estimates proposed for each item in theexplanatory note.

(b) Expenditure-Part I.

30. The estimates of expenditure under Part Iare those for the expenditure expected to be incurredin the coming year for the normal working of the •departments with reference to the existing 9anctions~

No item con5titut~ng "new expenditure" shouldtherefore' be included in these estimates~ Theestimates should be as close and accurate as possibleand the provision to be included in respect of eachitem should be based on what is expected to beactually paid or spent under proper sanction duringthe year including arrears of past years and notmerely confined to the liabilities pertaining to the


year. The need for every item must be fullyscrutinized before provision for it is included andthe amount should be restricted to the absoluteminimum necessary. The various general or specificorders issued by Government or by heads of departmentfor econom¥ in expenditure must be carefully borne inmind and complied with."

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•31. The Finance Department prepares skeleton

printed forms and supplies to each head of thedepartment Or other estimating officer . who submitsestimates direct to the Government, in the printedskeleton forms. The following is a typical skeletonform for the detailed estimate of expenditure for1993-94.

-_ ....... _---

Accounts1991-92

BudgetEstimate1992-93

BudgetEstimate1993-94

(9)( 8 f(7 )

RevisedEstimate1992-93

( 5 )( 4 )(3 )(2 )

Sub-Major,Minor,Sub-head,detailedheads ofappropriations.

{l)

Columns (3), (5), (7) and (91 give figures byminor heads, sub-heads and detailed heads ofappropriation while columns (2), (4), (6) and (81 givedetails for the items comprised in some detailed headsof appropriation. The sub-detailed head figures willin each case add upto the figure shown immediatelyabove in the next column against the detailed headconcerned~

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32. The estimates of the current year mustnever be adopted blindly as a basis for framing thoseof the following year. There is always a temptationto save trouble by taking the current year's estimatesfor granted and adding something to certain items onwhich increased expenditure is foreseen. Thistendency ~s to be strongly depreciated. Theestimating officer must give his closest personal

r,. 85/21~-2C

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attention to each and every item and see that theitem~, of expenditure which have become obsolete areomitted. At the same time it is his duty to see thatprovision for all expenditure that can be reasonablyforeseen and does not constitute "new expenditure" ismade in the e5timate~ Care must be taken that noprovision for increased ~xpenditure requiring specificsanction of the competent authority is included unlesssanction has already been obta1ned and that even inthe case of a sanction scheme provision is made foronly so muc~ 'of it as can actually be brought intoeffect in the budget year.

33. In preparing the estimates, the averageof the actuals of the past three years, as also therevised estimates for the current year shouldinvariably be kept in sight not as something thatcould conveniently be repeated but as a basis for anintelligent anticipation which takes into account anynoticeable tendency for the expenditure to rise ordecline, any abnormal feature during the past years,any recognizable regularity in the pitch ofexpenditure and any special feature known to becertain or likely to arise during the budget year.When any specific item of expenditure although coveredby standing sanction is to be held in abeyance underthe orders of competent authority, provision for itshould be omitted. If it is proposed that it shouldbe revived specific reference to the competentauthority should be made well in time and in that case-the estimating officer can include the provision inthe estimates but he must draw pointed attention tothis in his explanatory note at the appropriate place.

34~ Lumpsum provision.- Lumpsum provisionshould nat as a rule be made in the estimates~ Insome cases- however lumpsum provisions becomesunavoidable, e.g., provision for grants to localbodies or to provide managements for water supply anddrainage scnemes, road and bridges and the like.Except when expenditure out of lumpsum allotments isregulated by standing sanctions, instructions or rulesfull explanation in justification of the provisions

·pxoposed, with indication of the principal items

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should be given and working out of the details shouldbe started immediately after the amounts have beenfinally included in the budget so that there may be nodelay in their examination and the issue of sanctions .

35. The earlier practice of exhibition ofcertain expenditure and receipts taking place inUnited Kingdom under distinct "minor heads 'Charges inEngland', and 'Receipts in England' under the various.expenditure and receipt major heads has beendiscontinued. Such items of expenditure and Leceiptswill be accounted for and merged with otherexpenditure/receipts of the same nature under therelevant programme minor head. Detailed instructionsfor the preparation of these estimates are given insection LV.

36. Estimates for pay and leave salaries ofOfficers and establishments.- The pay, leave salaryand fixed allowances of a Government servant(excluding pensioner) for a month become due forpayment at the end of the month, i,e., on the lastworking day of each month. If the last working day ofa month is a Saturday the payment will be made on theprevious working day. The salaries for the month ofMarch, shall however be disbursed on the first workingday in April, since it will be covered by the Budgetof the next financial year.

37. (a) The estimates should be framed on thebasis of the expenditure likely to be incurred in thecoming year on account of the officers andsubordinates likely to be on duty and the actual pay(including special pay and personal pay but excludingcompensatory allowances} to be drawn by themirrespective of the ~ctual sanctioned strength. Inthe case of holders of posts carrying time scale ofpay, provision should also be made for incrementsfalling due during the year. In the case of a cadrewhich includes leave or training reserves, theestimatei should provide not only for such of itsmembers as are likely to be on duty but also thosewho are likely to take leave or under training but noseparate provision should be made on account of leave


·salaries. In small cadres of gazetted officersprovision for leave salaries need not be made unlessit is definite that certain officers will go on leave~

Provision for leave salaries in respect of largecadres of gazetted officers and of non-gazettedestablishments should not be made on any percentagebasis but on the average of the past actuals plus suchincrease for new posts as may be considered necessary.

{bl No provision should be made for posts heldin abeyance. If it is considered necessary to reviveany of them in the ensuing year proposals thereforshould be submitted in good time and necessary ordersof the competent authority obtained.

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(c) The estimate intemporary posts should be shownrelating to permanent posts.

respect of payseparately from

ofthat

(d) It is probable that estimates carefullyprepared in accordance with the foregoing instructionsmay still be too high. They should, .therefore, beexamined with reference to the differences between theestimates and the actuals in past years and a lumpsumdeduction should be made for probable savings. Eachestimate should be rounded to the nearest thousandrupees.

38. Numerical strength of off~cers andestablishments.- The number of posts budgeted for inthe current year and those for which provisions havebeen proposed for next year in the estimates should beclearly indicated, both for permanent and temporaryposts. The scales of pay should also be includedunder each detailed head, but it will be sufficient ifonly the minimum and maximum pay is shown instead ofthe full scale. In the case of temporary pos~s

prOVision should be made only for the continuance ofsuch posts as are definitely required to be retainedand for the period for which they will be. actuallyrequired. The number and the date of the orders bywhich each post was created or last retained shouldinvariably be quoted for reference. If any additionaltemporary posts are required for any sanctioned scheme

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or project on the basis of the approved programme orwork, provision for them may be included in the budgetestimates~ Their necessity should, however, beclearly explained and it should be reported whetherthe cost involved is included in the sanctioned castof the sclleme or project.

39. The Number Statement for Pay of .Officersand Establishment should be prepared in Annexure I tothis Chapter. Number Statement for fixed allowanceslike Dearness Allowance, House Rent Allownace, etc~1

should be prepared in Annexure-II to this chapter.While furnishing these Number Statements, care shouldbe taken to follow instructions on the standardisationof new detailed heads issued by the Government.Besides! an abstract in the Annexure-III should alsobe given, specifying the total strength as also thedetails of the staff in each category in eachdepartment, including permanent ahd temporaryestablishment, both in Gazetted and NDn-gazettedServices/ Sub-headwise, under the respective majorheads. Those sub-heads not representing provisionsfor stctff should be left out. The Numger Statements socomp~led should set out the staff position as on 1stJuly of each year and should be submitted by theEstimating Officers to Government ~n FinanceDepartment On the 1st August of each year well inadvance of the departmental estimates.

NOTE When submitting the budget estimatesfor village establiShments, whose pay bills areaudited by Treasury OfficerS J the RevenueAdministration departments should append to theestimd~es certificate LO the effect that sanctionedscale has been verified and found COrrec~. Thiscertificate should be based on similar certificatesto be obtained by the Revenue Administration Departments from the ~reasury Officer concerned.

40. Al1owances.- The estimates for allowancesshould generally be drawn up under the two detailedheads/sub-detailed heads of Salaries~Other allowancesand Dearness Allowance. The estimates pertaining toFixed Travelling Allowance should, however J be drawn


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up under the detailed head 'Travel Expenses'. In thecase of Dearness Allowance and other Allowances whichare fixed allowances, the estimates should be based onthe sanctioned rates and after making actualcalculations of amounts to be drawn by the incumbentsof the various posts in the budget year and aftertaking into account changes J if any, in the rates dueto increase in pay on accrual of annual increments.The estimates on fluctuating items like TravelExpenses should generally be based on the currentyear's allotment viewed in the light of average of thepast three years' actuals, allowance being made forany causes likely to modify that figure. Particularcare should be taken to see that the estimate "forTravel Expenses (other than fixed travellingallowance) is restricted to the absolute minimumamount necessarYI consistant with the paramount needto observe economy under this head. Unless full andconvincing reasons have been given in the explanatorynote, all increases proposed by the estimatingofficers are liable to be cut down by the FinanceDepartment.

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41. Allowancescontingencies&- Provisionif any drawn by staff"Contingencies" should be·wages'.

of staff paid fromfor compensatory allowances,whose pay is met from

made unde~ the detailed head

42. (a) office Expenses.- The estimates forthis class of expenditure require careful scrutiny bythe Controlling Officer. The actuals for three yearsshould be given in the explanatory note. Abnormalcharges if any should be specified and excluded fromthe total in calculating the average af the threeyears preceeding. Justification is needed in allcases in which it is proposed to exceed the normalaverage.

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(b) •'Maintenance',maintenanceincidental to~s.5,OOO.

Naintenance.- Thewill include all

of works and alsomaintenance costing

detailed headprovisions on

include repairsnot more than


In cases of new works the cost of which isbetween RS.5,OOO and RS.lO,OOO and treated asexpenditure of civil departments, the expenditure ifidentifiable under a programme or project, should beaccounted for under that programme as an objectclassification, viz., 'Minor Works'. If 'this is notpossible, it should be classified .under the minor head"at her expendi tu re" .

43. WorkS4- Expenditure on works isclassified under distinct detailed heads titled "minorworks" or "major works" under the respective activitysub-heads depending on the outlays involved on thework. All works the cost of which exceeds Rs.l,OO,OODindividually will be debited to the detailed head"Major Works" under the respective activity sub-heads.Any work the cost of which is less than Rs.l,OO,OOOwill be booked under the detailed head "Minor Works"under respective activity sub-heads.

0nder each detailed head "Major Works" detailsof the actual works will have to be furnished in thefollowing form along with the bUdget estimates inrespect of all departments,-

Item Name of Estimated Cumulative BudgetNumber Work cost as per expenditure Estimate

• latest on the work for thesanction up to the current

end of the 'yearpreviousyear

( 1 ) (2 ) (3) (4 ) (5 )

Rs. Rs. Rs

• Revised Estimate Budget Estimate Remarksfor the current for: the next yearyear

{ 6) (7) ( 8 )

Rs. Rs.


Information in column (3) should be the latestsanctioned estimate. The figures of actuals upto theend of 31st March of the previous year should take intoaccount clearance of the debits from the transitoryheads in the Public Account. In respect of newsanctions issued during the year for which there are noprovisions in the budget estimates of the current yea~,

information in a separate statement should be furnishedin the following form in addition to the estimatesnormally furnished in the above form: •

,Details ofwork 'WithGovernmentOrder Numberand date.

( 1 )

Amount ofEstimate

( 2 )

Provisionsought forin currentyear'sRevisedEstimate.

(3 )

Provisionfor ensuingyear's Budgetestimates,if any.

( 4)

In respect of provisions sought for under thedetailed head "minor works" full justification withdetails of minor works, costing between Rs.I0,OOO toRs.l.OO,OOO should be furnished.

44. Departmentwise ceilings for minor works.In order to ensure that the expenditure on minor worksfor a particular department is not excessive in anyyear t Government have prescribed suitable monetarylimits upto which expenditure on minor works under thebuildings sub-head" of various departments. can' beincurred in any year. Based on the recommendations ofthe Administrative Refocrns Commission orders have beenissued in G,Q.Ms.No.160, PWD, dated 3rd February 1975classifying any work the cost of which is below Rs.llakh as a minor work. Consequently a comprehensiverevision of the departmentwise ceilings for minor workshad been undertaken to be in consonanCe with the reviseddefinition of a minor work and th~ revised ceilings farthe various departments are as follows:-

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Serial number andName of Department

(1 )

Existing monetarylimit

(2 ) Rs.

Revised monetarylimit

{3} Rs.--~-----~~~--------------------------~------------------

1. Land Revenue2. State Excise duties

20,0001,000

2,00,0005,000


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3. Registration

4. General AdministrationResidence of theGovernor (Charged)

5. General Administration:(Dt. Administration)(Other works includingSecretariat)

6. Administration of Justice(High Court and otherworks)

7. Jails

8. Police

9. Scientific· Departments(Government Museum)

10. Education (other thanTechnical Education)

11. Technical Education

12. Medical

13. Public Health(King Institute)

14. Public Health(Excluding King Institute)

15. Agriculture

16. FishE!ries

17. Animal Husbandry

18. Co-operation

19. Industries

20; Public Works

60,000

50,000

1, 50, 000

1,41,000

77,000

1,59,000

15,000

1,00,000

1,00,000

4,00,000

7,500

12,500

26,000

5,000

36,000

2,500

10,000

1,75,000

1,00,000

50,000

4,00,000

1,50,000

85,000

2,25,000

20,000

3,00,000

1,00,000

5,00,000

50,000

30,000

5,000

55,000

4,000

10,000

1,75,000

58 THE TAMIL NAOU BUDGET MANUAL

21- Stationery and Printing 22,500 30,000

22. Fire Protection and Control 60,000 60,000

23. LabouL" (including 5,000 5,000 -,Factories)

24. Communication (including 2,00,000 2,00,000Highways and Rural Works)

25. Forest 5,000 5,000

26. Commercial Taxes . .. 4,50,000

The above limits takefinancial year 1981-82.

effect from the

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45. Notor vehicles.- The expenditure on MotorVehicles u5ed for any purpose, whether for functionalactivity like Ambulanc~ Or for running an office shallbe recorded under this detailed head. TheBub-detailed head "Purchases" will record expenditureon purchase of vehicles constituting an additional tothe fleet strength or replacement for condemnedvehicle. The sub-detailed head "Maintenance" shallrecord the expenditure 9n purchase of spare parts f

repair charges and servicing charges. The expenditureon propUlsion charges shall be debited to the detailedhead "Petroleum, oil and Lubricants"~

46. Other Charges.- The detailed head "Othercharges" is meant to be a residuary head to recordexpenditure which cannot be fitted into other standarddeta~led objects of expenditure. This has to be verysparingly used ensuring that the provisions exceedingRs.25,OOO should not be exhibited under this head, inorder to ~void indiscriminate classification of itemsof expenditure under this detailed head and tosimplify the accounting practice. [G .. O.Ms.No.800 1

Fi~ance (BG-II), dt.26.7.90]. The Finance Departmentwill cuthorise the opening of this detailed head inrespec~ of any sub-head only after satisfying itselfthat the expenditure cannot be conveniently bookedunder one of the specific standard detailed objects ofexpenditure .

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47.duty shouldat the timeincidentalins'urance t

Customs duty on imported scores.- Thebe calculated at the tariff rates in forceon the gross value of the stores includingcharges, such as those for 'packing,

freight and landing of the stores.

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The estimates on customs duty normally formpart of the cost of the stores on which duty is paidand should therefore be included in the cost of thestores and shown in the estimates accordingly. Thiswill apply to the stores purchased for the PublicWorks Department when the cost of the imported storesis eventually treated as part of the cost of the worksfor which they are used and also to stores importeddirectly by educational and other institutions insteadof through the High Commissioner for India.

In all other cases, the co~t of importedstores is debited under the relevant major, minor, suband detailed heads of account under which they wouldhave been classified had the transactions taken placein India, and the cU5toms duty which is paid in Indiashould be debited to a separate account head "customsduty" as part of the expenditure of the ChiefControlling Officer or Officers under the major headconcerned.

47-A. Paymen~ of decretal amounts4-Expenditure on payments made in satisfaction of anyjudgement, decree or award of any court is to betreated as charged on the Consolidated Fund of thestate. As reappropriation between Charged and Votedprovision is not permissible, it is necessary thatcharged provision should be restricted to the absoluteminimum additional funds being arranged later, ifrequired through supplementary estima~es. In ~ases

where no appropriation within the grant for chargedexpenditure is available, advance from ContingencyFund can be obtained.

