General Financial Rules, 2017 — Study Notes

• 💰All moneys received by or on behalf of the Government — whether as dues of Government, for deposit, remittance, or otherwise — shall be brought into Government Account without delay.
• 📜This shall be in accordance with such general or special rules as may be issued under Articles 150 and 283(1) of the Constitution.

• ⚖️Under Article 284 of the Constitution, all moneys received by or deposited with any officer employed in connection with the affairs of the Union — other than revenues or public moneys raised or received by Government — shall be paid into the Public Account.
• 🏛️All moneys received by or deposited with the Supreme Court of India, or with any other Court (other than a High Court) within a Union Territory, shall also be dealt with similarly — paid into the Public Account.

• 📋The head of account to which such moneys shall be credited and the procedure for withdrawal shall be governed by the:
  • 📌Government Accounting Rules, 1990, and
  • 📌Central Government Account (Receipts and Payments) Rules, 1983, or such other general or special orders as may be issued in this behalf.

• 🏛️It is the duty of the Department of the Central Government concerned to ensure that the receipts and dues of the Government are:

• 1️⃣Correctly assessed
• 2️⃣Promptly collected
• 3️⃣Duly credited to the Consolidated Fund or Public Account as the case may be.

• 📊The Controlling Officer shall arrange to obtain from his subordinate officers monthly accounts and returns in suitable form, claiming credit for the amounts paid into the treasury or bank.
• 🔄He must compare these accounts with the statements of credits furnished by the Accounts Officer to verify that amounts reported as collected have been duly credited.
• 📄Each Accounts Officer shall send an extract from his accounts showing amounts brought to credit each month to the Controlling Officer concerned.

• 📋Detailed rules and procedures regarding assessment, collection, allocation, remission and abandonment of revenue and other receipts shall be laid down in the regulations of the Department responsible for the same.

• 🗂️In departments where officers receive money on behalf of Government and issue receipts in Form GAR-6, the departmental regulations must provide for:
  • 📌Maintenance of a proper account of the receipt and issue of receipt books.
  • 📌The number of receipt books to be issued at a time to each officer.
  • 📌A check with the officer's accounts of the used books when returned.

• ⏰Amounts due to Government shall not be left outstanding without sufficient reasons.
• 📋Where such amounts appear to be irrecoverable, the orders of the competent authority shall be obtained for their adjustment.

• ⛔Unless specially authorised by any rule or order made by competent authority, no sums shall be credited as revenue by debit to a suspense head.
• ✅The credit must follow and not precede actual realisation.

• 📊An Administrator or Head of a Department responsible for the collection of revenue shall keep the Finance Ministry fully informed of:
  • 📈The progress of collection of revenue under his control.
  • ⚠️All important variations in such collections as compared with the Budget Estimates.
• 📋This is subject to any general or special orders issued by the Department of the Central Government concerned.

• 🏢When the maintenance of any rentable building is entrusted to a civil department (other than the Central Public Works Department), the Administrator or Head of Department concerned shall be responsible for the due recovery of rent thereof.

• 📋The procedure for assessment and recovery of rent of any building hired out will be regulated generally by the rules applicable to buildings under the direct charge of CPWD.

• 📂Detailed rules regarding demand and recovery of rent of Government buildings and lands are contained in the departmental regulations of the departments in charge of those buildings.

• ⚖️Every authority having the power to impose and/or realise a fine shall ensure that the money is:
  • ✅Realised
  • ✅Duly checked
  • ✅Deposited into a treasury or bank as the case may be.

• ⛔Every authority having the power to refund fines shall ensure that:
  • 🚫No double refunds of amounts of fines collected are made.
  • 🚫No refunds of fines not actually paid into a treasury or bank are made.

• 👀Accounts Officers shall watch the realisation of miscellaneous demands of Government not falling under the ordinary revenue administration.
• 📋Examples include contributions from:
  • 🏛️State Governments
  • 🏙️Local Funds
  • 🏗️Contractors and others towards establishment charges

• ⛔A claim to revenue shall not be remitted or abandoned save with the sanction of the competent authority.

• 📅Administrators and Heads of Departments (other than those in the Department of Posts) shall submit annually on 1st June to the Audit Officer and Accounts Officer concerned, statements showing:
  • 📌Remissions of revenue and abandonments of claims to revenue sanctioned during the preceding year by competent authorities.
  • 📌Exercised otherwise than by law or rule having the force of law.
• 💡Threshold: Individual remissions below ₹1,000 need not be included in the statements. ⭐ ₹1,000 limit

• 📋Remissions and abandonments should be classified broadly with reference to the grounds on which they were sanctioned.
• 📊A total figure should be given for each class, with a brief explanation of circumstances leading to the remission for each class.

• 📋Departments of the Central Government and Administrators may make rules defining remissions and abandonments of revenue for the purpose of Rule 19.

Every officer incurring or authorising expenditure from public moneys should be guided by high standards of financial propriety and enforce financial order, strict economy, and compliance with all financial rules. The following four principles are specifically emphasised:

• 💡Every officer is expected to exercise the same vigilance in respect of expenditure from public moneys as a person of ordinary prudence would exercise in respect of his own money.

• 💸The expenditure should not be prima facie more than the occasion demands. Economy and proportionality are the watchwords.

• ⛔No authority should exercise its powers of sanctioning expenditure to pass an order which will be directly or indirectly to its own advantage. No one shall be a judge in his own cause.

• 🚫Expenditure from public moneys should not be incurred for the benefit of a particular person or a section of the people, unless —
  • ✅(a) A claim for the amount could be enforced in a Court of Law, or
  • ✅(b) The expenditure is in pursuance of a recognised policy or custom.

• ⛔No authority may incur any expenditure or enter into any liability involving expenditure or transfer of moneys for investment or deposit from public funds (Consolidated Fund / Contingency Fund / Public Accounts) unless the same has been sanctioned by a competent authority.

• 📋The financial powers of the Government have been delegated to various subordinate authorities vide the Delegation of Financial Powers Rules (DFPR), as amended from time to time.
• 🏛️The financial powers of the Government which have not been delegated to a subordinate authority shall vest in the Finance Ministry.

• 🤝All draft memoranda for the following committees/bodies shall be circulated by the Ministry or Department concerned after consultation with the Financial Adviser of that Ministry or Department:
  • 📌Expenditure Finance Committee (EFC)
  • 📌Public Investment Bureau (PIB)
  • 📌Committee on Establishment Expenditure (CEE)
  • 📌Cabinet Committee for Economic Affairs (CCEA)
  • 📌Cabinet
• 📝A confirmation to this effect (that FA consultation has been done) shall be included in the draft memorandum at the circulation stage. ❗ Exam point

• 📋All sanctions to expenditure shall indicate the details of the provision in the relevant grant or appropriation wherefrom such expenditure is to be met.

• 📊All proposals for sanction to expenditure shall indicate whether such expenditure can be met by valid appropriation or re-appropriation.

The Controlling Officer must ensure four things in respect of funds placed at his disposal:

• 1️⃣That the expenditure does not exceed the budget allocation.
• 2️⃣That the expenditure is incurred for the purpose for which funds have been provided.
• 3️⃣That the expenditure is incurred in public interest.
• 4️⃣That adequate control mechanisms are functioning in his Department for:
  • 🔍Prevention and detection of errors and irregularities in financial proceedings of subordinate offices.
  • 🛡️To guard against waste and loss of public money.

• 📅Subject to fulfillment of the provisions of DFPR, all rules, sanctions or orders shall come into force from the date of issue, unless any other date from which they shall come into force is specified therein.

• 📝Orders sanctioning the creation of a temporary post should, in addition to the sanctioned duration, invariably specify the date from which it is to be created.

Except in pursuance of the general delegation made by, or with the approval of the President, a subordinate authority shall not, without the previous consent of the Finance Ministry, issue an order which involves:

• 🏞️(i) Any grant of land, or assignment of revenue, or concession, grant, lease or licence of mineral or forest rights, or rights to water, power or any easement or privilege of such concessions, or
• 💸(ii) Relinquishment of revenue in any way.

All financial sanctions and orders issued by a competent authority shall be communicated to the Audit Officer and the Accounts Officer. The procedure is detailed in twelve sub-clauses, the key ones being:

• 🔹(i) Sanctions relating to a matter concerning the Department proper, on the basis of which payment is to be made or authorised by the Accounts Officer — should be addressed to the Accounts Officer.
• 🔹(ii) All other sanctions should be accorded in the form of an Order — a copy thereof should be endorsed to the Accounts Officer concerned.
• 🔹(iii) For non-recurring expenditure, the sanctioning authority may accord sanction by signing or countersigning the bill or voucher instead of a separate sanction letter.
• 🔹(vi) All orders conveying sanctions to expenditure of a definite amount shall express the amount both in words and figures.
• 🔹(xi) Copies of all sanctions/orders shall be endorsed to Audit Officers, except the following categories (which need not be sent to audit):
  • 🚫Advances to Central Govt. employees
  • 🚫Appointment, promotion or transfer of Gazetted/Non-Gazetted officers
  • 🚫Creation, continuation or abolition of posts
  • 🚫Handing over/taking over charge
  • 🚫GPF advances to Government servants
  • 🚫Contingent expenditure under powers of Head of Office
  • 🚫Other routine sanctions by Heads of Subordinate Officers

• ⏰A sanction for any fresh charge shall, unless specifically renewed, lapse if no payment has been made (in whole or in part) during a period of twelve months from the date of issue. ❗ 12 months

Notwithstanding Rule 30, the following sanctions shall not lapse:

• ✅A sanction in respect of an addition to a permanent establishment made from year to year under a general scheme by a competent authority.
• ✅A sanction in respect of an allowance sanctioned for a post or for a class of Government servants but not drawn by the officer(s) concerned.

• 📋The remission of disallowances by Audit and writing off of overpayments made to Government servants by competent authorities shall be in accordance with the provisions of the Delegation of Financial Powers Rules and instructions issued thereunder.

• 🚨Any loss or shortage of public moneys, departmental revenue, stamps, opium, stores or other Government property — irrespective of the cause of loss and manner of detection — shall be immediately reported by the subordinate authority to:
  • 📌The next higher authority
  • 📌The Statutory Audit Officer
  • 📌The concerned Principal Accounts Officer
• ✅Reporting is required even when the loss has been made good by the party responsible for it.

• ⚠️Cases involving serious irregularities shall also be brought to the notice of:
  • 📌Financial Adviser or Chief Accounting Authority of the Ministry or Department
  • 📌Controller General of Accounts, Ministry of Finance

• 🔄The complete report shall reach through proper channels to the Head of Department, who shall finally dispose of it under his delegated powers.
• 🏛️Reports which he cannot finally dispose of under his delegated powers shall be submitted to the Finance Ministry.

• 💰An amount lost through misappropriation, defalcation, embezzlement etc. may be redrawn on a simple receipt pending investigation, recovery or write-off — with the approval of the authority competent to write-off the loss in question.

• 🏛️In cases of loss due to culpability of Government servants, the loss should be borne by the Central Govt. Department or State Govt. concerned with the transaction.
• ✅If any recoveries are made from the erring official in cash, the receipt will be credited back to the Government that sustained the loss.

• 📄All cases involving loss from erroneous or irregular issue of cheques or irregular accounting of receipts shall be reported to the Controller General of Accounts along with the circumstances — so that defects in rules or procedures can be remedied.

