GOVERNMENT OF INDIA

CENTRAL PUBLIC WORKS ACCOUNTS CODE

CHAPTER 1 – EXTENT OF APPLICATION

1. These rules describe the financial method and procedures to be observed PW Officer in
dealing with:
 Transaction relating to CP Works &
 In keeping & rendering accounts to Comp. Authority for final consolidation.

2. These rules are supplementary to the financial rules contained in:-

 CPWD Code
 DFPR, 1978
 R&P Rules 1983
 GAR, 1990
 GFR, 2005
 List of Major & Minor Heads
 Treasury Rules (In case of UT where treasury system of payment exists)

3. In case of dealing with initial & compiled accounts of PWD Officer, these rules are based on
Account Code Vol-III.

4. Applicability of rules to execution of Central Public Works:

 For Administrations under direct control of Union Govt: Wholly

 For MES & other Ministries of Union Govt: Not applicable (To be guided by
departmental regulations/ Spl Order of Govt.)

5. Execution of CP Works by an agency of State Govts is regulated by by rules made by the

State Government concerned (subject to directions in Acct Code Vol-III & exception of distinct
provisions made in this rules)

CHAPTER 2 – DEFINITIONS

(1) Accounts Officer – The Head of an Office of Accounts or the Head of a PAO set up under
the scheme of departmentalization of accounts.

(2) Audit Officer – means the Head of an office of Audit.

(3) Administrative Approval – The formal acceptance of proposal for incurring expenditure in
PW Deptt on a work taken up by the administrative department concerned.
It is, in effect, an order to the PW Department to execute certain specified works at a stated sum
to meet the administrative needs of the department requiring the work.

(4) Administrator –An Administrator of Union Territory, by whatever name designated.

(5) Advance Payment –A payment made on a running account to a contractor for work done by
him but not measured.

(6) Appropriation – The assignment of funds to meet specified expenditure included in a

primary unit of appropriation.

(7) Assets – In the accounts of works, it indicates all outstanding or anticipated CREDITS,
which have to be taken in reduction of final charges.

Examples: Recoveries of advances or recoverable payment, and sale proceeds or transfer value
of surplus materials.

(8) Bank – An accredited bank acting as the agent of the Reserve Bank of India in
accordance with the provisions of the Reserve Bank of India Act, 1934 (2 of 1934).

(9) Book Transfer – It is a process whereby following transactions which represents assets and
liabilities are taken into account by way of settlement or otherwise:

- The financial transactions which do not involve the giving or receiving of Cash, or of stock
materials.

- The corrections and amendments made in Cash, Stock, or Book Transfer transactions
previously taken to account.

(10) Charged Expenditure – The expenditure which is not subject to vote by Parliament as per
Article 112 (3) of the Constitution of India.

(11) Chief Accounting Authority – The Secretary of the Ministry.

(12) Chief Controller of Accounts –The Head of the Accounting Organisation of the
Ministry.

(13) Commercial Department –The Department which functions on commercial pattern.

(14) Competent Authority –The Government or any other authority to whom the relevant
power may be delegated by Government.

(15) Completion and Completed –

“completion of work” is to include “abandonment of a work”, and

“completed work” is to include “abandoned work”.

(16) Contingencies (Works) – “Contingencies” indicates the incidental expenses of a
miscellaneous character which cannot appropriately be classified under any distinct sub
head or subwork, yet pertain to work as a whole.

(17) Contract and Contractor – The term

“Contract” Any kind of undertaking, written or verbal, express or implied, by a person, not
being a Government servant, or by a syndicate or firm:-

- for the construction, maintenance or repairs of one or more works,

- for the supply of materials, or

- for the performance of any service related to execution of works or the supply of materials.

“Contractor” A person, syndicate or firm that has made such an undertaking for the execution
of works or for service in connection therewith.

(18) The Department – It is used to indicate the Public Works Department which also
includes the works organisation, if any, under an Administrator.

(19) Deposit Works – Those works of construction or repair, where the cost is met, not out of
Government Funds, but out of funds from non-Government sources.

Such cost may either be deposited in cash or otherwise placed at the disposal of the Divisional
Officer.

Example: Works executed for municipalities and other public bodies

(20) Detailed Head – means Sub-Scheme.

(21) Direct and Indirect Charges –

“Direct Charges” The charges incurred directly for execution of a work, project, or job, which
are incurred directly for its execution and are included in the regular accounts of it.

“Indirect Charges” The charges which pertain, or are incidental to a work, project, workshop
job or manufacture job, but which are not incurred directly or solely in connection therewith and
thus cannot be taken directly into such detailed accounts.

(22) Direction Office –The office of an administrative officer e.g DG(W), CE, SE or a Supdt of
Works:-

- who has one or more Divisional Officers working under his orders and

- is not himself entrusted with the execution of works or with the receipt and disbursement of
public money,
But if such an officer is also entrusted at any time with the receipt and disbursement of public
money, he is treated as a Divisional Officer

(23) Direction Officer – The Head of a Direction Office (The CE/SE is not a Direction Officer
unless direction of business of one or more divisions is entrusted to him. Thus SE employed on
Special duty is not a Direction Officer).

(24) Direct and Indirect Receipts –

“Direct Receipts” The receipts realized in connection with a work or project, either by officers
of the PW Department or other departments and are brought to account directly as appertaining
to the work or project.

“Indirect Receipts” The receipts which pertain or are incidental to scheme or work, but cannot
be taken directly into such detailed accounts.

(25) Division and Divisional Office – These terms denote respectively the executive charge held
by a Divisional Officer and the head office of such a charge.

Thus, the office of an independent executive Sub-division & Superintendent of a Workshop

working independently is a Divisional Office for the purposes of this Code.

(26) Divisional Officer –An executive officer of the PW Department who is not subordinate to
another executive or disbursing officer of the Department, even though the executive charge
held by him may not be recognized as a “Division”.

The term Division Officer also includes:

- The officer in charge of an independent sub-division.

- Disbursing Officer of other departments, (if they spend Public Works funds and are required
to render their accounts direct to the Pay & Accounts Officer.)

(27) Final Payment : The last payment on a running account made to a contractor on the
completion or determination of his contract and in full settlement of the account.

(28) Financial Adviser – The Adviser on Budget and Accounts matters including internal
Finance of the Ministry.

(28) Government: The Central (Union) Government or a UT Administration or Both.

(A State Government means the Government of the State specified in the First Schedule of the
Constitution.)

(29) Grant – The Provision of Funds approved by Parliament.

(30) Inclusive Rate of Cost –The rate of cost of the entire work relating to a sub-head,
including the cost of material, if recorded separately in Accounts (eg Works Abstract).
(48) Rate of Cost –The total cost of a work or supply divided by its quantity . In the accounts,
it represents the recorded cost per unit, as arrived at by dividing the up-to-date final charge
on a sub-head, by the up-to-date progress thereof.

(31) Intermediate Payment: A disbursement of any kind on a running account, not being the
final payment. It includes

- Advance Payment

- Secured advance

- on account payment (other than the final payment), or

- a combination of above.

(32) Issue Rate –

- The cost per unit fixed, in respect of an stock article for the purpose of calculating the amount
creditable to the sub-head concerned of stock account by charge (Debitable) to the account
or service concerned, when any quantity of that article is issued from Stock;

- Following charges are also included in Issue Rate on percentage basis based on carriage/ other
incidental charges of previous year:

- Handling Charges

- Storage Charges

This is fixed at the beginning of a year.

(33) Labour – (Paid on Muster Roll) when a separate materials account is kept for one or more
sub-heads of an estimate and the term “labour” is used in connection with such an account, it
denotes all charges pertaining to each of those sub-heads, other than

(1) the cost of materials issued direct, and

(2) carriage and incidental charges in connection with the materials.

(34) Liabilities –This term includes all anticipated charges which are adjustable as final
charges, but have not been paid, regardless of whether or not they have fallen due for payment,
or having fallen due, have or have not been placed to the credit of the persons concerned in a
suspense head subordinate to the account of the work concerned.

(35) Local Loan Works – The works executed by the PW Department on behalf of a
Municipality, Port Trust or other corporation, where the cost of the works is to form part of a
loan given to it by Government for the purpose.

(36) Major Estimate The estimate for a work where the sanctioned amount of the works
expenditure exceeds Rs. 50,00,000/-.
(37) Major Head (i.e Function) –The main unit of classification in accounts denoting function
e.g. 2059-Public Works, 2216-Housing etc.

(38) Market Rate – It is the cost per unit at which the article, or an article of similar
description, can be procured, at a given time from the public.

This cost should include:

- Carriage and incidental charges, and

- A reasonable provision for wastage and depreciation (if inevitable).

(39) Minor Estimate The estimate for a work, where the sanctioned amount of the works
expenditure does not exceed Rs. 50,00,000/-.

(40) Minor Head (Programme) – means the Programme.

(41) On Account Payment or Payment on Account –A payment made, on a running account,

to a contractor in respect of work done or supplies made and duly measured. Such payments
may or may not be for the full value of work or supplies;

(42) Operation (Manufacturing/ WKSP A/c) – It indicates the charges incurred on the
manufacture operations connected with specific jobs.(Term used for accounts of manufacture &
workshop transactions)

(43) Outturn (Manufacturing/ WKSP A/c) – It denotes the value of the finished products (or
of the work done, in cases in which the articles brought are not supplied departmentally) of
manufacture operations connected with specific jobs.

(44) Progress (Manufacturing/ WKSP A/c) - The up-to-date quantities of work done or
supplies made.

(45) Public Works – means civil works and Irrigation, Navigation, Embankment and Drainage
Works etc.

(46) Quantity (Normal Works) – It describe the extent of work done, supplies made or
services performed, when these can be measured, weighed or counted.

(47) Rate –It means the consideration allowed for each unit of work, supply or other service in
relation to estimate/cost/contract/contractor bills/ vouchers.

(49) Re-appropriation The transfer of funds from one primary unit of appropriation to
another such unit (i.e Detailed Head).

(50) Recoverable Payment means a payment to or on behalf of a contractor which does not
represent value creditable or payable to him for work done or supplies made by him and has,
therefore, to be made good to Government by an equivalent cash recovery or short payment of
dues.
(51) Running Account The payment for work or supplies is made to a contractor at convenient
intervals subject to final settlement of the account on the completion or determination of his
contract.

(52) Sectional Officer –A non-gazetted official namely JE who is placed in responsible

executive charge or works or stores under the orders of the Officer-in-charge of a recognized
sub-division and the accounts of whose transactions are, therefore, ultimately incorporated in
those of the Sub-division.

(53) Secured Advance An advance made on the security of materials brought to site of work, to
a contractor whose contract is for the completed item of work.

(54) Special Office – The Office of a Special Officer, (see next)

(55) Special Officer (or Specialist Officer) – Those officials of the Department who are not

- Divisional Officers OR

- Officials subordinate to a Divisional Officer, and

- have no Divisional Officers working under their control.

(56) Storage charges- The expenditure incurred, after the acquisition of the stores,

- On work-charged establishment, employed on handling and keeping initial accounts, the

custody of stock and the maintenance of the store godown or yards, etc. and

- These are added on a percentage basis to the issue rate,

(57) Sub-divisional Officer –An official, whether a gazetted officer or not, who holds the
charge of a recognized sub-division subordinate to a Divisional Officer.

But When a Divisional Officer holds the immediate charge of a recognized sub-division in
addition to his own duties as the executive head of the division, he is treated as the Sub-
divisional Officer in respect of the charge of the subdivision.

(58) Sub-head – For the purpose of financial control and convenience (where the work is
large) the total cost of work is divided into small portion which are called sub-heads e.g.
excavation, brick-work, concrete, wood work, etc.

(59) Sub-work – In the case of a large work consisting of several buildings or smaller work,
or groups thereof, each such distinct unit is considered as Sub-Work if that unit is sufficiently
large or important to kept distinct for the purpose of accounts.

For example, the outer wall, the solitary cells, the cook-houses, the jailor’s quarters, etc.

(60) Supervision charges –The charges which are

- levied (Not in Govt Issues), in addition to book value in respect of stock materials sold or
transferred and

- intended to cover such items of the expenditure incurred on the store as do not enter their
book value. (i.e. establishment expenditure)

(61) Suspense Accounts –

There are certain transactions which cannot be cleared finally

- either for want of payment, recovery/ adjustment Or

- where it is necessary to keep watch over values of stock materials till their final disposal.

But since these transactions must be accounted for, a minor head “Suspense” is provided
under certain Major Heads for passage of such temporary transaction subject to their final
adjustment.

(62) Takavi Works – It denotes works of construction or maintenance relating to water courses
or any other works, expenditure on which is treated by Government as a takavi advance (i.e. an
advance to cultivators) recoverable from the party or parties concerned.

(65) Water Course –A channel for the supply of water from an irrigation work, which falls
under the definition of the term as given in the Canal Act. The definition given in the Northern
India Canal and Drainage Act of 1873 is as follows:-

“Water course” means any channel which is supplied with water from a canal, but which is
not maintained at the cost of Government, and all subsidiary works belonging to any such
channel.

(63) Technical Sanction –The order of competent authority in PW Deptt sanctioning a

properly detailed estimate of the cost of a work of construction or repair proposed to be carried
out by it.

Sanction accorded to a work by any other department of Government is regarded merely as an

administrative approval of the work.

(64) Voted Expenditure – The expenditure flowing from Consolidated Fund of India duly voted
by Parliament.

(66) Work – It applies not only to works of construction or repair, but also to other individual
objects of expenditure connected with the supply, repair and carriage of tools and plant, the
supply or manufacture of other stores, or the operation of a workshop.

(67) Works Expenditure and Works Outlay – These indicate respectively the expenditure,
and the other capital charges, on the special services connected with the construction, repair
and maintenance of work.
The charges falling under these categories may be net when any receipts are taken in
reduction of the charges, but they do not include the cost of the general Services, Tools and
Plant and Establishment, or any charges not taken to final heads of account but kept under one
of the suspense accounts.

CHAPTER 3 – GENERAL OUTLINES OF SYSTEM OF ACCOUNTS

CLASSIFICATION OF TRANSACTIONS

Works that can be taken up by PWDs:

1. CPWD executes primarily works of all classes (Civil/Building/Communication/ Irrigation

works etc.) required for civil departments of the Govt. In addition it may be entrusted with the
works relating to other departments or Govt/ Non-Govt. works.

Besides it may also undertake petty services like manufacture or supply of stores.

Exception:

It may not undertake the works as are vested in or transferred to the administration of
department as explained in Chapter- 5 of GFR 2005.

GFR Rule 126: A Ministry/ Department may at its discretion take up the original works /
repairs works as follows:

a. Repairs Works upto Rs. 10 Lakh (Direct Execution)

b. Repairs Works (Above 10 lakh & upto 30 lakh) & Original Works (upto Rs. 10 lakh):
Through assignment to CPWD, State PWD, BRO, MES and other PSUs.

c. Repairs Works (Above 30 lakh) & Original Works (Above Rs. 10 lakh): Through assignment
to CPWD, State PWD, BRO, MES and other PSUs BUT after consultation with Ministry of
Urban Development.

In taking up works the Ministry/ Department has to follow the procedure laid down in Rule 132
& 133 of GFRs 2005.

a. A departmental Regulations framed on the principles followed by CPWD must lay down
detailed procedure in this regard.

b. Detailed Design & Estimate to precede any sanction.

c. No work to be taken up before grant of AA & ES on above estimate.

d. Open Tender to be called for work above Rs. 5 lakh & upto Rs. 10 Lakh

e. Limited Tender to be called for work costing less than Rs. 5 lakh.

f. Execution of Contract & Award of Work should be done before commencement of work.

g. Final Payment for works done can be made only on the personal certificate of OIC/
Works.

h. The works entrusted to Public Works Organisations can be taken up by them only after grant
of AA & ES and Allotment of Fund by concerned authority.

2. General Principles of classification of Public Works expenditure:

These are laid down in Rule 29 of Government Accounting Rules, 1990 and notes under
major head 2059 and 4059.

Rule 29 :-

The classification of transaction has closer reference to the function (Major Head),
programme (Minor Head) and activity/ Scheme (Sub-Head) of the Government and the
object (Detailed Head) of the revenue or expenditure, rather than the Department in which the
revenue or expenditure occurs.

“0049-Interest Receipt”: Receipts representing ‘Interest’ are shown.

“2059-Public Works”: Expenditure on the maintenance and repairs of the non-residential

buildings under the administrative control of the P.W.D

Charging/ Adjustment of Transactions

a) Charges and receipts connected with the services pertaining to Public Works of
Government:

Finally adjusted in the accounts of Div. Officer against the provision of fund made therefor.

b) Transactions connected with the services for other Government Works:

Not adjusted finally in Divisional Accounts but pass through it for incorporation in the
accounts of concerned Deptt & Govt concerned.

c) Outlay on non-Government works:

It is charged against the deposits received therefor.

Exclusions:
These are debitable to the grants controlled by these departments:

(a) Works of the Posts & Deptt of Telecommunication or Broadcasting and other quasi-
commercial departments and undertakings.

(b) Works pertaining to Forest, Salt, Lighthouse and Mints

(c) Works connected with the conservation of ancient monuments relating to the Archeological
Department.

(d) Works connected with the construction and maintenance of civil aerodromes (ie. Airport
Authority).

3. Undertaking of Services/ supply of materials by a Division to another Division:

Inter-Divisional settlement is resorted through Advance Payment by the Indenting Division.

(Appendix-7A)

4. Operations undertaken in the manufactories and workshops of a division on behalf of

other divisions, departments, Governments, local bodies or individuals:

These are treated as operations of the division in the first instance, but the entire cost is
ultimately recovered from the party concerned. (the primary accounts of these transactions
should be kept in accordance with the rules of this code, even though the ultimate cost of the
transactions may not have to be brought to account finally in the books of the Divisional
Officer.)

5. The transactions (Finally adjustable) of Public Works officers are grouped under
following heads:-

I Expenditure heads:

2059-Public Works,(Stock/ Non-Residential- Maint/ Repair)

2216-Housing,(Residential- Maint./ Repair)

4059-Capital Outlay on Public Works,

4216-Capital Outlay on Housing etc.

II. Revenue Heads:

0059-Public Works,

0216-Housing etc.

III Remittance Heads:

8782- Cash Remittances and adjustments between officers rendering accounts to the same
Accounts Officer

(This Head accounts for the Receipts as well as payments for cash, stores or other values
received from or paid to or on behalf of other departments or Governments)

IV Suspense and Deposit Heads:

Under these heads, the account of certain payments or receipts which await clearance by
payment/ recovery in cash or otherwise are kept.

These heads may either be Independent Head/ Sub-Head or heads subordinate to

expenditure heads.

6. Accounting of Transactions under above groups:

The transactions under each of these groups are further sub-divided for purposes of accounts.

In the case of Expenditure and Revenue Heads, the division is like this:

Major Head (Main Unit of Classification)

Sub-Heads

Detailed Heads

Object Heads

OR

Major Head

Sub-Major Heads

Minor Heads

7. Opening of sub heads, detailed heads and object heads of account under the various
Major and Minor heads of accounts within their respective territories –

The UT Administration of Daman & Diu and Pondicherry has the power to do so subject to
observance of conditions laid down in Note 2 below Rule 26 of Government Accounting
Rules, 1990.

8. In case of works undertaken by the PW Department as a standing arrangement for other

departments, where the cost is debitable to those departments, the prescribed classification for
such transactions is intimated by the PAO
9. The classification and the Heads of Accounts under which transactions are adjustable have
been indicated in the List of Major and Minor Heads of Account of Union and states as
mentioned in Chapter 3 of Government Accounting Rules, 1990.

10. Revenue is realized and placed to credit of Government as it falls due under the statutory or
other rules governing it.

11. The expenditure can be incurred only against a grant voted by the Parliament or against
the appropriations provided for to meet charged expenditure.

12. Classification of expenditure incurred on a/c of payment made on the basis of Court
Rulings & Award of an Arbitral Tribunal :

These are treated as charged expenditure.

13. Classification of Lump Sum Advance to provide for immediate Financial Relief

(i) As per Rule 79 to 81 and GOI Decision of “Compendium of Rules on Advances”, a Head of
Department or a Head of office may sanction an advance to the family of a Government Servant
in permanent or temporary employ (excluding casual and daily-rated staff) who dies while
in service (whether on duty or on leave with or without pay) in order to enable the family to
meet its immediate requirements, if in the opinion of the Head of Department or the Head of
Office, as the case may be, the family concerned has been left in indigent circumstances upon
the death of the Government servant on whom it was dependent and is in immediate need of
financial assistance.

(ii) The amount of an advance shall be equal to two months’ basic pay and Dearness pay
taken together subject to a maximum of Rs. 8,000/-

(iii) Such advance is adjusted as early as possible, and in any case, within a period of six
months from the date of its sanction, by deduction from the amount that may be payable on
account of arrears of salary due, the DCRG or the CPF/GPF or any other payments due to the
deceased.

(iv)The advance granted under this Para should be debited to the Major/Minor/Sub- Head
“8550-Civil Advances-104-Other Advances-Lump Sum Advances to provide immediate relief
to the deceased Government servant’s family”.

(v) If the amount of DCRG or similar other payment is less than the advances initially
sanctioned, and if the balance is eventually treated as irrecoverable, the same should be
debited to the Major/Minor/Sub-Head “2075-Miscellaneous General Services-800-Other
Expenditure-Write off of Irrecoverable Loans” advanced to provide immediate financial relief
to the deceased Government servant’s family”, under special sanction of Government.

Chapter 3.2 SYSTEM OF ACCOUNTS

Main features of the system of Public Works Accounts :-

(a) Divisional Officer (Executive Engineer) is the primary disbursing officer

for all disbursements relating to works/ pay & Allowances (Gaz/NGE) & Contingent Charges
relating to own division as well as other divisions as may be so authorized.

Bills for all long term advances and for GPF withdrawals of staff (other than Group ‘D’) are
submitted to PAO concerned.

(b) In the Departmentalised Accounts set up, Divisional offices are assigned a Cash
Assignment Account in the accredited bank by the Chief Controller of Accounts, against
which they draw cheques for payment of bills passed by them on the basis of letter of credit.

(c) The above drawing & disbursing power may also be delegated to an officer other than the
Executive Engineer with the prior approval of CGA.

(d) All payments relating to a specified circle office(s)/Zonal office(s) is to be made by the
respective Pay and Accounts Officer.

(e) The Pay and Allowances bills of employees covered by New Pension Scheme, 2004 are to
be submitted to the Pay and Accounts Office for Pre-Check and payment. A separate Pay Bill
Register for this purpose is maintained.

(f) The monthly accounts of all receipts and disbursements are compiled by the Divisional
Accountant and are submitted to the Pay and Accounts Officer.

(g) The PAO for a particular Division is decided by Chief Controller of Accounts. General
principle is that the Division will be attached with Zonal Pay and Accounts office
corresponding to the Chief Engineer it reports for administrative directions.

(h) The charges on each project, work, or sub-work are recorded under different Major Heads
separately in the accounts of Divisional Officers.

(i) In the case of works of certain classes {(i) Irrigation, etc. commercial undertakings. (ii)
Quasi-commercial undertakings, (such as self supporting workshops)}

Proforma accounts of all transactions connected therewith are prepared annually by the Pay
and Accounts Officer or by the Divisional Officer, as may be required.

(j) The record of a transaction of receipt or expenditure is to be made at once under the
final, debt, deposit or remittance head to which it pertains, if that be known,

but if the exact head cannot be ascertained at once, then the transactions should be classified
temporarily under “Deposits” if a receipt, or under “Miscellaneous Public Works Advances”,
if a charge.

(k) In case of non-fulfillment of conditions for opening of Cash Assignment Account the
Chief Controller of Accounts may attach such division with the other Cheque Drawing
Divisional Officer or Pay and Accounts Office.
In such cases the Accounting procedure to be followed is prescribed in Annexure ‘B’ to this
Chapter.

Annexure-A

Guidlines for opening and closing of Cash Assignment Account in r/o EE,C.P.W.D.

1. Opening of Account:

In CPWD, a division is either opened afresh or after closure of other division. In all cases the
O/o DG(W) has to submit the proposal to CCA 45 days before actual opening giving all the
information eg. Name/Address of the division, address of bank while fulfilling following
conditions:

(a) There should be a sanctioned post of Divisional Accountant or a post of equivalent rank is
to be diverted.

(b) A certificate that all liabilities/suspense accounts have been cleared OR will be adopted
by the new division on Proforma Basis as per Para 16.4 of CAM. (In case of opening of division
after closure of another division).

(c) Where the balances have been adopted by successor division, the Divisional Officer as
well as the PAO has to provide the certificate to Principal Accounts Office that the balances
have been adopted.

(d) The Long Term Advances and General Provident Fund Balances etc. of Government
employees will be settled/transferred by exchange of Cheque. The

Short term Advances will be settled in terms of Para 10.8 of Civil Accounts Manual.

(e) Where the Cash Assignment Accounts is not opened for non-fulfillment of above
conditions, the concerned Division will be attached with Pay and Accounts Officer or other
Cheque Drawing Divisional Officer.

2. Closing of Accounts The office of DG (W) shall intimate the Chief Controller of Accounts 45
days in advance before actual closing of the division

alongwith a certificate that all the liabilities and balances under Debt., Deposit, Remittance
and Suspense heads have been cleared.

If not it shall direct some other division to accept the balances of the Division in terms of
Para 16.4 of Civil Accounts Manual. In this case, certificate of adoption of balances in the books
of the nominated Division as well as Pay and Accounts Officer shall be furnished along-with the
proposal.

Annexure-B
Accounting Procedure for attachment of the Division with another Division / PAO of the
Division, where the Cheque Drawing Powers are not vested or Cash Assignment Account is
not opened.

(i) The EE will maintain cash book in GAR-3 (as is being done by other NCDDO).

(ii) The Divisional officer shall maintain all the Forms prescribed in the “Book of Forms of
CPWA Code” as usual

Except CPWD 51 (Settlement with Banks), as the cheque will either be issued by the Cheque
Drawing and Disbursing Officer(CDDO) with whom the Division has been attached or by the
PAO under whose jurisdiction Receipt and Payment functions have been assigned and monthly
Account will be prepared accordingly.

(iii) For making payments for works purposes:

The NCDDO, Divisional officer will present the bill to CDDO/PAO for pre-check &
payment. The Divisional officer will send an attested photocopy of the Measurement Book
(M.B), along with necessary certificate to CDDO/ PAO, who will check the bill with reference to
agreement of work, Estimate, M.B and rules and order in terms of various provisions of CPWA
Code ( para 10.2.19 etc.), CPWD works Manual , GFR, CGA (R&P) rules etc. Payment to the
contractor will either be made by cheque or through e-payment (as and when the system is
introduced),

The cheque on behalf of the contractor shall be collected by the messenger of the DDO on
production of the following receipt:-

Bill No………………. date…………..Token No………………received as……………..

(Rs………….only) by cheque from PAO in favour of………………

(iv) PAO/CDDO may arrange payment of Permanent Advance to Divisional officer or any
other other sub-ordinate officer as per the sanction of the Competent Authority in terms of
provisions of para 6.6.8 of CPWA code.

(v) No temporary advance will be drawn. In such eventuality the amount may be drawn on
Abstract Contingent bill (GAR-30- Payment Voucher) and details sent in GAR – 31 or GAR
– 32 (Adjustment Vouchers).

Accounting of transaction: PAO/CDDO will account for in following manner:

While making payment:

Debit: Major Head “8671- Departmental Balances- 101-Civil”

While adjusting:

Debit: Final Head as determined.

Contra Credit: Head “8671-Departmental Balances-101-Civil”.

The adjustment of the amount drawn on Abstract Contingent bill should be adjusted within one
month from the date of drawal.

Vouchers less than Rs. 500/- need not be sent to PAO/CDDO.( Note below para 3.4.3 of
CAM).

(vi) All receipts in the form of instrument i.e. Draft/Cheque will be endorsed in favour of
CDDO/PAO intimating necessary classification.

(vii) All cash receipt shall be remitted directly into bank through challans.

(viii) Divisional Officer (NCDDO) will be personally responsible for clearance of balances
under CSSA and MPSSA.

(ix) the Cheque drawing Divisional Office will compile the Monthly Account on behalf of
such Division.

CHAPTER 4 - RELATIONS WITH CHIEF CONTROLLER OF ACCOUNTS

4.1 GENERAL

1) The Divisional Officer,

- He is the primary disbursing officer of division.

- He is responsible for financial regularity of transactions, correct maintenance of accounts

and their submission to PAO for post-check and incorporation in the general accounts.

- He has a right to seek the advice of the CCA in all matters connected with the accounts of his
division or the application of financial rules and orders.

It is however desirable that he shall first obtain the advice of the Divisional Accountant who
is specially trained for this duty, and this should be done in writing in all cases of importance.

2) Divisional Accountant

- He is posted to assist Divisional Officer in discharging his responsibilities by the Chief

Controller of Accounts.

- Such official is either recruited through initial recruitment examination conducted by IA&AD
or has qualified in SAS/JAO(C) Examination with Public Works as a compulsory paper.

- As a stop gap arrangement a UDC/ an Accountant may be appointed as DA by CCA.

- The term “Divisional Accountant” includes Selection Grade Divisional Accountant/Junior

Accounts Officer/Assistant Account Officer.
3) Functions of the Divisional Accountants:

a) He functions as Accountant (Accounts Compilations), Internal Checker (Preliminary checks

of initial accounts, vouchers etc.) and Financial Assistant (Adviser to Div. Officer on Accounts
& Budgetary matters).

b) He should be fully conversant with all sanctions, orders and other divisional proceedings
which affect the accounts of receipts/ charges.

c) He is treated as the senior member of the office establishment though his position is
analogous to that of a Sub-Divisional Officer, vide paragraph 45 of the Central Public Works
Department Code.

d) He is duty bound to bring the fact (where he considers that any transaction/ order affecting
receipt or expenditure would be challenged by PAO etc.) to the notice of the Divisional Officer
with reasons to obtain his orders.

The DA has to follow such order but if he is overruled and is not satisfied with the decision of
Div. Officer, he should at the same time make a brief note of the case in the Register of
Divisional Accountant’s Objections, Form-60, and place the Register before the Divisional
Officer for reconsideration of the decision or recording his reason for disregarding DA’s advice
for PAO’s information.

An objection entered in this register is not considered as finally disposed of until it has been
reviewed by the PAO, for whose inspection the register should be available at all times. If no
inspection (by Accounts Officer) takes place in a year, the Register or, an extract there from
should be submitted to the Accounts Officer in the month of April for review.

e) He is responsible for the safe custody of documents

f) He is responsible for the efficient and satisfactory checking arrangement for the computed
tenders and conducting a test check personally to satisfy himself.

g) He is bound to bring to the Divisional Officer’s notice all instances relating to exceeding of
the financial limit (as delegated) by subordinate officers. This will also include watching of
excesses in expenditure against the appropriation for individual works.

h) He may undertake scrutiny of the accounts of the receipts and disbursements of

subordinate officers as required by the Divisional Officer.

i) As a rule he is not involved in monetary transactions. However where the transactions are
not large the Divisional Officer may on his own responsibility and with prior approval of CCA
entrust such job to the DA.

DA however cannot issue Final Receipt (Form-3) over his own signature.

j) He should affix his dated initials after the last entry of the day’s transaction in the Divisional
Cash Book/Stock Accounts, in token of check.
k) He is also required to make periodical inspection of the accounts records of Sub-Divisional
Officers and to check a percentage of the initial accounts under the orders of the Divisional
Officer and bring the defect to the notice of Div. Officer and SDO/ subordinate staff.

The results of these inspections should be placed on record for the inspection of the CCA. The
serious financial irregularities are to be reported at once for the information of that officer, even
though set right under the orders of competent authority. All defalcations or losses of public
money, stores or other property should be reported immediately to the CCA and other authorities
concerned.

l) He should also examine that the Form-85 (Accounts of interest bearing securities) & Form-
86 (Annual Account of Interest Bearing Securities) are correctly maintained by Sub-divisional
Officers. A few transactions in the register should be compared with the entries in the cash book
or other account, and vice-versa.

INSPECTION BY THE AUDIT/ACCOUNTS OFFICERS

- The periodical Test Audit and Local Inspection of Divisional and Sub-Divisional offices are
arranged by Audit/Accounts Officer with approval of Competent Authority.

- Divisional Officer is responsible to provide initial accounts with connected documents for
inspection.

- The presence of HOO at the time of inspection is desirable but not essential.

- Inspecting Officer should discuss the draft IR wherever possible with the HOO before its
submission to Head of Audit/Accounts Offices.

COMMUNICATION OF SANCTIONS TO PAY & ACCOUNTS OFFICER

a) Sanctioning Authority is required to communicate all sanction/ orders forming base for
audit of receipt and expenditure to the Audit Officer and PAO (Para 84 CPWD Code & Rule-
29 of GFR 2005- Procedure for communication of Sanctions)

b) Only the sanctions of Divisional Officer relating to Write Off of Stores OR Loss of Public
Money are to be checked by the PAO.

Other sanctions of Divisional Officer are to be checked by the Divisional Accountant.

c) It is not necessary to supply Administrative Approvals to the Accounts Officer.

d) Technical sanctions need be communicated to the Accounts Officer only in respect of:-

- Project Work costing more than Rs.25 Lakhs and

- Non-projects works costing more than Rs. 10 Lakhs.

e) Financial sanctions (known as expenditure sanctions) and allotment of funds should be

communicated to the Audit Officer and/ or the Accounts Officer.
Communication of Result of Audit to Divisional Officer
a) The results of audit/inspection are communicated in the form of Audit Notes, Inspection
Reports, letters or memoranda. These should receive prompt attention vide Rule 62 of R&P
Rules 1983 (Audit Objection & Recoveries).

b) The replies of the Divisional Officer should be based, as far as possible, on his own
knowledge.

c) Part I of the Audit Note and the Inspection Report should be returned through the
Superintending Engineer after the Divisional Officer has recorded his replies thereon. The
Superintending Engineer will pass orders in respect of matters which he is competent to deal
with finally and record his remarks (with a note of the action taken) on all other points, before
returning the documents to the Audit officer/Accounts Officer.

Exception the Divisional Officer may send his first reply to an Inspection Report direct to
the Audit Officer/ Accounts Officer with a copy of the reply to the Superintending Engineer.

d) Once a transaction is entered in the Audit Note or otherwise challenged in one or the other
documents, the responsibility for having the objection removed will devolve upon the Divisional
Officer, and the Audit Officer/ Accounts Officer is required to report to the higher authorities all
important items and any serious delays in the adjustment of individual objections.

e) An audit objection is usually removed by

- Obtaining the requisite sanction,

- Making the necessary recovery,

- Correcting or completing the relevant account or voucher

- Furnishing the necessary documents or information,

- Securing compliance with the provisions of a specified rule.

f) An Audit Objection which is protested as being incorrect will remain in force till its
withdrawal is intimated by Audit/ Accounts Officer.

g) In case of objections on inadequate sanction, excesses and other deviation where the
Divisional Officer has already taken action to regularize such transactions within his powers
without preparing Revised Estimate But intimation of such sanction does not reach the
Audit/Accounts officer while the divisional accounts are being audited/ inspected, the Audit /
Accounts officer will raise the objection as they are not authorized to assume that necessary
sanction has been accorded. As such in order to avoid unnecessary raising of objections, the
Divisional Officers are required to sent earliest intimation of such actions/ information to the
Audit/ Accounts Officer (i.e within a week of dispatch of Monthly Accounts if such intimation
cannot precede or accompany it).
h) Divisional Accountant is responsible

(i) for bringing prominently to the notice of the Divisional officer, at least once a month, all
irregular transactions on which action has not already been taken by the latter at the instance of
Sub-Divisional Officers or on his own and

(ii) for giving effect to the provisions of this paragraph.

Chapter -5 Appropriations and Re-Appropriation

5.1 Introductory

1. Appropriation:

- Allotment of a particular sum of money to meet expenditure on a specified job as

enunciated in the Detailed Demands for Grants.

- Operative only for the financial year for which it is made.

(a) Expenditure can only be incurred on a work or other object if:-

(i) Sanction for expenditure (special/ general) of competent authority has been obtained.

(ii) Funds to cover the charges have been provided by competent authority.

(iii) Expenditure conforms to the relevant provisions of the Constitution/financial rules,

regulations and orders.

Note- The Accounts Officer should bring to the notice of competent authority the instances of
incurring of unauthorized liability on work by PW Officer to get the work stopped or regularize
its execution. (Para 66 of CPWD Code)

(b) Payments chargeable to the accounts of other divisions, departments of Government, or

of non-Government works, and repayments of deposits,

- Divisional Officer does not necessarily require any specific provision of funds within the
appropriations for his own division.

- It is sufficient to see that such payments are made only in accordance with the rules in the
relevant Chapters of this Code.

Note- For inevitable payments, see paragraph 10.5.23.

5.2 GRANTS AND THEIR DISTRIBUTION

- A grant or supplementary grant may be in respect of expenditure falling under one or more
major heads or sections of a major head.
- For purposes of financial control, the grant allotted to each major head of account is
divided into primary units of appropriation.

5.2.2 Form of Accounts – Main Divisions of Accounts

Govt. account is kept in the following three parts, (asper the Constitution of India):-

Part I Consolidated Fund of India

It has two divisions:

(i) Revenue consisting of 2 Sections for

-“Receipts heads (Revenue Account)”: dealing with the proceeds of taxation and other receipts
classed as revenue

-“Expenditure heads (Revenue Account)”: dealing with expenditure met therefrom.

(ii) Capital, Public Debt, Loans consisting of 3 Sections for

-“Receipt heads” (Capital Account): deals with receipts of a Capital nature which cannot be
applied as a set off to Capital Expenditure

-“Expenditure heads (Capital Account)”: deals with expenditure met usually from borrowed
funds with the object of increasing concrete assets of a material and permanent character. It
also includes receipts of a Capital nature intended to be applied as a set off to Capital
expenditure.

-“Public Debt”, “Loans and Advances”: comprise of loans raised and their repayments by
Government such as, Internal Debt, External Debt of the Central Government and Loans and
Advances made by Government and their recoveries, transactions relating to “Appropriation
to Contingency Fund” and “Inter-State Settlement.”

Part II Contingency Fund of India (including Union Territory Administration) or of the

State or Union Territory Government concerned.

The transactions connected with the Contingency Fund set up by the Government of India or
of a State or Union Territory Government under Article 267 of the Constitution / Section 48
of the Union Territories Act, 1963 are recorded.

Part III Public Account of India (including Union Territory and Union Territory
Administration / Government) or of the State concerned.(No separate Pub.A/c for UT Govt
and transactions are booked in Pub. A/c of India)

The transactions relating to “Debt” (other than those included in Part I Consolidated Fund),
“Deposits”, “Advances”, “Remittances” and “Suspense” are to be recorded.
The transactions under Debt, Deposit and Advances: Here the Government incurs a liability
to repay the moneys received or has a claim to recover the amounts paid, together with the
repayments of the former (Debt and Deposits) and the recoveries of the latter (Advances).

The transactions relating to “Remittances” and “Suspense”: This Part embraces all merely
adjusting heads under which such transactions as remittances of cash in Banks appear. The
initial debits or credits, to these heads will be cleared eventually by corresponding receipts
or payments either within the same circle of account or in another account circle.

Sectors and Sub-Sectors of Accounts

(a) Part-I Consolidated Fund:

- Within each of the Divisions and sections the transactions are grouped into Sectors such as,
“General Services”, “Social Services”, “Economic Services” under which specific functions
or services shall be grouped.

-The sectors in some cases are sub-divided into Sub-Sectors (as enumerated in the list of Major
& Minor Heads of Account).

-The Sectors/Sub-Sectors are further sub-divided into Major Heads of Account.

- Each Sector in a section shall be distinguished by a letter of the Alphabet.

(b) In Part II – Contingency Fund: It has a single Major Head and all the transactions met out
of the Contingency Fund are recorded under it.

(c) In the case of Part III – Public Account:

- The transactions are grouped into Sectors and Sub-Sectors,

- Sector/Sub-Sectors is further sub-divided into Major Heads of Account.

- The Sectors / Sub-Sectors is distinguished by letters of the Alphabet.

5.2.4 Allotment of Code to each Major Head and range of Code Numbers.

- A four digit Code has been allotted to the Major Head,

- The first digit indicates whether the Major Head is a Receipt head or Revenue Expenditure
Head, or Capital Expenditure Head or Loans and Advances Head or it pertains to Public
Account.

- If the first digit is ‘0’ or ‘1’ the Head of Account will represent Revenue Receipt,

- If the first digit is ‘2’ or ‘3’ it will represent Revenue Expenditure,

- If the first digit is ‘4’ or ‘5’ it will represent Capital Expenditure;

- If the first digit is ‘6’ or ‘7’ it will represent Loans and Advances Head;

- If the first digit is ‘8’ it will represent Contingency Fund and Public Account (4000 for
Capital Receipt) and (8000 for Contingency Fund).

Consequent addition of 2 to the first digit of the Revenue Receipt will give the Code Number
allotted to corresponding Revenue Expenditure Head, the Capital Expenditure Head and the
Loans and Advances Head of Accounts; e.g.

0401 represents the Receipt Head for Crop Husbandry.

2401 represents the Receipt Expenditure Head for Crop Husbandry.

4401 represents the Capital Outlay on Crop Husbandry.

6401 represents Loans for Crop Husbandry.

Such a pattern is however, not relevant for those departments which are not operating
Capital / Loan Head of accounts e.g. Department of Supply.

In few cases where receipt / expenditure is not heavy, certain Major Heads have been combined
under a single number and the other relevant Major Heads themselves form sub-major heads
under that number.

For example Major Head “4202 – Capital Outlay on Education, Sports, Art and Culture” where
under the distinct Revenue Expenditure Major Heads 2202 – General Education, “2203 –
Technical Education, “2204 – Sports and Youth Services and “2405 – Art and Culture” have
been brought down as “Sub-Major Heads” as 01, 02, 03 and 04 respectively.

Range of code numbers allotted under the scheme of codification is as below:-

Part I – Consolidated Fund Major Head Code Nos.

Section I – Receipt Heads – (Revenue Account) 0020—1999

Expenditure Heads - (Revenue Account) 2011—3999

Section II – Receipt Heads – (Capital Account) 4000

Expenditure Heads -(Capital Account) 4046-5999

Section III- Public Debt, Loans & Advances 6001-7999

Part II Contingency Fund 8000

Part III – Public Account 8001-8999

5.2.5 Major, Sub-Major, Minor, Sub-Head, Detailed and Object Heads

The classification structure of Govt Accounts has a Six Tire Arrangement (Sectors, Major
heads, Minor heads, Sub-heads, Detailed head and Object head)

Major Head (Main unit of classification i.e Function)

Minor Head (Identify Programme)

Sub-Head (Schemes & Activities covered by Programme)

Detailed Head (It is now termed as sub-scheme)

Object Head (It is termed as “Unit of Appropriation” which is meant for itemized control over
expenditure and indicates the object/ nature of expenditure on Scheme(Sub-Head), Sub-Scheme
(Detailed Head) or Activity/ Organisation e.g. “Salaries”, “Office Expenses”, “Grants-in-aid”,
“Loans” and “Investments” etc.)

OR

Major Head (correspond to Function)

Sub-Major Head (corresponds to Sub-function)

Minor Head (identify the Programme undertaken to achieve objectives of Function represented
by Major Head)

- The detailed classification of account heads in Government Accounts and the order in which
the Major / Sub-major and Minor heads shall appear in all account records shall be such as are
prescribed by the President on the advice of the Comptroller and Auditor General of India.

The list of Major and Minor heads of Accounts of Union and States contains the classification
prescribed (including the code No. assigned up to the major / Sub-major heads and minor heads
thereunder) should be strictly followed.

5.2.6 CLASSIFICATION OF EXPENDITURE AS “CHARGED” OR AS “VOTED”

Expenditure which is subject to the vote of the Legislature is to be shown in the accounts
separately from expenditure which is “Charged” on the Consolidated fund of India or of a State
or Union Territory Government. The expression “Charged” or “Voted” are appended to the
heads concerned to distinguish the two categories of expenditure.

Procedure for preparation of Budget Estimate under Sub-Head: Stock Minor Head “799-
Suspense Major Head 2059 Public Works”

a) The Central Store Division will prepare its budget on the basis of their requirements.

b) The working divisions will, however, prepare their budget for stock in two parts viz., (1)
direct purchases, and (2) by indenting on Stores Divisions.
c) Provisions for stock under category (2- By indenting on Stores Divisions) made by the
working Divisions will then be reduced from the provisions of Stores made by the Central
Stores Divisions at Zonal Levels.

d) In case of such provision (c) above made by Working Division not falling under the
jurisdiction of concerned Zone (where Central Stores Division functions), The concerned
Zonal CE works out the such provisions on the basis of data received and intimate the other
Zonal CE under which the Central Stores Division functions for necessary adjustment.

The procedure relating to the preparation of Demand for Grants, to the appropriation and re-
appropriation of funds, to the distribution of fund and to the Budget matters generally is laid
down in the General Financial Rules. The special procedures applicable to C.P.W.D. are
detailed in Departmental Manual.

Grants for Expenditure Abroad

- Estimates of transactions taking place abroad are required to be accounted for under the
functional Major Head of Account, relevant minor head, Sub-head, Detailed Head and Object
Head as the case may be.

- receipts of the department arising in the accounts of the High Commission / Embassy of
India,

The receipts are passed on by the PAO, Ministry of External Affairs to the PAO concerned of the
Department for eventual booking under the relevant minor head of the Major Head concerned.

-In the case of expenditure abroad viz. expenditure on stores, the debit on this account would
be passed on by the P.A.O., Ministry of External Affairs, to the P.A.O. concerned of the
Department for eventual booking under the relevant Major / Minor /Sub and detailed head of
account.

The estimates for departmental payments abroad with the abolition of the average rate of
exchange w.e.f. 1.4.74, These are required to be budgeted by adopting the composite rate of
exchange as notified by the Ministry of Finance.

The resultant loss by exchange arising from such transactions is debitable to the capital head
concerned

while in the case of revenue heads, such loss/gain by exchange is accounted for under the major
Head “0075” (in the case of gain by exchange) and “2075” (in the case of loss by exchange).

5.4. Re-appropriation of Funds

(a) Re-appropriation of funds from the primary unit of appropriation to another such unit within
a grant or appropriation may be sanctioned by a Competent Authority at any time before the
close of the Financial year subject to
- the provision of Rule 10 of DFPR, 1978 and other general /specific instructions laid down by
the Finance Ministry in this respect.

(b) Re-appropriation shall be made only when it is known / anticipated that the appropriation
for the unit from which funds are being re-appropriated will not be utilized in full or that
saving can be effected in the appropriation for the said unit.