NOTE.- The expenditure onArbitrator under the Arbitrationsection 10-A of Industrial Disputescharged item of expenditure.

~~~ll ~l--,~

the award by theAct, 1940 under

Act, 1947 is not a

60 .... THE TAMIL NADU BUDGET MANUAL

SECTION III-REVISED ESTIMATES.

48. The revised estimate is an estimate of theprobable receipts or expenditure for a financial yearframed in the course of that year with reference to thetransactions already recorded and anticipations for thecemainder of the year in the light of the orders alreadyissued or contemplated to be issued or any otherrelevant facts. Revised estimate is only an estimateand as it is not voted by the Legislative Assembly it isnot an appropriation. It does not authorize anyexpenditure or does it supeisede the budget estimate asthe basis for regulation of the expenditure. Ifprovision is made for additional expenditure in them, itis necessary to apply separately for the additionalappropriation required, unless this has already beensanctioned. Similarly a reduction in any provision offunds in the revised estimate does not obviate thenecessity for formal surrender of any amount provided inthe budget estimates which is not likely to be spent.At the same time it is the duty of the ControllingOfficer to see that as far as possible the expenditureduring the remaining part of the yea~ is so restrictedthat the total expenditure for the year does not exceedthe revised estimate figure. That is, Final ModifiedAppropriation shall not exceed Revised Estimate takingthe demand as a whole.

49~ The reduction in the revised estimate maybe due to one or more of the following causes:~

(i) actual postponement of expenditure;

{ii) real savings due to economy measures; and

(iii) normal savings due either to over estimatingor administrative Causes e~g., casualties, etc~

Savings due to clause (i) are Ln nocircumstances to be u5€d to meet new items ofexpenditure without prior sanction of Government~

Unless savings due to clause (ii) have been madedeliberately to provide for a fQreseen emergency, theyshould not ordinarily be utilised in the course of theyea~ for new items of expenditure.

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50. TIle revised estimateo of the current yearare prima facie the best indicatio!lS as to what thebudget estimates for the coming years could be. It isthereore essential that they should be prepared withgreat care 50 that ttl8Y may ~pproximate as closely aspossible to the actuals which will not be availablefor some months after the close of the financial year.These estimates enable the Government to arrive at theapproximate closing balance of the year which will bethe opening balance of the next year .

51.estimate.~ A

Nethods forrevi~ed estimate

framingis based

theon :

revised

Ii) ascertained actualsof a financial year;

of theand

past mon~hs

( i i) an estimate of the probable figure forthe remaining months of that year~

•

The figure for (i) 2bove being definitelyknown, it is only that for (ii) which has to beestimated and\ in doing so the actuals for the sameperiod during the previous years, chiefly those of thepreceding year, should be the main guide, dueallowance being made far any exceptional factors orunusual characteristics which may have affected theac~uals of the last preceding year or which may affectthose of the current year. If the revised figuresdiffer appreciably from the previous years figure J thereason or reasons for variation, should be clearlyexplained. Also if any special factors have affectedthe figures for {i) above, this should be mentionedand it should ,...8 explained whether or not they arelikely to continue throughout the year. The usualadjustment with other Governments and departments,etc., ,which take place during and after the close ofthe year should be duly taken into account whenframing the revised estimates~

52.based on theof the year.preparation of

(a) The r~vised estimates are generallyactuals of the first four Or six months

Assuming that at the time of thethe revised e5timat~s, the actuals, for

62

the firstavailable,calculat.ed

THE: TA/·:IL NADU BUDGET Mi'NUAL

four ~onth9 of the ~urrent

then the revised estimatesas follo'"s;-

yearmay

arebe

(il by adding to the actuals of the first four •months of the current year those of the last eightmonths of the previous year; or

(ii) by taking a proportionate fig~re so thatthe revised estimates will be 12/4 (i.e. three times)the actuals of the first four months; or

(iii) by assuming that the revised e"timateafor the current year will bear the Game proportion tothe actuals of the first four months as the actuals ofthe previous year before those of the first fourmonths of that year;

(ivi. by working out the multiplier 'M' by thefo:rmula~

Hl + 112 + M3

•

M -

where MI, 112, M3 t represent the ratio

First 4 months actuuls of the p~evious yearM =

12 months ac'tuals. f 11(L.t:. u_

of previ~us yearyear)

and by multiplying the 4 months' actuals of the yearin question with this average 'M' of the past yearw

NOTE:- Ml shall denote the rat.io of actualsof the first preceding year.

M2 shall denote the ratio of actualsof the second preceding year'~

M3 shall denote the !:"atio of actualsof the third preced.ing year.

•

TH~ TAMIL NADU BUDGET MANUAL 63

•

•

(b) The heads of departments and otherestimating officers should use their discretion andadopt one or other of the above methods of any othersuitable method for each particular case in the Lightof the actual trend of revenue or expenditure duringthe previous years, due allowance being made for anyabnormal features in those years and for factors whichmay modify the realisation of original expectationsand also allowing for seasonality if any, in certaintransactions peculiar to the concerned department. Itwould always be of advantage to base the forecast on acareful of the figures of three years immediatelypreceding rather than those of a single year.

53. Corrections to the revised estimates.Any appreciabl~ variations discovered in the revisedestimate of expenditure and receipts subsequent to thecommunication to the Finance Department should becommunicated to that department within one month fromthe date of sending the estimate and in any case notlater than the 15th December.

SECTION IV-CHARGES IN ENGLAND

54. General.- The bulk of the StateExpenditure is incurred in India but a small part ofit is incurred abroad Ii) in purchasing stores and(iil in payment of leave salaries and deputation pay.sterling overseas pay, pension and annuities, etc.,Stores required for the State are purchased in severalforeign countries~ Purchases in the United Kingdomand in certain European co~ntries are made through theIndia Stores Department, London, Payments for storespurchased through the India Stores Department,' London,and stores ordered direct from the firms abroadsubject to inspection by the Director-General, IndiaStores Department, London, are made initially by theHigh Commissioner for India, London, from the fundsplaced at his disposal and the debts are passed on toIndia every month. The Accountant-General, CentralRevenues, New Delhi, passes on the debits to theAccountant-General, Tamil Nadu for adjustment againstthe balances of the State. The amount in sterling

64

under eachrupees atbut it is


maJor or group head lS converted intothe average rate of exchange !or the month,

split up into two parts, viz.,

(1) the rupee equivalent at the official rateof exchanges, and

(2) the difference between this figure and thefigures calculated, on the basis of the average ratefor the month. Under the procedure obtained prior to31st March 1974, the difference between theconventional rate and the average rate isdebited/credited as a loss or gain in exchange underthe relevant capital major heads af commercialdepartments for'the transactions relating to them or,in lump under ~2075. Miscellaneous General Servicesor 0075. Miscellaneous General Services" if thetransactions relate to revenue heads. Under therevised arrangement effective from 1st April 1974separate adjustments for lo~s or gain by exchange aredispensed with and the transactions are adjusted at auniform composite rate, namelYt 1.M.F. parity rateplus a percentage thereof to cover loss by exchange,etc~ Accordingly unde~ the revised accountingprocedure, the Chief Accounts Officer, High Commissionin united Kingdom will send accounts classifying thetransactions, presently shown by him under the minorheads ~~Charges in England'j, "Receipts in England'"under the relevant major, minor, sub and detailedheads of account under which they would have beenclassified had the transactions taken. place in India.The Chief Accounts Officer will continue to be theestirnating officer for these transactioris. He willcontinue to pass on the transactions now classified byhim under the remittance head to the Accounts Officersin India through the remittance account as at presentfor final adjustment.

55. Nature of expenditu~e.- The chargesincurred in England by the High Commissioner of India

·on behalf of the State Governrnsnt fall mainly underthe following categories:-

•(a) Purchase of stores~

(b) Leave salaries and deputation paypayable in England.

•

•

•

•

•


(c) Sterling overseas pay (whereadmissible and drawn in England)

(d) Pensions and annuities gratuities, etc.

(e) Miscellaneous items like scholarships,contributions, stipends, cost ofpublications indented through theHigh Commissioner, etc •

. 65

.'

•

55. Preparation of estimates.- (a) The onlyregular item of receipts in England is the amountderived from the sale of Government publications.Small sums are also recovered on· account ofoverpayments, "etc. The estimates .for receipts areprepared by the High Commissioner for India in London.

(b) The High Commissioner for India in Londonprepares an estimate for the expenditure he incurs inEngland on behalf of the State Government and sends tothis Government. A small amount of expenditure by wayof payment of pensions to Military Officers in respectof civil employments on behalf of the Tamil NaduGovernment is incurred by the Secretary of State,Commonwealth Relations Office. The estimates for suchexpenditure are prepared by the Accountant-General,Commonwealth Relations Office and 8ent to the TamilNadu Government in the Finance Department by about the15th NovemQer thro~gh the High commissioner for India,London.

•(c) The High Commissioner is the disbursing

officer in regard to charges in England under hiscontrol. But he make9 payments as a rule only inaccordance with the sanctions accorded by the TamilNadu Government and their officers. It is, therefore,necessary that Heads of Department and atherestimating officers should prepar~ the estimates forthese charges in the first instance. As thedisbursing officer, the High Commissioner has accurateinformation with regard to the progress of

•expenditure, the prices of stores and the dates onwhich the stores will be ready and payments will bemade and he will correct the estimates sent to himfrom India on the basis of the fuller information


available to him. In order tbat the HighCommissionerls estimates may be received by theGovernment in Finance Department in time forexamination, heads of department and other estimatingofficers in India should prepare the revised estimatesfor the current year and the budget estimates for theensuing year for charges in England under the controlof the High Commissioner, separately from and inadvance of the consolidated departmental estimates.

57. Rate of conversion for purposes ofestimates.- For purposes of budget estimates, the rateof forty rupees to a pound is to be adopted.provision in sterling should be made by the HighCommission in its estimates in multiples of ·Jt25 andthe figures of expenditure in England which arefinally adopted by the Finance Department forincorporation in the State detailed estimate should bemultiples of Rs.l,OOO. Any figure less than ~ 25 orRs.l,ODO will be rounded to the nearest ;I;, 25 orRs.l,ODO.

58. Adjustment in accounts of Loss or Gain byExchange.-

(a) When a remittance from India is made tothe High commissioner the actu~l rupeesdebited to Government accounts by theReserve Bank of India (and not the ~upee

equivalent at parity rate) will beadjusted under a suspense head as in thecase of remittance to other IndianMissions abroad.

(b) When the High Commissioner's accounts arereceived all the transactions appearingtherein including thOSE relating to theremittance of cash should be converted ata composite rate of Exchange (i.e.I.M.F.parity rate plus a percentage thereof tocover the loss by exchange) as fixed bythe Ministry of Finance from time totime.

•

•

•

,

•

•

•

•


(C) The debits and credits afforded to thesuspense head under which the remittanceof cash is adjusted will not be equal as,the actual ~upees debited or credited bythe Reserve Bank of India and the contracredits or debits appearing in the HighCommissioner's Account converted atcomposite rate will be different. At theend of the year the net difference underthe above suspense head on account ofdebits or credits afforded by the ReserveBank of India and accounted for inGovernment accounts in equivalent rupeesand the corresponding credits or debitsappearing in 'the accounts of the HighCommission in United Kingdom at thecomposite ra~e will represent the netgain or' loss. This difference may betransferred in lump as a gain by exchangeunder the minor head "Gain by Exchange"under "0075. Miscellaneous GeneralServices" or as a loss by exchange underthe minor head "Loss by Exchange" under"2075. Miscellaneous General Services".

(dl All the transanctions shown in theMission's account including the receiptof remittance may be, converted at thecomposite rate of exchange. There willnot be any separate adjustment of 1055 orgain by exchange, and as in the case ofremittance to the High Commissioner inUnited Kingdom, the balance, if anYIoutstanding under the suspense heads willalso be transferred to the major head"Miscellaneous General Services" as lossor gain. . Similarly the composite rateshould be adopted for the conversion oftransactions appearing in the accounts ofthe India Supply Mission, Washington andconsequential recovery effected by/fromother departments, Accountant-General,etc., from/by the Pay and AccountsOfficer, Department of Supply.

67•

, 68 THE TAMIL NADU BUDGET MANUAL

59. Stores.- The expenditure on storespurchased ~n England should be included under theminor head under which expenditure for similarpurchases in India is shown.

60. Leave Salaries and deputation pay andsterling overseas pay.- Estimates for these heads'should be prepared in the forms given below. Thereshould be separate Statements for ;

•

( a ) expenditureConsolidated

chargedFund of

on thethe state; and

(b) voted expenditure.

and under each head of thesefor the current year and thecoming year.

for theBudget

Revised EstimateEstimate for the

FORM I-LEAVE SALARIES AND DEPUTATION PAY.

Head of Name of the Whether Period ofAccount OfficeI:' on depu- leave or

dation 01:' deputationon leave

(1 ) (2 ) (3 ) (4 )

Rate Total Total convertedper for the in sterling atmonth year the,tare appli-

cable to leavesalaries •

( 5 ) (6 J (7)

Rs. Rs. Rs.

•------ ------ ......... _---, Total

------ ------ ------

,, •

THE T~.;IIL U;\lJU BUSGET l1ANUAL

Form II - Sterling Overseas Po-yo

69

When leave salaiy or deputation pay- is paid inEngland , sterling overseas pay. is not -recordedseparately in the accounts but is included in theleave salary or deputation pay as tlle case may be.The provision proposed for leave salary or deputationpay and that for sterling overseas pay (to be includedin leave salary or deputation pay in the accounts)5hould~ however t be indicated separately for eachofficer in columns (5) to (7) of Form I. Theestimates for leave salaries and deputation pay andsterling overseas pay under "2052.Secretariat-General services - 090. Secretariat - AG.Share of th~ cost of the High Commissioner'sEstablishment 33. Payments for Professional andSpecial Service", will be prepared by the ChiefSecretary to Government in consultation with theAccountant-General, Tamil Nadu.

61. Latest date for submission of estimatesto the Government.- The estimates for charges inEngland, other than pensions, should reach theadministrative department of the secretariat concernednot later than the 1st August and the estimates for

, pensions will be prepared by the Accountant-General inthe usual form and sent to the Finance Department notlater than the 1st September.

62. Deleted. •


63. Scrutiny and transmission of estima~es,for charges in England· other than tho~e for stores tothe High, Commissioner+- The e5timate~ of charges inEngland other than those for stores received by theadministrative department of the Secretariat will bescrutinised by them and forwarded to the Financedepartment not later than the 5th September with suchmodifications as they may consider necessary~ TheFinance Department will examine these estimates aswell as the estimates of pension charges received fromthe Accountant-General and send consolidated estimatesto the High Commissioller so as &0 reach him nDt laterthan the 4th October.

64. ReceipF- of corrected estimaxes from theHigh cornmi"ssiC!n~r.'" The High Commissioner On the basisof these estimates, and forecast and the moreup-to-date information in his possession as regardsthe extension of periods of leave, etc,. of officers,corrects the estimates sent to him and forwards hisrevised estimates of the current year and the budgetestimates of the ensuing year to the FinanceDepartment so as to reach that department in the thirdweek of october.

•

•

•

•

•

•

•

,

CHAPTER IV.

PREPARATION AND SCRUTINY OF PART-II ESTIMATES .

65. Under the Tamil Nadu Government BusinessRules and the Secretariat Instructions, the FinanceDepartment is required to examine and advise on allschemes of new expenditure for which it is proposed tomake provision in the Budget and . is empowered todecline to make provision for any scheme cf newexpenditure which has not been so examined. (Extracts

_from the Secretariat Instructions are given inAppendix A.)

66. (a) It is not possible to define rigidlythe term "new expenditure"~ In actual practice,- basedon convention, it be~rB a wide interpretation.Broadly speaking, expenditure involved on a new schemein the adoption of a new policy, provision of a newfacility, or any substantial alteration in characteror extent of an existing facility will normally betreated as constituting "new expenditure". In somecases, increase 1n expenditure, other than increasedue to normal growth or rise in the price ofcommodities on the extension or upgradation of postsor development of an existing -scheme or facility· isalso, where it is appreciable, treated C'aa "newexpenditure" ~

(b) All proposals which are not in the natureof maintenance work are to be treated as Part~III

e.g.,if the proposal i p to plant 1,000 acres of BlueGum every year, then the planting part will be' Part-IIevery year and the maintenance of previous year 1,000acres alone will be Part~I unless of course at thebeginning of the Plan period, the sanction is givenfor the entire five years.

(c) Another feature .to be noted regardingpart-II schemes is that all schemes in regard to whichGovernment have still an option to incur or not toincur expenditure with reference' to the budgetaryposition, should be claSSified as Part-II Schemes. Forexample, in respect of a scheme for con9tr~ction of


buildings under a head of development there may be alumpsum plan outlay for an entire plan period.A certain amount of expenditure might have beenincurred in the first year, by sanctioning a fewworks a Even though there is a plan provision, it isleft to the Government to either incur the expenditureor not to incur in subsequent years. If theadministrative department desires to incur theexpenditure by taking up new items of work say in thenext year, it should bring forward the proposal forconsideration as a Part-II scheme for the next year.

67. (a) The classes of new expenditure whichshould be considered under Part-II of the BudgetEstimates requiring reference to the Standing FinanceCommittee of the Cabinet and then to the Cabinetbefore the issue of orders sanctioning the schemes arelisted out in Paragraph 170 (b) of this Manual. Inaddition, the schemes which are totally new inconcept or content and other schemes which FinanceDepartment at its discretion, wants to be treated asNew Schemes, are brought forward as Part-II Schemes,irrespective of the monetary limits laid down~

•

,

1b) .Thedown in regard to

following criteria are usuallyselection of Part-II schemes,--

laid

(i)will be for

The first charge on available resourCeSschemes which form part of the plan;

(ii) New development schemes which do not finda place in the approved five-year plan6~ will under nocircumstances, be provided for on the non-plan side; •

(iii) Schemesexpenditure will be given

involvingthe lowest

non-developmental.prioritYi

•(iv) Preference will be given to quick

yielding programmes and schemes which are expected to,yield a net revenue even in the first few years ofoperation; and

•

•.: . ,

•


•

•

••

(~) It is quite possible that some schemes(both Plan and Non-plan) which are underimplementation are not very useful to the public atlarge. A quick review has to be made to ascertainwhether economy could be effected in those schemes sothat cost thereon and staff could be utilised for moreuseful schemes. preference will, therefore, be givento schemes of those Heads of Departments, who comeforward with economy. measures elsewhere .

68. Details to be given:- Every proposal orscheme must be explained as fully and concisely aspossible and its financial implications both immediateand ultimate, as also the physical target clearlybrought out. It should also be explained and showndistinctly whether the proposal forms ·part of thedevelopment programme included in the Five-Year Plan.The estimates of cost should show the recurring andthe hon-recurring expenditure separately by the majorheads, minor heads, sub-heads and detailed heads of'account in all cases and by sub-detailed heads ofaccount r where considered necessary. In the case of

.recurring expenditure and of non-recurring expenditureproposed to be spread over a period of years, theestimates for each year should be given.

Heads of Department should also furn{sh fulldetails of assistance expected from outside (otherthan the block grant and loan received for the plan},any special conditions to be fulfilled. the period forwhich such assistance will be forthcoming and theshare of expenditure to be borne by the stateGovernment, so that the Finance Department may be ableto asseSB accurately the net liability that has to beborne by the Government.

It is better that new schemes are proposedeven from the month of May so that a thoroughevaluation can be made. It is necessary that thepractice of sending all the proposals together only inOctober is avoided.

,


SCHEMES68-A.BY THE

PROCEDURE FORSTATE PLANNING

SCRUTINY OFCOMMISSION :-

PART-II

Prior to submission of new schemes to theGovernment in Planning and Development Department andFinance Department for their examination and scrutiny,the Part-II Schemes of each year shall be scrutinizedby the State Planning Commission, keeping in view ofthe schemes already under implementation, specifyingthe benefits of the schemes, costs in each year, cashflow statements, usage of new technology if any,additional staff and vehicles required, overheadcharges, results of O&M studies or Zero Base Budgetreviews, etc. The procedure for this scrutiny will beas follows :-

(i) The State Planning Commission will callfor schemes for the next financial year in April eachyear, giving adequate time for preparation of theschemes. The Commission will also prescribe theformats for obtaining such data as may be necessaryalong with scheme proposals, in order to facilitatedetailed examination of the schemes by it.

ii) Heads of Department shall send theseproposals to the State Planning Commission by 15th Mayof each year in the prescribed formats. Such newschemes should generally be from within" the Five yearPlan and should be upto twice the previous year'sceiling, in the absence of the communication of thePart-II ceilings for that year.

iii) The Member-secretary, State PlanningCommission, will appraise the proposals in theCommission and in meetings with individual Heads ofDepartment. The first round of such meetings will beheld during June-July and the second round duringAugust-September, giving adequate time for examinationof all new schemes and for obtaining additionalinformation or making modifications.

•

•

•

iv)consideredout and a

During the appraisal, schemes notsufficiently beneficial will be weededshel~ of recommended schemes prepared,

r

TAMIL NADU BUDGET MANUAL 75

•

after careful consideration of the scheme contentincluding requirement of additional staff andover-head expenditure. The costs of introduction ofeach such scheme in the initial year and in each yearot the plan will be estimated and cash flow statementsprepared for each year of implementation during theplan period. '

•v) Part-II scheme ceilings will be indicated

• by Government and specific proposals will be calledfor in October of each year. The State PlanningCommission will then call for meetings with eachsecretary to Government and the concerned Heads ofDepartment and Members of the Planning Commission.This meeting will consider the shelf of appraisedschemes, prioritise them and recommend as part-IIschemes, only such schemes as can be fitted within theceiling for the Secretariat Department. The' procedurefor consideration of Part-II schemes beyond this stageby the Government is as contemplated in para 173 ofthe this Manual.

68-B. Part-II Schemes relating to Non-Plandepartments such as Revenue, Personnel andAdministrative Reforms, Commercial Taxes and ReligiousEndowments, Finance, Public and Horne departments are,however, finalised within the ceilings fixed at apreliminary meeting by the Secretary to Government,Finance Department with the Secretaries of thesenon-plan departments separately for placing before theStanding Finance Committee for its considereation.

•

69. Last date for submission of Part-IISchemes.- To enable a proper and detailed examinationbeing carried out by Government. all proposals orschemes under Part-II of the Budget shoula besubmitted by the heads of departments or estimatingofficers concerned to the administrative departmentsof the Secretariat concerned as soon as'they are readyand should not be held up fOr being submitted towardsthe last date which is the 1st October. Theadministrative departments will examine them

• •

76 TAMIL NADU,BUDGETMANUAL

thoroughly both from the ,administrative and financialaspects, and recommend to the' Finance Department onlysuch of them as are not. only administratively soundbut are al so really 'es'sent'ial and urgent. Theproposals should reach ,cUre .Finance Department insufficient time and in,any: tese not later than the 1stNovermber, complete in all respects to enable it tocarry out proper examination and obtain such furtherinformation as may be considered necessary by it. TheFinance Department wil-l \be~at: liberty to decline toaccept any proposal for consideration after the 1stNovember irrespective i" of~' .:the reasons~ After theschemes have been exam1ned~by;the Finance Department,the administrative dep~rtm~nts of Secretariat shouldobtain orders in ci~culation to the Ministersconcerned and the Mir'rctster 1n.:..charge' of Finance forconsidering the schemes~as'Part-II Schemes and sendcopies of Part-II No;te_ tp_ J:t-he Finance Departmentimmediately and in any" case, not later than the 15thNovember. By 15th ~Navemberr each administrativedepartment should send~to' the Finance Department alist of Part-II Scheme5';~',w:ith,·which it is concernedindicating therein the~order' of priority in which thescheme should be cons14ered' This list shouldcomprise of· two section~j~lone. for Plan Schemes andother for non-Plan schem~s~ the' schemes being arrangedin the order of prior&ty,:~in' each one of thesesections. :'S-~::: ~ ._:1 1._;(:

•

, ,, . ,-

'. "70. In framing~tne estimates of cost, the

date from which a parti-II 'Scheme is likely to beintroduced and whether it" will be introdu~ed in fullfrom the beginning or" by,stages must be carefullyconsidered. A scheme-·cf new expenditure cannot beintroduced until provisi6n-"fot it has been included inthe Appropriation Act/ or until the necessary sanctionto the scheme has been accorded by the Government. Noaction which commits the·,Government to expenditureshould be taken in anticipation of thsir sanction.The period which may ,b. ,r~quired for preliminariesafter the receipt of the' Appropriation Act and theorders of the Government wi~lcdepend on the nature oft~e sb~eme. A new Off{ce'~c~~not be opened until the

: ::, ':',> • -~ J, ' .

"

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TAMIL NADU BUDGET MANUAL 77

..

personnel of the office is settled, a building rentedand the necessary furniture and equipment provided,while the opening of a new school t must in any casewait till the commencement of the school year. Inbrief, only so much should be provided in theestimates as will actually be spent in a particularyear~

)

•

•

•

I 71. Works.- Sch~mes relating to works must beaccompanied by sketch plans and approximate esti~ate5.

in all cases of works and schemes costing more thanR~.5 lakhs, preparation of detailed estimates shouldbe taken up only on issue of a Memo/Letter of Intentby the authority competent to accord administrativesanction to the schemes and works on receipt of whichaction should be taken to select a suitable site andarrange for its investigation by the Public WorksDepartment. The Public Works Department will thenprepare detailed plans, designs and estimates which.Jill be technically sanctioned by the . competent,authority in the Publ~c Works Department and submittedto the Government in the administrative Department for

taccording administrative approval. Grants or loans tolocal bodies for new works will not be consideredunless detailed plans and estimates have beensanctioned by the competent authority and unless theirnecessity has been established. The total estimated~

cost af the project, the time likely to be requiredfar its completion and the expenditure to be incurred

,each year should be stated in every case afterconsulting the agency to whom the execution of theproject is to be entrusted. If, as a result of theconstruction of new buildings any of the existing

~~buildings are likely to be rendered surplus, it shouldbe indicated how they are proposed to be utilised.

72. Loans or loans and gran~s.- Proposalsrelating to sanction of loans or loans andgrants-in-aid to local bodies -and other non-Government'institutions, private parties, etc., should not besubmitted to Government until the admissibility ofthe loan or grants-in-aid applied for in each case hasbeen fully examined with reference to any existing-

85/21--3AL

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78 TAMIL NAPUBUPGET MANUAL..•

. ·[1.'

Irules or orders or approved schemes. If the loan orgrants-in-aid applied for a new scheme or forexpansion of an existing scheme, it is necessary tosatisfy that full details have been worked out andhave received the approy?!: pf tne competent authority.Proper assessment of the latest financial position ofthe party concerned I's,'-r.' ,absolutely necessary todetermine whether:-

(i) Government aid is really called for;

•

,

be met( i i)

by the

. . . 11the balance o~,expend~ture, ~f any, ~n

party concerned from its own resources;

(iii) there is likely to be anyeffecting recovery of the loan proposedand the interest thereon. The terms andbe attached tD the prDposed lDan orshould be clearly mentioned; and

;.r.!.r,I

difficulty !nto be grantedconditions togrant5-in~aid'.

~ ~.;'1:.

( i v) in resp!¥'c;t;:, ,. D.f:<, lDans, the Demand~

Collection and Balance position Df loans already givento the institution musf~~pe~:9~cked up to see if theinstitution ~s regulaFj4~ ~.y~ent of principal andinterest.

73. The Education Department, Health and~

family welfare Departm~nt, the Rural DevelDpmentDepartment and Municip~l Administration and WaterSupply Department, Public WDrks Department and otherDepartments whiCh normal~Y. have institutions andpublic undertakings getti~g toans from Governmen~should each compile annually a list of the new schemes.in connection with which applications for loans orloans and grants have bee~ received~ It should be intwo parts :- one for schemes to be financed entirely ~

from loans and another for schemes to be financedpartly from loans and partly from grants. No schemeshould be included in the list unless the iDeal body'sability to finance th~ ~regu~red loans have been-,,~s.t,ab.lJ.s.hed. The sch'1'!1'1s~.l"!~J.l.be arranged Ln the

,

79THE TAMIL NADU BUDGET MANUAL

These lists should be in two parts-one forPlan schemes and the other for Non-Plan schemes.

Rs.

Loan(6)

Rs.

Total amountto be met fromState Funds

Grant(5 )

I

schemes to be financedpartly from loans.

Rs.

(4 )

RS.

Totalestimatedcost

Loan(10)

I

Nature Total Amountof the sanctioned of loanscheme cost required

(3) (4 ) (5)

Rs. Rs. Rs.

(3)

Natureof thescheme

Rs.

Balance to bemet in h,ture·years

Grant( 9)

(2)

Localbody

Balanceto be metin futureyears

(7)

(2)

Localbody

I

RS.

Loan(8 )

Rs.II - statement showingpartly from grants and

( 1)

Rs.Farm

Form I - Statement showing schemes to be financedentirely from loans.

Serialnumber inorder ofpriority

( 1)

Rs.

Amountrequiredin199 -9

(6 )

order of priority in the lists drawn up in the formsgiven below:-

Serialnumber inorder ofpriority

Amountrequired incurrent year

Grant(7)

------------

.1

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75. Schemes of new expenditure to beintroduced in the cOurse of the financial year:- Thedifferent classes of schemes of new expenditure tobe sanctioned in the course of a financial year, theconditions to be satisfied before such sanctions areaccorded, the financial procedure to be followedby the Secretariat Departments are detailed inc.hapter X.

74. When a scheme involving abandonment ofan existing item of revenue in whole or in part hasbeen considered as a Part II Scheme and provided forin the budget estimates of a year, or when provisionhas been included for a scheme of new expenditureeither in the Appropriation Act for the year afterconsideration as a Part II Scheme or in theAppropriation Act pertaining to the Supplementarystatement of expenditure and the scheme is notlikely to be introduced in that year,' it should bebrought forward as a Part II Scheme in connectionwith the budget for a SUbsequent year. Fa~ thispurpose," a scheme will be regarded as having beenintroduced during a year if the Government arecommitted to the expe,\diture or some part of itduring the year even though no expenditure isactually incurred or is likely to be incurred duringthat year. For instance, placing an order for plantor machinery or entering into a contract for theexecution of certain works would commit theGovernment to expenditure.


•

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'0

•

I

,

I

• 1 1

1I

I I I

80

.,; J "

CHAPTER V., '

c •.\

PREPARATION OF'THE'BUDGET BY THEFINANCE'DEPARTMET.

" ~ ,:CI 1,-: .. -." J. '

., .-'.·',,·,r· ii76. (a) Under~the rules made by the

overnment for the c6~veril~nt transaction of theusiness of the State Government and the instructionsssued thereunder; the Finance Department has been

"harged with the r~sponsibility to prepare a statement,f estimated revenue and expenditure to be laid before

~e Legislative Assembly in each year. Although the~aterial is supplied by the Heads of Department and

1ther estimating officers, the actual preparation ofhe budget and the estimates thus falls upon the'inance Department and it is solely the business and'esponsibility of that department to settle the~stimates of receipts and disbursements.