• 🔥Departmental Officers shall, in addition to taking action under Rule 33, follow the provisions below in cases involving material loss or destruction of Government property as a result of fire, theft, fraud, etc.
• 🚔All losses above ₹50,000 due to suspected fire, theft, fraud, etc., shall be invariably reported to the Police for investigation as early as possible. ❗ ₹50,000 threshold for Police
• 🤝Once the matter is reported to the Police, all concerned must assist the Police in their investigation.
• 📋A formal investigation report shall be obtained from the Police Authorities in all cases referred to them.

• 🌪️All loss of immovable property exceeding ₹50,000 — such as buildings, communications, or other works — caused by fire, flood, cyclone, earthquake or any other natural cause — shall be reported at once by the subordinate authority to Government through the usual channel. ❗ ₹50,000 threshold
• 📢All other losses (below ₹50,000) should be immediately brought to the notice of the next higher authority.

• 🔎After a full enquiry into the cause and extent of the loss has been made, the detailed report should be sent by the subordinate authority concerned to Government through the proper channel.
• 📬A copy of the report or an abstract thereof shall be simultaneously forwarded to the Audit Officer and the Pay and Accounts Officer.

• 👤An officer shall be held personally responsible for any loss sustained by the Government through fraud or negligence on his own part.
• 🔗He shall also be held personally responsible for any loss arising from fraud or negligence of any other officer to the extent to which it may be shown that he contributed to the loss by his own action or negligence.
• 📋Departmental proceedings for assessment of responsibility shall be conducted according to the instructions contained in Appendix 1 and those issued by the Ministry of Personnel from time to time.

• ⚡Action at each stage of detection, reporting, write-off, and final disposal shall be completed promptly.
• 👮Special attention must be given to:
  • ⚖️Action against delinquents.
  • 🛡️Remedial measures taken to strengthen the control system.

• 🤝A subordinate authority shall afford all reasonable facilities to the Audit Officer and Pay and Accounts Officer for the discharge of his functions.
• 📄Shall furnish the fullest possible information required for:
  • 📌Preparation of any official account or report
  • 📌Payments
  • 📌Internal audit

• ⛔A subordinate authority shall not withhold any information, books or other documents required by the Audit Officer or Accounts Officer.

• 🔒If the contents of any file are categorised as 'Secret' or 'Top Secret', the file may be sent personally to the Head of the Audit Office, specifying this fact.
• 📋The Head of the Audit Office will then deal with it in accordance with the standing instructions for handling and custody of such classified documents.

• 📅The financial year of the Government shall commence on the 1st day of April of each year and end on the 31st day of March of the following year.

• 🏛️In accordance with Article 112(1) of the Constitution, the Finance Minister shall arrange to lay before both the Houses of Parliament an Annual Financial Statement (also known as the 'Budget') showing the estimated receipts and expenditure of the Central Government in respect of a financial year, before the commencement of that year.

• 🚂The receipts and expenditure of the Railways (a departmental commercial organisation) form part of the Government's receipts and expenditure and are included in the Annual Financial Statement.
• 📅With the merger of Railway Budget with the General Budget, the Demands for Grants and the Statement of Budget Estimates of Railways shall be part of the General Budget with effect from 2017-18. ⭐ Exam point

• ⚖️The provisions for preparation, formulation and submission of budget to Parliament are contained in Articles 112 to 116 of the Constitution of India.

• 📋The Ministry of Finance, Budget Division shall issue guidelines for preparation of budget estimates from time to time. All Ministries/Departments shall comply in full with these guidelines.

The budget shall contain the following:

• 1️⃣Estimates of all revenues expected to be raised during the financial year to which the budget relates.
• 2️⃣Estimates of all expenditure for each programme, scheme and project in that financial year.
• 3️⃣Estimates of all interest and debt servicing charges and any repayments on loans in that financial year.
• 4️⃣Any other information as may be prescribed.

• 📊Detailed estimates of receipts shall be prepared by the estimating authorities separately for each Major Head of Account in the prescribed form.
• 📋For each Major Head, the estimating authority shall give the break-up of the Minor / Sub-head / Detailed-wise estimate along with actuals of the past three years. ⭐ Past 3 years actuals
• 🔍Item-wise break-up of all major items of tax and non-tax revenues shall be clearly identified and depicted in the receipt estimates.
• 📝Any major variation in estimates with reference to past actuals or Budget Estimates shall be supported by cogent reasons.
• 🏛️Accounting heads under which major tax and non-tax revenues are collected shall be prescribed by the administrative Ministry in consultation with Budget Division, MoF.

• 💰While tax revenues, non-debt capital receipts (including disinvestments) and borrowings are managed by the various Departments of the Ministry of Finance —
• 🏛️Non-tax revenues are collected through all Ministries/Departments and other autonomous bodies and implementing agencies, comprising an important source of revenue for the Government.

• 💡'User Charges' is an important component of non-tax revenues. Each Ministry/Department shall identify the user charges levied by it and publish them on its website.

• 1️⃣User charges must recover the current cost of providing services with a reasonable return on capital investment.
• 2️⃣Any deviation from cost-recovery norms shall be specifically recorded with reasons.
• 3️⃣Rates of user charges shall be linked with appropriate price indices and reviewed at least every three years. ❗ Every 3 years
• 4️⃣To enable ease of revision, user charges shall be fixed, wherever possible, through Rules or executive orders — not through a statute. ⭐ Exam point

• 📈Dividends and profits — including the transfer of surplus from the Reserve Bank of India — are a major component of non-tax revenues.
• ⚡Payment of dividends/profits by Central Public Sector Enterprises (CPSEs) shall not be delayed and must be paid within an appropriate time frame immediately after the decision on dividend is taken in the AGM.
• 👀Ministries or Departments shall monitor timely payments of dividends and profits.
• 📋The dividend shall be payable as per the guidelines issued by DIPAM (Department of Investment and Public Asset Management).

• 💻The Government has provided a public portal for online collection of various non-tax revenues including fees and user charges through e-Receipts.
• 🚀All Ministries/Departments shall take prompt measures for migration to e-Receipts, to ensure:
  • 👤Customer convenience
  • ⚡Immediate credit of receipts to the Government account

• ⚖️The expenditure estimates shall show separately:
  • 📌Sums required to meet expenditure Charged on the Consolidated Fund under Article 112(3) — no vote required.
  • 📌Sums required to meet other expenditure for which a vote of Lok Sabha is required under Article 113(2) — voted expenditure.

• 📊Estimates shall also distinguish provisions for Revenue Account from Capital Account, including loans by the Government and repayment of loans, treasury bills, cash management bills, and ways and means advances.

• 🔍Detailed estimates of expenditure shall be prepared up to the final unit of appropriation (Object Head) under prescribed Major and Minor Heads for both Revenue and Capital expenditure.
• 📋Estimates shall include suitable provision for liabilities of the previous years to be discharged during the year.

• 📋The estimates for expenditure for which a vote of Lok Sabha is required shall be in the form of Demands for Grants.

• 🏛️Generally, one Demand for Grant is presented in respect of each Ministry or Department. However, for large Ministries, more than one Demand may be presented.
• 📊Each Demand normally includes provisions required for a service — i.e., revenue expenditure, capital expenditure, grants to State and UT Governments, and loans and advances relating to the service.

• 📋The form of the Annual Financial Statement and Demands for Grants shall be laid down by the Finance Ministry — no alteration of arrangement or classification shall be made without the approval of that Ministry.
• 🔑The heads under which provision for expenditure shall be made shall be prescribed by the Finance Ministry in consultation with the Administrative Ministry or Department. The authorised heads for a year shall be as shown in the Detailed Demands for Grants passed by Parliament — no change without formal MoF approval.
• 🔄The major head-wise provisions in the Detailed DFG must match with the provision made in the Demands for Grants presented by Budget Division, as appropriations are sought on the basis of Demands for Grants.

• 🔍The estimates of receipts and expenditure of each Ministry/Department shall be scrutinised in the Budget Division, Ministry of Finance.
• 🤝Secretary (Expenditure) may hold pre-budget meetings with Secretaries or Financial Advisers of Administrative Ministries/Departments to discuss the totality of requirements.
• 📊The estimates initially submitted may undergo changes as a result of scrutiny and pre-budget meetings. The final estimates arrived at on the basis of scrutiny and meetings shall be incorporated in the Budget documents.

• 🎯After finalisation of budgetary allocations, the Department of Expenditure in consultation with NITI Aayog and the concerned Ministries shall prepare an Outcome Budget Statement linking outlays against each scheme/project with the outputs/deliverables and medium-term outcomes.
• 📊Outputs/deliverables shall be mandatorily given in measurable/quantitative terms on the basis of parameters decided in advance, based on projections in the Medium-Term Expenditure Framework (MTEF) Statement.
• 🔒Allocations shall be against a firm set of deliverables which shall be adhered to.
• 📈The performance against specified outcomes would form the basis of deciding on the continuation of the scheme and the quantum of budget allocation.

• ⏰If the Appropriation Bill is likely to be passed after the start of the financial year to which it corresponds, the Finance Ministry may obtain a 'Vote on Account' to cover expenditure for a brief period — in accordance with the provisions of Article 116 of the Constitution.

• 📤After the Appropriation Bill relating to the Budget is passed, the Ministry of Finance shall communicate the grants and appropriations to the Ministries/Departments.
• 🔄Ministries/Departments shall in turn distribute the same to their subordinate formations.
• 📢The distribution made shall also be communicated to the respective Pay and Accounts Officers, who shall exercise check against the allocation to each subordinate authority.

• 🏛️The Departments of the Central Government shall be responsible for the control of expenditure against the sanctioned grants and appropriations placed at their disposal.
• 🔗Control shall be exercised through Heads of Departments, other Controlling Officers, and Disbursing Officers subordinate to them.

• 📅A Grant or Appropriation can be utilised only to cover charges to be paid during the financial year of the Grant or Appropriation and adjusted in the account of the year.
• ⛔No charges against a Grant or Appropriation can be authorised after the expiry of the financial year.

• 📌DDO's key duties on bills: (a) Prepare charged and voted bills separately; (b) Enter complete accounts classification from major head to object head; (c) Enter progressive total of expenditure up to date on each bill.
• 📅Returns from DDOs due to HoD by 3rd of each month. If no entries, a 'Nil' statement must still be sent.

• 🔄The Head of the Department and the Accounts Officer shall be jointly responsible for the monthly reconciliation of departmental figures with those in the Accounts Officer's books.
• 📋DDOs shall maintain a Bill Register in Form TR 28-A and note all bills presented to the PAO.
• 📅DDO shall furnish a certificate of agreement to the PAO by the last day of the month following the month of accounts.
• 📊HoD shall furnish a quarterly certificate to the Principal Accounts Officer certifying correctness of figures for the quarter — by the 15th of the second month following the end of each quarter. ❗ Exam point

• 📅Departments shall obtain Form GFR 8 figures from HoDs by the 15th of the month following the month to which the returns relate.
• ⚠️If Accounts Office figures are found to be higher than departmental figures, the Accounts Office figures shall be assumed to be correct — as appropriation accounts are prepared on that basis.

• 📈Departments shall also obtain statements showing physical progress of the schemes — name of scheme, Budget provision, progressive expenditure, progress in physical terms, and detailed reasons for shortfalls or excess against both physical and financial targets.

• 📋A Broadsheet in Form GFR 9 shall be maintained by the Departments of Central Government or each HoD to watch the prompt receipt of various returns and to rectify any defaults.

