CHAPTER I

BROAD FEATURES OF THE DEPARTMENTALISED ACCOUNTING SYSTEM

  

1.1 GENERAL

1.1.1 In exercise of the powers conferred by the 1st Proviso to sub-section (1) of Section 10 of the C&AG's (Duties, Powers and Conditions of Service) Act, 1971 (56th of 1971), the President, after consultation with the C&AG of India has relieved the latter from the responsibility for compiling the accounts of the Union Government (Civil) in stages as on 1st April, 1976, 1st July, 1976 and 1st October, 1976, and from the responsibility for compiling the accounts relating to taxes, duties and other receipts and deposits realised or refunded under any law for the time being in force and administered by the Department of Revenue and Banking including Central Board of Direct Taxes and Central Board of Excise and Customs with effect from 1st April, 1977. With the issue of these Presidential notifications and as on 1st June, 1980, the Comptroller and Auditor General of India stands relieved of the responsibility for compiling the accounts of Central Civil Ministries/Departments and Union Territory Administrations except accounts pertaining to:- app iq option

(i) Indian Audit and Accounts Department;

(ii) Union Territory Administrations of Chandigarh, Dadra and Nagar Haveli and Lakshadweep;

(iii) Pensions including pensions to freedom fighters, their dependents etc., and pensions in lieu of resumed jagirs, lands, territories etc., and pensions and awards in consideration of distinguished services.

  1.2 ORGANISATION OF CONTROLLER GENERAL OF ACCOUNTS

1 2.1 An organisation functioning under the Controller General of Accounts has been created in the Department of Expenditure of the Ministry of Finance. A copy of the Presidential Notification dated the 27th September, 1980 in regard to the functions of the C.G.A. as incorporated in the (Allocation of Business) Rules, 1961 is appended as Annexure 'A'. The C.G.A. will have responsibility for establishing and maintaining a technically sound accounting system in the Departmentalised Accounts Offices. He will, on behalf of the Ministries and Departments, liaise with the Budget Division and the Comptroller and Auditor General of India in accounting matters. He will provide necessary directions in accounting matters to the Ministries/Departments and will issue general instructions about the system and form of accounts and procedures for accounting of receipts and payments. In order to maintain the requisite technical standard of accounting in the Departmentalised Accounts Offices, he will have powers to inspect the offices, and will be expected with his staff, to ensure that accounts are maintained accurately, comprehensively, and in a correct manner. He will also be required to ensure that data and information are supplied in time to the concerned Ministries. Cadre management in respect of Group 'A' and Group 'B' officers of these Offices will vest in him. He will have a coordinating and innovating role in the introduction of Management Accounting system in the various Ministries Departments, and to facilitate this, he has been made the Convenor of the Committee under the Chairmanship of the Finance Minister constituted recently to make recommendations regarding Management Accounting.

1.2.2 In the discharge of these functions, he will also have special responsibility for:-

(i) Coordination with the Ministries in the administration and interpretation of Rules regarding Group 'C' and Group 'D' staff of the Central Civil Accounts Service;

(ii) Holding of Departmental examinations (analogous to S.A.S. examinations etc., held by the Comptroller and Auditor General of India) to maintain the requisite standard of technical expertise for accounting work in the Ministries and Departments;

(iii) Revising Treasury Rules, Account Codes and provisions of General Financial Rules in so far as they relate to the form and system of accounts etc., consequent upon Departmentalisation of Accounts and the use of the services of the Public Sector Banks in place of treasuries for collecting receipts and making payments.

1.2.3 Consolidation of monthly Civil Accounts of the Union Government from the monthly accounts submitted to him by various Ministries and Departments has also been entrusted to him with effect from 1st April, 1977. Further, the responsibility for preparation of annual accounts including summary civil Appropriation Accounts showing under the respective heads, the annual receipts and disbursements for the purpose of the Union Government has been entrusted to him after relieving Comptroller and Auditor General of India of the responsibility in consultation with him under Section 11 of C&AG's (D.P.C.) Act, 1971 vide Ministry of Finance order No. 1(12)-B(AC)/78 dated the 20th June, 1978.

1.2.4 The C.G.A./Jt. C.G.A.(s)/Dy. C.G.A.(s) have also been authorised to authenticate all orders and other instruments concerning the C.G.A.'s organisation vide Ministry of Home Affairs notification No. F. 23/5/78-Public dated the 22nd September, 1978.

   

1.3 MAIN FEATURES EMBODIED IN THE SCHEME OF DEPARTMENTALISATION OF ACCOUNTS

1.3.1 The Secretary of the Ministry/Department concerned shall be the Chief Accounting Authority for the Ministry/Department and he will discharge his functions through and with the assistance of the Financial Adviser of the Ministry/Department.

1.4.1 The Financial Adviser, for and on behalf of the Chief Accounting Authority shall be responsible for:

(a) arranging all payments through the Pay and Accounts Offices/ Principal Accounts Offices except where the drawing and disbursing officers are authorised specifically to make certain types of payments (vide Chapter 3).

Note : Any addition proposed to the list of cheque drawing D.D.Os. included in the Scheme of departmentalisation of Accounts of a Ministry/Department would require the specific approval of the Controller General of Accounts, Ministry of Finance.

(b) Compilation and consolidation of accounts of the department in the form prescribed and its submission to the Controller General of Accounts; preparation of Annual Appropriation Accounts for the Demands for Grants of his Ministry/Department, get it duly audited and submit to the CGA, duly signed by the Chief Accounting Authority.

(c) arranging internal inspection of payment and accounts records maintained by the various subordinate formations and Pay and Accounts Offices of the Department.

[Refer Correction Slip 109]

1.5.1 A Principal Accounts Office will function under a Principal Accounts Officer of the Ministry (Department concerned which shall be responsible for:—

(a) consolidation of accounts of the Ministry/Department in the manner prescribed by CGA;

(b) preparation of annual Appropriation Accounts of the Demands for Grants controlled by that Ministry/Department, submission of statement of Central Transactions and material for the Finance Account of Union Government (Civil) to the Controller General of Accounts;

(c) payment of loans and grants to State Governments through Reserve Bank of India, and wherever this office has a drawing account, payment thereof to Union Territory Governments/Administrations;

(d) preparation of manuals keeping in view the objective of management accounting system if any, and for rendition of technical advice to Pay and Accounts Offices, maintaining necessary liaison with CGA's Office and to effect overall coordination and control in accounting matters.

1.6.1     Pay and Accounts Offices will make payments pertaining to respective Ministries/Departments and in certain cases payments will be made by the departmental Drawing and Disbursing Officers (D.D.Os) authorised to draw funds, by means of cheques drawn on the offices/branches of Reserve Bank of India, State Bank of India and its subsidiaries or of the Public Sector Bank that may be accredited for handling the receipts and payments of the Ministry/Department. These payments will be accounted for in separate scrolls to be rendered to the Pay and Accounts Offices of the Ministry/Department concerned.

1.6.2     Each Pay and Accounts Office or Drawing and Disbursing Officer authorised to make payments by cheques, will draw only on the particular branch/branches of the Reserve Bank of India/State Bank of India or its subsidiary or the Public Sector Bank with which the Pay and Accounts Office or the Drawing and Disbursing Officer as the case may be, is placed in account. Out station payments, if any, shall be made in accordance with the provisions of para 1.12 et seq.

1.6.3     All receipts of the Ministry/Department shall also be finally accounted, for in the books of the Pay and Accounts Office.

1.6.4. The specific approval of the C.G.A., Ministry of Finance would have to be obtained in connection with any proposal for creation (or reorganisation) of a new Pay and Accounts Office or for adding to the list of cheque drawing DDOs included in the Scheme of departmentalisation of accounts of a Ministry/ Department. As regards opening of bank account, the Head of the Accounts Organisation of the Ministry/Department may directly approach the RBI, Central Office, Department of Government and Bank Account, Bombay (and not the accredited public sector bank).

(i) for opening bank account in favour of the PAO being newly constituted or of the DDO on whom cheque drawing powers are decided to be given, as long as the account is to be opened in the accredited bank nominated for the Ministry/Department ; and

(ii) for opening account from a specified date, in a different branch of the accredited bank because of certain administrative reasons like proximity of the branch etc. and simultaneously closing the account in the earlier branch. In such cases, it should be ensured that the reference to the Reserve Bank of India, Bombay contains full particulars of the Pay and Accounts Officer under whose jurisdiction the cheque drawing DDO will function or other relevant details such as earlier account number and location/address of branch bank etc.

However, wherever (a) a branch of another bank is proposed to be utilised at the same station where a branch of the accredited bank is already handling the transactions of the Ministry i.e. two banks are proposed to handle the transactions at the same station; and (b) the accredited bank is required to be changed, the proposal should be invariably referred to the Controller General of Accounts, Ministry of Finance who would process them further after necessary examination.

[Refer Correction Slip 118]

1.7 DETAILED PROCEDURE IN REGARD TO BANKING ARRANGEMENTS FOR PAY AND ACCOUNTS OFFICES.

1.7.1     Under the departmentalised accounting system, the receipts and payments of each Ministry/Department of Government of India are handled by the Reserve Bank of India or the Public Sector Banks (including State Bank of India and its subsidiaries) nominated for the particular Ministry/Department by the Reserve Bank of India, in accordance with the Memorandum of instructions reproduced in Annexure 'B'.

1.7.2 The Accounts Officer incharge of the Pay and Accounts Office will send to the branch of the bank with which he is placed in account, the specimen signature of the Accounts Officer/Officers who will sign the cheques, duly attested by another officer whose specimen signature is already available with the bank or by an officer of the Reserve Bank of India/State Bank of India or subsidiary bank. When there is a change in the incumbency of the officer authorised to sign the cheques, the specimen signature of the incoming officer should be attested by the relieved officer.

1.7.3 The Financial Adviser will obtain supply of cheque books required for use by the Pay and Accounts Offices from the Central Stamp Store, Nasik Road and make arrangements for their distribution to the Pay and Accounts Offices. The detailed procedure in this regard is prescribed in Government of India, Ministry of Finance (Department of Expenditure) OM No. F. 2(27)/76-SpI. Cell dated the 14th May, 1976, amended by d.o. letter No. F.2(12)/76-SC/1490-1503 dated the 16th August, 1976 (Annexure 'C').