'~~

(b) The Heads of Departments and other

..stimating officers report precisely to Government byhe dates prescribed, their demands for expenditure

....~for the ensuing year under two heads - Part-I andlIIIIfart-II. Part-I Estimates provide for the normal

functioning of the depa~tments with reference to what....'are called "Standing Sanctions"r i~e. r all revenue

;based On existing laws, rules or orders and allexpenditure incurred by virtue of existing laws, rules

• ?r orders taklng into account the approved outlays ofche Union Planning Commission on the State Plansectoral outlays including that of earmarked.schemes/Minimum Needs Programme Components as well asthe allocated outlays for Centrally Sponsored and

----~Centrally assisted (equally shared) and other schemesassisted by autonomous bodies r etc. Proposals whichlinvolve a reduction Or increase in revenue otherwisethan in pursuance' of authorised codes, manuals, rules

__or orders and proposals inVolving "new expenditure"(see Chapter IV) are treated as Part-II Schemes,

77. on receipt of the departmental estimates,~he Finance Department will scrutinise the estimates'" "A item by item , with due regard to (a) the explanat.ions

,.'

•"


furnished by the estimating officers, (b) tlrecommendations, if any, of the administrati"departments concerned, and (c) the trend of actU<F'~~~~

expenditure during the current year and thr(~-----

preceding years~

78. In respect of the estimates of receiptJIIIIIIthe Fin~nce Department will take into account an..-----special information affecting the estimates for th.. _forthcoming year which it may possess and which hanot already been taken into account by the estimatinofficer, the Accountant-General or the administrativdepartment.

, .... __ .... __ ... -.

!"""."'''''.'''''''.

79. In respect of the estimates 0

expenditure, the Finance Department will make th,closest scrutiny of the items relating to fluctuatin,and non-recurring charges. That Department wilparticularly examine the estimates under such units a.,-----"s~laries··, and "Office expenses'l and, if necessarymodify them in respect of adjustments necessary O~I __

account of probable savings or on the basis of actual~of previous years. The Finance Department will,.....,...,... ,,1liscrutinise the estimates of fluctuating charges, iten-----by item and will not allow any increases which are not.....adequately cr satisfactorily explained. It will~

also scrutinise it€ms in respect of which no increasee......is proposed with the Object of effecting anylegitimate reduction which can be made. It willsimilarly scrutinise the estimates of non-reCurring~~~~

charges, exercising any amounts which .are nat covereo-by sanction and eliminating or reducing the estimatesfor the forthcoming year whe~e there is no reasonablecertainty that the amount estimated will be spent. Itwill also. scrutinise and make such corrections as arenecesoary in the classification of receipts anddisburs:'?lTIents ....

(i) under the various major heads t minorheads, sub-heads and detailed heads which are primary~,·~·~·g·g!units of appropriation; and

Iii)c.apJ.!;pl, plan

•

under votedand non-Plan,

••

and charged,etc.

revenue

•

and'-

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•

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•

80. In the course of the examination af theestimates, the Finance Department may find that inrespect of particular items further explanations orclarifications 1 etc., are necessary ~~fore theestimates can be settled. The necessity for suchfurther information being supplied to it with theleast possible delay needs no emphasis. The FinanceDepartment will normally address their enquiries tothe administrative departments of the Secretariatconcerned and the latter will furnish the requiredinformation where neCEssary after consulting ~he Headsof Department, etc. In Case where it is clear thatthe details will have to be obtained from the Heads ofDepartment and other estimating officers, the Finance

'Department may address their enquires direct to theofficers concerned' and 'send a copy to theadministrative department of the Secretariatconcerned. Final action l will, however, ordinarily betaken by the Finance Department only on the basis ofthe report received from the administrative departmentwhich should be complete in all respects and clear.The required information must be furnished to theFinance Department within the time allotted for thepurpose failing which the Finance Department willfinalise the estimates at its own discretion and theresponsibiltiy for any incorrectness of the estimateswill ultimately devolve on the officers of theadministrative departments concerned~

81. (a) As a result of its· scrutiny of eachdepartmental estimate the Finance Departme~t willadopt figures for each item included in the estimatesand will cause the estimate as so adopted to becompiled in the form it appears in the detailedestimates. Simultaneously the Finance Department willcommunicate to the Heads of Department and theAdministrative Departments of the Secretariatconcerned the figures adopted. by it. The Heads ofDepartment and the Administrative Departmentsconcerned may send immediately modifications to thefigures adopted by the Finance Department withsufficient reasons if they consider them necessary_

84'I 'lei


(b) The Co~mis~_i.oner for Revenue~dministration will send tQ the Pinance Department andRevenue Department on the 1st January a report on themodifications, if any, to beim~d~ in the estimates of

c, '. •

receipts under Land Revenue ,·)-n, ;the light of the latestinformation available togeiher with an account of thecauses likely to affect ~~h'e .coliections and a briefreview of the conditions l..n·"t~e State.

.....82. When all the departmental estimates have

been settled and detailed ~stimates'are completed inall respects, the Finance Depar-tment will re-examinethe estimates'as a whole and,will make such changes as

'. - - - . ~ ,-may be found to be necessary. due, for example l to

•• J •• • ,,'

overall ways and means po~~~~pn ~~F modification of thecontemplated central assistpnce, or any other financialfactor affecting the estimate's:"

'. L.: • ~~', ' , • ~ i

83. The Finance Department will consolidate. ' .. '

the copies of Part~lI :,~c:.J1.~~~5,. received from theadministrative departments.,pf. the Secretariat arrangethem in the order of pr~ority indicated by thedepartments and place them 'eq,rly, in January before theStanding Finance committ·e_e".J£or,~ its consideration.Simultaneously the Fina~~. ·.~Department will make

,.< ""~ -" >

available to the Standing Finance Committee theresources position as emerging from the departmentalestimates duly modified and as fixed by FinanceDepartment Part-I. The Standing Finance committeewill go through each Part-II Scheme, consider itsurgency with reference to the proposed State Plan, theneeds of Heads of Depa~tment, etc., and makes itsrecommendations to the Council of Ministers~

84. (a) The Finance Department will theninclude provision for all Part-II Schemes recommendedby the standing Finance Committee and finalise thebudget. A prelimina~y note by the Finance Secretarybased On the figures in the consolidated estimates(both Part-I and Part-II) together with the scheduleof new expenditure and the recommendations made by theStanding ~inance Committee shall then be placed by theFinance Department before the Council of Ministersordinarily ~n the third week of January. The Council...

"0

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THE TAMIL ~ADU BUDGET MANUAL 85

..

..

may then consider questions of policy arising from thebudget, such as fresh taxation, floatation of loans inthe market and approve with reference to the fundsavailable all or any of the Part~II Schemesrecommended by the Standing Finance committee. Themodifications made by the Council of Ministers shallthen be incorporated under the appropriate demands forgrants in the detailed estimates to be presented tothe Legislative Assembly. Other decisions taken by theGovernment affecting the estimates will also beincorporated therein. The Budget is then ripe forpresentation to the Legislative Assembly.

(b) For departmental purposes,Department also prepares in sepa~ate

"Detailed Estimates of receipts andunder deb't, deposits, etc., heads."

the Financevolumes, thedisbursements

•

85. The Finance Department may, at any stage,before the budget is presented to' the Legislative

•Assembly make such modifications in the estimate asmay be necessiated by the emergence or the discoveryof factors disturbing the estimates so far framed~

Such action is incumbent on the Finance Department inthe fulfilment of its responsibility to present theestimates as correctly as possible4

CHAPTER VI

PRESENTATION OF THE BUDGET TO AND ITS DISPOSALBY THE LEGISLATIVE ASSEMBLY

86. The budget liteeatuee which is suppliedto the Legislative Assembly at peesent consists of:-

(i) Annual Financial Statement;

(ii) Detailed Budget Estimates foe each Demand;

(iii) Detailed Budget Estimates of Revenue;

(iv) Statement of Posts and Scales of Pay;

(v) Inteoduction to Budget;

(vi) BUdget Memoeandum;

(vii) Appendices to the Budget Memoeandum;

(viii) Budget Speech;

I ix) Appendices to 'the· Budget SpeeCh;

87. (i) The Budget Speech is largely a policydocument where the Minister in-charge of Financereviews the salient features of the financialadministration of the year ending and the yearcommencing but the main purpose is to focus attentionon the policies and progeammes of the party herepresents and how rar they had been alreadyimplemented and how far they are to be furtherimplemented during the budget year.

(ii) The Annual Financial Statemen~ is aconcise document consisting of:-

••

...

•

(1)ExpenditureTamil Nadu.

General Statementon Revenue Account of

ofthe

RevenueCovernment

andof .

THE TAMIL NADU BUDGET MANUAL•

87

_'~'" ~ Ii-

st;)tern,e.l"1.t1>·,constitute the Budget.by four detailed statements also

vo-l;~m~,'h',-' .L

These twosupported

in the same

..

( II )DisbursementsTamil Nadu.

They are, printed

GeneralOn other

statementaccounts of

ofthe

ReceiptsGovernment

andof

( A)Tamil Nadu.

\,. .:,; ",':',Statement of Revenue of the Government of

Account(B) Statemeri1: ofof the Government of

,,ExpenditureTamil Nadu.

on Revenue

(C) statement of Capital Expenditure of theGovernment of Tamil Nq,qy':~ :;-' :r;;l,Y::,(

(D) statementaJ;,J\!"ceipts and Disbursements ofthe Government of Tamil Nadu an all other accounts,i.e. I under Debt., Deposit~, ~tc., heads and Loans andAdvances.

r.<(iii) The Budget. Memorandum is intended as ,a

guide for the study of the Budget. part I is a reviewof the financial position for the three Budget years.The summary of the rJi.nan:::i:a1 statement is giventhereafter for ready reference. Part II of the volumeanalyses and explains the figures of revenue undereach head of aCCQunt and,-;ofJ_tFxpenditure under eachdemand.. Part III consists of the list of schemes of, - ,

new expenditure for which provision has been includedin the Budget Estimates. '~.

(iv) The Appendices.~o the Budgetare brought 'out as a separate publicationyear 1974-75. The following statements arein the Appendices to the Budget Memorandum:-

•

". , ~

Memorandumfrom 1:heappended

•

• (a) Statement showing transactionsthe Tamil Nadu Famine Reli~f Fund from19B5-86. (Appendix I)

reiating tothe year,

" -t."

(b) Statement showi~g, the provision made forPuratchi Thalaivar M.G.R. Nutritious Meal Programme 4

88

•THE TAMIL NADU BUDGET MANUAL

(c) Statement showing the loans from theCentral Government (Appendix III).

(d) Statement of guarantees given by the •Government of Tamil Nadu (Appendix IV).

(e) List of schemes in respect of which the'amounts of the Revised Estimates sanctioned during theyear have exceeded appreciably the estimates asoriginally intimated to the Legislative Assembly(Appendix V).

(f) Statement showing the Assistance renderedto Local Bodies (other than Metropolitan Developmentof Madras) [Appendix VII.

( i )Metropolitan

Statement showing the expenditureDevelopment of Madras (Appendix VII).

for

(i) Statement showing(Appendix VIII).

Open Market Loans

(k). A.bstract of the recommendations of theFinance Commissions (Appendix IX}.

(1) Assistance to the Government StatutoryBoards, Corporations, Private Companies, etc., fromthe State Government (Appendix Xl.

( m)Liabilities

Statementand Assets of

showingTamil Nadu

certain(Appendix

•capitalXI) .

(n) StatementRevenue Account underetc., (Appendix XIII .

showing thecertain objects

expenditure onlike "Salaries" •,

•Tribal

(0) Statement showing the provisions made forSub Plan expenditure {Appendix XlIII. ,

(p)Special Self

Statement showing the provision madeSufficiency Scheme [AppendiX XlV).

for

All otherBudgets presentedintended for theand for regulating

publications such as Performancetb the Legislative Assembly areproper understanding of the Budgetthe voting on rlemands.

r ..'.-' ~ 1;'1 ~;'~


88. The following 'B~~get publications will besent to the secretary~;_~..· ' ~< ,Legislative AssemblySecretariat on the mC;;r-n'incj (at 7 a.m.)' of the datefixed for presentation of ,the.Budget for circulationto the members of the L':"e:gr~l~,t,:i";"e Assembly ;-

• ., ., - ". '~. > •

1. Budget Speech and~ppendices.. ' ." J., .._,., ,

2. Budget Memorandu,o',(without Budget at aglance) .

J. Budget at a glance.

4.•'1 _ ~';. ~ '.-.' ~,;: ,

The Annual Y_inancial Statement.,'. __ " ,L •• , --'

.5. A summaLy of Demands for Grants.

l. 1,-.r ,,~' [Il;

6. Introduction, :.1:,,0, B,:-,dget.

The Budget PUblications, viz., the Detailed, ...-

Estimates of Revenue and Detailed Estimates of Demandsfor Grants intended for supply to the melnbers of theLegislative Assembly wJ;ll ,qE!:: ~~nt to the Secretary tothe Legislative Assemb,ly, .atrout J days prior to the

· •• _ .... ,J. .,J." .'

date fixed for presentation of Demands for Grants inthe Legislative AssemblY+~c-:J ~,~

.") -:07£-'11.'

894 The proce?u~e.,.~~F~(~he presentation of theBudget to the Legislative Assembly and for itsdisposal is regulated by the Tamil Nadu LegislativeAssembly Rules relatLn~ to'financial business. Therelevant rules as in force at present have beenre-p["oduced in Appendix A... ~ ,',>'.',

•90.

Rules, thestages:-

AccordingBudget has

, _ .::. o· •.,

to the Legislativeto go through the

Assemblyfollowing

Ii) Presentation ~~ th~ Ltgislative Assembly4

,"L. I, ~·>·i·~r

( i i) General d~scy~.~,i.'?XI.

{iii) Voting on ;9~!TL;~-nds for Grants in theLegislati~~,Aesembly.


(iv) Introduction, consideration and passingof the Appropriation Bill in the Legislative AS5embly_

(v) Obtaining the assent of the Governor tothe Appropriation Bill.

91. on a day to be fixed by the Governor,which will ordinarily be towards the end of Februaryor early in March, the Minister in-charge of Financewill present the Budget to the Legislative Assemblywith a speech explaining the salient features of theBudget. On the same day the members of theLegislative Assembly will be furnished with copies ofthe Budget documents.

92. After presentation of the budget to theLegislati~e Assembly, the Finance Department willcommunicate to Heads of Departments and otherestimating officers the sheets of the Demands forgrants with which they are concerned. Copies of theDemands for grants will be sent to theAccountant-General, Tamil Nadu, the High commissioner£Qr India in London, the Accountant-General,Commonwealth Relations Office, London and the Auditor,Indian Accounts in the United Kingdom and Governmentof India and other State Governments, ResearchOrganisations, autonomous bodies and public libraries,as per the approved mailing list. Although provisionmay be included for schemes of new expenditure in theDemands for grants no officeL may take any action inre~ard to any such scheme which will have the effectof committing the Government to expenditure until the~ppropriation Bill lS passed and the scheme issanctioned.

9J. (a) The Speaker in consultation with theBusiness Advisory comm~ttee and the Leader of theHouse shall fix and appoint sufficient number of days ~

but not exceeding ten days for general discussion inthe Legislative ~ssembly and twenty-five days forvoting of demands for grants in the LegislativeAssembly. There will be no discussion on the day ofpresentation.

•

THE T~MIL N~DU BUDGET MANUAL

(b) The Chairman in consultationleader of the House and.Business Advisoryshall fix and appoint sufficient number ofgeneral discussion of the Budget.

91

with theCommitteedays for

94. On such days as may be appointed by, theSpeaker the general discussion begins in LegislativeAssembly on the budget as a. whole or on any questionof principle or policy involved therein. No motion isto be moved nor are the details of the budget to bediscussed at this stage further than is necessary toexplain the general principles and policies of thebudget. The Minister in-charge of Finance has ageneral right of reply at the end of the discussion in

•the Legislative Assembly.

95~ After the general discussion is over, thevoting of demands for grants is taken up in' theLegislative Assembly in accordance with the programmeapproved by the Speaker. A demand for grant is aproposal made on the recommendation of the Governor,tor the appropriation of funds for expenditure to bemet from the consolidated Fund of the State other thanthat charged. The amount required for chargedexpenditure are shown separately in italics and arenot subject to vote but can nevertheless be discussed.There is usually one Demand for grant in respect ofeach depa~tment, but the Minister in-charge of Financemay include in anyone demand for grants proposed fortwo or more departments or make a Demand for grant inrespect of expenditure which cannot read~ly beclassified under particular departments. Each Demand'for grant contains first a statement of the totalamount required, followed with details arranged by

~ major head, sub-major head, minor heads, sub-heads,detailed heads and sub-detailed heads. The Demand ismoved by the Minister in-charge of the SUbject ordepartment or by some other Minister deputising. forhim. The Legislative Assembly has power to assent orto refuse to assent to any demand or to assent to anydemand subject to reduction of the amount specifiedtherein. Motions can be moved to reduce any demand bya specified sum but not to increase or alter thedestination of a demand. Notice of such motions

85/21--4


•

should reach the office of the Assembly not later than3 p.m. on the day fixed by the speaker for eachDemand or group of Demands. Every such motion must beaccompanied by brief note explaining in precise termsthe purpose of the intended motion. When severalmotions have been given notice of proposing reductionsin the same demand, they shall be arranged anddiscussed in such order 'as the Speaker may determine.

96. On a day fixed by the Speaker befor~ thelast of the days allotted by him for moving of demandsfor grants, further demands for grants may be movedprovided that

(i) If they required for purpose which in theopinion of the Governor are of an emergent nature;

..

been(ii)

includedthey are for new matters which have notin the original estimates of the year.

Such demands shall be classified according tothe original demands for grants the details beingshown by detailed heads under each grant. It must beunderstood that all expenditure to be incurred in thecoming years should be foreseen and provided for -inthe Demands for grants presented to the LegislativeAssembly and that further Demands for grants will beaccepted only in very exceptional circumstances.

The Assembly may assent or refuse to assentany demand, or assent to a demand subject toreduction of the amount specified therein.

toa

•97. After the voting of all the Demands for

grants has been completed, an Appropriation Bill isintroduced to provide for the appropriation out of theConsolidated Fund of the State all moneys required tomeet (a) the grants made by the Legislative Assemblyand (b) the e~penditure charged on the ConsolidatedFund but not exceeding in any ca~e the amount shown inthe statement previously laid before the LegislativeAssembly. The debate on an Appropriation Bill shallbe restricted to matters of public importance Oradministrative policy implied in the grants covered by

•

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•

the Bill which have not already been raised while therelevant' demands for grants were under consideration.Article 204(2) of the Constitution of India prohibitsthe moving of any amendment to an Appropriation "Billwhich has the effect of varying the amount or alteringthe destination of any grant made by the Assembly ofvarying the amount of any expenditure charged On theConsolidated Fund~ The Governor's assent to the billis thereafter obtained, and when that has b~en given,the amount shown in the Act assented' to by theGovernor and the Schedule thereto become thesanctioned grants for expenditure under the variousDemands.

,98. Vote on Account-After the Budget ispresented to the Legislative Assembly towards the endof February, the general discussion thereon, voting ofthe demands for grants and the Legislation of theAppropriation Act are normally expected to becompleted by the end of March next so as to makeavailable the appropriation authorised for eachserv ice for the budgeted year right, from thecOmmencement of the year, viz., 1st April. But incertain circumstances, a longer time may be allowedfor general discussion, voting of demands and thepassing of the Appropriation Bill with the result thatit may not be possible to complete the Legislativework connected with the budget on or before the 31stMarch and it may be necessary to continue the work ina part of the budget year also. On such occasions, ,demands for advance grants in respect of the estimatedexpenditure for a part of the budget year ,may bepresented to the Legislative Assembly. Thereafter thedemands will be discussed and voted and finallypas'sed as an A.ppropriation Act in the manner laid downin Article 203 of the constitution of India.

Such advance grants are known as vote onaccount. After an advance grant is made by theLegislative Assembly, an Appropriation Bill relatingto the advance grant will be introduced. Theprocedure for discussion, passing of the Bill,getting the assent of the Governor, etc., will be thesame as in the case of any other Appropriation Bill .

•


In a year when Vote on Account is takeh, say,for on~-fourth of the Budget to enab~e the EXecutiveto im:u..."penditure for the first three months in theyear the Chief Controlling Officer Shall notdistribute mare than this proportion, viz., One-fourthof the demands eventhau9h finance Department may havesent BUdget documents giving prOVIsion relating to theful~ year. The balance, viz., three-fourths of theprovision should be communicated only after the mainAppropriation Bill is passed and duly communiCated(also vide paras 99 and 105 regarding distributionof Budget) •

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CHAPTIlR VII.

SUBSEQUENT ACTION IN RESPECT OF THE BUDGETAFTER THE BUDGET IS VOTED.

99. As soon ae the Demands for Grantsincludes in the Annual Financial Statement have beenvoted by the Legislative Assembly and the payment fromand the appropriation out of the· Consolidated Fund ofthe State of the sums voted by the Assembly and thesums charged on that Fund have also been authorieed bymeans of an Appropriation Act, the Finance Departmentwill intimate the same to all the administrativedepartments of the Secretariat and the Heads ofDepartment indicating at the same time whether thedemands have been voted in toto or whether any amounthas been omitted or reduced by the Assembly, eitherthrough substantive or token cuts and the purposes orobject underlying each such cut. The administrativedepartment of the Secretariat and the Heads ofDepartments will be responsible for taking necessaryaction immediately for communication of budgetallotments to other controlling and disbur~ing

officers under them. The allotments placed at thedisposal of each such officer for expenditure, whethervoted or charged will be intimated to theAccQuntant-General and the High Commissioner forIndia, London also. The Chief Controlling Off~cers orthe Heads of Department, as the case may be, and theadministrative departments of the Secretariatconcerned shall be responsible to ensure that theexpenditure is kept strictly within the authorisedappropriation and where cuts have been made by theAssembly in the demsnds to ensure that the purpose orobject underlying the cuts is duly fulfilled. . Theyshould carefully ~emember that it is not p~rmissible

to increase or prDv~de for expenditure on any item theprovision tor which has been specifioally reduced ordisapproved by the Assembly through a substantive or atoken cut.

100. The administrative departments will alsoensure that the new. items of expenditure for whichprovision has been included in the budget as passed bythe Legislative Assembly are sanctioned by them assOOn as ppssible. The orders will be issued with the


concurrence of the Finance Department except where th~

Finance Department may have delegated the necessaryfinancial powers to the admini9trative departments. Acopy of each such order should be sent to theAccountant-General and to the Finance Department.

101. If the variations between the figures inthe Budget laid before the Legislative Assembly andthose in the Appropriation Act are sufficiently large,the detailed estimates will be reprinted and copies ofthe revised edition will be supplied to thedepartments of the Secretariat and theAccountant-General! Tamil Nadu 1 etc.

102. The Finance Department will supplycopies of the Budget literature to theAccountant-General, Tamil Nadu and while doing so willcommunicate to him cases in which a demand beingpresented to Lt, the Legislative Assembly has declinedto provide funds for expenditure on a particularpurpose. The Finance Department will also bring tothe notice of the Accountant-General any resolution orany other motion which has been passed by the Assemblyexpressing direct disapproval of expenditure on aspecified purpose.

103. The FLnance Department will also supplycopLes of the Budget lite~ature to the Comptroller andAuditor-General of India, New Delhi, variousMinistries of the Government of India, Pl~nning

Commission and the Other State Governments.

104. The Finance Department will communicateto the High Commissioner of India, London, ~nd theDirector of Audit, Indian Accounts in the UnitedKingdom, the grants finally approved for expenditurein England under the relevant major, minor, sub-headsand detailed heads of account with which the HighCommissioner is concerned.

105. It is absolutely necessary that actionis taken by the Heads of Departments and otherControlling Officers even at the beginning of the yearto distribute the al~ocations made in the Budget among

•


• •

the field/subordinateexpenditure in ordercontrol of expenditurefollowing.· heads:-

officers andto have realespecially in

to watch theand effective

respect of tl"\e

"

1. Office Expenses (including Telephonecharges);

2. Travel expenses;

3. Motor Vehicles (Maintenance);

4. Machinery and Equipment;

5. Tools and Plant;

6. Major works/Minor works;

7. Other charges;

8. Other non-salary items; and

•

•

9. Provisions in respect of schemes whichhave been sanctioned as Part II Schemesby the Stan~ing Finance Committee andvoted by the Legislative Assembly.

·In respect of the above items, steps should betaken right from April of every year to restrictexpenditure to the levels indicated in the BudgetEstimates.

In respect of non-salary items of expendituredetailed above, strict instructions should be issued"to field subordinate officers to limit the ex~enditure

within the Budget Estimates and a copy of theinstructions should be submitted to the GovernmentData Centre and Government in Finance andAdministrative Departments by 15th April of every yearalong with the Statement giving the quarterwisedistribution, if possible, of Budget provision inrespect of non-salary detailed heads. Distributionstatement in respect of the non-salary items may besent to Treasury Officers/Pay and AccountsOfficers/Sub-Treasury Officers by the Heads of


• Department or District reconciliation Officers sothat the Treasuries can pass the bills of each drawingofficer with reference to provision earmarked for thedrawing officer. ~

In respect of non-salary items listed above,all Controlling Officers/Estimating Officers may keepback a reserve of 10 per cent to 15 per cent of thetotal Budget provisions and distribute the balanceamong their subordinates. This reserve can bereleased at the time of fixing the Revised Estimatesto meet the increases during the year which were notanticipated at the time of finalising the Budget andalso the absolutely necessary increased demands ofcertain field officers at the end of the year. Indistributing allotments, care must be taken tointimate the allotments, with complete accountsclassification of each sum allotted, i.e~, the major,sUQ-major, the minor, the sub-head, the detailed headand the sub-detailed heads.

During the years when vote on account istaken, distribution statement to the field officers,treasuries, Government Data Centre, Finance Departmentand Administrative Department may be for the first fewmonths only depending on the vote taken initially.

106~ It is necessary that the communicationof sanctions and distribution of grants is effectedwith the least possible delay. Every effort should bemade to complete this work before the end of April.For ~his purpose, the I administrative departmentsshould prepare necessary draft Government orders etc.,immediately after the connected Demands for grantshave been voted by the Legislative Assembly withoutwaiting for the final passing of the Appropriation Actand the formal intimation of the budget allotments bythe Finance Department. The draft should be referredto the Finance Department for concurrence where thisis necessary and kept ready with fair copies for issueearly in April.

• •

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107. Sometimesschemes or item~ of new

proposa16 forexpenditure are

certainreferred

newto


the Finance Department so late in the year that it isnot possible for that department to - examine themcompletely in detail. At the same time, such newschemes or items may be considered to be 60 urgent andessential that the inclusion of necessary provisionfor them in the Budget cannot be postponed. Pendingthe examination of all relevant details, the provisionfor these items may be allowed to be included in theBudget as a special case. Such provisions are in a •sense lumpsum provision although they are not to betreated as such and all such items must necessarily beexamined thoroughly both in the AdministrativeDepartments and in the Finance Department beforeexpenditure sanction can be accorded. Such furtherexamination should be started and completed well intime after the presentation of the budget so as toenable the Administrative Departments to issue thenecessary orders as early as possible after thepassing the budget. The Administrative Departmentsshould maintain a list of all such items and see thatthere is no delay in the issue of orders on thisaccount.

108. In the case of permanently sanctionedexpenditure e.g., pay and allowances of permanentlysanctioned posts, no fresh sanction is necessary andthe sanction once given remains valid unless the fundsnecessary to make the sanction operative have beenspecifically refused either' by the LegislativeAssembly or by Government. It is therefore, the dutyof the Administrative Departments of the Secretariatto inform the disbursing officers concerned throughthe Heads of Departments, as soon as possible afterrefusal of funds by the Legislative Assembly or assoon as a decision has been taken by Government, asthe case may be of all cases in respect of whichsanction to a particular expenditure has beenterminated. In the case of the expenditure sanctionedfor a specified period, the sanction becomesinoperative after that period hae expiredw Thedisbursing officers should, therefore, move Governmentthrough proper channel in good time for extension ofthe term when this is considered necessaryw Thedisbursing officers should be informed of aI-I cases in

, .,,


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respect of which the sanction is not to be renewed.It is necessary that all s~ch orders should becommunicated well in time, because in the absence of adefinite order to the contrary they may continue toincur, in anticipation of sanction of the competentauthority applied for expenditure which willconstit~te a financial irregularity •

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\CHAPTER VI II •

REVIEW OF RECEIPTS AND CONTROL OF EXPENDITURE .

SECTION 1 - REVIEW OF ·RECEIPTS.

109. Subject to any special arrangement thatmay be authorised by government with respect to anyparticular class of receipts, it is the duty of thechief Controlling Officers to see that all sums due toGovernment or regularly and promptly assessed,realised and credited into the Government account.The Chief Controlling officers should accordinglyarrange to obtain frDm their subordinates monthlyaccounts and returns in suitable form claiming creditfor so much paid into the Treasury or otherwiseaccounted for and compare these with the statements oftreasury credits furnished by the Accountant-General,Tamil Nadu, to see that the amounts reported ascollected have been duly credited to Governmentaccount. A list of Chief Controlling officers andSubordinate Controlling Officers is given inAppendiX~D. If wrong credits come to the notice ofthe- Controlling Officers they should at once informthe Accountant~General with a v~ew to correct theaccounts. If any credits are claimed but not found inthe account f enquiry should be made first of t,hedepartmental officer9 concerned. where thedepartmental registers are not maintained under thedepartmental rules, the heads of offices must maketheir own arrangement within the office to ensure thecorrect and complete report of the receipts.

110. The following instructions should be,borne in mind:-

(i} T~e departmental Controlling Officer'saccount should not be compiled from returns prepared

• by ,the Treasury. But the Treasury Officer is in somecases required to verify returns for submission toDepartmental Controlling Officers.

(ii) The amounts collected should at once bedeposited into the treasury and in order to minimise

102 THE TAMIL NADO BUDGET MANUAL

chances of discrepancies between the treasury figuresand departmental figures, the chalans wcth whcch moneycs remitted to or deposited into the treasury shou~d

bear full and correc~ classcfccatcon of account.

(iii) The cOllections should on no account beutilised for meeting any expenditure, except whereutilisation of departmental receipts for departmentalexpendcture has been specifically permitted byGovernment.

{iv) Mistakes in classification should bereported by means of foot notes in the next returns anaction taken where necessary for eorrectiOh Ofaccounts in accordance with the prescribed procedure.

IiI. No amount due to Government should beleft outstanding without sufficient reason and withoutbringing the matter to the notice of the competentauthority within a reasonable time. Where any duesappea~ to be irrecoverable, a full report must besubmctted to the competent authority and orderssought. If ct is found that any dues have becomeirrecoverable due to failure on the part of anyGovernment servant to take timely action withoutsuffiCient reason, the official at faUlt m~y, afte~

following the prescribed procedure, be called upon tomake good the loss in such manner as the competentauthority may deem fit.