• 📋In order to maintain proper control over expenditure, a Controlling Officer shall obtain from the spending authorities liability statements in Form GFR 3-A every month, starting from the month of October in each financial year. ⭐ From October
• 📒The Controlling Officer shall also maintain a Liability Register in Form GFR 3.

• 👤A Head of Department or Controlling Officer shall be in a position to estimate the likelihood of savings or excesses every month and to regularise them in accordance with the instructions laid down in Rule 62.

• ⚠️The Accounts Officer shall report to the Head of the Department immediately on the first appearance of any disproportionate expenditure, particularly in respect of recurring items of expenditure under any grant, appropriation, or a primary unit thereof.
• 🔑However, the authority administering a grant/appropriation is ultimately responsible for the control of expenditure — not the Accounts Officer.

• 1️⃣The Accounts Officer shall not allow any payment against sanctions in excess of the Budget provisions unless there is specific approval of the Chief Accounting Authority.
• 2️⃣The Financial Advisers and Chief Accounting Authority, before according concurrence for excess under any Head, shall ensure availability of funds through Re-appropriation or Supplementary Demands for Grants.

• 📤Departments shall surrender to the Finance Ministry, by the prescribed dates, all anticipated savings noticed in the Grants or Appropriations controlled by them.
• ⏰Funds provided during the financial year and not utilised before the close of that financial year shall stand lapsed at the close of the year.

• ⚡Savings shall be surrendered immediately when foreseen — without waiting till the end of the year.
• ⛔No savings shall be held in reserve for possible future excesses.

• 📊The Financial Advisers of Ministries/Departments shall ensure adherence to the Quarterly Expenditure Plan and guidelines issued by Ministry of Finance from time to time.

• ⛔No expenditure shall be incurred during a financial year on a "New Service" not contemplated in the Annual Budget for the year — except after obtaining a Supplementary Grant or Appropriation or an advance from the Contingency Fund during that year.

• 👤A subordinate authority incurring expenditure is responsible for ensuring the allotment at its disposal is not exceeded.
• ✅Where any excess is apprehended, the subordinate authority shall obtain additional allotment before incurring the excess expenditure.
• 📒For this purpose, authorities incurring expenditure shall maintain a Liability Register in Form GFR 3.

• ⛔A Disbursing Officer may not, on his own authority, authorise any payment in excess of the funds placed at his disposal.
• 🔄If faced with a claim certain to produce an excess, he shall take the orders of the administrative authority to which he is subordinate, who shall then arrange — Re-appropriation, or Supplementary Grant/Appropriation, or advance from the Contingency Fund.

• 🔄Re-appropriation of funds from one primary unit of appropriation to another within a grant or appropriation may be sanctioned by a competent authority at any time before the close of the financial year — subject to DFPR Rule 10 and restrictions imposed by Finance Ministry.
• 📌The primary unit = final unit of appropriation = Object Head of Account.

• ✅Re-appropriation shall be made only when it is known or anticipated that the appropriation for the unit from which funds are transferred shall not be utilised in full.

• ⛔Funds shall not be re-appropriated with the intention of restoring the diverted appropriation when savings become available under other units later in the year. No manipulation allowed.

• 📋Application for re-appropriation ordinarily supported by a statement in Form GFR 1.
• 📝In all orders sanctioning re-appropriation, reasons for saving and excess of ₹1 lakh or over and the primary units affected shall be invariably stated. ❗ ₹1 lakh threshold
• 📬The authority sanctioning the re-appropriation shall endorse a copy of the order to the Accounts Officer.

• 🏛️If savings are not available within the Grant to which the payment is required to be debited, or if the expenditure is on a "New Service" or "New Instrument of Service" not provided in the budget, a necessary Supplementary Grant or Appropriation in accordance with Article 115(1) of the Constitution shall be obtained before payment is authorised.

• ⚡When a need arises to incur unforeseen expenditure in excess of the sanctioned grant or appropriation, or on a New Service not provided in Budget, and there is not sufficient time for voting of Supplementary Demand before close of the financial year — an advance from the Contingency Fund set up under Article 267(1) of the Constitution shall be obtained before incurring the expenditure.

• 📋An advance from the Contingency Fund shall also be obtained to meet expenditure in excess of the provisions for the service included in an Appropriation (Vote on Account) Act.

• 📜The procedure for obtaining an advance and recoupment of the Fund shall be as laid down in the Contingency Fund of India (Amendment) Rules, 2021 (placed at Appendix-6).

• 💰Subject to the provisions of Article 114(3) of the Constitution, money indisputably payable by Government shall not ordinarily be left unpaid.
• 📋Suitable provision for anticipated liabilities shall invariably be made in Demands for Grants to be placed before Parliament.

• 📎For easy reference, an extract relating to the procedures followed in the Accounts Office for check against provision of funds as a part of pre-check of bills has been placed at Appendix 10.

The Secretary of a Ministry/Department, who is the Chief Accounting Authority (CAA), shall be responsible for all of the following nine duties:

• 1️⃣Financial Management: Be responsible and accountable for the financial management of his Ministry or Department.
• 2️⃣Proper Use of Funds: Ensure that public funds appropriated to the Ministry/Department are used for the purpose for which they were meant.
• 3️⃣Effective, Efficient, Economical and Transparent Use: Be responsible for such use of resources in achieving the stated project objectives, whilst complying with performance standards.
• 4️⃣Parliament: Appear before the Committee on Public Accounts (PAC) and any other Parliamentary Committee for examination.
• 5️⃣Performance Monitoring: Review and monitor regularly the performance of programmes and projects assigned to his Ministry to determine whether stated objectives are achieved.
• 6️⃣Expenditure Statements: Be responsible for preparation of expenditure and other statements relating to his Ministry/Department as required by regulations, guidelines or directives issued by MoF.
• 7️⃣Internal Controls: Ensure that his Ministry/Department maintains full and proper records of financial transactions and adopts systems and procedures that shall at all times afford internal controls.
• 8️⃣Procurement Procedures: Ensure that his Ministry/Department follows Government procurement procedure for execution of works, services and supplies, and implements it in a fair, equitable, transparent, competitive and cost-effective manner.
• 9️⃣Collections and Avoiding Waste: Take effective steps to ensure his Ministry/Department: (a) collects all moneys due to the Government; and (b) avoids unauthorised, irregular and wasteful expenditure.

• 📒Accounts of the Union Government shall be prepared every year showing receipts and disbursements, surplus or deficit, and changes in Government liabilities and assets.
• 🏛️Accounts shall be prepared by the Controller General of Accounts (CGA), certified by the Comptroller and Auditor General of India (CAG), and submitted to the President of India preferably within six months of close of the Financial Year. ❗ 6 months
• 📜The President shall cause them to be laid before each House of Parliament.

• ⚖️By virtue of Article 150 of the Constitution, the accounts of the Union Government shall be kept in such form as the President may, on the advice of the CAG, prescribe.
• 🏛️The Controller General of Accounts (CGA), Ministry of Finance (DoE) is responsible for prescribing the form of accounts of the Union and States, and to frame or revise rules and manuals relating thereto on behalf of the President — on the advice of the CAG.

• 📋Main principles for maintenance of Government accounts are contained in:
  • 📌Government Accounting Rules, 1990
  • 📌Accounting Rules for Treasuries
  • 📌Account Code Volume-III
• 📌Detailed rules for technical departments (Posts, etc.) are in their respective Accounts Manuals or departmental regulations.

• 💰Government accounts shall be prepared on cash basis.
• 📌Transactions in Government accounts shall represent actual cash receipts and disbursements during a financial year — as distinguished from amounts due to or by Government during the same period.
• ✅Exception: such book adjustments as may be authorised by Government Accounting Rules 1990 or by general/special order of the Central Government on the advice of the CAG.

• 📅The annual accounts of the Central Government shall record transactions which take place during a financial year running from 1st April to 31st March.

• 💱The accounts of Government shall be maintained in Indian Rupees.
• 🔄All foreign currency transactions and foreign aid shall be brought into account after conversion into Indian Rupees.

• 📌Classification shall have closer reference to functions, programmes and activities of the Government and the object of revenue or expenditure, rather than the department where it occurs.

• 🏛️New Major/Minor Heads — authorised by CGA (MoF, DoE) on the advice of the CAG under Art.150 powers.
• 📋Sub-Heads and Detailed Heads — opened by Ministries/Departments in consultation with the Budget Division, MoF. Principal Accounts Offices may open Sub/Detailed Heads under Minor Heads falling within the Public Account.
• 📌Object Heads — prescribed under DFPR Rule 8. Power to amend/modify or open new Object Heads rests with DoE, MoF on the advice of the CAG.

• 📌Budget Heads exhibited in estimates of receipts and expenditure framed by the Government, or in any appropriation order, shall conform to the prescribed rules of classification.

• 👤Every officer responsible for the collection of Government dues or expenditure of Government money shall see that proper accounts are maintained in the prescribed form, and tender accurately and promptly all accounts and returns as may be required by Government, Controlling Officer or Accounts Officer.

• 📋Drawing Officers shall record suitable classification on all bills drawn by them.
• 📋Departmental Officers responsible for collection shall indicate or record classification on challans crediting Government money into the Bank.
• ❓In cases of doubt regarding the correct Head, the matter shall be referred to the Principal Accounts Officer → CGA/MoF for clarification.

• ⚖️Expenditure covered under Article 112(3) of the Constitution is Charged on the Consolidated Fund and is not subject to vote by the legislature.
• 📌All other expenditure met out of the Consolidated Fund is treated as Voted expenditure.
• 📋Charged or Voted expenditure shall be shown separately both in the accounts and in the Budget documents.

• 🏗️Capital Expenditure: Significant expenditure incurred with the object of acquiring tangible assets of a permanent nature (for use in the organisation and not for sale) or enhancing the utility of existing assets.
• 🔧Revenue Expenditure: Subsequent charges on maintenance, repair, upkeep and working expenses required to maintain assets in running order + all expenses for day-to-day running of the organisation including establishment and administrative expenses.
• 📋Capital and Revenue expenditure shall be shown separately in the Accounts.

• 🏦The Reserve Bank of India (RBI) shall be the banker to the Government. It shall maintain cash balance of the Government and provide banking facilities either directly through its own offices or through its agent banks.
• 📌RBI, in consultation with the CGA, shall nominate a bank to function as the Accredited Bank of a Ministry or Department.
• 💳Pay & Accounts Offices and Cheque Drawing and Disbursing Officers (CDDOs) shall have assignment accounts with the identified branches of the Accredited Bank. All payments shall be made through these branches.
• 💰Tax revenues of the Government shall be collected by the RBI through its own offices or through nominated branches of its agent banks.

• 🎯Sub-rule (1): Transfer of benefits shall be done directly to beneficiaries using Information and Communication Technology (ICT). Process reengineering to minimise intermediary levels, reduce delays, and minimise pilferage and duplication.
• 📦Sub-rule (2): DBT includes in-kind and cash transfers to beneficiaries, as well as transfers/honorariums given to community workers and other enablers of Government schemes.
• 🔄Sub-rule (3): Three routes for cash benefits:
  • 📌(a) Directly from Ministries/Departments to beneficiaries
  • 📌(b) Through State Treasury Account
  • 📌(c) Through any Implementing Agency as appointed by Central/State Governments
• 📦Sub-rule (4): In-kind transfers to individual beneficiary/household/service provider — includes schemes where in-kind benefits are given by Government or through any Implementing Agency.
• 💻Sub-rules (5) & (6): Ministries/Departments shall use PFMS platform for processing of DBT payments. Implementing Agencies shall generate Electronic Utilisation Certificates (E-UCs) on PFMS portal online — to certify that money was actually utilised for the purpose sanctioned, eliminating the need for physical UCs.
• 💰Sub-rule (7): Transaction charges for financial intermediaries facilitating DBT payments shall be paid as stipulated by Ministry of Finance.