(c) Funds as a whole will not be re-appropriated from any unit with the intention of
restoring the diverted re-appropriation to that unit when saving becomes available under
other units later in the financial year.

(d) All cases of re-appropriation involving savings of more than Rs. 10 lakhs for the Plan
Heads relating to a Ministry / Department as a whole would have to be referred to the
Ministry of Finance for a decision giving detailed justification in support of the proposal.

Watching of Actuals- Responsibility of PWD Officer & PAO

(a) Divisional Officer: He is ultimately responsible for controlling expenditure within

allotment and keeping himself informed of circumstances affecting progress of expenditure in
order to take timely action for obtaining extra fund OR surrendering probable savings.

(b) HOD & PAO:

- They are jointly responsible for reconciliation of figures appearing in the accounts being
maintained by Department and PAO.

- Reconciliation is done monthly as per procedure given in GFRs.

- Initial responsibility of reconciliation rests with PAO. After the accounts for a month is
compiled, the PAO has to provide all DDO (i/c CDDO) an extract from Expenditure Control
Register/ Compilation Sheet showing monthly expenditure (i/c progressive figures from May to
March) classified under various Major Heads for reconciliation.

Practice to be followed to watch over progress of expenditure:

(a) The progress of expenditure on works or other items for which there are specific
appropriations: It should be watched individually month by month, through the Register of
Works, Contingent Register and other relevant accounts.

(b) In respect of works or items, lumpsum appropriations for which are placed at the
Divisional Officer’s disposal: The progress of expenditure should be watched against
appropriations by the maintenance of a record

(i) of the expenditure in the form of a progressive abstract, showing month by month the up-
to-date expenditure of the year, and

(ii) of the grants, in the form of a register showing the appropriations and re-appropriations
ordered from time to time.
(C) Un-discharged liabilities: It plays an important part in expenditure and as such their effect
on individual and lump sum appropriations should be watched while expenditure of a month is
being reviewed..

Liabilities may be divided into four clases

(i) Outstanding in the suspense account relating to contractors and labourers, in the accounts
of works

(ii) Outstanding in any of the regular suspense accounts of the division (this may affect the
grant for Minor Head “Suspense” under the Major Head it is classified as well as the Grant for
works & Services falling under same/ other Major Heads)

(iii) Outstanding debts adjustable by book transfer, and

(iv) Matured claims of contractors, suppliers, etc. awaiting settlement and all Unmatured
claims, the recurring or non-recurring likely to fall due for settlement before close of the year.

(d) Anticipated credits: It will ultimately be taken in reduction of the expenditure chargeable
against any individual or lump sum appropriation (Statement E of Appendix 2)

(e) This review is of special importance in the last three or four months of the year.

(f) Collective Review in r/o Primary/ Secondary Unit of Appropriation: If desired, this
review may also be conducted by maintaining a suitable register of appropriations being
maintained for the purpose: see clause (b)(ii) above. Such a review helps in formulating
proposals for re-appropriation.

Form 57- Register of Transfer Awaited: All liabilities and assets of the division (adjustable by
transfer credit or debit to remittance heads of accounts) should be recorded in the register as
soon as they become known. As they are cleared, an entry should be made in columns 7 to 9 so
that items awaiting adjustment may be known at any time.

Note- This register is intended primarily for all transfer transactions, recurring or
nonrecurring, which have to be responded to by the Division, but if desired, important items
which will be cleared by original debits or credits may also be entered to facilitate the watching
of their clearance.

CHAPTER 6 – CASH
1.“Cash” : The term includes legal tender coin, notes, cheques, Deposits-at-Call Receipts and
Demand Drafts. A small supply of one Rupee Revenue Stamps may be kept as part of the cash
balance. (Ref Rule 19 of R&P Rules,1983).

These are not cash:

(1) Government securities,

(2) deposit receipts of banks other than those referred to in the above para,

(3) debentures and

(4) bonds, accepted as security deposit

2. The Divisional Officer is the primary disbursing Officer of the division, and all realisations
and payments on Government account made by his subordinates are made on his behalf and on
his responsibility.

3. Every Government Officer is personally responsible for the money which passes through his
hands and for the prompt record of receipts and payments in the prescribed accounts as well as
for the correctness of the account in every respect.

4. The private cash or accounts of members of the department is not be mixed up with the
public cash or accounts.

5. CDDO is to effect recovery of money (incorrectly withdrawn in any bill passed by CDDO as
intimated by PAO) without delay & w/o any regard to any correspondence made and repay the
sum as per PAO’s direction.

6. A Government Officer supplied with funds for expenditure remains responsible until an
account of them has been rendered to the satisfaction of the PAO concerned. He has to ensure
that payments are made to persons entitled to receive them.

7. Any person may pay money into an accredited bank to the credit of the CPWD vide a
memorandum or Challan in Form G.A.R. 7.

MODES OF OBTAINING CASH

1) Divisional Officers are placed in direct account with the State Bank of India or with any
other accrediated bank and assigned a LOC against which they draw cheques for payment of
all bills passed by them after exercising the requisite checks prescribed by Government.

2) LETTER OF CREDIT:

- No Expenditure can be incurred out of the consolidated fund in anticipation of passing of the
Appropriation (Vote on account) Act or the Appropriation Act relating to the Budget of a
financial year.

- The first (interim) LOC to be opened in favour of a cheque drawing Divisional Officer at the
beginning of the Financial year will cover the amount to the extent of one-sixth of the
authorized Budget allocation to each Division for which vote on account has been obtained.
(CPWD DIVISIONAL BUDGET)

- For allotments out of “ other Ministries” works: Concerned CE/Division will have to
produce the Advice of the Client Ministry for allocation out of their Vote on Account after the
Appropriation Act is passed by Parliament and assented to by the President.
- The Budget allotment is communicated by the IFA (Internal Financial Adviser). On the basis
of the Budget allotment communicated by the Budget Section/Finance Division of the Ministry,
the Head of the Department, will make distribution of the allotment among the DDOs under his
control, under intimation to PAO and the Central LOC Cell.

- LOC Cell (at Principal Accounts Office) issues the amount of assignment from April to
September of the financial year upto 80 % of Budget Grants allocated to the Divisions on the
basis of the allotments for the CDDOs and the net cash requirement for disbursal of works
and ancillary payments, Pay and allowances, T.A., contingencies etc. as intimated by the
Divisional Officers,.

- While determining the Assignment for 2nd LOC, the Account Officer(LOC) will also take into
account the anticipated drawals on account of Advances and withdrawals from GPF for
which Divisional Officers are authorised to issue cheques.

- Thereafter, the Accounts Officer (LOC) will authorise the paying branch of the bank by
means of a LOC, to make payment on the cheques drawn by the concerned DDOs during the
said six monthly period, not exceeding the limit specified in the letter of credit.

- While issuing the letter of credit for the 2nd LOC of the financial year after the Appropriation
Act (Budget) is passed, the Account Officer(LOC) will take into account the amount of 1st
LOC issued earlier on the basis of the Vote on Account.

- Proposal for the 2nd LOC will be submitted by the C.P.W. Divisions not later than 10the June
every year. Reason for reduction of the amount of LOC, if any, will be given.

- Unless pointed out by the Executive Engineer(EE) concerned, no reduction on account of

Security Deposit and / or Departmental charges will be made by the LOC cell. The
responsibility for correctly mentioning the situation shall be that of Executive Engineer. (It may
be noted that old “Works” and “Deposit Works” attract Departmental Charges(DC)).

- Proposals for 3rd LOC will be submitted by 15th September alongwith the reconciliation
statement upto the end of August. The 3rd LOC will be issued by October for any new Works
authorised or new Deposits received.

- The 4th LOC will be issued upto the last working day of January which also takes into
account the Revised Estimates, Supplementary Demands etc.

- The 5th & final LOC will be issued on 15th of March indicating;-

- The Demand for Final Adjustment should be received by 10th March for the Division
located at New Delhi and

- by the 5th March for outstation Divisions.

- No further LOC for the Financial Year will be issued after 15th March.
- The paying branch is to ensure that at no time the amount assigned in the LOC is exceeded
by the payment of any cheque.

- The fresh LOC (issued after expiry of the period prescribed in the earlier LOC) will be treated
as an addition to the unspent balance of the earlier LOC except in r/o the 1st L.O.C as stated
above.

- The Accounts Officer (LOC), while communicating the assignment for the 2nd L.O.C and
subsequent L.O.C should indicate not only the amount assigned for each L.O.C, but also the
progressive total of assignments upto the end of the previous L.O.C so that the bank is
enabled to ensure that the total cumulative drawals from the beginning of the year do not exceed
the total progressive Headwise assignments.

- However, the unspent assignment for the last L.O.C (5th LOC) of the financial year is not to
be carried forward to the first L.O.C of the next year.

- The cheque actually issued during the last L.O.C but presented for payment during the
period of Ist L.O.C (within the period of validity) will be taken by the banks against the
assignment of the year in which they were drawn (Previous Year) and not against the
assignments of the year in which they are paid (Current Year).

- The Divisional Officer should keep a close watch over the drawals and should take prompt
action for the renewal of the LOC by assignment of additional funds by PAO.

Guidelines for operation of the LOC system to be followed by the C.P.W.D.

and Principal Accounts Office(PrAO) are as under:-
1. By CPWD:_

(i) The Divisions will not incur any excess expenditure and / or make any diversion of fund.
Each CPWD officer/ CE responsible for allocation / distribution of budget grants will ensure this
and strict compliance.

(ii) Each CE will give quarterly projection of expenditure and receipts to the Office of
DG(W) which in turn, will give a consolidated expenditure and receipts (Division-wise)
projections to the CCA. Shortfalls with reference to targets for preceding quarters for both
expenditure and receipts will be explained.

(iii) No unauthorized deposits (deposit works from Civil Ministries) will be accepted by the
CPWD under any circumstances and no LOC will be issued for such items starting from now. As
a practical measure, LOC will, however, be issued for deposits accepted last year.

(iv) Although in the 2nd LOC upto 80 % of budgeted allocation will be released, the EEs will
have to ensure that reconciliation of expenditure is done on monthly basis and in time bound
manner with the PAOs . Cases of default will be reported to DG(W) in October and each
month thereafter.

(v) EEs will be responsible for

- obtaining Works Abstracts from Sub-Division and

- maintain Work wise Ledgers in the Division which are prescribed as an essential requirement
for the CPWD.

(This will ensure that there are no diversion of funds from one work to another, one
Ministry to another and from deposit works / Suspense Heads to budgeted works).

(vi) Divisions will not make payment of bills of SE’s and CE’s, which is a function of PAO’s
(where PAO exists).

2. By Principal Accounts Office:-

(i) 2nd LOC (June each year) can be submitted direct to LOC Cell by all.

(ii) The subsequent LOC requests received by the PAOs will be forwarded to the Headquarters
within 7 days by the PAOs.

(iii) The LOC Cell of PrAO will release the LOC in not more than 5 working days from the
receipt of the proposal without insisting on reconciliation statement for the 1st and 2nd
LOC(April and June).

(iii) LOC for the full amount (100%) in respect of works of the Ministry of Home Affairs
and Ministry of Defence will be released, if so desired by the Divisions concerned.

(iv) LOC for the full amount of deposit (100%) in respect of Deposit works which are
permissible in the system (from autonomus bodies etc.) will be released. Departmental charges
will be presumed to be leviable / deductible from the LOC amount unless the EE specifically
suggests with reasons that no such deduction be made.

(v) LOC will be issued directly from New Delhi in respect of all Divisions under intimation to
the PAO’s concerned.

(vi) Batch processing of LOC will be resorted to, whereby outstation LOCs are issued first
(without compromising on the immediate requirement of the local Divisions).

Categories of bill that can be paid by divisional officer:

a. Works, work charged establishment and ancillary payments;

b. Pay and allowances, including wages and Medical reimbursement claims – both advances and
final bills; (However Pay and Allowances of Govt. Servant covered by New Pension
Scheme,2004 will be paid by PAO )

c. Travel Expenses;

d. Office Contingencies;
e. Advances from Provident Fund for all categories;

f. Withdrawal/ final Withdrawal from GP Fund of Group ‘D’ employees;

g. Payments arising under the Deposit Linked Insurance Scheme to Group ‘D’ employees;

h. All short term loans and advances to Government servants (i.e. recoverable in less than
60/70 instalments).

Categories of bills that can only be paid by PAO & not by Divisonal Officers:
Bills for all other kinds of payments like

a) Long term loans and advances and

b) Withdrawals from GP Fund (in r/o Government servants other than Group ‘D’)

- Above bills are submitted to PAO for pre-check and payment by cheques/ DD.

- Such payments should not be made by the Divisional Officers by issue of cheque against their
assignment.

The appropriation of departmental receipts to expenditure: It is strictly prohibited except in

certain cases (See sub-rule 2(d) of Rule 6 of CGA(R&P) Rules, 1983.)

Separate maintenance of establishment charges (pay & Allownces) & work charges:

Undisbursed balances of cash drawn for pay & allowances of regular establishment may be kept
in departmental cash chests but they should not be mixed up with the regular cash balances of
Department, accruing from money obtained on cheques for other payments (viz. works and
contingencies).

Settlement of transaction relating to outside places: The payments to be made by Divisional

Officer outside the Divisional headquarters should be settled by Bank Drafts.

Engagement of Group D for carrying Money:

- The practice should be discouraged.

- In absolute necessity, on man of some length of service and proven trustworthiness may be
engaged.

- If amounts to be handled is large, one or more guard should be engaged.

Principles for making payment in cash/ cheques:

- There is no bar on cheques being drawn for less than Rs. 10.
- The petty sums and the wages of labourers and establishment charged directly to works
(excluding such categories of work-charged establishment, as are borne on regular
establishment of the Department) should be paid in cash.

- For Petty sums/ wages and VPP, it is permissible to draw money by Cheque to replenish the
cash chest (Minimum cash actually required to meet currant disbursement).

- All cheques in Divisional office drawn for Rs. 10 Lakh and above shall bear two signatures.
The second signatory shall be the Divisional Accountant or a senior most official as may be
nominated by the CCA.

Special Rules applicable in CPWD in case of drawal of cheques

1) Divisional Officer should intimate the number of the cheque books and the serial numbers of
the cheaue forms newly brought into use to the bank & PAO.

2) Cheques shall be payable at any time within three months after the month of issue, thus a
cheque bearing any date in January is payable at any time upto 30th April.

3) Action in case where currency of 3 months expired owing to cheque not being presented
at Bank:

- it may be received back by the Divisional Officer and cancelled under his signature.

-The cancelled cheque is not to be destroyed but be treated as Voucher / Sub-Voucher for
issuing a fresh cheque in lieu thereof.

-the fact for issuing fresh cheque should be mentioned on the voucher i.e. the cancelled cheque.
Entries regarding cancellation of old cheque/issue of fresh cheque etc. should be made on the
counterfoil of old non-MICR Cheque or loose leaf/record slip of MICR cheque, and in the
relevant documents viz. register of cheque issued, office copy of the original Bill, list of
outstanding cheques etc.

4) Action in case of a cheque remaining unpaid for more than 6 month after its issue & not
surrendered for Renewal/ Cancellation:

it should be cancelled in the manner indicated in Rule 47(1)(iii) of CGA(R&P) Rules, 1983. The
practice of Revalidation of cheques has been dispensed with.

5) Action in case of request for issue of fresh cheque in lieu of a cheque allegedly lost within
a period of 01 year from date of issue of original cheque:

- The Divisional Officer will send an intimation by registered post (acknowledgement due) to
the bank drawn upon regarding the alleged loss of cheque and advise it to stop payment if the
cheque is presented for payment thereafter.

- If the currency of the Lost Cheque has not expired at the time of sending such an intimation:
the bank shall acknowledge in writing as per provision in Civil Accounts Manual.

- If the currency of the Lost Cheque has expired at the time of sending such an intimation

- No acknowledgement of the “Stop payment order” may be insisted upon from the bank;

- the Postal acknowledgement may be treated as sufficient for the record of the cheque drawing
Divisional Officer.

- On receipt of the acknowledgement from the bank:

- The Divisional Officer will send a copy of Acknowledgement to the PAO for issue of a Non-
Payment Certificate.

- The PAO, on receipt a copy of this acknowledgement will, after verification of his relevant
records i.e. register of cheques delivered, etc. and after keeping a suitable note in that register,
issue a non-payment certificate to the Divisional Officer.

- The Divisional Officer will note particulars of the Non-Payment Certificate received in his
records, to indicate that the original cheque has not been paid and it has been ‘stopped’ from
payment. A similar note will also be made on the counterfoil/record slip of that cheque and
office copy of the relevant paid voucher before issuing a fresh cheque in lieu thereof.

- The number and date of the fresh cheque will also be noted in the relevant record viz., paid
voucher and counterfoil/record slip of the old and cancelled cheque etc.

- The Paying Bank continue to remain responsible to exercise precautions to ensure that the
cheque in r/o of which such advice is received is not subsequently paid even if it does not issue a
Non-Payment Certificate.

- If the original cheque (stated to be lost) is found to have been paid afterwards: the
Divisional Officer will report the matter with the fastest mode of communication i.e Electronic
Transfers immediately to the paying branch under intimation to the PAO as per rule 48 of
Central Government Account (Receipts & Payments) Ruels, 1983.

Note: In so far as other N.C.D.D.O of CPWD are concerned, they shall be governed by the
provisions of Chapter 3 of Civil Accounts Manual (C.A.M).

6) When it is necessary to cancel a cheque before its issue:

its cancellation must be recorded with dated signature on the counterfoil/ record slip and the
cheque must be destroyed.

7) In cases where the Cheque is issued and withdrawn:-

- the cheque should be defaced and forwarded to the PAO. Simultaneously, the entries in the
accounts should be suitably reversed.
Receipt of Money
1 – Accounting Procedure

a) Money is received by a Govt Officer should at once be brought to account in the Cash Book
(Form-1) and a Receipt (CPWA Form 3) should be granted to the payer unless the
Government authorises the use of Cash Memo, (CPWA Form 3-A) in any particular case.

- If however the amount is realized by way of recovery from a bill/ voucher, a receipt may be
issued ONLY if specially desired by Payer (to whom the Bill pertains). The details of such
recovery by way of deduction should be clearly recorded on the receipt.

- Receipts (Form 3) or a cash memo (Form 3-A) can be issued only by Divisional Officer,
CDDOs or other specially authorised officer or Departmental Accounts Officer. (Such officer
are required to maintain Cash Book in Form-1)

- As per Rule 23 of R&P Rules No duplicates/ copies of Receipt granted can be issued on the
ground that the originals have been lost. In case of necessity, ONLY a certificate may be given
in lieu thereof.(Except in cases where duplicates have to be prepared and tendered with
originals as authorized by special rules)

- Receipt of money by a Govt. Officer not in-charge of a Cash Book:

he should not mix it up with the imprest or any other cash in his charge. But pay or remit it at the
earliest opportunity, to the nearest officer having a cash book or deposit into accredited Bank
accompanied by a challan in duplicate. The acknowledgement of the Bank giving full details
should be forwarded immediately to the next superior officer having a cash book, to enable him
to make the entries therein. The record of the transaction will be in the correspondence and not
in the imprest account of receiving officer.

Note:

1 Final acquaittance for private cheques and drafts on local banks accepted under proper
authority should not be given to the payer until they have been cleared.

2 The officer receiving cash has to ensure that it is duly recorded in Cash Book and the entry
is initialed with date by him BEFORE he signs the Receipt/ Cash Memo.

3 Exception: EMD in legal tender notes & Deposit-at-Call-Receipt attached to tenders:

- Such instruments relating to rejected/ unsuccessful tenders are returned to the contractor on the
same day as the tenders are opened.

- These are not accounted for in Cash Book BUT recorded in the “Register of Tenders” which
is considered as a Subsidiary Cash Book/ an Accounts Form.

- Contractor receiving back the EMD has to give a Stamped Receipt in above Register.
- In case where the EMD is received much prior to date fixed for opening of tender OR where it
cannot be refunded on that date due to some reason, such EMD should be accounted for in Cash
Book and should be returned as per procedure laid down vide Para 17.19 of CPWD Manual.

b) Accounting of Dues received in Cheques etc. from private individuals:

- If accepted, these are treated as cash and entered in Cash Book.

- When they are sent to the Bank for encashment, they are shown in the Payment Column of
Cash Book as “Remittances into Bank”.

- Where such transactions are frequent and numerous, the cheques etc may be initially entered in
“Register of cheques received and adjusted” (Form C.P.W.A. 1-A) and only the daily totals of
receipts and remittances entered in the Cash Book. This Register also facilitates the watching of
the clearance of the cheques.

Note –

1. Above procedure also applies in r/o Deposit-in-Call receipts received prior to the date fixed
for opening of tenders or which for any reason cannot be returned on that date.

2 When Cheques are dishonoured, the original entries on both the sides of the Cash Book
should be written back by minus entries.

Disposal of Receipts
- Moneys realised should be paid, as soon as possible, into the accredited Bank, for credit as
miscellaneous receipts of the department.

- A Divisional Officer may use of cash receipts temporarily for current expenditure instead
of obtaining fresh cash by cheques but before the end of the month, he must send to the Bank a
cheque for the amount thus utilised, drawn in his own designation and endorsed by himself
with the words “Received payment by transfer credit to the Public Works Department.”

- The receipts realised by short payment on bills or other vouchers can not be utilized by
Divisional Officer as above.

PAYMENTS
1. Manner of Payment

a) All payments for which officers have been authorised to draw cheques should make the
payment by cheques.

b) As a rule, no cheque should be drawn until it is intended to be paid away.

c) The cheques drawn in favour of contractors and other should be made over to them by the
disburser direct; but the disburser may be assisted in making disbursements by a cashier.
d) The occasional delivery of cheques through a subordinate may be permitted at the discretion
and on the responsibility of the disbursers. (Transaction is recorded in subordinate’s
correspondence and Not in his accounts).

e) Drawing of cheque and deposit them in Cash Chest at the close of FY showing full
utilization of grant is a serious irregularity.

f) Payments due to contractors may be made to their banks instead of direct to contractors if
so desired provided that the Department obtains:-

(1) an authorization from the contractor in legal document like “Power of Attorney”
conferring authority on the bank to receive payment, and

(2) the contractor’s acceptance of the correctness

- of the account made out as being due to him by Government or

- his signature on the bill or other claim preferred against Government,

(3) The receipt given by such bank shall constitute a full and sufficient discharge for the
payment.

(4) The contractors should, whenever possible, be instructed to present the bills duly receipted
and discharged through their bankers.

(5) Above provision does not create any right/ equities in favour of the bank, vis-a-vis
Government.

(g) The payments to suppliers of stores may be made by obtaining Bank drafts if so requested.

Guidelines for making payment for stores procured from by direct order from
Pvt. Firms and Individual abroad:
The payment is arranged in following manner as per the provisions of Rule 129 of R&P
Rules,1983:-

(i) This rule covers purchases from abroad made under the normal procedures and rules.
Purchases and procurement of stores under special arrangements will be governed by the
procedure specified in the relevant agreement or instrument or undertaking.

(ii) The concerned DDO (which placed order after due sanction) will soon after checks like
receipt/ inspection/ verification of article, forward the Bills (with certificates & endorsement) to
the PAO/AO. The PAO will pass the Bills after usual Pre-Check.

(iii) The PAO/AO will procure a Bank Draft in specified foreign currency in favour of supplier if
so permitted by Schedule of Payments and forward it to the DDO for onward dispatch to
supplier. The converted cost in Rupees as per Bank Scroll is booked under relevant Major Head
by PAO.
(iii) Payment for the supply order or order under accepted tender involving heavy
payments, with a specific payment schedule clause therein,

Payment can be made through:

(a) A LOC opened in favour of foreign suppliers through the accredited bank of the Ministry or
Department concerned.

(b) Telegraphic Bank Transfer from India directly into the payee’s pre-specified bank account
abroad as soon as the completed invoice and all relevant documents as required by the terms of
the contract are received in the Ministry/ Department/ Accredited Bank in India for the purpose
adhering to the stipulated time schedule of payment.

(Special care should be taken to ensure that the requisite documents are promptly passed on by
the bank to the respective authorities (Ministry or Department)for verification whether the time
schedule is to reckon from the date of receipt of the same by the Department or bank, whichever
is earlier.)

Stores ordered direct from firms abroad on FOB basis & subject to its own inspection by
Min/Deptt/ in consultation with DGS&D/ through Embassies & Missions:

The above payment procedure will be supplemented by a check that the inspection
certificate on the supplier’s bill has been recorded by the Inspecting party/agency concerned.

II BILLS
- General instructions regarding the form of bills and their preparation, completion and
stamping are laid down in Rule 33 to 37 of R&P Rules, 1983.

- Suppliers of stores and other should be encouraged to submit their bills and claims in proper
departmental forms.

- But, bills not prepared on such forms should not be rejected if they set forth the necessary
details of the claims. In such cases, the additional particulars required should be added by the
distributing officer.

III. VOUCHERS
(a) Every payment must be supported by a voucher setting forth full/clear particulars of claim
& other information for proper classification/identification. In case of works, the full name of
work, head of account and other particulars (for debiting charges & crediting deductions) should
be indicated.

(b) When a voucher exhibits any expenditure from which revenue may prima facie be expected
to accrue ( e.g. payment appears in a bill for removing material from a building or other work,
either dismantled or undergoing repairs or for clearing jungle or cutting trees in the compound
of building or in canal banks, etc.) a note should be recorded to indicate how the old materials
removed or the trees cut, etc., have been disposed of and if sold, when the sale proceeds will
be credited to Government.

(c) In case of absence of voucher/ payee’s receipt to support the payment:

A certificate of payment, prepared in manuscript (with full particulars of claim), signed by

the disbursing officer and countersigned, if necessary, by his superior officer, together with a
memorandum explaining the circumstances, should always be placed on record and submitted
to the Pay and Accounts Officer.

(d) Voucher must bear a pay order specifying the amount payable in words and figures signed
or initialled, and dated by the responsible disbursing officer.

(e) Voucher should also bear, or have attached to it, an acknowledgement of the payment,
signed by the person by whom or in whose behalf the claim is put forward. This
acknowledgement should be taken at the time of the payment. Payee may sign in an Indian
script but should not the amount in the international numerals.

(f) A disbursing officer,( in case of difficulty in obtaining a acknowledgement receipt in the

proper form), may decline to hand him the cheque or cash, or to make a remittance to him.

In case of payment by remittance, a note of the date and mode of remittance must be made on
the bill or voucher at the time of remittance. In cases of remittance by postal money order, the
purpose of the remittance should be briefly stated in the acknowledgement portion thereof.

(g) For article received by VPP, the value payable cover together with the invoice or bill
showing the details of the items paid for may be accepted as a voucher. The disbursing officer
should endorse, a note on the cover to the effect that the payment was made through the
post office and this will also cover charges for the money order commission.

REMITTANCES TO ACCREDITED BANK

The Officer in charge of a cash book should keep a book in Form No 4 (Remittance Register)
in which he should enter all his remittances, including cheques / drafts to the accredited Bank.

CASH ACCOUNT
1. Cash Book

(a). Upkeep

1. Divisional Officer (having CDDO Capacity) has to maintain a Cash Book (Form-1) for cash
transactions.

2. Officers entrusted with Imprest/ Temporary Advance are to maintain and render accounts of
disbursement in Imprest Cash Account (Form-2)
3. Accounting of transactions relating to pay and allowances of the staff in the Cash Book
Form I as under:

(i) Staff desiring payment by cash,

- The Divisional Officer (CDDO) draws the required cheques by their designation.

- The Cheque amount is entered in Column “Bank” on payment side of Cash Book.

- The amount of deduction should be simultaneously be entered under Column “Cash”

(Payment Side) and under Column “Amount (Cash) (Receipt Side)”.

- The transactions recorded under Payment & Receipt side are then classified under respective
Major and Minor Head.

- The amount of these cheques should be simultaneously entered in the Subsidary Cash Book
(Form G.A.R 3)

(ii) Staff desiring payment by cheques

- The Cheque amount is entered in Column “Bank” on payment side of Cash Book.

- The amount of deductions will simultaneously be entered on payment side under column
“Cash”(Payment Side) and on under column ‘Amount (Cash - Receipt Side) & (Payee A/c.).
Cheques for net amounts should be drawn in the name of the payees.

(b) Balancing of Cash Book

(i) Cash Book must be balanced on prescribed date for closing of Cash Accounts of the
Month.

(ii) If transactions are numerous, it may be balanced Daily/ Weekly.

(iii) Cash is to be counted at regular intervals & Certificate of Counting (Actual Cash Plus
Balances of Imprests & Temporary Advances) should be recorded on the body of Cash Book.

(iv) The actual balance of cash should invariably be stated in both in words and figures

(c ) Rectification of Errors in Cash Book

(i) An entry once made in the cash book should in no circumstances be erased.

(ii) If a mistake is discovered before Cash Book is closed, it should be corrected by drawing
the pen through the incorrect entry and inserting the correct one in red ink between the lines. The
disbursing officer is to initial (with date every such correction.
(iii) If a mistake is discovered After Cash Book is closed: No corrections of errors in amount,
classification or name of work, can be made in that book but through a transfer entry with a
suitable remark in red ink.

(d) Cash Verification

(i) The DDO should check all the C/Book entries as soon as they are made and put his initials
(dated) after the last entry checked.

(ii) The DDO should compare each entry on payment and receipt side w.r.t. Vouchers,
Challans, Counterfoils of Cheques etc. to ensure that

- The vouchers are complete in all respect,

- Amount of Gross/ Net payment & Deductions are correct.

- Amount remitted to bank are actually deposited.

(iii) The DDO is to verify the totalling of the cash book or have this done by some principal
subordinate (other than the writer of the cash book) who should initial (dated) it as correct;

(iv) The Actual Cash Balance should be counted on the last working day of each month (i.e.
immediately after closing the cash account of the month), OR on the first working day of
the following month before any disbursement is made on that date (where this is not possible
to count the cash balance on last working day).

The details of the actual balance should be recorded in Form 5, and a certificate of the
count of Actual Cash Balance excluding Imprest/ Temp Adv. (word/figures), should be
recorded below the closing entries of the month. The certificate should be signed by the
disbursing officer who should invariably date his signature.

(If the prescribed schedule of counting cash balance could not be followed due to absence of
DDO, the same may be done at earliest opportunity)

(v) Adjusting entry for error detected in counting actual cash balance:

(i) Excess Balance: It is treated as receipt and accounted for under caption “To cash found
surplus in chest”(Receipt Side) with classification as Major Head- 8443- Civil Deposit (Minor
Head- 103- Public Work Deposit).

(ii) Short Balance: It is treated as Advance and accounted for under caption “By cash found
Deficient in chest”(Payment Side) with classification below Sub-Head- “Miscellaneous
Works Advances” under Minor Head- 799- Suspense of concerned MH.

II. PERMANENT CASH IMPREST

(i) An imprest is a standing advance of a fixed sum of money given to an individual to enable
him to make certain classes of disbursements.
(ii) The amount of an imprest should be kept as low as possible and in no case exceed Rs. 5000/-
without the special sanction of the Administrative Ministry / Administrator concerned.

(iii) The procedure for maintenance of Permanent Advance or Imprest is laid down in Para
10.12 of CAM Volume-I read with Rule 291 of GFRs,2005.

(iv) The sanction of issue of Permanent Imprest/Advance shall be addressed to the PAO of the
Division.

(v) The PAO will obtain the Acknowledgement (as on 31st March) from such DDOs in the
month of April each year and tally the aggregate outstanding balance in Register of Permanent
Advances (CAM-61) with the Ledger Balances.

(vi) The account of imprest cash (Form-2) should be kept in duplicate. The counterfoil should
be retained by the imprest holder and the original supported by the necessary vouchers, should be
forwarded to the officer from whom the imprest is held (At the time of recoupment/ proposal to
increase or decrease the amount of the imprest/ to close the account altogether).

(vii) The account must be rendered to the DDO in time to enable him to incorporate the account
in his cash book before it is closed for the month.

(viii) The DDO should examine the imprest cash account with supporting vouchers and initial
(dated) it in token of approval and record a formal pay to authorise the recoupment,
enhancement, reduction or closing of the imprest, as the case may be.

(ix) In case of any objectionable disbursement in Imprest A/c, the DDO may recoup the
imprest in Full treating the item as “Miscellaneous Works Advances” and being entered in
Cash Book as “Item awaiting adjustment in the Imprest Account …..” for watching the removal
of object or till amount is made good by the Imprest Holder.

(x) The imprest-holder is responsible for the safe custody of imprest money and he must at all
times be ready to produce the total amount of the imprest in vouchers or in cash.

Classification of Imprest transaction:

(a) When Cheque is drawn 1st time:

Debit: Major Head “8672-Permanent Cash Imprest” & Minor Head “101-Civil”

Credit: Major Head “8782-Cash Remittances etc” & Minor head “102- Public Works
Remittances” Sub-head “ Public Works Cheques”

(b) On Recoupment of Imprest: When such cheque is encashed, the amount remains in the
hand of Officer sanctioned with Imprest, who depending of disbursement made gets the amount
recouped from time to time.

Debit: Office Contingencies or Work concerned below the functional Major/Sub-Major Heads
of Accounts
Contra Credit: Major Head “8782-Cash Remittances etc” & Minor head “102- Public
Works Remittances” Sub-head “ Public Works Cheques”

On closing of Imprest Account due to closure of division/ withdrawal of Imprest facility:

The Permanent Cash Imprest Holder will be required to refund the cash to the D.D.O for
remitting the same into the Bank. (Settlement by Reverse Entry)

Debit: Major Head “8782-Cash Remittances etc” & Minor head “102- Public Works
Remittances” Sub-head “ Remittances into Bank”

Credit: Major Head “8672-Permanent Cash Imprest” & Minor Head “101-Civil”

III TEMPORARY ADVANCE

(i) It is a remittance made by Disbursing Officer to to subordinate officer to enable him to

make specific petty payments on a muster roll or other voucher which had already been
passed for payment.

(ii) Account of Temporary Advance is kept in “Imprest Cash A/c (Form-2). It must be closed
as soon as possible.

(iii) The payment of Temporary Advance is recorded in Red ink in the inner column on
payment side of the cash book giving complete details as to whom paid and for what purpose it
has been paid.

(iv) The Adjustment of Temporary Advance in the next month is recorded in Red ink in the
inner column of the Receipt side of the Cash Book indicating “ To adjustment of
Temporary Advance given to the disburser” with full particulars.

(v) The Refund of undisbursed amount the same should be shown as cash refund in the inner
column. Such undisbursed amount will form part of the cash balance if not paid in the same
month in which refund of such advance has been recorded in the cash Book.

(vi) When such undisbursed amount is paid in subsequent month, the payment shall be
classified as “ By payment of undisbursed amount of temporary advance” in the cash
column of the payment side.

Classification of Temprary Advance related transactions:

It is classified as Debit to Final Head concerned under the functional Major/Sub-
Major/Minor/Sub-Head/Detailed Head/Object Heads etc. per contra credit to Sub-Head “02-
Public Works Cheques” under the Minor head “102-Public Works Remittances” below the
Major Head “8782- Cash Remittances etc”. so that the payments on the basis of passed
vouchers get accounted for under the final head in the same month to which such payments
pertain.

IV) DRAWAL OF ADVANCE ON CONTINGENT ABSTRACT BILLS

(i) Divisional officers may require advance in connection with:-

- Republic Day Celebrations,

- Independence Day Celebration or

- for any other contingency where payment is felt inevitable,

(ii) This is to be drawn on Contingent Abstract Bill in GAR Form-31.

(iii) Such advance must be adjusted under the proper Head of Account within one month in
GAR Form-32.

(iv)The cash taken out of the chest by the disbursing officer himself to make payments at a
distance is also regulated in the same manner

CHEQUE BOOKS AND RECEIPT BOOKS

(i) CDDO is required to send annual requisition for all three categories of cheques to PAO
concered.

(ii) PAO concerned forwards the consolidated divisionwise requirement directly to the accredited
Bank with direction to deliver the cheques directly to CDDOs/PAOs.

(iii) The concerned Bank after delivery of Cheque Books to CDDOs etc furnish a CDDO wise/
Category wise Break up of cheques with Sl.Numbers etc to concerned PAO with copy to
Principal Accounts Office.

(iv) PAO of the Divisions will endorse a copy of this requisition to their Principal Accounts
Office.

(v) The cost of printing, binding, packaging and despatch etc. of Cheque Books will be borne by
the accredited Bank.

(vi) Stock Register of Cheque Books in CAM Form 1 is to be maintained by Divisional

Offices / P.A.O.

(vii) CDDOs will intimate the first serial number of cheque of all the three categories of Cheque
Books from the first day of their use to their respective PAO with a copy to the Principal
Accounts Office for record.

(viii) PAO and Principal Accounts Office will maintain Divisionwise / PAO wise Register
respectively for issue of Cheque Books to the PAO/CDDOS and monitor and reconcile the
details on yearly basis. The reconciliation statement shall be submitted to the concerned
DyCA / CA on 10th of the month of the following year.

(ix) Receipt Books (Form 3) and Cash Memo Books (Form 3-A)
(i) These are obtained from the Central Forms Stores, Kolkata by divisional Officers.

(ii) The Divisional Officer should keep a record of the Receipt and Cash Memo Books received
and those brought to use .

(x) Cheque (or Receipt) Books should on receipt be carefully examined by the Divisional
Officer concerned who should count the number of forms contained in each and record a
certificate of count on the fly-leaf.

(xi) Cheque Books must be kept under lock and key in the personal custody of the
Divisional Officer authorised to sign the receipt.

Custody of Cash (Cash Chest regulations)

(i) Cash and valuables should of kept in strong treasure chest secured by two locks of different
pattern.

(ii) All the keys must be kept in custody of difference persons.

(iii) The chest should be opened/closed in the presence of both the custodian.

(iv) The duplicate keys of Divisional chest should be placed in separate sealed cover and lodged
with different officers of higher rank or with the relevant branch of the accredited bank. A
duplicate key register should be maintained and once a year, in the month of April the keys
should be sent for, examined and returned under fresh seal, note being made in the register that
they have been found correct.

(v) One cashier may make the cash payments of two or more Divisions wherever such an
arrangement is found to be practicable.

(vi) The Divisional Officer should count the cash in the hands of cashier at least once a month.
The result of such counting should be recorded in the form of a note in the cash book showing
the date of examination and the amount (in words) found.

CHAPTER-7 STORES
7.1 Introductory

1. The general administration of all the stores of a division for arranging following duties is
vested in the Divisional Officer,

(a) the acquisition of stores,

(b) their custody and distribution according to the requirements of works and

(3) their disposal.

Note- General instructions for the procurement of Goods and Services as per Chapter 6 of
GFRs,2005 are applicable.

2. Govt Officers entrusted by the Divisional Officer with the stores function are responsible for
maintaining correct records and preparing correct returns.

3. All transactions of receipts and issues of stores should be recorded, as per provision of
Chapter 7 of GFR,2005.

Fictitious stock adjustments are strictly prohibited, for example,

(a) the debiting to a work of the cost of materials not required, or in excess of actual
requirements,

(b) the debiting to a particular work for which funds are available of the value of materials
intended to be utilized on another work for which no allotment has been sanctioned,

(c) the writing back of the value of materials used on a work to avoid excess outlay over
appropriation, etc.

4. The fundamental principle of charging the cost:

There are 04 categories of stores: Stores item/ T&P/ Road Metal/ Other Materials.

(a) Store Items:

(i) The cost of acquisition should be debited to the particular work for which they are
required, when the work is done departmentally by the contractors whose agreement is for
labour only;

(ii) otherwise, it should be kept in a suspense account pending clearance, by debit to specific
heads of account or works.

(b) Tools & Plant:

(i) The cost of the supply of all stores, required as tools and plant for general use of the
division is debited at once to the Minor Head “Machinery and Equipment” subordinate to
the major head under which such charges of the division are classified;

(ii) Special items of tools and plant, which are required for a specific work (not for general
purpose) are debited to that work.

(c) Road Metals:

(i) If it is required for the general maintenance of a road is debited under MH-“3054 Roads
and Bridges”, Sub-Head “Maintenance and Repairs’ against the estimate sanctioned for the
collection of it and
(ii) If it is acquired specially for use in the construction of a road or other work, its cost is
debited to the estimate for such construction.

(d) Other Materials: In the case of other materials when purchases are made for the general
requirements of works, the cost is accounted for under the Suspense Head “Stock”.

5. The four classes of stores thus fall into two distinct categories as shown below:-

(a) Stores debited to Suspense-

(i) Stock.

(b) Stores debited to final heads-

(ii) Tools and Plant.

(iii) Road Metal.

(iv) Materials charged to works

6. A numerical or quantity account (MAS/ Bin Card) of receipts, issues and balances has to
be maintained for all stores, even though debited to final heads until the stores are disposed of
finally either by consumption on works or otherwise.

This Quantity Account are to be reconciled periodically with the Value Accounts (except in
the case of stores debited to final heads).

The initial records/Returns of all stores of sub-divisions should take account of quantities
only, and

that the value accounts should be maintained in the divisional office.

7.2 STOCK

I. General

1. The stock of a division is sometimes kept

- In a single godown or yard in the charge of a storekeeper or other officer, or

- Each Sub-Divisional Officer may have a separate stock in his charge, either at his headquarter
or scattered over the sub-division under direct custody Sectional Officers (i.e. JE
(Civil/Elect/Mech) OR Sec. Officer (Hort.).

2. Stock accounts may be maintained in a Sub-Divisional Office, even though the officer in
charge is not authorized to keep a cash account in Form I. A separate account should be kept in
the Divisional Office of any stock which is directly under the charge of the Divisional Officer.

II. Priced Vocabulary of Stores

- It is a list of materials in stock, showing their correct description and identifying numbers.

- It is maintained to ensure accuracy/ uniformity of posting of all transactions and facilitate the
preparation and valuation of indents throughout the Department.

- The Issue Rates should be filled in by the Divisions concerned who should circulate them for
use by other Divisions obtaining supply of stores from them.

- These vocabularies should be kept up-to-date by issue of correction slips as and when
necessary.

III. Quantity Accounts

(a). Receipts (Sources from where materials are received in Stock)

(a) Suppliers in India or Abroad.

(b) Other sub-Divisions, Divisions or departments (including Government Workshops).

(c) Manufacture, and

(d) Works, buildings, etc.

1. All materials received should be examined, counted/ measured for their quantity/ quality/
specification at the time of delivery and should be recorded in the Goods Received Sheet (Form
8-A) and in the Bin Card (Form 8) immediately thereafter.

2. The Acknowledgement to be given to a supplier for stores received can be signed only by
the Divisional or Sub-divisional Officer.

3. Goods Received Sheets:-

- it will be printed in the form of booklets and will be duly machine-numbered,

- These will be prepared in triplicate

- One copy being retained by the store keeper and the other two sent to the Sub-divisional
Office, out of which one copy will be passed on to the supplier and the other to the Divisional
Office for posting the Priced Stores Ledger and making payments.

- The instructions regarding the making of entries in the Measurement Books apply mutatis
mutandis to the entries to be recorded in the Goods Received Sheets.

- Separate Goods Received Sheet should be prepared in respect of goods purchased from one
supplier.

- A register of Good Received Sheet (Form 12 A) should be maintained in in the Divisional

Office showing the date of issue, serial number of each booklet, the name of the Sub-division to
which issued, and the date of return of the used booklets with office copies.
A similar register should also be maintained in the Sub-divisional Office showing the names of
subordinates to whom the booklets are issued. Those no longer in use should be withdrawn
promptly even though not completely written up.

(b) Issues (Through Indents-Form 7)

1. Purposes for which the Materials may be issued from stock:-

(a) for use on works either by issue to contractors or direct to works

(b) for despatch to other sub-divisions, divisions or departments; and

(c) for sale to contractors, employees, other persons or local bodies,

2. It can be issued only on receipt of an Indent (Form 7) signed by the Divisional or the Sub-
divisional officer.

3 Indents will be printed in the form of booklets and will be duly machine numbered, and kept
in stock by the Divisional Officer

4.Indents should be prepared in quintuplicate. The 5Th copy of the indent should be retained as
the office copy and the other four (marked as “original”, “duplicate” etc.) presented to the
Supplying Division.

5. A record of the stores indented should be simultaneously kept in the Register of Indents
Form 7-A.

6. In order to keep a watch on the materials issued to works and to avoid excessive issues, a
MAS Register (Form CPWA 35) is kept.

7. After entering the quantity issued in all the copies of Indent., an entry for such issues is
simultaneously be made in the Bin Card (Form 8).

8. One copy of the indent should be retained by the Store-Keeper of the Supplying Division as a
voucher in support of the entry in the Bin Card; the second being returned to the indenting
office. The third and the fourth copies of the indent should be sent to the Divisional Office for
further action.

9. On receipt of the third and fourth copies of the indent in the Divisional Officer the issues
should be valued at the Issue Rates fixed.

(c ) Bin Cards (Form-8)

1. A chronological record of the Receipt, Issues and the running balance of each article of
stock.

2. It is kept at the place where the materials are stored.

3. These cards will be posted from the Goods Received Sheets and the Stores Indents.
4. All the Bin Cards should be serially numbered

5. A Register of Bin Cards should be maintained in Form 12 – B.

6. The Divisional Officer should arrange periodical verification of balances as per Bin Cards
with those in the Priced Stores Ledger.

7. As soon as Bin Card is completed, it should be returned to the Divisional Officer after
carrying over the balance to the new card. When received in the Divisional Office, the entries of
the completed cards should be checked with the Priced Stores Ledger and discrepancies, if any,
pointed out to the Sub-divisional Officer concerned for further action. The Bin Cards should then
be recorded in the Divisional Office.

IV. Value Accounts

(a) Payment for Stock Received

1. The payment of bills of suppliers for stock received is made with reference to the connected
entries in the Goods Received Sheets. It (Form 8A) will be valued on the basis of prices paid or
payable as per bills or other claims.

2. Cash payment should not be made for stock received from other sources except in
accordance with the directions in Chapter 4 of Govt. Accounting Rules, 1990. When under those
rules payment for supplies made by any department is made in cash, the claims of such
department should be dealt with in the same way as those of suppliers.

3. In case of procurement through D.G.S.&D. the Indenting Division may make “Advance
payment” from the Budgeted Heads of Account to PAO, Supply, who will make payment upto
98% on the basis of proof of Despatch i.e, R.R. etc. to the supplier. The balance payment of
2% will be made to the Supplier by PAO, Supply on receipt of Consignee’s Receipt and
Inspection Note etc. of the DGS&D.

(b) Recoveries for Stock Issued

(i) Issue Rates

1. An Issue Rate is assigned to each new article as it be brought on stock.

2. This rate is fixed on the principle that the cost to be charged to works on which the materials
are to be used should approximately equal the actual cost of the stores and that there may be no
ultimate profit or loss in the stock accounts.