112. Unless specially authorised by any ruleor order made by competent authority; no sums may becredited ae revenue by debit to a suspense head; thecredit must fdllow and not precede actual realisation,

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113. The responsibility for keeping a proper"watch on revenue receipts primarily rests with theChief Controlling Officers. The Accountant-General •also keeps a watch and immediately reports to theFinance Department any large incresse or falling offih those receipts~ Any large differences that arelikely' to arise in actuals as compared with theestimates should also be reported by him as sOOn as

THE TAMIL NADU BUDGET MANUAL 1()3

•

reason a~i8es for expectin~ them. TheAccountant-General, Tamil Nadu, is required to submitto the Finance D~partment a monthly account shOwingthe receipts and exp~nditure of the Government du~ing

the month and to the end of the month the first of thesecond following month.

114. The Chief Controlling Officers must Seethat Claims in respect of dues from other GOvernmentsand local bodies, etc., a~e made ~nd recoverieseffected as ~arly as possible.

115. TO ensu~e that all periodicaladjustments between the various departments of theGovernment are properly and p~omptly made, theAccountant-General should maintain reco~ds showing(i) all periodical adjustments that are usuallyrequired to be made; (li) the month's aceount inwhich the adjustments should. be made; and (lil) theactual date of all adjustments are made before theclose of the final accounts of the yea~.

116. (a) lJnde~ the 'ramil Nadu GovernmentBusiness Rules and Secretariat Instruetions, FinanceDepartment is responsible' for watching theGOvernment's balance and their ways and meansoperations. To enable that department to dischargethe responsibilIty, the Accountant-General is ~equired

to furnish to it a monthly account of the StateGovernment's transactions. The Accountant-GeneralinfOrms the Finance Department 'immediately of theappearance of al'\Y. appreciable excess in theproportionate outlay under any g~ant, any largedifferences that are likely in the actuals as comparedwith the estimates as soon as reason arises forexpecting tham.

• (bf The Chiaf Controlling Officers of receipthaads.ralating to cOllectiol'\ of taxes also sent to theFinance bepartment monthly Statemel'\ts of receipts withreasons for appreciable increase or fall in receipts.

Thereceipts and

Finance Departmentexpenditure of the

makes a ~eview of theGove~nment every month


and takes appropriate stepsbalances for the ways and means

to haveoperations.

s~fficient

SECTION II - CONTROL OF EXPENDITURE.

117. (a) The a~thority administering a grantis responsible for watching .the progress ofexpenditure under its control and for keeping itwithin the sanctioned grant or appropriation. Inorder that the control of departments over theexpenditure may be effective and real and theControlling Officers may be in a position from monthto month to estimate the likelihood of savings andexcesses over grants and appropriations a properbUdget control system is to be followed by the methodsindicated below in order to ensure a good selfregulations departmentally:

. (i) proper formulation of estimates;

(ii) proper communication of appropriations tofield officers and treasuries;

(iii) prompt accounting and reporting ofreconciled accounts by treasuries anddepartments;

'(iv) analysis of trends of expenditure andapplication of mind to regulatibn ofexpenditure;

(VI communication and implementation ofdecisions to regulate expenditure;

(vi) review implementation systematically;(G.O.Ms.No.8l8,Fin (BGI), dt.29.10.90).

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The procedure outlined in theparagraphs should therefore be followed:-

following •

(b) The Chief Controlling Officers willbe responsibl~ for controlling expenditure fromcharged appropriations placed at their disposal

•

alsot~

and

THE T~MIL NADU BUDGET MANUAL 105

will exercise control through the subordinateControlling officers, if any, and the disbursingofficers subordinate to them. Such control must beexercised with reference to the appropriat~ons as they

~ stand from time to time.

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118. As soon as the grants, have beencommunicated to the Chief controlling Officers, thefirst duty of these officers is to compare' carefullythe amounts actually provided for expenditure in thesegrant with amounts which had been proposed in thedepartmental estimates. A note must be taken at onceof all reductions made under various units ofappropriation and ways and means devised, right at the

.beginning of the year, to ensure that the expenditureis restricted to the amounts f actually provided.Reductions are mostly made to enforce economy inexpenditure. It would be improper on the part of theadministrative departments and their subordinateofficers to start incurring expenditure without firstcarefully re-examining the position with reference tothe amounts actually provided. Quarterly statement ofexpenditure under each head of amount must be preparedso as to watch, expenditure in comparison to amounts t

actually provided_

119. The sheets of the detailed estimatesrelating to the demands for grants which arecommunicated to a Chief Controlling Officer show thebudget estimates as finally fixed for the variousheads of account with which he is concerned. Figuresare entered not only against the various detailedheads of appropriation but also against· thesub-detailed account heads of which they areconcerned. Except in regard to the heads of accountspecified in Appendix - E, the amount provided in thebudget estimates for each unit of appropriation shouldbe regarded as an appropriation placed at the disposalof the Chief Controlling officer. In the exceptionalcases, the appropriation is retained in the hands ofthe Government in the administrative department of theSecretariat entered against each item.

120. Thecontrolling Officer

I

duties and responsibilitiesbriefly are (See also para

of alOS) -


(i) to ensure that the grant placed at hisdisposal is expended only on the objects for which ithas been provided I keeping in"view the standards offinancial propriety;

(ii) allotment must be made drawing officerwise after reserving some cushion in non-salary items

. and this must be intimated to Data Processing Centreand Chief Controlling Officer.

(iii) to keep the expenditure within thesanctioned grant;

(iv) to keep the expenditure under aparticular unit of appropriation as far as possiblewithin the sum allotted under that unit, and wherethis is not possible to meet the excess by effectingsavings in the sums allotted to him under ather unitsand sanctioning re-appropriation which may be withinhis competence in accordance with the rules containedin Chapter IX;

(v) to move the competent authority in proper, time to provide additional funds either by

re-appropriation or through supplementary estimates,whenever an excess over the total grant placed at hisdisposal is expected by him as unavoidable or when hedesires to incur some new expenditure~

•

(vi) to surrender appropriationsthereof which are only not likely toduring the year as soon as lapses orforeseen; and

or portionsbe requiredsavings are

Ivii) tohis subordinatesregulations.

ensure theof all

observance byfinancial

-

himselfrules

andand

•

121. The responsibilities mentioned above ofa Chief Controlling Officer attach equally to aSubordinate Controlling Officer and a DisbursingOfficer, In addition a disbursing officer must ensurethat the condftions preliminary to the incurring ofexpenditure are satisfied namely that the sanction of

,

1


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•

the competent authority exists and funds to cover theexpenditure fully have been placed at his disposal.The possibility of any excess expenditure over theallotments made to him must foreseen and intimation ofthe likely excess along. with the reason for thisshould be sent to the Chief ControllingOfficer/subordinate Controlling Officer concerned insufficient time to enable the latter to arrangeadditional funds if these are to be allotted at all.Every Chief Controlling Officer and Subordinate

.Controlling Officer in respect of the expenditureincurred by himself is' in the same position asdisbursing officer. •

122. An appropriation is intended to coverall charges including any outstanding liabilities ofpast years to be paid during the current year or to beadjusted in the accounts of that year. When aprovision is originally proposed in the departmentalestimate or when an application is made subsequentlyin the course of the year for additional appropriationthe amount asked for should therefore be inclusive ofall anticipated liabilities. An appropriation isoperative until the close of the financial year whenany unspent balance lapses and is thus not av~ilable

for unutilisation in the following year. The accountsof each financial year are however kept open till Julyof the following year so that as far as possible, allthe transactions of the year may be entered in theaccounts of the year. If it is not possible for anyexpenditure to be booked in the accounts of the yearto which it relates owing to the fact that the actualincidence thereof is under dispute it ought to becharged to the accounts of the year in which thefinancial decision is taken.

•

123. (a) A Chief Controlling Officer has t~

see that the expenditure under each unit ofappropriation is kept within the appropriation and,therefore, he must keep a constant watch over theprogress of expenditure and also know what liabilitieshave been incurred but not yet paid. It is possibleto control the expenditure in either of the two·following ways,-

>

108 THE TAMIL NADU BUDGET MANUAL,h. ,,'

(i) by keeping the appropriation in his ownhands watching the actual, .expenditure against theappropriation for the state' a'~ 'a .whole;

'. ~

(ii) by distrtibuting the appropriation amonghis Subordinate Controlling ," OfJicers, each of whomwill in turn distribute the appropriation at hisdisposal among the disbursing officers subordinate tohim and" making each such authority responsible forwatching expenditure against the appropriationallotted to him. _,.

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(b)Officer isexpenditurelatter Casesubordinate

In the former, the Chief Controllingwholly resp~n6~~le for watching theagainst the appropriation, whilst in thehe shares this :~e~_ponsibility with his

of fieers.

(C) As a gener4~·'r;.ule;. expenditure based onsanctioned scales e.g~1 pay of permanentestablishments should be watphed for the State as awhole, Where the amount actually spent dependslargely on decision to be made by the. disbursingoffiCers, e.g., Travel expenses (other than fixedtravelling allowances) and ·,n.on-recu·rring OfficeExpenses. It is better to distribute theappropriation among the disQ\,lJ"sing officers. Thechief Controlling Officers should retain in their ownhands, the appropriatiol")s_f·o.r li.h8 following heads ofaccounts:-

..(il 2030, Stamps and Registration

01 stamps - Judicial -

101 Cost of Stamps. - \:c

I. Non-Plan-

,:;;;; ~- "AA. Supply fromCentralStamp Stores

, ."

•. 2030 01 101 AA 0005

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t

24. MaterialsSupplies

and2030 01 101 AA 2405

•I

•


1. Manufacturingcost payable toNasik Press 2030 01 101 AA 2414

102 Expens'es on saleof Stamps-

r. Non-Plan-"

AA. Sale of Court-fee Stamps • • 2030 01 102 AA 0003

34.0ther Charges ·, 2030 01 102 AA 3402

1. Discount onSale •. 2030 01 102 AA 3411

02 Stamps-Non-Judicial-

101 Cost of Stamps-

I. NOll-Plan-

109

•

AA. Supply fromcentralStamp Stor!!s .• 2030 02 101 AA 0004

•

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02 Stamps-Non-Judicial-

102 Expenses on saleof stamps

1. Non-Plan-

AA. Madr-as City 2030 02 102 AA 0002

"34.0ther Charges • • 2030 02 102 AA 2404

1. Discount on :saleof 'stamps ·. 2030 02 102 AA 3410

AB. Moffussil •• 2030 02 102 AB 0000

41.0ther Discounts •• 2030 02 102 AB 4104

85/21--4AI 'I,


(ii) Under all major heads of expenditure-

(a) Salaries - pay - Permanent.

(b) Other Allowances - Cost of passages.

(c) Grants-in-aid.•

•

(d) Charges -, payable to Governments,departments and others, otherwise a Chief Controllingofficer has full discretiOn to decide in each casewhether he will retain the appropriation in hie ownhands or distribute it among his subordinates. Whenthe appropriation is distributed, it is desirable forthe Chief ContrOlling Officer to retain in his ownhands a reserve of 10 per cent to 15 per cent of thetotal budget provisions in respect of non-salary itemsfrom which he can sanction-additional amounts askedfor by subordinate Controlling Officers when necessaryand each SUbordinate Controlling officer shouldsimilarly retained a small sum in his own hands sothat he may sanction when necessary, small additionalamount!! asked for by" -the disbursing officerssubordinate to him.

NOTE,- The distribution of appropriation bythe Chief Controlling officer among his SubordinateControlling Officers and the latter among thedisbursing officers subordinate to them should be madeimmediately on receipt of the first edition of Budgetsheets and should be completed before the 5th Apriland 20th April respectively of each year. Thedistribution should be altered, if necessary withreference to the variations if any in the finaledition of the Budget (i.e. the death grants theSchedule to the Appropriation act). The - alterationsmade should be communicated to the officers concernedwithout delaY.

124. To facilit'ate control, departmentalaccounts are maintained by the Chief ControllingOfficers and the progressive actuals month by monthare reconciled with those entered in the books of the~s~o~ntant-General.

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I

THE TAMiL NADU BUDGET MANUAL

•111

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'...

12S. (a) Every Disbursing officer willmaintain a register of expenditure under each detailedhead of account with which he is concerned in Form C•The allotments communicated by the Controlling officerat the beginning of the year will be noted in thisregister in red ink under each detailed head in thespace provided for the purpose. if the allotmentagainst any unit is increased or decreased by theControlling Officer subsequently, the amount of theallotment will be corrected in the register by plus Orminus entry in red ink. Should a diSbursing officerreceive information from his Controlling Officer thatany particular item has been misclassified, he willcorrect the accounts of expenditure and the availablebalances of the allotments by means of plus or minusentries in red ink. As soon as a bill is passed atthe treasury it should be posted in the appropriatecolumns of the register against the treasury distric~

in which the payment is made. in the case of pay andallowances of village establishments cattle poundcharges and loan disbursed under the Land ImprovementLoans and AgricUlturists Loan Acts, it is sufficientto copy the monthly totals from the records maintainedby the disbursing officers. The adjustments if anymade oy the Acco~ntant-General and intimated to thedisbursing officer should be entered on receipt of theintimation.

(b) After the Close of each mcnth, everydiSbursing officer should after s4ch reConciliationwith the treasury figures as may be prescribed by theChief ContrOlling Officer in consultation with the~istrict Treasury Officer, forward to the ControllingOfficer immediately superior to him an extract of hieaccount in Form C omitting the detaile leading up tothe district total against number iV.

126. SubOrdinate Controlling officersRegister - The subOrdinate Controlling Officer shouldconsolidate in Form 'D' the figures in his ownregister of disbursements (Form C) and the figurescontained in the extracts of accounts received from"the disbursing officers subordinate to him. Thedisbursements appertaining to each Bub-head 0t

.--- _. ..~

,,.,


appropriation or detailed account head should begrouped by district treasury. The SubordinateControlling Officers should after such reconciliationwith the treasury figures as may be prescribed by theChief Controlling officer forward an extract of hisregister in Form D to the Chief controlling Officershowing only the totals against each serial numberexcept serial numbers, VI and IX which should beomitted.

12/. The reconciliation of departmentalfigures with the booked figures in the office of theAccountant-General has two objects viz -

•

•

. Ii} to ensure that theare sufficiently' accurate todepartmental financial control;

departmental accountssecure efficient

and

(ii) to' secure the accuracy of themaintained in the Accounts office from whichpublished accounts are compiled.

accountsthe final

.~

128. Reconciliation by disbursing, etc.,Officers - ,All disbursing Officers and SubordinateControlling Officers should reconcile theirdepartmenta~ figures with the treasury figures beforeOfficers in the manner prescribed for SubordinateControlling Officers. He should send an assistant ofhis office to the Accountant-General's office with thedepartmental registers every month on a date fixed bythe Accountant-General. The assistant, should withthe a5sistance of the Accountant generalrs staff t

compare the departmental figures with those recordedin Accountant-General"s books. A statement ofOfficers in the manner prescribed for SubordinateControlling Officers. He should send an assistant ofhis office to the Accountant-General's office with thedepartmental registers every month on a date fixed bythe Accountant-General. The assistant, should withthe assistance of the Accountant general's staff t

compare the departmental figures with those recordedi.n Accountant-General "s books. A statement of~discrepancies will be prepared, in duplicate andanalysed in twq columns, one showiryg the adjustments,to. be made in the Accountant-General's books and the

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other showing the adjustments to be made by the ChiefControlling· Officer. The Accountant-General's officewill keep one copy, the assistant will take the otherback to his office, where necessary adjustmentsshauld be effected in the departmental registers. Thechief Controlling Officer shauld· inform theAccountant-General that ~his has been done. TheAccountant-General will likewise make the necessaryadjustments in his books and inform the ChiefControlling Officers that he has done so. The lattershould then send .a. :' ~ertificate to theAccountant-General stating that the figures in hisregisters have been reconc'iled" with those in the booksof the Accountant-General.

Ib} If the Chief Controlling Officer's officeis outside Madras, he should send to theAccountant~eneral on or before the 28th day of themonth following that to which. the accounts relate, anextract in Form D showing, the figures under each minorhead, sub-head, detailed head and sub-detailed head,except the adjustments . communicated by theAccountant-General ·and· the"~~igures against serial

~ I .--"

number IX to XI. The .Accountant-General will check'the figures with his own accounts and he and the ChiefControlling Officer will be jointly responsible forthe reconciliation .of.d'iff~re~ces, in the figures andthe rectification of discrepancies in classification., ,

130. In respect of appropriations under thecontrol of the Commissioner for GovernmentExaminations, against" wh~ch:~ills are drawn by bothofficials and non-officiais: the Commissioner will. .control the expenditure by making a reduction of theappropriation by the amount of each bill countersignedby h'im and by obtaining the":accounts of each monthfrom the Accountant-General· not later than the 28th ofthe following month. .

•

,The

Secretariatcontroll ingthe Members

85j21--4C

l

Secretary of ..will follow th~

.the expenditure onof the Assembly.

,

Legislative Assemblysame p~ocedure in

the Travel Expenses of


131. Accountant-General's adjustments.-TheAccountant-General will inform a Chief controllingOfficer of all expenditure for which the latter isresponsible and which has been adjusted in theaccounts either by the Accountant-General himself asin the CaSe of inter-departmental adjustment orthrough Centrl Accounts Section of the Reserve Bank ofIndia, Nagpur (e.g., Inter-Governmental adjustments)or through the Accountant-General, General revenues(e.g., expenditure in England). the Chief ControllingOfficer wile enter the adjustments directly in his ownaccount in form C or will communicate them to hissubordinate officers for entry in their accounts,according . as the charge is one for which he hasretained the appropriation or one for which he hasdistributed the appropriation to his subordinateofficers. Care should be taken to avoid doubleentries in 'respect of adjustments. •

•

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132. (a) the Chief Controlling Officer shallkeep a separate and careful watch on important butoccasional items af expenditure (e.g., purchase ofclothing and equipment and arms and ammunition for thePolice force, machinery and equipment and medicinesfor hospitals and dispensaries and foodgrains, etc.,for jails). Such expenditure is incurred occasionallyor at irregular intervals throug~out the year andwatching· the monthly progress of expenditure is notappropriate in such cases. He will decide for himselfwhat suitable method he should adopt to watch suchexpenditure and keep control over it. In some caseshe may prefer to keep the entire grant in his handsand direct the disbursing officers to apply forallotments when they wish to incur expenditure. Inother caSes he may distribute .allotments and merelyask tne disbursing officers to report the expenditure t

as Boon as they incur it separately from the monthlyaccounts of other expenditure. Whatever method headopts, it is essential that he should keep himself •fully informed from time to time not only of theexpe~diture already incurred but also of theliabilities incurred which have to be met out of thesanctioned grant.

I( 1


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,

(b) The Chief Controlling Officers and theEstimating Officers are supplied every month with theactuals for the month and progressive total upto themonth by the Government Data Centre. They shouldverify the departmental actuals with the GovernmentData Centre actuals and intimate any discrepancy' orer~or to the Director, Government Data Centreimmediately to enable the Government Data Centre tocompile correctly in the final statement for theconcerned month. These tallied accounts should enablethe Chief Controlling Officers to exercise propercontrol over expenditure. [G.O.Ms.No.BlB, Finance(EG.I), dated 29.10.91].

(c) Reconciliation of loans ana advances"....TheAccountant-General authorises a list of heads ofaccount to be operated in the receipts and expendituresides of loans and advances sections of TreasuryAccounts. The authorisation is issued to all TreasuryOfficers and copied to the Heads of Departments. Thedetailed heads of account for which budget provisionsis rupees one lakh or more, or for which outsideassistance is obtained are authorised by theAccount-General to be operated in the Treasuryaccounts. In respect of the detailed heads which arenot authorised by the Accountant-General, thetransactions coming under them will be accommodatedunder the head "Other loans': provided under the sainegroup head of account. In these cases theDepartffiental Officers should maintain separatedepartmental accounts for each scheme separately toenable them to reconcile their figures with. those ofthe Accountant-General.

~ 133. An analytical review on the reconciledaccounts month by month is to be made by the ChiefControlling Officers pinpointing the excessiveexpenditure to subordinate controllingofficers/Disbursing Officers with the firm action onthem wherever necessary in order to avoid Treasuryappropriation Control System. [G.O.Ms.NO.8l8, Finance,(BGI), dt.29.10.91]. If the Chief Controlling Officerfinds at any stage that the expenditure is progressingtoo rapidly, he should promptly take such steps as he

116 THE ,TAMIL NADU BUDGET MANUAL

may consider necessary to restrict further expenditureso that the sanctioned ~~an~ is not exceeded.

,

134. The functions of the administrativedepartments of Secretariat in respect of control ofexpenditure (except in those cases in which theexpenditure is controlled by the Secretaries toGovernment) are generally supervisory and it isundesirable that they should assume any of the directresponsibilities which devolve properly on theControlling and Disbursing Officers. They will,however, take a quarterly review on the implementationof the budget control system with reference to theallocations of appropriations made to the Heads ofDepartment under their control and give directions forits adherance. [G.O.Ms.No.818, Finance, (BG.Il, dated29.,10.91]. They will, either on the report of any headof a department subordinate to them or at the, instanceof the Finance Department or the Accountant-General oron their own initiative take any action which may benecessary in the general _interest of economy or tocheck extravagance or ~o obviate excesses overallotments. 'They will also take' action when necessaryto restrict expenditure:"and to investigate the causeof extravagance and excess and also to make outsuitable punishment, after observing proper procedureto the officials found to be at fault, to prevent therecurrence of any irregularity or impropriety inexpenditure.

135. (al For the heads specified in AppendixE, the expenditure will be watched by the Secretary tothe Government in the Department concerned with theassistance of monthly 'actuals received from theAccountant-General. Where only adjustments and n6direct cash payments are'made under a head of account;e.g., items (i), (ii), (iii'), (ix), etc., in Appendix(E) or where the Accountant-General audits each,individual payment, it 'will be sufficient if themonthly actuals received from the Accountant-Generalare examined for the purpose of obtaining additionalappropriations or surr~ridering amounts not requiredfor expenditure.

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(b) In regard to the other heads of accountlisted out in Appendix 'E' excepting grants-in-aidunder "2059 Public Works", "2210 Medical and PublicHealth", "2216 Housing" and "3054 Roads and Bridges"the departments of the Secretariat should check themonthly actuals of expenditure received from theAccountant-General with reference to the standingsanctions or other orders issued by the Government orby obtaining departmental figures from subordinateauthorities. The procedure prescribed in paragraph123 for the reconciliation of the Chief ControllingOfficer's figures should, as far as possible; befollowed and the correctness of a~tuals should beverified every month.

(c) For grants-in-aid under "2059 PublicWorks", "2210 Medical and Public Health", "2216Housing" and "3054 Roads and Bridges" theAccountant-General will send a statement of actuals inForm 'E' not later than the 22nd of each month showingby districts the amounts of the several classes ofgrants-in-aid actually disbursed to each local bodyduring the previous months. The statement relating togrants for water-supply schemes will be sent to theMunicipal Administration aria Water Supply Departmentand the statement relating to other ~rants will besent to the Public Works Department. After necessaryaction has been taken by the Government, the returnsreceived from the Accountant-General in each monthexcept those relating to March will be returned to himby the 5th of the succeeding month.

(d) As regards non-recurring grants to localbodies for roads and bridges and improvements of

• village communications, the ~ural Development andMunicipal Administration and Water Supply Departmentswill communicate tD the local bodies concerned theam~unts provided in the budget estimates as soon aspossible after the Approp~iation Act has been passed.The Chairmen of the municipal council and thepanchayat unions for which grants have been providedshould aubmit to the Government not later than thelOth January every year a statement in Form 'F'showing:


(t) the expenditure incurred on and the grantdrawn against each items of work up to the end of theprevious December; and

Iii) the probableaccurately as possible forof the year.

expenditure, estimated asthe rematning three months •

Expenditure / Receipts in England - With theabolition o~ the minor head "Charges inEngland/Receipts in England" the Chief AccountsOfficer, High Commission for India in United Kingdomwill classify the transactions presentLy recordedunder these minor heads, under the relevant major,minor, sub and detailed heads, of account under whichthey would have been classified had the transactionstaken place in India. He will continue to be theestimating officer for these transactions. In orderto enable the authorities to discharge that duty, itis essential that the authorities in India send tothem prompt intimation of any oircumstances which arelikely to affect the original budget estimates.

137. Special procedure tor Public Works andForest pepartments- The procedure- laid down belowapplies to expenditure in the fubLic Works and ForestDepartments only when the officers meet the charges bydrawing bills on the Pay and Accounts office in thecity or on the treasuries, e.g., Salaries, and Officeexpenses. - As regards the mofussil offioes of thepublio Works Department, the reoonoiliation should beeffected b¥ the Superintending Engineers concerned b¥means of monthly statements of account anddiscrepancies. In regard to the charges which thesedepartments meet by drawing cheques on the treasury,the accounts compiled by the Acoountant-General arebased on initial accounts maintained by thedepartmental officers them~elve5 and the procedure fo+the c9ntrol of expenditure is, the~efore, aomewhatdifferent as indicated below;-

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(a)divisionalnecessary

•

Public Works ,pepartment - (i) Theaccounts furnish all the information

for the watching of expenditure. The


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divisional officers should prepare a monthly statementin Form 'G' (FOrm '~' in the P.W.A. Code) for eachmajor head of account. This statement should show thevariou? minor heads, sub-heads and individual worksfor which specific appropriations have been sanctionedby higher authorities as well as the appropriationstherefor as modified from time to time. If a lumpsumappropriation has been placed at the disposal of thedivisional officer for more than one work, they May begrouped together and only the total shown. Theexpenditure incurred under each unit of appropriationshould be posted in. the relevant column from theregister of works and the schedules of ,worksexpenditure. For suspense.heads, the net credit ordebits qlone need be posted .. Undischarged liabilitiesand anticipated credits should be. separately recordedin the column provided for the purpose.

(ii) The statement should be completed withina week after the date fixed for closing of thedivisional accounts and a Copy forwarded to thesuperintending Engineers. The latter will consolidateth~ 5tatement~ received from the divisional officersinto a circle report in Form 'H' (Form 'Y' in P~W~A.

Code) and send a copy to the Chief Engineer. TheChief Engineer will check the accounts with those inthe Accountant-General's office following theprocedure prescribed in paragraph 127 and communicate'any discrepancy between the departmental and theAccountant~General's accounts to the superintendingEngineer for reconciliation. corrections J if any,intimated by the Chief Engineer should be incorporatedby the Superintending Engineer in his accounts andcommunicated to the E~ecutive Engineer .

.(iii) The Chief Engineer will also review the

progress of expenditure for each circle with L~L helpof the circle report and also consolidate the ci~cle

statements' in Form 'H' (Form 'Y' in the P.W.A. Code)for the purpose of reviewing the progress ofexpenditure for the whole state.

Ib)other th;tn

Forest Departmen~-The disbursing officers,the State silviculturist and the Forest


Utilization Officer, should send ~o the Conservator ofForests in Form 'J', a progressive statement ofexpenditure for each month compared with theappropriations, so as to reach him not later than the8th of the succeeding month. This statement should be ~

compiled from the monthly divisional account forwardedto the Accountant-General. .The District ForestOfficer should also submit to the Conservator everymonth three days after the monthly accounts are sentto the Accountant-Ceneral, a statement in Form 'K' of •the progress of expenditure on individual workssanctioned by a higher authority. The details ofexpenditure under office expenses, etc., should bewatched through the contingent registers.,

The conservator receives from theAccountant-General a monthly summary of expenditureunder the several heads of accounts and he shouldreconcile the summaries with the district returns inForms 'J' and 'K',. He should also consolidate his ownexpenditure and that is shown in the statement of theDistrict Forest Officers in a progressive statement·for the whole circle in Form 'L',

The Conservator should also prepare return inForm 'J' for the circle as a whole and send it to theChief Conservator so as to reach him not later thanthe 18th of the month. The Chief Conservator willalso obtain similar statements for each month by the18th of the succeeding month, directly from the StateSilviculturist and the Forest Utilization Officer andwill then consolidate his own expenditure and that isshown in the circle and other returns in a singlestatement in Form 'L', so that he may watch theexpenditure of the department as a whole against the ,appropriations, He should also reconcile thestatement with the summary of expenditure for themonth based on audited figures which will be sent tohim by the Accountant-General.

(c) The Government have introduced a system ofissue of letter of credits commencing from 1st August1972 for each Drawing Officer of Public Works andForest Departments on the Sub-Treasuries or Treasuries

,',. "',' ~


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stipulating the amount \ 'th'a-t:' could be drawn by theofficer concerned in thre'/;:in'stalments (i) First for aperiod of 6 months fro~';Aprfl to September based onthe Budget' Estimates.' for ''the' year, (ii) second for aperiod of 3 months from:Octob~r to December based onthe Budget Estimates 'fbi: the year, (iii) Third for a

, ,.period of 3 months from January to March based on theRevised Estimates for the'"year and also the totalamount that could be ~rawn:dJring the year. The Headsof Departments covereB'by'the, scheme will furnish tothe Finance Department a~5tatement showing the budget

.' ',,-.l. I 1- , •

allocations, the amount-'ne'cessary for operation atheadquarters for adjustments ~gainst central purchasesand by way of central reserve for further allocationfor special and urgent needs of subordinate officersand the limits upto :'whichtl1"e subordinate officersneed be allowed to ilraw·, funds every quarter. Thebreak' up to be given tO~Government will be' for adistr,ict Treasury as" a"': Iunit. Based on thesestatements the Finance'Depart~entwill issue necessaryinstructions to the Treasury20fficers indicating themonthly as well as annual ll al1.ocations for the variousdrawing officers. The~e '''Dr"awing Officers (i. e.Divisional Engineers) will further allocate theallotments among vartbu~lsub6rdinateofficers workingunder them (e.g., AssiBtant8 Engineer) and inform theDistrict Treasuries of theCallotments. The District

• ,c~,

Treasury Officers wLii in~ turn communicate theseallocations to the concerned branches of the StateBank of 'India, the various""'sub-treasuries 'and theconcerned branches of the'~tate Bank of India.

'(.J ...

. - "l';-'n ~·I··

The intention is'tnat'the drawal of cheques bythe off icers ot' ,the pllblicJWorks Deparement and Fare~t