1.7.4 The officer authorised to sign cheques will intimate to the paying branch of the bank the number of cheque book and the number of the cheque forms included therein whenever a new cheque book is brought into use. The bank will keep a record of these particulars for verifying the genuineness of the cheques presented.

1.7.5 If a P.A.O. goes on leave, a substitute is to be provided. If however, it is not administratively convenient to post a substitute for short spells of leave but there is another P.A.O. available, in that office, that P.A.O. can be authorised to sign the cheques. If there is no other P.A.O. on the strength of that office, the P.A.O. going on leave has to ensure that payments of important nature are not pending. Being a man stationed locally, cheques of urgent nature can be signed by him even at his residence. If, however, he goes out of station and no substitute is arranged in his place and there is need for making arrangements for drawal of cheques even during the short absence of the P.A.O., the Principal Accounts Officer may, for the specified period of the absence of the P.A.O., authorise the senior most Junior Accounts Officer to sign cheques. The bills passed and cheques issued during the period of absence of P.A.O. should be reviewed by the regular incumbent after his return or by the full time substitute posted in his place. For this purpose, a certificate should be sent by the P.A.O. to the Principal Accounts Officer that the bills passed/cheques issued during the period of his leave/leave of his predecessor, have been checked.

1.7.6 The name of the Ministry/Department of the Government of India, the name of the station, the name of the office/branch of the bank, and the designation of the officer signing the cheque shall be affixed by means of rubber stamps on the cheque foils.

 

1.8 CATEGORIES OF CHEQUES AND THEIR USE

1.8.1 (i) Negotiable—For personal payments such as payments to gazetted officers on account of personal claims, to contractors and suppliers and to public sector companies, corporations etc. These will be drawn as payab!e to or order of the 'Payee'. As a safeguard against fraudulent payment all non-salary cheques in excess of Rs. 250 and salary cheques in excess of Rs.1000 shall be crossed and marked 'Account Payee'.

If in exceptional circumstances, a cheque in favour of a private person or a Government servant is not crossed in this form at the request of the payee, payment will be made only to the payee on identification, or to a person holding letter of authority from the payee, whose signature must be verified and after identifying the messenger, or to the payee's banker on certifying that the amount has been placed to his credit. It should, however, be ensured that no payee makes it a practice to get uncrossed cheques in his favour as a matter of course.

[Refer Correction Slip 52]

1.8.2 It shall be permissible to pay the salaries and allowances etc. of the non-gazetted Government servants by cheques, if the non-gazetted Government servants agree in writing to their salaries and allowances being paid by cheques

(Authority: S.11019/1/77/MF-CGA/572 dated 30.6.77')

1.8.3 All officers and staff drawing salary by cheques and who desire to receive their salary in cash may be permitted to do so and payments made to them in cash in the manner as is being done in the case of non-gazetted establishment.

The option in this regard will, however be exercisable in March every year for the ensuing financial year(s). Payments other than of salary will also be made by the same mode of payment as of salary. However, in cases where salary is paid in cash, other payments like House Building Advance etc. may be made by cheques if these are large and are specifically required in writing to be made by cheques.

1.8.4 In cases where the working of any bank accredited to a Ministry or Department is affected by go-slow etc. and timely payment of salary and other payments is likely to be delayed, the officers and staff getting salary by cheques may be issued 'open' instead of 'Account Payee' cheques even when the amount to be paid in a case exceeds Rs. 1,000/-. For this purpose, the existing provisions contained in this sub-para, may be relaxed by the Chief Controller/Controller of Accounts with the approval of the Financial Adviser in respect of payments to be made at the headquarters of the Ministry/Department. At other places, similar action may be taken by the concerned Pay and Accounts Officer with the approval of his Head of Department, subject to the condition that whenever such relaxation is granted, a report to that effect is immediately furnished to the Chief Controller/Controller of Accounts.

1.8.5 'Open' cheques will invariably be made over to the individual payees through the concerned Drawing and Disbursing Officers who would be responsible for obtaining their acknowledgement in the register prescribed in para 5 of Ministry of Finance, Department of Economic Affairs, OM No. F.10(9)-B(TR)/ 76 dated the 28th February, 1976.

(Authority : C.G.A.'s O.M. No. V-16011/48-79/CTR/803 dated 11-1-1980).

1.8.6 Acquittance for payments made to Government employees should be obtained in accordance with the provisions of Rule 92 of Central Govt. Accounts( Reciepts and Payments) Rules, 1983.

[Refer Correction Slip 95]

1.9.1 (ii) Non-Transferable:—These cheques are meant for payment to the payee who is a Government officer for disbursement of salaries etc. of office establishment and for office contingencies. These cheques will be drawn in favour of the Payee by his official designation and will contain the superscription 'Not Transferable' on the top and will be drawn as payable to the payee only and not 'to order'. These cheques are not negotiable and payments will be made only to the Payee or to his messenger holding a letter of authority on proper identification.

1.10.1 (iii) Not negotiable and not payable in cash—Creditable to Government account only.—These cheques will contain the superscription 'Government Account'. These are meant for payment of inter-departmental or inter-governmental claims.

1.11.1. In the case of cheques drawn in favour of Government officials [cheques falling under category (ii) mentioned in paragraph 1.9.1], the specimen signatures of these officers will be supplied to the bank in advance and care will be taken by the bank to see that the signature given as discharge on the cheque agrees with the specimen signature on record.

1.11.2. All payments on account of settlement of inter-governmental and inter-departmental transactions (i.e. other than payment of loans and grants-in-aid to State Governments and to Union Territory Governments/Administrations and supply debits referred to in para 8.10 of Chapter 8) irrespective of location of the payer vis-a-vis payee offices, will be arranged only by issue of cheques of category (iii) mentioned in para 1.10.1 above and not by demand drafts.

NOTE:—Reserve Bank of India, Central Office, Bombay in their letter No. 2669/GA 64(12)/79-80 dated the 12th May, 1980 addressed to all the Public Sector Banks transacting Government business, have requested them to encash outstation cheques of category (iii) viz. 'Government Account' at par.

1.12 BANK DRAFTS

1.12.1 Payment by bank drafts to outstation payees by Pay and Accounts Offices is permissible in the following types of cases:-

(a) all cases where payments have to be made by bank drafts either under the provisions of any law, or other legal or contractual obligations;

(b) payment towards pay and allowances and other personal entitlements of outstation establishments, and contingencies etc. relating to outstation offices (bank drafts required in favour of drawing and disbursing officers of out-station offices to enable them to make disbursements of pay and allowances and other personal entitlements of staff, office contingencies etc. in cash will be drawn in favour of the D.D.O. by designation and bear the superscription 'not transferable', and the word 'ONLY' should be added after the designation of the 'Payee').

(c) Public sector undertakings and corporations (Other than local bodies) set up by Government should open bank accounts at the station where the Pay and Accounts Office concerned is located, in order to facilitate payment to them by crossed, negotiable cheques only. Wherever this is not possible, payments may be arranged by crossed demand draft(s).

(d) Payments to semi-Government/private institutions/private companies/individuals, etc. not covered under (a) to (c) above and located at outstations by crossed bank draft.

(Authority: C.G.A.'s No. S. 11019/1/80/TA/3896 dated the 23rd October 1980).

[Refer Correction Slip127]

1.12.2 Bank drafts for the regular monthly pay and allowances of establishment will be superscribed 'Not to be presented before..........' (the earliest date on which the payment can be made under Rule 64 of Central Govt. Account (Receipts & Payments) Rules, 1983.

[Refer Correction Slip 95]

1.12.3 For obtaining the bank drafts required for outstation payments, the Accounts Officer of the Pay and Accounts Office will present a requisition in Form SY 288 duly supported by a statement in duplicate showing the particulars of the bank drafts required along with a Cheque of category I (Negotiable) for the total amount drawn in favour of the bank (name of the bank to be indicated as payee). If any special superscription is required to be made in the draft such as 'Account payee', 'Account Government only', 'Not Transferable' or 'Not to be presented before ......', a specific request to this effect should be sent with the requisition. When drafts are required in favour of drawing and disbursing officers of outstation offices to enable them to make disbursement in cash of pay and allowances of staff, office contingencies etc., the draft should bear the superscription 'Not transferable' and the word 'ONLY' should be added after the designation of the payee. A register of requisition of bank drafts shall be maintained vide para 2.3.4.

 [Refer Correction Slip 57]

1.13 PAYMENT BY MAIL TRANSFER

1.13.1 It has been decided in consultation with Reserve Bank of India that Public Sector Banks will also extend to the Departmentalised Central Government Ministries/Departments the facility of remittance of funds to Semi-Government/Grantee Institutions through Mail Transfers free of charge under their own remittance facilities scheme. This will be in addition to the existing facility of payment through Demand Drafts.

1.13.2 In order to enable the Pay and Accounts Office to arrange remittance by Mail Transfer, the Drawing and Disbursing Officer will submit the bill with an endorsement that the payment may be arranged by Mail Transfer. He will also indicate the account number and name of the Branch Bank through which the payment is to be remitted. The Pay and Accounts Office will intimate the particulars of cheque number and date so that the Drawing and Disbursing Officer could complete his records and watch the acknowledgement from the grantee institution.

1.13.3 This facility will be available only for Autonomous Bodies/Public Sector Undertakings and Grantee Institutions for payment of grant-in-aid and will not be applicable for suppliers and other private parties.

[Refer Correction Slip 185]

1.14 PAYMENT BY AUTHORITY

1.14.1 Whenever payments are to be authorised on the paying authorities abroad, the P.A.O. concerned will issue the authority which will be countersigned and embossed with special seal by the Principal Accounts Office and forwarded to the authority who will make the payment. Necessary authority letters authorising the officer in the Principal Accounts Office to sign such letters and his specimen signatures and special seal should be sent to all concerned. If in any Ministry, such payments have to be frequently authorised by a particular P.A.O. the said P.A.O. may be authorised as a standing arrangement to directly issue the authority duly embossed with special seal.

1.15.1 The procedure prescribed in Rule 48  of Central Govt. Account (Receipts & Payments) Rules, 1983 and inserted as para 2.4. of Chapter 2 of this Manual, shall be followed for the issue of a fresh cheque in lieu of a cheque issued earlier but reported to have been lost.