3. It should provide, beyond the original price paid and the cost of carriage, etc., for the
storage charges.

4. Issue rates of cement, steel or any other item in the contracts, should not be less than the
market rates of these commodities irrespective of the issue rates of the Central Stores. The
credit due to less issue rate of the Central Stores will automatically go to the work.
5. It is not necessary that the Issue Rate for an item should be the same in all sub-divisions,
but a uniform rate should ordinarily be prescribed for all localities in a sub-division.

6. The Issue Rate of an article of stock should be fixed at the beginning of each year and will
remain constant throughout the year. The Issue Rate should be revised earlier if there is any
material variation in the purchase rates.

7. The issue rates are kept within the market rates.

8 If the Issue Rate of an article is appreciably less than the market rate, the following
precautions should be taken:-

(a) Issues to contractors and sales shall be made at market rates,

(b) Issues to other divisions and departments may be made at a rate higher than the Issue
Rate.

(ii) Storage Charge

1. A storage rate if fixed annually for each Division or Sub-division on the principle that the
total estimated annual expenditure on maintenance of store is, as far as possible, recovered
from the issues likely to be made during the year.

2. Storage charges are added on a percentage basis to the issue rate.

3. The expenditure on storage charges is debited to a distinct Detailed Head “Storage” under
“2059 Public Works – Other expenditure / 4059 Capital Outlay on Public Works etc.” as
the case may be.

4. The amount of recoveries effected for the year on account of storage (Through Issue Rates)
should be worked out from the total credits to suspense-stock and adjusted under the head “0059
- Public Works – Other Receipts” OR taken in reduction of expenditure under the sub-
head “Deduct Receipt and Recoveries on Capital Account” which may be opened below the
relevant minor head under “4059 Capital Outlay on Public Works etc.”

5. The amount so adjusted should be compared with the expenditure on storage as booked
against the final head of account and the profit / loss on storage, if any, should be adjusted in
accounts in accordance with the provisions of paragraph 7.2.33.

(iii) Handling and Other Incidental Charges

1. Carriage and other incidental charges which are incurred simultaneously in connection
with several articles of stock and cannot be allocated to the various articles, should be booked
under a separate sub-head under stock titled “Handling and other incidental charges.” This
is included in Issue Rate on percentage basis.

Accounting for sale of articles to different department etc.

-A Sale Account in Form 19 should be prepared by Sub-division in support of every such sale
for Divisional Officer to effect recovery.

- 10 Percent supervision charges should be realized in addition to the value of stock including
storage charges in all cases

- The amount recovered on this account should be treated as Revenue/ Capital receipts.

(d) Monthly Summaries of Stock Receipts and of Indents (i.e. Issues).

1. The receipt and issue transactions of the entire Division are abstracted in the “Summary of
Stock Receipts” (Form 9) and the “Summary of indents” (Form 10).

2. These forms are posted daily in the Divisional Office from the copies of Goods Received
Sheets and the Indents.

3. The entries are made only in respect of value.

4. The total value of receipts and issues in these Summaries should be reconciled with the
corresponding monthly total of the Priced Stores Ledger (Form 12)

V. Priced Stores Ledger

1. It is an Account (Form 12) maintained in the Accounts Branch of the Divisional Office to
record day to day transactions relating to each item of stock.

2. it has different sections or sets of pages for different articles of stock with columns for
receipts, issues and balances for both quantities and values.

3. Separate Ledger is maintained for articles falling under each sub-head of Stock i.e civil/
electrical/ mechanical likewise.

4. All items of receipts and issues is entered in the Ledger from the copies of Goods Received
Sheets and the Indents which are received daily from the Sub-divisions.

5. At the end of day’s postings, the balances under each article should be worked out in
respect of quantities as well as values.

6. The Ledger should be closed for both quantities and values at the end of each month.

7. The monthly total of receipts, issues and balances should then be worked out for all the sub-
heads, which should agree with the Summary of Stock Receipts and the Summary of
Indents.

VI Adjustment of Profit & Loss on Stock

7.2.34 At the end of each year, the amount of annual excess or short-fall representing the
differences in values due to revision of rates etc., should be worked out proforma and credited
to Revenue (or as a receipt on capital account) or charged off as “Losses on Stock”, as the case
may be.

VII. Stock Taking

1. A physical verification of all Stores shall be made at least once in every year.

2. The verification is not entrusted to a person:

(i) Who is the custodian, ledger keeper or the Accountant of the Stores to be verified, or who is
a nominee of, or is employed under the custodian, the ledger keeper or the Accountant; or

(ii) Who is not conversant with the classification, nomenclature and technique of the particular
classes of stores to be verified.

3. The result of all verifications of stock should be reported to the Divisional Officer for
orders.

4. If any discrepancy is noticed, the book balance must be set right by the Verifying Officer,
treating a surplus as a receipt and a deficit as an Issue, with a suitable remark.

5. The value of stores found surplus should be credited at once as a revenue receipt or a
receipt on capital account, as the case may be.

6. The value of a deficit should be kept under “Miscellaneous Works Advances” pending
recovery or adjustment under orders of competent authority.

7. When the loss is declared as irrecoverable and its write off ordered, a transfer entry
should be prepared clearing the head “Miscellaneous P.W. Advances” by debit to the
detailed head “Minor Work” under revenue/Capital major head concerned.

VII. Rectification of Accounts

a) Value Accounts:

ERRORS:

(i) Clerical Error is corrected in accordance with rules relating to cash book.

(ii) Error discovered after accounts for the months are closed is corrected by:-

- Making entries of value (Not Quantity) when there is no change in the related Head of A/c
(i.e. compensating error of value),

- Transfer Entries in other cases.

CORRECTIONS:
b) Stock Accounts: Other corrections in Stock account may be necessary in the following
cases:-

(i) When quantities are found surplus or short, either as the result of stock-taking or
otherwise.

(ii) When issue Rates have to be raised or lowered,

(iii) When stores of any description become unserviceable and have, therefore, to be removed
from stock.

Method of Corrections:-

(i) Both in quantity and value accounts, all additions to quantities should be treated as receipt
and reductions therein as Issues

(ii) In the case of materials to be declared unserviceable, no adjustment should be made until
receipt of orders of competent authority, obtained on a Survey Report in Form 18.

(iii) In respect of stores declared to be in excess of requirements No correction will be made

in the accounts. Such stores will continue to be borne on the Stock account until transferred
elsewhere or otherwise disposed of in the ordinary course.

7.3 TOOLS AND PLANT

1. General

1. The tools and plant of a division are of two kinds:-

(a) General or ordinary T&P, i.e., those required for the general use of the division:

The cost of the supply, repairs, and carriage is charged to the Minor Head “Tools and
Plant”OR “ Machinery & Equipment”

(b) Special Machinery and Equipment i.e., those required for a specific work:-

The cost of the supply, repairs, and carriage is borne by the work concerned.

2. The Accounts of Tools and Plant issued for use by subordinates of the subdivision, or
temporarily lent to contractors, lent to local bodies and others should be specially reviewed
periodically to ensure its time return in good condition.

II. Numerical Accounts

(a) Receipts

1.All articles received should be examined and counted at the time of delivery and recorded in
the Tools and Plant Received Sheet, Form 13
2. Form-13 should be prepared in triplicate.

3.One copy is retained by the Store keeper and the other two are sent to the Sub-divisional
Officer,(for posting the Tools and Plant Ledger) and the Divisional Officer (for making
necessary payment or adjustment of values)

4. The acknowledgement, as may have to be given to the person from whom the articles are
received, can be signed only by the Divisional or Sub-divisional Officer

5. A register of T&P Received Sheet (Form-12A) showing the receipt, issue and return of the
booklets containing Tools and Plant Received Sheets should be maintained in the Divisional and
the Sub-divisional Offices.

(b) Issues

1. The articles of Tools and Plant is issued only on receipt of requisition known as T&P Indent,
Form 14 signed by the Divisional or the Sub-divisional Officer.

2. The unstamped (USR) but dated acknowledgements must be obtained in support of all
issues and in the case of tools etc., lent to contractors.

3. The Indent should be prepared in triplicate, two copies being presented to the Division/Sub-
division indented upon and the other retained as office copy by the indenting Division/Sub-
division.

(c) Tools and Plant Ledger

1. A consolidated account of the receipts, issues and balances of tools and plant is maintained in
the sub-divisional office in Tools and Plant Ledger (Form-15).

2. It is kept in three parts:-

Part I - For articles in hand: The articles should be grouped under the prescribed sub-heads,
which are

(1) Scientific instruments and drawing materials,

(2) Plant and Machinery,

(3) Tools,

(4) Navigation Plant,

(5) Camp Equipage and

(6) Live Stock.

Part II - For articles temporarily lent or sent out: The entries should be made in a separate
section for each contractor or other person to whom the articles are lent or sent out for repairs,
etc.

Part III - For shortage awaiting adjustment: It is brought into use only if any shortage
comes to notice

3. Part I and Part II of the Ledger should be posted from the office copies of the T&P
Received Sheets and the T&P Indents as and when a transaction takes place.

III. Payment for Supplies

Payment for tools and plant received from suppliers and other sources should be made generally
in the manner prescribed for stock receipts.

IV. Recoveries

(a) For use of Tools and Plant

1. When tools and plant are lent to local bodies, contractors or others:

The hire and other charges should be determined by local rules and should be recovered
regularly.

2. The cost of carriage of all Government tents belonging to Executive and Revenue Officers
should be debited to “Machinery and Equipment”.

If they are used wholly or partly for private purposes, recoveries will be made in accordance
with rules framed by the Administrative Ministry/Administrator concerned.

(b) For Sales and Transfers

1. A Sale Account in Form 19 should be prepared by Sub Divisional office in support of every
transaction.

2. If the amount of sale is not recovered within the month in which the articles are delivered,
it should be charged to “Miscellaneous P.W. Advances” as a sale transaction by the issue of a
transfer entry.

3. It is not permissible to write-back the cost of special tools and plant in anticipation of the
possibility of the articles being utilized on another work or project at some distant date.

4. No articles can be removed from the numerical accounts on the plea that the accounts of
the work to which the cost of the articles was debited have been closed

- until they are actually sold or transferred, or

- they having become unserviceable, their write off is sanctioned.

V. Verification

1.The rule relating verification of stock applies also to verification of tools and plant, with the
exception that when any articles are found deficient, the note of the deficiency should be made
in red ink in the Tools and Plant Ledger, Form 15, without making any entries in the quantity
columns, so that the articles may continue to be borne on the accounts of tools and plant, until
the loss is adjusted by a recovery or a sanctioned write off

2. The Discrepancies in quantities and losses is to be dealt with as under:-

a) Losses will be treated as deficiencies. When writing up the T&P Ledger, Form 15, the
deficiencies should be recorded in Part III and their clearance should be watched.

b) Articles found surplus will be treated as receipts in Part I, and will therefore require no
further action.

(c) If the deficiencies are made good in kind (Entry in TR Reced Sheed w/out quanity &
Part-III – deficiency only):

The Receipt/ Recovery is shown in the T&P Received Sheet, Form 13, without making any
entry in the quantity columns, and, in the T&P Ledger Form 15, the articles received is not to
be entered in Part I, but taken direct to Part III, for clearance of the items outstanding
therein.

(d) If the deficiencies are made good by recovery of cost or their write-off (Entry both in
Part-I & III:

The articles is shown as issued in the T&P Indent Form 14, and when entered in the T&P
Ledger Form 15, it is not only be entered in Part I in the ordinary way, but also in Part III,
thus clearing the items outstanding therein.

3) Loss of Articles temporarily lent/ sent out for repairs (Entry both in Part-I as issued
permanently & II):

(a) The cost is adjusted by recovery or write off,

(b) The items should be shown as received back in the appropriate columns of Part I & II of the
Tools and Plant Ledger and should also be shown as issued permanently in Part I of the Ledger.

4) The authority to write-off should be obtained on a Survey Report in Form 18.

7.4 ROAD METAL

1. Quantity Accounts
1 As metal is often kept in store at the road side before being laid down, a quantity account of
it should be maintained in the Sub-divisional Office in, “Statement of Receipts, Issues and
Balances of Road Metal” (Form 16)

2. The copies on loose sheets being submitted monthly to the Divisional Office within a
fortnight (Two Weeks) of the submission of the monthly accounts.

3. The Form 16 shows kilometer by kilometer the receipt, disposal and balance of road metal
of each kind (stone, kunkar etc)

4. The balance of metal in each kilometer should show whether there are any transactions on it
during the month or not.

5. Separate Statements(Form 16) should ordinarily be kept for metal collected for annual
repairs, for renewals and for petty repairs.

6. In respect of metal required for new roads or for renewal purposes:

The maintenance of this detailed account (Form 16) showing the receipts, issues and balances,
kilometer by kilometer, may be dispensed with by the Divisional Officer, provided:-

(a) that he should maintain in his own office, a register showing separately by each road or
section of a road, the quantities of metal of each description paid for month by month in
connection with all estimates for collection and

(2) that, whenever any executive officer or subordinate officer (responsible for any part of the
balance of the metal) is transferred, the accounts of Road Metal should be verified..

II. Rectification of Accounts

1. Metal found surplus, as a result of check of measurement by Superintending Engineer :

It should at once be brought in the quantity account.

2. Metal found Deficits: It should not be removed from the quantity account until recovery
of their value or receipt of sanction to write off. but a red ink remark should be recorded at
once and carried forward, from month to month, until the discrepancy is set right.

III. Schedule of Rates ( For Road Metals)

1. A rate-book or Schedule of Rates showing the lowest rate at which metal can be supplied
to the road-side throughout the division, should be kept in the divisional office in Form 17.

2. The rates should be revised from time to time, as old quarries are exhausted or new ones
opened, or as other circumstances affect the rates.
IV. Charges for Quarries
1. Sometimes the land is acquired for extracting road metal primarily intended for:-

(i) the maintenance of an existing road, or

(ii) the construction of a new road or the raising in class of an existing road,

2. The charges connected with the land and quarries are adjusted in the following
principles:-

(a) Charges not exceeding Rs.1000: The amount should be debited direct to “Maintenance
and repairs” or to “Construction” accordingly as the quarry is intended to serve the purposes..

(b) Charges exceeding Rs.1000 and the road metal is required for Maintenace of an existing
road or roads for a series of years

The total initial outlay should be debited to the sub-head “Land, Kilns, etc” of the Stock
Account and this sub-head should be gradually relieved, by debit to the collection estimates of
each year.

(c) Charges exceeding Rs.1000 and the road metal is required for Construction of Road:

It should be charged direct to the original work concerned such portion of the cost as is proper.
The balance, if any, should be debited to the sub-head should eventually be cleared by debit to
“Maintenance & Repairs”.

7.5 MATERIALS CHARGED TO WORKS

7.5.1 The accounting procedure relating to materials obtained specially for a work is described in
Chapter 10 .

CHAPTER – 8 TRANSFER ENTRIES (CAM-34 to CAM-36)

1) These are entries intended to transfer an item of receipt or charge from the account of a
work in progress or a regular head of account to the account of another work or head.

2) These are necessary in order to:-

(a) Correct an error of classification in the original accounts;

(b) Adjust, by debit or credit to the proper head of account (or work), an item outstanding
under a suspense account or under a debt, deposit or remittance head;

(c) Bring to account certain classes of transactions which do not pass through the cash or
stock account e.g. for credit to Revenue heads on account of revenue not recovered in cash
including lapsed Deposits;

(d) Respond to a remittance transaction advised by the PAO/AO, if the corresponding debit
or credit to the Remittance head has not already appeared in the accounts;

(e) Relieve the account of a work-in-progress of –

(i) Items ceased to be debitable to the estimate for work, and

(ii) Suspense charges which can no longer be kept within the accounts of the work.
(Necessary either when the accounts of any contractor or of the work itself are to be closed, or
when any recoveries (otherwise than in cash) have become due, e.g., by the transfer of stores to
any other work or account).

(f) Effect periodical adjustments eg. annual adjustment to credit to the head “8009” GPF an
amount equal to total of interest accruing and afforded to various Group ‘D’ and Work
Charged establishment accounts by contra debit to the head ‘2049 – Interest Payments’ etc .

3) Correction of wrong classification of an item of Revenue OR Expenditure Heads:

a) Before closing of Accounts of the Year:

The error may be corrected by proposing a transfer entry;

b) After the accounts are closed:

- No correction is admissible, it being sufficient to make a suitable note of error against the
original entry.

4) Correction of wrong classification of an item of Debt/Deposit/Suspence/ Remittance

Heads:

a) Before closing of Accounts of the Year

- The error must be corrected by transfer, however, old and small it may be.

- If the accounts of the year are not closed (When error occurred) , the correction should be
made by the removal (through minus entry) of the item from the head under which it was
wrongly taken to that to which it properly belongs.

b) After the accounts are closed:

(i) an item taken to One DDSR Head instead of another –

- the correction should be made by transfer from the one to the other.

(ii) an item credited to a DDSR Head instead of to a Revenue Head; or debited to a DDSR
Head instead of to an Expenditure Head

– the correction should be made by transfer to the head under which it should originally have
appeared.

(iii) an item credited to a Revenue Head instead of to a DDSR Head

– correction should be made by debiting refunds and crediting the proper head; and

(iv) an item debited to an Expenditure Head instead of a DDSR Head

– correction should be made by debiting the proper head and crediting the relevant
departmental receipt head (or in the case of a department not having corresponding receipt
head, to the major head 0075 – Miscellaneous General Services).

5. When a correction is permissible: it should be made by a formal transfer entry.

When Correction is not permissible: A suitable note of it should be made in the account
concerned.

6) All corrections in accounts advised by the PAO/AO on his auditing the documents:
Correction should be carried out (After due verification) in all relevant records in red ink and
attested by the dated initials of the Divisional Accountant. A reference to the audit note or
other advice should also be noted against the correction.

7) For every transfer entry there must either be an authority in Transfer Entry Order (Form
C.A.M. 34) or an order recorded on another document e.g., Survey Report etc.

8) A single transfer entry may cover a number of adjustments and corrections, provided that
all the necessary particulars are set forth in respect of each.

- However, on one side of every transfer entry, there should be only one major head but
there may be a debit or credit to various other heads or vice versa.

9) A TEO may be initiated by the Sub-divisional Officer, in all cases which comes under his
cognizance.

10) All TEOs should set forth such explanation of the correction or adjustment proposed to be
made as would establish clearly the correctness and necessity of the entry.

11) All transfer entries of a month should be entered in the Transfer Entry Number Book
(Form CAM 35).
12) The effect thereof should be reflected in the monthly accounts of that month after
preparing a ‘Summary of Transfer Entries’( Form CAM 36).

CHAPTER – 9 REVENUE RECEIPTS

9.1 General

1) Public Works revenue when collected should be brought to account in accordance with the
classification prescribed in List of Major and Minor Heads of Accounts.

2) It is not permissible to take credit for revenue to the head concerned until it is realized.

Exception: the following may be credited as revenue before realisation:-

(i) Supervision charges on credit sales of stock.

(ii) Sale proceeds of such articles of tools and plant as are

- creditable to the minor head:- 800 “Other Receipts” below the concerned functional Major Sub-
Major Heads of Account

-by debit to Sub-head “Miscellaneous Public Work Advances” under the Minor Head “799-
Suspense” below the functional Major/Sub-Major Heads of Account vide paragraph 7.3.13.

9.2 Irrigation Revenue

Revenue from irrigation etc. works under the administration of the PW Department will be
realised in the same manner as applicable to other revenue receipts of the Divisional Office.

9.3 Licence Fee of Buildings & Lands Demands and Recoveries

(a) From Private Persons :When a Public building, land or other property is licensed to a
person not in the service of Government, the full assessed Licence fee must be recovered in
advance.

(b) From Government Servants

The recovery of Licence fee from Government servants, occupying residential buildings will be
made either in cash or by deduction from their pay bills through their disbursing officer
concerned.

(c) Where Government residences are meant for allotment to the staff of a single
Office/Department,

The administrative Ministry concerned will make necessary arrangements for the allotment and
the recovery of Licence Fees of such residences.
(d) Where CPWD has the GPA residences under its control (In absence of office of the
Directorate of Estates):

The Divisional Officer of the CPWD Division in charge of the residences will continue to make
the allotment and recovery of Licence fee of such residences.

(e) Amounts due (hire of Government Furniture and Government Property lost or
damaged by a Government servant):

These may also be recovered either in cash or by deduction from pay bills in accordance with
the rule in this paragraph.

(f) The assessment and recovery of licence fees pertaining to buildings under the
Directorate of Estates at New Delhi and its regional offices:

These are governed by special procedure prescribed by Government.

(g) Where licence fee is recoverable in cash:

A bill in suitable form should be sent to the licensee on or before the last day of each month.
The Licensee should be required to pay the licence fees before the expiry of the following
month.

(h) When recoveries of Licence fees are to be effected through a disbursing officer,

A demand in (Form 48) Statement of Licence Fees (including hire charges of furniture,
govt property lost/ damaged) recoverable in cash or by deduction from Pay Bills, should be
sent, in duplicate, before the close of each month to that officer who will make the necessary
recoveries and return one copy of the statement, duly completed.

(i) Amounts recovered by deduction from Pay Bills of Government servants under the Payment
control of Civil PAO will not be passed on to the Divisional Officer for adjustment in the
Divisional Accounts.

(j)The PAO in whose circle, the recoveries are made will credit the revenue heads concerned
direct.

The Divisional Officer should, however, credit the accounts of the Licensees in the Register
of Licence Fees of buildings and lands, (Form 49)

(k) Although individual-wise account is maintained in the cases of licence fee (Rent) for
Government quarters (GPA managed by the Director of Estates) no monetary settlement is
to be effected.

Such recoveries are booked directly against the final head 0216 - Housing in the books of
Posts/Telecommunications/Railways.
(l)The accounts consolidating authority of the different Ministries/Departments shall render
monthly statement of receipts including progressive figures for that financial year to the CCA
of the Ministry of Urban Development and also to the computer cell of C.G.A’s organization

(m) Budget forecast for the receipt under the Major Head “0216 – Housing” based on actuals
etc has to be furnished by Postal Board, Telecom Board and F.A. Defence etc to the Ministry of
Urban Development in connection with the preparation of Budget Estimates/Revised
Estimates etc.

(n) A Licensee (who receives pension from Government) should be treated as a private
individual for the purpose and the payment will be made in cash only.

9.4 Refunds and Remissions

a) Remission of irrigation revenue allowed before collection:

It should be treated as reductions of demands,

b) Cash repayments of revenue actually collected and accounted for under the Major
Heads 0059 Public Works, 0216 Housing, 1054 Roads and Bridges or Irrigation Major
heads concerned:

It should be accounted for under the minor head “900 Deduct-Refunds” of the Revenue head
concerned.

c) All other refunds of revenue, (i.e. refunds of licence fees adjusted by short assessment or
short realization in a subsequent month) and repayments of “Receipts and Recoveries on Capital
Account” should be taken in reduction of the receipts under the heads concerned.

9.5 ACCOUNTING PROCEDURE

I. Registers of Revenue

a) All revenue receipts of the division should be classified and abstracted in a Register of
Revenue, Form 46, maintained in the Divisional Office.

b)The receipts relating to each project, for which a separate capital account is kept should be
registered separately and

All the other receipts pertaining to a major head should be booked collectively.

c) All receipts and recoveries on capital account should also be abstracted in Form 46.

II. Registers of Licence Fees

a) A Register in Form 49 (Register of Licence fees of Buildings and Lands) should be

maintained in the Divisional Office to show the monthly assessments, realizations and
balances of rents, of all residential buildings (including office buildings used as residences) and
of such other buildings, lands, etc as may be available for being licensed.

Exception: these buildings falling within the categories specified in clauses (1) and (2) of Rule
2 of Appendix 2 to the Account Code for Accountants General should be excluded from this
register

“(1) residences for use of the President or the Head of a local Administration;

(2) buildings which are situated within the precincts of jails, hospitals, police lines, tehsils,
educational institutions provided that they are allotted free under the orders of Government
to Government Servants who are required to occupy particular houses in order to ensure the
proper performance of their duties”

(3) Private buildings hired for use as residences or are used as such, wholly or in part should
be included in this register.

(4) Licence fee free quarters for Group’D’ employees need not be entered in this register
except when allotted to persons from whom licence fees is recoverable.

(5) Rest-houses and other travellers’ bungalows be entered, although licence fees receipts
from them are also treated as licence fees of buildings which are required to be booked under the
heads “Rent/licence fees”

(b) On closing the account of a work involving expenditure on the construction, acquisition
or equipment of a building intended to be used as a residence, or expenditure on additions
or alterations to an existing a residential building, the Divisional Accountant should see:-

(i) That if it is a new building, it is entered in the Register of Licence Fees of Buildings and
Land (Form-49)

(ii) That steps are taken to obtain the orders of competent authority to assess or revise the
licence fee, as the case may be and

(iii) That the correct capital cost of the building is noted in the Register of Buildings referred
to in paragraph 138 of the Central Public Works Department Code.

(c) The Licence fee for Government residential buildings shall be revised once in three years
by the Directorate of Estates. (See S.R. 324 and F.R. 45-A)

(d) Cash refunds of licence fees realized should be shown separately as minus realizations in
the Register of Licence Fee of Buildings and Lands, and thus distinguished from the gross
realization of licence fees.

CHAPTER 10 – WORKS ACCOUNTS

10.1 General

1. Works Accounts: The accounts maintained in Divisional/ Sub-Divisional Offices for

recording (i) the cost of individual works and (ii) the transactions of individual
contractors/suppliers are known as works accounts.

2. Main charges of Works: Expenditure on the construction or maintenance of a work may

be divided broadly into two classes viz

(i) Cash

(ii) Stock Charges.

Other charges affecting cost of works:

(i) Cost of Materials received from or services rendered by other division/ department, (ii)
Cash receipts as are taken in reduction of expenditure in accordance with the rules.

3. Initial Records upon which the accounts of works are based: These are as below:-

(i) Muster Roll including Casual Labour Roll

(ii) Measurement Books

(iii) Work-charged Establishment Bills (other than those borne on regular Establishment)

10.2 Cash Payments (Charges- Works)

I. Introductory

1. Cash charges on works consist of payments

(1) to labourers and members of the work charged establishment, of their wages and

(2) to contractors and others for work done or other services rendered.

The general rules relating to cash payments and vouchers in paragraphs 6.4.1 to 6.4.8 apply to all
these classes of payments. Only special rules are, therefore, set forth in this Chapter.

II. Payments to Labourers

(a) Departmental Labour

1. All persons engaged departmentally for the execution of works are considered as day
labourers.
2. Their wages is drawn on Muster Rolls. Form CPWA 21 and charged to the estimates of the
works on which they are employed.

3. Pay of following officials are NOT DRAWN on Muster Rolls:

(a) Permanent and temporary employees of the division whose pay is charged to the head
Direction and Administration.

(b) Members of the work-charged establishment as defined the CPWD Code (i.e Work-
Charged Establishment borne on regular establishment).

4. Labour Report (Form CPWA-30):

(i) For all the labourers and workmen employed on Muster Rolls, this report indicating the
number of labourers and workmen employed is required to be sent on each day to the Sub
Divisional Officer/Divisional Officer.

(ii) Labour reports for Muster rolls containing 15 persons or less are not required to be
sent.

(iii) The Daily Labour Report is checked with reference to Muster Rolls and discrepancy is to be
investigated

5) Muster Rolls (Form CPWA 21):

(a) One or more muster rolls should be kept for each work,

(b) It should never be prepared in duplicate.

(c) It is permissible, however, to keep one muster roll for labourers employed upon several
small works,

(d) Labourers may be paid more than once a month and the period determined locally.

(e) Separate Muster Rolls must be prepared for each period of payment.

(f) Muster Rolls have TWO PARTs ie.:-

PART-I The daily attendances and absences of labourers and the fines inflicted on them
should be recorded daily in Part I of the muster roll.

PART-II: the progress of work done by the labour shown thereon in all cases where such
work is susceptible of measurement.

If the work is not susceptible of measurement, a certificate to this effect should be recorded.
(It is not necessary to reproduce the details of measurement in Part II, nor need Part II be
written up if progress is reported once a month or often in any other suitable Form and such
separate reports are considered sufficient.)

(g) The Muster Rolls are to be checked 100% by the Sub-division wrt the entries in the
Measurement Books before payments are made by the Divisional Officer.

(h) After a muster roll has been closed, payment thereon should be made as expeditiously as
possible.

(i) Each payment should be made or witnessed by the Official of highest standing available
who should certify to the payments individually or by groups.

(j) Item remaining unpaid, should be recorded in a Register of Unpaid Wages, (Form CPWA
21-A maintained in the Sub-Division),

(k) The payment of unpaid wages should be made on Hand Receipt, Form CPWA 28;

(l) Wages remaining unpaid for three months should be reported to the Divisional Officer
who will decide in each case, whether the liability should continue to be borne in the accounts
of the or should be credited to capital or revenue.

(h) Casual Labour Rolls (Form-21)

(i) This form is used for payment where labourers are employed casually for short period in
exceptional and urgent cases like Urgent Silt Clearance of Canals, Closing of Breaches of
Bunds etc.

(ii) The Name of labourers engaged need not be given in the form.

(iii) Such payment cannot be made EXCEPT by a Gazetted Officer.

(b) Labour engaged through a Contractor

1. The payment of daily labour through a contractor, instead of by muster roll in the usual way, is
objectionable in principle.

2. In a case of great emergency it may sometimes be found impossible to employ labour

otherwise than through a contractor.

3. Where it is possible to determine the quantities of work done after its completion or at
intervals during its progress, (Payment on the basis of quantity of work done)

It is expedient to pay the contractor, at suitable rates, on the basis of work actually executed.
4. Where it is NOT possible to determine the quantities of work done after its completion
or at intervals ( On the basis of labours employed)

In the case of urgent repair of canal breaches, this method of payment is not practicable, it is
permissible to pay the contractor on the basis of

- the numbers of labourers employed, day by day,

- his own profit or commission being either included in the rates allowed, or paid separately in
lump sum or at a percentage rate.

When this course is adopted a report of the numbers of labourers employed day by day
should be made daily by the official incharge of the work to the Sub-divisional Officer.

5. The use of the muster roll or the measurement book is not permissible in such cases.

(c ) Travelling Expenses
When it is necessary to bring labourers and artificers from a distance

They may be allowed wages for the number of days occupied in the journey to and from the
site of the work, if they join the work with proper despatch.

At the discretion of the Divisional Officer, bona fide traveling expenses may also be allowed to
them.

The above charge must be borne by the estimate of the work.

II PAYMENTS TO SUPPLIERS AND CONTRACTORS

(a) Record of Measurement

(i) Measurement Books (Form-23)

1) Payments for all work done (otherwise than by daily labour) and for all supplies required for
specific works are made on the basis of measurements recorded in measurement books, Form
CPWA 23.

2) All the measurement books belonging to a division should be numbered serially and a
Register of Measurement Book should be maintained in Form CPWA 92 in the divisional
office showing the serial number of each book, the names of the sub-divisions to which issued,
the date of issue and the date of its return, so that its eventual return to the divisional office may
be watched.
- A similar register should also be maintained in the Sub-divisional office showing the names
of the Sub-divisional Officer and Sectional Officers to whom measurement books are issued. (It
is also known as MB Movement Register)

3) Books no in longer use should be withdrawn promptly even though not completely written
up.

(ii) Detailed Measurements

10.2.8 In recording detailed measurements, the following general instructions should be

carefully observed:-

(a) Detailed measurements

It should be recorded only by EE, AEE or AE or the executive subordinates in charge of works
to whom measurement books have been supplied for the purpose.

(b) All items of work in a project, irrespective of their cost, shall be measured and recorded
by the OIC of the work, not lower than the rank of J.E. The Sub-Divisional Officer may also
record measurements for any particular item of work himself.

(c) The Officer accepting the tender for any work may require the AEE/AE to record
measurements himself or exercise 100% check on the measurements recorded by his
subordinate for any item including those, which owing to their situation,

- cannot subsequently be check-measured eg. Earth work/ foundation etc or

- which have very high unit rates e.g. RCC Work or

- which in the opinion of the officer, are important.

(d) All measurements should be recorded directly in a measurement book, at the site of work,
and no-where else.

(e) Each set of measurements should commence with entries stating:-

(i) In the case of bills for work done:-

(a) full name of work as given in estimate/agreement,

(b) situation of work, (c ) name of contractor,

(d) number and date of his agreement,

(e) date of written order to commence work,(N/A where work done on Piece-Work)

(f) date of actual completion of work, (N/A where work done on Piece-Work Agt)
(g) date of measurement and,

(h) reference to the previous measurement.

(ii) In the case of bills for supply of materials required for specific works:-

(a) name of supplier, (b) number and date of his agreement or order (c) purpose of supply in
either of the following forms applicable to the cases:-

(f) In the M.B.’s and RA bills, the full nomenclature of agreement items need not be
reproduced but only the abbreviated nomenclature need be used.

(g) In the case of extra and substituted items of work for which no abbreviation/nomenclature
is provided in the agreement, the full nomenclature of item shall be reproduced in the M.B.s
and bill forms for running account bills.

(h) The pages of the Measurement book should be machine numbered. Entries should be
recorded continuously, and no blank pages left or page torn out. Any pages left blank
inadvertently should be cancelled by diagonal lines, the cancellation being attested and dated.

(i) The entries should be made in ink only. No entry may be erased. If a mistake should be
corrected by crossing being initialled and dated by the responsible officer. When any
measurements are cancelled, the cancellation must be supported by the dated initialls of the
officer ordering the cancellation or by a reference to his orders initialed by the officer who made
the measurements, the reasons for cancellation being also recorded.

(j) On completion of the abstract, the MB should be checked the Sub-divisional Officer who
should enter the word “Check and Bill” with his dated initials. The Sub-divisional Clerk
should then check the calculation of quantities in the abstract and the bill, in case of work carried
out by contract, and should then place the Measurement Book and the bill before the Sub-
divisional Officer who after comparing the two, should sign the bill and the Measurement Book
at the end of the abstract.

(k) Any corrections to calculations or rates made in the Sub-divisional, as well as, in
Divisional Office should be made in red ink and brought to notice of the Sub- Divisional
Officer or the Divisional Officer, as the case may be, and of the person recording the original
measurements. In the case of final bill, payment should be deferred until the corrections have
been accepted by the person making the measurements. All corrections made by the clerical staff
should be in red ink.

(l) Each measurement book should be provided with an index which should be kept up-to-date.

Test Checking of Detailed Measurements

10.2.9 The Sub-divisional Officer must satisfy himself [before passing a bill for payment]
before submitting it to the Divisional Officer for payment that the work or supply billed for has
actually been carried out/completed in accordance with the claim preferred. He should
personally inspect all works of any magnitude before submitting claims of final payments
in connection therewith.

In addition to the above, the Sub-divisional Officer is to check measurement of the works in his
charge as laid down in departmental manual.

(iii) Standard Measurements (BOOK-Form- 23A)

(i) The Standard Measurement Books are maintained to record the measurements of
permanent standing in a building, and are required to be brought upto date from year to year
on the basis of additions, etc. that are made to the building during a year.

(ii) These are used for preparing the repairs estimates and contractors’ bills for such repairs
so as to avoid taking detailed measurements on each occasion.

(iii) The Standard Measurement Books shall be prepared after the completion of the work by
the Construction Division that has executed the work. All drawings, Standard Measurement
Books etc. should be properly documented before handing over the building. All the

Standard Measurement Books should be on Form CPWA 23-A.

(iv) These will be accounted for in the same manner as ordinary Measurement Books in a
register in Form No CPWA 92 (Part II). The measurement books used as standard books
should be numbered in an alphabetical series, so that the numbers may be readily distinguished
from those assigned to the ordinary books wherein detailed measurements are recorded
whenever work is actually done.

(v) The entries of measurements (and abstracts thereof) in the standard measurement books
should be recorded legibly in ink, and certified as correct by a responsible officer.

(vi) SMBs should either be written by the S.D.O. himself or the executive subordinate incharge
under his orders.

(vii) Each set of measurements taken by the executive subordinate incharge should, however, be
fully checked by the S.D.O. after which it should be examined by the Divisional Officer and

(viii) After above examination it is declared in writing in the book itself as finally approved
by him for the purposes of preparing annual repair estimates and contractors’ bills for the
work done.

Until this is done, the book will not be assigned a number and will not be entered in the
Register of Standard Measurement Books.

(ix) The SMBs will be brought up-to-date under the supervision of SDO with reference to the
building or work concerned within one month of closing of the accounts of the estimate
therefor. All such corrections will be attested by the S.D.O. These should be maintained very
carefully and accurately as they may have to be produced as evidence in a Court of Law.
(x)The Divisional Officer should periodically certifty that all SMBs of the division have been
inspected by him, that entries therein have not been tampered with and that all corrections due
to additions and alterations in the buildings have been made in the books and the latter are
reliable and upto date records.

(iv) When a payment is based on standard measurements, the gazetted officer or subordinate
preparing the bill for payment should be required to certify that the whole of the work, (or work
since previous running bill, as the case may be) as per standard measurements has been done and
that it has not previously been billed for in any shape.

(iv) Review of Measurements

10.2.11 The entries recorded in each completed measurement books may be subjected to a
percentage check by the Divisional Accountant under the supervision of the Divisional
Officer.

(b) Bills and Vouchers

(i) Forms of Bills and Vouchers

1) The following are authorized forms of bills and vouchers :-

(a) First and final Bill, Form CPWA 24

(b) Running Account Bill Form CPWA 26

(c) Hand Receipt, Form CPWA 28

a) First and Final Bill, Form CPWA 24:- It is used for making payments both to contractors for
work and to suppliers, when a single payment is made for a job or contract, i.e., on its
completion.

b) Running Account Bill, Form CPWA 26:- This Form is used for all running payments to
contractors and suppliers (other than those relating to lump sum contracts for which Forms
CPWA 27-A and 27-B are prescribed), including cases where advance payments are proposed
to be made or are already outstanding in respect of the same work against the contractor.

The final payment of running work shall also be made in Form CPWA 26 printed on yellow
pages.

In cases, where secured advances are to be made or are already outstanding in respect of the
same work against the contractor, Account of Secured Advances, Form CPWA 26-A should
be attached to the bill.
c) Hand Receipt, Form CPWA 28:-This is a simple form of voucher intended to be used for all
miscellaneous payments and advances, for which the special Forms CPWA 24 and 26 are
not suitable.

The claim for refund of lapsed deposit should, however, be preferred in Form G.A.R.46

(ii) Preparation, Examination & Payment of Bills.

1) Before bill is prepared the entries in MBs relating to description and quantities of work of
supplies should be scrutinized and check measured by the SDO.

2) The bill should then be prepared from the entries in the Measurement Book, in one of the
Forms applicable.

3) The rates allowed should be entered in the Abstract of measurements and in the bill as per
agreement etc.

4) Where quality of work done/ supply made is not as per specification, only part rate (not full
rate) should be allowed. Full rate should be allowed when the contractor/ suppliers complies
with the requirement in full.

5) If the agreement does not specify the rates to be paid for the several classes of work or
supply, but merely states that the estimated rates or a certain percentage below or above
them, will be allowed,

it should be seen that the standard rates adopted are those of the sanctioned estimate which
was in force at the time the agreement was executed, or

if the agreement was preceded by a tender, on the date the tender was signed by the contractor.
Subsequent sanctions to original or revised estimate have no effect on the terms of such an
agreement.

6) The payment for supplies is not permissible until the stores have been received and
surveyed.

EXCEPTION: If in any case, the Administrative Ministry/Administration concerned has

permitted payment on production of a Railway Receipt (DGS&D), the payment will be
treated as an advance against final settlement on receipt of the stores.

The advance payments against Railway Receipts or advance payment to firms for supply of
stores, should be debited to the Suspense Account “Contractors-other
Transactions/Advance Payments” in the Schedule Docket of stock or Work concerned, which
should be cleared by minus debit when the material is actually received.

7) Every RA Bill should be checked arithmetically with reference to previous RA Bill, MBs,
agreement rates before signing and submission of the bill to Divisional Officer for check and
payment. Memorandum of Payments should then be made up, any recoveries which should be
made on account of the work or supply on other accounts being shown therein.
8) Bills which include charges on account of purchase of goods on which Sales TaxVAT has
also been charged should be supported by the certificate signed by the Divisional Officer to
the effect that goods are not exempted and rates are correct/ regular as per agreement.

9) Under section 194-C of the Income Tax Act, 1961 introduced by Finance Act, 1972,
deduction of Income Tax is required to be made at source by disbursing officers from
payments made to contractors in certain cases. Other statutory deductions are also to be made
as applicable.

10) Every page containing the detailed measurements must be invariably scored out by a
diagonal red ink line, and when the payment is made.

11) The number and page of the measurement book in which the detailed measurements are
recorded and the date on which the measurement was made

Matter Relating to Omnibus Transfer Entry Order: The debits or claims on

account of stores acquired for specific works are verified as follows:-

In the indenting sub-division, the receipt of the materials should be recorded in the
Measurement Book after comparing the quantity with the indent received back from the
supplying Division and a certificate to that effect recorded on the indent. Simultaneously the
entry regarding the actual quantity of materials received will be made in the Register of Indents
against the quantity indented. This indent will then be valued with reference to the priced
Vocabulary of Stores and sent to the Divisional Office with the Omnibus Transfer Entry
Order. When the Omnibus Transfer Entry Order is prepared and sent to Division, the
corresponding entries in the Measurement Book should be scored out, giving a reference to the
Omnibus Transfer Entry Order. When the claim is received in the indenting Division, the indent
attached thereto should be verified with reference to the indent received from the sub-division
along with the Omnibus Transfer Entry Order.

12) Payments for work done or supplies made on a running account should ordinarily be
made monthly, in terms of the relevant clauses of the Contract Agreement.

13) Such payments (12) should be treated as payments on account, subject to adjustment in
the final bill which should be drawn, in the appropriate Form (FORM CPWA 27-B) but printed
on yellow paper. In Case of Final Bill the payee has to certify in writing that the payment is
“in full and final settlement of all demands”. ( it does not preclude the disbursing officer from
entertaining a further, bonafide claim omitted from the final bill by mistake or through
inadvertence. If, despite this explanation, the contractor objects to the addition of the words in
question, the payment should be rendered unconditionally)

(14) A separate running account is maintained in respect of each contract.

(15) When secured advances are allowed it should be seen that an Indenture in Form CPWA
31 has been signed by the contractor, and a detailed account of the advances must be kept in
Form CPWA 26-A, the Account of Secured Advances, which should be attached to the Running
Account Bill. These advances must be recovered by deduction from the contractor’s bills for
work done as the materials are used in construction.

(c ) Aid to Contractors
a) It is necessary sometimes, in the interest of work, to engage labourers or contractors or to
incur other liabilities on behalf of the contractor concerned, with a view to complete the work
which he has neglected or failed to complete. In such a case it is permissible to spend
Government funds on behalf of the contractor in accordance with the terms of his agreement.
(This is known as AID TO Contractor)

b) With a view to avoid subsequent disputes with the contractor, suitable intimation should
be sent to him (1) as soon as action is taken under this paragraph and (2) subsequently, as
charges are incurred on his account.

(d) Advance to Contractors

1) Advances to contractors are as a rule prohibited,

2) Following advances are given as an Exception:

(a) Secured Advance:

- A contractor whose contract is for finished work may require as advance on the security of
materials brought to site.

- Divisional Officers may sanction advances upto an amount not exceeding 90% of the value (as
assessed by the Engineer-in-charge or an amount not exceeding 90% of the material element
cost in the tendered rate of the finished item of work whichever is lower) provided that they are
of an imperishable nature and that a formal agreement is drawn up with the contractor under
which Government secures a lien on the materials and is safeguarded against losses.

-Payment of such advances should be made only on the certificate of an officer not below the
rank of Sub-Divisional Officer, that the quantities of materials upon which the advances are
made have actually been brought to site, that the contractor has not previously received any
advance on that security and that all the materials are required by the contractor for use on items
of work for which rate for finished work have been agreed upon. The officer granting such a
certificate will be held personally responsible for any over-payment which may occur in
consequence.

- Recoveries of advances so made should be made from his bills for work done as the materials
are used, the necessary deductions being made whenever the item of work in which they are
used are billed for.

(b) Mobilization Advance:

- In respect of certain specialized and capital intensive works costing not less than Rupees two
crore authorize such advances not more than 10% of the tendered value taking the necessary
precautions for securing Government interest against loss. Such advance shall bear simple
interest at the rate of 10% per annum to be calculated from the date of payment to the date of
recovery (both days inclusive) on the outstanding amount of advance.

- Mobilisation advance should be classified to the respective work.

- Recovery of interest shall be classified under the Major/Sub-Major/Minor Heads of Accounts

“0049-Interest Receipt-03-Other Interest Receipt of Central Govt.-800-Other Receipts”

c) The Divisional Officer has full powers to make advance payments to electric supply
undertakings under the Indian Electricity Act, 1910 for execution of works.

d) An advance payment
(1) Such Advance for work actually executed but not measured may be made with the
previous sanction of the S.E.

(2) the certificate of a responsible officer (not below the rank of SDO) to the effect that not less
than quantity of work paid for has actually been done, (Final payments may, however, in no
case be made without detailed measurements.)

(3) When an advance payment has been authorized by the competent authority, it should be
followed by detailed measurement within two months at the most

(4) the advance being adjusted within three months from the date on which it was made ,
subject to the extension of this period by Director General (Works)/Chief Engineer, in
exceptional case, for reasons to be recorded in writing:-

(i) to four months in respect of advances upto Rs.50,000

(ii) to six months in respect of advances exceeding Rs.50,000 but not exceeding Rs. One lakh.

(iii) Any extension of the period of adjustment beyond the above limits and beyond three
months in the case of an advance exceeding Rs.One lakh will require the previous sanction of
the Government of India.

(5) The grant of a second advance before the first one has been recovered should not be
permitted except in very exceptional circumstances.

Where such circumstances exist and it becomes necessary to grant more than one advance in
succession, the limits imposed above should be held to refer to the aggregate of the advances
outstanding against a particular work at any time and sanctioned to the extension of the period
of their adjustment should be regulated accordingly.
(6) Divisional Officers should submit a monthly statement, in the prescribed form for the
information to the Superintending Engineer concerned giving details of advances made to
contractors for work done but not measured so that clearance may be watched.

IV. Payment to Work-Charged Establishment

(a) Conditions of Employment`

(1) Rules for the entertainment of work-charged establishment are laid down in paragraphs 10 to
11 of the CPWD Code.

(2) Previous sanction of the Divisional Officer or the Superintending Engineer, is necessary
which should specify in respect of each appointment (1) the scale of pay (2) the period of
sanction and (3) the full name of the work and the nature of the duties on which the man
engaged would be employed.