• 📋Appropriation Accounts of Central Ministries (except Railways) and Civil Departments (except Posts and Defence) shall be prepared by the Principal Accounts Officers of the respective Ministries/Departments (under guidance and supervision of CGA) and signed by the Chief Accounting Authority (Secretary).
• 📒Union Government Appropriation Accounts (Civil) submitted to Parliament shall be prepared by the CGA by consolidating the aforesaid Appropriation Accounts.
• 📌Special cases:
  • 📌Department of Posts: Prepared and signed by the Secretary, Dept of Posts
  • 📌Defence Services: Prepared and signed by the Secretary, Ministry of Defence
  • 📌Ministry of Railways: Signed by the Chairman, Railway Board

• 📒Annual accounts of the Government of India — including transactions of Posts, Defence, Railways, and UT Governments under the Public Account — showing annual receipts, disbursements and statement of balances, are called Finance Accounts.
• ✍️Finance Accounts shall be prepared and signed by the CGA and countersigned by the Secretary (Expenditure), Ministry of Finance.

• 📅Appropriation and Finance Accounts shall be prepared on dates mutually agreed upon with the CAG, in forms prescribed by the President on the advice of the CAG, and sent to the CAG for recording his/her certificate.
• 📜The certified Annual Accounts and Reports shall be submitted by the CAG to the President in accordance with Section 11 of the CAG (Duties, Powers and Conditions of Service) Act, 1971 and Article 151(1) of the Constitution.

• 📢Administrative Ministries / PSUs / Subordinate / Statutory / Autonomous Bodies may have financial stakes in PPP / Production Sharing Contracts (PSCs) / Joint Ventures (JVs) / Subsidiary companies. Details of such financial stakes shall be disclosed in the Annual Report of the Administrative Ministry.

• 🏭Where operations of certain Government Departments working on a commercial or quasi-commercial basis (e.g., industrial factory or store) cannot be suitably brought within the cash-based accounting system, the Head of the unit shall maintain subsidiary proforma accounts in commercial form, as agreed between Government and CAG.
• 📒This includes maintenance of Manufacturing, Trading, Profit & Loss Accounts and Balance Sheet.

• 📋R.93: Methods and principles for proforma accounts shall be regulated by orders and instructions issued by Government in each case. Regular Workshops/Factories follow departmental regulations; Public Works proforma accounts prepared by Accounts Officers per Account Code for Accountants General.
• ✅R.94: Where commercial accounts are maintained for cost assessment, the Head of the unit shall ensure that adequate regulations are framed with Government approval to ensure the cost deduced is accurate and true.
• 📅R.95: Such accounts and statements shall be submitted to the Accounts Officer on such date as required and shall be appended to the Appropriation Accounts of each year.

• 🏦A Personal Deposit (PD) Account is a device to facilitate the Designated Officer to credit receipts into and effect withdrawals directly from the account, subject to an overall check by the bank.
• ⛔The Designated Officer shall ensure that no withdrawal will result in a minus balance.
• 👤Only Government officers acting in their official or any other capacity shall be the Designated Officer.

• 🏛️Sub-rule (1): Authorised to be opened by a special order of the concerned Ministry/Department in consultation with the CGA. Every PD Account shall form part of the Government Account and be located in the Public Account.

• 🏗️Capital expenditure = significant expenditure to acquire tangible assets of a permanent nature (not for sale) or to enhance the utility of existing assets. Revenue expenditure = maintenance, repair, upkeep, working expenses and establishment/administrative costs.
• ⛔Temporary assets and grants-in-aid cannot ordinarily be classified as Capital expenditure unless specifically authorised by the President on the advice of the CAG.
• 💰Capital expenditure is generally met from capital receipts (as distinguished from ordinary revenues from taxes, duties, fees, fines). However, it is open to Government to meet capital expenditure from ordinary revenues if sufficient revenue resources are available.
• 📋Expenditure of a capital nature shall not be classed as Capital expenditure in Government Accounts unless the classification has been expressly authorised by general or special orders of Government. Must be distinguished from Revenue expenditure in both Budget Estimates and Accounts.

• 📋For Capital schemes where separate Capital and Revenue Accounts are kept, allocation shall be determined in accordance with Govt orders prescribed after consultation with the CAG.

• 📌Capital receipts relating to expenditure previously debited to Capital, accruing during the process of construction, shall be utilised in reduction of capital expenditure. Thereafter they shall not be credited to the revenue account except under special rule or order of Government.

• 📌Receipts and recoveries on Capital Account in so far as they represent recoveries of expenditure previously debited to a Capital Major Head shall be taken in reduction of expenditure under that Major Head — except where rules of allocation for a particular department require them to be taken to Revenue.

• 🔄Where loans outstanding against PSUs are proposed to be converted into equity investments or grants-in-aid, approval of Parliament shall be obtained by including a token provision in the relevant DFG or Supplementary DFG.
• 📒After obtaining Parliamentary approval, the balances under loans and progressive expenditure shall be corrected proforma in the relevant Accounts under the Loan/Capital Major Heads concerned.

• 💰Interest at rates specified by Government from time to time shall be charged in the accounts of all Commercial Departments or units for which separate capital and revenue accounts are maintained within Government accounts.

• 🏦Sub-rule (1) — Specific Loans: For capital outlay met from specific loans raised by Government, interest shall be charged at a rate prescribed by Government, having regard to the rate of interest actually paid on such loans and incidental charges. Specific loans = loans raised in the open market for one specific purpose clearly specified in the prospectus.
• 💰Sub-rule (2) — Other Capital Outlay: For capital outlay provided otherwise, interest shall be charged at a rate determined each year by the Department of Economic Affairs, MoF.

• 📐Interest shall be calculated on the direct capital outlay at the end of the previous year + half the outlay of the current year itself — irrespective of whether such outlay has been met from current revenues or from other sources.

• 📌When charges for interest during the process of construction are temporarily met from capital, the writing back of capitalised interest shall form the first charge on any capital receipts or surplus revenue derived from the project when opened for working.

• 📌Adjustments with State Governments shall be made as mutually agreed between the Central and State Government concerned, unless otherwise provided by the Constitution or law.
• 📋Seven specific matters are regulated by Appendix-5 to the Government Accounting Rules, 1990 (binding on all State Governments):
  • 1️⃣Pay and Allowances (other than Leave Salaries)
  • 2️⃣Leave Salaries
  • 3️⃣Pensions
  • 4️⃣Expenditure involved in Audit and keeping Accounts
  • 5️⃣Cost of Police functions on Railways including cost of protecting Railway Bridges
  • 6️⃣Cost of Forest Surveys by Survey of India and Forest maps prepared by that Department
  • 7️⃣Leave Salary and Pension Contributions recovered in respect of Government servants lent on Foreign Service

• 📅As a convention, a period of three years has been accepted by Central and State Governments for the re-audit of past transactions involving errors in classification. ❗ 3 years

• 📌Adjustment shall always be made unless otherwise agreed upon, if:
  • (a)A commercial department or undertaking or a regularly organised store department is concerned, or
  • (b)Under the operation of any rule or order, an adjustment would have been made if the particular transaction with State Government were a transaction between two departments of the Central Government

• 📌The Central Government (including Union Territories) and the State Governments have agreed under reciprocal arrangements not to prefer petty and isolated claims for an amount not exceeding ₹10,000 against one another. ❗ ₹10,000

• 📌For a claim to be covered by the reciprocal arrangement, it must be:
  • ✅Both petty AND of an occasional character
  • ✅Cover services rendered — not supplies (unless the latter forms part of the service)
• ⛔Claims relating to Commercial undertakings (Railways, Posts, Electrical undertakings, etc.) shall fall outside the purview and continue to be settled as hitherto.
• 📅Arrangement remains in force without any time limit in respect of all State Governments.

• 🏗️Where expenditure is to be shared by several participating Governments in agreed proportions but incurred ab-initio by one Government, recoveries from other Governments shall be exhibited as abatement of charges under the relevant expenditure Head of Account in the books of the Government incurring the expenditure initially.

• 📋R.114: Claims of State Governments for extra cost of agency functions under Article 258 shall be dealt with and settled in accordance with such directions as may be issued by the President.
• 🏭R.115 — Key principles:
  • 📌State Commercial Department engaged → may charge its normal commercial costs
  • 📌PWD agency costs → percentage charges on cost of Central Works as agreed between Centre and State
  • 📌Charges per item ≤ ₹50,000 per annum → offer 5-year contract at fixed sum per annum (reviewed every 5 years) ❗ ₹50,000 / 5-year
  • 📌Charges per item > ₹50,000 → annual statement of proposed charges required at budget time (contract system may still be adopted if charges are obviously static)
  • 📌Arbitration in exceptional cases → arranged by MoF · MoF to be consulted on all Art.258(3) matters
• 🔄R.116 — Procedure for transactions:
  • 📌Extra staff/contingency cost (e.g., Census administration): provided in State Budget first; reimbursed in lumpsum by Centre under distinct sub-head "Amounts paid to other Governments, Departments, etc."
  • 📌Work entrusted to State (e.g., National Highways, Defence Works): expenditure adjusted direct in Central accounts under relevant Head · adjusted under Head 8658 — Suspense Accounts — PAO Suspense in State accounts pending eventual clearance

• 📅Inter-Governmental adjustments can be carried out up to the 10th of April (or the date specified by CGA in consultation with RBI from time to time) — which is the date on which the books of the Reserve Bank are closed for the month of March. ❗ 10th April
• 📌Every endeavour must be made to settle all transactions with State Governments before the close of the year.

• 🌐Unless exempted by Government by general or special orders, services shall not be rendered to any foreign Government or non-Government body or institution or to a separate fund except on payment.

• 📌Recoveries of expenditure for services rendered or supplies made to non-Government parties or other Governments (including local funds and Governments outside India) shall, in all cases, be classified as receipts of the Government rendering such services.

• 📌When a Government undertakes a service merely as an agent of a private body, the entire cost of the service shall be recovered from that body so that the net cost to Government is nil.
• 📌The recoveries shall be taken as reduction of expenditure.

• 📌Any relief in respect of payment for services rendered or supplies made to any outside body or fund shall ordinarily be given through a grant-in-aid rather than by remission of dues.

• 🌍Maintenance: Half the maintenance charges shall be borne by the Central Government; the other half recovered from the foreign country. If recovery fails, the foreign country's share shall also be borne by the Central Government.
• 📋Demarcation and Disputes: Charges relating to demarcation of boundaries and boundary disputes shall be borne by the Central Government under Entry 10 of the Union List, subject to such recovery as shall be made from the foreign country.
• 💧Watercourse boundaries (median line principle): Each Government bears the cost of maintenance of the boundary line and survey marks on its own side.
• 📌Exceptions: Application to Nepal — subject to special arrangements worked out in consultation with Nepal Government. Bhutan's share for maintenance, demarcation and disputes shall be borne by the Central Government for the present.

• ⛔A Service Department shall NOT charge other Departments for services rendered or supplies made which fall within the class of duties for which it is constituted.
• ✅A Commercial Department or undertaking shall ordinarily charge and be charged for any supplies made and services rendered to, or by, other departments of Government.