 [Refer Correction Slip 95]

1.16 PAYMENT SCROLLS

1.16.1 The payment scrolls will be prepared by the paying branch of the bank in quadruplicate, in the form set out in Annexure 'B'. As and when cheques are passed for payment the cheques will be entered in the scroll. The serial number of each entry in the scroll will be recorded on the corresponding cheque for purpose of identification. The scroll will be totalled at the end of the day. For detailed procedure to be followed by the banks, Annexure 'B' to this Chapter may be referred to.

1.16.2 At the beginning of the next working day, the paying branch will forward two copies of the scroll (duly signed by the authorised official of the bank) alongwith paid cheques to the Pay and Accounts Office. The Pay and Accounts Office will conduct the following checks :-

(i) Whether the cheque is one that was issued by that Pay and Accounts Office.

(ii) Whether the payment recorded in the scroll tallies with the amount shown on the paid cheque.

(iii) Whether the payment shown in the scroll and on the cheque tallies with the amount passed for payment on the related voucher and with the entry in the Register of Cheques Delivered (From CAM-11). The entry in the latter register will be simultaneously ticked off and the date of encashment also noted therein.

Note: The checks at (i) and (ii) above are to be exercised scrupulously under P.A.O.'s personal supervision.

[Refer Correction Slip 143]

1.16.3 One copy of the scroll will be returned to the bank with a certificate of correctness of the scroll. Any discrepancy noticed should be promptly taken up with the branch for carrying out the correction by means of an "Error Scroll". The paying branch will also render scrolls of receipts to the Pay and Accounts Offices along with challans. The entries in receipt scrolls will be reconciled in the accounts office in the manner laid down in para 1.17.2 et seq.

[Refer Correction Slip 197]

1.16.4. The Pay and Accounts Office in account with a public sector bank, i.e. other than Reserve Bank of India shall post the total of each day's payments and receipts as per the payment/receipt scrolls (excluding discrepant items, if any) in the Register of Public Sector Bank Suspense (Form-C.A.M. 17). Separate folio may be opened for entering scrolls pertaining to P.A.O. and each cheque drawing D.D.O.

1.16.5. The Pay and Accounts Officer will tally the monthly gross payments/ receipts worked out in this register with the gross amount derived from the monthly statements of disbursements and receipts received from all concerned bank(s) and record a certificate in this regard in the register. Thereafter he shall take the figures of payments and receipts for each month to the account head "858—Suspense Accounts—Public Sector Bank Suspense" on the appropriate side i.e. credit and debit sides respectively in the Classified Abstract. Thereafter he shall take the figures of payments and receipts for each month to the account head "858—Suspense Accounts—Public Sector Bank Suspense" on the appropriate side i.e. credit and debit sides respectively in the Classified Abstract. 

[Refer Correction Slip 15]

 1.16.6: The idea behind opening the minor head' Public Sector Bank Suspense' with effect from 1st April, 1977 is to exhibit in accounts the difference between amounts of Central Government (Civil) transactions occuring in Public Sector Banks which are included in Government Accounts and the amounts actually adjusted by the Reserve Bank of India, Central Accounts Section, Nagpur against the Central Government on the basis of advices received from the link branches of Public Sector Banks through designated offices of Reserve Bank of India. The progressive balances outstanding on credit and debit sides under the minor head 'Public Sector Bank Suspense' in the books of the Principal Accounts Officer concerned will represent respectively the payments and receipts of the Ministry/Department handled by its accredited Public Sector bank for which either settlement remains to be effected between the public sector bank and the Reserve Bank of India or non clearances therefrom by the Principal Accounts Offices due to non-receipt of monthly statement(s) of transactions from the R.B.I., Central Accounts Section, Nagpur before close of the monthly accounts of relevant month. Causes for the said non-settlement will generally be (i) delay in receipt of memorandum of transaction(s) by link banks from branch banks, (ii) delay or omission on the part of link banks in including the amounts of branch bank's memorandum in their daily advice to Reserve Bank of India, (iii) difference between amounts indicated in branch bank memo (which gets reflected in link bank advice) and the correct amounts of cheques paid /receipt chalans scrolled and (iv) erroneous classification of transactions of a Ministry/ Department against another Ministry/Department in its advice(s) by a branch or link bank of a public sector bank which handles transactions of more than one Ministry/Department.

Similarly, in the monthly Civil Accounts of the Government of India consolidated by the Controller General of Accounts, progressive figures of credit and debit balances outstanding under the head 'Public Sector Bank Suspense' will give a total picture thereof relating to all Civil Ministries/Departments put together.

(Correction slips 15, 16, 17 and 20 are a sequel to O.M. No. S. 11012/1/81/ RBD/3959 datted 29-9-1981).

[Refer Correction Slip 16]

1.16.7. Clearance from the suspense head as above by transfer to the head "875-Deposits with Reserve Bank-Central Civil-Reserve Bank Headquarters" shall be made by the Principal Accounts Office on receipt of intimation of the monthly figures from C.A.S. of Reserve Bank of India, Nagpur as indicated in detail in para 1.20.2 et seq.

[Refer Correction Slip 197]

1.16.8. The Pay and Accounts Officer in account with a branch of the Reserve Bank of India as primary banker shall post the total of the day's payments and receipts as per the scrolls, in the Register of Reserve Bank Deposits (Form CAM-17). The monthly totals of receipt and payment scrools as worked out in this register will be taken to the classified Abstract as debit and credit respectively under the head of account '8675—Deposits with Reserve Bank—Central Civil—Reserve Bank Headquarters

[Refer Correction Slip 196]

 1.17 RECEIPT SCROLLS

1.17.1. Receipts of Ministries/Departments will normally be received in the form of cheques on local banks or demand drafts, drawn in favour of the Pay and Accounts Officer or cheque drawing D.D.O. as the case may be. Receipts in cash will, however, be accepted by cheque drawing D.D.Os. or other departmental officers subject to the provisions of Rule 18 of Central Govt. Account (Receipts & Payments) Rules, 1983.

[Refer Correction Slip 95]

1.17.2 The receipts thus accepted will be remitted into Government account which is held by a P.A.O. or by a cheque drawing officer in the relevant branch of the bank accredited to the Ministry/Department concerned. Challan forms shall be used showing particulars of cash/cheque/demand draft deposited and the classification relevant thereto in triplicate where the Pay and Accounts Offices remit and in quadruplicate where the cheque drawing D.D.O. remits. Receiving branch bank will render receipt scroll (i) daily to the Pay and Accounts Office in respect of receipts entering the accounts held by him together with challans and (ii) weekly, along with the receipted challans in support thereof, to the concerned Pay and Accounts Officer in respect of receipts entering the accounts of cheque drawing D.D.Os, and copies of scrolls to the latter. Based on the challans received by him the departmental officer will prepare a weekly statement of receipts giving the number and date of the challan, name of the depositor and amount deposited. He will also check the entries in the copy of the scrolls received by him with entries in the statement of receipts and reconcile with the bank any discrepancy detected, under advice to the Pay & Accounts Office. He will also send to his P.A.O. a monthly bank reconciliation statement (Form CAM-22).

1.17.3. The Pay & Accounts Office will, on receipt of bank scrolls, check the entries in the scrolls with the challans attached thereto, and after proper linking, shall pass them on to the compilation section for posting the total receipts as per scrolls in the register of public sector bank suspense or Reserve Bank Deposits as the case may be, maintained in form C.A.M.-17 and also for compiling the challans to the receipt heads concerned. He will also watch receipt of reconciliation statement from the cheque drawing DDOs to ensure that all the amounts credited by them have been correctly entered in the scrolls received by him. He will also watch whether credit is given in bank scrolls for all the cheques/bank drafts sent to the bank by him for credit into Government account, and take appropriate action in respect of those outstanding, in consultation with the bank. If any of outstanding bank drafts happens to be one that was received from a Departmental Officer (without cheque drawing powers) stationed at an outstation, he would have to keep the latter informed and/or arrange for further action being taken with the party concerned through the latter.

[Refer Correction Slip 2]

1.17.4. Departmental officers who are other than the cheque drawing, DDOs situated at the same station as the Pay and Accounts Officer shall remit the collections received in cash or local cheque/demand draft into the bank in which the Pay and Accounts Office holds an account duly supported by challans. He will also send to the Pay and Accounts Office a weekly list of remittances into the Bank to enable the Pay and Accounts Officer to watch receipt of corresponding credits in the bank scrolls received by him.The Pay and Accounts Office shall intimate to the Departmental Officer for further action, details of cheque(s)/bank draft(s) remaining outstanding or dishonoured at the end of the month subsequent to that in which the latter had reported it (them) as remitted to the Bank. Departmental Officers situated at a station other than that of the Pay & Accounts Office, shall obtain receipts in the shape of demand drafts drawn in favour of the Pay & Accounts Office and payable at the latter's station and where he is empowered to receive cash, shall convert the same into a demand draft drawn in favour of his P.A.O. and remit the same to the latter for crediting into Government account. If under the provisions of any Rule/Act, the receipts of a department are at present required to be remitted by the public by means of demand draft drawn in' favour of departmental officers and such an officer happens to be a non-cheque drawing officer, he should endorse it in favour of the Pay and Accounts Officer of his Department for crediting it into the Government account held by the latter. Reserve Bank of India have clarified that there is no legal bar to a crossed cheque/demand draft drawn in favour of departmental officer and bearing the endorsement 'Account Payee' being endorsed by him in favour of his Pay and Accounts Officer for this purpose.

(Authority: Reserve Bank of India's letter No. GA. 1652/22-78/80 dated 11th January, 1980 in the File No. S. 13018/1/79/TA).

[Refer Correction slip 3]

Even category III cheques/drafts bearing the endorsement "Not negotiable and not payable in cash—creditable to Government account only" drawn in favour of Chief Controller/Controller / Dy. Controller of Accounts i.e. Principal Accounts Officer, could be endorsed by him in favour of a P.A.O. under him for crediting to Government account.