(3) Rules for the grant of leave, gratuity, pension, travelling and other allowances etc., to
members of work-charged establishment are contained in the manuals of the department
concerned.

(4) The leave salaries, travelling and other allowances of members of the temporary
establishment whose pay is charged to works under paragraph 10 of Central Public Works
Department Code are regulated by the rules applicable to temporary establishments.

(5) The Pay and Allowances of WC Establishment borne on regular establishment will be
charged under the functional Budgeted Salary Head of Account.

(b) Pay Bills of WC Establishment:

(1) Wages of members of the WC establishment should be drawn and paid on Form CPWA
29, “Pay Bill of Work-Charged Establishment” which is combined pay bill and acquittance
roll form. (FCR)

(2) A consolidated bill in this Form should be prepared monthly either for the whole sub-
division or for one or more sections of it, as may be convenient,

(3) Names should be grouped in the bill by works on which the are employed, sanction to the
entertainment of the establishment should be quoted in each case, and the SDO should certify
that each man being employed on the work for the period and on the duties for which his
appointment was sanctioned.

(4) If the acknowledgement of an individual cannot be obtained on the bill itself, it may be
obtained separately on a Hand Receipt, Form CPWA 28, which should then be attached to
the bill as a sub voucher.

(5) Pay bills may be signed at any time not earlier than five (5) days before the last working
day of the calendar month for which such pay and allowances are earned and shall be due for
payment on the last working day of that month.
(6) In the case of WC staff attached to Sub-Divisions located away from the Head quarters
of the Divisional Office, monthly pay bills may be signed not earlier than the 15th of the
month to which the pay and allowances relate. The same will be prechecked by the Divisional
Accountant and passed by the Divisional Officer of the Division concerned well in time so as to
arrange payment on the last working day of that month.

(7) Adjustments, if any, between the pay and allowances actually admissible for each month and
those already drawn should be positively made at the time of actual disbursement or in the
next month.

(c) Unpaid Wages (WC Staff)

(a) Items remaining unpaid on the monthly bill should be entered in a simple register, full
particulars of the charge, including reference to the bill, being noted in the Register. Form
CPWA 21-A suitably modified, if necessary, may be used for this purpose.

(b) Subsequent payments should be made on Hand Receipts, Form CPWA 28, reference to
the bill in which the charge was originally included, and to the particular item thereof, being
quoted in each case.

(c) When making payments of arrears suitable notes of payment should be so recorded against
the original entries in the Register, as to guard against second payment.

(d) Travelling Expenses (WC Establishment)

(1) No bills need be prepared in support of claims for traveling expenses.( in r/o work-charged
establishment whose traveling allowance is determined with reference to the provisions in
Supplementary Rules, TA Bills in Form GAR 14A should be prepared.)

(2) Payments should be made on Hand Receipts, Form CPWA 28 which should set forth all
the necessary particulars of the journey performed and of the expenses claimed and should be
countersigned by the Divisional Officer prior to payment.

(e) Classification of Charges(WC Establishment)

(1) Every payment made to a member of the work-charged establishment whether on account of
his wages or in recoupment of actual traveling expenses should be debited to the work on
which he is employed.

(2) However in respect of Work Charged Establishment borne on regular establishment,

such charges shall be debited to the functional Budgeted salary Head of Account.

10.3 ISSUE OF MATERIALS( Stock Charges)

I. General
1) Issues of materials to works, whether from stock/by purchase transfer/ manufacture
are divided into two classes:-

(1) Issue to Contractors:- Issues of materials to contractors with whom agreements in respect
of completed items of works i.e., for both labour and materials have been entered into.

(2) Issue Direct to Works:- Issue of materials when work is done departmentally or by
contractors whose agreements are for labour only.

II. ISSUE OF MATERIALS TO CONTRACTORS

(a) General Conditions

10.3.2(a) The issue of material to contractors who have contracted for completed items of work,
is generally permissible only

(i) When as per CPWD Code it is necessary to retain in the hands of Government the supply
of imported materials.

(ii) When, in the interest of work, or

(iii) with the object of utilizing existing stocks of materials, it is desirable to retain in the
hands of Government the supply of certain other materials as well, and a condition to this
effect has been inserted in the contract.

(b) In both cases the contract should specify

(1) the materials to be supplied by Government for use of the work

(2) the place or places of delivery and

(3) the rates to be charged to the contractor for each description of material;

(c) the contractor should be held responsible for obtaining from Government all such
materials required for the work and for making payment therefore, by deduction from his
bills at the rates specified regardless of fluctuation in the market rates or in the stock rates of the
division.

(d) The rates to be charged to the contractor for materials to be supplied should be definitely
specified (vague quotations, e.g., “at stock rates” being avoided)

(e) Where the contract provides for the payments for work done to be made at a specified
percentage below or above the rates entered in the sanctioned estimate of work (or the
Schedule of Rates),

it should be stated in clear terms in the contract that the deductions or additions, as the case
may be, of the percentage, will be calculated on the gross (and not the net), amounts of the
bills for work done, and in fixing the percentage it should be borne in mind that the calculations
will be so made.

(f) No carriage or incidental charges are borne by Government for moving the materials
beyond the place where the contractor has agreed to take delivery thereof.

(g) In r/o Contract where supply of materials from govt stock is not stipulated:

If the contractor desires the issue to him, for use on a work of materials which exist in
Government stock, the material should not be issued except with the express authority of the
Superintending Engineer who should specify in each case the rate to be charged. EE is
required the furnish the recovery rate and reasons for such contingency.

RECOVERY RATE TO BE CHARGED (THREE RATE FORMULA)

(i) Recovery Rate for such non-stipulated materials will be Higher of following three rates:

- Rate as provided in the AR for the item of work on which it would be used plus or minus the
percentage above or below the Schedule rate allowed to the Contractor

{ i.e. (Basic Rate as adopted in AR (Agreement Item) + 7.5%%) X Percentage of the rate quoted
for that particular item bears to the estimated rate of that item.}

- OR Market Rate

- OR stock issue rate plus storage charges

(No carriage or incidental charges should be borne by Government in connection with the
supply.)

(ii) Working out AR of Rate In case of non-scheduled rate item:

The Current Market Rate OR Rate asper DGS&D Rate Contract of constituent item is adopted
for working out Analysis of Rate.

(iii) Where the finished item in which the materials to be used is available in the agreement,

For working out AR for the three rate formula, following analysis is adopted.

(Basic Rate as adopted in AR (Agreement Item) + 10%) X Percentage of the rate quoted for that
particular item bears to the estimated rate of that item.)

(iii) Where the finished item in which the material is to be used is not available in the
agreement or where it’s rate is delivered according to clause 12-A of the agreement,

The element of rate for the material taken in the AR of the item should be considered while
applying the three rate formula.

Note
(a)The intention of this rule is to prohibit the supply of materials to contractors with the object
of giving them financial aid,

(b) In case of unavailability of stipulated materials: The supply must be arranged by the
Divisional Officers by purchasing the materials from other sources and then supplied to the
contractor at the stipulated rates.

(c) Issue of Stock materials to contractors for bonafide use on works are exempt from the
usual charge of 10 per cent on account of supervision and contingencies, (which is
applicable when stock materials are sold to the Public)

(b) Accounting Procedure (for materials issued to contractor)

1) All materials required for issue to a contractor, should be made over to him on a regulated
scale and restricted to actual, immediate requirement whether from stock or by purchase,
manufacture or transfer, and

2) An unstamped but dated acknowledgement (USR), should at once be taken from the
contractor.

3) The issue of materials should simultaneously be entered in the Account of Materials issued to
contractors, Form CPWA 35-A (MAS).

4) When the materials are obtained by purchases, full details of the articles received should at
once be entered in a Measurement Book, Form CPWA 23,

5) On the authority of the contractor’s acknowledgement, the cost recoverable from him should
be debited at once to his personal account by charge to the suspense head “Contractors –
Other Transactions (COT)” in the account of the work concerned.

This adjustment should be affected by affording credit to the head concerned, as indicated
below

Source or receipt of

material

Head of Account to be

credited

Value to be credited

123

1. Stock (including

manufacture)
Stock At Issue rates

2. Transfer from another

work

(i) When issued direct to

work.

(ii) When issued to

contractor

Work concerned

Contractors other

Transactions of the work

concerned

At a valuation made under

para 10.3.13 (c )

Issue rates as per

Agreement of the work

concerned

3. (a)Transfer from one

Division to another

Division

Transfer would be on the

basis of Sub-head “Stores

Advance” under the

Budgeted Minor Head

“799 – Suspense” below

the functional Major/Sub-

Major Heads of Account

or under Sub-head “Work

Advance” under Work

concerned

At rates charged by the

concerned Supplying

Division

4. Supplier Major Head “8658 –

Suspense Accounts Minor

Head” 129 – Material

Purchase Settlement

Account Suspense” if the

Payment has not been made

in the same month in which

the stores have been

At rates payable to

Suppliers under their

contracts

5. Obtained from abroad -do- The cost determined vide

Rule in Appendix 6

109

6. Indian Charges(5) Head concerned Actual charges incurred

vide Rule 4 and 5 in

Appendix 6
If the amount thus credited differs from the charge made to the contractor’s account, the excess
of the former over the latter should be treated as additional final outlay (plus or minus, as the
case may be) on the work.

(c ) Return of Surplus Materials

1) Stores supplied by Government – all stores/materials so supplied to the contractor or
procured with the assistance of the Government shall remain the absolute property of
Government and the contractor shall be trustee of the stores/materials so supplied procured
and the said stores/materials shall not be removed/disposed of from the site of the work on any
account and shall be, at all times, open to inspection by the Engineer-in-charge. Any such
Stores/materials remaining unused shall be returned to Engineer-in-charge at a place
directed by him

2) Surplus materials originally procured by the contractors for themselves:

This can also be taken over by the Government, if required for use on other work in progress,
only on special arrangements and at the prevailing market rates.

(d) Tools and Plant lent for use

Articles borne on the T&P Account of the division may be lent temporarily to contractor for
use on Government works being executed or maintained by them. The hire charges of such
Tools and Plants count from the date these are taken out from Departmental workshop or specific
place till the date of their return. See also paragraphs 7.3.3 and 7.3.7.

“III ISSUE OF MATERIALS DIRECT TO WORKS”

A. Original Works

(a) Detailed accounts of materials issued

10.3.11 (a) In all cases, materials issued direct to a work should, as soon as received, be brought
to account as indicated below:-

The full value credited to head concerned should be debited to the work (paragraph 10.3.12) and
the quantities entered in the Register of Materials-at-site Account Form CPWA 35.

(b) In the case of materials received direct from suppliers, full details of the articles received
should at the same time be entered in a measurement book, Form CPWA 23, with the full name
of the work as entered in the estimate, vide paragraph 10.2.8(e).

10.3.12 (a) when materials are issued direct to a work either for work to be done departmentally
or through contractor on labour rates, their cost is “debited to the Suspense head “Materials” in
the account of work.
(b) A detailed account of item of materials showing the receipts, issues and balances, should be
kept in Form CPWA 35, so that the total issues of each items may be watched with reference to
the estimated requirements.

(b) Disposal of Surplus Material

10.3.13(a) Materials issued to works in excess of requirements may be transferred to stock,

provided that they are serviceable and certain to be required.

(b) All surplus materials at site of works, which have been completed or stopped or on
which outlay has been prohibited for any considerable length of time, should be

- transferred to other works in progress or

- brought on to the stock Account, Form CPWA 73

(their value being credited to the work to which they were originally issued and debited to the
work to which they are transferred or to the stock Account, Form CPWA 73, as the case may be.

(c ) Materials returned to stores or transferred to other works should be priced within

current market rates,

- any resultant loss being borne by the work to which they were originally issued, and the
disposal of materials being shown in the materials-at-site account also.

(d) The loss by the disposal of surplus materials at less than the book value

It should be debited to the work for which the stores were originally purchased.

Note – These rules do not apply to surplus materials

- which were originally procured by contractors for themselves or

- were issued to them and charged off to their accounts under paragraph 10.3.4. See also
Paragraph 10.3.9.

(c ) Verification of unused Balances

1) Unused balances of materials charged direct to works should be verified at least once a
year. A report of verification of the materials should be prepared by the SDO and submitted to
the Divisional Office.

Note – The rules in paragraphs 7.2.34 and 7.2.35 regarding verification of stock apply mutatis
mutandis to verification of materials at site of works

with the EXCEPTION that the value of materials found in excess and recoveries of
shortages/losses, if any, should be credited to the appropriate sub-head(s) of the work.
10.3.15 A similar verification of the unused balances of materials must invariably be made on
the completion of a work, but on or before the completion of a work, when no more materials are
required for use in construction, steps should first be taken to dispose of all surplus materials by
transfer or sale, so that

(1) the accounts of the work may promptly receive such credits as may be admissible under
paragraph 10.3.13.

(2) the balance at debit of the suspense head “Materials” may, as far as possible, represent
the net cost of the materials actually used in construction and

(3) the surplus balances awaiting clearance may be reduced to a minimum (vide note below
paragraph 10.3.14).

10.3.16 If the gazetted officer or subordinate in direct charge of a work, the accounts of
which are kept by sub-heads, is transferred before the accounts of it are closed the unused
materials at site of the work should be verified by the relieving officer, in company with the
relieved officer, and the report prescribed in paragraph 10.3.14 should be prepared by the Sub-
divisional officer and submitted to the Divisional Office.

10.3.17 The physical verification of unused materials under each item with the balance
shown in Form CPWA 35 should be made annually in respect of all works, the accounts of
which were opened on the last day of the financial year, but it is not necessary (in following
cases) that the balance should be verified at the close of the year, if:-

(i) the work has been under construction for not more than three months

(ii) the accounts of the works are expected to be closed within three months or

(iii) the balances were verified at any time during the year.

10.3.18 After the completion of a work, materials issued by the Department, theorectical
calculations of all the items of materials used on the work should be made in the Register
showing the clearance of Suspense head “Materials”, Form CPWA 38, and compared with the
quantities issued as per Form CPWA 35.

On the basis of theoretical calculations, the sub-head “Materials” should be cleared by

debiting the cost of materials to the work

- at the standard issue rates or

- the market rates (in the case of items not borne on the stock of the Department) prevailing at
the time of completion of the work; any plus or minus balance will be borne by the work.

B. Repair Works
- For minor repair works done departmentally:- An MAS account, Form CPWA 35 should
not ordinarily be kept, as control on the issue of materials can conveniently be exercised in
such cases.

But, if there is an accumulation of materials for a number of works, an account may be

maintained.

10.4 ADJUSTMENTS through TEs

In addition to cash payments and issues of materials, there are other transactions relating to the
accounts of works, which are of the nature of adjustments usually recorded in the Transfer
Entry Book in the Form C.A.M-34 of the Divisional Office.

10.5 WORKS ABSTRACT (Form-33)

I. Introductory
a) An account of all the transactions relating to a work during a month whether in respect of
cash, stock or other charges, in respect of estimates.

b) It exhibits the accounts broadly under following three categories

1) Final Charges (it includes and exhibit separately charges for materials issued to
Contractors/ Direct to Works i.e work taken up departmentally or through labour contract),

2) Suspense Charges and

3) Contingencies.

The category “Suspense Accounts” will contain the following “Suspense Transactions”.

1. Contractors

(i) Advance Payments

(ii) Secured Advance

(iii) Other Transactions

2. Labourers

3. Materials

4. Land Acquisition

c) PETTY WORKS (i.e., costing not more than Rs.5000/- each):

- The estimate, account and completion certificate of such work should be prepared on a
single form, Petty Works Requisition and Account, Form CPWA 32, and
- Separate Works Abstract are not necessary.

d) Percentage Charges on account of Establishment, Tool and Plant, Accounts and Audit
and Pensionary Charges levied on works Expenditure:

- This charges should not be shown in Works Abstract and Register of Works, (Form
CPWA 40),

- they are eventually included in the cost of works through Schedule of Works Expenditure
(Form-64 of Monthly Account)

d) Ordinarily there should be one Works Abstract monthly for each working estimate,

but if the estimate is for a large work which is divided into several subworks, it will usually
be found convenient to prepare a Works Abstract separately for each sub-work.

II. CLASSIFICATION AND RECORD OF FINAL CHARGES

(a) Estimates (Abstracts & Sub-Heads)

1. The Division of an Estimate into sub-heads for the purpose of accounts is guided usually by
the classification sanctioned in the abstract of the estimate.

Example:

(i) Abstract of Estimate relating to purchase or supply materials and to employ labour for
construction separately (whether by contract or by departmental agency):

It will carry following distinct Sub-Heads (1) the cost and quantity of “labour” and (2) the cost
of materials

(ii) Abstract of Estimate when any item of work is to be executed by contract (for the
completed items of work):

It may show merely the quantity and cost of each item of work

2) Miscellaneous charges of a general nature not pertaining to any distinct sub-head:

These may be treated as separate sub-heads, being grouped under one or more heads, e.g.,
“Work-charged Establishment”, “Contingencies”,

3) If the number of sub-heads in the working estimate for a work or sub-work is large:

it is permissible to break up the estimate into two or more parts, and to treat each part as
sub-work for the purposes of accounts; but no part of an estimate can be separated from the rest.

4) Following THREE MATTERS may be seen from account of the work in the Works
Abstract:-
i) “amount” i.e., total charges finally classified under the relevant categories, and

ii) percentage of the progress of work compared with the amount technically sanctioned and
time allowed.

iii) “rate of cost”, i.e., cost per unit on the basis of the recorded “amount” and “progress”.

5) The charges classified under a final sub-head should include all ordinary expenses
incidental to construction.

If any part of a work is pulled down and rebuilt to any serious extent, the extra charge for
construction should ordinarily be debited to the sub-head concerned under the terms of his
agreement. But if the amount involved be so large as to affect sensibly the cost or rate of the
sub-head, it may be debited to the sub-head “Contingencies” instead or, with the sanction of
the competent authority, to a new sub-head additional to the original sanctioned subheads of the
estimate.

6. In the accounts of Major Estimates, under final charges entitled “Additional charges for
Materials issued to Contractors/Direct to Works”:

This Sub-Head should be opened for the record of under-mentioned debits/credits.

i) Difference between the rates charged to the contractors (Stipulated Rate in Contract) and
the actual cost to Government (Issue Rate)

ii) Carriage and incidental charges in connection with the materials issued to contractors, if
under paragraph 10.8.1 are chargeable to the work.

iii) Balances outstanding under the suspense head “Materials” after transferring the cost of
material to the final heads

III. SUSPENSE ACCOUNTS

(a) General
In addition to the head “Final Charges”, a few suspense accounts are opened in works Abstracts
to record transactions of a temporary character which are either not adjustable as final outlay in
the accounts of the works concerned or the correct classification of which cannot be determined
immediately. These accounts are:-

(1) “Materials – for the record of the cost of materials issued direct to work (through
stock/purchase/ manufacture/ transfer etc), either executed departmentally or through a
Contract for labour only.

(2) “Contractors – Advance Payments” – for the record of advance payments and of their
recoveries
(3) “Contractors – Secured Advances” – for the record of secured advances and of their
recoveries

(4) “Contractors – Other Transactions” – for the record of all other debits or credits to
contractors awaiting settlement.

(5) “Labourers” – for the record of unpaid wages of labourers and of their subsequent payment,
not that of “Work-Charged Estimated”, and

(6) “Land Acquisition” – for the record of Advance payments to the Land Acquisition Officers
and of their subsequent adjustments.

(c ) Contractors and Labourers Account

(i) The head “Contractors – Other Transactions” is intended also for watching the ultimate
payment of the unpaid balances of contractors accounts.

(ii) The head “Labourers” is meant for the clearance of the unpaid wages of labourers.

If a Running Account Bill or Muster Roll is only partly paid, the total amount due thereon as
value of work done or supplies made should be brought to account in the Works Abstract as
final charges and the amount remaining unpaid should be shown as a minus entry in the
appropriate suspense column – “Contractors – Other Transactions” or “Labourers”.

(iii) If any wages of labourers remain unpaid after the completion of a work:

- The accounts of the work may be kept open for a period of one month, which may be
extended to three months at the discretion of the Divisional Officer. Thereafter, the accounts
of the work should be closed, the balance under the suspense head “Labourers” being left
unadjusted.

- This unpaid amount should be shown in any Completion Report or Statement, (Form
CPWA 45) as a liability against the work and

- It should be excluded from the total expenditure on the work, so as to arrive at the amount
actually brought to account.

- If unpaid wages of labourers are claimed and paid subsequently to the closing of the
account of a work, the payment should ordinarily be charged against a fresh estimate under the
same head of service as the original work.

(iv) The accounts of a contractor should be closed as soon as his contract is completed. If he
does not take final payment for more than one month after the final bill has been passed, a
note to this effect should be recorded on the bill, the amount of the work as passed on the bill
should be incorporated in the Works Abstract on the authority of the bill and the balance due
to him should be removed from the accounts of the work by credit to the Minor head “ 108-
Public Works Deposits” below the Major Head “8443-Civil Deposits”.
-If the final account of a contractor shows that he has already been overpaid or that the
account closes with a balance due by him, the account should be settled by a recovery in
cash or otherwise, but if an immediate recovery is not practicable, the balance should be
removed by debit to the sub-head “Miscellaneous Works Advances” under the Major Head
“799-Suspense” below functional Major/sub-Major Heads of Account.

(d) Land Acquisition Accounts

(i) Advance payments made by the Divisional Officers to the Land Acquisition Officer under the
revised procedure for the adjustment of the land acquisition charges will be debited directly to
the suspense account, “Land Acquisition” within the Works Accounts till the possession of
land is received or intimation of actual payment to the owners of land is received.

(ii) This suspense head will be cleared by the Divisional Officers on receipt of the accounts
along with the Land Award Statements, vouchers etc. from the Land Acquisition Officers,
by debit to the final head “Acquisition of Land” in the accounts of work.

(iii) Any balance of the advance should be refunded by the Land Acquisition Officers along
with the accounts. Award statements etc and credited to the suspense head “Land
Acqusition”.

(iv) If there is any delay in the land acquisition proceedings and final payment of
compensation etc.,

(v) The accounts of work can be closed leaving the amount under suspense account “Land
Acquisition” unadjusted as in the case of suspense account “Labourers” in the account of
work, and may be reopened in case refund has to be made or some further amount has to be paid.

(vi) Adjustments of outstanding amounts, if any, after the closure of the accounts of
workshould be watched through a separate register.

IV Liabilities Awaiting Incorporation

- Liabilities are not incorporated in the accounts of works,

EXCEPTIONS:

(a) Unpaid balances of partly paid running account bill or muster rolls are invariably
incorporated (Labour & COT Sub-Heads).

(b) (Credit Purchase of Materials from outside sources) The value of materials received
from sources other than stock (including manufacture), whether for issue to contractors or for
issue direct to works is at once brought into the accounts of works even though payments to the
suppliers and adjustments crediting the transfer accounts concerned, may not be made at once
and

(c ) Wholly unpaid muster rolls and bills of contractors and suppliers are sometimes taken to
account.
V. PREPARATION, COMPLETION AND DISPOSAL OF WORKS ABSTRACTS

a) The Works Abstract should be prepared in the divisional office.

b) It should be posted day by day from the Cash Book and the connected bills of contractors
and suppliers,

c) Cash Refunds and Readjustments of final charges being posted as minus entries.

d) At the end of Month, Stock and adjustment transactions should be added, write back
final charges being posted as minus entries.

e) The closing balances of contractors accounts under the suspense heads (1) “Contractors –
Advance Payments”. (2) “Contractors – Secured Advances”, and (3) “Contractors – Other
Transactions” should agree with the balance as per the ledger accounts of the contractors in
respect of that particular estimate/work.

f) The closing balances under the suspense head “labourers” in each case should be agreed
with the connected Register of Unpaid Wages.

(g) When finally completed and certified by SDO, all the Works Abstract of a month should
be examined and initialed by the Divisional Officer.

10.6 Registers of Works

1. Forms of Registers of Works and their preparation(Form-CPWA-40)

(a) The permanent and collective record of the expenditure incurred in the division, during a
year, on each work is the Register of Works. This record is maintained in the Divisional Office,
in Form CPWA 40.

(b) In respect of petty works, no record is necessary EXCEPT the Petty Works Requisition
and Account, Form CPWA 32, which is self-explanatory.

(c)The Registers of Works are posted monthly from Works Abstract.

(d) Only the figure of expenditure against entry ‘A’ will be posted in the register of works.

(e) The Contractor Ledger Form CPWA 43 will take care of all the suspense heads including
additional charges for material and labourers.

(f) A separate folio or set of folios of (Register of Works) Form CPWA 40 should be assigned to
each Estimate.

(g) The transaction relating to each Schedule Docket should be posted separately and an abstract
for the entire work should be prepared on a separate folio or set of folios for comparing the
cost of the work and with the provision in the estimate. The following instructions should
receive special attention:-
(i) The Register of Works is not a classified account of works. For facility of reference it should
be supplied with an index which should be sub-divided under the prescribed heads of
account classification.

(ii) The sanctioned/additional amount of estimate/supplementary estimate should be entered

in respect of each work. Both are to be totaled.

(iii) But when a revised estimate is sanctioned, the account of the original estimate should be
closed and the revised estimate should be entered on a fresh folio, prominently marked
“Revised Estimate” in red ink, and a reference to the folio on which the original estimate is to be
found should be entered thereon.

(iv) In the case of works for which specific appropriation are sanctioned individually, the
amount of appropriation for the year should be noted in the Register at the top of the page,
any additions or deductions made during the year being noted in the same place.

II. Examination of Register of Works by Divisional Officer

(a) The posting of the Registers of Works, Form CPWA 40 should be completed Before the
date of submission of the monthly accounts to the Pay and Accounts Officer, and the Registers
should then be laid before the Divisional Officer for review.

(b) Actual, as well as, probable excesses, whether in the total cost of a work or in the rate of
cost should receive special attention, and works slips in Form CPWA 39 should be prepared
and submitted to the Superintending Engineer.

(c) If the transactions of a division are very large, the Divisional Officer may allow an extra
period of a few days for the completion of the Register of Works, but the submission of the
monthly accounts to the Pay and Accounts Officer should not be delayed on this account.

III. Closing The Accounts on Completion of Work

(a) Settlement of Liabilities and Assets and clearance of Suspense Accounts.

(i) It is an object of great importance to close the accounts of works as soon as possible after
the actual work of construction is completed

(ii) Before the account of work can be closed on its completion: it should be seen that

- Necessary adjustments of cost have been duly made in the “Land Acquisition” accounts

- All liabilities not originally brought to account have either been liquidated or since brought
to account and

- The balances under the suspense accounts “Contractors”, “Labourers” and “Land
Acquisition” have been cleared.
- If the whole or any part of the expenditure on the work is recoverable from another
department, Government Local body or individual, action should be taken to effect or
complete the necessary recovery before the accounts of the work are closed.

(iii) The accounts of annual maintenance estimates:

- It must be closed in the month fixed by the Administrative Ministry/Administration

concerned.

- Ordinarily, it should be possible to complete all the repair works and to settle the accounts of
contractors and other suspense accounts, before the expiry of the working year.

- If, in any exceptional case, any work remains to be done and, it is proposed to carry it on
to completion, action should be taken as under:-

(1) The expenditure incurred in the next working year should be treated as expenditure
against the annual maintenance estimate for that year.

(2) The suspense accounts of the work should be closed in the last month of the working
year, by transferring the balances of all those accounts to the general suspense accounts
“Public Works Deposits” or “Miscellaneous Works Advances”, as the case may be,

Thereafter above Suspense Accounts should be relieved in the following month by

transferring the balances to the suspense account concerned in the accounts of the
maintenance estimate for the next working year.

(3) All unsettled liabilities and assets should then be treated as those pertaining to the next
working year’s estimate.

(b) Losing entries and review of expenditure

(a) When the work is completed and the accounts of it have been settled

- a double red ink line should be ruled below the final entries and a note made in red ink
“Work completed in ……20”.

This note should be signed by the Divisional Officer.

(b) If it is a Deposit Work, steps should be taken promptly to surrender the unexpended
balance, if any, of the deposit with the approval of the Divisional Officer.

(c ) Excesses over estimates.

(i) Excesses passed by Divisional Officer

If the total expenditure on the work is in excess of the sanctioned estimate and the excess is
passed by the Divisional Officer under his power, the words “Excess passed by me” should
be added to the completion note recorded..
(ii) Completion Reports and Statements
If, however, the excess is not within the Divisional Officer’s powers:

- A Detailed Completion Report in Form CPWA 44 should be prepared OR

- The items should be included in a consolidated Completion Statement of Works and Repairs
in Form CPWA 45.

The completion note in the Register of Works should then be amplified thus: “Work completed
in ….20 Completion Report statement submitted with this office letter No. dated 20”.

The orders passed subsequently by higher authority on the excess reported in the Completion
Report or Statement should also be noted in the Register of Works, Form CPWA 40 to complete
the record.

IV. Correction of Errors After Closing of Accounts

The accounts may be reopened in order to rectify the error or omission unless the amount
involved is not more than ten rupees in which case it will be sufficient to make a note of the
error or omission in the relevant documents concerned.

V. Schedule of Rates
10.6.13 To facilitate the preparation of estimates, as also to serve as a guide in settling rates in
connection with contract agreements, a schedule of rate for each kind of work commonly
executed be maintained in the division and kept up to date. It should be prepared on the basis
of the rates prevailing in each locality and necessary analysis of the rates for each description
of work and for the varying conditions, thereof should, as far as may be practicable be recorded.

The rates entered in estimates should generally agree with the scheduled rates but where, from
any cause, the latter are not considered sufficient, the deviation should be explained in detail in
the report on the estimate.

10.7 CONTRACTORS’ LEDGER

(Apply to all transactions with contractors in connection with contracts or jobs undertaken by
them, whether relating to the execution of works or to the supply of materials for work or
stock).

1. Form and Use of the Ledger

a) The Accounts relating to contractors should be kept in the Contractors’ Ledger, Form CPWA
43,

b) A separate folio or set of folios being reserved for all the transactions with each contractor
for whom a personal account is maintained.
c) A personal account should be opened in the ledger for every contractor, whether or not a
formal contract has been entered into with him.

d) If only materials are issued to the contractor or any payments are made on his behalf, a
ledger account must be opened.

e) A Ledger A/c is not opened when the work or supply entrusted to him is not important
and no payment is made to him except on a First and Final bill, Form CPWA 24, on
completion

II. Posting the Ledger

a) The Contractor’s Ledger, Form CPWA 43 should be written up in the divisional office. It is
not necessary for the sub-divisional Officer to maintain a similar ledger in his office, but if he
maintains one, the divisional office may not require him to furnish extracts therefrom.

b) [Except when a contractor’s account is to be closed and the procedure is observed in respect
of unpaid bills] the value of work done or supplies made by a contractor should not be
credited to his account until his bill has been passed and payment made thereon.

c) Debit entries in the Ledger should be made only on the basis of transactions recorded in
the accounts, the posting being made from the supporting cash, stock or adjustment vouchers,

d) Liabilities not yet liquidated should be excluded altogether

e) Security deposits of contractors should not be included in their personal accounts in the
Ledger.

f) The form of the Contractor Ledger provides for the following columns “-

Particulars of Bills or Voucher.

1. Date

2. Voucher Number

3. Serial Number, if a running account bill.

Net Transactions detailed by suspense heads:

4. Advance Payments

5. Secured Advances

6. Other Transactions

7. Name of work or Account and Particulars of transactions.

Gross Transactions:-
8. Debits

9. Credits

10. Total value of work or supplies

11. Remarks.

(g) Columns 8 and 9 (Debits & Credits) constitute the ledger account proper

(h) Columns 4, 5 and 6 (Adv Pay/ Sec. Adv & COT) set forth the net effect of each posting
on the three suspense heads making up the account.

(i) Column 10 (Total value of work or supplies) is also not a part of the personal account,
but will be found useful for the purpose of exercising a check over the continuity of bills in
the case of running accounts.

(j) Columns 1 to 3 (Date/ Vr. No/ RA Bill No) and 11(Remarks) require no explanation.

(k) Column 4 – “Advance Payments – If the bill is Running Account Bill (Form CPWA 26),
“figure D” of the Memorandum of Payments should be posted in this column.

(l) Column5 – “Secured Advances” – figure ‘E’ of the Account of Secured Advances, Form
CPWA 26-A should be posted in this column.

(m) Column6 – “Other transactions” – In the case of running Account Bill, figure “G” of the
Memorandum of Payments should be posted in this column. (If a payment is made on a first
and final bill, Form CPWA 24, no entry should be made in this column unless a recovery is
made from the contractor on any account). In the case of transactions other than these, the
amount paid or recovered should be entered. The amount of the advance made under paragraph
10.2.18 should be posted in this column.

(n) In columns 4, 5 and 6

Debits (Payments) to contractors should be posted as plus entries and credits (Recovery) as
minus entries.

(0) Column 8 – “Gross Transactions – Debits” – If it is a Running Account Bill, figure H of

the Memorandum of Payments should be posted in this column; otherwise, the total amount
paid or chargeable.

(vii) Column 9 – “Gross Transactions – Credits” – Here should be entered the value of work
or supplies creditable to the contractor, which will be figure F of Account I in the case of
running Account Bill.

(viii) Column 10 – “Total value of Work or Suppliers” – In the case of Running Account Bill,
here should be entered the total value of work done or supplies made upto date, as per figure
A of Account I of Bill, but before posting the bill it should be seen that the figure shown in
Account I of it as “Deduct value of work shown on previous bill” agrees with the last entry in
column 10 of the ledger against the work concerned. In token of this check, this last entry in
column 10 should be initialled (and dated) by the Divisional Accountant.

III. Balancing and Reconciliation

a) The ledger accounts should be closed and balanced monthly.

b) The closing balance of each personal account should the amount outstanding, if any, under
each of the three suspense accounts, (I) Advance Payments, (2) Secured Advances and (3) Other
Transactions

c) The Divisional Accountant should ensure the correctness of the Contractor’s Ledger,Form
CPWA-43

IV. Scrutiny of Accounts by Contractors

a) A contractor requiring a copy of his running account bill or an extract from his account
in the Contractors’ Ledger, Form CPWA-43 should be furnished with the same.

b) He should be encouraged to look at his account in the ledger and sign it in token of his
acceptance of it.

Separate ledger (Form 43A) for work (deptt/ labour contract & land
acquisitions)
The Account relating to issue of material direct to work when contract is of labour or the work is
to be done departmentally and also for land acquisition (10.5.21), the ledger will be maintained
in Form CPWA 43-A. This form provides for the following columns:-

1. Date

2. No. of Voucher/Indent No.

3. Sr. No. if a Running Account Bill

4. Net Transactions detailed by Suspense head

5. Material

6. Labour

7. Land Acquisition

8. Name of the Work Account and Particulars of the Transactions

9. Gross Transactions
10. Debits

11. Credits

12. Total value of Work done

13. Remarks

10.8 SUNDRY RULINGS

I. Carriage & Incidental Charges

10.8.1 (a) The cost of carriage of stock materials to site of works, and of all carriage charges, in
connection with the movement, from place to place, of other materials issued to or provided
specially for a work, should be debited to the account of the work, the exact classification of
charges being as indicated below:-

Nature of issue of Material Head chargeable in the account of the work

I. Issue to Contractors under para 10.3.2

a. To the promised place of delivery

“Final charges” in the case of work executed

departmentally or through Contract for labour only and

“Additional Charges” for materials issued to

contractors/Direct Work, in the contracts where the

supply of departmental materials are stipulated

b. Beyond the place of

delivery, if incurred

The personal account of the contractors under the

suspense head “Contractors-Other Transactions”

2.Issue of contractors to under

para 10.3.3

-do-

3. Issue Direct to works Final Charges/Materials, as the case may be

(b) When surplus materials are returned from a work to stock, the cost of carriage should be
borne by the work,

but if they are transferred to another work, the charge may be debited to either work as
may be equitable.

(c ) Incidental charges connected with the movement of materials issued to or provided

specially for a work or returned therefrom should be adjusted in the same way as the cost of
carriage.

(d) In all cases, the places from and to which materials are conveyed, the distance, the
quantity and the approximate weight must be stated clearly in the payment vouchers.

II. Charges for Examination of Soil

10.8.2 The expense attendant, upon the necessary examination of the soil for the foundations
of works ordered by competent authority should be treated as outlay on works and not as a
contingent charge, provision for it being made under the service head concerned in a requisition
or estimate according to the sum involved.

III. Expenditure on Inauguration Ceremonies

10.8.3 The expenditure incurred with the sanction of competent authority on ceremonies
connected with the inauguration of important public works should be debited:-

(a) In the case of irrigation projects (Commercial), to the revenue account of the project, and

(b) in the case of other works, to the contingencies of the sanctioned estimate.

IV. Rates and Taxes on Buildings

10.8.4 Municipal or other rates and taxes on Government buildings shall be adjusted in the
manner laid down in Government Accounting Rules, 1990.

V. Execution of Works by Other Departments

10.8.5 Whenever the maintenance of any works under the administrative control of the
Public Works Department is entrusted to the agency of another Civil Department with the
sanction of Government, the rules of procedure applicable to expenditure connected with the
work will be such as may be laid down by the Administrative Ministry/Administrator concerned
in consultation with the Chief Controller of Accounts, subject to the following reservations:-

(1) The Civil Department should be responsible to the Public Works Department to account
for appropriation placed at its disposal.

(2) The Public Works Department should retain budgetary and financial control

(3) The Public Works Department should retain technical control through inspection.
VI. Execution of Government Works by Local Bodies
When the Public Works Department entrusts to the agency of a District Board, or other
local body, the maintenance of Government buildings or roads, without transferring the
property to the local body:

a) The payment made to it on this account should be treated as a payment for work done by
a contractor.

b) If lump sum payments have been agreed upon, the procedure for settling the account
periodically, and for recording the cost of the works, may be simplified, with the concurrence
of the Chief Controller of Accounts provided:-

(i) that a certificate that the work has been done in accordance with the conditions agreed
upon is placed on record by a responsible official;

(ii) that if the payment is made for a number of works expenditure on all of which cannot be
classified in the accounts under a single head of account, the necessary detailed classification
of the charge is set forth and

(ii) that, as far as possible, the liability of a year is settled within that year.

VII. Scope of Sanction

The authority granted by a Sanction to an estimate is strictly limited by the precise objects
for which the estimate was intended to provide.

Accordingly it is not permissible to apply, without the sanction of the competent authority, any
anticipated or actual savings, whether due to the abandonment of a part of work or to any other
cause, on a sanctioned estimate of a definite project, to carry out additional work not
contemplated in the original project or fairly contingent on its actual execution. However, subject
to the availability of funds under sub-head “Contingencies” in the sanctioned project estimate,
and subject to the acceptance of the Engineer-in-Chief, such additional works not contemplated
in the sanctioned project, may be executed by the Divisional Offices.

CHAPTER 11 ACCOUTING PROCEDURE FOR LUMP-SUM

CONTRACTS

11.1 GENERAL
1) In a lump sum contract the contractor agrees to execute a complete work with all its
contingencies in accordance with the drawings and specification for a fixed sum

Essential Characteristic:-

(i) A schedule of rates is specified to regulate the amount to be added to or deducted from
the fixed sum on account of additions and alterations not covered by the contract.
(ii) Except ABOVE, NO allusion (Reference) is made in the contract to the

- departmental estimate of work,

- schedule of rates or

- quantities of work to be done.

(iii) Detailed measurements of the work done are not required to be recorded (EXCEPT in
for additions and alterations.)

2. The form of contract prescribed by Government in consultation with its Law Officers. Before
the form is finally determined, the advice of the office of the Chief Controller of Accounts
should be sought..

11.2 PAYMENTS FOR WORK DONE

1. Payments for work done are not made to the contractor otherwise than on the certificates
of the officers in charge of the work to the effect that the work has been executed as per
prescribed specification drawings and designs.

2. If the Contract provides for intermediate payment:

A certificate should be given by a responsible officer of Government (not below the rank of
SDO) to the effect that, by an suitable method he has satisfied himself that the value of the
work done is not less than a specified amount and is in conformity with the contract
agreement.

Note - The Divisional Officer is exempted from specifying in the bill the method employed
by him in estimating the value of work done.

3. Final Payments: It would require:

- A record of detailed measurements in respect of additions and alterations,

- A certificate of completion of the work according to the prescribed drawings and specification
signed by the Divisional Officer.

4. Exercising a proper financial control over the payments

it is necessary that the accounts of additions and alterations should be kept quite distinct
from those of the rest of the work. There is no objection to payment for additions and
alterations being made before the completion of the work, if the detailed measurements of them
have been made and the contract provides for that.

11.3 FORMS OF BILLS (Lump Sum Contract)

1. The forms of bills used for payments are Forms 27-A and 27-B.
2. Form 27-A: The Form of Bill has THREE PARTS:

- It is intended for intermediate payments (Like RA BILL)

- No details of work done need be reproduced in the Bill EXCEPT : Reference to

Measurement Book where the measurements of additions and alteration are recorded.

- The form provides for the ‘Secured Advances’,

- A detailed account of the materials should be kept in PART- II of the bill (No record of the
materials need be kept in the Measurement Book.)

- the certificate at Sl.No. 3 of Part III printed on the bill (Form CPWA 27-A) must be signed
by the Officer not below the rank of SDO.

3. Form 27-B:

- It is intended for final payments made to a contractor.

-The details of additions and alterations alone should be given in the bill for the rest

- Certificates prescribed will be sufficient.

- The form of final bill may be printed on yellow paper

11.4 SUBSIDIARY WORKS ACCOUNTS (For Lump Sum Contract):

1. Subsidiary Works Accounts like Works Abstract/ Register of Works & Contractor
Register are maintained for Lump Sum Contract Transactions.

2. For accounting purpose following transactions are treated as “ADVANCE”.

- All ‘intermediate payments’ made to the contactor

- Payments for measured up additions and alterations

- Lump sum Payment of work for which no detailed measurements are necessary

- Net amount remaining after the deduction of the portion withheld (as Security)

3. Above type of payments should be accounted for in the works accounts under the suspense
head ‘Contractors – Advance Payments’.

4. Payments other than above: It may be

- Either ‘Secured Advances’ (Accounted for under Suspense Head ‘Contractors- Secured
Advance’

OR
- Other recoverable payments, (Accounted for under ‘Contractors – Other Transactions’).

5. Recovery of Advances/ Recoverable Payments:

- The total advances or other recoverable payments will be deducted by short payments from
the total value of work done, and

- The recoveries so made will be shown as minus figures under the suspense heads
concerned,

Chapter 12

MANUFACTURE ACCOUNTS

12.1 INTRODUCTORY
12.1.1 When materials are manufactured departmentally, either for the general requirements of
works or for a particular work, a separate account, called a Manufacture Account, must be kept
of the transactions connected with each manufacture. See also paragraph 14.1.2.

12.1.2 The detailed account of the expenditure on a manufacture is maintained in the same way
as the accounts of a work. An account of the quantities and value of the products of the
manufacture is to be maintained in the job card opened for each job from which the cost of
“operation” and “out-turn” can be ascertained directly.

12.1.3 The progress of the manufacture will have to be recorded in a “Register of Manufacture”
(C.P.W.A. Form 42).

12.1.4 It is essential that the accounts of manufacture shall not remain open indefinitely. If the
operations are seasonal, the accounts of each season should be kept separate and closed as soon
as the operations are closed. In cases in which operations are continuous, the accounts must
nevertheless be closed periodically, but at least once a year.

12.2 OPERATION CHARGES

12.2.1 A Manufacture Account is debited directly with (1) value of raw materials issued from
stock or obtained otherwise, (2) the cost of the labour employed, and (3) other incidental charges
connected with the operations.

12.2.2 The following directions apply to certain special incidental charges:-

(a) Capital charges, such as the cost of land, kilns, special plant, etc., incurred in connection with
a manufacture which does not extend beyond a single season, are debited wholly to the account
of the manufacture.

(b) Capital charges in connection with a manufacture extending over more than one season
should be debited in the first instance, to a special account under sub-head “Land, Kilns, etc.” of
the Stock Account. This account should also be debited with the cost of repairs and renewals of
the kilns, etc. All these charges should be recovered in suitable instalments by debit to the
‘Operation’ Accounts of the several seasons, the number of instalments and the amount
chargeable for each season being determined on the merits of each case, under the orders of
competent authority.

Note 1 - The decision as to the suitable instalments whereby the “Land, Kilns, etc.” account is to
be cleared periodically, as given by the authority sanctioning the initial charge, should be
recorded in the Priced Stores Ledger Form 12, and not deviated from without the further orders
of that authority.

Note 2 - When the land, kilns, plant, etc., acquired for departmental manufacture operations are
leased to a contractor of the division or other person, the rent charged should be credited to this
special account and not to Revenue.

(c) If the manufacture is undertaken on behalf of other divisions, Department of Governments or

of local bodies or individuals, a charge should be made on account of establishment and tools
and plant etc., if leviable under the rules, vide Appendix 4, for outlay on works undertaken on
their behalf.

(d) Save as provided in clause (c) above, no charge is permissible on account of the general
establishment and ordinary tools and plant charges, or on account of interest on the capital cost
of the land, kilns, plant etc., though all these charges should be included in any proforma
accounts of the manufacture operations of the divisions, which may be prepared under orders of
the Administrative Ministry / Administrator concerned, with a view to compare the cost of
articles manufactured departmentally with rates charged by suppliers.

12.2.3 The accounts of road metal digging are not treated as manufacture accounts, but the
charges connected with land and quarries acquired for such operations should be dealt with in
accordance with paragraph 7.4.5.

12.2.4 A job card may be opened for each job and all the expenditure connected with the
job should be noted in this card. The value of job should be finalized after adding/totaling this
expenditure and adding suitable percentage to cover labour, tools and plants, overheads etc. The
value of this can be compared with the market rates by the Divisional Officer to satisfy himself if
the work is being done economically.

12.3 GENERAL ACCOUNT

12.3.1 A Manufacture Account is essentially a suspense account as the cost of the operations
cannot be cleared finally until they are closed. Manufacture transactions are, therefore, recorded
under a distinct sub-head, called “Manufacture” of the Stock Suspense Account.

12.3.2 In the Stock accounts, the manufacture transactions should be recorded thus:-

(a) “Operations” charges should be shown as receipts of Stock under the sub-head
“Manufacture”, charges representing value of Stock Material issued to manufacture being
simultaneously treated as issue of Stock under the sub-heads concerned.
(b) All out-turn should first be brought formally on the Stock account, by crediting its value to
“Manufacture” and simultaneously showing the articles as receipts of Stock under the sub-heads
concerned. The value of surplus material sold or otherwise disposed of should, also be credited
to Manufacture”.