Departments should be~regulated with reference to theallotments for those _officers communicated to therespective branches of tHeYsfAte Bank of India.

="\1°' ·.-':..r ...·~-·~

• This systemonly the Drawings onWorks Department an~

of letters of credit willthe expenditure side underF6re~t 'Remittances.

applyPublic

Chequeswill be honoured

drawn' by "tHe'various Drawing Officers. ,. '/ '_.: ':...'

by the'branches of the State Bank of

122 THE TAMIL.NADU BUDGET MANUAL

•India upto the amount of allocation communicated tothe bank in respect of that officer. In case thedrawings ~n a partic~lar month fall below theallocation for that month, the officer will bepermitted to carryover Buch balance to the subsequentmonths, s~bject to the over all provision not beingexceeded. The balance o~tstandings as at the close ofthe financial year namely, 31st March will however,stand lapsed.

137-A. Annual report to be sent to FinanceDepartment The Chief Controlling Officers sho~ld

submit annually in July each year to the FinanceDepartment a certificate that the reconciliation ofDepartmental fig~res with those of theAccountant-General upto March (Preliminary) accountshas been completed. The certificates of completion ofsuch reconc~liation in respect of transactions bookedby the Accountant-General in March (Final. andSupplementary) account should also be submitted toGovernment by 31st August each year. The ChiefControlling Officers should also indicate in thecertificate the heads of accounts sa recanciled~

Highest importance is thus attached to proper andprompt reconciliation of accounts. stop paymentsorders should be resorted promptly by the Director ofTreasuries and Accounts to ensure promptreconciliation of accounts. [G.O.Ms.No.818, Finance,(BGI), dated 29.10.91J.

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CHAPTER IX.

RE-APPROPRIATIONS AND SUPPLEMENTARYAPPROPRIATIONS.

138. The preceding chapter described theprocedure laid down for watching the progress ofexpenditure against the appropriations. The presentchapter describes the action to be taken whennecessary, as a result of this control of expenditure .It has to be remembered that an appropriation isoperative only until the close of the financial yearand that any unspent balance then lapses and is notavailable for utilisation in the following year.

SECTION I - SAVINGS IN APPROPRIATIONS.

139. The progress of expenditure month bymonth and careful assessment of the commitments andliabilities for the remaining part of the year mayindicate sav~ngs in the appropriations shown againstthe several minor heads, sub-heads or detailed headsin the detailed budget estimates and grants. ThereQre several possible reasons for such savings, suchas, overbudgeting or postponement of or economy inexpenditure.

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140. All savings anticipated by the ChiefControlling officers should be reported by them withfull details and reasons to the administrativedepartments concerned of the Secretariat immediatelyafter they are foreseen, unless these are required tomeet anticipated requirements for additional fundsunder some other heads within the total allotmentunder the same minor head under his control. Noamount out of savings should be held in reserve formeeting additional expenditure not definitely foreseenor already approved by the competent authority. Theadministrative departments should intimate such of thesavings reported by the Chief Controlling Officers asmay not required by them to the Finance Departmentwhich will resume the savings. savings so resumedwill be reallotted by the Finance Department ifnecessary, when dealings with applications forre-appropriations or supplementary grants orappropriations.

85/21--5


SECTION II - RE-APPROPRIATIONS.

141. Every Chief Controlling Officer isexpected to see not only that the total e~penditure iskept within the total grant or appropriation placed athis disposal but also that the expenditure under eachunit of appropriation is kept within the amountorignally provided under that unit. Transfer of fundsfrom one unit to another, i.e., re~appropriatian

however, sometimes becomes unavoidable~

142. Re-appropriation is permissible onlywhen it is known or anticipated that the appropriationfor the unit from which funds are diverted will not beutilised in full or that savings can definitely beeffected in it. It is both objectionable andirregular to sanction a reappropriation from a unitund~r- which nO savings are anticipated at the time ofsanction in the expectation of restoring the originalallotment under that unit later in the year bytransferring to it savings that may then becomeavailable under other units.

143. Re-appropriations are not permissible--

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"Grant( i }

18.from one Grant to

.Medical" and "Grantanother (e.g. ,between19. Public Health") ;

I ii) From the charged .to the Voted section, orvice-versal

(iii) to provide for "new services and newinstruments of service" whether voted or charged untilsuch expenditure has been authorised by an 'Appropriation Act;

(iv) to increase or provide for theexpenditure on an item the provision for which wasspecifically ~educed or disapproved by the ASsemblyeither through a subBtantive or a token cut; •

(v) re-appropriation is notheads of department and departmentsbetween any two categories of the

permissible byof Secretariatfollowing four

THE TAMIL N~DU BUDGET MANUAL 125

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categories v~z. centrally-sponsored, non-planschemes, state plan schemes, schemes financed byautonomous bodies; that is no reappropriation betweengroup sub-heads is permissible by heads of departmentsand departments of Secretarrat.

(vi) re-appropriation is not permissible bydiversion of savlngs from "Salaries" to "TravelExpenses" and "Office Expenses". IG.O.Ms.No.B6B, Fin(BGI) dated 16.11.91).

(vii) after the close of the financial year.

144. As the Demands for Grants whetheroriginal or supplementary, placed before theLegislative Assembly are for gross expenditure withouttaking into 'aCCQunt deductions on account ofrecoveries, credits on account of recoveries ofexpenditure must be ignored for the purposes ofsanctioning re-appropriation of funds or obtainingsupplementary grants. ~

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NOTE:- Rectification of misclassification ofexpenditure from one work to another need nat betreated as 'recoveries' as such adjustments arenecessary for correct presentation of works accounts.Such adjustments should nqrmally be treated asreduction of expenditure. Similarly surplus stores ortools and plant returned from works or transferredfrom one work to another should be treated asreduction of expenditure. But the cost of releasedmaterials relating to renewals and replacement worksor assets which are abandoned should be treated asrecovered .

145~ Re-appropriation should invariably be inmultiples of Rs.l,OOO in the case of expenditure inIndia and £ 25 or Rs.l,OOO in the case of transactionstaking place in United Kingdom.


146. Re-appropriation should be from onedetailed head of appropriation to another. Thesub-detailed heads of account if any included in thedetailed head of appropriation should be ignored forthis purpose. In respect of individual major workswhich figure as sub-detailed heads in the P.W.D.Budget reappropriation shall' be done by FinanceDepartment up to the detailed head level only whereasthe Chief Engineer shall issue reappropriation ordersbetween sub detailed heads subject to the conditionsin paragraphs 143, 144, 145 and 147.

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powerfromThetoto

14t. The Finance Department shall haveto sanction any reappropriation within a grantone major, minor or subordinate head to another.Chief Controlling Officer shall have full powerssanction re-appropriation within a grant subjectthe conditions in paragraph 143 and provided that -

la) the expenditure is under the generalcontrol of the administrative department concerned orthe general or direct control of the head of adepartment or authority sanctioning thereappropriation; c and

(b) theundertaking ofliability whichquestion.

reappropriation does not involverecurring liability, that is

extends beyond the financial year

tnea

in

NOTE(l).-Proviso (b) doesundertaking of the liabilitysanctioned with the concurrenceDepartment and the reappropriationgive effect to the sanction.

not apply when thehas already beeh

of the Financeis made merely to

•NOTE(2) .-An example of the type of

reappropriation that can be done by heads ofdepartment is as follows: Under Demand 21, theDirector of Fisheries is permitted to reappropriatefrom the head 2405-001. Direction and Admin~stration

T. Non-Plan - AC. FiSheries Engineering Staff - Headquarters Establishment to 2405.109. Extension andTraining - T. Non-plan - Ae. Training of personnel

THE T~MIL N~DU BUDGET M~NU~L 127

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of the Fisheriesactivities. He2405.001. - I and Propaganda .

Department in departmentalcannot however reappropriate from

~C to II. State Plan - JA. Planning

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Exceptions.- There are certain exceptions tothe above rule of reappropriation. These exceptionsare with special reference to the Public Works,Irrigation and Highways Departments .

(i) The final appropriation under the detailedhead '<minor works'~ executed by the Chief Engineer(Buildings) under the respective buildings sub-headsof different departments, should not exceed theceilings fixed for the departments in paragraph 44 ofthe Budget Manual.

(ii) While issuing reappropriation orders inrespect of ihdividual major work Isub~detailed heads}the Chief Engineers should ensure that the cumulativefinal appropriation over the years for a work does notexcceed 10 per cent over the sanctioned estimate forthat wo>:k.

(iii) The powers of the officers of the PublicWorks, Irrigation and Highways Departments to sanctionreappropriation are subject to the restriction thatthe reappropriation does not involve transfer of fundsto a work which has not received the requisiteadministrQtive approval and technical sanction.

,(iv) Reappropriation

"salaries· to the detailedpe~missible in general.

from the detailedhead ., works" is

headnot

148. The Chief Controlling Officers in theForest, Public works and Irrigation Departments willbe held responsible for ensuring that the officers

• subordinate to them exercise properly the powers ofreappropriation delegated to them and that noirregular reappropriations are allowed.

149. If the appropriation unde>: areduced by reapprop>:iation sanctioned by a

unit iscompetent


authority or by resumption, the expenditure debitableto the unit should be restricted to the reducedappropriation. No authority subordinate to the onewhich sanctioned the reduction in the originalappropriation may increase the appropriation in theexercise of-its own powers of reappropriation, unlessthe previous consent of the authority which reducedthe appropriaton has been obtained. If the authoritybeing the Government in the Finance Department thesanction should be applied for when necessary, throughthe Governemnt in the administrative departmentconcerned.

150. Proposals for reappropriation which theChief controlling officers are not competent tosanction should be submitted with two. copies ofreappropriation statements to the administrativedepartments of Secretariat which may sanction them ifcompetent to do so or forward them to . the FinanceDepartment for sanction.

151.(il When any" reappropriation issanctioned. the authority which accords the sanctionshould draw up its proceedings in Form M and forwardone copy direct to the Accountant-General and one copyto the Government in the administrative departmentwhich will transmit it to the Finance Department.When the sanctioning authority is not the head of adepartment, these copies should be forwarded to theGovernment through the latter.

Iii) An application to the Government for areappropriation of funds should be prepared in Form Nand the Head of the Department should submit it directto the administrative department as a rule. Separatestatements should be prepared for reappropriationsrelating to charged and voted expenditurerespectively. When a Chief Controlling Officercontrols the expenditure under more than one grantseparate surrender and reappropriation statementsshould be submitted for each grant. The reasons forthe additional" expenditure and the savings should beexplain.ed clearly and fully on the reverse of therelevant form or in a covering letter. Vagueexpressions such as "based On actuals" "based on

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THE T~MIL NADU BUDGET MANUAL 129

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progress of expenditure" J etc-., should be avoided.Res~rting to seek additional appropriation after thesanction of First round of Final Modified~ppropriation and- Final Supplementary Estimates isalso to be avoided and only the-savings alone reportedto Government in the end of the financial year.

152. Re-distributions.- Redistributions asbetween different sub-detailed heads under a detailedhead which have not been declared as specificappropriations are not treated as reappropriations andneed not therefore be communicated to theAccountant-General or to the Government in theadministrative and Finance Departments. Suchre-distributions may be sanctioned by Heads ofDepartment provided that the additional expenditurenecessitating the re-distribution has been sanctionedby the competent authority.

SECTION III - EXPENDITURE NOT PROVIDED FORIN THE BUDGET,ESTIMATES.

153. (a) The appropriations against the severaldetailed-heads as shown in the original budgetestimates should not ordinarily be exceeded~ Theestimates provide for all items of expenditure for thefinancial year as far as they can be foreseen andwithin the limit of available funds. Proposals forfresh expenditure not provided for in the estimate inthe course of the year are therefore not justified inordina~y circumstances and should not be made, unlessthere are very special reasons.

,

(b) Unavoidable and unforeseen circumstancesmay, however, sometimes arise in the course of afinancial year making it necessary to incur urgentlyfresh expenditure under one or more sub-heads or toincur expenditure an a "New Scheme" not contemplatedin the original budget estimates~ In such cases, theprocedure for providing the requisite funds 18 asfollows ;-

_ {l)postponementincluded in

Savings inor curtailmentthe same grant

other appropriations byof less urgent expenditrue(charged or voted portion


as the case may be} may be reappropriated for thepurpose except when the additional expenditure is onaccount of a "New Service".

(2) If the above mentioned course is notpossible, a supplementary statement of expenditureshould be presented to the Legislative Assembly as'laid down in Article 205 of the Constitution.

(c) It is in all cases the duty of theControlling officer who for special reasOns desires toincur in the course of a year fresh expenditure notprovided in the budget estimates for the year toexamine carefully whe~her the fresh expenditure cannotbe offset by the postponement or curtailment of lessurgent expenditure for which provision has been made~

(d) (1) The approval of the LegislativeAssembly to any additional expenditure over the amountvoted by it for gross expenditure in a grant will betaken by means of a supplementa~y grant.

(2) In respect of expenditure charged on therevenues the Finance Department will sanction thenecessary appropriation of funds to cover excesses inthe gross charged expenditure under the grant.

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{e) Expenditure on a "New Service" or a "NewInstrument of Service" not contemplated in the Budgetestimates for the year should not be incurred whetherthe expenditure is charged or voted and whether it canbe met by reappropriation or not until it is includedin a supplementary statement of expenditure presentedto the Legislative Assembly and eventually in anAppropriation Act. If the expenditure can be met fromthe savings within the grant wholly, or in part itwill be sufficient if a token sum of Rs.l,OOO or thebalance actually required, as the case may be, isincluded ~n the supplementary statement ofexpenditure.

,

(f}Legislativeadvance mayTamil Nadu

,

Pending the authorization of funds by theAssembly in the manner indicated above anbe sanctioned by the Governor~ from tQeContingency Fund to enable urgent


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expenditure being incurred on a "New Service't or a"New Instrument of Service" or on an "existingservice". The rules relating to sanction of advancesfrom the Cont~ngency Fund and the accounting procedurewill be found in Appendix- G. When a proposalinvolving new expenditure not contemplated in thebudget estimates but not on a t'New service" issubmitted to the Government and the expenditure can bemet by reappropriation, funds should not be providedby reappropriation in anticipation of the government'ssanction to the proposal, since if the sanction is notgiven or is delayed, the funds so provided will lapsewholly or in part. In order to avoid such lapses, theapplications for sanction to the expenditure and forreappropriation of funds should be submitted together.

(g) When an additional appropriation isrequired urgently in a case not involving a newservice and no saVings are foreseen, the authorityconcerned should apply to the administrativedepartment of the Governemnt for permission to incurthe expenditure~ That department, may, with theconcurrence of the Finance Department, sanction orauthorise the incurring of the expenditure and informthe Accountant-General, that provision will be madelater either by reappropriation or, if this provesimpracticable, by placing before the Legislative~ssembly in due cOurse a supplementary statement ofexpenditure. Where considered necessary an advancemay be sanctioned from the Tamil Nadu contingency Fundto cover the expenditure, pending the authori~ation offunds by the Legislative Assembly. The ControllingOfficer in respect of the expenditure will beresponsible for seeing that the required funds areprovided at least before the end of the year. He willbe held responsible if a supplementary appropriationobtained on his recommendation .is found tD have beenunnecessary .

NOTE.-The Government will decide whetheradditional expenditure proposed in the course of ayear is expenditure on a new service or not withrefecence to the rulings of the committee on theSUbject incorporated in Chapter X.

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154. A supplementary grant or appropriationis an addition to the total authorised grant orappropriation for a financial year and has to beobtained in the manner prescribed in Article 205(1) (alof the constitution, passing through the same stages •of legislative procedure as the original grant Orappropriation.

155. (a) Supplementary grants or appropriationsare required in the following cases :

(i) When the amount included in a grant orappropriation (voted 'or charged) authorised by theAppropriation Act is found to be insufficient for theyear; Or

iii) when need has arisen for incurringexpenditure whether voted or charged, upon some tlNewService", "New Instrument of Service" of New Schemenot contemplated in the Appropriation Act for the yearevent hough it can, be met wholly or in part byreappropriations within the amount authorised underth~ Grant or the Appropriations;

(iii) when it is desired to obtain the priorapproval of the Legislative Assembly to a schemeinvolving large financial commitment event hough littleOr no expenditure on that account is anticipated, inthe current year4

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(b)token Sum ofas the casesupplementaryfalling underRs. 'I f 000 need

In cases falling under clauseRs.l,OOO or the amount actually

may be, should be includedstatement of expenditure whileclause (iii) only a token

be included.

(iil, arequired,

in thein casessum of •

(0) the supplementary estimate should includeall -"New Services" sanctioned in the course - of thecurrent year for which the approval of the LegislativeAssembly has not been obtained. The reason why eachscheme is dealt with as a "New Service" should' bespecifically mentioned in the Explanatory Note. Thesalient features of the scheme sanctioned by theGovernment, with the details of estimated cost, the

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place of execution of the scheme, expenditure duringthe current year and the nature of expenditure likeRevenue t Capital, Loan should also be furnished in thenote .. These notes should cover also items~of Chargedexpenditure by way of payment by the Governemnt ofcosts' awarded by COULt~ for which advances have beenor are proposed to be sanctioned from the ContingencyFund and any other item of Charged expenditure forwhich addit~onal appropriation is required. Afteracceptance by the Finance Department, four cleancopies of each Explanatory Note typed neatly on singlepage, should be sent to the Finance Department notlater than 25th February of every year. A copy of theGovernment order sanctioning the scheme should also beenclosed along with the note for Final SupplementaryEstimates. It will not be possible for the FinanceDepartment to take into account copies of note on

'supplementary estimates, or corrections to thesupplementary Estimates, which are received after the25th February of every year. The Departments whichfail LO send propoals in timeT may be called upon bythe Public Acccounts, Committee later to account fortheir default.

156. If a supplementary estimatesincreased provision in respect of a sanctionedthe authority concerned should show--

is forobject,

(a) that the need for the increasedcould not be foreseen at the time when thedepartmental ,estimate was framed; and.

provisionoriginal

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(b) that in the absence of such provisioninjustice would be caused to some person not at faultor serious inconvenience or serious loss or damagewould be caused to public s~rv~ce. A supplementaryestimate for increased provision will not be presentedunless condition {b} is fulfilled. Failure to fulfilcondition (a) whether condition (b) is fulfilled ornot is a financial irregularity and may involve areport to the commi~tee on Public Accounts.

157. If a supplementary estimate is requiredfor some new expenditure not contemplated in thebudget, the authority concerned must show either -

•


(b) that urgent necessity has arisen for theproposed expenditure the postponement of which would(i) involve extra expenditure ultimately, or (ii) beadministratively impossible or would be against anyaccepted policy.

(a) that the expenditureimposed by Statute, or by order ofother competent authority; or

has been newlya Court af Law, or

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The Finance Department must necessarily agreeto the presentation of supplementary estimate in case(ai, while in case (b) its presentation will depend onthe urgency of the proposed expenditure.

158. The principles enunciated in paragraphs156 and 157 apply also to an application for asupplementary estimate in respect of any demand towhich the Legislative Assembly as previously refusedits assent or the amount to which the Assembly hasreduced either by a reduction of the whole grant or bythe omission or reduction of any of the items ofexpenditure of which the grant is composed.

159. The primary responsibility in regard toproposals for supplementary grants or appropriationsrests on the Chief controlling Officer who shouldexplain clearly in each case not only why asupplementary grant or appropriation is required butalso why the need could not be foreseen at the timewhen the original budget estimates were framed. Inexplaining the proposals, it should be clearlyexplained in detail whether specific conditions asprescribed under paragraphs 156 and 157 as may berelevant are strictly fulfilled. If it is underclause (b) of paragraph 157 the authority concernedshould explain the necessity and the urgency of theproposed expenditure and also why it is notadministratively possible to postpone it. Greatestcare should therefore be taken in sUbmitting suchproposals. It must be carefully understood that ifafter the close of the financial year it is revealedthat any supplementary grants Or appropriationsobtained were unnecessary or excessive, the officers

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THE TAMIL MADU BUDGET MANUAL 135

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at fault will be held ressponsible for the financialirregularity to which the Accountant-General is boundto draw attention in the Audit Report on theAppropriation Accounts which will come up before theLegislative Assembly and the Public Accounts Committeein due course.

160. (a J Proposals for supplementary grantappropriations should be submitted to the Governmentin the Administrative Departments concerned as andwhen the necessity arises except those relating to thetransaction taking place in United Kingdom in respectof which proposals will be forwarded direct to theFinance Department by the High Commissioner for India.The administrative departments will examine theproposals received by them and forward them with theirrecommendations to the Finance Department. Proposalsreceived direct by the Finance Department will bereferred to the administrative departments concernedfor their remarks, and the administrative departmentwill ask the Chief Controlling Officer of the grantconcerned, if necessary, for his opinion as to whetherthe application' may be complied with. If asupplementary appropriation is required solely onaccount of the insufficiency of the originalappropriation placed at the disposal of the Chiefcontrolling Officer concerned, and if there aresavings resumed and held under the grant concernedwhich the Chief Controlling Officer was not aware of,the Finance Department will, if convinced of thenecessity for the 'supplementary appropriation,sanction it by reappropriation from these savings. Ifthere are no such savings, the procedure prescribedfor laying before the Legislative ~ssembly

supplementary statements of expenditure will befollowed ..

•(bJ Copies of all sanctions accorded by the

Finance Department and of the ~ppropriation Actpertaining to the supplementary statement ofexpenditure will be communicated to theAccountant-General, the administrative department andthe Chief Controlling Officers concerned in all cases;orders relating to expenditure in England will also be

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136 THE T~MIL N~DU BUDGET ~NU~L

communicated to-the High commissioner for India or theAccountant-general, Commonwea.l th Relations Of f ice, asthe Case may be and to the Director of Audit, Indianaccounts in the United Kingdom, London.

161. (a) Resumption of savings,reappropriations and supplementary appropriations maybe authorised by the' competent authority upto andincluding of the last day of the financial yearconcerned I but not a,fter its expiry. The latest datesby which proposals that require th8 sanction of theGovernment should reach the Government are as shownbelow :-

(1) Receipt in the Finance Department ofproposals from the High Commissioner for India inLondon, 25th January. further modifications should,if necessary, be intimated by cable .before the 25thFebruary_

{2} Receipt in the administrative departmentof proposals from chief Controlling Officers (otherthan the High Commissioner for India) and from localbodies in the case of proposals to be submitted bythem - 15th February.

(3) Receipt in the Finance Department from theadministrative department-25th February.

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(4) In the case of savings relating to specialitems (e.g. expenditure on land acquisition, paymentof cost of materials and disbursement ofgrants~in-aid) which could not be foreseen earlier,surrenders m~y be made to the Finance Department upto *the 20th March, if the amount involved exceedsRs.l0,OOO or 10 per cent of the final appropriationwhichever is greater under the concerned detailed headof appropriation.

'.(5) In exceptional cases, Finance Departme~t

may be advised of further savings upto the 31st March,if the amount involved under the detailed heads ofappropriaton concerned exceeds 10 per cent of thefinal appropriat~on or rupees one lakh, whichever isgreater .

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(b)later i.e.,March, fullthe savings

THE TAMIL ~ADU BUDGET MANUAL

When proposals far surrenders areafter the 20th March, but beforeexplanations should be given as to

could not be foreseen earlier.

137

made31st

why

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(c) Proposals for surrender which are receivedvery late run the risk of not being accepted by theFinance Department l even if there are adequatereasons, as resumption orders cannot be issued by theGovernemnt after the 31st March. All proposals forsurrender of savings should, therefore, be sent to the.Finance Department as soon as they are foreseen andofficers who make any belated surrender which couldhave been made earlier will be held persgnallyresponsib-le for the irregularity. Proposals receivedafter the prescribed dates will not be considered bythe Finance Department.

NOTE.-The Chief Engineer for Irrigation shouldsend to the Government in the Finance Department notlater than the 25th February every year a statementshowing the estimated capital outlay on Irrigation inthe year.

SECTION V -'EXCESSES OVER THE FINALGRANTS/APPROPRIATIONS FOR A FINANCIAL YEAR.

162. (a) The 15th February has been fixed asthe latest date for s~bmission of application to theGovernment by the Controlling Officers for surrenderof savings in appropriations and for reappropriationsand suppleme.ntary appropriations. The Heads ofDepartment are requested to ensure that allliabilities on account of supplies made or servicesrendered by other Governemnt departments, privatebodies, etc., are provided for in their proposals forfinal modification of fun~s and that every effort ismade to utilise the additional provision made; bypromptly getting into touch with those who made thesupplies, or rendered the service~ Similar actionshould also be taken in respect of sums recoverablefrom other Governemnts, private bodies, etc., for

138 THE TAMIL NADO BUDGET MANUAL

service rendered or supplies made to them byDepartments of this Governemnt~ While it is the dutyof a supplied department to arrange to debit itselfand pass on the credit to the supplying department, itis equally the duty of the Chief Controlling Officersto remind the supplied depa~tment where necessary andsee that a debit is raised in time and adjusted so asto avoid lapses of the funds provided for the purpose.This should enable them to formulate their finalrequirements for the year on the basis' of the actualexpenditure in the first nine or ten months and theanticipated requirements for the remaining months ofthe financial year. Savings or excesses remainingunregularised at the end of the year should occur onlyvery rarely, if at all, and cannot as a rule bejustified, unless they are due to circumstances beyondthe control of the departmental officers concerned,e.g., the incurring of inevitable or emeLgentexpenditure which could not have been foreseen. Suchex~endituce should not be carried over to thesubsequent year, solely on the ground of absence ofbudget provision.

,.

•

(b) In order to make sure that all proposalsfor final modification of fu~ds to reach theadmini5trat~ve department of the Secretariat concernedand the Finance Department r the Heads of departmentare requested to obtain proper acknowledgment for thepapers delivered at the Secretariat and in importantcases, send a demi-official reminder after a weekenquiring whether action is being taken and watch thereceipt of reply. The administrative department ofthe Secretariat should r On receipt of a copy of theproposals from the Head of a Department, verifywhether another copy has been received in the FinanceDepartment and action is being taken thereon. Theyshould also watch the receipt of the final orders fromthe Finance Department and send reminders, wherevernecessary. The copy of a communication received from ~

the Head of a department in this regard should not be"lodged" on the assumption that the Finance Departmentwill issue orders in due course or, 'transferred'finally to the Finance Department for disposal.

I


•

•

•

(c} The excess over a Grant as a whole isunconstitutional and should be avoided by sending intime proposals to cover the anticipated excesseseither by reappropriation or supplementaryappropriation. Chief Controlling authorities shouldtake every effort to anticipate the excesses and to

··cover them well in time4

163. (a) The final grant/appropriation and theactual expenditure in the year under each group head(group of detailed heads of appropriation) under eachgrant/appropriation is indicated in the grantstatements prepared by the Accountant-General andforwarded to the Chief Controlling officers for theacceptance of figures. Important cases of variationsbetween the grant/appropriation and the actualexpenditure under the group heads are included in theAppropriation Accounts for the year together with theexplanations furnished by the Controlling Officers andaudit comments, if any, thereon.

(b) The ~ccountant-General also mentions inhi.s "general review of the results of appropriationaudit and control over expenditure~ included in theAudit Report.-

(i) cases of excesses or saving in grants!

appropriations as a ~hole1 . and

(ii) individual cases of variations indicative o~ -

(a) defective budgeting;

(b) injudicious or inadequate reappropriation;

(e) non-surrender of savings; and

• (d) omissions to cover excess expenditure .

164. Detailed instructons fordraft paragraphs for inClusion in theaccounts are outlined in paragrph 182.

dealing withappropriation


SECTION - VI. DEMANDS FOR EXCESS GRANTS.

165. Under clauses 1 (b) and 2 of Article 205of the Constitution, if any money has been spent onany service during a financial year in excess of theamount granted for that service and for that year,demand for such excess amount has to be presented tothe Legislative Assembly and is to be dealt with inthe same way as if it were a demand for grant.

166. A demand for an excess grant differsfrom a demand for a supplementary grant in that, whilethe latter is essentially a demand for a grant theneed for which is foreseen during the currency of ayear and is presented in the year to which it relates,a demand for an excess grant is presented toregularise the expenditure incurred in excess of thegrant made in a particular year. A demand for anexcess grant can be laid before the Legislative~ssembly only after all the expenditure of the yearhas been audited' and the Appropriation Accounts of theyear have been compiled by the officers of thecomptroller and Auditor-General of India andconsidered by the Committee on Public Accounts. Thework of compilation of the Appropriation Accounts bythe Accountant-General and their consideration by theCommittee on Public Accounts however take sometime.In practice, therefore, it is not possible to presenta demand for an excess grant until about two yearsafter the expiry of the financial year to which itrelates and until the recommendaions of the Committeeon Public Acconts are received.

167. The same principles and procedure applyto an excess in the total appropriation for chargedexpenditure" under the heads of account included withina grant or under the separate charged appropriationsrelating to "Interest on debt and other obligation"and "Reduction or avoidance of debt", the onlydifference being that an excess in respect of chargedexpenditure does not, require the vote of the Assembly.