[Refer Correction Slip 34]

Note:—Receipts relating to Direct Taxes (Income tax, Corporation tax) and Indirect Taxes (customs and excise duties etc.) administered by Central Board of Direct Taxes/Central Board of Excise and Customs will, however, be credited/remitted into the Reserve Bank of India and other nominated branches of public sector banks using challan forms specifically prescribed under the relevant provisions of the schemes of revenue collections of Central Board of Direct Taxes/Central Board of Excise and Customs with effect from 1st April, 1977.

 

1.18.1 REGISTER OF VALUABLES

Bank drafts or cheques received in the Pay and Accounts Office should be entered in the Register of Valuables (Form CAM-16) immediately on receipt and then sent to the Bank for credit to Government account with a credit slip.In order to reduce clerical work in this respect in cases of heavy receipt of valuables from outstation non-cheque drawing D.D.Os, the covering list of valuables received from them may be pasted in the register after checking each entry in the list with the valuables enclosed therewith. The register should be closed every fortnight and bank drafts/cheques for which the corresponding credits in the bank scrolls are not forthcoming should be investigated.

[ Refer Correction slip 4]

1.19 ADVICES ON RESERVE BANK OF INDIA (CAS) NAGPUR AND OPERATION & CLEARANCE OF THE MINOR HEAD, RESERVE BANK SUSPENSE (C.A.O.) ETC:

1.19.1 Payments of loans and grants to State Governments and repayments of loans/payment of interest by State Governments are effected by the issue of advices to the Central Accounts Section of R.B.I., Nagpur by various Principal Accounts Offices etc. in terms of the procedure prescribed in Chapters. Advices issued by a Pr. A.O. to R.B.I. (CAS), Nagpur in this connection for effecting monetary settlement through its books will be given the same treatment in accounts as is given to cheques issued, except that the head '858-Supense Accounts-R.B. Suspense (C.A.O.)' instead of the head '870-Cheques and Bills' will be operated upon for affording contra credit. This suspense head will also be cleared with a minus credit as soon as relevant intimation (clearance memo) is received from R.B.I. - - C.A.S. Nagpur about having effected the settlement in the manner indicated in para 1.19.3 et seq.

[Refer Correction Slip 197]

1.19.2 Intimations received by a Principal Accounts Office from the RBI (CAS), Nagpur about credit having been afforded to the Ministry's/Department 's account based on advices from Accountants General etc. will be dealt with in the same manner as receipt scrolls from banks (without supporting details which would be awaited from the Accountant General concerned) and the head "Reserve Bank suspense (C.A.O.)" (credit side) will be operated upon. On receipt of details from the A.G., the suspense head should be cleared through a transfer entry, affording minus credit to it with per contra credit to the final head (s). This procedure of operating on Reserve Bank Suspense (C.A.O.) may be adopted in respect of all such Clearance memos received irrespective of whether particulars are received and complied, or not.

1.19.3 Form of register of Reserve Bank Deposits-Part II (CAM 17A) has been devised for use in the manner indicated in the other sub paras of this para and in the next para. However, Principal Accounts Offices which are not concerned with the operation of remittances heads need not open columns meant for indicating contra effect against major heads 886 to 889 (viz. columns 7 to 10).

All advices for payments of the type referred to in para 1.19.1. above should be entered in a register in form CAM 65 and they should be submitted for signatures along with the register. Monthly total under column 3 of the register should be entered as credit against the head '858-Suspense accounts-Reserve Bank Suspense (Central Accounts Office)' in the classified/consolidated abstract. Also, full classification of the final head(s) to which the payment is debitable should be indicated/pasted on a spare copy of each advice, and passed on to the Compilation Section along with the daily memorandum of advices issued, for posting in the compilation sheet etc. As soon as clearance memos are received from the RBI, their particulars should be entered in form CAM17A. Total amount under column 12 thereof will have to be reckoned for posting against the said suspense head in the classified abstract as responding minus credit.

Clearance memos received in the type of cases referred to in para 1.19.2 are to be entered in form CAM 17A and credit afforded to the said suspense head to the extent of the monthly total under column 6 of the register and T.Es proposed in all cases on receipt of particulars from AGs in the manner indicated in para 1.19.2.

The  total receipts and disbursements under columns 5 and 11 of the said register will be reckoned for the purpose of entry on the appropriate side of the classified abstract/consolidated abstract against the head of account "875-Deposits with Reserve Bank-Central Civil-Reserve Bank Central Accounts Office". Ordinarily, no balance should remain outstanding under the head 'Reserve Bank Suspense' at t he close of the accounts of a financial year.

[Refer Correction Slip 196], [Refer  Correction Slip 197]

1.19.4 In the case of operation of remittances heads by Supply Accounts and External Affairs Accounts Offices etc. referred to in paras 8.10.1 and 8.11.1 et seq, the original adjustment of debit against these heads would have arisen at the time of compilation of the relevant payment vouchers in a manner similar to adjustment under 'PAO Suspense' dealt with in para 8.2.1 with the difference that the settlement will be by issuing advices on RBI, CAS, Nagpur instead of by asking for a cheque. The responding stage commences with the issue of an advice to RBI (CAS) Nagpur. The advices may be entered in a separate register in form CAM 65. When the relevant clearance memo is received from RBI, "Nagpur, it should be entered in C.A.M.17A so as to give responding minus debit to the relevant remittance head from the monthly total thereunder and the corresponding debit would form part of the figure to be reckoned against the head '875-Deposits with Reserve Bank—Central Civil—Reserve Bank Central Accounts Office'.

Ordinarily, no balance should remain outstanding under these remittances heads at the close of the accounts of a financial year.

1.19.5. Monthly totals under columns No. 5 & 11 should be tallied and reconciled with the monthly report of adjustments submitted by R.B.I. (CAS) Nagpur vide portion (i) of para 1.20.1 et seq.

[Refer Correction Slip 22], [Refer Correction Slip 197]

1.20.1. On receipt of the daily intimations of  receipt and payment relating to each Ministry/Department from the Head Office/Designated Link Office of the public sector bank, the nominated office of the Reserve Bank of India will effect necessary settlement and intimate the closing balance etc. at the close of business everyday to the Central Accounts Section of Reserve Bank of India, Nagpur to enable the latter, inter alia, to work out the daily balances of the Govt. of India. The Central Accounts Section, Reserve Bank of India, Nagpur shall maintain a separate proforma account styled "Departmentalised Ministries' Account" (with details in respect of each Ministry/Department) in the General Ledger. The Central Accounts Section, R.B.I., Nagpur shall furnish Ministry-wise/Department-wise balance for each month to the concerned Controller of Accounts of the Ministry/Department indicating (i) adjustment effected by the Central Accounts Section, Reserve Bank of India, Nagpur on the basis of advices received from the Pr. Accounts Office in terms of para 1.19.1 and from A.Gs in terms of para 1.19.2 read with paras 8.10.3 & 8.20.2, & from Railways in terms of para 8.15.1 etc.and (ii) balances (total receipt/payment) transferred from Reserve Bank of India offices representing transactions during the month in respect of that Ministry/Department as reported by (a) branch of Reserve Bank of India acting as primary banker and (b) by the nominated office of the Reserve Bank of India effecting the settlement with the Head Office (Designated Link Office of Public Sector Bank) and the net balance of that Ministry/Department calculated therefrom, vide Reserve Bank of India circular No. 2036/GA-64 (12)-77/78 dated the 21st March, 1978.

[Refer Correction Slip 24], [Refer Correction Slip 196], [Refer Correction Slip 197]

1.20.2. The Principal Accounts Officer will be responsible for clearance from the Public Sector Bank. Suspense head with reference to the figures reported by Central Accounts Section, Reserve Bank of India, Nagpur under (ii) (b) above. The clearance will be effected by means of a transfer entry by affording against the suspense head 'Minus debit' to the extent of the total receipts shown in the report, and minus credit' to the extent of the total disbursements shown, with contra entry against the head 8675—Deposits with Reserve Bank—Central Civil—Reserve Bank (PSB) on the appropriate side.

[Refer Correction Slip 17], [Refer Correction Slip 196]

1.20.3. The Principal Accounts Officer will also be responsible for effecting the necessary agreement of these figures in the Ministry/Department wise balances with the figures under the Reserve Bank Deposits/Public Sector Bank Suspense heads appearing in the monthly account rendered by them to the Office of the Controller General of Accounts. The differences detected during the said agreement of the figures under "Deposits with Reserve Bank-Central Civil"— (All its sub heads) and amounts outstanding under "Public Sector Bank Suspense" should be got analysed and settled before the accounts of the year to which they pertain are closed. In exceptional cases where this has not been achieved, the matter should be pursued to finality even thereafter and adjustments that may be required, should be included in the accounts which are open.

NOTE :- The final adjustment for transferring the amount from the head ' 875-Deposits with Reserve Bank ' to '899-Cash Balance' will be done by the C.G.A.

[Refer Correction Slip134], [Refer Correction Slip 191]

1.20.4. The responsibility for effecting reconciliation between the net increase/ decrease in the balance of the Central Government as a whole with the Reserve Bank as reported by the Reserve Bank and the net results of the credits/debits to the head 'RB Deposits' reported in the accounts rendered by the various Principal Accounts Officers will be that of the Offices of the C.G.A. In effecting such reconciliation, the effect of the transactions taking place at the Banking treasuries as well as the Centre-State adjustments advised by Accountants General etc. will also be taken into account.

1.21.1 One of the important duties of each Pay and Accounts Office, as a prelude to the introduction of Exchequer Control (which will require a law to be enacted under Article 149 of the Constitution) is to see that no payment is made in excess of budget allotment, unless it is covered by an advance from the Contingency Fund.

1.21.2. Since under the new system, all payments are closely related to appropriation at the very points authorising such payments, chance for error in classification requiring rectification through transfer entries in accounts are considerably reduced, if not totally eliminated.

1.21.3. Copies of all sanctions and orders to be acted upon by the Pay and Accounts Office will either be addressed to him or endorsed to him by the authority competent to accord sanction, indicating, inter alia, the head of account under which the payment is to be classified and also quoting reference to the U.O. No. under which sanction of the Ministry of Finance/ Financial Adviser was taken wherever necessary.