Note 1 If the rate of which any article of out-turn, manufactured for particular work is valued,
turns out to be different from the Issue Rate of a similar article already in stock, the value of the
two articles may be averaged for the purpose of stock accounts, allowance being made
necessarily for the different quantities at the different values.

Note 2 No supervision charge is leviable in respect of materials manufactured on behalf of other

divisions, departments, Governments, local bodies and individuals, which are formally passed
through the Stock account under this paragraph. See also paragraph 12.2.2(c ).

CHAPTER 13 – SUSPENSE ACCOUNTS

13.1 INTRODUCTORY
13.1.1 The account of Minor Head “799 – Suspense” under those functional Budgeted Major
Heads of Accounts where expenditure on Works is involved like “2059 – Public Works” etc.,
with their Subordinate Sub-Major Heads in the Consolidated Fund of India, divided into as many
of the three Sub-heads named below as may be required, is kept in each Division under a single
Major Head of expenditure unless Government has directed otherwise:-

(1) Stock, (2) Miscellaneous Works Advances and (3) Workshop Suspense.

The above mentioned heads are of temporary character and all the transactions recorded under
them, are ultimately removed either by payment or recovery in cash or by adjustment. These
transactions, therefore, consist of both debits and credits, the latter being treated as reduction of
expenditure when making up the account of Major Head.

In addition to the above mentioned Suspense Heads of Accounts in the Consolidated Fund of
India, the Minor Head “129 – Material Purchase Settlement Suspense Account” below the Major
Head “8658 – Suspense Accounts” in the Public Account of India, is also operated to account for
the settlement of dues of the Suppliers of Stores, if payment is not made in the same month in
which the stores have been received. In exceptional cases where the Department does not have
required expertise, it may project its indent to the Central Purchase Organisation (e.g.
D.G.S.&D) with the approval of Competent Authority in terms of the provisions of Rule 140 of
General Financial Rules,2005. The indent form to be utilized for this purpose will be as per the
standard forms evolved by the Central Purchase Organisation. However existing procedure for
the procurement of stores through D.G.S&D shall henceforth be followed in such exceptional
cases as per the detailed procedure laid down in Appendix-7C(b) of CPWA Code.

Besides the above mentioned Suspense Head another Minor Head “107 – Cash Settlement
Suspense Account” below the Major Head “8658 – Suspense Accounts” is also operated for the
settlement of inter-departmental transactions with Cabinet Secretariat and Ministry of Defence
(See Paragraph 22.4.10)
13.2 MATERIAL PURCHASE SETTLEMENT SUSPENSE ACCOUNT

13.2.1 When materials are received from a supplier or from another department in India or
abroad (see Note below) their value should be credited to the Minor Head “129 – Material
Purchase Settlement Suspense Account” under the Major Head “8658-Suspense Accounts” as
under:-

(i) Immediately on their receipt, if they have been received for a specific work, so that, per
contra, the cost may be included at once on the accounts of the work and those accounts, as well
as, the connected subsidiary accounts, may take cognizance of the receipt of materials at the
earliest opportunity (see paragraph 10.3.6 and 10.3.11); and

(ii) On closing the account of the month, if they have been received for stock and payment has
not been made for them during the month, so as to secure agreement between the quantity and
value accounts (see Note below paragraph 7.2.29).

Note 1:- The rules for the adjustment of transactions connected with stores obtained from abroad
are contained in Appendix 6.

13.2.2. The following simplified procedure has been laid down to be followed in cases in which
the procedure laid down in the above paragraph, entails much work:-

(i) A single transfer entry order known as Omnibus Transfer Entry Order, Form 53A may be
prepared for all purchases of stores made for specific works in a sub-division during a month, but
it should be written up as each transaction takes place, the entry being attested at once.

(ii) As soon as materials for a work are received from a supplier, a debit entry should be made at
once in the works abstract in the column concerned, viz., “Contractors – Other Transactions”, or
suspense head – “Materials” or “Final Charges”, as the case may be, should be made in the
Omnibus Transfer Entry referred to at (i) above, brief particulars of the transactions being noted
for purposes of identification.

(iii) If any item of supply be paid for during the same month, the amount paid should be noted in
the relevant column and at the end of the month, the total of all items paid for during the same
month should be worked out and only the net amount credited under Material Purchase
Settlement Suspense Account.

(iv) The Omnibus Transfer Entry Order should be incorporated in the transfer entry book only at
the end of the month so that it may not be necessary to copy out in detail the transactions paid for
during the month.

(v) For all items paid for during the month, a single entry “Purchase made and paid for in the
same month” should suffice in the transfer entry book, the suspense register of Material
Purchases Settlement Suspense Account and the Schedule of “Material Purchase Settlement
Suspense Account”.

In order to reduce clerical work, these transfer entry orders may be prepared in triplicate or
through computer so that one copy thereof may serve as an authority for the transfer entry to be
sent to the Pay and Accounts Office; the second copy may be pasted in the transfer entry book in
the Divisional Office, and the third may be pasted in the Suspense Register.

13.2.3 When the actual value of the materials is not known, an estimated figure should be
adopted, any difference being adjusted, as soon as known, by a plus or minus credit to Minor
Head “129 – Material Purchase Settlement Suspense Account”, below the Major Head “8658 –
Suspense Accounts” as the case may be. (See also note below paragraph 13.2.4)

13.2.4 When the price of the materials is paid or adjusted by transfer, the payment should be
debited i.e., Minus Credit to Minor Head “129 Material Purchase Settlement Suspense Account”
and the outstanding credit under “Material Purchase Settlement Suspense Account” thus cleared.

Note – If the amount admitted in payment exceeds the amount credited to “M.P.S.S.A.” the
difference should be charged direct to Stock or to the work concerned, and should not be shown
as minus entry.

13.2.5 Unclaimed balances in the Material Purchase Settlement Suspense Account should be
dealt with in accordance with the procedure prescribed for Deposit balances in paragraph 15.4.1.
Paragraph 15.4.3 regarding the repayment of lapsed deposits applies mutatis mutandis to
repayment of lapsed balances of Material Purchase Settlement Suspense Account. Outstanding
balances lapsed to revenue and requiring adjustment on the basis of Old PAO Memos should not
be equated to repayment of lapsed Deposits.

The write back of such lapsed balances of “Material Purchase Settlement Suspense Account” are
in the nature of corrections of erroneous adjustments and no precheck of such transaction is
contemplated. Pre check by PAO would be necessary, if the amount is required to be paid to any
party.

13.2.6 The account of this head should be kept in Form 67, “Suspense Register”, the details
being recorded in a separate set of folios for each of two headings (1) Purchases for Stock and
(2) Purchases for specific works (see also Rule 9 of Appendix 6).

13.3 STOCK

13.3.1 The head “stock” is opened in all divisions in which stock of materials is maintained for
general purposes, vide paragraph 143 of the Central Public Works Department Code. In divisions
in which no stocks are maintained, this account should be opened only when any manufacture
operations are undertaken.

13.3.2 The money limit for the stock reserve of a division, prescribed by the Administrative
Ministry/Administrator concerned, vide paragraph 143 of the Central Public Works Department
Code, is meant to be applied to the value of materials acquired or manufactured for stock
purposes only. Excesses over this limit are, therefore, permissible only when caused by
unadjusted expenditure on manufacture operations connected with specific sanctioned works.

13.3.3 The account head “stock” is debited with all expenditure connected with the acquisition of
stock materials, and with all manufacture operations. It is credited with the value of materials
issued to works, or sold, transferred or otherwise disposed of, and the balance of account will
represent the book value of the materials in stock plus the unadjusted charges, etc., connected
with manufacture.

13.3.4 The sub-heads of the Stock account are:- (1) Small Stores, (2) Building Materials, (3)
Timber, (4) Metals (5) Fuel, (6) Painters’ Stores, (7) House Fittings, (8) Miscellaneous Stores,
(9) Land, Kilns etc., (10) Manufacture and (11) Handling and other Incidental Charges Nos. (1)
to (8) may be replaced locally by other suitable Heads, if necessary.

13.3.5 The general account of the receipts, issues and balances of the suspense head, “Stock”
should be maintained in the Suspense Register, Form 67. A separate account should be kept in
respect of each sub-head, the transactions of the several sub-divisions being detailed therein as
separate items and the totals of all sub-divisions as another.

Transfers within the division should be accounted for against a single item “Deduct Transfers
within Division” before the total for the entire head “Stock” is struck.

13.3.6 Expenditure booked under the sub-head “Handling and other incidental charges” should
be brought to nil at the time of adjustment of profit and loss in the stock accounts as laid down in
para 7.2.34 of this Code.

Note (a) The clearance of balances under “Transfer within Division” should receive special
attention. (b) The subsidiary accounts of stock are described in Chapter 7 and 12.

13.4 MISCELLANEOUS WORKS ADVANCES

13.4.1 Transactions recorded under Sub-head “Miscellaneous Works Advances” under the Minor
Head “799 – Suspense” below the functional Major/Sub-Major Heads concerned are divided into
four classes:-

(1) Sales on credit

(2) Expenditure incurred on Deposit Works in excess of deposits received

(3) Losses, retrenchments, errors, etc.,

(4) Other items

Note: No charges should be debited to this head on the ground of absence or insufficiency of
sanction or appropriation except as provided in item (2).

13.4.2 When stores of any kind are sold on credit, their value (plus if recoverable, the
Supervision charges referred to in paragraph 150 of the Central Public Works Department Code)
should be debited to “Miscellaneous Works Advances” under the detailed head “Sales on Credit”
so that (1) the accounts of Stock or Works from which the materials are issued may be kept
correctly, and (2) the recovery of the value from the local body or individual concerned may be
watched through the regular accounts.

Note – In each case, there must be authority for the sale on credit
13.4.3 Outlay on Deposit Works is required to be limited to the amounts of deposits received.
Any expenditure on Deposit Works, incurred in excess of the amount deposited, is chargeable
annually to “Miscellaneous Works Advances” pending recovery

to effect which action should be taken at once. See paragraph 13.4.7.

13.4.4 Under the heading “Losses, retrenchments, errors etc.” appear the following:-

(a) Deficiencies in cash or stock

(b) Actual losses of cash or stock

(c) Errors in accounts awaiting adjustment

(d) Retrenchments and losses of other kinds recoverable from Government Servants

13.4.5 The head “Other items” is meant for all debits, the allocation of which is not known or
which cannot be adjusted until recovery or settlement is effected or write off ordered. The
following are cited as examples:-

(1) debits, the classification of which cannot be determined at once;

(2) recoverable debits not pertaining to the accounts of a work; and

(3) recoverable outstanding appertaining to works, the accounts of which are closed vide
paragraphs 10.5.19 and 10.6.8

Note – The share of municipal taxes paid by Government on behalf of licensees of Government
buildings should be debited to this head, pending recovery

13.4.6 Items in the “Miscellaneous Works Advances” account are cleared either by actual
recovery, or by transfer, under proper sanction or authority to some other head of account. Items
or balances which may become irrecoverable should not be so transferred until ordered to be
written off.

13.4.7 The detailed accounts of this head should be kept in Form 67, Suspense Register. For
items falling under the class “Expenditure incurred on Deposit Works in excess of deposits
received”, details are not necessary, as these are recorded in the Schedule of Deposit Works,
Form 65. For each of the other three classes of items, a separate set of folios should be reserved,
and all the items under each class should be detailed, so that their clearance may be watched
individually. An abstract should be prepared to show the totals of all the classes.

13.5 WORKSHOP SUSPENSE

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13.5.1 When a workshop has been established, the accounts of which are kept in accordance with
the rules in Chapter 14, all direct outlay on the jobs executed and on other operations of the
workshop is passed through the suspense head “Workshop Suspense” and a separate account is
kept under it of each job or operation, so that all charges relating to each may be collected and
charges of a general nature may be suitably distributed over all the jobs or operations affected,
before the total cost recoverable is determined.

13.5.2 The recorded expenditure on a job is removed from the suspense head only when and to
the extent that, an adjustment is effected against the deposit received or against the service or
other head concerned, vide paragraph 14.2.4. This removal is effected by a credit to the account
of the job. But, when any charges are transferred from one job or operation to another, the
transfer should be made by plus and minus debit entries

13.5.3 On the completion of a job, all outstanding charges on it must be debited, as soon as
possible, to the head concerned, but in cases where this cannot be done, as in the case of
expenditure incurred in excess of the deposit received, the unadjusted amount should be
transferred to the head “Miscellaneous Works Advances” pending settlement.

13.5.4 The detailed account of the transactions under this head should be kept in a suitable form
prescribed in accordance with the rule in paragraph 14.1.3. The object being to maintain an
account showing the cost of each job or operation and its adjustment from time to time.

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CHAPTER 14 WORKSHOP ACCOUNTS

14.1 Introductory
14.1.1 The accounts to be kept in a workshop depend on the extent of the operations and

the size of the shop.

14.1.2 When there is a small shop in a division for the execution of repairs of tools and

plant or small manufacture jobs, the accounts of works executed in such shops should be

kept in the forms prescribed for repair works or manufacture operations, as the case may

be.

14.1.3 Larger workshops, with special plant or machinery are treated as separate subdivisions

or divisions, for account purposes. When such workshops are of the character

of quasi-commercial undertakings, the system of accounts will be that prescribed locally

for similar undertakings. When they are run mainly for departmental purposes, the

accounts should be kept in accordance with the instructions laid down in this Chapter. In

either case, the exact forms to be used and the procedure to be observed will be settled by
the Administrative Ministry/Administrator concerned, in respect of each workshop in

consultation with the office of the Chief Controller of Accounts.

14.1.4 For every job there must be an estimate of cost (providing for all charges,

including the prescribed percentages for indirect charges, vide paragraph 14.2.5)

sanctioned by competent authority and accepted by the indenting officer, local body or

individual: See also paragraph 14.1.5. The amount to be realized from the indenting

party will, however, be based on the actual cost including indirect charges, though the

authorized limit of cost, which the officer in charge of the workshop may incur without

further authority, is that shown in the accepted estimate.

Note – If the execution of a job for another division, department or Government is likely

to extend beyond one financial year, the limit of the cost which may be incurred in each

financial year should also be settled beforehand.

14.1.5 No work should be undertaken for municipalities or private parties before the

whole estimated cost including all charges for supervision, profit, etc that may be leviable

under the rules for the time being in force, has been paid to the Divisional Office. This

rule may be relaxed at the discretion of the Divisional Officer, or Superintendent of the

Workshop, in the case of Government Offices where full recovery is not open to doubt.

In such cases a rough estimate of the probable cost must be prepared in advance and the

officer concerned is required to give an undertaking that he agrees to pay the actual

charges in full on completion of the work. The full expenditure incurred must be

145

deducted from the officer’s pay for the following month. In all cases, prior to work being

commenced an undertaking should be procured from the party concerned that it will not

hold the Department responsible for loss by fire or theft or any other factor which could

not be foreseen when the estimate was prepared. In cases where it is found that the
original estimate is likely to be appreciably exceeded, a revised estimate should be

prepared and the procedure outlined above adopted. The cost of the operations should be

charged monthly to the head “Miscellaneous Works Advances” pending recovery.

14.2 Direct and Indirect Charges

14.2.1 Receipt and expenditure transactions in connection with the Workshops are

brought to account as follows:-

(a) Where capital accounts of a Workshop are kept and intended mainly for the needs

of the irrigation Branch (i.e. if the Workshop is to be regarded as being on a quasicommercial

basis), the capital expenditure should be recorded under the relevant Major

head 4701 Capital Outlay on Major and Medium Irrigation. Receipts representing

recoveries of capital expenditure will be taken in reduction of such expenditure while

revenue receipts and working expenses will be booked under the minor heads opened

under the corresponding division and sub-division of the major head 0701 Major and

Medium Irrigation and 2701 Major and Medium Irrigation respectively, divided so as to

meet the requirement of the proforma accounts of the shop (vide paragraph 14.3.1).

Note – The procedure described above will apply mutatis mutandis to the transactions of

a Workshop established for any other system or project for which regular capital accounts

are kept.

(b) Where capital accounts of a Workshop are kept and intended mainly for the needs

of the Civil Works Branch, all expenditure incurred upon it, whether of the nature of

capital or of working expenses, should be recorded under the major head 2059 Public

Works Recoveries of capital expenditure will be taken in reduction of such expenditure;

revenue receipts will be booked under the minor head “800 – Other Receipts below the

major head ‘0059 Public Works’ divided so as to meet the requirements of the proforma

accounts of the shop.

(c) Where no capital accounts of a workshop are kept for whichever branch intended

all expenditure should be booked under the major head ‘2701’ Major and Medium

Irrigation or ‘2059’ Public Works as the case may be, and all receipts, whether

“recoveries of expenditure” or “revenue receipts”, under the minor head “800 – Other

Receipts” of the corresponding revenue Major Head ‘0701’ Major and Medium Irrigation

or ‘0059’ Public Works.

14.2.2 All capital charges on buildings, plant and machinery and stock materials and all

charges incurred on their maintenance and on the upkeep of the necessary general

establishment, should be accounted for as ordinary Public Works transactions under the

major head concerned, in accordance with preceeding paragraph and under the general

146

instructions of other Chapters of this Code. These are charges which neither pertain to

any individual job executed in the shops nor are capable of direct apportionment amongst

all the jobs, and are, therefore, met out of the grants of the Department, the distribution of

such charges over individual jobs being made in accordance with the rule in paragraph

14.2.5.

14.2.3 All other expenses connected with the operations of a workshop are debitable to

the jobs concerned and should, therefore, be accounted for under suspense head

“Workshop Suspense” vide paragraph 13.5.1 to 13.5.4. The charges pertaining

exclusively to any job should be debited to it at once, and those of general nature should

be treated, in the first instance, as general charges (under one or more suitable headings)

and apportioned subsequently amongst the jobs concerned in accordance with a definite

procedure.

Note 1 – This paragraph does not apply to incidental charges connected with the stock of

materials which should be dealt with under paragraphs 14.2.2 and 7.2.27.
Note 2 – All liabilities should be taken into account, even through undisbursed so that the

general charges may be correctly allocated month by month, and the recorded

expenditure on each job may represent, as far as possible, the actual cost uptodate.

14.2.4 In the case of jobs of all classes, the cost of operations should be cleared or

adjusted in transfer (paragraph 13.5.2), as the case may be, month by month but in the

following cases the accounts of a job may be settled once a year in March, or in an earlier

month if the job is completed earlier (vide paragraph 13.5.3)

(a) When the total cost during the year is not larger than Rs.500/-

(b) When the monthly settlement of account is inconvenient to the indenting

division, department or Government.

Note – When the estimated cost of a job is recovered in advance, it should be kept in

deposit in the first instance and the adjustments of actual cost made under this paragraph,

should be effected against the deposit, the unexpended balance being refunded only when

the job is completed and the account of it settled.

14.2.5 In addition to the direct charges referred to in paragraph 14.2.3 – the account of

each job should be debited, not through the Workshop Suspense account but directly

under the head of account concerned, with suitable percentages determined by the

Administrative Ministry/Administrator concerned, in consultation with the Chief

Controller of Accounts to cover the indirect charges enumerated below:-

(a) Supervision charges under paragraph 150 of the Central Public Works

Department Code.

(b) Interest on the capital cost of buildings, plant and machinery

(c) Maintenance charges of buildings, based on actual plinth area of the building,

plant and machinery

147
(d) Depreciation of buildings, plant and machinery

(e) Establishment charges (including ¼ percent w.e.f. 1-6-1984, Audit and

Accounts Establishment); See Rule 7 of Appendix 4 (See also paragraph

14.2.2)

The percentage for Supervision charges should be calculated on the value of materials

issued to each job. The other charges are ordinarily calculated on the total cost of labour

and stores pertaining to the job. It is usual to charge a further percentage on account of

profit except in the case of jobs executed for other divisions of Government.

Note – The percentage realized on account of establishment charges relatable to works

done for other Governments, Local Funds, Private Parties, etc, is treated as revenue

receipts and credited to the minor head “103 Recovery of percentage charges” under

appropriate Sub-Major Head below Major head “0059 – Public Works” in accordance

with the provisions of Rule 9 of Appendix 4 and Statement ‘E’ of Appendix 2. The

above procedure will be followed mutatis mutandis for distribution of “Tools and Plant”

charges also.

14.2.6 The indirect charges referred to in paragraph 14.2.5 should be brought to account

whenever the settlement of the account of direct charges is effected under paragraph

14.2.4.

14.3 Annual Account and Review

14.3.1 Annually, proforma accounts of each workshop should be prepared, consisting

of:-

(i) the Capital Account, showing the values (after making due allowance for

depreciation) of the buildings, machinery and plant and stock and the outstanding balance

of the Workshop Suspense Account.

(ii) The Out-turn Account showing, in such details as may be necessary, the charges
on labour, stores, the general and indirect charges and

(iii) The Profit and Loss Account showing on the one side the actual working

liabilities of the year e.g.(a) interest calculated on the mean capital of the year under all

the heads named in (i) above, (b) the actual maintenance charges of buildings and

machinery and plant, (c) depreciation of buildings, machinery and plant calculated on the

Capital Value thereof and (d) general establishment charges plus a suitable addition

thereto on account of leave and pensionary charges, for audit and accounts establishment,

only on such jobs in respect of which this percentage is not credited to the major heads

“2016 Audit” or “0070 Other Administrative Services – 60 – Other Services 110 – Fees

for Government Audit” in the regular accounts (vide Rule 7 of Statement E of Appendix

2) and on the other side the percentage charges made under paragraph 14.2.5 excluding

for audit and accounts establishment credited to “2016 Audit” or “0070 Other

Administrative Services – 60 Other Services 110 – Fees for Government Audit”.

148

Note – The stock account should be treated as a part of the Workshop account, only if

and to the extent the reserve stock is declared by the Administrative

Ministry/Administrator concerned to be part and parcel of the shops. When the whole or

part of a stock is merely and adjunct to a workshop neither the interest charges on it nor

the losses or gains (including supervision charges) arising out of it, should appear in the

Profit and Loss Account of the Workshop.

14.3.2 Subject to such directions as may be given by the Chief Accounting Authority of

the Administrative Ministry, the Chief Controller of Accounts will review the annual

accounts of a workshop, in consultation with the officer in charge of it and report to the

Chief Accounting Authority concerned on its financial working specially bringing out the

necessity or otherwise of revising the percentages fixed for the several charges referred to
in paragraph 14.2.5 above.

Note – To facilitate the review of percentages, it will be found convenient to show in the

Profit and Loss account, not only the figures of the year but also the progressive figures,

to the close of the year commencing from a suitable date.

149

CHAPTER-15 DEPOSITS

15.1 Introductory

15.1.1 Deposit transactions of the Public Works Department are of two kinds:-

1. Public Works Deposits, which pass through the regular accounts of the

Division

2. Interest bearing securities

Deposits of the first kind as referred to in ‘1’ above comprise transactions of

the following classes, which are passed through the head Public Works

Deposits:-

a. Cash deposits of subordinates as security,

b. Cash deposits of contractors as security,

c. Deposit for work other than Takavi Works to be done,

d. Sums due to contractors on closed accounts and

e. Miscellaneous deposits.

The interest-bearing securities of kind two as referred to in 2 above are

deposited by subordinates and contractors. These do not pass through the

regular accounts of division.

15.2 Security Deposits

15.2.1 Security Deposits of subordinates and contractors, whether made in the cash or in

one of the forms of security referred to in Paragraph 15.2.2, are covered by a bond or
agreement setting forth the conditions under which the security is held and may be

ultimately refunded or appropriated. Reference to such bond or agreement should be

recorded in the Deposit Register or the Register of Securities, as the case may be.

15.2.2 The recognized forms of interest-bearing securities and the conditions to which

they are subject to are indicated below

Forms of Security Conditions

i) Promissory notes and

stock certificates of the

Central Government or a

State Government

(1) These securities shall be accepted at five per cent

below their market price or at their face value, whichever

is less and shall be in accordance with the Rules in

Chapter IX of the Government Securities Manual.

Note:- Gold Bonds may be accepted as security as they

are also Government securities

(2) The market value of Government paper should be

ascertained at the time of collection of interest to the

150

extent of deficiency in value of the Government paper

withheld, if necessary.

ii)Post Office Cash Certificates,

National Savings

Certificate, Certificates and

National Plan Certificates

(1) These certificates shall be formally transferred to the

President of India: The departmental authorities

authorized to accept security under Rule 275 of General

Financial Rules, 2005 shall accept the same with the

sanction of the Post Master of the Office of registration at

their surrender value at the time of tender.

(2) Certificates which are not held in the name of the

person furnishing the security shall not be accepted.

iii) Post Office Saving Bank

Pass Books

(1) A passbook for a deposit made under the Post Office

Saving Bank Rules may be accepted as security provided

that the depositor has signed and delivered to Post Master,

a letter in the prescribed form as required by those rules.

(2) Security Deposits lodged in the Post Office Saving

Bank should be hypothecated to the Divisional Officer, if

this has been specially authorized by the Administrative

Ministry/Administrator concerned.

(3) The passbook should remain in the custody of the

Officer to whom the deposits are pledged.

(4) The passbook shall be sent to the post office in the

beginning of each financial year to get the entries on

account of interest made in them.

iv) Municipal debentures or

Port Trust Bonds and or

debentures issued by the

State Financial Corporations

These securities shall be accepted at five percent below

their market price or at their face value whichever is less

and shall be dealt with the accordance with the rules in

Chapter IX of the Government Securities Manual.

v) Bonds or debentures

issues by the Corporate

Bodies and or established by

or under any Central Act

which are guaranteed by the

Central Government as

regards the payment of

principal and interest or as

regards the principal only.

The securities should be accepted at 5% below their

market price or at their face value, whichever is less. It

should be verified that the guarantees by the Central

Government have not been revoked and continue to be in

force. Security in these forms should not be accepted

unless the transfer of title to the concerned officer

accepting the security on behalf of the Government has

been or can be validly effected and if necessary, registered

(or it has been ascertained that the transfer will be made or

registered) on the books of body corporate.

vi) Deposit receipts of all

Schedules Banks including

Fixed Deposits.

(1) The deposit receipt shall be made out in the name of

the pledge, the bank shall certify on it that the deposit can

be withdrawn only on the demand, or with the sanction of

the pledgee. The bank shall agree that on receiving a

signed Bank Challan and a withdrawal order from the

pledgee in respect of the deposit, or any part thereof, it

will at once remit the amount specified into the nearest

Bank along with the challan and send the bank receipt to

the pledge.

151

2) Such receipts will be accepted on the understanding

that Government is not held responsible for any loss that

may result from the failure of the bank or any other cause

and if the security is lost, the loss will fall on the depositor

who will be required to furnish fresh security.

3) The depositor shall receive the interest when due,

direct from the bank on a letter from the pledge

authorizing the bank to pay it to him.

4) The responsibility of the pledgee in connection with

the deposit and interest on it will cease when he issues a

final withdrawal order to the depositor and sends as

intimation to the bank that he has done so

5) The deposit receipt should be held in custody by such

official as the Administrative Ministry/Administrator

concerned, may prescribe.

Note:- While accepting the Fixed Deposit Receipts it should be ensured that these cover

the stipulated period of Contract plus the defect liability period mentioned in the Contract

and also the receipts should be made out in the name of the Divisional Officers.

vii) Cheques/drafts issued

by big Urban Banks whose

working capital exceeds

Rs.5 crores and by ‘A’, ‘B’

or ‘C’ Class Central

Cooperative Banks

Cheques/drafts may be accepted as securitgy from private

contractors/supplier has furnished a Cheque/draft, the

authorities concerned shall ensure that the Cheque/draft is

encashed immediately and the contract is allotted only

after the encashment of Cheque/draft.

viii) 10 years Social

Security Certificates

The pledging of 10 years Social Security Certificates

should be in accordance with the procedure laid down in

the Rules Governing these certificates.

ix) Guarantee bonds of

Scheduled Commercial and

Non-commercial Banks
Guarantee bonds in the form prescribed and duly stamped

by the Administrative Ministry, tendered by the contractor

or a Public Sector Enterprise may be accepted as security.

In accepting the guarantee bond, Divisional Officer should

exercise great care in determining the date beyond which

the guarantees would cease to operate, keeping in mind

the period of completion prescribed and the period likely

to be taken for the finalization of the account of the

contract.

x) Fidelity Bond form any

one of the following four

subsidiaries of the General

Insurance Corporation of

Fidelity Bond in Form G.F.R.34 as referred to in Rule

275(3) of General Financial Rules, 2005 may be accepted

as security from a Government Servant but not from a

private party. When a Government servant has furnished

152

India:-

a) National Insurance

Company Ltd.

b) New India Assurance

Company Ltd

c) Oriental General

Insurance Company Ltd

d) United India General

Insurance Co Ltd

security in Form GFR 34, the departmental authority

authorized to accept security under Rule 275 of General

Financial Rules, 2005 shall see that the Government

servant pays premia necessary to keep it alive on the due

dates and continues to do so until he vacates his office. If

the Government servant fails to submit that premium

receipts in time, he shall not be allowed to perform the

duties of his post and dealt with in accordance with the

terms of his appointment.

xi) KISAN VIKAS

PATRA

The pledging of these Patras should be in accordance with

the procedure laid down in the Rules governing these

Patras.

15.2.3 Cash deposits of subordinates and contractors may be converted at the cost of the

depositor, into one or more of the forms of interest-bearing securities provided:-

(i) that the depositor has expressly desired this in writing and

(ii) that the acceptance of the new forms of security are permissible under the rules as

well as under the terms of the agreement or bond.

Note – Cash which has actually been received or recovered may be converted even

though the full amount of the deposit which is being paid in instalments, has not yet been

realized. This includes Earnest Money deposited in Cash/Cheque/Draft and subsequently

forming part of Security Deposits.

15.2.4 Percentage deductions for security deposits, related to estimate cost of the work

awarded, made from contractors’ bills, should be credited to Major /Minor Head “8443-

Civil Deposits”-108-Public Works Deposits” with sub-head “Cash deposits of

contractors” thereunder. As an exception to this rule, the security may be exacted by

withholding from payment the required percentage of the value of work actually

measured and passed, if the total amount recoverable on this account during the financial

year in any case is so small that its exclusion from the works outlay of the year is not

likely to affect the grants appreciable. The limit fixed for the purpose is Rs.500/- for each

work. Amounts thus withheld appear in the Suspense Account,”Contractors-Other

Transactions” of the work concerned.

15.2.5 Without the special orders of Competent Authority, no security deposit should be

repaid or retransferred to the depositor, or otherwise disposed of, except in accordance

with the terms of his agreement or bond.

Note – The Depositor’s acknowledgment should be obtained in all cases of security

returned. When an interest-bearing security is returned or retransferred, the

acknowledgment should set forth the full particulars of the security.

15.3 OTHER DEPOSITS

I For Works

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15.3.1 Deposits for works other than takavi Works are passed through the head “Public

Works Deposit”. Such works are known as Deposit Works and the detailed rules relating

to them are given in Chapter 16.

II Contractors Closed Accounts

15.3.2 Under the rules in Paragraph 10.5.19 sums due to contractors on closed accounts

may be placed in the Deposit Account. When a sum so held in deposit is ultimately paid
to the contractor concerned, his acknowledgment should set forth such particulars as

would establish the settlement of his account in connection with the work concerned.

III Miscellaneous

15.3.3 All other deposits are classed as Miscellaneous Deposits. This head also holds

until clearance, all items of receipt, the classification of which cannot be determined at

once or which represent errors in account awaiting adjustment.

15.4 LAPSED AND CONFISCATED DEPOSTS

15.4.1 At the close of March each year, the following classes of items in the Public

Works Account should be credited to Government as Lapsed Deposits:-

(i) Deposits not exceeding twenty five rupees, unclaimed for one whole account

year, or residuary balances not exceeding the said amount out of deposits partly

repaid during the year then closing and.

(ii) All Deposits or balances in excess of the above said amount, unclaimed for

more than three complete accounts years.

(See Rule 189 of Central Government Account(Receipt and Payments)

Rules,1983 as amended from time to time.)

Note 1:- A list of deposits and balances thus lapsing shall be sent to the Pay and

Accounts Officer in accordance with the relevant directions. For the purpose of this rule,

the age of repayable item, or of a balance of it, may be reckoned as dating from the time

when the item deposited by a party in connection with a contract or supply order is on

request decided to be reckoned as deposit against subsequent contract or supply order

awarded to the same party, the age of item will be calculated with reference to the date of

the letter.

Note 2:- Such of the deposits(or balances of deposits) referred to in (ii) of

paragraph 15.4.1 which pertain to contracts, supply orders that are under litigation or
arbitration shall not be deemed as “unclaimed deposits” for the purpose of credit ting to

Government under this rule. They should, nevertheless, be listed out distinctly along

with relevant particulars so as to facilitate action for releasing the deposit or for forfeiting

it, depending on the judgment or award at the conclusion of the litigation or arbitration.

Relevant claim will require pre-check by the Pay and Accounts Officer before repayment.

15.4.2 Before the amount of lapsed or confiscated deposits is credited to Government as

revenue, the original realization should be traced and reference to the credit should be so

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recorded against the original entry in cash book and other accounts as to make the

entertainment of a double or erroneous claim impossible.

15.4.3 Deposits credited to Government under Paragraph 15.4.1, or confiscated under the

provisions of an agreement or bond cannot be repaid, without pre-check by the Pay and

Accounts Officer who will authorize payment on ascertaining following

(1) that the item was really received,

(2) that it was credited to Government as lapsed or confiscated and

(3) that the claimant’s identity and title to the money are certified by the Divisional

Officer.

The amount repaid should be treated as a refund of receipts under the Major Head

to which it was credited and the repayment should be noted in the Deposit Register

against the entry for its credit to Government vide Paragraph 9.4.2.

15.5 ACCOUNTS OF PUBLIC WORKS DEPOSITS

I Deposit Register

15.5.1 A record of the transactions relating to Public Works Deposits should be

maintained in the divisional office in a register in the same form as the Suspense

Register,C.P.W.A 67. This Deposit Register should show, month by month the total
receipts and adjustments and the closing balance of each separate deposit item, but in

respect of deposits for work to be done which are accounted for in detail in the Schedule

of Deposit Works, Form CPWA65, a single entry for such deposits will suffice.

15.5.2 Before refund of deposits, otherwise in order, is allowed or the amount

outstanding in deposit account is converted into interest-bearing security, the original

realization should be traced and a reference to the repayment should be so recorded

against the original entry in the Cash Book and other accounts as to make the

entertainment of a double or erroneous claim impossible. A certificate for such a note

having been made, should be made in all vouchers for refunds. Any acknowledgments

previously granted should be taken back, if possible, and destroyed, a note of the

repayment being in any case recorded on the counterfoil of the receipt.

II Schedule of Deposit

15.5.3 From the Deposit Register, a monthly extract know as the Schedule of Deposits,

Form CPWA 79 should be prepared for submission to the Pay and Accounts officer. This

form is in two parts-Part I Account giving total for each class of deposit. Part II detailed

extracts from the deposit register. In PartII only such items need be extracted as are

effected by the months transactions.

Note:- The entry for deposits for work to be done will be supported by the Schedule of

Deposit Works.

15.6 ACCOUNTS OF INTEREST –BEARING SECURITIES

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15.6.1 Transactions connected with interest-bearing securities do not pass through the

Cash Book and consequently the regular accounts of the Division, unless any cash

actually pass through the hands of officer of the department, which should be avoided as

far as possible. A register of the receipt and disposal of these securities should, however
be kept in CPWA form85 Register of Interest-bearing Securities and at the close of the

year, an account in CPWA Form 86 Account of Interest-bearing Securities should be

prepared from this register for submission to the Pay and Accounts Officer. This account

should be supported by (1) the acknowledgment (in original) of depositors for securities

returned or re-transferred to them during the year, and (2) the certificate of the Divisional

Officer that all securities shown as outstanding in this account, or their acknowledgments

by the aurhorised custodians (vide paragraph 15.2.2) are in his possession.

Note 1- If a security recovered in installments is being deposited in the Post Office

Saving Bank, no entries should be made in respect of it in the Register in CPWA Form 85

until the security has been fully paid up. But if such security deposit is to be refunded

before the full amount is recovered, it should be treated as fully paid up and brought on

the register before being refunded. The annual Account in CPWA Form 85, should be

completed in respect of the securities in course of recovery, by taking the recoveries of

the period covered by the Account from the Deposit Register, verifying them at the same

time with the actual recoveries as shown in the Register of recoveries (paragraph 22.2.9)

Note 2 – If any Post Office Saving Bank Deposits have been hypothecated to a Divisional

Officer under Paragraph 15.2.2.

(ii) the register for such securities should be kept by him and he should sign the annual

certificate in respect of them.

Note 3- The procedure to be observed when a subordinate who has furnished an interestbearing

security, is transferred to another division or department, depends on the terms of

the agreement and on the procedure followed locally in regard to the disposal of the

security. It should be prescribed by the Administrative Ministry/Administrator concerned

in consultation with the Pay and Accounts Officer.

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CHAPTER 16 NON-GOVERNMENT WORKS

16.1 Introductory

16.1.1 Non-Government Works are divided into three classes – (1) Deposit Works (2)

Local Loan Works and (3) Takavi Works

16.1.2 The General direction for the exhibition in accounts, of transactions relating to

contributions from Central Revenue to Local Funds and Public bodies, and vice-versa as

contained in Rule 68(1) of the Government Accounting Rules 1990 is reproduced

below:-

“Contributions made by the Central or the State Government to District Boards,

Municipalities, etc or vice-versa should be debited as expenditure or shown as receipts

(as the case may be) under the head of account most closely connected with the object for

which the contributions are made. Thus, a grant for the construction of a school should

be debited to “2202 - General Education” grant for constructions of a drainage system to

“2215 – Water Supply and Sanitation” and a grant for construction of a road to “3054 –

Roads and Bridges” and grant given for general purposes, such as grant to make good a

deficit or a compensation for revenue resumed, shall be classified under “3604 –

Compensation and Assignments to Local Bodies and Panchayati Raj Institutions.”

Note 1 – If the financial assistance given by the Central Government to a Local body

does not take the form of a grant of cash, but of expenditure in the Public Works

Department equivalent to the whole or a part of the cost of a work constructed by that

Department on behalf of the local body concerned, the contribution thus made should be

debited as expenditure under the detailed head “Contributions” below the relevant

major/minor head corresponding to the function/programme closely connected with the

object of the assistance.

Note 2 – When buildings are constructed by CPWD and handed over to the grantees – In
cases where the grantee institutions, organizations etc are willing to have the buildings

constructed through the Central Public Works Department out of the grants-in-aid given

by the Government, the sanctioning authority should get the buildings constructed

through the Central Public Works Department instead of giving grants directly to the

grantee institutions and then hand over the buildings to the grantees. The following

instructions should be kept in view while doing so:-

The expenditure on such works should be met from the Budget Grants of the

Administrative Ministry sanctioning the grant to the institution concerned. Necessary

provision for the “Grants-in-aid” may be made in the respective Ministry’s grant under

the relevant Major Head (Education, Medical, Public Health etc). The budget provision

in each year should be restricted to the actual amount that is likely to be expended on the

work in that financial year. The amount will not be paid in cash to the grantee institution

but paid to concerned Central Public Works Division by means of ‘Government Account’

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Cheque, debiting the expenditure as grants-in-aid etc, the latter shall classify it under the

head “8443 – Civil Deposits 108 Public Works Deposits”.

Note 3 – A contribution paid by a local body or private party with the express object of

meeting the whole or part of the cost of construction by the Public Works Department of

a specific work which is eventually to be property of Government should be credited as

revenue receipt of the Government relevant to the function/programme closely connected

with the object for which the contribution is made.

16.1.3 In the Public Works Accounts, contributions made to Local Bodies are debited

to the object head ‘Contributions’ below the relevant major/minor head corresponding to

the function/programme closely connected with the object of the assistance. See also

Note 1 below para 10.8.6.

16.1.4 When works already constructed or land already purchased, are transferred

free of charge to local bodies, no readjustment of the amounts of cost is necessary.

Note – The rule in this paragraph does not apply to Irrigation, Navigation and Drainage

Works (Commercial)

16.1.5 For every Non-Government Work there must be a duly sanctioned detailed

estimate of requisition as the case may be, in the same way as for a Government Work.

16.2 DEPOSIT WORKS

I. General

16.2.1 For every Non-Government Work the local body or other party concerned should

advance the gross estimated expenditure, which is payable by it to the Divisional Officer

in lumpsum or in installments, and by such dates as may be specially authorized by the

Administrative Ministry/Administrator concerned, vide paragraph 118 of the Central

Public Works Department Code. The amount received should be credited in the accounts

to the head “108 – Public Works Deposits” under the Major Head 8443 – Civil Deposits”,

against which will be debited all expenditure incurred up to the amount of the deposit.

As regards expenditure in excess of deposit, see paragraph 13.4.3 of this Code.

Note – In case of autonomous bodies financed entirely from Government funds where the

receipt of money is assured only 33W% of the estimated cost of a particular work need be

got deposited as advance and thereafter expenditure incurred may be got reimbursed

through monthly bills. The deposit of 33W% obtained earlier should be retained for

adjustment against the last portion of the estimated expenditure.

16.2.2 A consolidated record of the transactions of a month relating to all Deposit Works

of the Division should be prepared in Form 65, Schedule of Deposit Works. The

schedule shows, in respect of each work, the amount of deposit received and the

expenditure incurred, both during the month and upto date.

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Note 1 – Refunds of unexpended balances of completed works should be taken in

reduction of the deposits and therefore, shown in the schedule as minus realizations and

not as expenditure.

Note 2 – All payments of “decretal amounts” pertaining to “Deposit Works” should be

charged on the Consolidated Fund of India under the minor head 799 Suspense, Sub-head

“Miscellaneous Work Advance”Detailed Head – Other items subordinate to the relevant

major head. These should simultaneously be transferred to the Deposit Work concerned

by debit to “108 - P.W. Deposits – Deposits for work other than Takavi Works to be

done” if sufficient funds are available or to Miscellaneous P.W. Advances – Expenditure

incurred on Deposit Works in excess of deposits received (voted) (In case sufficient

funds are not available) in accordance with the instructions contained in paragraph 16.2.1

and 13.4.3 respectively of this Code.

16.2.3 The amount of each deposit should be rateably divided into two parts, one

representing the share available for works expenditure and the other the total amount

chargeable as establishment, tools and plants, audit and accounts and pensionary charges,

if any, recoverable under the rules, vide Appendix 4. In the schedule, the deposit

received for each work should be numbered as a single item, but the transactions relating

to the two parts of it should be shown separately thus -

For Works expenditure …………..

For Percentage charges……………

16.2.4 The percentages leviable should be adjusted month by month as the works

expenditure is incurred.

II. DISTRICT FUND WORKS, MUNICIPAL, CANTONMENT & PORT

TRUST WORKS
16.2.5 The accounting procedure prescribed in paragraphs 16.2.1 to 16.2.4 is also

applicable to Deposit Works executed on behalf of District Boards, Municipal &

Cantonment & Port Trust Works.

16.3 LOCAL LOAN WORKS

16.3.1 Expenditure on a local loan work, including the portion of expenditure on a joint

work, which is incurred against a sanctioned loan under orders of competent authority

should be accounted for under the head “Loans and Advances pertaining to the

Functional Major Head concerned” and shown in the Schedule of Debits to

Miscellaneous heads of Account, Form 76 supported by a Schedule of Works expenditure

in CPWA Form 64.

16.3.2 All charges debitable to a loan should be brought to account as they occur so that

the interest charges may be correctly calculated and adjusted in the Pay and Accounts

Office.

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Note – This rule applies also to the percentages (vide paragraph 16.2.3) leviable under the

rules which should, therefore, be adjusted monthly by inclusion in the Schedule of Work

Expenditure. (Form 64)

16.4 TAKAVI WORKS

I. Provision of Funds

16.4.1 It is not imperative, as in the case of a Deposit Work, that the estimated cost of a

Takavi Work shall be deposited by the person or persons interested in the work, before

any expenditure is incurred on it, as if the amount due is not received in cash direct from

them, it is recoverable through the District and Revenue Authorities in the same way as

arrears of Land Revenue. Endeavour should, however, be made to effect direct and

prompt recoveries of the probable cost of Takavi Works, as recoveries through the
District and Revenue Authorities cause considerable trouble and delay in adjustment.

II. Accounting of Expenditure

16.4.2 The transactions relating to Takavi Works should be recorded under Sub-head

“Takavi Works Advances, under 8550 – Civil Advances, 103 - Other Departmental

Advances”. They should be accounted for in the Schedule of Takavi Works, Form 66,

which shows the expenditure incurred on each work, the amount realized on account of it

and the outstanding balance of the account.

16.4.3 The rules in paragraphs 16.2.3, 16.2.4 and Note below paragraph 16.2.2 relating

to Deposit Works apply, mutatis mutandis to Takavi Works.

16.4.4 The accounts of all works of construction or of special repairs should be closed as

soon as the work is completed. Ordinary maintenance and repair works should, however,

be considered as completed on the31st October of each year (or any other date that may

be prescribed by the Administrative Ministry/Administrator concerned, as the last date of

the takavi year) and expenditure thereon incurred subsequently should be accounted for

as pertaining to a new work of the following year, so that the transactions and balances

relating to each takavi year may be kept distinct and separate.

III. Recovery through District and Revenue Authorities

16.4.5 The following procedure is prescribed for effecting recoveries through the District

and Revenue authorities, on account of the cost of individual Takavi Works, not covered

by cash deposits received direct from the cultivators concerned:-

(a) A certicate showing (1) the full name of the work, (2) the name and address of the

responsible cultivator or cultivators, (3) the authority for undertaking the work, (4) the

total expenditure incurred, (5) the amount (with full particulars if any), recovered in cash

and (6) the net amount still recoverable, should be prepared in duplicate by the Divisional

160
Officer, on the completion of the work (see paragraph 16.4.4) and submitted to the

Collector or Deputy Commissioner of the District concerned.

(b) On receipt back of the duplicate copy, duly accepted, the amounts accepted

should be credited on the authority of it to the Takavi Works Advances account by debit

to the detailed head ‘Cultivators’ subordinate to the relevant functional major head for

loans and programme minor head under “F Loans and Advances”

IV Waters Courses

16.4.6 The foregoing rules apply to such water courses only as are classed as Takavi

Works. The account rules relating to water course of other classes are given in Appendix

3.

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CHAPTER – 17

TRANSACTIONS WITH OTHER DIVISIONS, DEPARTMENTS AND

GOVERNMENTS

17.1 General Rules

17.1.1 The conditions under which one department of the public service may raise debits

against another department under the same Government or any department under another

Government for services rendered or articles supplied to it, are regulated by the directions

contained in Chapter 4 of the Government Accounting Rules, 1990.