• 📅All claims shall ordinarily be preferred between Departments within the same financial year and not beyond three years from the date of transaction. This limitation may be waived in specific cases by mutual agreement. ❗ 3 years

• 📋Settlement of inter-departmental adjustments shall be regulated by the directions contained in Chapter 4 of Government Accounting Rules, 1990.

• 📅Inter-departmental and other adjustments are to be made in the accounts of the current year, not the past year, if they could not have been reasonably anticipated in time for funds to be obtained from the proper authority.
• 📌For recurring or fixed-character payments to another Government or department, the Accounts Officer will automatically make the adjustment before the accounts are finally closed.
• ⚖️The onus of proving that adjustments could not have been reasonably anticipated shall lie with the Controlling Officer.
• 📌Classification of recoveries between departments of the same Government:
  • 📌Recoveries by a Service Department for services rendered to another Dept = deduction from gross expenditure
  • 📌Recoveries by a Commercial Department (Railways, Posts, etc.) for its constituted functions = receipts of that Department
  • 📌Commercial Dept acting as agent for functions not germane to its essential purpose = reduction of expenditure
  • 📌Exception: Recoveries of fees for purchase, inspection, etc. by Central Purchase Organisations of GoI = treated as receipts of the Department concerned
• 📋Recoveries classified as deduction from gross expenditure shall be shown in the relevant DFG as "below the line" recovery under the appropriate Major Head. Recovery actually effected shall be adjusted in the schedule of recovery attached to the Appropriation Account of the year in which recovery is effected.

• 💰With proforma commercial accounts: Pensionary liability of commercial departments and undertakings shall be assessed on a contribution basis at rates fixed by Government from time to time.
• 💰Without proforma commercial accounts (but allowed to charge for products/services): Pensionary liability shall be taken into account in overhead charges and manufacturing costs for calculating the issue price of goods or fees for services rendered, at rates prescribed by Government.
• 📌Note: The Railways, Posts and Defence Departments are regarded as separate Governments for the purpose of adjustment of pensionary charges.

• 📐In the case of Government Departments and Undertakings declared as commercial, adjustment of pensionary liability shall be made in the regular accounts by charging the average of the percentage for the 15th year of service, based on the rates of monthly contribution of pension as prescribed in the appropriate order issued from time to time under Appendix-II of Fundamental and Supplementary Rules.

• 🏗️Original works means all:

• 📌New constructions
• 📌Site preparation
• 📌Additions and alterations to existing works
• 📌Special repairs to newly purchased or previously abandoned buildings or structures, including remodelling or replacement

• 🔧Minor works mean works which add capital value to existing assets but do not create new assets.

• 🛠️Repair works means works undertaken to maintain buildings and fixtures.
• 📋Works shall also include services or goods incidental or consequential to the original or repair works.

Administrative control of works includes all three of the following:

• 1️⃣Assumption of full responsibility for construction, maintenance and upkeep.
• 2️⃣Proper utilisation of buildings and allied works.
• 3️⃣Provision of funds for execution of these functions.

• 📋The powers delegated to various subordinate authorities to:
  • 📌Accord administrative approval
  • 📌Sanction expenditure
  • 📌Re-appropriate funds for works
• 📜…are regulated by the Delegation of Financial Powers Rules (DFPR) and other orders contained in the respective departmental regulations.

• 🏛️A Ministry or Department may, at its discretion, directly execute repair works estimated to cost up to ₹60 Lakhs, after following the procedure indicated in Rules 139, 159 & 160. ❗ ₹60 lakh threshold

• 🏗️A Ministry or Department may assign:
  • 📌Repair works estimated to cost above ₹60 Lakhs, and
  • 📌Original/minor works of any value
  …to any Public Works Organisation (PWO) such as:

• 🏢CPWD (Central Public Works Department)
• 🏢State Public Works Departments
• 🏢Other Central Govt. organisations authorised for civil/electrical works — MES (Military Engineering Service), BRO (Border Roads Organisation), etc.
• 🏢Construction wings of Railways, Defence, Environment & Forests, Information & Broadcasting, Posts, Space, etc.

• 🏭As an alternative to Rule 133(2), a Ministry/Department may award repair works above ₹60 lakh and original works of any value to:
  • 📌(i) Any Public Sector Undertaking set up by the Central or State Government to carry out civil or electrical works, or
  • 📌(ii) Any other Central/State Govt. organisation/PSU notified by MoHUA (Ministry of Housing and Urban Affairs) after evaluating their financial strength and technical competence.
• ⚖️For award under this sub-rule, the Ministry/Department shall ensure competition among such PSUs/Organisations — essentially on lump sum service charges to be claimed for execution.

• 🏛️Works not specifically allotted to any Ministry or Department shall be included in the Grants for Civil Works to be administered by the Central Public Works Department.
• ⛔No such work may be financed partly from departmental budget and partly from the budget for Civil Works — split funding is not permissible.

• 📋Subject to Rule 144, the initiation, authorisation and execution of works allotted to a Ministry or Department shall be regulated by detailed rules and orders in their departmental regulations and other special orders applicable to them.

• 👥A Ministry or Department shall put in place, as far as possible, empowered project teams for all large value projects.
• 🎯These teams should be tasked only with project execution and not given other operational duties. ⭐ Exam point — dedicated teams

No works shall be commenced or liability incurred in connection with it until all seven of the following conditions are satisfied:

• 1️⃣Administrative Approval obtained from the appropriate authority.
• 2️⃣Sanction to incur expenditure obtained from the competent authority.
• 3️⃣A properly detailed design has been sanctioned. While designing, principles of Life Cycle Cost may also be considered.
• 4️⃣Estimates containing detailed specifications and quantities have been prepared on the basis of the Schedule of Rates maintained by CPWD or other PWOs — and sanctioned.
• 5️⃣Funds to cover the charge during the year have been provided by competent authority.
• 6️⃣Tenders invited and processed in accordance with rules.
• 7️⃣A Work Order issued.

• 📝Any development of a project considered necessary while a work is in progress, which is not contingent on the execution of work as first sanctioned, shall have to be covered by a supplementary estimate.

• 📦For the purpose of approval and sanctions, a group of works which forms one project shall be considered as one work.
• ⛔The necessity for obtaining approval or sanction of a higher authority shall not be avoided merely because the cost of each particular work in the project is within the powers of approval or sanction of a lower authority.

• ✅Exception: This provision shall not apply in case of works of similar nature which are independent of each other.

• ⛔Any anticipated or actual savings from a sanctioned estimate for a definite project shall not, without special authority, be applied to carry out additional work not contemplated in the original project.

The broad procedure to be followed by a Ministry or Department for execution of works under its own arrangements:

• 1️⃣The detailed procedure shall be prescribed by departmental regulations framed in consultation with the Accounts Officer, generally based on the principles underlying the financial and accounting rules for similar works carried out by CPWD.
• 2️⃣Preparation of detailed design and estimates shall precede any sanction for works.
• 3️⃣No work shall be undertaken before issue of Administrative Approval and Expenditure Sanction by the competent authority on the basis of the estimates framed.
• 4️⃣Open tenders shall be called for works costing ₹10 lakh to ₹60 lakh. ⭐ ₹10L–₹60L → Open tender
• 5️⃣Limited tenders shall be called for works costing less than ₹10 lakhs. ⭐ <₹10L → Limited tender
• 6️⃣Execution of Contract Agreement or Award of work should be done before commencement of the work.
• 7️⃣Final payment for work shall be made only on the Personal Certificate of the Officer-in-charge of execution of the work, in the following format:

• 🏛️For works entrusted as per Rule 133(2) or 133(3), the Administrative Approval and Expenditure Sanction shall be accorded and funds allotted by the concerned Ministry/Department under these rules and in accordance with DFPR.
• 🏗️The Public Works Organisation or PSU to which work is allotted shall then execute the work under the rules and procedures prescribed in that organisation.
• 📋A Memorandum of Understanding (MoU) may be drawn with the Public Works Organisation or PSU for proper execution of work.

• 🏗️After a project costing ₹100 crore or above is approved, the Administrative Ministry or Department shall set up a Review Committee consisting of a representative each from:
  • 📌Administrative Ministry
  • 📌Finance (Internal Finance Wing)
  • 📌Executing Agency
• ⚖️The Review Committee shall have the powers to accept variation within 10% of the approved estimates. ❗ 10% variation limit

• 🏛️For works costing less than ₹100 crores, it shall be at the discretion of the Administrative Ministry/Department to set up a suitable mechanism for review and acceptance of variation within 10% of the approved estimates.

• 📋This chapter contains the general rules applicable to all Ministries or Departments regarding procurement of goods required for use in the public service.
• 📌Procuring departments may issue detailed instructions broadly in conformity with the general rules contained in this Chapter.

• ⛔Excluded: Books, publications, periodicals, etc. for a library.

• 🎯Every authority delegated with powers to procure goods shall have the responsibility and accountability to bring efficiency, economy, and transparency in public procurement and for fair and equitable treatment of suppliers and promotion of competition.

• 👤An authority which is competent to incur expenditure may sanction the purchase of goods required for use in public service in accordance with the Delegation of Financial Powers Rules (DFPR), following the general procedure in the rules below.

• 🪖Procurement of goods required on mobilisation and/or during the continuance of Military operations shall be regulated by any special rules and orders issued by the Government on this behalf from time to time.

• 📌Ministries or Departments have been delegated full powers to make their own arrangements for procurement of goods and services that are not available on GeM.
• 🛒Common use Goods and Services available on GeM are required to be procured mandatorily through GeM as per Rule 149.

• 🛒Government of India has established GeM (Government e-Marketplace) for common use Goods and Services. Procurement of Goods and Services by Ministries or Departments is mandatory for Goods or Services available on GeM.
• ✅Credentials of suppliers certified by GeM SPV. Procuring authorities certify reasonableness of rates.

• 📅Annual Procurement Plan of goods and services shall be projected on GeM portal within 30 days of Budget approval. ❗ 30 days
• ⛔A demand for goods shall not be divided into small quantities to make piecemeal purchases to avoid L-1 buying/bidding/reverse auction on GeM or to avoid the necessity of obtaining the sanction of higher authorities.
• 📊Government Buyers may ascertain reasonableness of prices using Business Analytics (BA) tools on GeM including Last Purchase Price on GeM and Department's own Last Purchase Price.
• 📋The monetary ceilings under (i)–(iii) above apply only for GeM purchases. For purchases outside GeM, relevant GFR rules shall apply.

• 📋Sub-rule (i): For goods and services not available on GeM, Head of Ministry/Department may register suppliers periodically following a fair, transparent and reasonable procedure with due publicity. Such registered suppliers should be boarded on GeM as and when the item gets listed.
• 🔍Sub-rule (ii): Before registration, credentials, manufacturing capability, quality control systems, past performance, after-sales service and financial background shall be carefully verified.
• 📅Sub-rule (iii): Registered for a fixed period of 1 to 3 years depending on nature of goods. At end of period, willing suppliers apply afresh for renewal. New suppliers may be considered at any time if they fulfil all conditions. ❗ 1–3 years
• 👁️Sub-rule (iv): Performance and conduct of every registered supplier shall be watched. Grounds for removal from approved list: failure to supply on time · supply of substandard goods · false declaration to any Government agency · any ground not in public interest.
• 🌐Sub-rule (v): List of registered suppliers shall be exhibited on the website of the Procuring Entity / their e-Procurement portals.