1.22.1 The following principles should be adopted for classifying the expenditure on departmental accounts organisation:

(a) The expenditure on a Pay and Accounts Office, which is exclusively dealing with a separate identifiable organisation will be treated as regular expenditure of the organisation without operating separate minor heads for this purpose. For example, expenditure on PAO (DGTD), will be debited to '320-Industries—A General-Direction and Administration; that relating to PAO (SALT) will be debited to '320—Industries—B Large and medium industries-Consumer Industries'; that on PAO (Tourism) to the head '339—Tourism-Direction and Adminstration'.

(b) In respect of separated accounts organisations in the Departments of Food, Supply and Rehabilitation which have been functioning even before 1.4.76, the old classification may be continued for the present. (This will not apply to Pay and Accounts Offices of Works and Housing or Agriculture Ministries);

(c) Expenditure on special accounting organisations already set up before departmentalisation, for example, FA&CAO, Dandakaranya, FA Tuticorin Harbour Project, etc., will also continue to be classified as at present;

(d) The expenditure on all other Pay & Accounts Offices as well as Pr. Accounts Offices of all Ministries/Departments including Internal Audit Wings set up under the Departmentalisation scheme will be classified under the minor head 'Secretariat' below the appropriate Secretariat Major head viz., '252-Secretariat-General Services' or '276-Secretariat-Social and Community Services' or '296-Secretariat-Economic Services', as the case may be.

1.22.2. Budget provision will also be made according to the principles set forth above. In the case of (a) above, the provision will be Included in the total provision for the organisation. In the case of (b) and (c) above, the present system of budgeting will be continued to be followed. In respect of (d), budget provision will be included in the Secretariat Demands for Grants of the concerned Ministries or Departments.

 

ANNEXURE 'A' TO CHAPTER I

(Referred to in Para 1.2.1)

NOTIFICATION No. CD-896/80

Dated 27th September, 1980 

issued from Rashtrapati Bhawan, New Delhi

2. (C) Under the heading MINISTRY OF FINANCE (VITTA MANTRALAYA), under the sub-heading B—DEPARTMENT OF EXPENDITURE (VYAYA VIBHAG):-

(a) entry 5 shall be omitted;

(l) for entry 7A, the following entry shall be substituted, namely:-

"7A. Organisation of the Controller General of Accounts dealing with

(i) General principles of Government accounting relating to Union or State Governments and form of accounts, and to frame or revise rules and manuals relating thereto;

(ii) Reconciliation of cash balances of Union Government with Reserve Bank in general and, in particular, of Reserve Bank Deposits pertaining to Civil Ministries or Departments;

(iii) Overseeing the maintenance of adequate standards of accounting by Central Civil Accounts Offices;

(iv) Consolidation of monthly accounts, preparation of review of trends of revenue realisation and significant features of expenditure etc. and preparation of annual accounts (including Summary Civil Appropriation Accounts) showing under the respective heads, the annual receipts and disbursements for the purpose of the Union Government;

(v) Administration of Central Treasury Rules;

(vi) Co-ordination and assistance in the introduction of management accounting system in Civil Ministries or Departments;

(vii) Cadre Management of Group 'A' (Indian Civil Accounts Service) and Group 'B' Officers of the Central Accounts Offices; and

(viii) Organising of training and examination for the Central Civil Accounts Staff belonging to Group 'C' and 'D'.

 

ANNEXURE 'B' TO CHAPTER 1

(Referred to in Para 1.7.1)

Memorandum of instructions on banking and accounting arrangements in connection with receipts and payments on Government account by public sector banks under the scheme for the departmentalisation of the system of accounts (and the appointment of Integrated Financial Advisers for the various Ministries or Departments).

The banking and accounting arrangements in connection with the receipt of income and other direct taxes, central excise duties and sales taxes and the payment of civil pensions, under the scheme for collecting such dues or making such payments through the branches of the public sector banks in the metropolitan towns, have been or will be advised separately to the banks concerned. In addition to and without interfering with these arrangements, the Government of India have decided to introduce a scheme for the decentralisation and departmentalisation of the accounts of the individual Ministries, transferring the responsibility for the maintenance of the accounts at all stages from the Accountants General to the integrated financial advisers of the Ministries. The arrangements in connection with payments and receipts on Government account by public sector banks under the scheme for the decentralisation of the system of accounts and the appointment of integrated financial advisers for the various Government departments are indicated in this Memorandum for the guidance of the banks concerned. In section II of this memorandum, the arrangements in regard to payments on behalf of the Government departments concerned other than pensions, which will be dealt with separately have been indicated. Section III deals with the procedure in regard to receipts, other than receipts on account of income and other direct taxes, central excise and sales taxes, in regard to which separate arrangements have been or are being made. Section IV contains some general instructions for the guidance of the banks concerned.

 

II

Payments on behalf of Government departments.

2. The integrated financial adviser of the Ministry will make budget allocations to the various wings, departments or formations under his jurisdiction, on the strength of which the Accounts Officers in charge of Pay and Accounts Offices will issue letters of credit, assigning the amounts allotted to drawing and disbursing officers, quarterly or at other intervals as may be convenient, sending the necessary intimations directly to the concerned branches of public sector banks with whom the department of the Ministry is banking. Payments on behalf of a drawing and disbursing officer served by a branch during the specified period will not exceed the amount of the assignment or letter of credit.

3. The concerned branch will maintain a ledger in form as per Form I for the assignment or letter of credit account of each drawing and disbursing officer for whom the branch will be acting as banker. Full particulars such as the name of the account the date of opening the account the name and designation of the officials authorised to operate on the account a reference to the letter from which the authority is derived the amount of the assignment or letter of credit and the number of the cheque book and the numbers of the cheque leaves which will be used for operation on the account will be recorded at the top of the first page of the account under the authentication of an authorised official of the bank. The essential particulars relating to the account will be carried over to subsequent folios under the initials of the checking official.

4. The specimen signatures of officials authorised to operate on the assignment or letter of credit accounts will as far as possible, be obtained on sheets prescribed by the bank for the purpose. If specimen signatures are furnished on letters, they will be cut out and pasted on cards. The specimen signatures should invariably be attested by another Government official, preferably by one whose specimen signature is already recorded with the bank. If this is not possible, the specimen signature should be got attested by the Reserve Bank. Where a fresh specimen signature is being furnished due to a change in the incumbency of the drawing official, incoming official's specimen signature should be duly attested by the relieved official.

5. Government departments maintaining accounts with the bank will make use of their own cheque forms for drawing on the accounts. For this purpose, the integrated financial adviser will make an annual or half-yearly assessment of the total number of cheque books required for his Ministry and either place a consolidated indent or authorise a senior officer in each department of the Ministry to place an indent for his department with the Deputy Controller of Stamps Central Stamp Stores, Nasik, giving detailed instructions in regard to the distribution of the cheque books to various Pay and Accounts Offices or drawing and disbursing officers as the case may be. The drawing officer will intimate to the branch concerned the number of the cheque book and the number of the cheque forms contained therein, whenever a new cheque book is brought into use. The signature on such advices will be verified by the authorised official of the branch and the particulars of the cheque book will be noted in the relative ledger under his initials, suitable remarks being made on the advices at the same time.

6. While passing Government cheques, apart from the checks and precautions usually exercised by banks, the following points will be observed:—

(a) Different periods of currency are prescribed for different classes of cheques in the Treasury Rules and these are usually printed on the cheques themselves. It should be ensured that a cheque presented is current in accordance with the period applicable to it.

(b) In order to ensure that fraudulent and unauthorised cheques will not be presented, each drawing officer will draw cheques only on one branch of a bank specified in this behalf by the integrated financial adviser or by any other person nominated by him.

(c) As a further safeguard against fraudulent payments and with a view to protecting the interests of Government, any cheque in respect of the salary or pension of any person for an amount of Rs. 1,000 or more and any other cheque in respect of any expenditure other than the salary of an office employee or contingent expenditure for the office if it is in excess of Rs. 250 will be marked "Account Payee". Such cheques will be collected in the usual manner as in the case of other similar cheques.

(d) If a cheque is for an amount which is smaller than the amounts mentioned above and is not crossed in this form, it will be paid only to the payee on identification, or to his banker on a certificate from the banker that the amount has been placed to the payee's credit, or to a person holding a letter of authority from the payee, after the payee's signature on the letter has been certified and the messenger has been duly identified.

(e) Inter-departmental and inter-governmental adjustments will be made by means of cheques. In all such cases, the cheques will be superscribed with the words "Account Government". Where a cheque is superscribed with the words "Account Government", the amount of the cheque should not be paid in cash and the drawee bank should ensure that the proceeds are paid to the credit of the Ministry, department or office of the Government concerned, either with itself or with another bank in the public sector conducting business on behalf of that Ministry, department or office as the case may be.

(f) When amounts are required by officers of the Government to enable them to make disbursements of pay and allowances of non-gazetted staff and contingent or other expenditure in cash on behalf of Government, the cheque will be superscribed with the words "not transferable". Where a cheque is superscribed with the words "not transferable", the proceeds may be paid in cash, care being taken to ensure that payment is made either to the payee himself on identification or to his authorised agent being a person holding a letter of authority from him or to the payee's banker. It should be borne in mind that payment can be made to a person holding a letter of authority from the payee only if the latter's signature is known to the bank or he can be identified to the paying bank and also that payment can be made to the payee's banker, only on his furnishing a certificate that the amount has been placed to the payee's credit. A transfer of the cheque by endorsement in such cases should not be allowed under any circumstances.

(g) The amount assigned or the amount mentioned in the letter of credit should not be exceeded at any time by reason of the payment of any cheque.

As Government cheques are issued in favour of individuals, private firms, joint stock companies and quasi-public bodies, it is essential that the staff attending to the payments should be fully conversant with the nature of endorsements to be made on the cheques by each class of payees. Unless it is proved that payment is made in due course i.e. in good faith and without negligence, the bank cannot secure the protection afforded by Sections 85 and 85A of the Negotiable Instruments Act.

7. In the case of cheques drawn in favour of Government officials, the specimen signatures of the latter will generally be supplied to the bank in advance and care should be taken by the bank to ensure that the signature given as discharge on cheques agrees with the specimen on record. The specimen signatures of the payee officials will not be recorded along with those of the drawing officials. They will be kept in separate files, alphabetically arranged according to departments to facilitate the verification of endorsements on cheques or signatures on other documents, if any, as and when this may be required.