Note 1: Subject to such general exceptions as may be authorized by Government in the

case of petty works, all charges connected with the construction and maintenance of

buildings, etc for the several Civil Departments of Government will be brought to

account as expenditure of the Public Works Department (Civil Works Section) or of the

Civil Department concerned, according as the administration of the Works rests with the

Public Works Department or is vested in, or is transferred by a general or special order of

Government from the Public Works Department to the Department using or requiring it.

Note 2: The value of Public stores issued to other departments is chargeable to them.

17.1.2 The cost of the land acquired by the Civil authorities on behalf of the Public

Works Department is debitable in the accounts of the latter as part of the cost of the

works for which the land is taken up; but when it is taken up for two or more noncommercial

departments conjointly, the charge is not divided, but is wholly debitable to

the department for which the greater part of the land was taken up, unless there are

special reasons to the contrary.

17.1.3 When a special officer is employed for the acquisition of land for the Public

Works Department, the expenditure on pay, allowances, etc of the special officer and his

establishment and any expenditure on contingencies is debitable to the Public Works

Department as part of the cost of works for which the land is acquired. When the land is

taken up by a civil officer, not specially employed for the work, only special charges

incurred in connection with the acquisition of the land on establishment, contingencies,

etc, will be borne by the Public Works Department as part of the cost of works for which

the land is acquired.

17.1.4 The licence fee of buildings hired for use as residences of Government servants of

any Civil non-commercial department is chargeable in the accounts of the Public Works

Department. In special cases, when the hired residences are, under the orders of

Government, placed under the charge of any other department, the charges on account of

rent in connection with residences will be disbursed and borne by that Department.

When any land or building not belonging to the Public Works Department is hired by

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another department to be occupied for any other public purpose, the rent is payable by the

department concerned, and Divisional Officers do not disburse rent for such premises
unless ordered by Government to do so.

17.1.5 When prison labour is employed on Public Works no charge is made by the Jail

department if the convicts are employed on Jail works, but in other cases the full market

value of the work performed, as certified by the Divisional Officer is charged to the

Public Works Department.

17.1.6 (1) Transfer of land from one Department of the Government to another shall be

on a ‘no profit no loss’ basis.

(2) Transfer of buildings and superstructures on such lands between Departments of

the Government shall be at the present day cost minus depreciation of the structure(s)

standing on the land. Valuation for this purpose shall be obtained from the Public Works

Department at the time of transfer.

(3) The allotment of land to, and recovery of cost of buildings from public sector

undertakings shall be at ‘market value’ as defined in Paragraph -2 of Appendix-11 of

General Financial Rules, 2005..

(4) The transfer of land and buildings between the Union and State Governments

shall be regulated by the provisions of Article 294, 295, 298 and 299 of the Constitution

of India and subsidiary instructions issued by the Union Government which are laid down

in Appendix 11 read with Rule 79(4) and Rule 279(5) of General Financial Rules, 2005.

Note 1: The term ‘department’ occurring in Sub-rules (1) and (2) above means a Ministry

or Department of the Union Government including Defence, Railways, Posts and

Telecommunications.

Note 2: Market value when applied to land may be defined as the price which the land

would fetch if sold in the open market subject to the ground rent or assessment shown

against it in the revenue registers, or, if no ground rent or assessment shown against it in

the revenue registers, subject to a ground rent or assessment levied at the rate at which
ground rent or assessment is actually being levied on similar land in the neighbourhood

excluding all cases in which such similar lands in the neighbourhood are held free of

ground rent or assessment at favourable or unfavourable rates of ground rent or

assessment. This is the market value which has to be credited or debited, as the case may

be, in the case of all transactions between the State Governments and the Union

Government or between the Union Government and State Governments or the Railways.

17.1.7 Services rendered, or articles supplied, by one division to another will be settled

through Advance Payments to be classified as Stores Advance, Service Advance or

Works Advance, as the case may be Procedure whereof is laid down in Appendix 7-

A of C.P.W.A Code.

163

17.1.8 Amounts owing by or to a department or departments of other Governments,

except for the supplies arranged in exceptional cases on or after 1st July 2005 by the

Department of Supply which are paid initially by the PAO(Supply), should be paid by

Cheques or Bank Drafts by the Division/PAO concerned. For inter-divisional and

Inter-Departmental transactions, see Appendix 7-A and Appendix 7-C of this code.

17.1.9 Cash recoveries made from employees, contractors, etc as also revenue realized

on behalf of other Divisions, Department or Governments, should be passed on to them,

the payments being made in the manner prescribed in paragraph 17.1.8. Cash obtained

from banks on cheques and cash receipts including surplus cash remitted to Banks, are

accounted for as remittance transactions.

17.2 ACCOUNTING PROCEDURE

17.2.1 (A) In terms of the provisions of Rule 140 of General Financial Rule,2005,

Ministries/Departments have been delegated full powers to make their own

arrangements for the procurement of goods. In case however a

Ministry/Department does not have the required expertise, it may project its

indent to the Central Purchase Organisation i.e D.G.S. & D with the approval of

Competent Authority. However in exceptional cases where the material is

purchased by placing indent on D.G.S.&D,the existing procedure for making

payment by the PAO of Division to PAO, Supply by operating Minus Credit to

Sub-head “Payment for Purchases through DGS&D” under Minor Head “129-

Material Purchase Settlement Suspense Account” below the Major Head “8658-

Suspense Accounts” and clearance thereunder on the adjustment of PAO Memo

by the Division would continue as hithertofore. (see Appendix 7-C of C.P.W.A

Code.

(B) Inter-Departmental transaction on account of supplies made or services rendered

to Cabinet Secretariat and Ministry of Defence has to be settled in cash, i.e., by

Cheques/Bank draft, the monetary settlement should be effected by debiting the

amount due, to the Suspense Minor Head “107 Cash Settlement Suspense

Account” below the Major Head “8658 – Suspense Accounts” pending clearance

on receipt of Cheque/Bank draft from the Division concerned. The detailed

procedure to be followed in this regard is given in Appendix 7-C(a).

Note 1 – Such percentage charges on account of supervision and establishment and

tools and plant as may be leviable under the rules, should also be included, by a

transfer entry in the amount transferred. See also paragraph 14.2.5.

Note 2 – The cost of workshop jobs need not be adjusted monthly, vide paragraph

14.2.4.

Note 3 – Since all inter-divisional transactions, irrespective of the fact whether the

Divisions fall within the same Circle of Account or in different Accounts Circles, are

164
required to be settled through “Advance Payment”, the procedure of which is laid

down in appendix 7-A of this code.

17.2.2. In cases, however, in which the transactions originate in another

Department of Central Government (e.g. Department of Supply) the responding

transfer/adjustment should be made on receipt of intimation of the advice, from the

Pay and Accounts Officer. In other cases, the Divisions should resort to direct

settlement by cheques/drafts. Accordingly, the Departments rendering supplies or

services to the Divisions should prepare a bill for the claims recoverable from the

Divisions and send them directly to the concerned Divisional Officers for payment by

cheque or bankdraft, as the case may be. This expenditure will also be accounted for

by the Divisional Officers in their accounts just like any other transaction arising in

their books.

17.2.3 The responding division should examine every transfer claim advised to it

for adjustment/payment, but it may not reject a transfer/claim because the voucher is

not in order or is wanting, nor may a transfer/claim advised be partly accepted and

partly rejected: it may be rejected altogether if it does not pertain to the division:

otherwise, it should be accepted provisionally in full and this dispute as to the amount

or as to other particulars of the transactions, should be settled separately in

consultation with the Officer who advised the transfer. See also paragraph 17.2.7.

Note – For procedure for payments against Civil Credit Notes. (Railways warrant and

Railway freight credit note), see Appendix 7-B.

17.2.4 (a) When a charge is transferred to another department or Government for

adjustment, the transfer is required to be supported either by the necessary vouchers,

complete in all respects or by a certificate signed by the Accounts Officer of the

Department originating the transfer to the effect that the payment vouchers have been
duly audited and passed in accordance with the rules. Divisional Officers are,

therefore, responsible for obtaining proper vouchers in support of all charges to

remittance heads in their accounts.

(b) Similarly, in the case of transactions between Public Works Divisions, including

the Divisions of other Governments, the system of Advance Payment should be

followed. claims should be supported by all necessary vouchers, except those relating

to work done for other Divisions, for which see paragraph 17.2.6(b).

Note : In the case of Stores issued from “Stock” by one Division to another Division

within the same circle of account, the supplying division will issue the stores on

receipt of cheque from the indenting Division as advance payment for the

procurement of stores. On receipt of cheque, supplying Division will enter the

cheque in the Cash book as debit to “Remittance into Bank” under the Minor Head

“102-Public Works Remittances” below the Major Head “8782-Cash Remittances

etc.” and credit to stock.

165

17.2.5 When a transaction originates in a Public Works Division, the necessary

transfer or preferment of claims should ordinarily appear in the accounts of the

division for the month in which the transaction occurred, but in the case of work done

in workshops the cost is adjustable in accordance with the rules in paragraphs 14.2.3

and 14.2.5.

17.2.6(a) In respect of work done in a division for other departments, or

Governments the procedure to be followed has been explained in Appendix 7-C

or/and Appendix 7-D, as the case may be.

(b) As regards work done in a Public Works Division on behalf of another Division,

including the Divisions of other Government the claims should be settled by the
Divisions amongst themselves without the intervention of the Pay and Accounts

Officer for the settlement of inter-divisional transactions, procedure for Advance

Payment has already been introduced w.e.f. 1.4.1993 by doing away the operation of

Suspense Head “107-Cash Settlement Suspense Account”. The Requisite vouchers

should, however, be sent to the Pay and Accounts Officer with the Monthly account,

duly supported with Form CPWA 64. If, as a result of check in accounts office, it is

noticed that an excess payment has been made over and above the Advance Payment

the Division will claim the amount of excess from the originating Division by

operating on the Suspense head “107-Cash Settlement Suspense Account’, as a

special case, treating the item as an original transaction. On the contrary, if short

payments are noticed in check in accounts office, the originating Division will send a

supplementary claim for the balance to the other Division.

In order to enable the Public Works Divisions to settle the excess/short payments

in the manner indicated in this paragraph, the Pay and Accounts Officer will notify

the discrepancies noticed in check in account offices both to the originating and the

responding Divisions.

Note 1: For the purpose of this paragraph, work done includes jobs executed in

workshops.

Note 2: In the case of works, which are assessable to percentage recoveries on

account of establishment, tools and plant, etc, that amount of the estimate and

appropriation for the work should be rateably broken up into two parts to represent

respectively, the works expenditure and the percentage charges.

Note 3: The provision regarding audit before intimation of transfer may be relaxed

in the case of any item appearing in the accounts for March and requiring adjustment

with another Government (other than a Public Works Division) vide paragraph
22.4.20.

17.2.7 In cases in which transactions originate in Department of Supply, and the

intimations of transfer/adjustment of debits or credits are received through the Pay

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and Accounts Officer (paragraph 17.2.2), the Divisional Officer should examine such

transfers as expeditiously as possible and report all his objections to the Pay and

Accounts Officer, whether the transfer is brought to account provisionally or rejected.

17.2.8 The procedure prescribed in paragraph 17.2.7 applies mutatis mutandis to

transfer transactions not relating to the execution of works, with (1) Ministry of

Railways (2) Department of Posts and (3) Department of Telecommunications.

17.2.9 The Divisional Accountant should see that there is clear authority of the

responsible disbursing officer of his division for claims/transfer advised to other

divisions, departments or Governments, and that no charge advised by another division,

department or Government is finally paid/adjusted until all the necessary vouchers

[except those relating to work done vide paragraph 17.2.6 (b)] have been received and

have further been completed by obtaining thereon, from the responsible disbursing

officers of the division, the classification of the charge as attested by their dated initials.

He should further see that when transfer/claim advised to the division for

adjustment/payment is responded to provisionally, the objection raised thereon is pursued

with a view to ensure speedy settlement

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CHAPTER 18 PAY AND ALLOWANCES

18.1 Introductory

18.1.1 Pay and allowances of Government servants of the P.W. Division if not charged directly

to works, as well as, personal advances, except those payable by the Pay andAccounts Officer
referred to in para 6.2.2 sanctioned by competent authority are drawn by means of cheques [vide

paragraph 3.2.1(a)] and in accordance with the procedure prescribed in the C.G.A.(R&P) Rules,

1983 which are applicable to the C.P.W.D. subject to the special rules laid down in this regard.

Note 1 – The sanction of competent authority to personal advances may, if preferred be obtained

in the form of counter-signature on the bill itself before it is passed by the Divisional Officer for

payment.

18.2 PREPARATION OF BILLS

I. General

18.2.1 Claims of all Government servants, Gazetted or non-gazetted should be preferred by

Head of Offices under whom they are employed, and the latter should make proper

arrangements for disbursing the amounts so drawn.

Note – For the purpose of this rule, the Divisional Officer is treated as the “Head of Office” of

the entire establishment employed in the division.

18.2.2 A separate pay bill should be prepared for:-

(i) establishments whose charges are debitable to different heads of accounts;

(ii) personnel to whom salary is payable individually by cheques and

(iii) group’D’ employees.

(iv) Government employees joining Government Service on or after 01-01-2004 and covered

under the New Pension Scheme’2004.

Each of the bills may be prepared by including both permanent and temporary establishments

and divided into separate sections comprising the establishments and indicating the description

of each section prominently, alongwith sanctioned number of posts included therein (in the case

of large establishments, separate bills may be prepared for different sections, if administratively

found convenient). While for permanent posts the sanctioned strength need only be indicated at

the top of each section of posts, in the case of temporary posts, the number and date of the

sanction letter shall also be indicated. In cases where sanction for continuance of posts has been
applied for, the drawing and disbursing officer shall indicate this fact in the bill and draw pay

and allowances of the persons concerned at earlier rates.

Except as provided in sub-rule (4) of Rule 66 of C.G.A.(R&P) Rules, 1983, the name of every

incumbent shall be shown against each post and the rates of pay and allowances claimed for

each shall also be shown. When pay and allowances are drawn for a portion of a month only,

the actual period for which these payments are claimed shall be mentioned against the concerned

Government servant in the body of the bill. The other instructions printed on the Form of the

bills should also be carefully followed.

Note – In the CPWD Divisions as well as the divisions of other Departments where the

Divisional Officers have been authorized to draw pay and allowances of officers and staff by

cheques [vide paragraph 3.2.1(a)] the following procedure shall be followed for preparation,

checking of bills and for drawal of cheques therefor:-

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(a) The Administrative Branch of the Division shall be responsible for preparation of bills.

That branch shall maintain the Bills Register in G.A.R. 9 as well as other subsidiary registers

connected with the drawal of bills. The bills shall be presented by the Administrative Branch to

the Accounts Branch headed by the Divisional Accountant for check and payment of the bills.

(b) The Accounts Branch on receipt of the bills from the Administrative Branch will conduct

the required checks as laid down in the CGA(R&P), 1983.

(c) After check of the bills, the Accountant will record the pay order. After getting the pay

order signed by the Divisional Officer, cheques by designation of the D.D.O., will be drawn in

regard to the bills of officers desiring payment in cash and crossed Account Payee cheques will

be drawn in the name of the payees in case of officers desiring payment by Cheque. In either

case the cheques will be for the net amount payable and an entry in Form CAM 10 will be made.

Similarly, for claims to Travelling Allowance, LTC, separate bills should be prepared.

(d) The D.D.Os / C.D.D.Os will prepare separate Pay Bill Registers in respect of
Government servants joining Government service on or after 01-01-2004. The

DDOs/CDDOs will have to prepare separate Pay Bills in respect of these Government

servants and will send the same with all other schedules to the Pay and Accounts Officer so

as to reach him on or before 20th (15th in the case of DDOs/CDDOs situated in far flung

areas not easily accessible) of the month to which the Bills relate. Cheque Drawing DDOs

may note that henceforth in respect of Government servants joining service on or after 01-

01-2004 they will only prepare Pay Bills and not make payment. Such Bill will be sent by

them to the Pay and Accounts Offices for pre-check and payment.

(e) The DDO/CDDO will prepare a recovery schedule in duplicate in the prescribed Form

for the contributions under Tier-I and attach them with the Pay Bills. The amount of the

contributions under Tier-I should tally with the total amount of recoveries shown under the

corresponding Column in the Pay Bill.

(f) It may be noted that along-with the salary bill for the Government servants who join

service on or after 01-01-2004, the DDO/CDDO shall also prepare a separate bill for drawal

of matching contributions to be paid by Government creditable to Pension Account.

(g) The bill for drawal of matching contribution should also be supported by schedules of

recoveries in prescribed Forms.

(h) On receipt of the Salary Bills in respect of Government Servants joining service on or

after 01-01-2004, PAO will exercise usual checks and pass the bill and make the payments.

After the payments is made and posting is done in the detailed Posting Register, one set of

schedules relating to Pension Contributions will be detached from the Bills as is done in the

case of other schedules such as Long Term Advances etc.. The Schedules will then be

utilized for posting the credits of Contributions in the Detailed Ledger Account of the

individual.

(i) The employees contributions under Tier-I and Tier-II, and Governments Contributions

should be posted in different Columns of the individual ledger account (to be maintained in
the prescribed format) and Broadsheet tallied with the accounts figures as being done in the

case of GPF/Long Terms Advances.

(j) The accounts should not be mixed with GPF Accounts and these records/ledger accounts

should be independent of GPF accounts maintained in the case of pre-01-01-2004 entrants.

(k) The PAO will consolidate the information available in the New Scheme Schedules

received from the various DDOs and forward the same in floppy in the prescribed form to

Principal Accounts Office by 12th of the month following the month to which the credit

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pertains. Principal Accounts Office in turn will consolidate the information and send the

same in electronic form to the Pension Regulator appointed by the Govt. for the purpose by

the 15th. Till The Regulator is appointed by the Govt. the same will be sent to Central

Pension Account Office by the above mentioned date.

II. Classification

18.2.3 Bills paid at the counter of Pay and Accounts Office incorporated in the accounts are

kept by the Pay and Accounts Officer. Drawing Officers are, however, responsible for giving

sufficient particulars on the bill necessary for determining the accounts classification (vide Rules

1 and 2 of Appendix 4).

Bills paid by drawal of cheques by the Divisional Officer of C.P.W. Division of the

Departments should, however, be incorporated in the monthly accounts of the Division in

accordance with the procedure prescribed in Chapter 22.

Note – The cost of any special establishment for acquisition of land entertained under orders of

Government by a Civil Officer acting as a Public Works Disburser, is chargeable as the cost of

the works concerned and not as general establishment charges, vide paragraph 17.1.3

18.2.4 If as permitted by Rule 65 of CGA(R&P) Rules, 1983 emoluments upto the date of

transfer are not drawn before a Government servant proceeds on transfer, emoluments for the

whole month may be drawn in the new appointment, the allocation of the charge to the old and
new appointments being clearly specified on the bill.

Note 1 – The last pay certificate should give all the necessary information so that the allocation

may be correctly noted by the drawing officer in the bill of the new office.

Note 2 – Arrears of pay and allowances of such members of the staff as have been transferred

and in respect of whom last pay certificates have already been issued, should in no case be

drawn by the Division from which they have been transferred.

18.3 DISTRIBUTION OF PAY AND ALLOWANCES

I. General

18.3.1 Special attention is invited to Rule 92 of C.G.A.(R&P) Rules, 1983 prescribing the

procedure for distribution of pay and allowances to establishments. Acknowledgements should,

as far as possible, be taken on office copies of bills, but where this may not be convenient or

advisable as in the case of scattered establishments, consolidated receipts on Acquittance Roll,

Form G.A.R. 24, may be obtained separately for each set of payments made at one place or at

one time.

Note Acquittance rolls and receipted office copies of bills are not required to be submitted to

the Accounts Officer, but as they are important records, they should be stamped “paid” and

preserved carefully for such periods as may be prescribed by Government.

18.3.2 Cash drawn on pay and travelling allowance bills of establishments should not be mixed

with regular cash balance of the Department, if any, vide paragraph 6.2.4. A cash book in Form

GAR 3 should be maintained for pay and travelling allowance bills in accordance with Rule 13

of CGA(R&P) Rules, 1983. An account of undisbursed pay and allowances should be kept in a

Register in Form G.A.R.25. Entries of the total and particular amounts of undisbursed pay and

allowances may be made against each bill serially and subsequent payments thereof entered in

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the appropriate column of the Register and the Cash Book, each entry being attested by Drawing

and Disbursing Officer. From this Register, an abstract of amounts remaining undisbursed for
three months should be prepared to ensure their refund, either in cash or by short drawal from

the next bill.

18.3.3 A bill register in the form GAR 9 should be maintained by all Heads of Offices who are

authorized to draw money on account of pay and allowances etc by Cheque on bills signed by

them. The register should be reviewed monthly by a Gazetted Officer and the result of review

recorded thereon.

II. Miscellaneous Recoveries from Establishment

18.3.4 Normally the Security is to be obtained in the form of fidelity bonds as per the procedure

laid down in Rule 275 of General Financial Rules, 2005. However, recoveries on account of

security deposits of employees made in cash when their pay is disbursed, should be credited in

the Cash Book of the disbursing officer.

Note 1 – The Administrative Ministry/Administrator concerned in consultation with the

Accounts Officer may, however, prescribe that security deposits should be deducted from pay

bills.

Note 2 – The rule in this paragraph applies mutatis mutandis to all recoveries from employees

which are creditable under the rules of same head in the compiled accounts of the division.

18.4 SPECIAL ARRANGEMENTS TO PREVENT DELAYS IN PAYMENTS

18.4.1 To prevent abnormal delays in payments to establishments in exceptional cases, pay and

allowances of subordinates employed in out of the way places may be remitted to them by postal

money order at Government cost/Bank Draft at the nearest branch of Public Sector Bank under

the orders of the Administrative Ministry/Administrator concerned.

18.4.2 If the encashment of a bill for an advance on transfer is likely to delay a transfer which is

urgently necessary in the public interest, the advance may be made from the permanent cash

imprest (if any), works imprest or other available cash in the hands of the disbursing officer

concerned, pending recoupment when the bill is subsequently passed and encashed. In the

accounts of such cash, the amount advanced should not be charged off as a final transaction, but
recorded as a temporary advance, so that the amount may continue to form part of the cash

balance for which the disbursing officer is responsible.

18.5 COMMUNICATION OF SANCTION TO PAY AND ACCOUNTS OFFICER

18.5.1 All orders revising sanctioned scales or sanctioning the creation or abolition of

permanent or temporary appointments should at once be communicated to the Pay and Accounts

Officer. Changes in the personnel of the establishments and in their emoluments should be

indicated in pay bills and absentee statements by the authorities preparing those documents, who

are responsible that orders of competent authority are obtained in each case as required by the

rules.

18.5.2 In the case of all transfers of divisional, sub-divisional or other executive charges, a

report of transfer of charge should be prepared in the manner prescribed by Government and

sent to the Pay and Accounts Officer through the Superintending Engineer. Whenever the

171

transfer of charge is prolonged so that two Government servants may be entitled ‘to draw pay

and allowances simultaneously for the same appointment (see Audit Instruction under

Fundamental Rule 107), the Superintending Engineer should intimate to the Pay and Accounts

Officer if the time taken is reasonable and the relieving officer may be considered as on duty for

the period. If, however, the Superintending Engineer considers the time taken in making over

and receiving charge to be excessive, the relieving officer must be treated as if he were on leave

or on joining time, etc., as the case may be, for as much of the time as may be regarded as

excessive.

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CHAPTER 19- CONTINGENT CHARGES

19.1 Modes of obtaining Cash

19.1.1 Cash required to disburse contingent charges is obtained from accredited bank

by cheques, in the same way as cash required for works payments and the
charges are incorporated in the monthly account of the division.

19.2 General Rules

19.2.1 The rules in Part III of CGA (R&P) Rules 1983 apply generally to the public

Works Department to the extent that they may not be inconsistent either with

the authorized method of obtaining cash for contingent charges (vide

paragraph 19.1.1) or with any of the special rules in this Code.

19.2.2 The expression contingent charges a used in Public Works accounts does not

include charges which under the accounting procedure indicated in Appendix 2

are classified under some other head of expenditure, e.g., Construction, Repairs

and Machinery and Equipment.

Note – Charging of expenditure of contingent nature which falls within the purview of

this Chapter to the contingencies of work is strictly prohibited and any breach of this

should be brought to the notice of appropriate authority concerned by the Accounts

Officer.

19.2.3 If the contingent charges of a division excluding special contingencies (vide

Rule 98 of CGA. (R &P) Rules, 1983), during a month, exceed monthly limit

for such charges fixed by the Administrative Ministry/Administrator

concerned, the bill for the month should be submitted to the Superintending

Engineer, for sanction, which will be signed by that officer countersigning the

bill.

19.2.4 Contingent charges and Grants-in-aid may be included in the same bill, but the

abstract of the bill should show the total charges for each class separately.

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19.3 Special Rules

19.3.1 The Accounts procedure for contingent charges will be as follows:-

(a) Payments made should be brought to account, in the first instance, in cash

books or imprest cash accounts, like works payments.

(b) At the end of the month all contingent charges (including Stock and

adjustment transactions) should be consolidated in a bill in form GAR 31

(headed ‘Not Payable’) for submission to the Accounts Officer with the

Monthly Account. Particulars of the charges need not be entered in this bill

except in the case of miscellaneous items which do not fall under one of the

classified sub-heads for specific charges. Vouchers which are not required to

be submitted to Accounts Officer should be stamped ‘Paid’ and cancelled by

the Drawing and disbursing Officer.

(c) A register of contingent expenditure in Form GAR 27 shall be kept in each

office and the initial of the Divisional Officer or of a Gazetted Officer to whom

this duty has been delegated by him, shall be entered against the date of

payment of each item, who will also ensure that the expenditure is kept within

the budget allocation.

19.3.2 Petty payments should be made out of the regular cash or imprest balances of

the division and not out of undisbursed balances of cash for payment of

establishment charges. Other payments should be made by cheques.

Note- Crossed Government Account’ cheque in favour of the Post master or State Bank

of India branches which are authorised to sell stamps may be drawn or obtained by

drawing and disbursing officers from Pay and Accounts Office by preferring a bill

indicating the value of postage stamps of various denominations required, and giving a

certificate that the stamps will be used for postage on bonafide communication in public

service and that the expenditure could not be avoided.

.
174

CHAPTER-20 DIRECTION AND OTHER SPECIAL OFFICES

20.1 Introductory

20.1.1 The rules in this Chapter apply only to the offices of the Chief and

Superintending Engineers, Superintendents of works and other special officers

not being Divisional Officers or their subordinate officers. These offices are

described as special offices in this Chapter.

20.1.2 The head of a special office is not concerned with the actual execution of

works, with the disbursement of money or with the provision or custody of any

materials, otherwise than possibly as an officer of control. If, however, he is

required at any time to assume an executive charge, the monetary and stores

transactions of such charge should be kept distinct from the transactions of his

special office, and accounted for under the rules applicable to divisional

Officers.

20.2 Receipts

20.2.1 Heads of special officers do not ordinarily realise any departmental receipts,

any petty amounts received occasionally should be remitted at once into the

accredited bank in accordance with the procedure prescribed in Rule 21 & 26

of C.G.A.(R&P) Rules, 1983.

Note For recoveries from the staff, see paragraph 20.3.5.

20.3 Payments

I. Introductory

20.3.1 The monetary transactions of heads of special offices are practically confined

to payments of office expenses and pay and allowances of themselves and the

members of their offices. These may be divided into two distinct groups:-
1.

2.

Pay and allowances.

Contingent charges.

20.3.2 Cash required to meet these payments is obtained by bills drawn on Accounts

Offices/Divisional Officer under the rules in the following paragraphs.

II Pay and Allowances

20.3.3 The rules in Chapter 18, which are applicable to Divisional Officer apply

mutatis mutandis to special officers keeping in view the method of drawal of

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funds. The following rules are peculiar to them.

20.3.4 Establishment bills as prescribed in rule 66(2) of CGA (R&P) Rules, 1983 will be

presented for encashment at the Zonal PAO at the places where the office of the

Accounts Officer is located and the authorized division at the places other than

the place of office of Accounts Officer.

20.3.5 Recoveries from the establishment of special offices are not subject to the rules in

paragraph 18.3.4. They should, as far as possible, be made by deduction from

their bills. When, however, the amounts recovered have to be paid into a court of

law, or into the Post Office Savings Bank as security deposits, recoveries should

be made in cash at the time of disbursement of pay and the amounts recovered,

should be forthwith remitted.

III Contingencies

20.3.6 The general rules relating to contingencies are given in section III of Part III of

CGA (R&P) rules, 1983, and the method of obtaining cash will be same as in

case of establishment bills.

20.3.7 Charges for new supplies of, and repairs to articles of the classes which in the

case of executive officers are classified under the head ‘Machinery and

Equipment’ are treated as contingent charges, etc., in the case of special officer.

Examples – Scientific instruments and drawing materials, camp equipage, motor cars, etc.

20.3.8 The accounts procedure prescribed in Chapter 7 for Tools and plant of divisional

offices need not be observed in special offices in respect of the articles referred to

in paragraph 20.3.7 though these will otherwise be treated as Tools and Plant for

the purpose of the Public Works Department Code. Suitable registers showing

the receipt, disposal and balances of the articles should, however, be maintained.

Note – Transfer of any article of this class to a divisional office/other direction office will be

regulated in accordance with the orders issued in this regard.

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CHAPTER-21

ACCOUNTS RETURNS OF SUB-DIVISIONAL OFFICERS.

21.1.1 Subject to such special arrangements as may be authorised by the Administrative

Ministry/Administrator concerned after consultation with the Accounts Officer,

to apply to cases where a Sub-divisional Officer is not authorised to make

disbursements, the accounts of sub-divisional Officers should be kept in

accordance with the following rules.

21.1.2 A Sub-divisional officer maintains the initial account records of stores as

described in Chapter 7 as well as connected records in connection with the works

in progress. All these records are as a rule written up as the transactions take

place. Sub-divisional Officer is not, however, required to consolidate the

transactions into a compiled account, this work being done in the divisional office

for the entire division.

21.1.3 Within three days of the date on which the accounts of a month are closed in the

Sub-Divisional Office, Transfer Entry orders, Form 53, relating to the accounts of

the month, excluding those proposed from time to time, vide paragraph 8.1.4 will

be sent to the Divisional Office with a covering list in form A3.

21.1.4 Other Accounts returns which Sub-divisional Officers should submit to the

divisional office, are the following.

(a) Monthly:-

(i) “Statement of Receipts, Issues and Balances of Road Metal”, Form 16 vide

paragraphs 7.4.1 and 7.4.2.

(ii) Such statements or reports (vide paragraph 9.5.6.) in connection with

recoveries of Licence Fee of buildings and lands, as the Divisional Officer may

require the Sub-divisional Officer to prepare.

(b) Occasional:-

(i) Reports of verification of stores (including materials at site of works )

immediately after each verification.

(ii) Tools and Plant Ledger-on such dates as may be prescribed by the Divisional

Officer.

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CHAPTER 22 ACCOUNTS OF DIVISIONAL OFFICERS

22.1 Introductory

22.1.1 The cash and stock accounts of the divisional office for a month are closed on

the last working day of the calendar month.

22.1.2 The Transfer Entry Book for a month should be closed as soon as possible

after the expiry of the month, but before this is done, all necessary transfers, e.g., those

relating to the levy of the prescribed percentages for establishment, tools and plant,
supervision charges, etc., should be made.

Note: The transfer entry relating to the levy of percentages for establishment, tools

and plant accounts, audit charges and pensionary charges is effected on a single order of

the Divisional Officer in Form C.P.W.A 62, the special form prescribed for the purpose,

vide paragraph 22.4.3.

22.1.3 The cash and stock accounts of the entire division, as also all transfer

transactions should be scrutinized by the Divisional Accountant before they are

incorporated in connected registers, schedules and the Monthly Account.

Note 1: The Divisional Officer should ensure that, as far as possible, the examination

of all claims included in bills presented for payment direct at Pay and Accounts Office;

is made by the Divisional Accountant.

Note 2: In all matters connected with the personal claims of Government servants,

the Divisional Officer should obtain expert advice and help of the Divisional Accountant.

In all cases of doubt, however, the advice of the Chief Controller of Accounts through

his Pay and Accounts Officer should be sought.

22.2 Scrutiny of Accounts

22.2.1 The Divisional Accountant should examine the accounts returns of Subdivisional

Officers as referred to in Chapter 21, to see:-

(i) that they have been received in a complete state,

(ii) that all sums receivable are duly realized, and on realization remitted to

Divisional cash Chest for proper accounting.

(iii) That all bills which are required to be prepared/submitted by the S.D.O. are

prepared in accordance with the rules applicable to each case and are covered

by sanction and appropriation. It should be seen in particular that, on the basis

of rates sanctioned by competent authorities, and of facts, (as to quantities of

work done, supplies made, etc., or services rendered) certified by authorized

officers, the claims presented for payment are valid and in order.

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Note: It is not necessary that the Divisional Accountant should check personally the

arithmetical accuracy of all bills and accounts, but he is responsible that cent per cent

check is exercised efficiently under his supervision.

22.2.2 The Divisional Accountant should exercise a similar check from day to day,

in regard to the transactions recorded direct in the cash and stock accounts of the

divisional office.

The Divisional Accountant should affix his dated initials after the last entry of the day’s

transaction in the divisional cash book/stock accounts, in token of check.

22.2.3 Every payment should be recorded, and a receipt for the same so obtained,

e.g., see paragraphs 10.2.18 and 10.2.19, that a second claim against Government on the

same account is impossible, and if it represents a refund of a sum previously received by

Government it should also be seen that the amount paid is correctly refundable to the

payee.

22.2.4 The Divisional Accountant is responsible that every order or sanction

affecting expenditure to be accounted for in the Monthly Account, is noted at once in a

suitable register (or other account record), preferably one wherein the expenditure

incurred against it can be watched readily. General sanctions to estimates and

appropriations for works should be noted in the Register of Works in Form C.P.W.A 40,

and sanctions to fixed charges of a recurring character, e.g., those relating to the

entertainment of work-charged establishments should be entered in the Register of

Sanctions to Fixed Charges, Form C.P.W.A 58. For sanctions to special payments

chargeable to the accounts of works, and other miscellaneous sanctions, Form C.P.W.A
59, Register of Miscellaneous Sanctions will be found suitable.

Note 1: Forms C.P.W.A 58 & 59 may also be used in respect of sanctions to

contingent expenditure when this is not brought to account in the Monthly Account, but

separate pages of these registers should be set aside for this purpose.

Note 2: Sanctions to estimates for works should be entered in the Register of Works

and a collective register of all sanctioned estimates be maintained in such form as may

have been prescribed by Government.

22.2.5 If against a single sanction, disbursing officer of two or more divisions have

to operate simultaneously, the orders of the Superintending Engineer or higher authority

should be taken. In such cases it may be advisable to have a separate working estimate,

or other sanction, to cover the transactions of each disbursing officer, and for the purpose

of bringing the expenditure to account, these should be treated, as far as possible, as

independent transactions pertaining to the same group of works or the same project. If

this is not possible, special arrangements must be made for the check of the total

expenditure against the sanction.

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22.2.6 It is one of the functions of the Divisional Accountant to see that expenditure

which is within the competence of the Divisional Officer to sanction or regularize, is not

incurred, as a matter of course, under the orders of subordinate officers, without his

knowledge. All such items of expenditure should at once be brought to the notice of the

Divisional Officer and his orders obtained and placed on record. See also Paragraph

4.2.5.

22.2.7 The works expenditure should be checked with the estimates to ensure that the

charges incurred are in pursuance of the objects for which the estimate was intended.

The Divisional Accountant is responsible for checking the expenditure with the estimated
quantity of work to be done, the sanctioned rate, and the sanctioned cost, so that he may

bring to notice all deviations from the sanctioned estimate.

22.2.8 When a recovery has been ordered to be made from a contractor or other

person, which cannot be watched through a suspense or other account specially

prescribed for the purpose, the order should be noted at once in a register of recoveries in

Form C.P.W.A 95, opened specially for the purpose, so that the amounts recovered from

time to time (with particulars of the accounts concerned) may be recorded against it, and

prompt compliance with the order watched.

22.2.9 It is permissible to take in reduction of the expenditure on works in progress,

certain recoveries of expenditure (vide paragraph 9.1.3), e.g., sale proceeds of surplus

materials and plant acquired specially for any work, or of materials received from

dismantled structures, irrespective of whether the estimates for works make allowance for

such recoveries or not. The amounts of such receipts are, however, not available for

expenditure in excess of that authorized in the estimate for the work and the Divisional

Accountant should see that, without the orders of competent authority, the gross

expenditure authorized is not exceeded, or surplus receipts realized are not utilized

towards additional expenditure. He should, at the same time, watch the receipts, with a

view to bring to the Divisional Officer’s notice and obtain that officer’s orders on all

marked deviations from the provision for such credits in the estimates of works.

Note – The Divisional Accountant should also see that savings due to abandonment of

parts of a work, as evidenced by the quantities of the work executed or otherwise, are not

utilized towards unauthorized expenditure.

22.2.10 After check, every voucher should be enfaced with the word “checked”

over the dated initials of the Divisional Accountant, as well as of any clerk who may have

applied a preliminary check. Vouchers not required to be submitted with Monthly

Account (vide paragraph 22.4.17) should be “Cancelled” by means of a perforating or

endorsing stamp and kept carefully, to be made available for test audit whenever

demanded by Internal/Statutory Audit.

Note 1: Vouchers relating to contingencies, which do not amount to more than rupees one

thousand should be dealt with-in the manner indicated in the certificate of the disbursing

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officer printed on Form G.A.R. 32 read with Rule 109 of CGA(R&P), Rules,1983 as

amended from time to time.

Note 2: Stamps affixed to vouchers should be so cancelled that they cannot be used again,

and if with this object they are punched through, care should be taken that the

acknowledgement of the payee is not destroyed thereby.

Note 3: Vouchers relating to new supplies of tools and plant should be completed by

noting on them the name of the month in the accounts of which the articles acquired were

brought on to Form C.P.W.A 13, Tools and Plant Received Sheet.

22.2.11 The result of the examination of accounts and returns such as ‘Stock and

Sale Account ( Form C.P.W.A 19)’ ‘Material at site Account ( Form C.P.W.A 35)’ etc.,

received from Sub-divisional Officers, should be intimated to them in all cases in which

it is necessary to obtain further information, certificates etc or to direct them to correct

the relevant records of their offices or avoid the recurrence of any irregularity. The

procedure to be observed may be prescribed by the Divisional Officer. The records

connected with the results of the examination should be called for from the Sub-division

and made available to Inspecting Officers/Audit Officers at the time of audit for review.

22.3 Settlement of Accounts with Banks

22.3.1 The remittances made into the accredited Bank as well as cheques drawn on them,

by Public Works Division will be accounted for under the Sub-heads “Remittances into
Bank” and “Public Works Cheques” respectively below the Minor Head “102 – Public

Works Remittances” subordinate to Major Head “8782 – Cash Remittances” etc between

officers rendering accounts to the same Accounts Officer shall be entered in the

“Schedule of Reconciliation of Cheques & Remittances (Form C.P.W.A 51 of

CPWA Code)” .

22.3.2 The Dealing Branch of the accredited Bank will prepare daily Payment and

Receipt Scrolls in quadruplicate separately for each Divisional Officer following the

procedure as laid down in chapter 23 on Banking Arrangements. The Dealing

Branch of the Bank will send payment scrolls and Receipt Scrolls in duplicate

alongwith Paid Cheques/Challans to the designated Focal Point Branch of the Bank.

Third copy of the above mentioned Bank Scrolls without Paid Cheques/Receipted

Challans will be sent to the Divisional Officer by the Dealing Branch and the fourth

copy of the Scrolls shall be retained by the Dealing Branch for its own records. No

document is to be sent to the Pay and Accounts Officer of the Division concerned by

the Dealing Branch of the accredited Bank.

In other words the role of the Dealing Branch shall confine to prepare

Payment Scrolls/Receipts Scrolls on daily basis in quadruplicate and pass on such

scrolls in duplicate alongwith Paid Cheques/Receipted Challans to its designated

Focal Point Branch and the third copy without supporting Paid Cheques/Receipted

181

Challans to the Cheque Drawing and Disbursing Officer i.e., the Divisional Officer

and retaining the fourth copy for its own record.

The Focal Point Branch of the accredited Bank presently the State Bank of

India on receipt of Bank Scrolls together with the related instruments i.e., Paid

Cheques/Receipted Challans, will prepare in triplicate the “Main Scroll” Divisionwise

and transmit two copies of the “Main Scroll” along with original copy of the

Scrolls duly supported with Paid Cheques/Receipted Challans received from the

Dealing Branch to the Pay and Accounts Officer of the Division concerned on a dayto-

day basis retaining third copy for its own record. On receipt of “Main Scroll” in

duplicate from the Focal Point Branch, the Pay and Accounts Officer of the Division

concerned, after verification of related documents viz the Paid Cheques/Receipted

Challans will return the second copy of the “Main Scroll” duly certified without

documents to Focal Point Branch within 24 hours and carry out the following

adjustments in his Accounts:-

22.3.3

(a) For the adjustment of Payment Scroll:

P.A.O. of the Division concerned will afford Minus Credit to Sub-head

“Public Works Cheques” under the Minor Head “102-Public Works Remittances”

below the Major Head “8782 – Cash Remittances and adjustments between officers

rendering accounts to the same Accounts Officer” per Contra Credit to Minor Head

“108-Public Sector Bank Suspense” below the Major Head “8658 – Suspense

Accounts.” The credit under Minor Head “108 – Public Sector Bank Suspense”

below the Major Head “8658 – Suspense Accounts” will be cleared by the Principal

Accounts Officer of the Ministry of Urban Development by Minus Credit to the

above mentioned Suspense Minor Head per Contra Credit to the Major/Minor/Subhead

“8675 – Deposits with Reserve Bank” “101 – Central (Civil) – Reserve Bank

(PSB) on receipt of “Payment Put Through Statement” from the Reserve Bank of

India.

22.3.4

(b) For the adjustment of Receipt Scroll

P.A.O. of the Division concerned will adjust the Receipt Scroll by Debit to

Minor Head “108 – Public Sector Bank Suspense” below the Major Head “8658 –

Suspense Accounts” per Contra Minus Debit to Sub-head “Remittances into Bank”

under the Minor Head “102 – Public Works Remittances” below the Major Head

“8782 – Cash Remittances and adjustments between officers rendering accounts to

the same Accounts Officer”. The Debit under the Minor Head “108 – Public Sector

Bank Suspense” below the Major Head “8658 – Suspense Accounts” will be cleared

by the Principal Accounts Officer of the Ministry of Urban Development by Debit to

the Major/Minor Sub-head “8675 – Deposits with Reserve Bank” “101-Central

(Civil) – Reserve Bank (PSB) and by minus Debit to Minor Heads 108 – Public

Sector Bank Suspense” below the Major Head “8658 –

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Suspense Accounts” on receipt of “Receipt Put Through Statement from Reserve

Bank of India.

22.3.5

(c) Adjustment of the copy of the Bank Scrolls received by the Divisional

Officer from the Dealing Branch of the accredited Bank.

On receipt of the above mentioned copy of the Bank Scrolls without related

documents viz the Paid Cheques/Receipted Challans the Divisional Officer will

effect reconciliation of the transactions indicated in the Receipt Scroll and Payment

Scroll in Part I – Cash Remitted and Acknowledged” and Part II – Cheques issued

and paid respectively in the Schedule of Reconciliation of Cheques and

Remittances” in Form C.P.W.A 51 to be sent by the Divisional Officer along with

Monthly Account to the Pay & Accounts Officer of his Division for reconciliation

purposes. The Divisional Officer should also prepare and furnish list of cheques
issued but not encashed and remittances made but not accounted for during the

month as well as cheques issued and remittances made during the previous months

accounted for in the bank scroll during the month on hand. The monthly Divisional

Accounts, will have to be supported within the above “Schedule of Reconciliation of

Cheques drawn and Remittances” made into accredited Bank.

22.3.6 P.A.O. of the Division on receipt of Form C.P.W.A 51 along with Monthly

Account from the Divisional Officer will reconcile the figures of Bank Scrolls

booked in his account with those reported by the Divisional Officer in CPWA Form

51.

Note: For detailed procedure for the settlement of Accounts with Bank, see chapter

23 of this Code.

22.4 COMPILATION OF ACCOUNTS

1. Monthly Accounts

(a) Introductory

22.4.1 Before the actual compilation of the various schedules and schedule dockets, etc

is undertaken, the Abstract Book, Form C.P.W.A 81 may be written up from the original

Cash Book, Summaries of Stock Receipts and Indents and the Transfer Entry Book in

accordance with the instructions printed on the standard Form. The book will consolidate

all the transactions of the division and will thereby facilitate the location of errors and

omissions made in the compilation of the Monthly Account from the Schedules and also

serve as an independent check over the accounts so compiled. The Monthly Account

183

shall be submitted to the Pay and Accounts Officer by 8th of the succeeding month

to which the Account pertains.

(b) Schedule Dockets

22.4.2 As cash vouchers and transfer entry orders, relating to (i) charges on works other

than percentages charged for establishment, tools and plant, etc, and (ii) other items of

expenditure or disbursement for which a contingent bill is not required, come to hand and

are scrutinized, they, should be posted in Schedule Dockets in Form C.P.W.A 61. A

separate form being used for:-

(a) each work to be accounted for in a Schedule of Works Expenditure, Form

C.P.W.A 64 or in the Schedules of Deposit Works and Takavi Works, Forms

C.P.W.A 65 and 66.

(b) each manufacture or other item of expenditure debitable to Stock and to be

accounted for in the Schedule of Debits to Stock, Form C.P.W.A 72 (vide

paragraph 22.4.8) and

(c) each separate class of charges (including refunds of revenue) Form C.P.W.A

46A for which a schedule in any other form has to be prepared under the rules

in this Chapter.

Cash receipts which have to be taken in reduction of expenditure (vide paragraph

9.1.3) should be posted as refunds with brief particulars of the transactions. At the end of

the month, the schedule dockets should be completed in respect of Stock transactions by

posting therein all the Stock debits and credits of the month as recorded in Forms

C.P.W.A 10 and 9, Summary of Indents and the Summary of Stock Receipts,

respectively, omitting those brought to account through the Cash Book and the Transfer

Entry Books, vide Note below paragraph 7.2.29. The total of the month’s stock

transactions relating to each schedule docket should be entered therein as a single figure,

plus or minus according as it is debit or credit, and if there are both debits and credits to

be entered, the net result only should be posted. Thus in the case of schedule dockets for

works, this figure represents the total issue of materials from stock to the work and the
materials transferred from work to stock will appear as refunds under the heading

“Transfer Entries”. The schedule dockets should then be totalled and reconciled with the

works abstracts in the case of works and with the schedules concerned in the case of

dockets of class (c) above. All the vouchers (including acknowledgements for stock

supplied to contractors), transfer entry orders in Form C.A.M 34, survey reports in Form

C.P.W.A 18 and sale accounts in Form C.P.W.A 19 which are required to be submitted

to the Pay and Accounts Officer (vide paragraph 22.4.17) should then be attached to the

respective schedule dockets which should be numbered in a separate series for each

month.