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. ,\

q .. ,CHAPTER X.

FINANCIAL PROCEDURE RELATING TONEW SCHEMES TO BE INTRODUCED INTHE COURSE OF THE FINANCIAL YEAR.

168. No Government servant may incur any itemof expenditure from the public funds unless sufficientfunds have been provided for expenditure in the

.Appropriation Act for the financial year or byreappropriation of funds. Normally provision forschemes of new expenditure will be made only in themain Budget taking into account the availablereSources after providing for all existing sanctionsand the relative priority of schemes of newexpenditure. Sometimes proposals for new schemes aresent to the Finance Department so late in the yearthat it is not possible for that Department to examinethem completely in detail, In the. case of proposalsforming part of the Five Year Plan requiring approvalof the Government of India, the approval is notobtained in time or details are not finalised in timeso as to 'include provision for them in the budget.Such schemes may be considered to bE so urgent andessential that they nOW cannot wait for the nextbudget day for being sanctioned. Similarly newdevelopments may take place in the course of afinancial year necessitating sanction of new schemesrendered unavoidable till the next budget. Suchschemes are sanctioned in the·course of the financialyear depending upon the urgency and importance of the~cheme5. These sanctions cover a wide range frompetty items like a typewriter to an office to largeitems like an irrigation project. Strictly all suchsanction should be ratif ied .by the LegislativeAssembly but 'n the nature of things, it is notpossible to move a supplementary demand in theLegislative Assembly on every item~ The PublicAccounts Committee of the Legislative Assembly has,therefore, 'laid down rules classifying the items onwhich' the separate vote of the Legislative Assemblyshould be obtained as "New Services" or ··NewInstrument of Services".

t


169. (a) The scheme of new expendituresanctioned in the course of financial year will be ofthree categories :-

(i) New Services;•

(ii) New Instrument of service;

(iii) Other New Schemes.

and

•

(b) Expenditure on a new scheme will become a"New Service" if it exceeds the monetary limits laiddown by the Public Accounts Committee and if similarcategory or type of expenditure has not been voted bythe Legislative Assembly in the past e.g. expenditureOn a Nuclear Research Institute.

(e) Expenditure on a new scheme will become a'"New Instrument of Service~' if it exceeds the monetarylimits laid down by the Public Accounts Committee asin the case of -New Services but similar category orclass of expenditure has been voted by the LegislativeAssembly in the past, e.g., opening of an additionalhospital or school. All other schemes the expenditureon which is within the monetary limits laid down bythe Publio Accounts committee will be new schemes.

(d) In the case of items (i) and (ii) thespecific approval of the Legislative Assembly isnecessary and this is obtained through a tokenprovision of Rs.l,OOO in each case if sufficientsavings within the grant are available or through fullamounts if no savings are available. In the case ofitem (iii) the specific approval of the LegislativeAssembly for each scheme is not necessary except tothe extent savings could not be found from fundsalready voted in the general bUdget under theappropriate head.

•

•

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170. (a)schemes of new

t

The criteriaexpenditure as

for clasBifying the"New Service" or "New


•

Instrument ofdown by thebelow :-

Service" or "Other New Schemes" as laidPublic Accounts Committee are shown

85/21--58

•

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. Nature of expenditure(1 )

1. Expansion of staff inexisting departments -

(i) Employment ofadditional staff whenit arises out of theadoption of a newpolicy by theGovernment, i.eo T

the sanction orincreaee of thecadres of serviceor number of postaof a particularkind (eitherpermanently or asa purely temporarymeasure, e. g. ,sanction of anadditional RevenueInspector or anAccountant in eachof the taluk officesconsequent on theintroduction of a newscheme of Governmentalactivity like theCommunity DevelopmentProject) .

(ii) Employment ofadditional staff forthe expansion of anexisting service,i.e., expenditure

- - ---,------ . - -.~

."

Limits revised(21

When the coat exceedsRs.S lakhs per annumrecurring or Rs.10 lakhsnon-recurring,. takingthe scheme as a whole itwill be treated as ascheme of "New Set'vice".(The entire cost ofestablishment, building,equipment, otheramenities etc., shouldbe taken into accountfor the purpose of thislimit) .

When the cost exceedsRs.S lakhs per annumrecurring or Rs.10 lakhsnon-recurring, takingthe Bcheme as a whole... 5:t .

•

144 THE TAMIL NADU BUDGET M~NU~L

•

on a New Instrumentof a s-erv ic.e, 1 ikethe opening of a newschool or the startingof a new scheme in theIndustries Department,Animal HusbandryDepartment, etc.,though ,similar schemesare already underoperation.

(iii) Employment ofadditional staff. forreorganisation of anexisting administrativeunit such as the

•bifurcation of aRevenue or a policeDistrict or thecreation of a NewAdministrative unit,etc. e.g' l a NewPublic Works Circle.

will be treated as ascheme of "New Service".(The entire cost ofestablishment, building,equipment, otheramenities! etc., shouldbe taken into accountfor the purpose of thislimit) - New Instrumentof Service.

When the cost exceedsRs.5 lakhs per annumrecurring or Rs.IO lakhsnon-recurring taking thescheme as a whole itwill be treated as ascheme of "New Service".(The entire cost ofestablishment, building,equipment, otheramenities, etc., shouldbe taken into accountfor the purpose of thislimit) - New Instrumentof Service ..

NOTE - The followingclasses of expenditureneed not be treated as"New Service n

:-

(i) Employment ofadditional staff for apurely temporary needfor a specific periodduring a financial yearif the cost does notexceed Rs.5 lakhsrecurring or Rs.IO lakhsnon-recurring .

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•

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2. Works

3. Expend~ture to be metfrom lumpsum provisionin the Budget.

4. Tools and Plant

85/21--5C

(ii) Employment ofadditional staff fornormal increase of work~nvolving no change inpOlicy cor the sanctionof any new schemes.

NOTE (~) - Theclassification"expansion of staff"in exist~ng departmentsw~ll also includeformation of newdepartments.

When the cost of newwork exceeds Rs.lO lakhs.In regard to theexpenditure on worksrelating to new schemeswhicn involveexpenditure on staff,equipment etc., thecost of scheme as awhole should be takeninto account for thismonetary limit.

When the cost exceedsRs.IO lakhs.

(i) Individual purchase·need not be treated as a"New Service"irrespective of cost solang as there isspecific provision inthe Budget .

(ii) Where specificprovision is natincluded in the Budget,when the cost exceed~

I


5.

5.

7 .

Expenditure on NewObjects and Purposes.

Committee constitutedby the Government fromtime to time ..

Grants and Contributions

Rs.5 lakhs, the purchaseof tools and plant willconstitute a nNewService't.

When the expenditure isestimated to exceedRs.3 lakhs recurring orRs.5 lakhsnon-recurring ..

When the expenditure isestimated to exceedRs.l lakh per annumrecurring Or Rs.2 lakhsnon-recurring ..

when the amount involvedexceeds Rs.2 lakhsrecurring or Rs.5 lakhsnon-recurring.

Grants-in-aid,Contributions, the likeof which has not beenvoted in the past, if itexceeds Rs.l lakhrecurring and Rs.2 lakhsnon-recurring.

• •

8. Revision of Scale of Pay When the revision of ascale or scales of payinvolves an extra costof over Rs.IO lakhs perannum. •

9 . Experiments,Investigations andDemonstrations.

When the' expenditure isestimated to exceedRs.2 lakhs recurring orRs.5 lakhsnon-recurring.

NOTE - All expenditureof this characterincurred each year

r

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THE TAMIL NADU BUDGET MANUAL . 147

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10. Loans to GovernmentCompanies, Local Funds,Private parties, etc.

•

without fruitful resultshould be reported tothe Accountant-Generalfor incorporation in theAppropriation Accountswith suitableexp~anation for reportto the Public AccountsCommittee in due course.For this purpose, eachdepartment of theSecretariat ~hould senda consolidated statement.of such expenditure tothe Finanoe Departmentevery year by 31st May."Nil" return also shouldbe sent to the FinanceDepartment, whereverapplicable.

1. Expenditure on loansthe like of which hasnat been incurred in thepast, if the expenditureexceeds Rs.l lakh.

2. Where specificprovision is notincluded in the Budget,when the loan exceedsRs.5 lakhs.

3. where there isspecific provision inthe BUdget when theexpenditure exceeds theBudget provision for ascheme by Rs.25 lakhs or10 per cent of theBudget provision for thescheme, whichever ishigher.


NOTE - 1. Loans toco-operativeInstitutions will alsobe governed by the abovecriteria.

NOTE - 2. Loans toGovernment Companies,statutory Bodies andGovernment Undertakingsinvolving additionalexpenditure resultingfrom cost escalationwithout any increase inthe physical componentand exceeding the BUdgetprovision by the limitprescribed in item 3above, need not betreated as "New Service"but details of suchcases should be given inthe Budget Memorandum ofthe following year.

•

11. Investments 'inGovernment Companiesand DepartmentalUndertakings.

(i) Setting up of a newGovernment Company Oramalgamation of two ormore GovernmentCompanies willconstitute "New Service"

(ii) Additionalinvestments in anexisting departmentalundertaking ofRs.50 lakhs and abovewhere there is noBudget provision.

(iii) Additional'investments ofRs.I0 lakhs and abovein an existing

•

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'THE TAMIL NADU BUDGET MANUAL 149

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12. Investments in PrivateSector Companies andPrivate Institutionsby Government.

Government Company witha paid up capital ofRs.l Crore and belowand Rs.25 lakhs andabove in case ofcompanies with a paidpp'capital of more thanRs.l Crore, where thereis no budget provision .

(iv) All investmentsfor the first time will.constitute "~ew Service".

NOTE - Investments inGovernment Companiesand Departmental

'Undertakings exceedingthe Budget prOVision bythe limits prescribed initems iii) and (iii)above need not betreated as "New Service ll

but details of suchcases should be given inthe Budget Memorandum ofthe fOllowing year.

(i) Investments in sharecapital of privatesector companies/privateinstitutions to be madefor the first timewhatever the magn~tude,

will constitute a"New Service".

(ii) Additional investments of RS.10 lakhs andabove in share capitalto the existing privatesector companies/privateinstitutions with a paidup capital of Rs.l Crore

150 THE TAMIL NADQ BUDGET MANUAL

and below; Rs.20 lakhsand above in case ofcompanies with a paid upcapital of more thanRs.1 Crore. •

13. ways and,Means advances Need not be treated as a"New Service" norcovered by advance fromthe contingency Fund ; _but they must be broughtto the notice of the

, Legislature in the nextsession.*

•

14. Subsidy involved inconcessional sales suchas sale of raw materialsto private institutionsat concessional rates,subsidised sale ofpesticides, agriculturalimplements, etc.

(i) When subsidy isintroduced for the' firsttime if the expenditureexceeds Rs.3 lakhsrecurring or Rs.5 lakhsnon-recurring.

(ii) Additional subsidycaused by increase inthe rate of subsidy,extension of scheme tomore areas, etear shouldbe treated as NewInstrument of Servicerequiring the approvalof Legislature if itexceeds ;-

(a) Rs.lO lakhsin the case ofsubsidies whichare passed On tothe public.

•,

•• I'his is brought to the notice of theLegislative Assembly by inclusion inthe Annexure to the SupplementaryEstimates.


1

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•

15.

•

,

Changes in classificationof expenditure.

(b) Rs.5 lakhs incases where thebeneficiaries areinstitutions .

NOTE - Subsidy should beshown as a separate subhead in the Demandconcerned. Detailsregarding theexpenditure on subsidy,commodities involved andthe reasons thereforshould be mentioned inthe Budget Memorandum.

Expenditure of existingservice uryder one headbut involving provisionof funds unde" adifferent head withinthe same section due tochange in classificationof expenditure need notbe considered asexpenditure on "Newserv ice" .

Explanation - Whereprovision for anexisting service hasbeen made either in theRevenue, capital or Loansection and it isproposed to change thecharacter of service bytransferring it from theexisting section to anyother section it willconstitute a "Newservice/New Instrumentof Service'! if thelimits prescribed forsuch expenditure areexceeded.

•


16. Expenditure on planand other schemes withfinancial assistancefrom Government ofIndia Or other bodies/institutions.

In cases where full orpart assistance isforthcoming fromGovernment of India orother bodies orinstitutions, themonetary limits fortreating such'expenditure as "NewService/New Instrumentof Service" will be thesame as indicated undervarious categories ~f

expenditure mentionedunder serial numbers1 to 15 above.

•

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GENERAL

(il Cases of "New Schemes" treated as "New... Service" and acted upon in the previous years need not

be treated a_s "New Service" again in the subsequentyears even though no provision has been made in thebudget of that year.

(ii) In respect of the schemes receivingassistance from Central Government, autonomous bodies,etc., and in respect of expenditure relating tonatural calamities, if a token provision has been madein the budget, the expenditure need not be treated as"New Service tl when the sanction actually issues.However, such cases should be brought to the notice of.the Legislature by specific inclusion in theSupplementary estimates.

(G.O.Ms.NO.1157, Finance (BG-I), dated 30.12.B6)

(b) When the estimated Cost of a scheme,whether new or extension of an existing scheme, iswithin the monetary limits mentioned above they areNew Schemes. In addition, the following schemes willbe treated as New Schemes and not as New Services.

t

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. (i) Employment of additional staff for apurely temporary need for a specific period during afinancial year if the cost does not exceed Hs.S lakhs

~ recurring or Rs.IO lakhs non-recurring.

(ii) Employement of additional staff fornormal increase of work involving no change in policyor the sanction of any new scheme ...

• (iii) Irrespective ofindividual purchase of Tools andspecific provision in the Budget.

thePlant

costwhen

onthere

theis

,

•

(iv) Ways and Means Advances, but they must bebrought to the notice of the Legislative Assembly ~n

the next session.

(v) Expenditure on existing service under onehead but involving provision of funds under adifferent head within the same section due to changein classification of expenditure~

(vi) Cases already approved by the LegislativeAssembly but where the expenditure is subsequentlyexpected to exceed appreciably the amount originallyintimated to the Legislative Assembly.

Note.-But information regarding largevariation should be given in the Budget Memorandum.Full information should be furnished to the FinanceDepartment by Departments of Secretariat in time forincorporation in the Budget Memorandum.

(c) All New works (Non-new service) costingHs.50,ODO and above sanctioned in the course of theyear and not provided for in the original budgetshould be reported to the Legislative Assembly bymentioning in the Annexure to Supplementary Estimates"a

(d) All cases of transfer of gift ofGovernment Property of a value exceeding rupees onelakh to autonomous bodies, other Governments, etc~

should be brought to the notice of the LegislativeAssembly by inclusion in the Budget Memorandum.

~


171. The Government will not be prepared tosanction a "New .Service" or a "New Instrument ofService ft for introduction in the course of a financialyear unless it satisfies one of the followingcriteria:

( i)sanctioningmachinery of

It is so essential that delayit is likely to Cause break-down inadministration.

inthe

"

(ii) it is highly remunerative.

(ii 1) it relates to addItional staff requiredvery urgently for a project (i.e., large constructionwork), already sanctioned.

(iv) delay incause permanent loss of

sanctioning it, is likelyrevenue to Government~

to

(v) It is Centrally-sponsoredassisted scheme which is, therefore,Government of India and other autonomous

or Centrallyfinanced by

institutions.

The following classes of schemes to bethe COurse of a financial year should bethe Standing Finance Committee of thethen to the Cabinet before orders

the schemes are issued :-

172.introduced inreferred toCabinet andlanctioning

(a) All schemes of new expenditure treated as"New Service" or, "New Instrument of Service".

(b) schemes involving expansion of staff inehe existing departments when the cost of staff.xceeds Rs.4,OO,OOO and upto RS+S,OO,OOO per annumrecurring or if it exceeds Rs~5,OO,OOO and upta~5.10,OO,OOO non-recurring.

•the cost ofRs.IO,OO,OOO

Schemes involving works whenRs.7,SO,OOO and upto

( c)

works exceednan-recurring.

•

(d) Schemes involving purchase of Tools andPlant and cost of such purchase exceeds Rs.4,OO,OOOand upto Rs.5,OO,OOO non-recurring.


(e) Schemes involving the constitution of acommittee and cost thereof exceed RS.75,OOO and uptoRs.l,OO,OOO per annum recurring or if it exceedsRs.l,sO,OOO and upto Rs.2,OO,OOO non-recurrring.

(f) Schemes involving sanction of,Grants-in-aid and Contributions and the cost'of suchGrants-in-aid and Contribution exceeds Rs.l,SO,OOO andupto 2~OO,OOO per annum recurring or if it exceedsRs.3,OO,OOO and upto Rs.5,OO,OOO non-recurring.

(9) Schemes involving sanction ·ofGrants-in-aid and contribution the like of which hasnot been voted in the past and if the cost exceedsRs,7S,OOO to RS.l,OO,OOO recurring or if it exceedsRs.l,SO,OOO and upto Rs.2,OO,OOO non-recurring.

(h) Schemes involving revision of scales ofpay and allowances when the cost exceeds Rs.B,OO,OOOand upto Rs.IO,OO,OOO per annum recurring.

(i) Schemes relating to Experiments,Investigations and Demonstrations when the costexceeds Rs.l,sO,OOO and upto Rs.2,OO,OOO per annumrecurring or if it exceeds Rs.4,OO,OOO and uptoRs.S,OO,OOO non recurring~

Schemes involving additional investmentsRs.7,SO,OOO and upto Rs.lO,OO,Ooo in an

Government Company with the paid up capitalone Crore and below.

( j )exceedingexistingof Rupees

(k) Schemes involving additional investmentsexceeding Rs.20,OO,OOO and upto Rs.25,OO,OOO in cases

-, where the paid up capital of the existing GovernmentCompany is more than one Crore.

(1) Schemes involving additional investmentsexceeding Rs.40,OO,OOO and upto Rs.SO,OO,OOO in anexisting Departmental undertakings.

(ro) Schemes involving additional investmentsexceeding Rs.8,OO,OOO and upto Rs.lO,OO,OOO in theex~sting Private Sector Companies and Private

8~/21--G,


Institutions with the paid up capital of Rupees onecrore and below~

(n) Schemes involving additional investmentexceeding Rs.15,OO,OOO and upto Rs.20,OO,OOO in the ,existing Private sector Companies and PrivateInstitutions. with paid up capital of mo~e than Rupeesone crore.

(0) Schemes relating to subsidy involved inconcessional sales such as sale of raw materials toPrivate Institutions at concessional rates and sale of,Pesticides, Agriculture implements, etc., exceedingRs.2,OO,OOO and upto Rs.3,OO,OOO recurring andRs.4,OO,OOO and upto Rs.5,OO,OOO non-recurring. whenintroduced for the first time, exceeding RS.7,OO,OOOand upto Rs.10,OO,OOO in case of additional subsidypassed on to Public and Rs.4,OO,OOO and uptoRs.5,OO,OOO in case of additional subsidy passed on toInstitution5~

(p) Schemes involving the abandonmentexisting revenue when the amount of revenue toforegone exceeds Rs.SO I OOO per annum recurringRs.3,OO,OOO non-recurring when the scheme involveschange of policy.

ofbeor. '

a

(q) Schemes involving expenditure onObjects and Purposes when it exceeds Rs.2,OO,OOOupto RS.3,OO/OOO recurring and Rs.4,OO,OOO andRs.5,OO,OOO non-recurring.

,N~w

andupto

(r) schemes involving loans ,to GovernmentCompanies Local Funds and Private Parties etc.,exceeding the Budget provision for a scheme by Rs.25,laks or 10% of the Budget provision for the schemewhichever is higheL, exceeding Rs.S lakhs whenspecific provision is not included in the budget andexceeding Rs.l lakh in the case of the expenditure onloans the like ·of which has not been incurred in thepast.

lG.O.Ms.No.777, FinanceIBG-I)Oeptt., dated 14.l0.l99ll

"Exceptions


•. (i) Recoverable expenditure.-Schemes of newexpend-iture which are not treated as "New Service ll or

- ;'New Instrument of Service" and the cost of which is'fully recoverable from another Government, Local Body'or Private Body or Individual whatever be the amountof expenditure to be incurred initially by theGovernment.i

.. (ii) Rural Welfare Schemes-Schemes to beIfinanced from the Fund for Village Reconstruction andi~Harijan Uplift.L.·...,. -, (iii) Grow More Food Schemes.

(iv) Remission ofl::'temission of revenue to beC" ~i th an established pol icy.

Revenoe.-Proposale forsanctioned in accordahce

173. Procedure for sanction.-TheAdministrative Departments of the secretariat

:'~oncerned with each scheme should, after the~xamination of the scheme by the Finance Department,

!'take orders Ln circulation to the Minister orMinisters concerned, the Minister for Finance and theChief Minister. If it is decided that the scheme~~hould go before the standing Finance Committee, the: department concerned should prepare a summarising nate-which should contain all details regarding the scheme

including the full financial implication in thefollowing form:-

SUMMARY OF COST

-Major/Sub- Minor l Sub-head, Ultimate cost Cost inMajor head Detailed and the yearof account Sub - detailed Recur- Non- of intro-

heads of account ring. Recur- duction.ring.

11 ) ( 2 ) (3) (4 ) (5 )

Rs. Rs. Rs. Rs.


NOTES.-(i)The estimate of cost in the year of'·introduction should be based on the best estimatepossible of the probable date of introduction andother relevant factors. The ultimate cost should beworked out On the basis of the average pay in regard:to new staff.

•

(ii) A statement should be annexed at the end·,,:of the note showing.-

Acutalmonthunder

(b)

(a) Budget provision under the major head ofaccount; > ••

.. 1

Expenditure to the end of last-·'for Which figures are available.l'the major head of account; :i ~

(C) Estimateschemecurrent

of extra expenditureunder consideration

year; .

onin

thethe·

(d) Savings in the budget provision for otheritems included in the major head;

(e) Total commitmentmajor head of(not providedsanctioned sincefinancial yearpreceding month;

in the year under theaccount of new schemes; -

for in the budget)the beginning of theupto the end of theand

( f) Total commitment in the year under allmajor heads (in the Revenue Section·or the Capital Section as the case maybe) on account of the new schemes (notprovided for in the budget) sanctionedsince the beginning of the financial"year upto the end of the precedingmonth.

•

(b) The summarising note should also·incorporate the views of the administrativedepartments and the Finance Department and the views'of the Minister or Ministers concerned and the'


,

•

Minister in-charge of the Finance~ The draft noteshould be sent to the Finance Department foracceptance. Copies of the note as finally approvedshould be circulated to all the Ministers and theconnected file with four spare copies of the note sentto the Secretary to the Standing Finance Committee,i.e., the Deputy Secretary, Finance Department. TheSecretary to the committee will initmate to alldepartments the date, time and place of each meetingof the Committee as soon it is settled. He willarrange to refer to the Committee from time to timesuch of the cases received by him ~pto the weekprevious to the date fixed for the next meeting as areselected by the Chairman for inclusion in the agenda~

After a scheme has been considered by the Committeethe file will: be returned to the administrativedepartment concerned with the recommendation of thecommittee recorded on it by the Secretary to theCommittee. The department of the Secretariatconcerned should then take necessary action to referthe scheme to the Cabinet for approval at its nextmeeting, before final orders are issued except inevery urgent cases.

(C) In every urgent cases, when there is notime to re,fer a scheme to the Cabinet, ordera may beissued without such a reference provided that theStanding Finance Committee is unanimous about theurgency of the scheme and the necessity for it~ Inslich cases the departments, summarising note shouldcontain fUcll reasons as regards the urgency. If thereis. any difference of opinion among the members of thecommittee about the necessity and urgency of a" schemethe case should be referred to the Cabinet before theis?ue of orders. As soon as the recommendation of theSt~nding Finance Committee approving the scheme hasbeen obtained a note marked "Special" intimating thedecision of the Committee should be circulated to eachof the Minister who had not seen the case or who arenot members of the Committee. A copy of this notetogether with a copy of the note placed before theSt~nding Finance Committee should at the same time befurnished to the Chief secretary. The circulation ofthis note should not be delayed even when the draft

160.


order has to beSecretariat before

seen by otherissue.

departments of the

174. Short Circuit Procedure:-In respect ofschemes relating to centrally Sponsored /assisted(i.e .• Schemes which are fully/partly financed byGovernment of India) and schemes relating to naturalcalamities j -the Department of Secretariat concernedshould, after examination of the scheme by the FinanceDepartment, take orders in cicculation to the Ministeror Ministers concerned, Minister in-charge of Financeand the Chief Minister. Sanction for all oth~r "newschemes i.e., schemes other than those relating toCentrally sponsored/centrally assisted and naturalcalamities will be accorded only in the StandingFinance Committee meetings to be held periodicallY..Orders may then be issued wichout referri~g the ca~e

to ~he Standing Finance Committee if that courss h~5

been approved by all the Ministers to whom the casewas circulated. As soon as orders have been issu~d

sanctioning a 'Scheme adopting this "Short CircuitProcedure" the summarising note marked "Special.'·explaining the' nature of the scheme and its extremeurgency and the amount of expenditure involved shouldbe circulated to each member of the Standing Finance,Committee who did not see the c~se when orders we~e

obt~ined on it and ail other Ministers who had notseen the case and the Chief Secretary and the FinanceDepartment.

175. Procedure in cases not requiring areference to the Standing Finance Committee.-In casesof new schemes which do not require a referenc~ to theStanding Finance Committee, the AdministrativeDepartments of secretariat concerned should takeorders in circulation to the Minister or Ministersconcerned J Minister in-charge of Finance and the ChiefMinister as the case may be as shown below :-

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•.~ ., c:..' ": •...:. '" ,-' ~'.~ :-:

, THE' 'TAHIL NADU BUDGET HAloIUAL-~ ,-,.I ._, ,,_

, ,

,- -'"

161 . ,

Serial number and Monetary limits. Circulation up to.items of eXpenditure.

(1 J (2) (3)

1. Expansion of staffin the existingDep.H tntents -(i) Recurring 1. Over Rs.1S,DDD to Rs.25,OOO 1. Minister Concerned.

2. Over Rs.2S,DOO to Rs.2,OO,OOO 2. Minis.ter in-charge of. Finance.3. Over Rs.2,OOfOOO to RS.4,OO,OOO 3. Chief Minister.

<ii) Non-~ecurring 1. Over Rs.50,OOO to Rs.l,OO,OOO 1. Minister concerned.Z. Over Rs.l,DD,OOD to Rs.3,OO,OOO 2. Minister in-charge of Finance.3. O~er Rs.3,OO,OOO to RS.5,OO,OOO 3. Chief Minister.

2. works - •Non- recurri ng 1. Over Rs.1S,OOO to Rs.25,OOO 1. Minister concerned.

2. Over Rs.2S,OOO to Rs.S,OO,ODO 2. Minister in-c~arge of Finance.3. Over Rs.5,OO,OOO -to ks.7,SO,OOO 3. Chief Minister.

3. Expend; ture to be 1. Over Rs.1S,OOQ to Rs.2S,DOO 1. Minister concerned.met from 1I.,,!>- s,"", Z. Over Rs.25,OOO to Rs.S,OO,OOO 2. Minister in-c~ar9~ of Finance.provision in the 3. Over Rs.5,OO,ODD to Rs,7,SD,OOO 3. Chief Minister.Budget.

4. Tools and PlantNon-recurring 1. Over Rs.1S,DOp to Rs.2S,ODD 1. Minister concerned.

2. Over Rs.2S,OOO to Rs.2,OO,ODO 2. Minister in-charge of Finance.3. Over Rs.2,OO,OOO to Rs.4,DD,OOO 3. Chief Minlster.

5. Expenditure on newobjects .nd putpos~s

(i) Recurrfng 1. Over Rs.S,OOO to Rs.10,OOO 1. Minister concerned.2. Over Rs.10,OOO to Rs.SO,DDD 2. Minister in-charge of Finance.3. Over Rs.SO,DOO to RS.2,OO,DDO 3. Chief Hinister.

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• "THE 'TAMH'~AOU 'BUOGET' MNlfA'l .,. "",,-, " '.,"_ ..

•

163

~

9. Revision of scates ofpay and allolofam::es(i) 'Recurr i"9 ,. Upta Rs.5.000

2. Over Rs.5,OOO ta Rs.5,OO,OOO3. Over Rs.5,OO,OOO ta Rs.8,OO,OOO

1. Minister concerned.2. Minister in-charge of Finance.3. Chief Minister.

10. E~periments,

lnvestigations andDemonstrations(1) ~ecurr1n9

(il) won-recurring

11. Loans to GovernmentCompanies. LocalFunds and Privateparties, etc.

1. Over Rs.l0,OOO to RSL2S,OOO2. Over Rs.25,OOO to Rs.1,OO,0003. Over Rs.l,OO,OOO ta rs.l,50,OOO

1. Over Rs.20,000 to Rs.50,OOO2. Over Rs.50,000 to Rs.2,OO,OOO3. Over Rs.2,OO,~OO ta Rs.4,OO,OOO

1. When there is speciflcprovision in the ~udget whenthe expenditure e~ceeds

the Budget provision fora scheme by Rs.25 lakhs or10 per cent of the budgetprovision fer the scheme~hichever is tess.

2. When specific provision lSnot included in the Budgetwhen the Loan is uptoRs.5,OO,OOO.

3. Expenditure on leans, theLiKe of which has not beenincurred in the past, if theexpenditure ~s upto R$.1 lakh+

1. Minister concerned.2. Minister in-charge of Finance.3. Chief Minister.

1. Minister concerned.2. M1nister in-charge of Finance.3. Chief Minister.

1. ~inister concerned.~inister in-charge of Finance.Chief Minlster'.

2. Minister concerned.Minister in-charge of Finance.Cnief Minister.

3. ~inister concerned.~iniste, in-charge of Finance.Chief Minister.

164

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THE TAMIL NADU 6UDGET MANUAL

4~ ~ays and Means AdYances tolocal Bodies, Go~ernment

Companies and CO'operativeInstitutions, etc., need natbe tre-ated as a "New SerY'ice"nor covered by an advance fromthe Contingency Fund ; but theymust be brought to the noticeof the LegisLaturE in the nextsessioli.

4. Minister concerned •Minister in-charge of Finance.

12. Investment'S In

Governme~t Companiesand Dep~rtmental

Undertakings ~

(1) ExistingGovernmentcompany withpaid-up capital 01Rupe~s one ,Croreand be tow.

1. ~pto Rs.5,OO,OOO 1. Minister co~cerned.

Minister in-charg~ of Ft~ance.

2_ Over Rs.5,OD,OOO to Rs.7,50,OOO 2. Chief Minister.

1. Upto Rs.1D,DO,OOO

2. Over

-{ii) ExistingGovernmentCompany with thepaid-up capital ofmore than Rs~' Crore.

Rs.10,OO,OOD toRs.20,OO,OOD

1. Minister concerned.Minlster in-charge of Finance.

2. Chief Minister.•

(li;) Additionalinvestment in ane)(istlngdepartmentalundertaking.

1. Upto Rs.25,OO,DDD

2. Over Rs.2S,OO,ODO toRs.40,OO,ODO

1+ Minister concerned.Minister ;n-chatge of Finance.

2. Chief Minister.

1. Upto Rs.5,OO,OOO

2. Over Rs.5,OO,OOO toRs.8,OO,ODQ•."_'~ ""." I '_

~

13. Investments in thePrivate Sector Companiesand Private [nstitutionsby Goverrvnent -(i) Paid-up~~apitaL of

Rupees one Croreand beLow.

)"

1~ Minister conerned.Minister in-charge

2. Chief Min1ster.-of Finance~

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Non-recurrin9

(i i) Addit; on.lsubsidy' passedon to Public~

_,'; >~_:' ,1'

(ii) Paid-up capitaLof more thanRs.1 Crore.

Subsidy ,nv~lved inconcessionat salessuch as sale of rawmaterials to Privatelnstitutions atconcessional rates,subsidised sale ofpesticides, agriculturalimplements, etc. -(i) When subsldy is

_introduced for thefirst timeRecurring

165

1. ~inister concerned.~inister in-charge of Finance.

2. Chief Minister.

-1. Mlnister concerned.

Mini"ster in-charge of Finance.2. Chief Minister.

1. Minister concerned.Minister in-cnarge of Finance.

2. Chief Ministel.

1. Minister concerned.Minister in-charge of Finance.

2. Cl1ief Minister.

~. 1~'Minister concerned.Minister in-~harge of flnance.

2. Chief Mlnister.

MANUAL,J~E~.TiAMliL!lADU BUDGET.'",,' "j·'~'c~'~~': "T. Upto Rs.l0,DD,OOD

I. Upto Rs.2,OO,OOO

2. Over Rs.2,OO,OOO toRS.4,OO,ODO

1. Upto Rs.S,OO,OOO

2. Over Rs.5,OO,OOO toRsJ,DD,OOO

1. Upto RS.2,OO,OOO

2. Over Rs.2,OO,OOO toRs.4,OO,OOO

1. Upto Rs.l,OO,DDD

2. Over Rs.',OO,OOO toRS.2,OO,OOO

2. Over Rs.10,OO,OOO toRs.15,OO,OOO

Addi t i ana t.subsidy passed onto Institutions.

( ; ; i )

14.•

'5. Abandorrnent ofExisting Revenue(i) Recurring 1. Upto Rs.25,OOO

2. Over Is.25,OOO to Rs.50,OOO

1. Minister concerned.Minlster in-charge of Finance.

2. Chief ~inister.

_I-:r~ ,\';;.: ~-~';".: ~ni:·~· :';;, ';'

166

(i i). Non-recurr5 ng

THE TAMI L NADU BOeGE! MANUAL.

1. Upto Rs.1,OO,OOO

2. Over Rs.1.00,OOO toRs.3,OO,OOO

1. Minister concerned.Minister in-charge of Finance.

2. Chief Minister.

NOTES.-(i) If a question of policy is invol~ed in any case, the administrative"departmentconcerned should decide in accordance with the instructions in the Business Rules whether theorder of the Cabinet should be obtained.

(ii) the Finance Department ~jll ask for circulation to the Minister in-charge of Financein any case if the e~penditure 1S important or of an unusual nature or involves any hew principLeor policy.

176. Under the Constitution of Ind)a~ expenditure on a liNe ... Service" or IINew InstrlRentof servicell sanctioned in the course of a financial year cannot be incurred untH the approval oftne legislatlve Assembly is specificalty obtained by including provislon, whether substantlve ortoken in a supptementary statement of expenditure presented to the leglslatlve Assembly andeventually 'in an Appropriation Act. Howe.... er, if the sch-e-Ille 1S so extremely urgei1t that itsintroduction Cannot be delayed~ the expenditure Dn the scheme will be met 1nitially by ~n advancetakeh from the Tamil Nadu Contingency fund pending approval of the Leg~slative Assembly. In suc~

cases, the order sanctioning the scheme will specificallY state that the expen diture which willbp debited to the appropriate heads of Account will be initially met by Bn advance from theContjngen~y Fund and tnat orders in this regard will be issued separately from the FinanceDepartment on receipt of necessary application from the Heads of Department in t~e prescribedform indicating th~ probable amount required to be sanctioned from the Contingency Fund~ ~ copyof the order as soon as 1t is issued together with information as to the cost llkety to beincurred 1n the current year ShOUld be sent to the Finance Department for sanctioning the advancefrom the Contingency Fund. Care should be taken to see that the expenditure on each scheme doesnot e~ceed th~ amount of Conting~ncy Fund advance sanctioned to it .

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177 .Serv i -cel' forAssembl y, atrequired forestimate thethe probabletoken granti mpl kat-i onsestimates.

•

Al~ schem£oS of new expenditure sanctioned as liNe ... Service" or "New [nstrument ofintroduction in the course of a year should be placed before the Legislativethe earLiest opportunity by presenting a supplementary estimete far the amountexpenditure on them during the year. ~here it is not immediately possfble to

additional appropriation required with reference to the progress of expenditure andsavings in respect of the relevant grant as a whole, a supplementary estimate for a