8. One or more counter clerks conversant with endorsements and the signatures of the Government officials concerned, depending upon the volume of work involved, will be posted to receive cheques drawn on Government account and tendered over the counter for payment in cash. The counter clerk will examine the cheque and, if he finds it prima facie in order and properly endorsed, add his initials on the left hand bottom corner of the cheque and issue a token to the tenderer after recording its number on the cheque. He will then pass on the cheque to the ledger clerk. The ledger clerk will examine the cheque with reference to the various points detailed in paragraph 6 above and if it is found to be in order, will post the cheque in the relative account in the ledger as also in the payment scroll. After being entered in the scroll, the cheque will be branded with the 'Pay Cash' stamp and the serial number of the entry in the scroll recorded on it above the stamp. The ledger and scroll with the relative cheques will be put up to the authorised passing official and the passed cheques will be sent to the cash payment counter for the payment of cash against the surrender of the tokens issued.

9. Cheques on Government account may be tendered with pay-in-slips or chalans, for credit of some other accounts maintained at the branch, in which case the transactions will be only transfer transactions. Cheques on Government account may also be received through clearing. In all these cases, the cheques will be examined with reference to the various points detailed in paragraph 6 above, posted in the ledger accounts and payment scrolls and duly passed by the passing official.

10. Payment scrolls will be prepared in triplicate or quadruplicate as the case may be in the form set out in Form 2. Copies in triplicate will be prepared, if the bank is serving the Pay and Accounts Office direct and copies in quadruplicate will be prepared if the bank is serving a drawing and disbursing officer, who renders returns and accounts in turn to a Pay and Accounts Office. The serial number of each entry in the scroll will be recorded on the corresponding cheque for purposes of identification. Each day's scroll will also be given a running serial number for the accounting year from 1st April to 31st March, separate serial numbers being given to scrolls of each account, to facilitate detection of any omission in submitting the daily scrolls. Every such scroll will be totalled after the close of business every day by the paying branch and the books of the branch will be balanced for the day with reference to the totals of the day's scroll and the other transactions of the branch.

11. If a branch is serving a Pay and Accounts Office directly, at the beginning of the next working day, the paying branch will forward the original and duplicate copies of the scroll with the paid cheques attached to the original copy of the scroll in the serial order in which they are entered in the scroll to the officer in charge of the designated Pay and Accounts Office. The triplicate copy without the paid cheques will be retained in the branch for its record. If a branch is serving a drawing and disbursing officer, it will send the original and duplicate copies to the Pay and Accounts Office and the triplicate copy to the drawing and disbursing officer, the quadruplicate copy being retained for its use and record. If the drawing and disbursing officer is being served by a branch which is not at the same centre as the Accounts Officer of the designated Pay and Accounts Office, the scrolls and paid cheques will be sent by registered post every week on Saturday, or if Saturday is a holiday on the preceding working day.

12. From the copy of the scroll and paid cheques received by the designated Pay and Accounts Office, the officer-in-charge of that office will check each payment with the statement of cheques issued, received from the drawing and disbursing officer and will certify the correctness in the copies of the scrolls and return the certified duplicate copy to the paying branch. For enabling the officer in charge of a Pay and Accounts Office to do so, every drawing and disbursing officer subordinate to a Pay and Accounts Officer will check each payment recorded in the copy of the scroll received by him with the entries in the cash book maintained by it in which all cheques issued are recorded and will reconcile any discrepancy, which may be detected by him with the bank and advise the Pay and Accounts Office suitably. If the paying branch is not at the same centre as the designated Pay and Accounts Office, the certified. duplicate copies of scrolls will be sent by the Pay and Accounts Office to the branch concerned following the procedure indicated in the concluding portion of paragraph 11 above.

 

Ill

Receipt on behalf of Government departments

13. The depositor will deposit the amount of dues payable to any department or formation of the Ministry with the branch of the public sector bank, with which the department or formation of the concerned Ministry is banking. The payment will be made in cash or by means of a cheque or draft, along with the appropriate chalans in duplicate or triplicate or quadruplicate as required.

14. Before a deposit on Government account is accepted, the accompanying chalans will be carefully scrutinised to see that they are properly filled in. The scrutiny of the chalans will be attended to by the counter clerk in the case of those accompanied by cheques or drafts and by the receiving teller in the case of those tendered with cash. The scrutiny will be conducted with special reference to the following points:-

(i) that the proper chalan form in duplicate, triplicate or quadruplicate as required has been used.

(ii) that all the columns which are required to be completed by the tenderer have been filled in and that the remitter's signature with his full address and the date of the remittance are furnished thereon,

(iii) that the correct head of account to which the amount should be credited in Government account is clearly written on the chalan, either by the remitter or by the departmental officer on whose account the amount is deposited.

(iv) that where the chalans are accompanied by cheques or drafts, the latter are drawn or are endorsed in favour of the concerned branch,

(v) that the particulars of the cash or cheques or drafts are entered on the reverse of the challans in the space provided therefor, and

(vi) that the amounts creditable to different heads of accounts are not entered in the same chalan.

15. After scrutinising the chalan and satisfying himself that the amount of cash, cheque or draft as tendered agrees with the amount shown on the chalan, the receiving counter clerk or teller will issue a paper token to the depositor to facilitate delivery of the receipted chalan to him. In the case of chalans accompanied by cheques or drafts the counter clerk will indicate on the token the date on which the receipted chalan will be available for delivery to the depositors. Paper tokens of different colours, serially numbered, may be used for tenderers of cheques or drafts or cash as the case may be. The token number will be recorded at the time of its issue on the receipt portion/copy of the chalan to facilitate delivery of receipted chalans to depositor.

16. All receipts on account of Government will be entered in a receipt scroll in triplicate or quadruplicate, as the case may be, in the form set out in Form 3, with separate column for cash, transfer and clearing. Chalans with cheques or drafts will be entered in the clearing column of the scroll as on the date on which the proceeds of the cheques or drafts are expected to be realised. A separate scroll will be prepared for each department or formation of the Ministry, and for each major head of account, if required by the department or formation of that Ministry. The serial number of the entry in the scroll will be recorded on the right hand top corner of the chalan (the same number appearing on all the copies of a set) to facilitate identification and future reference. Each day's scroll will also be given a running serial number for the accounting year from 1st April to 31st March, separate serial No. being given to scrolls of each account to facilitate detection of any omission in submitting the daily scrolls. All copies of the chalans will be branded with a suitable receipt stamp containing the names of the bank, branch and centre and in the copy/copies of chalans meant for the tenderer, the amount should be written in words and figures and that challan(s) should be signed in full. However, the bank official may only initial against the amount already indicated in the body of other copies of challan(s). As regards, Government Departments, the initials and 'Cash Received' stamp of the bank affixed on the chalans should be adequate in view of the additional check available in the receipted scrolls. The receipted chalans will thereafter be handed over to the counter clerk for delivery to the depositors against surrender of the paper tokens issued earlier. The scroll will be totalled after the close of business every day by the receiving branch concerned and the books of the branch balanced for the day with reference to the totals of the day's scrolls and the other transactions of the branch.

17. Receipt scrolls will be prepared in triplicate or quadruplicate, as the case may be, depending on whether they are to be forwarded to the Pay and Accounts Officer or any other officer subordinate to him, the disposal of the scrolls and the procedure to be adopted for checking the particulars entered in them being the same as in the case of payment scrolls referred to in paragraph 11 above, except that for the name of a drawing and disbursing officer, the name of a departmental officer authorised to receive the scrolls and chalans by a Pay and Accounts Officer with jurisdiction or authority over him shall be substituted. Every depositor will be submitting in the normal course a copy of the chalan to the concerned departmental officer. On the basis of these chalans, the departmental officer will prepare a weekly statement of receipts giving the number and date of the chalan, name of the depositor and the amount deposited and forward the same to the designated Pay and Accounts Office. The departmental officer will also check the entries in the copy of the scroll received by him with the entries in the statement of receipts, and reconcile any discrepancy detected with the bank under advice to the Accounts Officer, Pay and Accounts Office. The Accounts Officer of the designated Pay and Accounts Office will, after exercising such further checks as may be necessary, with reference to the weekly statement of the receipts received by him directly from the concerned branch of the bank, certify the correctness in the copies of the scrolls and return the certified duplicate copies to the concerned branches, following the procedure indicated in the concluding portion of paragraph 12 above.

IV

18. The procedure relating to payments or receipts on Government account at the branches of the public sector banks has been indicated in the preceding sections. The arrangements for clearing the transactions on Government account and other connected details are dealt with in the paragraphs, which follow.

19. Simultaneously with the despatch of copies of scrolls as detailed in paragraphs 12 and 17 above, the branch conducting Government business will report the daily receipts and disbursements to its head office or designated link office in a daily Memo in the forms set out in Form 4 and 5 and obtain or pass reimbursement of the amount paid or received on Government account from or to the head office or link office through the usual inter-branch accounting procedure of the bank. If the net daily amount disbursed or received is Rs. 1 lakh or more, the report will be sent by telex or telegram. The head office or link office of the bank in turn will consolidate the receipts and disbursements made by the bank's various branches and the daily consolidated statements in the form set out in Form 6 and 7 will be sent by it to the office of the Reserve Bank of India maintaining the Ministry's account, copies being sent to the office of the Reserve Bank maintaining the bank's principal account. On receipt of the daily statement, the Reserve Bank office maintaining the principal account of the bank will credit or debit the bank's principal account with the net amount disbursed or received by its branches as per the statements by debit or credit to the Reserve Bank Office maintaining the Ministry's account through General Account, and the Reserve Bank's office will respond by debiting and crediting the concerned Ministry's account maintained in a subsidiary ledger with the total receipts and payments at the branches of the public sector bank.

20. The branches of public sector banks receiving moneys and making disbursements on account of Government will also prepare monthly statements of disbursements and receipts in forms set out in Form 8 and 9 in quadruplicate on the basis of the certified daily scrolls and send three copies each to the Pay and Accounts Office concerned by the 8th of the succeeding month. The Pay and Accounts Office will scrutinise the monthly statements prepared by the branch of the public sector bank, return one copy each to the concerned branch with a certificate to the effect that the statements have been  checked and found correct, forward to the office or organisation responsible for compiling the accounts of the concerned Government the second copy of the statement with his certificate and retain the third copy for his record.