Note 1:- The audit of schedule dockets is conducted in the Pay and Accounts

Office on the assumption that petty vouchers and initial stock account in support of the

certified amounts of untouched and stock charges have been duly checked by the

Divisional Accountant in detail and are available for test-audit. The Divisional

184

Accountant is therefore personally responsible for accuracy of these amounts as stated in

the Schedule Dockets.

Note 2:- Some of the schedules referred to in clause (c) above include charges for

work supported by a schedule of work expenditure in Form C.P.W.A 64. Such charges

and other transactions relating the works expenditure should be posted in the schedule

dockets for the works concerned.

22.4.3 For percentage recoveries made on account of establishment, tools and plant, and

accounts and audit charges (vide Appendix 4) a single schedule docket should be

prepared in Form C.P.W.A 62 embracing all Government, as well as, Non-Government

works on which these percentages may be leviable under rule.

Note:- This Form C.P.W.A 62 serves as the transfer entry order relating to these
recoveries (vide Note below paragraph 22.1.2) and should, therefore, be signed by the

Divisional Officer.

(c) Register of Schedules

22.4.4 (a) All cash and transfer entry transactions of the month, other than those noted

below, should be posted into-one of the schedules or registers named below, to which the

transactions relates:-

(a) Expenditure on works

(b) Expenditure on stock

(c) Transactions referred to in para 22.4.13

(i) Registers of Revenue Realized All in Form C.P.W.A 46(paragraphs

9.5.1 to9.5.2) a separate

register being main- tained for

each major head and in the

case of works for which separate

capital accounts are kept,

one for each separate system or

project

(ii) Registers of Refunds of Revenue ------As above-----

(iii) Registers of Receipts and Recoveries on ------As above-----

Capital Accounts

(iv) Register of Licence fees of Buildings Form C.P.W.A 49

and lands, (paragraph 9.5.5) a

separate register being maintained

for each major head etc as in respect

185
of Nos. (i) to (iii)

(v) Schedule of Debits to Remittances Form C.P.W.A 77

(vi) Schedules of Credits to Remittances Form C.P.W.A 77

(vii) Schedules of Debits to Miscellaneous

Head of Account Form C.P.W.A 76

(viii) Schedule of Credits to Miscellaneous

Head of Account Form C.P.W.A 76

(ix) Schedule of Transactions adjusted

under the Head “Cash Settlement

Suspense Account” (vide para 22.4.10) Form C.P.W.A 76-A

(x) Suspense Register in respect of transactions

falling under the heads“Material Purchase Form C.P.W.A 67

Settlement Suspense Account” and

“Miscellaneous Works Advances”

(vide paragraph 13.2.6 & 13.4.7)

(xi) Deposit Register, (vide para- Form C.P.W.A 67

graphs 15.5.1)

(xii) Schedule of Deposit Works, Form C.P.W.A 65

(vide Para 16.2.2)

(xiii) Schedule of Takavi Works Form C.P.W.A 66

(vide Para 16.4.2)

(xiv) Schedule of Establishment

Expenditure, vide para 22.4.4 (e) Form C.P.W.A 64-A

And 22.4.4(f)

(xv) Schedule of Works Expenditure Form C.P.W.A 64

(b) Of these registers and schedules, Nos. (i) to (iv) and (ix) to (xiv) have

already been described in the paragraph quoted against each.

Note 1:- Licence fee and other revenue receipts pertaining to (a) Military Engineer

Services, (b) Indian Air force, (c) Department of Posts and (d) Department of

Telecommunications and (e) Archeological Works of the Central Government referred to

in paragraph 22.4.6 should be posted in separate registers, Form C.P.W.A 49 .

Note 2:- A separate schedule should be prepared for each class of receipts for which

a separate register is maintained.

186

Note 3:- When under a major head of revenue, there is more than one system of

works, for which separate capital accounts are kept, a summary of the receipts of all

systems working up to the totals of the major head, should also be prepared.

(c) Schedules Nos. (v) and (vi) are the schedules in which all remittance

account transactions, are collected, the entries being grouped under the headings given in

the sample entries of Form C.P.W.A 77.

(d) Subject to such instructions as may be issued in this behalf by the Chief

Controller of Accounts, schedule Nos.(vii) and (viii) are intended to collect all

disbursements and receipts which do not pertain to any of other schedules mentioned in

this paragraph or to any of the works or stock expenditure schedules referred to in

paragraphs 22.4.6 to 22.4.8. These transactions are adjusted finally in the books of the

Pay and Accounts Officer, and ordinarily affect one of the non Public Works major heads

of revenue or expenditure (e.g. ‘0021 – Taxes on Income other than Corporations Tax’,

‘0056 – Jails’, ‘0071 – Contributions and Recoveries towards Pension and other

Retirement Benefits’, ‘2016 – Audit’, ‘2070’ – Other Administrative Services,’ ‘2075 –

Miscellaneous General Services’, ‘2235 – Social Security and Welfare’ or Funds and
Deposit Heads (e.g. ‘8009 – State Provident Fund – Other Provident Funds – Workmen’s

Contributory Provident fund; ‘8449 – Other Deposits – Subventions from Central Road

Fund’)

Note:- Income-tax deductions from work-charged establishments (excluding such

categories of work charged establishments, as are borne on the regular establishment of

Department), percentage chargeable on Imported Stores and recoveries of pensionary

charges comprised in the percentage charges levied for work done invariably appear in

the Schedule of Credits to Miscellaneous Heads of Account in Form C.P.W.A-76.

Similarly, percentage recoveries for accounts and audit appear as credits or minus debits

in the Schedules of Credits or Debits to Miscellaneous Heads of Account in Form

C.P.W.A-76 respectively, according as the amounts are creditable to ‘0070 – Other

Administrative Services – Fees for Government Audit’ or “2016 – Audit”. Expenditure

on works met from Subventions from Central Road Fund will appear in the Schedule of

Debits to Miscellaneous Heads of Account in Form C.P.W.A-76. See also paragraph

16.2.5 and 16.3.1 for expenditure on works relating to certain Local Funds. As regards

other transactions, which can not be classified under final head concerned or the heads in

the Public Account shall be shown in the Schedule of Credits or Debits to Miscellaneous

Heads of Account, in Form C.P.W.A-76, unless the Chief Controller of Accounts has

authorized this.

(e) Primary unit of appropriation-wise details of individual vouchers of

payments of pay and allowances of the officers and staff of Divisions will be shown in

Form C.P.W.A 64-A separately for Regular establishment and Work-charged

establishment borne on regular establishment to be sent alongwith the Monthly account in

triplicate. The primary units under Direction and Administration will be as under:-

(A) Executive
187

(i) Salaries

(ii) Wages

(iii) O.T.A.

(iv) Travelling Expenses

(v) Office Expenses

(vi) Payments for Professional and Social Services.

(vii) Other Charges

(viii) Total

(B) Work –charged establishment borne on regular Establishments same as under (A)

Executive

(f) Primary unit of appropriation wise debit figures will simultaneously be

shown in Form C.P.W.A. 74 under respective Sub-heads to be opened under minor head

“Direction & Administration” and credit figures in the relevant Form C.P.W.A 46 or 76.

The total of Form C.P.W.A 74 will appear in Form C.P.W.A 80.

Note:- (a) The amount of recoveries of Rent/licence fee etc. recoverable under “0059

– Public Works” or “0216 – Housing” will be shown in Form C.P.W.A. 46.

Note:- (b) The amount of recoveries on account of income tax, G.P.F. conveyance

and other advances etc will be shown in Form C.P.W.A. 76 (credits), and payment of

advances etc. will similarly be shown in Form C.P.W.A 76 (debits) duly supported by

vouchers. A covering list of supporting vouchers/schedules shall be prepared in duplicate

and attached to Form C.P.W.A. 76 (Dr/Cr) as the case may be. In other words Form

C.P.W.A 76 will be prepared separately for Debits and Credits.

Note (c):- The amounts of pay and allowances or any other advances or recoveries

which are adjustable in the books of other Accounts Officer will be shown in Form
CPWA 77, debits or credits as the case may be, in the manner indicated under (b) above.

22.4.5 At the end of month, the stock transactions of the month, as recorded in the

summary of Stock Receipts and the Summary of Indents, Form C.P.W.A 9 and 10,

excluding transactions brought to account (vide Note below paragraph 7.2.29) through

the Cash Book and the Transfer Entry Book, should be incorporated in the schedules

referred to in paragraph 22.4.4. and the schedules should be completed in all other

respects, e.g. (1) in the Debit Schedules 77, 77A, 76 and 76-A and in the Deposit Register

should be posted from the detailed schedules concerned (vide paragraphs 22.4.6 and

22.4.7) the total amount of works expenditure debitable to each head of account,

Government, department, division or office (See also paragraph 15.5.1) and (2) the total

amount of the cheques drawn during the month should be entered in the Credit Schedule,

Form C.P.W.A 77, as a single entry under the sub-heads “II – Public Works Cheques”

under the minor head “102-Public Works Remittances” below the Major Head “8782-

Cash Remittances etc.” (see also Note 3 below paragraph 22.3.1)

Note:- Expenditure on famine relief works should be entered in Debit Schedule 76.

188

All expenditure incurred directly for the relief of distresses shall be debited to

Major Head 2245 – Relief on account of natural calamities. Expenditure incurred

indirectly due to any natural calamity shall be debited to appropriate functional major

head.

Instances of functional major/minor heads corresponding to the Minor heads

under Major Head “2245” are given below:-

Minor Heads under

the Major Head

“2245”
Functional Head Major/Sub-major

Head

Minor head under

functional Major

Head/Sub-major

Head

107 – Repairs and

restoration of

damaged

Government office

Buildings

2059 Public Works 01 – Office

Buildings

053 – Maintenance

and Repairs

108 – Repairs and

restoration of

damaged

Government

Residential

Buildings

2216 – Housing 01 – Government

Residential

Buildings

106 – General Pool

accommodation

Sub-Head:

Maintenance &

Repairs

106 – Repairs and

restoration of

damaged Roads and

Bridges

3054 – Roads and

Bridges

03 – State Highways

04 – District and

Other Roads

337 - Road works

337 – Road works

282 – Public Health 2210 – Medical &

Public Health

06 – Public Health 101 Prevention and

control of diseases

109 Repairs and

Restoration of

damaged water

supply drainage and

sewerage works

2215 – Water
Supply & Sanitation

01- Water Supply

02 – Sewerage and

Sanitation

101 Urban water

supply Programmes.

102- Rural water

supply Programmes.

(Sub Head

maintenance &

Repairs)

105 – Sanitation

Services (Sub-Head

Maintenance &

Repairs)

121 Afforestation 2406 Forestry and

wild life

01-Forestry 101 – Forest

Conservation,

Development and

Regeneration

105 Veterinary Care 2403 – Animal -- 101 – Veterinary

189

Husbandry Services and

Animal Health.
22.4.6 (a):- After a reconciliation has been effected between the totals of “Works

Abstract (Form C.P.W.A 33)” and relevant schedules dockets, a Schedule of Works

Expenditure should be prepared in Form C.P.W.A 64, separately for expenditure relating

to each of the following classes:-

(i) Each Major & Sub-Major Head under which expenditure is recorded

Note: - This form is not used for Manufacture transactions vide paragraph 22.4.8

(ii) Military Engineer Service

(iii) Indian Air Force

(iv) Postal Department Works

(v) Telecommunication Department Works, entrusted to the division as a standing

arrangement.

(vi) Archeological Works connected with the conservation of ancient monuments

which are debitable to the Archeological Department.

(vii) All other Government works including occasional works of classes (ii) to (vi).

(viii All Non-Governmental Works other than Deposit Works and Takavi Works, for

which separate schedules are prepared in Form C.P.W.A 65 and 66 respectively vide

paragraph 16.2.2 and 16.4.2.

(b) Except as provided in sub-para (c) below, only those works on which expenditure

has been incurred during the month should be included in the schedule, the entries being

detailed in the order of the prescribed heads of the accounts classifications in the case of

works of classes (i) to (vi), and grouped separately for each Government, department

division, local body or other party concerned, in the case of works of classes (vii) and

(viii). All Works forming part of a single project or system should, in all cases, be

grouped together.

(c) This schedule pertaining to the accounts for September and March
(Supplementary) should include all works, including those relating to which no

transactions have appeared in the accounts of those months and a copy of it should be

sent by the Divisional Officer to the Superintending Engineer to apprise the latter of the

excess over the Estimates, Allotments etc. The schedules pertaining to the accounts for

June, September, December and March (Supplementary) should include all works

relating to National Highways and the Central Road Fund to enable the concerned Pay

190

and Accounts Officer to furnish quarterly statements of the expenditure on such works to

the Government of India.

Note 1:- In the schedules for works of classes (i) to (vi) money column 5 for “Total

charges of the Month” should be totalled so as to bring out separately the totals for (1)

each minor head,(2) each primary unit of appropriation(if any) subordinate to a minor

head, and (3) each group of works for which a separate lump sum appropriation has been

placed at the disposal of the Divisional Officer or a controlling authority. The total

progressive expenditure should be entered in column 6 and against each total should be

given (a) in Column 7, the total charges of the year which will be arrived at by adding

the total of the month to the total of the year as given in column 7 of the previous

month’s schedule, and (b) in column 8, the amount of allotment placed at the Divisional

Officer’s disposal. The excess of expenditure incurred during the year over the allotment

should be shown below the allotment. Similarly the amount of technically sanctioned

estimate and excess thereon should be entered in column 9.

Note 2: In the schedules pertaining to works of classes (vii) and (viii), the entries

relating to each work should be made separately for “works expenditure” and “percentage

charges” (for establishment, tools and plant, accounts and audit charges etc) one line

being used for each of these two charges and a third for the total charges on the work.
22.4.7 Similarly, the Schedule of Deposit Works and the schedule of Takavi Works

should be completed in respect of expenditure transactions, which should be taken from

the relevant schedule dockets.

(d) Schedule of Debits to Stock

22.4.8 All debits to Stock should be collected in Form C.P.W.A 72, Schedule of Debits

to Stock. The entries in this schedule should be arranged in three groups (1)

“Manufacture” (2) “Land, Kilns etc” and (3) “Other Sub-Heads”. Under (1), should be

debited all manufacture operations in progress and under (2) all works in progress in

connection with the acquisition of land, construction and repairs of kilns, etc. Under (3),

should be shown (a) individually, all items of expenditure on the carriage, handling etc.

of stock materials when the cost of such processes is debitable to the sub-head of stock

under which the materials are classified (vide paragraphs 7.2.27 and 10.8.1) (b)

individually, all items of acquisition of stock materials for which an estimate is required

under rule and (c) collectively, all other items of acquisition of stock materials. In

respect of each manufacture operation, the outturn of the month (vide paragraph 12.1.2)

should also be shown in the schedule, the operation and outturn being entered in two

separate lines.

Note – If the Divisional Officer is specially authorized by Government to sanction the

carriage, handling etc. charges up to a specified monetary limit, it will devolve upon the

Divisional Accountant to conduct the scrutiny of individual items of expenditure against

the Divisional Officer’s sanctions, but all items of this class should be detailed in the

schedule.

191

22.4.9 An account of the suspense head “Stock” should next be prepared in Form

C.P.W.A 73, Stock Account. Part 1 of this form is the main account showing the
receipts, issues and balances classified by sub-head, separate figures being given in

respect of the sub-heads ‘manufacture’, ‘Land Kiln’ ‘Handling and other incidental

charges’ etc, and all the other sub heads (vide para 13.3.4) being lumped up Part II of the

Detailed Account of issues, is written up first, and from this part and the Schedule of

debits to Stock, Form C.P.W.A 72, is prepared Part I.

(f) Schedule of Transactions Adjusted under the Head “Cash Settlement

Suspense Account” in the case of inter-departmental settlement with Cabinet

Secretariat and the Ministry of Defence.

22.4.10 Operation of Minor Head “107-Cash Settlement Suspense Account”

below the Major Head “8658-Suspense Accounts” for the settlement of interdivisional

transactions has been dispensed with from 1.4.1993. Instead, a new

procedure for advance payment as enumerated in the revised Appendix 7-A of

CPWA code has been introduced. Operation of this Minor Head would continue for

the clearance of old outstanding Debit balances under this head till all such

outstanding balances there under are liquidated.

With a view to minimizing the operation of Suspense heads and also to arrest

future accumulations thereunder, Minor Head “107-Cash Settlement Suspense

Account” below the Major Head “8658-Suspense Accounts” would henceforth be

operated for the settlement of inter-departmental transactions with the Cabinet

Secretariat and the Ministry of Defence. All the transactions relating to services

rendered or supplies made by the Divisions of CPWD to the Cabinet Secretariat

or/and the Ministry of Defence should be classified as Debit under Sector L –

Suspense and Miscellaneous – Sub-Sector(b) Suspense and Major and Minor Heads

thereunder :”8658 – Suspense Accounts” “107-Cash Settlement Suspense Account”.

These transactions as and when take place should be posted in Client-wise (viz.
Cabinet Secretariat or/and the Ministry of Defence) Register of transactions

adjusted under the head “107 – Cash Settlement Suspense Account” in Form 1 of

Appendix 7-C (b) of C.P.W.A. Code on closing the Monthly Account” of the

Division. A copy of Part I of Form 1 should be sent to the Client

Department/Ministry concerned duly supported by all the relevant vouchers and

receipt of the cheque/draft should be watched through the Register referred to

above. The Cheque/Bank Draft when received, should be entered on the Receipt

side of the Cash Book, the entry being classified as credit to the minor head “107 –

Cash Settlement Suspense Account” below the Major Head “8658 – Suspense

Accounts”’ thus clearing the original debit under this head and the cheque should

be sent to the Bank for encashment or for making necessary adjustment of the

cheque by Debiting Sub-head “Remittances into Bank” under the Minor head “102-

PublicWorks Remittances” below the Major Head “8782- Cash Remittances etc.”.

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On realization of the proceeds of cheque through Receipt Scroll received from Focal

Point Bank, PAO of the Division will clear Debit head “Remittances into Bank”

under the Minor Head “102-Public Works Remittances” below the Major Head

“8782 - Cash Remittances etc.” by minus debit per contra debit to minor head “108-

Public Sector Bank Suspense” below the Major Head “8658-Suspense Accounts.

However, Divisional Officer on receipt of the Copy of Receipt Scroll from the

Dealing Branch, will enter the same in Part-I of Form C.P.W.A 51 to be sent alongwith

Monthly Account to the PAO of the Division.

Remittance of cheque/Bank Draft in settlement of inter-departmental

transactions with Cabinet Sectt./Ministry of Defence should be intimated by the

client Department in Form 2 of Appendix 7-C(b)

Note: All items of claims relating to cash transactions should be detailed individually in

Form C.P.W.A 76-A.

(g) Classified Abstract of Expenditure

22.4.11 A consolidated account of all expenditure debited against the grants of the

division should be prepared in Form C.P.W.A 74, Classified Abstract of Expenditure.

The figures relating to the several major and sub-major heads should be entered in

separate sections, arranged in the order indicated in the List of Major and Minor Heads of

Accounts.

Note 1 – When Works for any of the Departments named below are undertaken as a

standing Military Engineer Service arrangement, vide paragraph 22.4.6(a), and funds for

the purpose are allotted to the division, the expenditure connected therewith should also

be abstracted in Form C.P.W.A 74 the classification of expenditure being that prescribed

in respect of the works concerned vide Note 3 below paragraph 3.1.7.

(i) Indian Air Force

(ii) Posts

(iii) Telecommunications

(iv) Archaeological Department

Note 2 – Refunds of Revenue are excluded for this Abstract, as they are treated as minus

Revenue, vide paragraphs 9.4.1. “Receipts and Recoveries on Capital Account” are

included in the Abstract as minus expenditure, as they are taken in reduction of the

charges under the major head concerned vide Statement E of Appendix 2.

(h) Monthly Account

22.4.12 The Monthly Account should be prepared in the Form C.P.W.A 80 (with

all supporting registers, schedules, vouchers, etc.) for presentation to the Divisional

officer and submission to the Pay and Accounts Officer. This account is an abstract of
193

the entrie receipts and disbursements of the month as worked out in the Abstract Book

(Form C.P.W.A 81) and as detailed in the various schedules and registers, and shows

also in the opening and closing cash balances. On the back of the form are printed (1) a

memorandum of miscellaneous cash receipts paid into Banks, and (2) a certificate in

respect of the closing cash balances of subordinate disbursing officers. The entries in the

Accounts are divided into three groups – (1) Revenue Entries, which are totals of receipts

of Government under the several major heads, as taken from the Registers of Revenue

Realised, Form C.P.W.A 46. (2) Expenditure Entries which are the totals of expenditure

of Government for the several divisions of major heads and are posted from the

Classified Abstract of Expenditure, Form C.P.W.A 74 and (3) Other Heads, entries in

which representing both receipts and disbursements are posted from the Schedules of

Deposits, Takavi Works, Miscellaneous Heads of Account, and transactions adjusted

under the head “107-Cash Settlement Suspense Account,” Forms C.P.W.A 79, 66 and

76-A respectively.

Note 1 – The entries posted under the several heads in the Monthly Account should be

checked with corresponding entries in the Abstract Book (Form C.P.W.A 81).

Note 2 – The totals of the columns for receipts and disbursements must agree, and if there

is any difference due to cash being in transit between two disbursing officers, its amount

etc., should be included in the closing balance and the certificate of cash balance should

be amplified so as to state the amount and the steps taken to adjust the difference.

22.4.13 (a) There are certain transactions recorded in the initial cash and stock

accounts, which involve no operation on a revenue, expenditure, or any other prescribed

heads of the accounts classification, as every such entry is counterbalanced either at once

or after an interval, by a similar entry of the reverse character. It is not necessary to

include transactions, for audit purpose, in any of the schedules and registers subsidiary to

the Monthly Account, but the Divisional Accountant should see that all transactions are

cancelled by each other in due course.

(b) The transactions fall under the following two classes.

(i) Cash from Bank – A cheque drawn to replenish the cash chest is debited to

this head in the Cash Book, and per contra the amount of the cheque is entered

at once, as cash received, under the same head, a cheque drawn by designation

being cash (vide paragraph 6.1.1), even though not cashed at once.

(ii) Transfers within division – adjusted on the basis of Advance Payment by

operating Stock/Works Advance etc.. The procedure of which is laid down in

Appendix 7-A of this Code.

22.4.14 Save as provided in paragraph 22.4.13, all transactions of the division, as

recorded in the initial accounts of cash and stock and in the transfer entry book, enter one

or other of the prescribed schedules, the details being in some cases recorded in

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supporting schedule dockets. Transactions recorded in the cash book and the transfer

entry book are posted direct from those sources, no items being omitted, but those

recorded in the initial accounts of stock, Forms C.P.W.A 8, 9 and 10 are dealt with as

under:-

(a) those brought to account through the Cash Book or the Transfer Entry

Book (vide paragraph 7.2.29) e.g., stock purchase in cash, stock sold

for cash, and stock received from works, are left out, and

(b) the rest are posted direct from the Summary of Stock Receipts and the

Summary of Indents, Forms C.P.W.A 9 and 10.

To ensure the accurate compilation of accounts, it is essential that the transactions

referred to in (a) above are not brought to account twice, and the Divisional Accountant

should see that all items of this class are correctly separated off in the Summary of Stock,

Receipts and the Summary of Indents, Form C.P.W.A 9 and 10 as prescribed in Note

below paragraph 7.2.29.

(i) Submission to Pay and Accounts Officer

22.4.15 The Monthly Account in Form C.P.W.A 80 is due to reach the Accounts

Office by such date of the month following that to which it relates, as may be fixed by the

Chief Controller of Accouns. It should be supported by the following documents:-

Revenue Realised (see also Para 22.4.4(f) and the note thereunder

1. Schedule of Refunds of Revenue

Receipts and Recoveries on Capital Accounts, in Form C.P.W.A 46-A.

2. Classified Abstracts of Expenditure, Form C.P.W.A 74 [see also para

22.4.4(f)]

3. Schedules of Works Expenditure, Form C.P.W.A 64 [see also paragraph

22.4.6 (c)]

4. Schedule of Establishment Expenditure, Form C.P.W.A 64-A [see also

paragraph 22.4.4 (f)]

5. Consolidated Contingent Bill (With necessary vouchers) Form G.A.R. 31

6. Schedule Dockets, Form C.P.W.A 61 with necessary vouchers, transfer entry

order, survey reports and sale accounts attached to each (See also Note 1

below paragraph 22.4.2) .

7. Schedule Docket of percentage recoveries Form C.P.W.A 62.

195

8. Stock Account, Form C.P.W.A 73 (With Sale Accounts, Form C.P.W.A 19, in

support of the Cash Credit to Stock).

9. Schedule of Debits to Stock Form C.P.W.A 72 | Extracted

rom the

| relevant sections of

10. Abstract Account of Credits, Debit and | the Suspense Register

Balances of the Purchases, Accounts, Form C.P.W.A 69 |Form C.P.W.A 67

see also paragraph 22.4.4(f) and note |

thereunder |

11. Schedule of Miscellaneous Works

Advances, Form C.P.W.A 70

12. Schedule of Workshop Suspense (Local Form)

13. Schedules of Credits and Debits to Miscellaneous Heads of Account. Form

C.P.W.A 76 (See also paragraph 22.4.4 (f) and note thereunder.

14. Schedule of Transactions adjusted under the head “Cash Settlement Suspense

Account”, Form C.P.W.A 76-A.

15. Schedule of Transaction Adjusted under the head “MPSSA” in Form

C.P.W.A 69.

16. Schedules of Credits and Debits to Remittances, Form C.P.W.A 77 (See also

paragraph 22.4.4(f) and Note thereunder)

17. Schedule of Monthly Reconciliation of Cheques and Remittances, Form

C.P.W.A 51.

18. Schedules of Deposits, Form C.P.W.A 79 (Abstract of Form C.P.W.A 67 of

Deposit Register)

19. Schedule of Deposit Works, Form C.P.W.A 65 (with Report of Progress of

Expenditure)

20. Schedule of Takavi Works, Form C.P.W.A 66, with accepted certificates of
Collector referred to in paragraph 16.4.5.

21. Copies of Tools and Plant Received Sheets and Tools and Plant Indents,

Form C.P.W.A 13 and 14 (only in respect of Special Tools and Plant) Form

C.P.W.A 14 should be accompanied by the supporting survey report of stores,

Form C.P.W.A 18, Sale Accounts, Form C.P.W.A 19 and acknowledgements

of Officers concerned in the case of articles transferred to other P.W.D.

Divisions, including the Divisions of other Governments.

22. Abstract Book Form CPWA-81

196

23. Statement showing the expenditure on Deposit Work, FormCPWA-65-A

24. List of Accounts submitted to Pay & Accounts Officer, Form C.P.W.A 83.

Note 1 – If the Divisional Officer is required by any rule to make a formal report

periodically, of the progress of expenditure on a Deposit Work to the administrator or

depositor concerned, the report in Form C.P.W.A 65-A setting forth the amount of the

estimate, the total deposits received and the progressive expenditure, should

accompany the Schedule of Deposit Works, so that Pay and Accounts Officer may,

after auditing the schedule, verify the report and forward it to the local body or person

concerned.

Note 2 – If the Divisional Officer is authorized to refund, without reference to higher

authority, fines which have been remitted by a court of law, the original orders of the

court should accompany the Schedule of Refunds of Revenue.

22.4.16 The Schedules relating to the suspense and deposit accounts, Form

C.P.W.A 70, 73 and 79 and the Workshop Suspense Schedule, must be submitted to

the Pay and Accounts Officer, month after month, so long as there are balances

outstanding under the accounts concerned, whether there have been transactions
during the month or not. The Schedule of Miscellaneous Public Works Advances

Form C.P.W.A 70 and the Schedule of Deposits, Form C.P.W.A 79 should however

be restricted to the items affected during the month. In respect of the Schedule of

Deposit Works, Form C.P.W.A 65 the Divisional Officer may, if so authorized by the

Accounts Officer, dispense with the submission every month, of Part II of the

Schedule, provided (1) that this Part is invariably submitted with the accounts for

March, and (2) that, if Part II for any month contains works, any expenditure thereon

has been charged to Miscellaneous P.W. Advances, and extract from Part II relating

to such works only is submitted to the Pay and Accounts Officer. Similarly, in the

Schedule of Miscellaneous Works Advances, Form C.P.W.A 70, for the month other

than March, items which do not exceed Rs.5 each may be shown in a lump sum, if so

authorized by the Chief Controller of Accounts. Subject to these exceptions, the

remaining schedules are necessary only if there have been any transactions during the

month.

Note 1 The Abstract Account of Credits, Debits and Balances of the Material

Purchase Settlement Suspense Account, Form C.P.W.A 69 and the Schedule of

Miscellaneous Works Advances, Form C.P.W.A 70 for September and March should

be accompanied by a list of items outstanding under the Suspense Heads for more

than six months.

Note 2 - The Schedule of transactions adjusted under the Head “107-Cash

Settlement Suspense Account”, Form C.P.W.A 76-A for September and March

should be accompanied by a statement in Form C.P.W.A 76-B showing the

outstandings which are unsettled for more than six months.

197

22.4.17(a) With the exceptions noted below (as to which, however, see clause (b)
below), all vouchers and transfer entry orders in support of cash payment and other

charges in the accounts must accompany the Monthly Account:-

(i) Muster rolls or other vouchers in support of payments to laborers irrespective

of the amount

(ii) Vouchers in support of payments of wages to members of the work-charged

establishment (other than those borne on regular Estt.) corresponding to

class IV staff, in regular establishment.

(iii) Other cash vouchers, relating to works (other than running/final account bills

of Contractors/Suppliers) and contingencies, the amount of which do not

exceeds Rs.1000/-.

(iv) Invoices or other vouchers in acknowledgement of issues of stock materials,

including issues of outturn from Manufacture to Stock.

(v) Vouchers in support of payments made for the conversion of cash deposits

into interest-bearing securities in cases in which no vouchers other than the

security itself or a safe custody certificate of the security exists.

Note – When a voucher of this class is not submitted to the Pay and Accounts Officer,

the reasons should be noted against the entry of its amount in the Schedule docket or

in the Schedule of works expenditure, see Note 1 below paragraph 22.4.2.

(vi) Transfer entry orders of the classes enumerated below:-

Those involving debits to remittance heads other than in respect of expenditure on

works. Those relating to charges which are supported by vouchers received in

transfer.

Those involving credit to Revenue Head (Gross Receipts) or to any Miscellaneous

Head of Account otherwise than in respect of expenditure on works.

(b) All vouchers (other than Muster Rolls) in support of debits to contractors should
be submitted to the Accounts Officer even though falling under any of the exceptions

to clause (a).

(c) The Land Award Statements, the vouchers and the accounts etc., received from

the Land Acquisition Officers in respect of land acquired together with the Transfer

Entry order approved by the Divisional Officer should after relevant entries thereof in

the Register of Land charges be submitted to the Accounts Officer.

(d) All Survey Reports of Stores (Form C.P.W.A 18) and Sale Accounts (Form

C.P.W.A 19) must also accompany the Monthly Account. Sale Accounts in support

of cash credits to Stock should be attached to the Stock Account, Form C.P.W.A 73,

Survey Reports and Sale Accounts in support of other credits to Stock should be

attached to the schedule dockets pertaining to the works or accounts debited, those in

198

support of the Tools and Plant indents Form C.P.W.A 14, vide paragraph 22.4.15(20),

should accompany that document, and the remaining Survey Reports and sale

accounts should be attached to the schedule dockets relating to the works or accounts

credited.

22.4.18 The Divisional Accountant is required to sign not only the Monthly Account

but also all the schedules etc., accompanying it. It is not necessary that the Divisional

Officer should sign all these documents; he must, however, sign the Monthly Account

and the List of Accounts Form C.P.W.A 83, unless he is absent from headquarters, in

which case he should send to the Pay and Accounts Officer, as soon as he can

examine his books and papers on return, a report in Form C.P.W.A 84 (with a

duplicate copy of the Monthly Account signed by himself), without which the Pay

and Accounts Officer will not pass the Monthly Account finally. The Contingent Bill

must invariably be signed by the Divisional Officer.

Note – It is desirable that the Divisional Officer should make arrangements for the

review by himself of all vouchers before they are submitted to the Pay and Accounts

Officer and that unless the circumstances are exceptional, he should sign the accounts

himself.

22.4.19 In connection with the accounts for March, the following points should

receive special attention:-

(a) The entry of the closing cash balance should be supported by (1) the original cash

Balance Reports (Form C.P.W.A 5) of all Disbursing Officers including the

Divisional Officer and (2) a certificate of the Divisional Officer to the effect that he

has obtained on or after 31st March and retained in his office an acknowledgement

from the officer or subordinate concerned, in respect of each item of imprest or

temporary advance shown in the Cash Balance Reports of the Division for 31st

March.

Note The Original Cash Balance Reports of sub-ordinate disbursing officers should

be initialed by the Divisional Officer before transmission to the Accounts Officer.

(b) To Part II of the Schedule of Reconciliation of Cheques and Remittances, Form

C.P.W.A 51, should be subjoined, a statement, in the form given below, in respect of

the cheques drawn to meet payments of works.

Particulars No. of Cheques issued Amount

For the whole month ……………….

During the last five working days of the month

(c) The Schedule of Deposits, Form C.P.W.A 79 should be accompanied by the Account

of Interest-bearing Securities, Form C.P.W.A 86, referred to in Paragraph 15.6.1

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II. Review of Unsettled Accounts

22.4.20 The several registers and schedules relating to the suspense and deposit heads

of account and the accounts referred to below should be reviewed monthly so that the

steps necessary to effect the expeditious clearance of outstanding balances, whether by

actual recovery or by adjustment in the accounts, may be taken regularly throughout the

year. In February or early March, special steps should be taken with a view to bring

about all possible reductions in the number and amounts of outstanding items at the close

of the year; and within six weeks of the submission of the Monthly Account for March, a

consolidated certificate in respect of the balances, other than cash, should be forwarded to

the Accounts Officer in Form C.P.W.A 91, Annual Certificates of Balances.

(i)Contractors ledger (ii) Works Abstract (iii) Schedule dockets (iv) Register of Works,

(v)Licence fees Registers and other records of assessment and realization of revenue

referred to in Paragraph 9.1.4.

Note – If the closing balance under any head is nil, it does not necessarily follow that a

certificate is not required in respect of it. In all cases in which there was a balance at the

commencement of the year, or there were any transactions during the year, a certificate

should be recorded, the wording of it being suitably amended (if necessary) in case the

closing balance is nil.

22.4.21 Similarly, the prompt settlement of all remittance transactions, original or

responding, should receive the personal attention of the Divisional Accountant (vide

paragraph 5.5.3), who should take special steps early in March to bring to account all

liabilities and assets awaiting settlement, and to effect clearance, in the accounts of

March of as many outstanding items as possible. Liabilities, as well as, outstanding

debits and credits remaining unadjusted at the end of March should be watched

individually with a view to their clearance before the accounts of the year are closed

finally. It is not sufficient that the Divisional Office has brought to account all the
transactions the responsibility for which devolved on itself. It is equally important that

necessary action be taken to move the other parties concerned to bring to account or settle

the outstanding items, the intervention of the Accounts Officer being sought, where

necessary.

III. Closing the Accounts of the year

22.4.22 The financial year terminates on 31st March, and actual transactions taking

place after that date can on no account be treated as pertaining to the year. It is,

necessary, however, that as many of the unadjusted outstandings of the year as possible,

should be cleared within the accounts of the year, and the errors in accounts coming to

notice after 31st March should be set right, if possible, without affecting the accounts and

estimates of the following year. Whilst, therefore, it is necessary that the cash accounts

should be positively closed on the 31st March and also the Stock Accounts in respect of

actual transactions, the Transfer Entry Book and the stock accounts should be kept open

200

for transfer entries relating to rectification of errors and settlement of outstandings.

These accounts should be closed on the 20th May or on such other date, as may be

prescribed by the Chief Controller of Accounts.

Note – If any adjustments in accounts have been purposely deferred till the close of the

accounts of the year, it is permissible to effect them after 31st March in the same way as

adjustments in rectification of errors notified after that date.

22.4.23 The transfer entry transactions referred to in paragraph 22.4.22 should be

consolidated into a special Monthly Account, which, with all the necessary

accompaniments, should be submitted to the Accounts Officer on or before 1st June or

any other date that may be prescribed by him. This account is known as the

Supplementary Account of the year.

Note – This account should be of the simplest character and should set forth only the

transactions to be brought to account. It is not necessary, for instance, to repeat in any of

the Suspense or Deposit Schedules, the items not affected, so long as, in addition to the

necessary details of the items affected, the totals for the accounts concerned are also

given.

IV. Miscellaneous Returns

22.4.24 Other account returns which the Divisional Officer should submit to the

Accounts Officer are the following:-

(a) Monthly:-

Certificate regarding the completion of the Register of Licence Fee Register and revision

of Licence Fees in Form C.P.W.A 75-B.

(b) Half yearly:-

(i) Lists of items outstanding for more than six months under the suspense heads

‘Material Purchase Settlement Suspense Account’ and ‘Miscellaneous Works Advances’

alongwith the Monthly Accounts for September and March (to be attached to Form

C.P.W.As 69 and 70)

(ii) Statement in Form C.P.W.A 76-B showing the outstanding which are unsettled

for more than 4 months under “Cash Settlement Suspense Accounts” alongwith the

monthly accounts for September and March (to be attached to Form C.P.W.A 76-A)

V. Corrections in Accounts

22.4.25 (a) If an item in the accounts which properly belongs to a revenue or

expenditure head is classified wrongly under another revenue or expenditure head, the

error may be corrected at any time before the accounts of the year are closed, but after the

accounts are closed, no correction is admissible except as permitted in Para 8.1.2 to 8.1.4

of this Code and in cases affecting the account, of works including those falling under
paragraph 10.6.12 of this Code.

201

Note 1 – Errors in suspense accounts are governed by the rule in clause(b).

Note 2 - If an error be detected after submission to the Pay and Accounts Officer of the

Divisional Officer’s Supplementary Account of the year, it should nevertheless be

reported to the Chief Controller of Accounts for instructions unless the amount be not

more than ten rupees.

(b) All errors affecting debt (including suspense) and remittance heads must be

corrected, however old they may be.

(c) When a correction is permissible, it should be made by a formal transfer entry, but

when it is not permitted, it is sufficient to make a suitable note of it in the account

concerned or to make the necessary alterations in the Progressive figures, as may be

necessary.

22.4.26 All corrections in accounts which may be advised by the Pay and Accounts

Officer on auditing the documents, should, after verification, be carried out in all relevant

records, the entries being made in red ink (quoting the audit note or other advice) and

attested by the dated initials of the Divisional Accountant.

Note – The Divisional Accountant is responsible that all corrections advised by the Pay

and Accounts Officer are specially brought to the notice of the Divisional Officer.

VI. Proforma Accounts

22.4.27 When the details of any cl.ass of transactions, as recorded in the prescribed

accounts, are not sufficiently indicative of the financial results of the operations of a

given period and it is necessary to ascertain the results, it is usual to prepare periodically

suitable proforma accounts in addition.

Note 1 – If the maintenance of such supplementary accounts is necessary for audit

purposes, and no form has been prescribed by the Comptroller & Auditor General of

India, the Chief Controller of Accounts will determine the required forms in consultation

with Controller General of Accounts, but if the accounts are required for administrative

purposes, the accounts will be maintained in such form as may be agreed upon between

the Chief Controller of Accounts and Government.

Note 2 – If the proforma account relates to transactions of two or more divisions the

compilation of it is undertaken by the Pay and Accounts Officer, and Divisional Officers

may be required to furnish the necessary data. A pro-forma account relating to a single

division will be prepared by the Divisional Officer and if it is an account prescribed by an

administrative authority, the Pay and Accounts Officer may not be required to check it

except in pursuance of an arrangement agreed upon between him and Government.

202

22.4.28 If for the purposes of any pro-forms account which the Pay and Accounts

Officer is required to prepare or check, it is necessary to determine the charges incurred

on a particular work or service, or a group of works or services, the expenditure thereon

should be booked separately in the general accounts, even though, under rule, it may not

be customary to estimate or account for such expenditure separately. Detailed

instructions in this connection will be issued by the Chief Controller of Accounts in

consultation with Government, where necessary. See also paragraph 3.2.1 (d)

22.4.29 The proforma accounts showing the results of the working of irrigation,

etc, projects, productive as well as unproductive for which capital accounts are kept, are

prepared annually by the Pay and Accounts Officer in accordance with the rules

prescribed in the Government Accounting Rules,1990. These accounts are known as the

Administrative Accounts of Irrigation, Navigation, Embankment and Drainage Works.

Note – For rules relating to pro forma accounts of irrigation water courses, see paragraph
5 of Appendix 3

22.4.30 For workshops, manufactures and similar quasi-commercial undertakings,

it is usual to prepare pro forma accounts periodically, vide paragraphs 12.2.2(d) and

14.3.1.

VII. Review by Divisional Officer

22.4.31 The Divisional Officer should review from time to time the several

registers, books and accounts, as are maintained in the divisional and sub-divisional

offices even though under the rules in this Code he may have scrutinized and intialled the

individual entries or sets of entries therein. To this end he may require these records to

be laid before him through the Divisional Accountant, monthly or at such other intervals

as may be fixed by him. The Fact of such review should be placed on recording all cases

preferably in Form C.P.W.A 96 (Memo of Review) posted in a suitable position on the

account etc. concerned.

203

CHAPTER 23

BANKING ARRANGEMENTS

23.1 INTRODUCTION

23.1.1 Under the provisions of Section 21 of the Reserve Bank of India Act, 1934 and

the agreement entered into by the Central Government with Reserve Bank of India,

general banking business consisting of receipts, collections, payments and remittances on

behalf of Central Government is carried on by Reserve Bank of India as their Banker.

In the earlier stages when the scheme of separation of Accounts from Audit was

introduced on experimental basis in the year 1955 in respect of the Ministries of

Agriculture, Food, Supply, Rehabilitation and the then Works and Housing (now the

Ministry of Urban Development) under the charge of the then Chief Pay and Accounts
Officer, the Receipts and Payments of the above mentioned Ministries were handled by

the Reserve Bank of India. At places where the branches of Reserve Bank of India did

not exist, the Banking business of these Ministries was handled by the State Bank of

India as an Agent of Reserve Bank of India.

In other words Reserve Bank of India, Central Accounts Section, Nagpur

maintains General Ledger of the Union Government’s Cash balances. In addition it also

maintains Proforma Accounts for Union Government Civil Ministries/Departments and

also the Proforma Accounts of Non-Civil Ministries/Departments like Railways,

Defence, Posts and Telecommunications on year to year basis. These Proforma

Balances at the end of the Financial year are merged under Union Government Civil

Balances.

23.1.2 As a sequel to the departmentalization of Accounts in the year 1976 in three

phases, Reserve Bank of India in consultation with the Ministry of Finance authorized all

the Nationlised Public Sector Banks to handle Government business of the Central Civil

Ministries as their agents on turn over commission basis to cope up with the heavy rush

of transactions of Government business. The then Ministry of Works and Housing

(presently the Ministry of Urban Development and Poverty Alleviation) was allowed to

continue its Government banking business with the Reserve Bank of India and the State

Bank of India in places where the branches of Reserve Bank of India did not exist. This

system remained in vogue till 31st March 2005.

23.2 CHANGE IN THE BANKING ARRANGEMENTS

23.2.1 Consequent upon the decision taken by the Reserve Bank of India to delink itself

from the retail banking business of some of the Central Ministires/Departments including

that of the Ministry of Urban Development and Poverty Alleviation and also authorizing

three Private Sector Banks viz., ICICI Bank Ltd, UTI Bank Ltd and HDFC Bank Ltd to
204

handle Central Government business on their behalf as their agents on the same terms and

conditions as applicable to the Public Sector Bank (except that these banks have been

allowed permissible period of 3 days,including holidays, for remitting government money

into Government Account with RBI,CAS). The following banking arrangements have

been made for various Departments of the Ministry of Urban Affairs & Poverty

Alleviation and Ministry of Urban Development w.e.f. 1.4.2005:-

(i) State Bank of India throughout the country will be the accredited Bank of

Central Public Works Department (CPWD) w.e.f 01-04-2005.

(ii) UTI Bank Ltd will be the accredited Bank for handling Government

transactions of the Secretariat, Directorate of Estates, Other attached and

Subordinate offices including Land and Development Office (L&DO)w.e.f

01-02-2005.

(iii) IDBI Bank Ltd will be the accredited Bank for various offices of the

Departments of Printing, Stationery and Publications under the Directorate of

Printing and Stationery w.e.f 01-02-2005.

23.2.2 The above mentioned Banking arrangements have been necessitated as a sequel to

the decision taken by the Reserve Bank of India to gradually move away from the retail

banking business of the Central Government Ministries/Departments which have been

handling their Government transactions with the Reserve Bank of India as their

accredited Bank.

23.3DRAWING ACCOUNT AND ASSIGNMENT ACCOUNT (LETTER OF

CREDIT)

23.3.1 Pay and Accounts Officers of the Divisions of CPWD have drawing account in

their accredited Bank meaning thereby that the PAO of the Division can draw any
amount subject to the annual ceiling of Budgetary allocation in the Consolidated Fund of

India and the availability of Funds/Deposits etc. in the Public Account of India on the

basis of Expenditure Sanction issued by the competent authority.

23.3.2 Divisional officers of the CPWD have been vested with cheque drawing powers

to draw funds from the local branches of the State Bank of India accredited to their

Divisions against the Letter of Credit assigned to them for arranging payment of salary

and allowances of the officers and the staff including work charged staff and other

expenses as enunciated in para 3.1.1 of “Civil Accounts Manual” besides execution of

works and purchases connected with the activities of CPWD. They shall however not be

allowed to make payments of Long Term Advances like House Building

Advance/Motorcar Advances etc. to their employees. All long term advances, Pensions

and other Retirement benefits and Final Payments of Provident Funds like General

Provident Funds to Group “A”, “B” and “C” officers will be payable by the Pay and

Accounts Officers of their Divisions.