• ⛔Mandatory debarment [Sub-rule (i)]: A bidder shall be debarred if convicted of an offence under:
  • 📌The Prevention of Corruption Act, 1988; or
  • 📌The Bharatiya Nyaya Sanhita or any other law for causing any loss of life or property or threat to public health as part of execution of a public procurement contract
• 📅Sub-rule (ii): A mandatorily debarred bidder or any successor shall not be eligible for any procuring entity for a period not exceeding three years from the date of debarment. DoE shall maintain the list, displayed on the Central Public Procurement Portal. ❗ Up to 3 years — DoE/CPPP
• 📅Sub-rule (iii) — Discretionary debarment: A procuring entity may debar a bidder (or successors) from its own procurement processes for a period not exceeding two years if it determines the bidder has breached the code of integrity. Ministry/Department shall maintain the list, displayed on their website. ⚠️ Up to 2 years — Ministry/website
• ⚖️Sub-rule (iv): A bidder shall not be debarred unless given a reasonable opportunity to represent against such debarment.

• 🌐Ministries/Departments, if they so require, may enlist Indian agents who desire to quote directly on behalf of their foreign principals.

• 🧶Sub-rule (i) — Khadi and Handloom: All items of hand spun and hand-woven textiles (khadi goods) are reserved for exclusive purchase from KVIC. Of all textiles, at least 20% mandatory procurement from handloom origin from KVIC and/or Handloom Clusters (Co-operative Societies, SHG Federations, JLG, Producer Companies, Corporations, Weavers with Pehchan Cards). ❗ 20% handloom
• 🏭Sub-rule (ii) — MSME Policy: Ministry of MSME has notified procurement policy under Section 11 of the MSMED Act, 2006.
• 📋Sub-rule (iii) — Central Govt discretion: Central Government may, by notification, provide for mandatory procurement from any category of bidders or provide for preference to bidders on the grounds of promotion of locally manufactured goods or locally provided services.

• 📌When a certain item is not available on GeM portal, purchase of goods up to the value of ₹50,000 on each occasion may be made without inviting quotations or bids, on the basis of a certificate to be recorded by the competent authority. ❗ ≤₹50,000

• 📌When a certain item is not available on GeM portal, purchase of goods costing above ₹50,000 and up to ₹5,00,000 on each occasion may be made on the recommendations of a duly constituted Local Purchase Committee of 3 members at an appropriate level as decided by the Head of the Department. ❗ ₹50,000–₹5,00,000 · 3 members
• 🔍The committee will survey the market to ascertain reasonableness of rate, quality and specifications and identify the appropriate supplier.

• ⛔A demand for goods shall not be divided into small quantities to make piecemeal purchases to avoid the necessity of obtaining the sanction of higher authority required with reference to the estimated value of the total demand.

• 📌Except in cases covered under Rules 154 and 155, Ministries or Departments shall procure goods by following the standard method of obtaining bids in:

• 💻Sub-rule (i): It is mandatory for all Ministries/Departments, their attached and subordinate offices and Autonomous/Statutory Bodies to publish their tender enquiries, corrigenda thereon and details of bid awards on GeM-Central Public Procurement Portal (GeM-CPPP).
• 🔒Sub-rule (ii) — Exemption (National Security): Individual cases requiring confidentiality for reasons of national security may be exempted. Decision to exempt requires approval of Secretary of the Ministry/Department with FA concurrence (for Autonomous/Statutory Bodies: Head of Body + Head of Finance). Statistical information on exemptions (number of cases and value) shall be intimated to MoF/DoE on a Quarterly basis. ❗ Quarterly to DoE
• 📋Sub-rule (iii): Applies to all forms: tender enquiries, RFPs, Requests for EOIs, Notice for Pre-Qualification/Registration, or any other notice inviting bids — whether advertised, limited or single party.
• ✅Sub-rule (v) — Exempted: Procurements under Rule 154 (without quotation) and Rule 155 (purchase committee) are not required to comply with e-publishing.

• 💻Sub-rule (i): It is mandatory for Ministries/Departments to receive all bids through e-procurement portals in respect of all procurements.
• 📌Sub-rule (ii): Low-volume procurement Ministries or those carrying out procurements only for day-to-day office running may use the e-procurement solution developed by NIC. Others may use NIC or engage any other service provider following due process.
• 🔒Sub-rule (iv) — Exemption: Where national security and strategic considerations demand confidentiality, the Ministry/Department may exempt after seeking approval of the concerned Secretary with FA concurrence.
• 🌍Sub-rule (v): For tenders floated by Indian Missions Abroad, the Competent Authority to decide the tender may exempt from e-procurement.

• 📢Sub-rule (i): Invitation to tenders by advertisement shall be used for procurement of goods of estimated value of ₹50 lakhs and above. Advertisement to be given on GeM as well as GeM-CPPP. Own website must also publish advertised tender enquiries. ❗ ≥₹50 lakhs
• 📄Sub-rules (ii) & (iii): Complete bidding document to be posted on the organisation's website and on GeM-CPPP. Advertisement must give the complete web address for downloading bidding documents.
• 🌐Sub-rule (iv) — Global Tender Enquiry (GTE):
  • 📌(a) Where goods of required quality may not be available in India, Ministry may send copies of tender notice to Indian Embassies abroad and Foreign Embassies in India. In such cases, e-procurement as per Rule 160 may not be insisted.
  • ⛔(b) No GTE shall be invited for tenders up to ₹200 crore (or such limit as prescribed by DoE). For tenders below such limit, GTE in exceptional cases requires detailed justification and prior approval for relaxation from the Competent Authority specified by DoE. ❗ ₹200 crore GTE threshold
• 🆓Sub-rule (v): No cost may be charged for tender documents downloaded by bidders (to promote wider participation).
• 📅Sub-rule (vi) — Minimum bid submission time: Ordinarily at least 3 weeks from date of publication of tender notice or availability of bidding document for sale (whichever is later). Where bids also invited from abroad: minimum 4 weeks for both domestic and foreign bidders. ❗ 3 weeks / 4 weeks (if abroad)

• 📋Sub-rule (i): This method may be adopted when estimated value of goods to be procured is up to ₹50 lakhs. Bidding documents to be sent directly by speed post/registered post/courier/e-mail to firms on the list of registered suppliers. Number of supplier firms must be more than 3. Also published on GeM and GeM-CPPP. ❗ ≤₹50 lakhs · >3 firms
• ⛔Sub-rule (ii): Unsolicited bids shall not be accepted. However, Ministries/Departments should evolve a system by which interested firms can register and bid in the next round of tendering.
• 📌Sub-rule (iii) — LTE permitted even above ₹50 lakhs in three circumstances:
  • 📌(a) Urgency: Competent authority certifies demand is urgent; additional expenditure justified; nature of urgency and reasons why procurement could not be anticipated placed on record
  • 📌(b) Public interest: Sufficient reasons, recorded in writing by competent authority, that it will not be in public interest to procure through advertised tender
  • 📌(c) Known sources: Sources of supply are definitely known and possibility of fresh sources beyond those being tapped is remote
• ⏱️Sub-rule (iv): Sufficient time shall be allowed for submission of bids in LTE cases.

• 📦For purchasing high-value plant, machinery etc. of a complex and technical nature, bids may be obtained in two parts:
  • 1️⃣Technical bid — all technical details along with commercial terms and conditions
  • 2️⃣Financial bid — item-wise prices for the items mentioned in the technical bid
• ✉️Both sealed in separate covers duly super-scribed, both placed in a bigger sealed outer cover, also duly super-scribed.
• 📋Process: Technical bids opened first → evaluated by a competent committee or authority → financial bids of only technically acceptable offers are opened at the second stage after intimating them the date and time of financial bid opening → further evaluation and ranking → contract awarded.

• 📌Ministry/Department may use two-stage bidding if any of the following conditions apply:
  • 📌(a) Not feasible to formulate detailed specifications without receiving technical inputs from bidders
  • 📌(b) Subject matter is subject to rapid technological advances or market fluctuations
  • 📌(c) Contract is for research, experiment, study or development (except where it includes production of items in quantities sufficient to establish commercial viability or recover R&D costs)
  • 📌(d) Bidder expected to carry out a detailed survey/investigation and comprehensive risk, cost and obligation assessment

• ⛔In the case of advertised tender enquiry or limited tender enquiry, late bids (i.e., bids received after the specified date and time for receipt of bids) should not be considered.

• 📌Procurement from a single source may be resorted to in the following circumstances:
  • 1️⃣(i) It is in the knowledge of the user department that only a particular firm is the manufacturer of the required goods
  • 2️⃣(ii) In a case of emergency, the required goods are necessarily to be purchased from a particular source — reason to be recorded and approval of competent authority obtained
  • 3️⃣(iii) For standardisation of machinery or spare parts to be compatible to existing sets of equipment — on the advice of a competent technical expert and approved by the competent authority

• 💻Sub-rule (i): Electronic Reverse Auction means an online real-time purchasing technique where bidders present successively more favourable bids during a scheduled period of time, with automatic evaluation.
• 📌Sub-rule (ii) — Conditions: A procuring entity may use electronic reverse auction if:
  • 📌(a) It is feasible to formulate a detailed description of the subject matter
  • 📌(b) There is a competitive market of qualified bidders anticipated to participate — to ensure effective competition
  • 📌(c) Criteria for determining the successful bid are quantifiable and can be expressed in monetary terms
• 📋Sub-rule (iii) — Procedure: Solicit bids through an invitation published/communicated as per e-procurement provisions. The invitation shall include details relating to access and registration for the auction, opening and closing of the auction, and norms for conduct of the auction.

• 🔧Depending on cost and nature of goods, it may be necessary to enter into maintenance contract(s) of suitable period, either with the supplier of the goods or with any other competent firm.
• ⚠️Especially needed for sophisticated and costly equipment and machinery.
• 📅Equipment or machinery is maintained free of charge by the supplier during its warranty period or such other extended periods as the contract terms may provide. Paid maintenance shall commence only thereafter.

• 🔐Purpose: To safeguard against a bidder's withdrawing or altering its bid during the bid validity period in the case of advertised or limited tender enquiry.
• 💰Amount: Ordinarily 2% to 5% of the estimated value of goods to be procured. Amount to be determined and indicated in bidding documents. ❗ 2%–5%
• ✅Exempted from bid security: MSEs (as defined in MSME Procurement Policy) · Suppliers registered with Central Purchase Organisation or concerned Ministry/Department · Startups recognised by DPIIT
• 📋Acceptable forms: Insurance Surety Bonds · Account Payee Demand Draft · Fixed Deposit Receipt · Banker's Cheque · Bank Guarantee (including e-Bank Guarantee) from any Commercial Bank · Online payment in acceptable form
• 📅Bid security to remain valid for a period of 45 days beyond the final bid validity period. ❗ 45 days beyond bid validity
• 🔄Return of bid security: Unsuccessful bidders — returned at the earliest after expiry of final bid validity and latest on or before the 30th day after the award of the contract. ❗ 30th day after award
• 📌Two-packet/two-stage bidding: Bid securities of unsuccessful bidders at the first stage (technical evaluation) shall be returned within 30 days of declaration of first-stage result.
• 📋Alternative — Bid Securing Declaration: In place of bid security, Ministries/Departments may require bidders to sign a Bid Securing Declaration — accepting that if they withdraw/modify their bid during validity, or fail to sign the contract or submit performance security before the deadline, they will be suspended for the specified period from being eligible to submit bids for contracts with that entity.