21. The designated Pay and Accounts Office will submit the consolidated monthly statements referred to in paragraph 20 above to the office or organisation referred to above by the 15th of the month succeeding the month to which it relates. The monthly statement for March, for which a little extension of time is necessary, should be sent not later than the 20th of the succeeding month.

22. On receiving the certified monthly statements, the branch of the public sector bank will forward them immediately to its head office or link office, where they will be checked against the daily statements received from the concerned branch for that month.

23. After this check, the head office or link office of the public sector bank will prepare consolidated monthly statements in the forms set out in Form 10 and 11 showing the transactions at all its branches and forward their consolidated monthly statements to the concerned office of the Reserve Bank not later than the 20th of the succeeding month in the case of all months other than March, the statement for the month of March being sent by the end of April. The concerned Reserve Bank office will forward the monthly statements to the office or organisation responsible for compiling the accounts of the Government concerned by the 28th of the succeeding month in the case of all months other than March and by the 15th May in the case of March.

24. If there are cases involving clerical errors, in order to facilitate scrutiny of the relevant transactions and the reconciliation of balances, the branches will introduce a separate scroll (error scroll) for the adjustment of entries which have been already made earlier in the relevant scroll. Cases involving clerical errors may be of two categories—one requiring rectification, while other requiring rectification as well as refund/payment. The former type will occur when the paying branch includes the transaction of one Ministry/Department in the scroll of another Ministry/Department. In such a case to rectify the error, the original debit/credit will have to be transferred to the correct Ministry by contra credit/debit to the other Ministry and on payment to or refund by the banks concerned will be involved. Such errors will be settled by the concerned Pay and Accounts Office by issue of cheques drawn in favour of the other concerned Pay and Accounts office. Such errors should however, be reported to the respective Pay and Accounts Offices in separate error scrolls. with cross references to facilitate reconciliation, the error scrolls being clearly marked "Errors and omissions—Inter departmental adjustments on account of transactions already booked—Adjustments not involving payment by reimbursement to the bank". Such errors will not be reported to the head office or designated link office of the bank in daily memos. Such errors need not be incorporated in the monthly statements also as the cheques issued and chalans deposited by the concerned Pay and Accounts Offices in adjustment of these errors will figure in the monthly statements when they are booked by the respective branches of banks. The second type of error will arise when the amount shown in the scroll is different from that shown in the cheque/chalan. In such cases, the branches will introduce a separate error scroll for the adjustment of entries which have already been made earlier in the relevant scrolls. The errors will also be reported to the head office or designated link office of the bank in a separate daily memo for adjustment with the Reserve Bank. The daily memos and error scrolls in such cases will be clearly marked "Errors and omissions—Adjustments on account of transactions already booked". After the entries in the error scrolls have been checked by the Pay and Accounts Office concerned, they will be incorporated in the relevant monthly statement.

25. If the monthly statement of a branch reveals any discrepancy, when checked with the daily statements from the same branch with reference to which a monetary settlement has already taken place, the discrepancy will be advised by the head office or designated link office to the concerned branch. The adjustment will be reported by the branch to the head office or link office in a supplementary monthly statement clearly marked "Errors and omissions— Adjustments on account of transactions already cleared" and the head office or link office in turn will forward the statement after scrutiny to the concerned Reserve Bank office. There may be some instances where discrepancies are detected by the branch itself after the monthly statement for the particular month has been prepared and despatched to the head/link office. In such cases also similar supplementary monthly statements will be prepared. Each supplementary statement will be certified by the Pay and Accounts Office concerned. A copy of the supplementary statement clearly marked "Errors-omissions—Adjustments on account of transactions already cleared" will also be sent at the same time by the designated superior authority of the pay office to the integrated financial adviser.

26. All the banks receiving moneys and making disbursements on account of Government will be compensated by payment of a turn over commission at the same rate as in the case of the State Bank of India, namely, 9.25 paise per Rs. 100/- of turn-over, subject to annual adjustments for the reduction or increase in the turn-over per voucher and consequently in the cost of handling Government transactions or for increases or decreases in the total emoluments of the staff engaged in this work.

27. It will be necessary for the banks handling Government transactions to make adequate administrative arrangements for handling the receipts at the centres indicated against them. We suggest that:

(i) a cell for supervising this work may be formed at your Central office;

(ii) some selected persons may be deputed to the Reserve Bank of India or the State Bank of India for training in the preparation of scrolls and chalans and the other connected items of work;

(iii) a scrutiny of the branches concerned at each centre and of the transactions at the head office may be undertaken by the cell referred to above, with a view to finding out whether the scrolls and chalans are being despatched in time and credits are being afforded to the Ministry, department or office of Government concerned without any delay.

28. It will be desirable for every bank transacting any business under the arrangements referred to in this memorandum to open currency chests at centres where receipt and payment transactions on Government account under this scheme are likely to be handled.

29. It may be necessary for the Comptroller and Auditor General to undertake a percentage audit of the transactions under this scheme. It is, therefore, suggested that as far as possible the books and ledgers connected with Government transactions may be segregated and maintained separately.

 

Annexure-B—Form 1 

ASSIGNMENT/LETTER OF CREDIT ACCOUNT LEDGER

(1) Name of the account (in full) ...................................... (7) Amount assigned ......................................
(a) Address ........................................................ (8) Particulars of cheque books in use
(3) Account opened on ............ ..................................   
(4) Reference .................................................... Date of entry No. of the book No. of cheque forms
(5) Cheques will be signed by ........................................

.......................................................................................

(6) Special instructions, if any ........................................  

 

Date

Particulars of withdrawals Particulars of cheque Disbursements Progressive Total Initials Remark
No. Date      

 

 

Rs. P. Rs. P    

 

Annexure—B--Form 2

Name of bank.................................................. Branch

PAYMENT SCROLL 

Name of the drawer. .........................................Date....................................

Date Serial No.  Particulars of cheques Cash Clearing Transfer Progressive total Initials
No. Date Rs.  P. Rs.  P. Rs.  P. Rs.  P.

 

 

 

 

Annexure—B--Form 3 

Name of the Bank......................................Branch

RECEIPT SCROLL

Date....................................

Sr. No. Name of depositor Head of Account as mentioned in the chalan Cash Rs. P. Clearing 
Rs. P.
Transfer Rs. P. Progressive total Rs. P. Initials

 

 

 

 

ANNEXURE—B—Form 4

MEMO

....................................Bank

 Branch..............................................................                                                          Serial No..........................

........................ 198

For head/Link Office............................ ....................

State Index Letter(s) 
Transactions on behalf of Government ....................

On Account of

Disbursements 

Rs. P.

1.    
2.    
3.    

 

Total:.............................

Agent

Annexure—B—Form 5

MEMO 
......................Bank

Branch............................................................                                                    Serial No..................

........................198 

For Head/Link Office .......................................................................

State Index letter(s)

Transactions on behalf of Government..... ........................................

 

On Account of

Receipts 
Rs. P.

1.
2.
3.
   
 

Total:........................

Agent

 

Annexure—B—form 6

Name of the Bank

                                                                                                                Address

—————————————198 .

No. —————————————

The Manager, 
Reserve Bank of India,
___________________

Dear Sir,

We send you herewith daily Summary of disbursements on behalf of__________________________ at our branches for—————————————-—198 , which show a balance of Rs._________________________ in our favour. The relative Memos are also enclosed.

2. Please pass the necessary entries through our Accounts with your________________________ Office under advice to this Office.

3. A copy of this letter is being endorsed to your Deposit Accounts Department———————————————for information and necessary action.

Name of the Branch Date of transaction

Disbursements

    Rs. P.

 

 

Total Disbursements  

 

Yours faithfully,

Encls. 

Officer-in-charge.

Copy forwarded to the Manager, Reserve Bank of India, Deposit Accounts Department, —————————-----------. He may please credit our account with Rs.———————————on account of the Government transactions as stated above under advice to this Office.

Officer-in-charge.

 

ANNEXURE—B—Form 7

Name of the Bank

Address 

—-—————--198

No._________________

The Manager, 
Reserve Bank of India,

Dear Sir,

We send you herewith daily Summary of receipts on behalf of____________________________ at our branches for —————————————————198 , which show a balance of Rs.———————————————--in your favour. The relative Memos are also enclosed.

2. Please pass the necessary entries through our Account with your——————————————office under advice to this office.

3. A copy of this letter is being endorsed to your Deposit Accounts Department——————————————————————  ———————————for information and necessary action.

Name of the Branch Date of transaction

Receipts

Rs. P.
 

 

 

  Total Receipts  

 

Yours faithfully,

Encls : 

Officer-in-charge

Copy forwarded to the Manager, Reserve Bank of India, Deposit Accounts Department, —————————————————— He may please debit our account with Rs.——————————————————————on account of the Government transactions as stated above under advice to this office.

Officer-in-charge

 

 

Annexure—B—Form 8 

State :————————————————————

Name of the Bank———————————————————————————Branch

Monthly Statement of Disbursements on
account of—————————————
for the month of——————————198 .

Date

Disbursements

Rs. P.
 
 

Total

 

 

Name of the Bank,

Officer-in-charge

—————————————————198 .

 

  

Annexure—Bform 9 

State:———————————————————————————

Name of the Bank——————————————————Branch

Monthly Statement of Receipts on account
of—————————————————————for the
month of—————————————————198 .

Date

Receipts

Rs. P.

 

 

Total

   
 

 

Name of the Bank,

—————————————————————198 .

Officer-in-charge

 

 

Annexure—B—form 10

State: ——————————————————————————

Name of the Bank —————————————————————

Monthly Statement of Branchwise Disbursements on
account of————————————————————————
for the month of————————————————198

Branch

Disbursements
Rs. P.

 

 

Total 
Disbursements

   

 

 

Name of the Bank:———————————————————

Head/Link Office :———————————————————

Dated : ————————————————————————

Officer-in-charge

 

 

Annexure—B—form 11

State:———————————————————

Name of the Bank ————————————

Monthly Statement of Branchwise Receipts 
on account of———————————————
for the month of————————————198 .

Branch

 

Receipts
Rs. P.