may be presented to the Legistative Assembly. In aLi cases, the fuLL financialon the scheme should be explained in the explanatory note accompanying supplementary

~..

CHAPTER XI

BUDGETARY IRREGULARITIES

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178. Alikely to ariseillustrative and

list of Budgetaryis given below. The

not exhaustive :-

irregularitieslist is only

(i) Excess expenditurethe Legislative Assembly orappropriation;

over a grantover a

voted bycharged

( ii)necessitating

Defective orlarge surrender

inaccurateor resulting

budgeting,in exceSSi

(iii) Defective controlresulting in -

of expenditure

grants;(a) unnecessary or excessive supplementary

•

(b> unnecessary or excessive re-appropriations;

•

(c) injudicious re-appropriations and surrenders causing excess over allotments.

(d) unspent and unsurrendered appropriations;

(e) unremedied or uncovered excess; and

(f) late allotments;

(iv) Misclassification of expenditure;

(V) Re-appropriations which are not made inaccordance with the rules in this Manual or which havethe effect of increasing expenditure on an item theprovision for which has been specifically reduced by avote of the Legislative Assembly;

(vi) Expenditure on a "New Service" orInstrument of Service" not covered by a vote ofLegislative Assembly, unless the requisite fundsbeen arranged by obtaining an advance fromContingency Fund before incurring expenditure;

•

"Newthe

havethe


(vii) Expenditure incurred without allotmentof funds;

(viii) Expenditure incurred without propersanction or in anticipation of sanction of thecompetent authority;

(ix)required f<;>r

Drawal fromimmediate use;

treasury of moneys not,

.~

(x1 Abandonment of revenue without prope~sanction and;

(xil Any large claim against Government, localbody or other outside party. allowed to remai~

outstanding for an undUly long time.

179. (a) the several budgetary irregularities.arise mainly due to lac~ of proper control ofexpenditure, lack of an information system on whichproper bUdget can be formulated, and lack ofco-ordination between the different departmentsresponsible .for the execution of a scheme and themisclassification of expenditure which arise out oflack of continuous and careful watch of expenditurethrougLout the year. For a proper control of;expenditure, several registers have been prescribed:for maintenance by the disbursing Officers,;Subordinate Controlling Officers and Chief ControllingOfficers. These registers should be maintainedproperly ·and correctly. The Chief controlling,Officers should see that monthly reconciliation offigures with those of the Accountant-General and theData Processing Centre is completed in time.

(b) To avoid misclassification of expenditurethe Disbursing Officers shall write in every bill thecorrect and full classification before presenting itat the Treasury.

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CHAPTER J[I!.

APPROPRIATION ACCOUNTS, FINANCE ACCOUNTS ANDAUDIT REPORT .

180. In accordance with the provision of theConstitution, the ComptrDller and Auditor-Generalprepares the Finance Accounts of the Government eachyear as also the Appropriation Accounts indicating thetotal amounts of grant/appropriation as contained inthe Schedules to the Appropriation Acts, the actual~xpenditure and the variations under the severalgrants/appropriations. The accounts are prepared bythe Accountant-General on behalf of the CDmptrollerand Auditor-general of India and are signed by theComptroller and Auditor-General Df India. 8esides,the RepDrt of the CDmptrDller and AuditDr-General ofIndia dealing with the points arising out of theseAccounts and other irregularities noticed in thecourse of audit of financial transactions of theGovernment is also prepared by the Accountant-Generaleach year and is countersigned by the Comptroller andAuditor-General of India.

181. The Appropriation Accounts of eachgrant/appropriation indicate the originalgrant/appropriation, additional funds provided duringthe year by supplementary grant/appropriation, theexpenditure incurred, saving 0; excess and the amountsurrendered during the year. As thegrants/appropriations are for the gross amountrequired for expenditure, the expenditure figuresshown against them do not include recoveries which areadjusted in the accounts as reduction of expenditure~.

• (i) This is followed by "Notes and Comments"which will bring to the notice of the Legislative~ssembly (giving relevant particulars 9f the groupheads) excesSeS Over grants/appropriations requiringregularisation expenditure booked against thegrant/appropriation but not really debitable to it,expenditure incurred on a "New Service" withoutspecific authority of the Legislative Assembly,unjustified or excessive provision of funds leading to

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170 TH~ TAMIL NADU BUDG~T MANUAL

large savings and lapses and also cases of defectivecont~ol over expenditure, e.g., excessive{ irregularor unjustified reappropriations or surrenders withinthe grant/appropriation. If a part of the expenditure •under a grant is met from special funds, depositaccounts, grants made by outside bodies~ etc' r briefnotes indicating the nature of the funds and thesummary of the transactions pertaining to the year arealso included.

{ii} The Finance Accounts present the receiptsand outgoings of the Government for the year. Thefigures of actuals shown in these accounts are netafter taking into account the recoveries. Theypresent the accounts of the transactions underConsolidated Fund, Contingency Fund and the Publi'cAccounts and the accouncs of the assets andliabilities of Government such as Debt and Loans andAdvances by GoveLnment. Information Lega~ding

guarantees given by Government, investments ofGovernment, etc., is also given in this compilation4

('ii) The Report of the Comptroller andAuditor-General of India mainly relates to mattersarising from the Appropriation Accounts and FinanceAccounts of the year together with other pointsarising from the audit of the financial transactionsof Government4 It indludes points of interest noticedin the Audit of "Receipt", accounts of GovernmentTrading Activities, Stores and Stock Accounts, etc.Ordinarily the financial irregularities, losses; etc.,included i~ the report relate to cases which came tothe notice of audit during. the year as well as thosewhich had come to notice in earlier years but CQuidnot be dealt with in earlier reports; mattersre~ating to the period subsequent to the period underreport are also included, wherever considerednecessary.

182. (a) All Heads of Department and ChiefControlling Officers should keep ready the explanationfor all variations between the original and finalgrant and between the final grant and actualexpenditure, so that the draft appropriation accoun~s

•

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•

sent to them by the Accountant-General may be returnedto him within a fortnight of its receipt after due~crutiny of the figures and with the explanqtions

• required. It should be noted that explanations ·haveto be furnished to the Accountant-General forvariation in all cases, irrespective of the amount.j.nvolved though most of them may not be finallyincorporated in the appropriation accounts .

(b) The following further instructions shouldalso be carefully observed by all Heads of Department

•

• nd Chief Controlling Officers--

, (i) Explanations for variations should beconcise, accurate and fully informative and shouldcontain information as to whether the variation was'inevitable and Whether it could not be foreseen.

(ii) Vaguely worded phrases such as "originalprovision proved in!3ufficient or exces5ive', I1based onprogres6 of actuals, etc." should be avoided.

o (iii) It should be specifically stated why the:priginal provision proved insufficient or excessive...and how and why the actuals varied from the estimates.

(iv) In cases where the variations are due totransactions adjusted or adjustable by' other Accountsofficers in respect of suppLies received from ~ther

qove~nments, etc., the circumstances in which theliaison between" the indenting and supplying

,departments could not secure adequate control ofexpenditure should be stated.

(V) the explanations should clearly specifyxhe schemes, project, etc., which remained unexecutedand accounted for the savings, together with thereasons therefor, 849., non-receipt of sanctions,stores, etc., or the schemes or other objects which

·were taken up with no allotment or inadequate.~rovi5ion of funds as the case may be and also~ndicate Why the savings/excesses could not be",~nticipated in time and the savings surrendered/the~xcess regularised before the close of the year.........

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(vi) If the variation is due to more than onecause l the amount due to each cause should be stated.Variations mentioned by the Accountant-General in theaudit report will ordinarily be considered by theCommittee on Public Accounts, which will make suchrecommendations as it may deem necessary, afterconsidering the administLative departments~ notesbased on the explanations of the Chief ControllingOfficers for the variations. The explanationsobtained by the administrative departments for thevariations not considered by the Public AccountsCommittee should be forwarded'with the Administrativedepartments' remarks to the Finance Department, whichwill request the administrative department, whennecessary, to draw the attention of the ControllingOfficer concerned to any instance of defectivebudgeting or control of expenditure in order that itmay not be repeated.

183. (i) The draft of a paragraph proposed forinclusion in the Report of the Comptroller andAuditor-General of India is forwarded by theAccountant-General to the secretary to Government witha copy to the Head of the Department concerned with a

•demi-official letter so as to ensure that ' theirregularity commented upon is brought to the personalnotice of the officers who will have to appear aswitnesses before the Public Accounts Committee whenthe Report of the Comptroller and Auditor-General ofIndia is taken up for consideration. The officerconcerned should verify the correctness of the factscontained therein and communicate the result of thevariation to the Accountant-General within six weeksfrom the date of receipt of the draft.

(iil The reply to the audit paragraph shouldbe sent after examining all the aspects of the casesand after getting the specific approval of theSecretary to Goverment Dr the Head of the Departmentconcerned. The officers should collect all the factswhich have a direct or indirect bearing on theirregularity commented upon in the draft paragraph andsee that the facts and figures mentioned in the auditp.aragraph are correct. I f the draft paragraph

,

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proposed by the Accountant-General requiresmodification so as to bring forth the full facts ofthe case, they should indicate this in their replies.The reply to the draft paragraph should be sen~ in ademi-official letter from the officer to whom it wasreferred by the Accountant_General for verification.This will ensure that the reply is sent by the properauthority after careful examination of all the aspectsof the case. In case a final reply to fhe draftparagraph cannot. be given within the limit of sixweeks referred to above, an interim reply should begiven indicating the time by which the final reply canbe sent. In any case, the final reply should be sentwithin three months from the date of receipt of thedraft paragraph. Every effort should, however, bemade to send the replies within the time-limit of sixweeks, since the Accountant-General includes in theFinal Report of the comptroller and Auditor-General ofIndia paragraphs for which this period of six weekshas elapsed.

, (iii} To ensure prompt replies to draftparagraphs received from audit., Secretaries .toGovernment and Heads of Departments may open as~parate register to note the date of receipt of theaudit paragraphs and also the date of reply to Audit.The register should be personally verified by theofficers On the first working day of each month.

(iv) A draft paragraph forwarded to theSecretary to Government for verification will normallyfind a place in the Report of the Comptroller andAuditor-General of India which will be placed on theTable of the Legislative Assembly. The report of theComptroller and Auditor-General of India' so placedwill be examined by the Public Accounts committee andthe concerned Secretaries to Government should appearas witnesses before the Committee when it examines theparticular paragraph in the Report of the comptrollera~d Auditor-General of India. There will be a timelag ranging from six months to one year between thedate on Which the draft paragraph is forwarded by theAccountant-General for verification and the date onwhich the particular paragraph is taken ,up ,"for.:"':"

. i 8;;/21--6A,


consideration by the Public Accounts Committee.Usually, the Public Accounts Committee examineswhether at .·least after the receipt of the draftparagraph, the irregularity commented upon in the ,audit paragraph has been rectified wherever possible,whether adequate steps have been taken to see thatsuch irregularities do not recur and also in cases ofloss to Government whether necessary action has beentaken to· recoup the loss and prevent such losses infuture. If the secretary to Government and the Headof the Department concerned take prompt actionimmediately on receipt of the draft paragraph. torectify the defects and to proceed against theofficers responsible to make good the losses incurredby the Government due to their negligence and alsoissue detailed instructions for the avoidance ofrepetition of such irregularities, it should bepossible to satisfy the Committee that theirregularity has since been rectified and that actionhas also been taken to avoid a recurrence of suchthings in future. Hence Departments of Secretariatand the Heads of the Departments, should on receipt ofdraft paragraph, examine, among other things, thefollowing aspects and take suitable remedial measureimmediately -

(1) Whether the irregularity committed was dueto negligence or capability on tbe part of anyGovernment servant (if so,' suitable action should beinitiated against him).

•

(2) Whether there was lack ofinstructions or defect in the organisationaland if so, steps taken to rectify the defects.

properset up

•

(3) If there was loss to the Government,responsibility for the same should be fixedsteps taken to recover the loas.

theand

,(4) If the irregularity committed was due to

lack of proper supervision or ambiguity in the rules,steps should be taken to enforce adequate supervisionor to amend the rules.


All possible ways should be thought of toprevent a recurrence of such an irregularity and alsoto make amendments for the irregularity committed.

184. On receipt of the authenticated copies. of the Appropriation and Finance Accounts and the-Reports of the comptroller and Auditor-General ofIndia thereon in terms of Article 151(2) of theConstitution, the Finance Department will obtain the

'orders of the Governor for laying the copies beforethe Legislative Assembly and then move the LegislativeAssembly Secretariat to aerange foe the item relatingto the laying of these documents before the House ofthe Legislative Assembly being included in the agenda

.of business of the House.

•

185. (i) Aftee the Appropriat.ion Accounts,Finance Accounts and the Repoet of the comptroller andAuditor-General of India thereon are laid on the tableof the House, they shall stand referred to thecommittee on Public Accounts for examination andreport.

(ii) If they are received by the AssemblyDepartment at a time when the Assembly is not insession, then these may be referred to the Committee

"on PubliC; Accounts by order of the Speaker.

The Committee on public Accounts is aof the Legislative Assembly and is

under the Tamil Nadu Legislative Asse~bly

constitution and functions of thiSdescribed in Chapter XIV.

186.CommitteeconstitutedRules. TheCommittee are

•

•

187. If any money has been spent on anyservice during the financial year in excesS of theamount granted by the Legislative Assembly for thatpurpose or in excess of charged appropriati0nauthorised earlier, the Committtee shall eKamine withreference to the facts of each case the circurnstance

\ leading to such an excess and make suchrecommendations as it may deem fit.

85/21--6B_."._- ,

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•


•

188. Excesses over total final appropriationunder the several grants, whether in the charged or inthe voted section as recommended by, the PublicAccounts Committee should be included in statement ofexcess expenditure which will be presented to theLegislative Assembly as described in Section VI of,Chapter IX .

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•

CHAPTER XIII .

COMMITTEE ON ESTIMATES.

.. .l 1894 The Committee on Estimates is aCommittee constituted by the Legislative Assembly forthe examination of such of the estimates and may deemfit by the Committee or are specifically referred toit by the House. The constitution and the functionsof the Committee are regulated by the Tamil NaduLegislative Assembly Rules as may be in force fromtime to time.

190: Thestated in the rules

functions of the Committee,in force at present, are -

as

~a} to report what economics, improvements inorganisation, efficiency or administrative reform,consistent with the policy underlying the estimatesmay be effected;

(b) to suggest alternative policies into bring about efficiency and economyadministration;

orderin

laidthe

examine whether the money is welllimits of the policy implied in

tothe

and

( c lout withinestimate;

(d) to suggest the form in which the estimatesha11 be presented to the Legislative Assembly.

•

•

191. (a) The Committee shall consist of sixteenmembers in addition to the Finance Minister and theChairman of the Committee on Public Accounts, and theChairman of the Committee on Public Undertakings whoshall be members ex~officior of whom not more thansixteen members shall be elected by the Assembly fromamong its members according to the principle ofproportional representation by means of singletransferable vote.

(b) The term of office of the Members of theCommittee shall not exceed one year, and there shall

--.-._ .._- - .. ---. .'

l" 85/21--6C

,

•


be fresh election before the end of the year forconstituting a Committee for the ensuing year; and ifunder any circumstances such an election is not held,the existing members of the committee will continue tohold office until new members are elected.

(c) casual vacancies shall be filled as soonas possible after they occur in the manner prescribedin paragraph 191 (a) and any person elected to fillsuch a vacancy shall hold office for so long aa theperson in whose place he is elected would have heldoffice. •.

192. The Chairman of the Committee shall b~

nominated by the Speaker from amongst the members ofthe Committee. The person so nominated shall presideat the meetings of the committee and in his absence,one of the members of the Committee elected by theCommittee shall preside.

193. The sitting of the Committee shall beheld on such days and at such hour as the Chairman ofthe Committee may fix, provided that if the Chairmanof the Committee is not readily available, theSecretary may fix the date and time of a sitting.

194. (a) The Committee may, if it thinks fit,make available to the Government any completed part ofits report before presentation to the Assembly. S~ch

reports shall be treated as confidential untilpreaented to the Assembly.

•

(b) The committee may hear officials orevidence connected with t-he estimatesexamination. It shall be in the discretion ofCommittee to treat any evidence tendered beforesecret 0r confidential.

takeunder

theit as

•

(C) For purposes of paragraph 194(b) theCommittee shall have power to require the attendanceof the persons or the production of records anddocuments: provided that Government may decline tbproduce a document on the ground that ita disclosure~~,d not be in the public interest.

•


195. The Committee may continue itsexamination of the estimates throughout the financialyear and report to the House from time to time as itse~amination prOceeds~ It shall not be incumbent on

1 the Committee to examine the entire estimates of anyone year. The demands for grants may be voted uponnotwithstanding the fact that the Committee has maden", xceport.

196. The department or departments whoseestimates are to be examined by the Committee will be~~quested by the Secretary of the Legislative AssemblySecxcetariat who is also the Secretary to the Committeeto furnish necessary material in support of theestimates for the information of the committee. Thetorm in. which the material is to be furnished to theCommittee shall be as follaws:-, .

I (il The organisation of the department and itsattached and subordinate offices. (the informationshould be shown in the form of a diagram supported byshort explanatory notes.)_', C

(ii) The functions of the department and its~ttached and subordinate offices~

(iii) Broad details on ~hich the estimates arebased.

(iv)>-

'?-ttached andof estimatescomparison,years.

Volume of work in the department and itssubordinate offices covering the period

and giving, for the purp,0se ofcorresponding figures of the past three

•

'" (V) Schemes or projects which the department~as undertaken. (the name and details of the scheme,the estimates of expenditure r period within whichlikely to be completed, yield, if any, progress madeto date, should be stated).

:>1 (vi)s.\lb-head ofyears+

Actual expenditure incurred underestimateg during the preceding

eachthree


the(vii)

actuals ofReasons for variations~ ifthe past years and current

any, betweenestimates.

(viii) Reports, if any.department on its working.

issued by the•

(ix) Any other 'information that the Committeemay call for, or the department may think it necessaryor proper to 'give.

197.thirty-five196 to thecirculation

The department concerned will furnishsets of papers, referred to in paragraphLegislative Assembly Secretariat for

to the Members of the Committee.

198. An advance copy of the Report of theCommittee marked as "Secret" will be sent to thedepartment concerned far verification of factual'details and for such action a's may be necessary. Thedepartments concerned shall treat the contents of tnereport as "secret" unti lit is presented to the

, Assembly.

199. . The Chairman may make such factu'a'lchanges in the draft reports as he may think fit onthe basis of the changes intimated by the departmentconcerned before the reports are presented to tWeAssembly.

benalf~OO.

of theThe Chairman

Committee.shall sign the reports on

201.presented tohis behalf by

ia) the report of the Committee shallthe House either by the Chairman or

any other member of the Committee.

beon

•

(b) Recommendations in the reportCommittee shall be taken into account in theformulation within the overall provision ..

of theBudget

•

;;.,."sixteenand the

..~.hairman

•

•

•

CHAPTER XIV.

COMMITTEE ON PUBLIc ACCOUNTS.,j

202. The Committee on Public Accounts is aCommittee of the Legislative Assembly for the~~~amin~tion of accounts showing the appropriation of,(s,ums granted by the House for the expenditure of theState Government, the annual Finance accounts of theState Government and such other accounts laid beforethe House as the Committee may think fit.,.

203. (i) the Committee shall consist ofmembe,rs in addition to the Finance MinisterChairman of the Committee on Estimates and the

of the Committee on Public Undertakings who" .

.~nall be members ~ex-officio, of whom, not more thanlsixteen members shall be elected by the Assembly from~mong its members, according to the principle ofproportional representation by means of the singletransferable vote.

(ii) The term of office of members shall not,exceed one year. There shall be fresh election before.the end of the year for constituting the Committee and,:.~f I under any circumstances, such an election is not.held, the existing members of the Committee will"continue to hold office until the new members areelected .

..... -

(iii) Casual vacancies shall be filled as soonas possible after they occur, in the manner prescribed·~n paragraph 203(i) and any person elected to fill.such vacancy shall hold office for so long as theperson in whose place he is elected would have heldoffice.

(iv) The Chairman of the Committee shall benominated by the Speaker from amongst the members ofthe Committee. The person so nominated shall presideat the meeti~gs of the Committee and in his absence,one of the members of the Committee elected by theCommittee shall preside.

182 • THE TAMIL NADU BUDGET MANUAL

204. Functions of the Committee.-The PublicAccounts . Committee shall scrutinize the appropriation~CC0unts of the State and the report of theComptroller and Auditor-general of India, therein andsatisfy itself-- •

(a) that the moneys shown in the accountshaving been disbursed were legally available forapplicable to service or purpose to which theybeen applied or charged.

asand

have

(b) that theauthority which governs

expenditureit; and

conforms to the

(c) that every reappropr iation has been made'.,in acc.ordance with such rules as. may be prescribed by, ..the Governor or by the Finance Department as the case.may be.

The committee shall bring to the notice of theAssembly--

(i) every case in whichsatisfied; and

it is not so

(ii) all expenditure which theDepartment has requested should be broughtnotice of the Assembly.

Financeto the,

It shall also be the duty of the PublicAccounts Committee -

"

(a) to examine such trading, manufacturingprofit and loss accounts and balance sheets, asGovernor may have required to be prepared andComptroller and Auditor-General's report thereon;

and ..the ..the I.'

(b) to consider the report of the Comptrollerand Auditor-General in cases where the Governor mayhave required him to conduct an audit of any receiptor to examine the accounts of stores and stbcki

•

Ie} if any money has been spent Onduring a financial year in excess of

anythe

serviceamount


makeits

Suchuntil

•

•

granted by the House for that purpose, the Committeeshall examine with reference to the facts of each casethe circumstances leading to such an excess and makesuch recommendations as it may deem fit; and

(d) The Committee may, if it thinks fit,available to Government any completed part ofreport before presentation to the Assembly.reports shall be treated as confidentialpresented to the Assembly.

205. The Committee shall have power torequire the attendance of persons or the production ofrecords and documents, if' such a course is' considerednecessary for the discharge of its duties, providedthat; Government may decline to produce a document onthe ground that its disclosure would not be in thepublic interest~

.206. The Committe will meet at such days ,and

at such hour as the Cha-irman of the Committee may fix;provided that if the Chairman of the committee is notreadily available, the Secretary may fix the date andtime of a sitting. The secretary to the LegislativeAssembly· serves as Secretary to the Committee and hewill int~mate the time and place of each meeting andsend the ,agenda and connected papers to the members,Five members, including the Chairman,' or the memberpresiding will constitute quorum far a meeting.

207. la) On the basis of the Report of theCOmptroller and Auditor-General qf India laid on theTable of the House the Legislative AssemblySecretariat prepares a Memorandum of Important Pointsthat will be taken up for consideration by the Public

• Accounts Committee and communicates it to thedepartments of Secretariat~ As the Public AccountsCommittee- can meet and examine the points only whencomplete replies are furnished by the Departments, theSecretaries to Government concerned should bestowtheir personal attention in the matter of furnishing,replies to the Legislative Assembly Secretariat to thepoints included in ~he 'Memorandum' within one monthat the latest.

•


•

(bl The Departments. of Secretariat shouldprepare self-contained notes on all items to bediscussed by the Committee and submit them to theSecretaries concerned sufficiently in advance of themeeting. The Secretary to Government who is calledupon to appear as a witness will no doubt studythoroughly all the papers and files connected with th~

subject including the original records relating to t~e

case of the subordinate officers as well as the filein which the draft paragraph forwarded by theAccountant-General was examined and replied to. Theserecords should be made available to the Secretary toGovernment at the time of examination by the PublicAccounts Committes. A compr~hensive note covering ai'laspects of the Case should also be prepared indicatingclearly the chronological order in which t~e

Government took remedial action in the case. Whethera similar irregularity had found place in any of theearlier reports of the Comptroller and Auditor-Gener~l

of India should also be verified and if there was sucha case, the relevant papers relating to that case, therecommendations of the Public Accounts Committee onthe sUbject and the action taken by the Government o~

the recommendations should be looked into and fullinformation On this should be made available, at th~time of examination by the Committee. Replies bywitness should be accurate and precise ~and t~~

statement made before the Committee should be capable,of being proved with reference to records. Ifinformation on any point raised by the Committee isnot readily available, the fact should be intimated tothe Committee and time for furnishing it asked fDr~Vague and generalised replies by witness an?expressions of opinion and presumptions in replying toquestions by the Committee should be avoided~

208. The Secretary to Committee, thesecretary of the administrative department· of thesecretariat concerned, and the Accountant-General oran officer deputed by him{ will ordinarily attendevery.meeting of the Committee~ It is open to theCommittee to require also the presence of any head ofa department or any other Government servant atparticular meetings when sUbject with which he is

•

•


concerned are considered. The Accountant-General maybe assisted by the gazetted office~ of his office whoinvestigated a pa~ticula~ case. TheAccountant-General may offer suggestions on the~aints to be conside~ed by the Committee.

209.(af The ~ecommendations of the Committeewill be embodied in a ~epo~t approved by the Committeeand signed by the Chairman on behalf of the Committee.This repo~t will be presented to the LegislativeAssembly either by Chai~man or on his behalf by anyothe~ membe~ of the Committee. But the ~eport willnot be taken up for conside~ation by the House as amatter of course. If, howeve~, on a later date thereis any need for the House to consider the report, willbe taken up on a motion given notice of by any member.it will then be open to the Assembly to discuss thereport and to make additional recommendations to theGovernment ~n connection with matters dealt within thereport, if it so desires.

(b) The Legisltive Assembly secretariat willfD~ward cDpies Df the ceport of the Committee 'and therecommendations of the Legislative Assembly thereon to~he Accountant-General.

(c) Recommendations in the report:Committee shall be taken into account in theformulation within the over-all provision.

of thebudget

•

210, Action to give effect to therecommendations of the Committee and of theLegislative Assembly will be taken by the department~oncerned but the Legislative Assembly Secretariat isresponsible to see that such action is taken. Actiontaken by the departments concerned on therecommendations of the Committee shall be communicatedby them to t~e Assembly Secretariat, the FinanceDepartment and the Accountant-General J Tamil Nadu .

211. A statement showing the action taken oc•p'roposed to be taken on ths recommendations of the

Committee by the vacious departments of the Governmentshall be p~epa~ed by the Assembly Sec~etariat in

186 THE TAMIL NADU 8UDGET MANUAL

consultation with the Finance Department and shall beplaced before the committee. The Committee willexamine the replies regarding the action taken andwill report to the House in its next repor~ whether itconsider the action taken by the department to be.adequate or otherwise.

212. The Legislative Assembly Secretariatwill bring up-to-date the "Epitome of the reports ofthe Committees on Public Accounts" at intervalsordinarily of five years.

213. The Accountant-General in his next andsubsequent Appropriation Accounts and his reportsthereon and the Comptroller and Auditor-General ofIndia in his comments On those accounts may refer tothe action which has been taken by the Government inrespect of cases previously reported by him and maycomment on the adequacy or other-wise of the actiontaken by the Government.

214. The procedure fordemands for excess grants hasSection VI of Chapter IX.

dealing withbeen described

thein

CHAPTER XV.

• ". L L

\ '"

ESTIMATES FOR CENTRAL (AGENCY) SUBJECTS.

•215 .

used in thisassigned torequires:-

The following words and phrases, whenchapter will have the meaning hereby

them unless the context otherwise

Administrative Department meansadministrative department of the Government ofNadu

anTamil

FinanceDepartment of the

DepartmentGovernment of

meansTamil

theNadu.

Finance

Government means the State Government of TamilNadu, acting as Agent of the Central Government, inthe administration of functions entrusted to them Inreiation to Central sUbject.

unit of Appropriation means a lumpsumby the Central Government at the

Government acting as Agent of theunder sOme or all of the following

Primaryof money placeddisposal of theCentral Governmentheads, viz.,

Code No( 1)

DBscription( 2 )

STANDARD DETAILED HEADS

85/21--7,

•

01020304050607080910111213

SalariesWagesDearness AllowancesTravel ExpensesOffice ExpensesRent, Rates and TaxesPublicationsAdvertising and PublicityGrants-in-aidContributionsSubsidiesScholarships and StipendsHospitality/Entertainment Expenses

188 THE TAMIL NADU BUDGET MANUAL,

Code No(1 )

Description( 2 )

STANDARD DETAILED HEADS --cont. .-

Reserves

•

,J

, ,

,-

, -

•

Sumptuary AllowancesSecret Service ExpenditureMajor WorksM.inor WorksMaintenanceMachinery and EquipmentTools and PlantMotor VehicleInvestmentsLoansMaterials and SuppliesInterestDividendsPensionsGratuitiesDepreciationInteL-Account Transfe~5

Writes off and LossesSuspensePayment9 for Professional and Special servicesother ChargesRoyaltyInternational Programmes

I •Payments out of Discretionary Grants for HigH;

DignatoI:"iesDeputation/Travel Abroad of ScientistsRewardsDiscount on Loansother DiscountsService or Commitment ChargesCost of RationArms and ~mmunition

P.O.L. (Petroleum, Oil and Lubricants)Clothing, Tentage and Storesstores and EquipmentForeign AllowancesFestival AdvancesAdvancesCompensationGifts

38394041424344454647484950515253

14151617181920212223242526272829303132 ~

3334353637

Code No( 1 )


Description(2 )

189

•STANDARD DETAILED HEADS --cant .

54 Expenses On Conducted Tours55 Fees to Staff Artists56 Feeding and Cash Doles57, Purchase of Food Grains58 Central State Transfer of Resources59 Prizes and Awards60 T.A./D.A. to Non-Official Members61 Refunds62 Notional Value of Gifts Received63 Customs Duty64 Lands65 Buildings77 Deduct-Recoveries78 Deduct-Recoveries (SuspEnSe)80 Lumpsum Provision

NON-STANDARD DETAILED HEADS.

Code No.(1 )" .

Descripcion(2 )

•

66 Medicines67 Feeding/Dietary Charges68 Cost of Books/Note Books/Slates, etc.,69 Procurement of Agricultural In-puts.70 Unemployment Relief71 Printing Charges72 Training73 Transport Charges74 Purchase and Up-keep of Animals75 working Expenses99 Misce11aneoLls