• 🔐Purpose: To ensure due performance of the contract. Obtained from the successful bidder awarded the contract.
• 💰Amount: For procurement of Goods/Consultancy Services/Non-Consultancy Services: 3% to 5% of the value of the contract as specified in bid documents. ❗ 3%–5% (Goods/Consultancy/Non-Consultancy)
• 📌Note: Amount of Performance Security plus security deposit/retention money for procurement of Works will continue to be 3% to 10%.
• 📋Acceptable forms: Insurance Surety Bond · Account Payee Demand Draft · Fixed Deposit Receipt from a Commercial Bank · Bank Guarantee (including e-Bank Guarantee) from a Commercial Bank · Online payment in acceptable form
• 📅Performance Security should remain valid for a period of 60 days beyond the date of completion of all contractual obligations including warranty obligations. ❗ 60 days beyond completion + warranty
• 🔄Bid security shall be refunded to the successful bidder on receipt of Performance Security.

• 📌Ordinarily, payments for services rendered or supplies made should be released only after the services have been rendered or supplies made. However, advance payments may be made in the following types of cases:
  • 📌Advance demanded by firms holding maintenance contracts for servicing of Air-conditioners, computers, other costly equipment, etc.
  • 📌Advance demanded by firms against fabrication contracts, turn-key contracts, etc.

• ⚖️Ministries or Departments may relax these ceilings (including the 30% for private firms) in consultation with their Financial Advisers.
• 🔐While making any advance payment, adequate safeguards in the form of bank guarantee etc. shall be obtained from the firm.

• 📌Depending on the terms of delivery incorporated in a contract, part payment to the supplier may be released after it dispatches the goods from its premises in terms of the contract.

• 🎯All Government purchases should be made in a transparent, competitive and fair manner to secure best value for money and enable prospective bidders to formulate competitive bids with confidence.

• ⏱️(i) To reduce delay, appropriate time frame for each stage of procurement should be prescribed by the Ministry or Department.
• 📋(ii) To minimise time for decision-making and contract placement, every Ministry/Department, with the approval of the competent authority, may delegate appropriate purchasing powers to lower functionaries wherever necessary.
• 📅(iii) Ministries/Departments should ensure placement of contract within the original validity of the bids. Extension of bid validity must be discouraged and resorted to only in exceptional circumstances.

• ⚖️Sub-rule (1): No official of a procuring entity or a bidder shall act in contravention of the Code, which includes:

• 📢Sub-rule (1)(ii): Disclosure of conflict of interest is mandatory.
• 📢Sub-rule (1)(iii): Bidder must disclose any previous transgressions of sub-clause (i) with any entity in any country during the last 3 years, or of being debarred by any other procuring entity. ❗ 3-year lookback
• ⚖️Sub-rule (2): The procuring entity, after giving a reasonable opportunity of being heard, may take appropriate measures if it concludes that a bidder or prospective bidder has contravened the code of integrity.

• 🔄When it is decided, with the approval of the competent authority, to replace an existing old item with a new and better version, the department may trade the existing old item while purchasing the new one.
• 📋A suitable clause shall be incorporated in the bidding document so that prospective bidders can formulate their bids accordingly. The time and mode of handing over the old item to the successful bidder shall be decided based on its value and condition.
• 📌The bidding document should also provide suitable provision to enable the purchaser to either trade or not trade the item while purchasing the new one (option kept open).

• 📋R.178: Ministries/Departments may hire external professionals, consultancy firms or consultants for a specific job, which is well defined in terms of content and time frame for its completion.
• ✅R.180: Engagement of consultants may be resorted to in situations requiring high quality services for which the Ministry/Department does not have requisite expertise. Approval of the competent authority shall be obtained before engaging consultants.
• 📝R.181: Ministries/Departments should prepare in simple and concise language the requirement, objectives and scope of the assignment. Eligibility and prequalification criteria for consultants should also be identified at this stage.
• 💰R.182: Ministry/Department should estimate reasonable expenditure by ascertaining prevalent market conditions and consulting other organisations engaged in similar activities.

• 📋Sub-rule (i) — Estimated cost up to ₹50 lakhs: Preparation of a long list of potential consultants may be done on the basis of formal or informal enquiries from other Ministries/Departments, Chambers of Commerce & Industry, Association of consultancy firms, etc.
• 📢Sub-rule (ii) — Estimated cost above ₹50 lakhs: In addition to (i), an enquiry for seeking Expression of Interest (EOI) shall be published on GeM as well as GeM-CPPP (and own website). EOI should include: broad scope of work · inputs to be provided by Ministry · eligibility and prequalification criteria · consultant's past experience in similar work. Consultants may be asked for comments on objectives and scope. Adequate time shall be allowed. ❗ >₹50L — EOI on GeM-CPPP

• 📋On the basis of responses received as per Rule 183, consultants meeting requirements should be short-listed. Number of short-listed consultants should not be less than three. ❗ Minimum 3

• 📋RFP is the document used by the Ministry/Department for obtaining offers from consultants. Issued to short-listed consultants to seek their technical and financial proposals. RFP should contain:

• ✉️R.187 — Receipt and Opening: Proposals to be asked in Two-bid system — technical and financial bids sealed separately, both placed in a bigger sealed envelope. On receipt, technical proposals opened first at the specified date, time and place.
• ⛔R.188 — Late Bids: Not to be considered.
• 📊R.189 — Technical Evaluation: Technical bids analysed and evaluated by a Consultancy Evaluation Committee (CEC) constituted by the Ministry/Department. CEC shall record in detail the reasons for acceptance or rejection of technical proposals.
• 💰R.190 — Financial Evaluation: Financial bids opened only for bidders declared technically qualified by the CEC (per Rule 189) — for further analysis, evaluation, ranking and selection of the successful bidder.

• 📌The basis of selection of the consultant shall follow any of the methods given in Rules 192 to 194 as appropriate for the circumstances in each case.

• 🎯Used where quality of consultancy is of prime concern.
• 📊Step 1: Quality of technical proposals scored as per criteria announced in the RFP. Only responsive proposals achieving at least the minimum specified qualifying score in technical quality are considered further.
• 📊Step 2: Financial proposals of technically qualified bidders are opened and scored. A final combined score is arrived at by giving predefined relative weightages to technical score and financial score.
• 📋RFP shall specify the minimum qualifying score for technical quality and the relative weightages to be given to quality and cost (determined per case, e.g. 70:30, 60:40, 50:50). Proposal with the highest weighted combined score shall be selected.
• ⚠️The weightage of technical (non-financial) parameters shall in no case exceed 80%. ❗ Technical weight ≤80%

• 📌Appropriate for assignments of a standard or routine nature (such as audits and engineering design of non-complex works) where well-established methodologies, practices and standards exist.
• 💰Unlike QCBS, there is no weightage for technical score in the final evaluation. The responsive technically qualified proposal with the lowest evaluated cost shall be selected.

• 📌Selection by direct negotiation/nomination (on lines of Single Tender for goods) is appropriate only under exceptional circumstances:

• 👁️The Ministry/Department should be involved throughout in the conduct of consultancy, preferably by taking a task force approach and continuously monitoring the performance of the consultant(s) so that the output is in line with the Ministry/Department's objectives.

• 🎨Design competition shall be conducted in a transparent, fair and objective manner with wide publicity to ensure information is accessible to all possible participants.
• 🌐Publication on the Ministry/Department website as well as on GeM-CPPP is required. If selection is by a jury of experts nominated for the purpose, the composition of the jury may also be notified.

• 📌Non-Consulting Services involve physical, measurable deliverables/outcomes where performance standards can be clearly identified and consistently applied — other than goods or works (except those incidental to the service).
• 🔧Examples: Maintenance · Hiring of vehicles · Building facilities management · Security · Photocopier service · Janitor · Office errand services · Drilling · Aerial photography · Satellite imagery · Mapping

• 📋A Ministry or Department may procure certain non-consulting services in the interest of economy and efficiency and may prescribe detailed instructions and procedures for this purpose, without contravening the basic guidelines in Rules 198–206.

• 📋Ministry/Department should prepare a list of likely and potential contractors on the basis of formal or informal enquiries from other Ministries/Departments and organisations involved in similar activities, scrutiny of Yellow Pages, trade journals, websites, etc.

• 📋Ministry/Department should prepare a tender enquiry containing, inter alia:

• 📋Sub-rule (i) — Up to ₹50 lakhs: Scrutinise the preliminary list of contractors (Rule 199), decide prima facie eligible and capable contractors, and issue Limited Tender Enquiry to them. Number of contractors for LTE shall be more than three. ❗ >3 contractors
• 📢Sub-rule (ii) — Above ₹50 lakhs: Issue advertisement on GeM as well as GeM-CPPP (and own website). Advertisement must give complete web address for downloading bidding documents. ❗ >₹50L — GeM + GeM-CPPP

• ⛔Late bids (received after the specified date and time) shall not be considered.

• 📊The Ministry/Department should evaluate, segregate, rank the responsive bids and select the successful bidder for placement of the contract.

• 📌Should it become necessary in an exceptional situation to procure a non-consulting service from a specifically chosen contractor, the Competent Authority in the Ministry/Department may do so in consultation with the Financial Adviser.
• 📋In such cases, the detailed justification, circumstances leading to such procurement by choice, and the special interest or purpose it shall serve, shall form an integral part of the proposal.

• 👁️The Ministry/Department should be involved throughout in the conduct of the contract and continuously monitor the performance of the contractor.

• 📌Any circumstances not covered in Rules 198–205 for procurement of non-consulting services shall be governed by Rules 142 to 176 (pertaining to procurement of goods) and not the rules pertaining to procurement of consulting services.

• 📋This chapter contains the basic rules applicable to all Ministries or Departments regarding inventory management.
• 📝Detailed instructions and procedures relating to inventory management may be prescribed by various Ministries or Departments broadly in conformity with the basic rules contained in this chapter.

• 📜(i) The officer-in-charge of stores should refer to the relevant contract terms and follow the prescribed procedure for receiving materials.
• ⚖️(ii) All materials shall be counted, measured or weighed and subjected to visual inspection at the time of receipt to ensure:
  • ✅Quantities are correct
  • ✅Quality is according to required specifications
  • ✅No damage or deficiency in the materials
  Technical inspection where required should be carried out at this stage by Technical Inspector or Agency approved for the purpose.
• 📒(iii) Details of material received shall be entered in the appropriate stock register, preferably in an IT-based system. The officer-in-charge of stores should certify that he has actually received the material and recorded it in the appropriate stock registers.

• 📋(i) Receiving from internal divisions: The indenting officer shall project an indent in the prescribed form. On receipt, he shall examine, count, measure or weigh materials and provide an appropriate receipt to the sending division.
• ✍️(ii) Issue from stock for departmental use: The officer-in-charge of stores shall ensure an indent in the prescribed form has been projected. A written/online acknowledgement of receipt shall be obtained from the indenting officer or his authorised representative at the time of issue.
• 🏗️(iii) Issue to contractor (cost recoverable): All relevant particulars — including recovery rates and total value chargeable to the contractor — should be got acknowledged from the contractor, duly signed and dated. ❗ Exam point
• 📝(iv) Partial supply: If unable to comply with the indent in full, the officer-in-charge should make supply to the extent available and make a suitable entry in the indentor's copy of the indent. If alternatives are available, a suitable indication may be made in the document.