 

 

Total Receipts

 

 

   

Name of the Bank :——————————�-

Head/Link Office :————————————

Dated:—————————————————

Officer-in-charge

 

 

APPENDIX 'C' TO CHAPTER I 

[Refer Correction Slip 149]

(Referred to in, Para 1.7.3)

INSTRUCTIONS REGARDING THE PROCEDURE FOR INDENTING SAFE-CUSTODY, ISSUE AND ACCOUNTAL OF CHEQUE BOOKS IN THE DEPARTMENTALISED ACCOUNTING SYSTEM.

It has been decided after consultation with the Comptroller & Auditor General of India that the following procedure will be followed in regard to indenting, safe-custody, issue and accountal of cheques/cheque books in the Ministries/Departments in which the Departmentalised accounting system has been introduced.

2. ANNUAL INDENT

The supply of cheque-books of different varieties (see paragraph 13 below) required for making payments by the Pay and Accounts Officers and cheque drawing departmental officers will be made by the Controller of Stamps, Nasik Road For this purpose all the Pay and Accounts Offices should intimate their requirements of cheque books including the requirements of cheque-drawing officers in their jurisdiction, for the next financial year to the Integrated Financial Adviser of the concerned Ministry/Department before the 15th January every year.

3. ASSESSING THE REQUIREMENTS

The annual requirements should be based on the average of the actual consumption of cheque forms during the preceding calendar year i.e. from January to December of the previous year. Additional provision may be made while preparing the indent for extra requirements which can be anticipated during the next financial year. The stock in hand as well as the requirement of cheque books for the remaining three months of the current financial year, should also be taken into account. To the requirements so worked out, a reserve stock of cheque books equal to approximately three months' requirement, should be added, to meet unforeseen requirements and to safeguard against delay in printing, transmission etc.

4. PREPARATION AND SENDING OF CONSOLIDATED INDENT BY F. A.

Based on requirements intimated by all the Pay and Accounts Officers, as consolidated annual indent will be prepared by the Financial Adviser through the Pr. A. O. indicating the requirements of different varieties of cheque books and sent to the Controller of Stamps, Nasik Road by the end of January every year. Specimen signatures of an Officer in the Principal Accounts Office will be sent to the Controller of Stamps, Nasik Road by the F.A.

The total requirements of cheques of each Ministry/Department will be sent by the Press to the indenting officers of the Ministry/Department concerned who will in turn have to despatch the requisite number of cheques to different PAOs/Cheque drawing DDOs (including those at outstations under their control). The name of the Ministry/Department/Organisation/PAO and also the name of the branch of the bank will have to be stamped by means of a rubber stamp, on the cheques before issue.

5. ACCOUNTING VERIFICATION OF SERIAL NUMBER ETC.

The cheque books received from the Controller of Stamps, Nasik Road will contain machine-numbered cheque forms. On receipt of the bulk supply of cheque books, they should be carefully scrutinised under the supervision of the officer-in-charge to see that each book contains the number of cheque forms specified therein, and that serial numbers printed thereon are in consecutive order. The actual counting of the cheques and the checking of their serial numbers may be done by the Junior Accountants of the Sections who will sign each book in full in token of having conducted the check. The cheque-cashier and the officer-in-charge, will test check 10 per cent and 5 per cent respectively, of the cheque books checked by the Junior Accountants and should sign in the books so test checked by them.

There is no objection if the Principal Accounts Office, immediately on receipt of the cheque books, supplies these cheque books in the same sealed packets as received from the Security Press, to the different P.A.Os. under its control as per their indents processed and consolidated by the Pr. A. 0. It shall then be the responsibility of the receiving PAO to open the packets and verify the correctness of cheque-leaves/cheque books as per instant orders and take the cheque books on stock. In case any discrepancy is noticed by the PAO on receipt of the packets the PAO should bring it to the notice of the Pr. A.O. immediately, who shall take up the matter with the India Security Press from whom the cheque books are received.

The cheque books received in excess of the annual requirements of the PAOs would, however, continue to be retained in the Pr. A. 0. who shall verify the correctness of the cheque books/cheque leaves and take them on stock.

6. CUSTODY AND STORAGE

The cheque books will remain, in joint custody of the cheque-cashier and the officer in charge. The stock of blank cheque books should be stored in a steel almirah with double lock of which one key should be kept by the Officer in Charge and other by the Cheque-Cashier. The duplicate set of keys will be kept in an envelope duly sealed by the Officer in Charge and the Cheque-Cashier, in the custody of the Head of the Office/Principal Accounts Officer. In the case of an outstation Pay & Accounts Office comprising only one Accounts Officer, the duplicate set of keys duly sealed in a cover, may be kept in the relevant branch of the bank with which the PAO is in account.

Note:- If the double lock system for custody of cheque books is not feasible in any office owing to the smallness of the establishment or lack of facilities, the cheque books should be in the custody of the Head of the Office under lock and key. The Head of the Office will be responsible for their safe custody and issue, to the Cashier as and when required, of the required number of cheque books.

[Refer Correction Slip 138]

7. STOCK REGISTER OF CHEQUE-BOOKS

A Stock Register of Cheque Books/Forms should be maintained to keep an account of the receipts, issues and balance of cheque books/forms (Form CAM 1). Each morning, the Cheque-Cashier should take such cheque books from the Officer in Charge, as are likely to be used during the course of the day and should remain responsible for their use and return of the balance at the close of the day. Another register should be maintained by the cashier for showing the cheque forms received by him each day and those returned by him. The entry should be made by the Cashier with his dated initials in this register.

8. ISSUE OF CHEQUE BOOKS TO DRAWING AND DISBURSING OFFICERS

The Drawing and Disbursing Officers vested with cheque drawing powers, will requisition their requirement of cheque books from the concerned Pay and Accounts Office. The latter will supply to the DDO the minimum number of cheque books, sufficient for his requirement for three months. Issue of such books will also be entered in the stock Register of Cheque books.

In cases where the power of drawal of funds by cheque(s) is withdrawn from any cheque drawing DDO, all the unused forms from partly used cheque books with that officer shall be defaced by writing the word 'cancelled' promptly across each cheque form and its counter-foil (but without the signature of the Drawing Officer) and returned to the Pay & Accounts Officer concerned who shall destroy them after keeping a note in the relevant records. All unused cheque books with such an officer shall, however, be returned by him to the Pay and Accounts Officer without any cancellation. Such cheque books shall be taken into stock in the Stock Register of cheque books held by the Pay and Accounts Officer and shall be re-issued to any other Cheque Drawing DDO under his account control or to his own office.

If and when a Pay and Accounts Office is wound up, all partly used/wholly unused cheque books in the custody of that office shall be returned along with a complete accountal of cheque books so remaining as per the Stock Register, to the Principal Accounts Office, which will in turn take action on the same lines as indicated in the above sub-para.

[Refer Correction Slip 137]

9. DAILY ACCOUNT OF CHEQUE BOOKS USED

An account of cheque forms used daily should be maintained by the Cashier in (Form CAM 2) and submitted to the Officer in Charge at the time of closing of the accounts daily. In this register the cheque numbers used during the day should also be noted.

10. ACCOUNT OF CHEQUES BY D. D. Os.

The Drawing and Disbursing Officers enjoying cheque drawing powers will also maintain the account of cheque books and the cheques used daily in the same form as detailed in para 7 and 9.

11. STOCK TAKING AT THE CHANGE OF THE OFFICER IN CHARGE

Every six months, in April and October, stock taking of the cheque books should be done by an officer other than the officer-in-charge (cheques) and a certificate of physical count recorded by him in the stock register. This stock taking should also be done whenever there is a change of the officer in charge (cheques) and the relieving officer should initial the entry in respect of each of the cheque book noted in the Form—CAM-2 and sign a certificate in the Stock Register in the following form :—

"Received the current cheque books as indicated by my initials in the register of account of cheque forms and the unused cheque books from ... .to... .as entered in the Stock Register".

Note: In the case of a Pay and Accounts Office comprising only one Accounts Officer, half-yearly physical verification of stock of cheque-books may be arranged as indicated below:

(a) if at any station, there is more than one such Pay and Accounts Office functioning under a Principal Accounts Officer, mutual physical verification may be entrusted among those Pay and Accounts Offices;

(b) if at any station, there is only one such Pay and Accounts Office under a Principal Accounts Officer but there are Pay and Accounts Offices functioning under other/another Principal Accounts Officer, the Principal Accounts Offices by mutual consultation could arrange for the physical verification between their Pay and Accounts Offices;

(c) if a single such Pay and Accounts Office is located at any station, then the physical verification may be conducted by the Inspecting Officer of the internal inspection party entrusted with the inspection of that office or by any other gazetted officer (including Dy. Controller of Accounts, Controller of Accounts, or Chief Controller of Accounts) who visits the office on any official work.

In the case of a cheque drawing D.D.O., the physical verification can be entrusted either to the Inspecting Officer of the internal inspection party conducting the normal inspection of his office or by any gazetted officer of his Department who visits that office on any other official work.

[Refer Correction Slip130]

12. INTIMATION TO BANK REGARDING USE OF CHEQUE BOOKS

Before the cheque books are actually brought into use, during a particular period, the officer in charge (cheques) shall send intimation in Form CAM 3 to the bank upon which he draws the cheque, notifying the serial numbers of the cheque books and the number of cheques contained therein.

The Drawing and Disbursing Officers authorised to issue cheques will intimate the cheque numbers etc. to the bank as well to the Pay and Accounts Office.

13.— * * * (not printed.)

14. Whenever facilities are available, cheques will be written by means of cheque perforating machines which will use indelible chemical ribbon, to give adequate safeguards against fraudulent alteration in the cheques. The cheque forms for this purpose will have to be obtained, not in the form of bound books but in the form of rolls. The indent for such rolls should be made separately from that for bound cheque books and separate account of such cheques should be maintained.

15. Whenever cheques in book form are used, the details of the payee, the amount and date should be filled in the counterfoil.

(Vide Ministry of Finance, Department of Expenditure, Special Cell O.M. No. F. 2(27)/76-SC dated 14-5-1976, DO letter No. F.2.(12)/76-Spl.-Cell/ 1490—1503 dated 16-8-1976 and CGA's O.M. No. S. 11019/App.4/78/TA/ 4652 dated 28-7-1979).