[G.O.Ms.No.800, Finance. IBG.II) Deptt., dated26.7.90J

216. The Government administer at present, asthe agent of the Central government, the CentralSUbjects specified in Appendix H in respect offunctions relating to them in this state. Thefollowing is a summary of general instructions issued


for the guidance of estimating officers and others inrespect of estimates of revenue and expenditurerelating to these subjects.

•217. The estimates of revenue and expenditure'

in India should be prepared by the estimating officersin round thousands of rupees, and these of revenue and-:'expenditure in England in multiples of Rs.l,OOO or

50. The estimates of expenditure should be preparedin two parts; part-II should include all items of newexpenditure which, under the procedure in this behalf'prescribed by the Central Government have to be placedbefore the Standing Finance Committee of theParliament and Part-I, th~ rest of the estimates.

ESTIMATES OF REVENUE AND PART-I EXPENDITURE

"

218. Except in the case of estimates relatingto Public Works, the estimating officers mentioned inAppendix H will forward their estimates of revenue andof Part - I Expenditure to the Accountant .... General '.The Accountant-General will transmit these estimateswith his remarks and also the estimates for which' h~'

is the estimating officer to the concerned·~administrative department and the Finance Department~ i

The administrative department will forward the copY'received by it with its remarks to the FinanceDepartment. The estimates relating to Public Workswill be sent by the Chief Engineer direct to thePublic Works Department, which will refer them to theAccountant-General and send them to the FinanceDepartment with the remarks of the Accountant-General.

Thethe severalAppendi" H.

dates by which the estimates should reachauthorities mentioned are given in

219. The Finance Department will return tothe administrative department with its remarks r if ~•any, the copy of the estimates received from thelatter. The Administrative department including theFinance department, When it is the administrativedepartment{ will communicate the Government's finalorders on the estimates to the Accountant~General.

The revenue estimates as approved by the Government


•

•

wi,11 be included by the Accountant-General ~n theconsolidated estimates whicp he sends to the FinanceMinistry of the Central Government. The estimatesrelating to Part-I - Expenditure as finally approved,will be forwarded by the Administrative department tothe concerned administrative Ministry of the CentralGovernment by such date as may be prescribed by thelatter for this pu~pose, except for the estimatesunder the head "2071. pensions and other RetirementBenefits" which will be sent by the Accountant-Generalto the Ministry of Finance l Government of India.

ESTIMATES OF REVENUE AND PART-II EXPENDITURE

220. Proposals for new expenditure(Part-III should be submitted by estimating officersdirect to the Administrative department during thecourse of the year, as soon as the necessity for theexpenditure comes to natice~ without reserving themfor a consolidated report at the time of theSUbmission of the budget estimates for the ensuingyear. They should be submitted not later than thedate when the Part-I - Estimates are forwarded to theAccountant-General unless a different date has beenspecifically prescribed. in this behalf. Theadministrative department will, after examining thePart-II - Estimates in consultation with the FinanceDepartment, forward them with such modifications asmay be decided upon to the concerned administrativeMinistry of the Central Government.

COMMUNICATION OF THE FINAL ESTIMATES OF THECENTRAL GOVERNMENT.

221. After the Budget is voted by theParliament, the estimate sheets of expenditure,including new expenditure, if any are forwarded by theMinister of Finance of the central Government to theFinance Department. The latter transmits the sheetsto the Administrative department concecned forcommunication to the estimating officers. The sheetsrelating to revenue heads are forwarded by the CentralGovernment to the Accountant-General who communicatesthem to the estimating officers concerned.

•


PART-II - EXPENDITURE.

CONTROL OF EXPENDITURE

•

c.'_

222. The allotment under each detailed head •of appropriation such as salaries, wages, travelexpenses, office expenses, etc., is ordinarily fixedby the central Government as the primary unit bf,appropriation for purposes of financial control. Butit is open to the Government to sub-divide the prima'ryunit into secondary units, if this is considerednecessary for the proper discharge of the agencyfunctions. In the case of Public Works, for examplethe primary unit "original works" has been sub-dividedinto the secondary units "major works" (theappropriation for each major work being a secondaryunit) and "minor works" (the appropriation for thelatter being a lump sum for all such works) .

The sanctioLled appropriation for a particularunit, primary or secondary as the case may be, shouldnot ordinarily be exceeded. Except in respect ofitems for which the Accountant-General is theccntrolling authority, viz. '0070. other AdministrativeServices~, '2012. PresidentjVice-President/Covernor/A.dministrator of Union territories' f ~2070. OtherAdministrative services.' and ~2071. Pensions andother Retirenient Benefits', the Government isresponsible for seeing that the expenditure is keptwithin the sallctioned appropriation~ ~,'

•

The estimating or other officers mentioned inAppendix J at whose disposal funds are placed shoulda~cordingly keep a constant watch over the progress ofexpenditure and have a correct idea of the liabilitiesstill to be met. They may distribute the allotme'ntsto officers subordinate to them l but should requirethem similarly to watch the progress of expenditureand to keep the expenditu~e within the amou~ts

distributed to them. •

223. FOl:expenditul'e, i.e.,appropriation, the

the purpose of controlling theto keGp it uithin the sanctioned. .

officer concerned wi_II follow su~h

•


procedureindicatedrespe-ct of

as is most convenient.below should, however,the lleads mentioned -

The procedureb" followed in

• ,."2061. External affairs" .-Refugees and State

Prisoners and Profession tax to the Corporation ofl~adras for the American COlls~late Officers in_)M.adras-The expenditure will be watched by the Public

Department with the aid of monthly statement of theLactuals received from the Accountant-General.

"3075. Other General Economic Services,'Regulation of Joint Stock Companies" ,-In regard to.~

,,_ expendi ture under Joint stock Comp~nies, the Register. 6f Joint Stock Co~paniel ~il1 folloll the instructions,.laid dOlm for the control of State el<pel1diture.

"2059. Public <loz-J:s" .-In the case of thesecondary unit "original ~V'orks-Major Works", theDivisional Officer will be re~pons~ple that -

(i) no Gxpenditure is incurred on any major. .../ork""without a specific appropriation for it except in.~he case of unfinished worl~ of the previous year which,~s likely to be completed in the budget year forHs.SOO or less;

(ii) the expenditure on each :original majorwork is limited to the amount of the specificappropriations sanctioned for it, and the excessexpenditure over appropriation, unless the excess isRs.SOO or under is covered at once by an additionalallotment of funds;

,

•

,. (iii} the total expenditure on all"_major \-Jorks of the divi!3ion under each

appropriation does not exceed the totalappropriation made therefor .

originalunit ofof the

In respect of expenditure relating to the,secondary unit "Minor Works" and other Primary andsecondary units the Divisional Officer will beresponsible to see the expenditure is kept within theappropriation for each unit pLaced ~t his disposal.


224. As soon as the accounts of a month are,closed, the ~ccountant-General will furnish eachcontrolling authority mentioned in Appendix J with acomplete statement of his charges. In those cases in'which departmental accounts are maintained, thecontrolling authority concerned will compare thefigures in the departmental accounts with the figure~

of the Accountant-General and reconcile discrepancies,.if any by correspondance. If the. controllingauthority does not report any discrepancy, theAccountant-General will assume that his figures areaccepted.

225. Surrender of savings.-Where theexpendi~ure under a unit is expected to be less thanthe authorized appropriation, the savings should besurrendered to the administrative department concernedthrough ~he Accountant-General immediately unless itis foreseen, it is required to meet 'excess expenditureunder some other unit or units which is definitelyforeseen at the time. All savings will be surrenderedby the concerned administrative department to thecorresponding administrative Ministry of the CentralGovernment by the dates prescribed for the purpose.

226. Supplementary grants. -Before anapplication is made for a supplementary grant to meetexcezs Bxpenditure under a unit or units, it shouldfirst be examined whether the excess expenditure canbe met from savings or by effecting special economicsunder other units. Normally the Central Governmentwill not entertain an application for a supplementarygrant unless ,the anticipated excess is due to causesbeyond the control of the authority concerned andfunds cannot be found by any legitimate postponementof expenditure for which provision already exists. Anapplication for supplementary grant should besubmitted as soon as its necessity becomes apparent,accompanied by a full explanation of the reasons forthe excess and of the impossibility of providing fundSto meet it.

•

•

IIrespect ofactivitiesService" in

•supplementary grant should ordinarily be inextra exp~nditure required for the normalof the~·department. Expenditure on a oj Newthe technical sense, and on new items such

THE TAMIL NADU 8UDGET MANUAL 195

•

as new buildings, new roads, etc., for whichno provision exists in the budget should be incurredin the middle of a year only in exceptional Cases.The Central Government are averse, as a generalprinciple, to admitting such expenditure during thecourse of a year for the reason as to why it was notprovided for in the original budget. When however itis urgently necessary to incur such expenditure, andthis cannot be postponed for consideration in the nextyear' s:~).E_udge~ should be fully and clearly explained.Ordinarily the Central Government will not agree toexpenditure on a "New ·Service" or item in the courseof a year which cannot be covered by savings orspecial economics within the grant unless it relatesto a matter of r~al imperative necessity or isaxpected to result in an increase of revenue or ishecessary for the safisguardlng of existing revenue~

227. Re-appropriation of funds.- An officer

of the Government has no power to sanction anyre-appropriation out of funds placed at his disposalfor a central (agency) sUbject. The administrativedepartment may re-appropriate funds from one primaryunit to any other such unit, provided that -

(1) no re-appropriation is made from one grantto anotheri

are not'versa ;

(ii) funds allotted fot charged expenditurere-appropriated to meet votable items or vice

(iii) nO re-appropriation is made to meet anyexpenditure which is likely to involve further outlay:in a future financial year; and'.

• unitunit

.J.

( i v)allottedallotted

no appropriation is made from aunder the head "Salaries" to a

under any other head .

primaryprimary

CHAPTER XVI.

PERFORMANCE BUDGET.

,228. The normal functions of the budget are.to ensure accountability of the amount spent ~ t'o_serve as a financial plan for realising the objectivesof the departments and to serve as an instrument ofGovernment policy. In the context of the large'increase in the size and magnitude of Governmentalactivities over the past two decades, their increasingcomplexity and ,the consequent new role of Governmentin their management t modern methods and techniques ofproject and financial management have become necessary:to ensure efficient utilisation of resources. In..other words it has become far more important ,.and.,essential that the budget~serves as an instrument for"taking decisions about the manner in which thereSources could be used to attain the objectives ofGovernment. The existing budgetary systems do notadequately enable the fulfilment of this purpose sincethey have a predominant bias towards' a legalaccountability interpreted in a some-what narrowerway. The developmental plans need a budgetaryframework which lays emphasis on physical andfinancial targets, On the measurement of financialcosts and benefits.

229. In the field of budgeting, the need has.accordingly been felt for the system which will focusiattention on what the Government is doing in terms oftheir programmes,' activities and projects, their costaand quantitative data, reflecting planned tasks andtheir performance in both financial and physicalterms. Recognising the deficiency of our present·budgetary structure which fail to adequately linkf inancia"l outlay to physical achievements, theAdministrative Reforms Commission of the Government ofIndia in its report on "Finance Accounts and Audit"has recommended that departments and organisations indirect charge of development programmes shouldintroduce performance budgeting, a technique which haa:'been hailed as the management's approach to budgetingand financial control~

• •

•

• I


•

230. Performance Budgeting-Definition.-Theemphasis in performance budgeting is anaccomplishments rather than on the means ofa~complishment on the precise definition of work to bedbne or service to' be rendered rather than on 'detailregarding money spent on the several items~ Aperformance budget seeks to present the purposes ando~jectives for which funds are requested l the costs ofvarious programmes and activities proposed forauhieving the objectives and guantitative datameasuring the work performed or services rendered orresults accomplished under each programme andactivity. In brief, performance budget is acomprehensive opeLational document, conceived,presented and impl~mented in terms of programmes,projects and activities, with their financial andphysical aspects closely inter-woven.

J 231. In the ordinary budget. hitherto, theclassification of account was adopted to record, the

•receipts and expendi~ure under different groups ofheads and it aimed only to ensure accountability. Inorder to have a meaningful classification andpresentation of Government operation, in terms offunct{ons, programmes and activities/ etc. a revisedobject-wise classification of accounts has beenadopted with effect from the budget for 1974-75. Theobject-wise classification provides a "link betweenbudget outlays On the one hand and functions programmeand schemes on the other hand and at the same timeensuring itemwise control of expenditure.

,.,232.

by performance,"

The main purposesbudgeting are :-

sought to be achieved

(b) to improve bUdget formulation, review"anddecision making at all levels of operation in theGovernment machinery;

,

(a) toaspects of every

correlate the physical and financialprogramme, project or activity;

(c) to facilitate better appreciation andreview by Legislative Assembly;


(d)performance

toaudit;

make possible more ef fective

(e) to measure progress towards long term andshort term objectives as envisaged in the plan; and.

(f) to bring annual bUdgets and annual planstogether through a COmmon language.

233. While the ordinary budget shows fundsprovided for different activities under differentheads, the Performance Budget shows ho~ much isprovided for each activity, organised meaningfully.It enables uS to understand the budget better.

•

234.department is

The Performanceprepared essent,al1y

Budgetin three

for eachsections:-

(A) Instructure andgovern the work

the first instance the organisationalthe broad set 'up of objectives thatof the department are indicated.

(8) This is then followed by a "FinancialRequirements Table" which is the most important partof the Performance Budget. Its three basic elementsare :-

(i) A programme andindicating the range of

•meaningful categoLiesi

activity classificationwork classified into

(ii) Object-wise classification showing thesame amount distributed among the different objects ofexpenditure such as establishment charges, travelexpenses, etc.; and

(iii) Sourcesbudgetary heads underprovided.

of financing indicating thewhich ~he funds are being

•(C) The, third section of the Performance

Budget relates to the "Explanation of FinancialRequirements"4 In this section, the programme ofaction under each activity is indicated with as much

,I


supporting physical data as is possible and relevant.The work transacted during· the period and the targetsof work for next year are brought out clearly in this'section. Wherever possible, tabu lar statements

• showing the physical targets and past achievements arealso given. In case of significant variations betweenRevised Estimates and BUdget Estimates the reasons forsuch variations are also laid down.

235. Performance Budget is prepal~ed inrespect of the following departments presently by the~oncerned administrative department iTl the$ecretariat :-

(i) A.griculture .

•(ii) A.nimal Husbandry .•

{iiil Backward Classes.

liv] Collegiate Education.

Iv] Community Development.

(vi) Fisheries.

(vi~) Fot"est.

(viii) Handlooms and Textiles.

(ix) Adi-Dravidar and Tribal Welfare.

(x) Highways and Rural Works

(xi) Industries

(xii) Irrigation and Ground Water

(xiii) Medical Education

{xiv} Medical Set"vices and Family Welfat"e

{ •

200

•

•


'(XV) PUb~ic Health and Preventive Medicine4

(xv i) Public Works

~ xvii) School Educatir,Jn"

(~;viii) Social Welfare

(xix) Technical Education

•

, .

I

: i

,

.'

•

•

201

CHAPTER XVII

ZERO BASELINE BUDGETING FOR ACCELERATED GROWTH(Ze-BAG)

236. A budget is a comprehensive andcoordinated Plan of activities expressed in financialterms for the operations and resources of an entityfor a specified period in the future. This isprepared in order to achieve the objectives of theentity. Under the conventional or incrementalbudgeting system, the budget for a period is basedlargely on the levels of expenditure of the previousperiod, with minor changes (generally inCreases).This bUdgeting process makes the implicit assumptionthat the' existing allocation of resources is by andlarge correct and can continue in the future. Also,the base to which the increment is added is usuallytreated as though it were already authorised andrequired very little additional review or evaluation.

237. The method of preparing the Budget inGovernment is based on the incremental system. Thismeans that the first charge on the available resourcesis that of expenditure relating to on-going schemes.Only the resources available after meeting theexpenditure on all the on-going schemes are allocatedto new schemes. The procedure in regard to 'Part IIBchemes'~ as. these new schemes are known, has beendescribed in Chapter-IV of this Manual. Everydepartment of Government proposes several schemeswhich are necessary and desirable in themselves, andif money could somehow be found they would all betaken up in the year. However, the funds availableare limited and, therefore, many good schemes have tobe postponed in order to balance the budget.

238. Under the existing system, on-goingschemes are rarely put to serious test. Provisionsare generally made for the on-going schemes year afteryear without any scrutiny regarding the basic need tocontinue the schemes. Adjustments are usually madeonly for changes in prices and rates, as also newexpenditure on expansions and new starts~

( ,


239. In order that on-going programmes andschemes and the provision of f~nds for them arecritically reviewed periodically, Government haveintroduced a system of Zero Base Budgeting under whichthe expenditure on even the on-going activities has tobe justified. The concept encompasses bothnon-development and development expenditure. ZeroBase Budgeting requires identification and sharpeningof objectives, examination.of various alternative waysof aChieving those objectives, selecting the bestalternative through cost-benefit andcost-effectiveness analysis, prioritisatian Qfobjectives and programmes, switching .of resources fromprogrammes with lower priority to those with higherpriority, and identification and elimination ofprogrammes which have outlined their utility. Theobjective of Zero Base Budgeting is not just to cutthe expenditure but to make a more purposiveallocation of resources to various prograromes~

240. The zsB process, which has beenimplemented from the year 1988, ·has been modified,based on the experience gained to suit Government'soperations. The modified process to incorporateGovernment's role and functions, structures andoperations which took effect from 1992-93 is calledZero Baseline Budgeting for Accel~ated Growth(Ze-BAG) .

are:-24L The four steps involved· in the process

(A) THE DECISIONUNIT:

(S) THE DECISIONPACKAGE:

(Cl THE RANKINGPROCESS:

i.e., identification of thedepartment's organisationalstructure, objectives,management and DECISIONUNITS.

i~e., analysis of decisionunits and developing theDECISION PACKAGES.

i.e., Review and rank Decision packages.

•


(D) BUDGET i.e., aliocation of departmental resources and preparation of detailed BUdget.

, Tn following the ZBB approach in Government, some'adaptations are considered necessary. In theGovernment budget, a department usually operates underone or two major heads~ a few minor heads and a large

'number of subheads. A few standard objects of·expenditure like salaries, subsidies, etc., give the-:details under the subhead. A subhead usually; incorporates all activities relating to a scheme. The-analytical process should therefore -focus on every. subhead, the subhead usually corresponding to a"decision unit. In cages where there are a few-'decision units within a subhead, the analysis can go. below the subhead level. The ZBB approach should beto look into the continuance of the whole scheme asreflected by the subhead, consider elimination ifobsolete or unwarranted, reduce the level or increasethe level.

242. In the modified process of Zero Baseline-Budgeting applied for accelerated growth (Ze-BAG) the;focus shall be in reviewing and reordering priorit~es

in a holistic manner. The Ze-BAG exercise shall set. out all the goals and specific objectives of the,department. The organisation structure in a completemanner should be spelt out clearly spelling out thenumber of poste at different levels4 Unit costs ofState level direction, regional level costs, districtcosts and immediate superviaion c08~e should bearrived at and checked for efficiency. All unit costsare to be rechecked and CrOBS checked and tested forefficiency. The effort should be to carefullyevaluate costs versus service level rendered, after·undertaking the main analysis of what kind of servicesshould be provided in the changing context. Theminimum level of activity should be finalised based onintrospective review.. Determination of the minimumlevel of activity, though finally a value judgement,has to be grounded in detailed information on publicperceptions of service levels and the costs. Theeffort would be to maximise public good at the lowestcost.

l

)

•


243. After a detailed analysis of adepartment is undertaken as outlined in paras 6 and '7above, a report will be prepared by the Head ofDepartment in association with Finance Departmentwhich is the nodal department to implement Ze-BAG.'The Ze-BAG report so prepared will be reviewed by aCommittee consisting of -

-,

'secretary of the Administrative Department,'"Secretary, Financesecretary, Planning and DevelopmentSecretary, Personnel and AdministrativeReforms Department

5. Head of Department

1.2.3 •4.

Based on this review, a report of the Committee willbe prepared as in the Annexure to this chapter in i'standard format. These reports will be a permanentrecord and form the basis for future decisions. These'reports will be utilised in the preparation of thebudget both Part I and Part II. As a clear signal toencourage this process and eliminate waste, the fundsne~ded for new activities/increased level ofactivities as may be considered desirable in thereport to the extent savings are found will be addedto Part II of the Budget over and above the'predetermined departmental ceilings.

244. The Ze-BAG exercise is intended to be apowerful process to continuously evaluate Government'srole and reassess needs. The Head of Department isrequired to completely involve himself in the process.While Finance Department will take up a nodal role thebasic exercise has to be done by the Head ofDepartment.

245. There should be no misconception thatthe Ze-BAG exercise is to merely identify surplusstaff. In a fast modernising world many jobs can be'done more efficiently with fewer people. The surplusstaff can be utilized for new projects/programmes oruses. If absolute reduction is called for in theabsence of new activities, this Can be achieved byf~eeZing the filling up of vacancies of entry level,

•

•

THE TAMIL NADU BUDGET MANUAL 205'

declaring the surplus and utilizing the surplus in anyother department, where there is need. It may becAear that the Ze-BAG process will enable location ofsurplus staff and redeployment but will not generallyinvolve any disbandment/retrenchment.

246. The Ze-BAG process will be a continuousone and will be implemented in an integrated mannerwith the regular budget process.

247. Heads of Department shall extend fullco-operation in this process. Outstanding work inthis regard will come in for due recognition.Secretaries to Government shall review the performanceof Heads of Department in implementing this process offiscal correction.

(G.O. Ms. No.267, Finance (B.G.I) Department,dated 18th April 1988).

(G.O. Ms. No.448, Finance (B.G.I) Department,dated 28th June 1988).

(G.o. Ms. No.321, Finance (Z.B.B) Department,dated 11th may 1992) .

••

1---- ~-1 85 / 2 1--7,',

",t·- - .

. 1

,

Format of Report on Zero Baseline Budgetingfor Accelerated Growth (Ze-BAG) in respect ofDepartment of o' ~ .

2. A list of goals and objectivesdepartment together with a detailed list ofcurrently implemented as on 1st April may beAnnexure-I.

,of theschemes

given as

206

l.findings ofreport.

ANNEXURE

A two page executivethe Ze-BAG exercise

summary ofshould be

thethe

mainmain

.'

J. An organogram together with a picture ofstaffing at different levels from the field servicelevel to Directorate may be given. A completeanalysis of costs of staffing at various levels may begiven. This may be set' out in Annexure-II.

4. Unit costs may be checked, efficiencytested against norms. The details of these tests maybe given in Annexure-III.

5. Awhich can bedetails may be

list of schemes/group ofdiscontinued together withgiven in Annexure-IV.

activitiescosts/staff

6. A list of schemes/group of activitieswhich can be implemented at a reduced level togetherwith costs/staff details may be given in Annexure-V.

,7. A list of schemes/activities to

implemented at incteased level.. Detailscosts/staff for increased funding may be given.will be Annexure-VI.

beof

This

8. A list of new worthwhileschemes/activities recommended for funding withdetails of costs/staff may be given in Annexure-VII.

(

•INDEX 207

This index has been compiled solely for thepurpose of reference and no expression used in litshould be taken in any way interpreting the rules .

NOTEparagraphs, unless

The references givenotherwise indicated.

are•

to

A

Abandonment of Existing Revenue

Accounts

Accountant-General adjustments

Administrative Approval

Administrative Reforms

Advance Grant

Agent of the Central Government

Ambiguity

Annual Budget

•Annual Finance Accounts

Annual Budget Estimates

,Paragraph

172 (PI

17(1)

131

17(2)

190(a)

98

215

183(4)

8

17 (37)

17(7) (g)

•

Annual Financial Statement

Appropriation Act

Appropriation Accounts

Appropriation Bill'

Authorisation of Expenditure

2,17(3), 87(ii)

12

17(5), 180, 181

12,90(ivl

l'•

Auditor, India Accounts in the United Kingdom 92

Audit of financial transactions 180•

85/21--7B •

l

20B B

Based on actuals

Based on Progress of Expenditure

Business Advisory Committee

Budget at a Glance

Budget Control

Budget Code

Budget Deficit

Budget Estimates

Budget Estimates~preparatiQn

Budget Irregularities

Budget Outlays

Budget Procedure

Budget Speech

Budget Surplus

Budget Voting

C

cabinet

Calamities Relief Fund

capitalisation

Capital Account•

Cash Credit Accommodation

Central Government's Estimates•

f

Paragraph

lSl(ii)

lSl(ii) -'093(b)

: i ~-,

88,[~

17(7) (e),r' ~"l

5 ( f),.", .. ' .

17(7) (f)

17(7)(g) .., ; ."

8 and 17(7)' ,

178, 179(a),

1 .,.'.. _

B7(i) ,_

17(7 ) (h) ., .:

11 ,c, •

173(b) "

17 (38) ,

4

4, 17(B) •17(9)

16 , . :.

C-cant~ 209

Paragraph

Centrally-Sponsored S(e)III, 143(v)

Charged Appropriati~n 17(11)

Charged Expenditure 7,17(12)

Charges in England 17(13),35,54,63

Charged Section 143(11)

Chief Controlling Officers 17(17),113,114,121,179{a)

Chief Controlling Officer's Register 129•

Classification Structure 5

Commercial BUdget 17(7) (n)

Committee constituted by Government 175(5)

•

Committee on Estimates

Committee an Public Accounts

•Commuted value of pension

Concrete assets

Concurrence of Finance

Consolidated Departmental Estimates

Consolidated Fund of the State

Contingency Fund

Contingency Staff

189 to 201

15,186,202"

4

4

14

56(c)

3(b), 4

3(c), 176

41

Controlling Officer

Control over" Expenditure'- • ~-."T••

85/21--7C'

17(17),105,120,125

11 7 , 118, 119, 120

,

210

Cost Benefit analysis

Council of Ministera

Cuatom" duty

Current asaets

Current Liabilities

Data Centre

Debentures

Debt

Decretal amount

Deduct-Refunds

Defective Budgetary

Demands for Grants

C-CQut.

D

Parag-raph

17(18)

9,84(a)

47

17(19)

17(20)

8,17(21),132(b), 179 I a )

17 (22 )

4

17(23),47-A

27(v)

178(ii)

IDle) ,17(24),86(ii).." :.'

, \

Departmental Estimate

Depreciation Reserve Fund

Deposit accounts

Detailed Budget Estimates

Detailed heads

Disbur~i~g Officer

Discount

Discounted cash flow

Divisions of Public Account

Draft of a paragraph

••

•17(25)

17 (38)

17(26)

24,86 (H'c)

5(v) ,17(28),24

17(29),121,125,179(a1

17(30)

17(31)

6:. i

183(i)

..

E

Economy in Administration

Economy Ln Expenditure, r·--,-

gconomic Planning"'.j ,

Economic Services

Estimating Officer, t, •

Exceptional Grant, ,.,'. T' _

Excess Grant. ,"Excess over allotments~. -.Excess over total grant

Executive Government

Existing Modified Appropriation

Explanation of Financial Requirements

Explanatory notes{ '. :,

211

Paragraph

190(b)

30,190

17(32)

5(b}C

17 (34)

13,17 (35)

17(36)

178(iii} (e)

120(V}

3(c)

17(7) (j)

234(e}

25,28,40

( 7., F

F~nal modified appropriation

-:F.:.i.,scal serv ices

';Fipaoce A.ccounts

Finance Commission

Finance Department

Final grant,Financial Requirements Table

17 (7) (K) ,48

5 (b) A

17(37),180,181 (ii) , ( iii)

87 (m)

215

182(a)

234(8)

212

Fixed Assets

Financial Year

Fleet strength

Fluctuating nature

•F-cont.Paragraph

17(27) (iii)

17(V

45- ,27 (iii)

, t

Functions of Committee on Public Accounts

Funds

G

Gain by Exchange

General discussion

Gross basis

Government Data centre

Grants-in-aid

Grants-in-aidjContributions

'8

Heads of Accounts

Head of Department

High Commissioner for India

Hou~e~ of the Legislature

I

Inaccurate Budgetary

Industrial and other Disputes Act

204

,. 58 (cj

90(i~)

19

,135 (c)

- '.5(b)D,2'7(v)

'.'

5

17(40)

47,56,135

2

- ,

178(ii)

47-A

I-cont.

Injudicious reappropriation, .

J '(nter-Departmental adjus1;ments

~~troduction to Budget,'Inventory Control, ,. .

LLetter of Credit,-Lumpsum Provision

Loans and Advances,•

,Loss or gain by exchange

Leader of the House

. '.,Major Head, .

Major Works,Marketable Securities

Minor Head

Minor Works

'M

5 (a J ( II) ,17 (44) ,24

17(45),43

17(38)

S(a)(III),17(47),24

17(48),43

Management Information System

: ~ iMemorandum of Association

"Misclassification of Expenditur~

N

NEW Expenditure, '

New Instrument of Service~

17(46)

17 (8') (d)

178(iv}

9,17(SO),23(b),3D

17, (51), 143(Ll)153 ( a) , 155 ( a) (i i) ,

169(a) (ii)

214

Non-Plan

Non Statutory

New Service

tlet basis

Non-tax Revenue

•N-cont.

Paragraph

176 ( 5 ) (c) ( i) , 143 (v l,

17(38)'

17(52),153(b) (2)153(c),155(a)(1i)

169(a)(1),176

19

27(v)

,

,Numerical Strength of Officersand Establish~ents

New Scheme

Non .... recurring

Non-recurring grant~

Notes and Comments

Number Statement

o

Office Expenses

Open Market Loan

Original Grant

o£gar.isation of State

Other Est·imates

al.lt f low of Cash

p

P~rt I - Estirnates-

Part II - Estimates

38

153(b)

3 (c) 68

135(d)

181(i)

17(53),39

42(a)

87(1~

182(a)

5 (b) ,

13

17(10)

17(54),22,76(8),83

17(55),23,65 to69,76(8),83

p-cont..

•paid from Contingencies

Paid-up Capital

Part II - Notes

Pe,formance Budget

Plan

215

Paragraph

41

'l(S){C),l72(kl

69

17(7) (0) ,228 to 235

17j56)

Presentation of Budget to the LegislativeAssembly

Primary Units of Appropriation

Programme Evaluation and ReviewTechnique (PERT)

Progressive actuals

Proportional representation

10,90

5{g),17{57)

17(58)

17(7) (e)

191{a)

Public Accounts

Public Account division

Public Accounts Committee

Public Debt:

Q

,Quantitative Statement

Quorum for a meeting

3(d) ,181(ii)

6

17(51),17(60),168

17j7)

206

,Reappropriation

Recognized Policy

Reserve Bank of India

Revised Estimate

R

17(62)

14(a) (iii)

17(7){dl

17{?) (1) ,52(a)

216 R-cont.

Recurring Charge

Remittances

Report of the Comptroller andAuditor General of India

Revenue Account

Receipts in England

Recurring Expenditure

Reconciliation by Disbursing, etc.,Officers

Reconciliation, of Loans and Advances

Recoverable expenditure

Redistribution

Remissions of Revenue

Remittances

Reserve Funds

Revenue Receipts

Ripe for Presentation

Revenue Section

Rural Welfare Scheme

Rounding Off

s

Schemes financed by autonomous bodies

Special Procedures for Public Worksand Forest Departments

Paragraph

•17 (53)

3(d),17(54)

17(55),183(i)

1·-

4{i)

35

58

128,,"

132(c'}

1'72

152

172

3 (d:f

3 (d}

27

,84(a')

173

1·72

20,~

5(e)V, 143(v)

137

~ ,-

special welfare Fund

"tate Plan

State Schemes

S-cont4

,

217

Paragraph

17(38} .

5(e)II,143(v}

17(56}

\ .Standing Finance Committee

Specific Object of expenditure

Social and Community Services

Statutory Fund

Sub-Heads

Sub-detailed heads

Subordinate Controlling Officer

\

67,83,173(c},175

5 (a) (v)

1.7 (3B)

5{IV},17(69)

5(vr,17{68}.24

121, 179(a).

Subordinate Controlling Officer's Register 126

ftandards of-financial propriety

Standing Sanction

~ub""'Major Heads

Sugarcane ceSs

Suspense

Supplementary estimates

supplementary appropriation

14( iii), 120(i)

9,14,17(67),76(b)

S(II),17(70)

17(3B)'

17(72)

47-A,120(v)

140,155(a)

Supplementary Statementof Expenditure

T

Tamil Nadu Contingency Fund

17(52) ,17(71) ,lS3(b) (2)

176

Tamil Nadu Legislative Assembly rules 186,189

•

218

Tax Revenue

Technical sanction

Treasury Bills•

Tools and Plant

Unremedial Excess

Uncovered Excess

T-cont.paragraph

27(v)

17(73)

3 (b)

170(a)4

178(iii) (e)

178(iii) (e)

unprecedent~d Expenditure

Urban Development Fund

vVest in Government

Vice versa

Village Establishments

Vote on Account

vote of Credit

Voted Expenditure

Voting on Demands for grants

voted

Voted Section

wWays and Means Advance

Write Back

zzamindati Abolition Fund

(c)3

17 (38)

4

225(ii)

39

17(74),98,105

17(75)

,17(76)

90(iii) ,95

2

143(ii)

3 (b J

4

87(c)

-Zero base line budgeting

'.. ,printf'n

17 (77) ,235-247

at- r-","''''~nmpnt Central Press. Madras-79.

the tamil nadu budget manual volume i...the tamil nadu budget manual chapter i. introductory. this...

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