• 🔒The officer-in-charge of stores having custody of goods and materials — especially valuable and/or combustible articles — shall take appropriate steps for:
  • 📌Safe custody
  • 📌Proper storage accommodation
  • 📌Arrangements for maintaining required temperature, dust-free environment, etc.

• 📒(i) The officer-in-charge shall maintain suitable item-wise lists and accounts and prepare accurate returns in respect of goods and materials in his charge, making it possible at any point of time to check actual balances with book balances.

• 📋When a fixed asset is hired to local bodies, contractors or others, proper record should be kept of the assets.
• 💰Hire and other charges as determined under rules prescribed by the competent authority shall be recovered regularly.
• 📐Calculation of charges shall be based on the historical cost of the asset. ⭐ Historical cost basis

• 🏭The inventory for fixed assets shall ordinarily be maintained at site.
• 📅Fixed assets should be verified at least once in a year and the outcome of verification recorded in the corresponding register. ❗ Once a year
• 🔍Discrepancies, if any, shall be promptly investigated and brought to account.

• 📦A physical verification of all consumable goods and materials should be undertaken at least once in a year and discrepancies shall be recorded in the stock register for appropriate action by the competent authority.

• 1️⃣Verification shall always be made in the presence of the officer responsible for custody of the inventory being verified.
• 2️⃣A certificate of verification along with the findings shall be recorded in the stock register.
• 3️⃣Discrepancies including shortages, damages and unserviceable goods identified during verification shall immediately be brought to the notice of the competent authority for action in accordance with Rules 33 to 38 (Loss reporting and responsibility).

• 📊Depending on the frequency of requirement, quantity thereof, and pattern of supply of a consumable material, optimum buffer stock should be determined by the competent authority.

• ⚠️In case sample verification reveals unusual or unreasonable shortages, complete verification shall be done.

• 📊Loss of five volumes per one thousand volumes of books issued/consulted in a year may be taken as reasonable — provided such losses are not attributable to dishonesty or negligence. ⭐ 5 per 1,000 = reasonable
• 🔍However, loss of a book of value exceeding ₹1,000 and rare books irrespective of value shall invariably be investigated and appropriate action taken. ❗ ₹1,000 threshold

• 🔄In case of transfer of Officer-in-charge of the goods, materials, etc., the transferred officer shall see that the goods or materials are made over correctly to his successor.
• 📋A statement giving all relevant details of the goods/materials in question shall be prepared and signed with date by both the relieving officer and the relieved officer.
• 📄Each of these officers will retain a copy of the signed statement.

• 📋(i) An item may be declared surplus or obsolete or unserviceable if it is of no use to the Ministry or Department. Reasons for declaring the item surplus/obsolete/unserviceable should be recorded by the authority competent to purchase the item.
• 👥(ii) The competent authority may constitute a committee at appropriate level to declare items as surplus/obsolete/unserviceable.
• 💰(iii) The book value, guiding price and reserved price should be worked out before disposal. Where book value is not possible to work out, the original purchase price may be utilised. A report of stores for disposal shall be prepared in Form GFR-10.
• ⚖️(iv) If an item becomes unserviceable due to negligence, fraud or mischief on the part of a government servant, responsibility for the same should be fixed.
• ☠️(v) Hazardous waste/Scrap Batteries/E-waste: Scrap lots comprising hazardous waste, batteries, etc. shall be sold keeping in view the guidelines of the Ministry of Environment & Forest. Prospective bidders must hold valid registration as recycler/preprocessor agency on the date of e-Auction and delivery.

• 1️⃣Preparation of bidding documents
• 2️⃣Invitation of tender for the surplus goods to be sold
• 3️⃣Opening of bids
• 4️⃣Analysis and evaluation of bids received
• 5️⃣Selection of highest responsive bidder
• 6️⃣Collection of sale value from the selected bidder
• 7️⃣Issue of sale release order to the selected bidder
• 8️⃣Release of sold surplus goods to the selected bidder · Return of bid security to unsuccessful bidders

• 📣Transparency, competition, fairness, elimination of discretion are the basic principles. Wide publicity of the sale plan is mandatory.
• 🔍Bidding documents must indicate the location and present condition of goods so bidders can inspect before bidding.
• 💰Bid security = ordinarily 10% of the assessed or reserved price. The exact amount must be stated in the bidding document. ❗ 10% bid security
• 🏆Highest acceptable responsive bidder shall normally be accepted. Negotiation is permissible only with that bidder. If negotiation fails, the reasonable price may be counter-offered to the next highest responsive bidder(s).
• 📦If the total quantity cannot be taken by the highest acceptable bidder, the remaining quantity may be offered to the next higher bidder(s) at the price offered by the highest acceptable bidder.
• 💳Full payment (residual amount after adjusting bid security) shall be obtained from the successful bidder before releasing the goods.
• ⚠️Default by selected bidder: Bid security shall be forfeited and the goods re-sold at the risk and cost of the defaulter after obtaining legal advice.
• ⏰Late bids i.e. bids received after the specified date and time of receipt shall not be considered.

• 🔨A Ministry or Department may undertake auction of goods either directly or through approved auctioneers.
• 📣The basic principles are the same as for advertised tender — transparency, competition, fairness and elimination of discretion. The auction plan must be widely publicised.
• 🎤At the start of the auction, the condition and location of goods, terms and conditions of sale shall be announced again for the benefit of assembled bidders.
• 💰On acceptance of a bid, earnest money of not less than 25% of the bid value shall be taken immediately on the spot from the successful bidder — in cash or by Deposit-at-Call-Receipt (DACR) in favour of the Ministry/Department. ❗ 25% earnest money at auction
• 📦Goods shall be handed over to the successful bidder only after receiving the balance payment.
• 👥The composition of the auction team shall be decided by the competent authority. The team must include an officer of the Internal Finance Wing of the department. ⭐ IFW officer mandatory

• 🗑️If a Ministry or Department is unable to sell any surplus/obsolete/unserviceable item despite attempts through both advertised tender and auction, it may dispose of the same at its scrap value with the approval of the competent authority in consultation with Finance division.
• ♻️If unable to sell even at scrap value, it may adopt any other mode of disposal including destruction of the item in an eco-friendly manner.

• 📋A sale account should be prepared for goods disposed of in Form GFR-11, duly signed by the officer who supervised the sale or auction.

• 📋All profits and losses due to revaluation, stock-taking or other causes shall be duly recorded and adjusted where necessary.
• ⚠️Formal sanction of the competent authority shall be obtained in respect of losses, even though no formal correction or adjustment in Government accounts is involved.
• 📜Powers to write off losses are available under the Delegation of Financial Powers Rules (DFPR).

• ⚖️All contracts shall be made by an authority empowered to do so by or under the orders of the President in terms of Article 299(1) of the Constitution of India.

• 🏛️All contracts and assurances of property made in the exercise of the executive power of the Union shall be executed on behalf of the President.
• 📝The words "for and on behalf of the President of India" should follow the designation appended below the signature of the authorised officer. ❗ Exact wording required

• 📋The terms of contract must be precise, definite and without any ambiguities. The terms should not involve an uncertain or indefinite liability, except in the case of a cost plus contract or where there is a price variation clause.

• 📄Standard forms of contracts should be adopted wherever possible, with such modifications as are considered necessary for individual contracts. Modifications should be carried out only after obtaining financial and legal advice.

• ⚖️Where standard forms are not used, legal and financial advice should be taken in drafting the clauses.

• ⛔No work of any kind should be commenced without proper execution of an agreement as given in the foregoing provisions.

• ⛔Cost plus contracts should ordinarily be avoided. Where unavoidable, full justification shall be recorded before entering into the contract.
• 🔄Where such contracts continue over a long duration, efforts should be made to convert future contracts to a firm price basis after allowing a reasonable period for the supplier/contractor to stabilise their production/execution methods.

• 💰Contracts should include provision for payment of all applicable taxes by the contractor or supplier.

• ⛔Lump sum contracts should not be entered into except in cases of absolute necessity. Where unavoidable, full justification shall be recorded. The contracting authority should ensure adequate safeguards for Government interest.

• ⛔Departmental issue of materials should be avoided as far as possible. Where decided, a schedule of quantities with issue rates of such material should form an essential part of the contract.

• 🔒(a) Where Government property is entrusted to a contractor (for use on payment of hire charges or for further work on such property), the contract must include specific provision for:
  • 📌Safeguarding Government property (including insurance cover)
  • 📌Recovery of hire charges regularly
• 📋(b) Provision shall be made for periodical physical verification of the number and physical condition of the items at the contractor's premises. Results shall be recorded and penal action taken where necessary.

• ⛔(a) The terms of a contract — including the scope and specification — once entered into, should not be materially varied.
• 📋(b) Where material variation becomes unavoidable, the financial and other effects shall be examined, recorded and specific approval of the authority competent to approve the revised commitments shall be obtained before varying the conditions.
• ✍️(c) All such changes should be in the form of a formal amendment to the contract duly signed by all parties.

• 📅Normally no extensions of scheduled delivery or completion dates shall be granted except where Force Majeure events have occurred or the contract itself contains such a provision. Extensions shall be allowed through formal amendments to the contract duly signed by the parties.

• 🔧A warranty clause should be incorporated in every contract, requiring the supplier to — without charge — repair or rectify defective goods or replace such goods with similar goods free from defect. Any goods repaired or replaced shall be delivered at the buyer's premises without costs to the buyer.

• ⛔All contracts for supply of goods should reserve the right of Government to reject goods which do not conform to the specifications.

• 👀(i) Implementation of the contract should be strictly monitored and notices issued promptly whenever a breach of provisions occurs.
• 🏦(ii) Proper procedure for safe custody and monitoring of Bank Guarantees (BGs) or other instruments should be laid down. Monitoring should include:
  • 📅A monthly review of all BGs or other instruments expiring after three months, along with a review of the progress of supply or work. ❗ Monthly review of BGs expiring in 3 months
  • ⚡Extensions of BGs or other instruments, where warranted, should be sought immediately.

• ⚖️Wherever disputes arise during implementation of a contract, legal advice should be sought before:
  • 📌Initiating action to refer the dispute to conciliation and/or arbitration as provided in the contract, or
  • 📌Filing a suit where the contract does not include an arbitration clause.
• 📄The draft of the plaint for arbitration should be got vetted by obtaining legal and financial advice.
• 🔍Documents to be filed in resolution of disputes should be carefully scrutinised before filing to safeguard Government interest.

• ⚖️In cases where the Ministry/Department has challenged an arbitral award and the amount has therefore not been paid, 75% of the arbitral award (which may include interest up to date of the award) shall be paid by the Ministry/Department to the contractor/concessionaire against a Bank Guarantee. ❗ 75% against BG
• 📌The BG shall only be for the 75% of the arbitral award — not for the interest which may become payable to the Ministry/Department should a subsequent court order require refund of the said amount.

• 🏦The payment may be made into a designated Escrow Account with the stipulation that the proceeds will be used in the following priority order:
  • 1️⃣Payment of lenders' dues
  • 2️⃣Completion of the project
  • 3️⃣Completion of other projects of the same Ministry/Department as mutually agreed/decided
• ✅Any balance remaining after settlement of lenders' dues and project completion may be allowed to be used by the contractor/concessionaire with the prior approval of the lead banker and the Ministry/Department.
• 📋If otherwise eligible and subject to contractual provisions, retention money and other amounts withheld may also be released against Bank Guarantee.