23.3.3 Since the functioning of the Cheque Drawing and Disbursing Officers of the

Divisions of CPWD is quite different from that of other Cheque Drawing and Disbursing

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Officers, special arrangements for the issue of Letter of Credit as stipulated in para

6.2.1(b) of CPWA Code deviating from the Quarterly assignment of Funds have been

made by the competent authority, which are to be followed scrupulously by all

concerned.

23.3.4 The letters of credit indicating Major Headwise allocation of funds as printed on

the cheque leaf shall be issued by the Accounts Officer of L.O.C. Cell of the Principal

Accounts Office at Head Quarters, authorizing the paying branch of the Bank to make

payment on the cheques drawn from time to time by the concerned Cheque Drawing and
Disbursing Officers with clear instructions not to exceed the limit of headwise allocation

authorized by the AO, LOC(Cell) in any case. While communicating the assignment for

the second and subsequent Letters of Credit (LOC), AO of the LOC(Cell) will indicate

not only the assignment for the subsequent LOC but also the progressive total of the

assignment upto the end of subsequent LOC. Unspent balance for the last LOC shall not

be carried forward to next Financial Year but the cheques encashed in the subsequent

year in settlement of claims pertaining to the last LOC shall be adjusted and accounted

for against the assignment of the last LOC of previous Financial year.

23.3.5 Accounts Officer of the LOC Cell shall ensure that the letter of credit authorizing

Major Head wise allocation is correctly addressed to the Divisional Officers and the

accredited Bank branches are also intimated regarding the ceiling of amount assigned to

them. Copy of the LOC should also be endorsed to the Pay and Accounts Officer of the

Division concerned. Arrangements have been made for the communication of Letter of

Credit to the accredited bank branches of the Divisions through the Centralised Branch of

the State Bank of India, Nirman Bhawan, New Delhi so that mandate reaches the

branches immediately. With a view to reducing the time taken in dispatch/postal process,

mandate is to be communicated electronically after proper authentication by the

Centralised branch of the State Bank of India, Nirman Bhawan, New Delhi.

23.3.6 Divisional Officers must ensure that no funds are diverted from one head to

another head in any case. Any deviation of Funds will be the personal responsibility of

the Divisional officer concerned.

23.3.7 Similarly accredited branches of the Bank must ensure that the headwise

assignment of amount intimated through the Letter of Credit does not exceed in any case.

23.4 REVISED PROCEDURE

23.4.1 Consequent upon the switch over from the Reserve Bank of India to the State
Bank of India with effect from 1st April 2005, all the receipts and payment transactions

pertaining to the Divisions including that of the Pay and Accounts Officer of the Division

will now henceforth be handled by the accredited branches of the State Bank of India

throughout the country. The Dealing branches will report day-to-day Receipts and

Payments transactions of the Divisions including the transactions of their Pay and

Accounts Offices to their designated Focal Point Branches who in turn will transmit the

same duly verified by the respective Pay and Accounts Officers to the State Bank of

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India’s Government Accounts Department (GAD), Mumbai for final settlement of

reimbursement from the Reserve Bank of India, Central Accounts Office, Nagpur.

23.4.2 The role of Dealing branches, Focal Point branches, Government Accounts

Department of State Bank of India, Mumbai, Reserve Bank of India, Central

Accounts Office, Nagpur, Pay and Accounts officers of the Division, Divisional

Officers of the CPWD and the action in the Principal Accounts Officer, Ministry

of Urban Development and Poverty Alleviation has been explained step by step in

the following paras.

23.4.3 Under the revised banking arrangements, Focal point bankState Bank of India will

be responsible for reconciliation of figures with Pay and Accounts

Officers/Divisional Officers.

23.5 ROLE OF DEALING BRANCHES OF THE STATE BANK OF INDIA

23.5.1 As a sequel to the decision taken by the Reserve Bank of India to move away

from the retail banking business of the Ministry of Urban Development and Ministry of

Urban Employment & Poverty Alleviation with effect from 1.4.2005, State Bank of India

all over the country has been nominated as the accredited Bank of the Central Public

Works Department.
23.5.2 According to the revised procedure of reporting, accounting and reconciliation

introduced from 1st April 2005, all the receipts and payments transactions of CPWD will

hence forth be handled by the Dealing Branches of the State Bank of India throughout the

country. The dealing branch of each Central Public Works Division including its Pay and

Accounts Office will report day-to-day transactions of CPWD to Focal Point Branch of

the State Bank of India by preparing daily sub-head wise Payment and Receipt Scrolls in

Quadruplicate separately for each Account holder viz the Divisional Office and the PAO.

Each day’s scroll will be given a running serial number for the accounting year from 1st

April to 31st March, separate serial numbers being given to scrolls of each account.

These serial numbers on the scrolls will bear prefix “DMA(E) for Payment and DMA(R )

for Receipts”. DMA means Daily Memorandum of Advice. The Serial number of the

entry in the scroll will be recorded on the corresponding cheques/challans for purpose of

identification. After the books of the branch have been balanced with reference to the

total of day’s scrolls, two copies of the scrolls alongwith the relative challans/paid

cheques will be sent by them to the designated “Focal Point Branch” and not to the PAO

with a Forwarding Memo (Annexure 5 as contemplated in Civil Accounts Manual i.e.,

GAD 5 of State Bank of India) on a day-to-day basis. One copy of the scroll will be sent

directly by them to the concerned DDO. The fourth copy of the scroll will be retained by

the Branch for its own record.

23.6 ROLE OF FOCAL POINT BRANCH OF THE STATE BANK OF INDIA

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23.6.1 The Focal Point Branch, in addition to acting as a dealing Branch, will be

responsible for prompt and accurate accounting of the transactions reported to it daily by

all the dealing branches linked to it.

23.6.2 (a) Preparation and submission of Main Scroll together with related challans/paid
cheques to Pay and Accounts Officer.

On receipt of two copies of the scrolls together with relative documents viz the

Receipted Challans/Paid Cheques attached to original scroll from the Dealing Branch, the

Focal Point Branch will separate the original and duplicate copies of the scrolls and

subject them to careful scrutiny for accuracy. Focal Point Branch will consolidate the

transactions of the various dealing branches including its own and prepare a “Main

Scroll” in triplicate (Annexure 6) separately for each Account holder, giving the totals of

all accounts separately for which scrolls have been received from each branch. Two

copies of the Main Scroll along with the original copy of the scroll with the relative

instruments received from various dealing branches will be forwarded to the concerned

Pay and Accounts Officer on a day-to-day basis. The duplicate copy of the scrolls

without any instrument received from the dealing branches will be stitched and retained

by the Focal Point Branch for its record. Simultaneously the aggregate of the receipts

and payments arrived at in the Main Scroll will be incorporated in a Daily Memo

(Annexure 7) and the same will be reported to its Link Cell i.e., Government Account

Department (GAD) at Mumbai for settlement of funds with Reserve Bank of India,

Central Accounts Section, Nagpur on a day-to-day basis. The report will be sent through

the fastest mode of communication if the net amount is Rupees one Lakh and above. A

“Nil” advice should also be sent where there are no transactions to report. The Main

Scroll submitted to PAO as well as the Memo/Nil advice to Link Cell should bear a serial

number in consecutive order for the year from 1st April to 31st March.

The PAO, on receipt of copies of Main Scroll and supporting documents will certify and

return the duplicate copy of the scroll within 24 hours to the “Focal Point” branch after

verification. The “Focal Point” branch should keep a watch on the prompt receipt of the

certified copy of the scroll from the PAO. The “Focal Point” branch should ensure that:
(i) the mistakes/discrepancies pointed out by PAO are rectified after proper

verification through “Error Scroll” in GAD 13 – Error-Adjustment

Schedule where necessary, as per the procedure.

(ii) Missing challans/Paid Cheques are submitted to PAO directly

(iii) The copies of the Main Scrolls duly verified by the PAO are kept on its

record.

Focal Point Branches are also required to furnish a certificate to the effect that necessary

scrolls/paid cheques/challans etc have already been submitted to the concerned Pay and

Accounts Office.

23.6.3 Since the Challans/Paid Cheques are important documents evidencing payments

into/withdrawals from Government Accounts, utmost care has to be exercised by the

Dealing Branch/Focal Point Branch to ensure that no challans/Paid Cheques are

lost/misplaced while handling documents in transit. In case of any missing

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challan/Cheques, Focal Point Branch in consultation with the Dealing Branch should

furnish requisite Certificates in lieu of the lost cheque/challan. On subsequent

availability of lost documents, the same should be forwarded to the Pay and Accounts

Officer quoting reference and date etc to enable the PAO to link the same at his end.

Efforts should be made by the designated Focal Point Branches to send “Error-free

Scrolls” to the Pay and Accounts Officer for prompt and accurate settlement of all the

Government transactions with utmost promptitude.

Based on the information furnished by the designated Focal Point Bank Branches,

Government Account Department, Mumbai generates through its computer centre

“Settlement Report” to be sent to Reserve Bank of India, Central Accounts Section,

Nagpur. The report is then faxed to State Bank of India Government Accounts Link
Office at Nagpur which in turn submits the same to Reserve Bank of India, Central

Accounts Section, Nagpur. The settlement of funds takes place at Nagpur through State

Bank of India’s local account maintained with RBI, C.A.S., Nagpur.

23.6.4 Submission of Date-wise Monthly Statement (DMS).

The “Focal Point” branch after the close of the month will also prepare in quintuplicate,

the Date-wise Monthly Statements (DMS) (Annexure 8) of the PAO of the Division and

four copies thereof to the concerned PAOs for verification latest by the 3rd of the

following month retaining fifth copy as office copy. Two copies of the monthly

statement will be returned by the PAO duly verified to the “Focal Point” branch within 3

days of receipt thereof. Out of the two certified copies so received by the branch, one

copy will be retained by the “Focal Point” branch and the other will be forwarded to its

Link Cell GAD, Mumbai

23.7 ROLE OF STATE BANK OF INDIA, GOVERNMENT ACCOUNT

DEPARTMENT (GAD), MUMBAI

23.7.1 (a) On receipt of daily memorandums/telegrams in respect of transactions

from various Focal Point Branches, the Government Accounts Department, Mumbai will

consolidate the position and report the consolidated figures (receipt/payment separately)

to RBI, Central Accounts Section, Nagpur for eventual settlement. SBI, GAD, Mumbai

while reporting the consolidated figure to RBI, CAS, Nagpur will also furnish a

certificate to the effect that relevant documents have been submitted by its focal point

branches to the respective Government officials.

23.7.2 (b) SBI, GAD, Mumbai will prepare four copies of monthly settlement

statement as per Annexure 11 and forward three copies thereof to the RBI, CAS, Nagpur

for verification before 2nd of the succeeding month. RBI after verification will forward

one copy (along with the monthly closing balance statement) to each Principal Accounts
Office of the Ministry/Department, one copy to SBI, GAD, Mumbai and retain one copy

for their record.

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23.7.3 (c) SBI, GAD, Mumbai will also prepare four copies of monthly settlement

statement PAO-wise showing transactions date-wise (Annexure-11) and forward original

copy to respective Principal Accounts Office, duplicate/triplicate copy each to the

respective PAO and Focal Point Branch(s) and retain the fourth copy for their record.

23.7.4 (d ) SBI, GAD, Mumbai will also prepare monthly settlement statement in

duplicate as per Annexure 12 and forward one copy thereof to respective Principal

Accounts Office of the concerned Ministry/Department.

23.7.5 (e) SBI, GAD Mumbai will furnish to CAS, Nagpur daily the Ministry’s

transaction statement. At the end of the month SBI will furnish to CAS, Nagpur (PAO

wise monthly statement of transactions and Ministrywise monthly statement of

transactions to enable CAS, Nagpur to submit consolidated monthly statement to the

Chief Controller of Accounts.

23.8 ROLE OF RESERVE BANK OF INDIA, CENTRAL ACCOUNTS

SECTION, NAGPUR

23.8.1 Central Accounts office of Reserve Bank of India, Nagpur on receipt of the

Report of Statements generated by Government Accounts Department, State Bank of

India, Mumbai and transmitted through State Bank of India, Link Cell at Nagpur will

carry out necessary adjustments in the accounts of the Ministry of Urban Development

and Poverty Alleviation and also in the Bank Account of State Bank of India.

After carrying out necessary adjustments, RBI, CAS, Nagpur will generate

Divisionwise/PAO-wise Receipts Put Through and Payments Put Through for onward

transmission to the Principal Accounts Officer of the Ministry and all other concerned for
further necessary action. Appendix “2” to chapter 1 of Civil Accounts Manual may also

be referred to on the detailed instructions on banking and accounting arrangements in

connection with the receipts and Payments of Government account by Public Sector

Banks.

23.9 ROLE OF PAY AND ACCOUNTS OFFICER

23.9.1 (i) PAO receives two types of Bank Scrolls viz., Receipt Scroll together with

Receipted challans and Payment Scroll together with Paid cheques from the designated

Focal Point Bank Branch. On receipt of these scrolls from the Bank, PAO is required to

scrutinize the same with reference to the supporting challans/Paid cheques and

discrepancy, if any, coming to notice is reported by him to the Focal Point Bank to

rectify the same. Such discrepancies should be got rectified either by personal contact, if

the Focal Point Bank Branch is near to the office of the PAO or by fastest mode of

communication as may be considered necessary. The accepted/verified amount of Main

Scroll should be noted in Form CAM 17 – Register of Public Sector Bank Suspense. On

receipt of DMS (Date-wise Monthly Statement), PAO should ensure that the figures

noted in Form CAM 17 tally with those indicated in DMS. In case of discrepancy, the

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same should be brought to the notice of the Focal Point Bank Branch for taking

corrective measures to settle the discrepancy.

(ii) Besides, PAO has to ensure timely submission of Main Scroll/DMS by Focal

Point Bank Branch and return of verified Statements within the stipulated time schedule.

Note: For adjustment of Bank Scrolls see para 23.16 regarding Adjustment of Bank

Scrolls in CPWD System.

23.10 ROLE OF DIVISIONAL OFFICER

Divisional officer will receive a copy of Receipts Scroll/Payment Scroll without

supporting Receipted Challans/Paid Cheques from the Dealing Branch of the Bank. He

will note these transactions in CPWA Form 51 to be sent along with Monthly Account to

the PAO of the Division.

Note: For detailed procedure see para 23.16 regarding Adjustment of Bank Scrolls in

CPWD System.

23.11 ROLE OF PRINCIPAL ACCOUNTS OFFICER

On receipt of Statement DMA 1 together with PAO-wise/Date-wise break-up of Receipts

and Payments transactions for the month from State Bank of India, Government Account

Department, Mumbai and Statement DMA-2 showing PAO-wise summary of

transactions for the month from Reserve Bank of India, Central Accounts Section,

Nagpur. Principal Accounts office should exercise checks prescribed in Para 13.7 of

Civil Accounts Manual on receipt of DMA-2 and CAS-122 statements.P Thereafter

Principal Accounts Office will proceed to clear the Minor Head “108 – Public Sector

Bank Suspense” below the Major Head “8658 – Suspense Accounts” by operating contra

entries under the Major/Minor/Sub-Head “8675 – Deposits with Reserve Bank”, “101-

Central (Civil)” “Reserve Bank (PSB)”. As soon as the Head “108 – Public Sector Bank

Suspense” is cleared, an intimation shall also be sent to the PAO of the Division to enable

him to incorporate the figures in his Broadsheet and other connected records.

23.12 SELF MONITORING

23.12.1State Bank of India, GAD, Mumbai will also receive a copy of certified DMS

from its Focal Point Branch latest by the 10th of the following month. On receipt,

thereof, the GAD Cell should compare entries of receipts and payments in respect

of each Division/PAO date-wise with reference to the amounts put through as

shown in Annexure 8. In case it finds that the amount as shown in the DMS and

as appearing in annexure 8 differs, it should adjust the difference in the daily

advice for the next day showing corrections distinctly giving a reference to the

date of each transaction. This will ensure settlement of accounts on self

reconciliation basis. In doing so, it should keep a note of corrections in the DMS

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so that, if later, the same discrepancy is pointed out by the Focal Point Branch at

the instance of the PAO, double adjustment is avoided.

23.13 MARCH RESIDUAL TRANSACTIONS

23.13.1 In order to ensure that the transactions pertaining to a financial

year are adjusted to the extent possible in the same financial year, dealing branches of the

Banks are required to report the transactions handled by them on behalf of the

Ministry/Department with which these have been accredited, to their Focal Point Branch

with utmost promptitude to enable the Focal Point Branch to report the same to Reserve

Bank of India, Central Accounts Section, Nagpur through their Link Cell/GAD, Bombay

in case of State Bank of India. Transactions taking place from 15th March till the end of

the month should be reported by the Focal Point Branch to Link Cell/GAD, Mumbai in

the case of State Bank of India by Telex/Telegrams etc. In case of the residual March

Transactions which could not be reported to Reserve Bank of India, Central Accounts

Section, Nagpur during the concerned financial year for one reason or the other, the Focal

Point Branch should segregate from 1st April all transactions pertaining to the previous

Financial Year and for current Financial Year for preparing separate Main Scrolls for the

residual transactions effected at the dealing branch in March or earlier period of previous

Financial Year and for the correct transactions effected in respect of the current Financial

Year from 1st April onwards. As the accounts of the Reserve Bank of India CAS, Nagpur

remain open upto 15th April to accommodate residual transactions of previous financial

year, the Focal Point Branch should report March residual transactions to the Link
Cell/GAD, Mumbai as the case may be through separate Daily Memo for the adjustment

with RBI, CAS, Nagpur. Monthly statement of March Residual Transactions must be

sent to the PAO latest by 30th April for their accountal in the previous financial year.

23.14 AGENCY COMISSION/TURN OVER COMMISSION

23.14.1 State Bank of India, GAD, Mumbai through its Link Cell of local SBI at

Nagpur will arrange to submit claims for agency Commission/ Turn over Commission in

regard to the Government transactions settled with the Reserve Bank of India, Central

Accounts Section, Nagpur to that office on quarterly basis. While admitting the claims of

Turn over Commission preferred by the Link Cell of SBI, it has to be ensured that

adjustments of discrepancies have been carried out in Accounts and there is no double

claim of Turn over Commission on account of such adjustments. The revised rates of

Turn over Commission/Agency Commission for handling Government transactions by

the Public Sector Banks/ Other Nominated (Private Sector) banks would be Rs.45/-per

transaction for Receipts, 9 paisa per Rs.100/- turnover per transaction for Payments oher

than pension and Rs.60/- per transaction for Pension w.e.f 01-07-2005.

Note: Excess amount shown in the Receipt Scrolls and Payment Scrolls should be

adjusted by withdrawal ie., by Minus in the Receipt Scroll and Payment Scroll on the

date in which such corrections have been carried out to avoid double claim of Turn over

Commission. In no case the excess amounts wrongly entered in the Bank Scroll should

be corrected by Contra Debit or Credit, as the case may be. For wrong scrolling no

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Agency Commission/Turn over Commission shall be payable by the Reserve Bank of

India.

23.15 RECOVERY OF INTEREST FROM BANKS ON DELAYED

REMITTANCES OF GOVERNMENT RECEIPTS INTO GOVERNMENT

ACCOUNT AND EXCESS/DOUBLE REIMBURSEMENT OF CLAIMS

23.15.1 1. Permissible period for remittance of Government Revenues

a) Local Transactions – Wherever the collecting branch and the focal point

branch are in the same city/agglomeration, the settlement of transaction with RBI

will have to be completed within T+3 working days (where T is the day when

money is available to the Branch). For calculating the working days, the RBI

calendar will be followed. This has been implemented from 01.5.2005.

b) Outstation Transactions - Wherever the collecting branch and the focal

point branch are in different city/agglomeration, the settlement of transaction with

RBI will have to be completed within T+5 working days (where T is the day

when money is available to the Branch). For calculating the working days, the

RBI calendar will be followed. This has been implemented from 01.5.2005.

c) Cases for relaxation of the permissible period in respect of difficult

areas/or due to matters beyond control of the banks will be forwarded on a caseto-

case basis to the Office of CGA through the Ministry for approval.

23.15.2 2) Provision of charging interest on delayed remittance i.e., ‘Delayed

Period Interest”.

a) Total amount, which has not been remitted in time and the penalty due

alongwith the details of the individual cases will be intimated by the Ministry to

the Headquarters of the Bank concerned on a quarterly basis by the 15th of the

following month. The period of delay for this purpose will be counted from the

date of receipt of the collection at the receiving branch (actual realization of

money in the bank) till they are reported to RBI, CAS, Nagpur for credit to

Government Account through the bank’s link cell at Nagpur.

The present system of charging penalty at Bank rate + 2% (Bank rate will be
as notified by RBI on 1st May and 1st November every year) will continue. The

charges shall be known henceforth as ‘Delayed Period Interest’.

b) Delayed period interest will be recoverable from the Bank regardless of

the amount involved.

23.15.3 Interest on delayed remittances and double/excess reimbursement shall be

charged @ 8% i.e, Bank Rate 6% plus 2% with effect from 1st May 2005.

Note – The above procedure will not be applicable to Private Sector Banks(Authority:

CGA’s OM No.S-11012/3/P.Int/CGA/RBD/2003-04/396 dated 31.3.2005 read with

CGA’s OM No.S-11012/3/2003-04/Pt.III/RBD/466 dated 16.5.2005)

23.15.4 Interest on delayed remittances and on double/excess re-imbursement shall

be credited to sub-head “Interest from Banks on delayed remittances and excess/double

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reimbursement” under the Minor Head “800 – Other Receipts” below the Major Head

“0075 – Miscellaneous General Services”.

23.16 ADJUSTMENT OF BANK SCROLLS IN CPWD SYSTEM

23.16.1 In CPWD System, all the receipts and payments arising in a Division are

accounted for under the final heads concerned ab-initio by the Divisional Officer by

passing necessary entries in the Books of accounts maintained in his office. As and when

the receipts are realized or received in cash or by cheque or Bank Draft, the same are

credited under the proper receipt head of account and in case of refund minus Debited to

the Expenditure head of Account flowing from the Consolidated Fund of India e.g.

refund of LTC advance in cash by a Divisional Accountant of Public Works Division

shall be Minus Debited to Major/Sub-Major/Minor-Head “2059 – Public Works” – “80-

General” “001 – Direction and Administration” – Refund of LTC Advance.

23.16.2 After adjusting the receipts received in cash or by cheque/Demand Draft

under the proper receipt or refund heads of account, the cash or cheque or Demand Draft

shall be sent to Bank for realization by Debiting Sub-Head “Remittances into Bank”

under the Minor Head “102 – Public Works Remittances” below the Major Head”8782 –

Cash Remittances etc”.

23.16.3 Similarly the Payments made either from the Consolidated Fund of India

or from Public Account of India shall be debited under the concerned functional

Major/Sub-Major/Minor Heads of Account per Contra Credit to Sub-Head “Public Works

Cheques” under the Minor Head “102 – Public Works Remittances” below the Major

Head “8782 – Cash Remittances etc”

23.16.4 Refund of Revenue falling under Sector B – Non-Tax Revenue shall be

classified under the Minor Head “900 – Deduct-Refunds” below the concerned

Major/Sub-Major Heads of Account in terms of General Direction 2.2 to the List of

Major and Minor Heads of Account per contra Credit to Sub-head “Public Works

Cheques” under the Minor Head “102-Public Works Remittances” below the Major Head

“8782-Cash Remittances etc”

23.17 ADJUSTMENT OF RECEIPTS SCROLL/PAYMENTS SCROLL IN THE

DIVISION

23.17.1 Subsequently on receipt of the copy of Receipts Scroll and Payments

Scroll without Receipted Challans/Paid Cheques from the dealing branch of the

accredited Bank, Divisional officer will enter the transactions of Receipts Scroll and

Payments Scroll in Part 1 “Cash Remitted and Acknowledged” and Part II Cheques

issued and Paid respectively in Form 51 to be sent along with the Monthly Account to the

PAO of his Division for reconciliation purposes.

23.18 ADJUSTMENT OF RECEIPTS SCROLL AND PAYMENTS SCROLL BY

THE PAO OF THE DIVISION

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23.18.1 On receipt of Receipts Scroll with Receipted Challans and Payments

Scroll with Paid Cheques from the Focal Point Branch of the accredited Bank, PAO of

the Division will adjust the same as under:-

For the adjustment of the Receipts Scroll, PAO of the Division after proper

verification thereof will Debit Minor Head “108 – Public Sector Bank Suspense” below

the Major Head “8658 – Suspense Accounts” per Contra Minus Debit to Sub-head

“Remittances into Bank” under the Minor Head “102 – Public Works Remittances”

below the Major Head “8782 – Cash Remittances etc”.

23.18.2 Original Debit appearing under the Sub-head “Remittances” into Bank in

the Books of Division gets cleared by Minus Debit to the same Sub-head as per the above

mentioned entry made by the PAO of the Division.

23.18.3 For the adjustment of Payments Scroll, PAO of the Division after proper

verification shall afford Minus Credit to Sub-head “Public Works Cheques” under the

Minor Head “102-Public Works Remittances” below the Major Head “8782 – Cash

Remittances” etc per contra credit to Minor Head “108 – Public Sector Bank Suspense”

below the Major Head “8658 – Suspense Accounts” Minus credit to Sub-head “Public

works cheques” in the books of the PAO of the Division would clear the original credit

under the same sub-head appearing in the books of the Divisional Officer at the time of

issue of the cheque.

23.19 CLEARANCE OF MINOR HEAD “108-PUBLIC SECTOR BANK

SUSPENSE” BELOW THE MAJOR HEAD “8658 – SUSPENSE ACCOUNTS”

BY PRINCIPAL ACCOUNTS OFFICE

23.19.1 Principal Accounts Officer of the Ministry of Urban Development and

Poverty Alleviation, on receipt of “Put Through Statements” from the Reserve Bank of
India will clear the Receipts Put Through by preparing a Transfer Entry affording Debit

to Major/Minor/Sub-head “8675 – Deposits with Reserve Bank” “101 – Central (Civil)”,

“Reserve Bank (PSB)” and Minus Debit to Minor Head “108-Public Sector Bank

Suspense” below the Major Head “8658 – Suspense Accounts”.

23.19.2 Similarly Payment Put Through Statement shall be adjusted through

Transfer Entry by Minus Credit to Minor Head “108-Public Sector Bank suspense”

below the Major Head “8658 – Suspense Accounts” and Credit to Major/Minor/Sub-head

“8675 – Deposits with Reserve Bank” “101-Central (Civil)” “Reserve Bank (PSB)”. The

above mentioned adjustments made by the Principal Accounts Officer will be intimated

to the PAO of the Division to keep a suitable note against the original entries appearing

under the Minor Head “108 – Public Sector Bank Suspense” below the Major Head

“8658 – Suspense Accounts” in the Broadsheet of Public Sector Bank Suspense.

23.20 PROCEDURE FOR BANK RECONCILIATION

215

23.20.1 Bank reconciliation is conducted in the following four stages in the

CPWD System of Accounts:-

1. Reconciliation between Bank Scrolls and Datewise Monthly Statement i.e.,

between Pay and Accounts Office and the Focal Point Bank Branch.

2. Reconciliation between Datewise Monthly Statement and Put Through

Statement i.e., between Reserve Bank of India, Central Accounts Section,

Nagpur and the Principal Accounts Office of the Ministry of Urban

Development and Poverty Alleviation.

3. Reconciliation between Controller General of Accounts/Chief Controllers of

Accounts and the Reserve Bank of India, Central Accounts Section, Nagpur.

4. Reconciliation between the cheques issued and remittances made by the

Division on one hand and the cheques encashed and remittances accounted for

by the Bank

23.20.2 FIRST STAGE OF RECONCILIATION

In the Public Works System of Accounts, the original Receipts and Payments

transactions arising in a Public Works Division are initially accounted for under the

proper Receipts, Refunds and Payments Heads of Accounts in the books of Accounts

maintained by the Divisional Officer concerned. Bank Draft concerning the receipt of the

Division are remitted into Bank for collection by debiting Sub-Head “Remittances into

Bank” under the Minor Head “102 – Public Works Remittances” below the Major Head

8782 – Cash Remittances and adjustments between Officers rendering accounts to the

same Accounts Officer. The Payments made by the Divisional Officer are debited to the

final functional Major/Sub-Major/Minor/Sub-Head/Detailed Head/Object Head

concerned per contra credit to Sub-Head “Public Works Cheques” under the above

mentioned Major and Minor Heads. However, the Receipts Scrolls together with

Receipted Challans and Paid Cheques together with Paid Cheques are sent directly to the

Pay and Accounts Officer of the Division by the designated Focal Point Bank Branch of

the State Bank of India for adjustment of the Cash balance under the Minor Head “108 –

Public Sector Bank Suspense” below the Major Head “8658 – Suspense Accounts”.

On receipt of the above mentioned Receipts Scroll and Payment Scroll, PAO of

the Division scrutinizes the figures with reference to the enclosed Receipted Challans and

the amount of Paid Cheques reported by the Focal Point Bank Branch. In this connection

checks to be exercised by the PAO as prescribed in Para 13.6 of Civil Accunts Manual,

may be referred. Discrepancy, if any, coming to notice is reported to Focal Point Bank

Branch for taking remedial measures to set right the discrepancy through “Eror Scroll”.

Such discrepancies as far as possible should be got rectified by personal collaboration, if

the Focal Point Bank Branch is near the office of the Pay and Accounts Officer of the

Division or alternately by the fastest mode of communication.

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The accepted/verified figures of Main Scroll should be noted in the Register of

Public Sector Bank Suspense in CAM Form 17. On receipt of DMS, the entries should

be checked with reference to the transactions booked in CAM Form 17. The total of

DMS must tally with the total of CAM Form 17. Any discrepancy coming to notice be

reported to the Focal Point Bank Branch for taking corrective measures.

23.20.3 SECOND STAGE OF RECONCILIATION

Put Through Statement received from the Reserve Bank of India, Central

Accounts Section, Nagpur should be compared with DMS. The transactions settled in the

same month should be ticked off in the DMS and the remaining transactions not included

in the Put Through Statement should be watched/pursued for expeditious settlement of

cash balance under the Major Head “8675 – Deposits with Reserve Bank”.

23.20.4 THIRD STAGE OF RECONCILIATION

Third stage of Bank reconciliation between the Controller General of Accounts,

Chief Controllers of Accounts and the Reserve Bank of India, Central Accounts Section,

Nagpur is conducted through Reserve Bank Deposit (R.B.D.) Section of the Controller

General of Accounts in regard to the Cash balance position of the Government of India,

as a whole.

23.20.5 FOURTH STAGE OF BANK RECONCILIATION

As has already been explained in the first stage of Reconciliation that the Focal

Point Bank Branch sends Receipts Scroll alongwith Receipted Challans and Payments

Scroll together with Paid Cheques to the PAO of the Division for clearing the cheque

head whether operated for Remittances into Bank or for issue of the cheque, the Dealing
Branch of the accredited Bank sends a copy of the Scrolls without supporting Receipted

Challans and Paid Cheques to Divisional Officer of the Division concerned. On receipt

of the copy of daily Receipt Scroll and Payment Scroll, the Divisional Officer effects a

reconciliation in CPWA Form 51 indicating the difference between the cheques issued

and remittances made but not accounted for during the month as well as cheques issued

and remittances made during the previous months accounted for in the Bank Scrolls

during the month on hand. This Schedule of Reconciliation of Cheques drawn and

Remittances in CPWA Form 51 is sent alongwith Monthly Account of the Division to the

PAO of the Division for reconciliation purposes.

23.21 RECONCILIATION OF GOVERNMENT TRANSACTIONS UNDER

GAD SYSTEM

23.21.1 In GAD System there are two types of reconciliation i.e. Internal and External.

23.21.2 INTERNAL RECONCILIATION

23.21.2 (i)(a) Between Dealing Branch and Focal Point Branch.

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(i) The dealing Branches are required to maintain a Register which is called GAD – 2

Register. The summary of the day’s transactions i.e. Receipts and Payments are to be

entered in this Register date-wise. At the end of the month the duplicate copy of the

day’s summary is required to be sent to Focal Point Branch. The Focal Point Branch on

receipt of GAD-2 from Dealing Branch will scrutinize the statement to ensure that all the

Government transactions handled by Dealing Branch have been accounted for by Focal

Point Branch.

(ii) Similarly, the Focal Point Branches are required to maintain a Register called GAD-3

i.e. Dealing Branch-wise Ledger of RBGG (Receiving Branches Government General

Accounts) to be prepared in triplicate for the purpose of accounting and reconciliation to

be submitted Monthly to the Controller of the Dealing Branch and Focal Point Branch.

All the transactions reported by Dealing Branches are entered in this Register date-wise.

At the end of the month a copy of GAD-3 Register will be sent by Focal Point Branch to

Dealing Branch which in turn is required to verify that the transactions reported by

Dealing Branches have been accounted for by Focal Point Branch.

(iii) The above exercise ensures that all the transactions handled by Dealing Branch have

been accounted for at Focal Point Branch.

(iv) In case of any discrepancy in GAD-2 and GAD-3 Register, both the branches i.e.

Dealing Branch and Focal Point Branch are required to act promptly to rectify the

discrepancy.

23.21.2(ii)(b) Between Focal Point Branch and GAD

(i) The Focal Point Branches are required to confirm the messages sent by fastest mode

of communication i.e. PC Modem/Fax/Telex/e-mail etc to GAD for fund settlement

purposes. This is done by the Daily Memo. If any discrepancy is found between earlier

settlements and figures reported in Daily Memo, amendments is proposed treating Daily

Memo as correct. The Branches are also required to send Daily Statement GAD-4 (i.e.,

Government General Account Daily Statement prepared only after balancing of clear

Cash Book for the purpose of reporting Central Government Transactions to be submitted

to GAD, Navi Mumbai through Zonal Office and Local Head Office to reach within

seven days.) which lists system-wise transactions. The processing of GAD-4 is done at

the computer centre and settlement entries are matched with Statement entries as

reflected in GAD-4. Once these entries are matched, the transactions are treated as

reconciled.

(ii) The entries which are not reconciled and where amendments are proposed by

branches on account of mistakes detected subsequently, they are referred to branches for
seeking clarification/supporting documents through Enquiry Memoranda on receipt of

replies from concerned branches, GAD, Central Office proposes necessary amendments

to Reserve Bank of India, Central Accounts Section, Nagpur and entries are reconciled.

218

The above procedure is a part of Internal reconciliation which ensures that all the

Government transactions handled by Dealing/Focal Point Branches are correctly

accounted for and settled with Reserve Bank of India, CAS Nagpur.

23.22 EXTERNAL RECONCILIATION

23.22.1 The reconciliation of Government transactions as reflected in the Books

with those maintained by the office of the Chief Controller of Accounts is vital. To this

end, the Focal Point sbranches prepare Datewise Monthly Statement (DMS) of

transactions handled at Focal Point Branch and submit it to PAO concerned which in turn

verifies the same as per their records and return two copies thereof to the Focal Point

branch, one of which is sent to GAD, Central Office, Mumbai. Verified Date-wise

Monthly Statement (VDMS) is termed as mutually accepted document between Bank and

the accounting authority of the office of the Chief Controller of Accounts, Ministry of

Urban Development and Poverty Alleviation and as such is the final document for

reconciliation. The VDMS when received at GAD, Central Office, Mumbai is compared

with the settlement already made and for the differences, if any, amendments are

proposed to complete the exercise of reconciliation. This is turned as External

Reconciliation with the Government Accounting Authority i.e., the Chief Controller of

Accounts of the Ministry of Urban Development and Poverty Alleviation.

23.23 PROBLEM AREAS

23.23.1 Even though the existing Banking arrangements are fool-proof yet still there

are some grey areas where the Divisional Officers and the Pay and Accounts Officers of
the Divisions are required to take extra precaution to ameliorate the problems.

Problematic areas with their direct impact on the Cash Balances of the

Government of India in general and the Ministry of Urban Development in particular are

discussed in brief as under:-

23.23.2 Late transmission of Bank Scrolls by Dealing Branch to Focal Point Branch

and by Focal Point Branch to the Pay and Accounts Officer.

Late transmission of Bank Scrolls to the Pay and Accounts Officer through proper

channel of Bank branches results in non-accountal or late accountal of Receipts/Refunds.

It adds the number and amounts of outstanding cheques. It presents a distorted picture of

Cash Balance position of the Ministry and increases the number of time barred cheques.

It also hampers Bank Reconciliation.

23.23.3 Wrong Scrolling

23.23.3(i) Deviation between the figures of supporting challans/cheques and the

figures scrolled in Bank Scroll, say the receipt of Rs.540/- wrongly scrolled as Rs.5,040.

It would result in a difference of Rs.4,500 which would create problem in balancing the

Account.

(ii) Wrong inclusion of Challan or Cheque of other Ministry/Department will

have its impact on the cash balance of the Ministry.

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(iii) Deviation between Daily Memorandum of Advice i.e., DMA(R) or

DMA(E) and Date-wise Monthly Statement (DMS) creates problem in reconciliation.

23.23.4 Excess or Double Put Through

(i) Excess or Double Put Through results in depletion of cash balance of the

Ministry. It also results in excess or double payment of turnover

commission payable by Reserve Bank of India

(ii) Creates problems in Bank reconciliation.

23.23.5. Wrong adjustment of March Residual Transactions

The procedure for adjustment of March residual transaction has already been

explained in Para 23.13 of this Chapter. The Accounts of Reserve Bank of India remain

open upto 15th April or upto the date as may be extended on year to year basis by issue of

necessary orders by the competent authority in this behalf of next financial year for

carrying out adjustments of March Residual transactions for which separate scrolls after

due segregation of March transactions from the April transactions are required to be sent

for proper adjustment. But in practice it has been observed that Banks mix up the

transactions of March with April transactions which are accounted for in next financial

year. This mix up gives a horrible picture of Accounts.

23.23.5 Other Factors

(i) Missing supporting documents viz Missing Challans/Cheques and in the

absence of missing documents the receipt or refund or clearance of cheque

remain unadjusted.

(ii) Wrong adjustment of differences by affording Debit or Credit to set off

excess credit or debit instead of reducing the difference by affording

minus debit or minus credit, results in double payment of Turnover

commission payable to the accredited Banks byReserve Bank of India.

23.23.6 All these problems could be avoided if the action is initiated by the concerned

quarters right from the receipt of Bank Scrolls till their adjustment under the proper heads

of account to facilitate Bank reconciliation at the end.

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CHAPTER 24 MISCELLANEOUS

24.1 Cheque Books, Receipt Books and Cash Memo Books

The following procedure will be followed in regard to indenting, safe custody, issue and

accountal of cheque Books:-

24.1.1 Annual Indent – All the Cheque Drawing and Disbursing Officers (hereinafter

called C.D.D.Os) of the Central Public Works Divisions will assess their annual

requirement of all the three categories viz., “A”, “B” and “C” cheques/cheque scrolls

required for making payments. Cheque Drawing and Disbursing officers will send their

requisition of all the categories of cheques indicating total number of each category of

cheque required to their respective Pay and Accounts Office. Similarly Pay & Accounts

Officer of the Division will assess his own requirement and include the same in the

Annual Indent of Cheque Books/Cheque Scrolls. The concerned Pay and Accounts

Officer, after examining the details/requirements furnished by the CDDOs will

consolidate Divisionwise requisition of all the CDDOs alongwith his own demand for

onward transmission to the accredited Bank i.e., State Bank of India.

24.1.2 Issue of Cheque Books to Divisional Officers and the Pay and Accounts Officer

of the Division.

The Divisional Officers as well as Pay and Accounts Officer of the concerned

Division will send their requisition direct to the State Bank of India well in advance to

enable the Bank to deliver the requisite Cheque Books in time.(See paragraph 6.7 of this

code)

24.1.3 Stock Register of Cheque Books – A Stock Register of Cheque Books/Forms

should be maintained to keep an account of the receipts, issues and balances of cheque

books/forms (Form CAM 1). Each morning the cheque cashier should take such cheque

books from the Officer-in-Charge, as are likely to be used during the course of the day

and should remain responsible for their use and return of the balance at the close of the

day.
24.1.4 In cases, where the power of drawal of funds by cheque(s) is withdrawn from any

cheque-drawing Divisional Officer, all the unused form from the partly used cheque

books with that officer shall be defaced by writing the word “Cancelled” promptly across

such cheque form and its counterfoil/record slip (but without the signature of the

Drawing Officer) and returned to the Pay and Accounts Officer concerned who should

destroy them after keeping a note in the relevant records. All unused cheque books with

such an officer shall however be returned by him to the Pay and Accounts Officer

without any cancellation.

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24.1.5 Whenever a new cheque book is brought into use, the DDO should intimate the

number of the cheque book and the Serial Number of the Cheque forms contained therein

to the Bank as well as the Pay and Accounts Officer.

24.1.6 Daily Account of Cheque Books used – An account of the cheque books/forms

used daily should be maintained by the Cashier (in Form CAM 2) and submitted to the

Divisional Officer at the time of closing of accounts daily. In this register, the cheque

numbers used during the day should also be noted.

24.1.7 Stock taking at the change of the Officer-in-Charge – Every six months, in April

and October, stock taking of the cheque book should be done by an Officer other than the

Officer-in-Charge and a certificate of physical count recorded by him in the Stock

Register. This stock taking should also be done whenever there is a change of the

Officer-in-Charge and the relieving Officer should initial the entry in respect of each of

the cheque book noted in the Form CAM 2 and sign a certificate in the Stock Register in

the following form:-

“Received the current cheque books as indicated by my initials in the register of account

of cheque forms and the unused cheque books from ---------to----------as entered in the
Stock Register.”

24.1.8 The physical verification can also be entrusted either to the Inspecting Officer of

the internal inspection party conducting the normal inspection of his office or by any

gazetted officer of his department who visits that office on any other official work.

24.2 TRANSFER OF CHARGES

1. DIVISIONAL AND SUB-DIVISIONAL OFFICERS

24.2.1 The Relieving Officer will take into account the expenditure in cash and on stores,

as the case may be, from and for the first day of the month during which the relief took

place, and submit the next monthly account in the same manner as if he has been

incharge during the whole month. But the relieved officer remains responsible for the

transactions during his incumbency.

24.2.2 In the case of transfers of divisional or sub-divisional charges, the cash book in

the case of Divisional Office or imprest account in respect of Divisional Office and Sub-

Divisional office should be closed on the date of transfer, and a note recorded in it, over

the signatures of both the relieved and relieving officers showing the cash or imprest

balances, the number of unused cheques made over and received in transfer by them as

the case may be. A copy of this note, together with a receipt in the form appended below

for the stores under the immediate charge of the relieved officer, should be forwarded on

the same day to the Superintending Engineer in the case of divisional or to the Divisional

Officer in the case of sub-divisional charges.

The receipts of cash and a stores balances should be prepared by the relieved

officer, but the relieving officer should note any inaccuracies therein so that the

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Superintending Engineer or the Divisional Officer, as the case may be, may pass such

orders in respect of any deficient articles as may be necessary. A copy of the receipts
may be given to the relieved officer, if desired by him.

FORM A

(For Sub-divisional charge)

Received in transfer from A.B., formerly Divisional Officer……….Division, the stores in

his personal charges as detailed in the annexed list.

The priced Stores Ledger and the Tools and Plant Ledger are on record and have been

posted uptodate/to end of…………..

Station: CD

Date: Divisional Officer…………………Division

FORM B

(For Sub-divisional charge)

Received in transfer from A.B., formerly officer-in-charge…………..sub-division the

stock and tools and plant which have been in his personal custody as detailed in the Bin

cards and Tools and Plant Ledger, which have been posted uptodate.

Station: CD

Date: (Relieving) Sub-Divisional Officer.

II. DIVISIONAL ACCOUNTANTS

24.2.3 When a Divisional Accountant is about to be relieved of his duties in a divisional

office, either permanently or temporarily, he should prepare a memorandum reviewing

the accounts of the Division. The state of stock and other suspense accounts and of

outstandings in the accounts of works should be reviewed in particular. All important

liabilities as also recoveries to be made from the staff or from contractors and others

which should receive special attention should be mentioned.

Any arrears or defects in the working of the divisional office or subordinate

offices rendering accounts to it should be specified with a statement of the remedies

applied or contemplated. Other points requiring the special attention of the relieving

Accountant, whether in regard to the initial or compiled accounts or to Inspection Notes

received from Chief Controller of Accounts should also be sent forth in detail.

The memorandum should be in a tabular form with columns for (1) remarks by

the relieving Accountant (2) remarks by the Divisional Officer and (3) Orders of the

Chief Controller of Accounts/Controller of Accounts. The relieving Accountant should

examine it when taking over charge and promptly forward it with his remarks, to the

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Controller of Accounts/Chief Controller of Accounts through the Divisional Officer, who

will record such observations, as he may consider necessary.

24.3 RECONSTITUTION OF EXECUTIVE CHARGES

24.3.1 When in consequence of the reconstruction of executive charges or of any

other arrangements, the accounts of two or more Divisional Officers are to be

amalgamated or those of any office are either to be broken up into parts or closed,

the Divisional Officer concerned should apply in time to the Chief Controller of

Accounts for instructions to be observed in regard to accounts in giving effect to

the arrangements. On all occasions, the necessary transfer between offices of

unsettled accounts (for example, see below) of liabilities not yet brought to

account, of quantity account of tools and plant and road metal, and of relevant

account and establishment records (including unused forms of cheque books,

receipt books and cash memo books) should receive the special attention of all

concerned.

(i) Work in progress and suspense account of Works.

(ii) Appropriation and sanctions not yet completely operated upon.

(iii) Stock and other suspense accounts.

(iv) Remittance Accounts.

(v) Deposit and cash balances.

(vi) Unrealised licence fee and other revenue, and

(vii) Interest bearing securities.

Note 1: At the time or re-organisation of P.W. Divisions, the outstanding balances

of Suspense and Deposit heads in the books of the Division to be abolished and/or

merged with another Division(s) may be transferred by the closing division to the

successor division(s) with which it is to be amalgamated by Cash Settlement.

The following procedure should be followed by the closing and successor

division(s) in effecting the transfer of these balances, to ensure that there has been

no omission in taking over the balances under these heads in the books of the

successor division(s).

(a) If the balances are proposed to be transferred to two or more divisions,

the closing division should make out two copies of the various registers

showing therein the items proposed to be transferred to each division

alongwith the cheque and forward the same to division(s) concerned with

a forwarding letter requesting them to incorporate those figures in the

balances of the latter division(s) and endorse a copy to the Pay and

Accounts Officers of the concerned Divisions intimating the total amount

under each head that is proposed to be transferred to each division. The

registers of the closing division, duly completed, should be transferred to

the division, which is nominated as its successor and to which the entire

records of the defunct division are transferred. If, however, the entire

balances are proposed to be transferred to one division only, the closing

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division may simply transfer the registers duly completed alongwith a

cheque for the amount to the successor Division. The closing division

should quote Number and date of the letter, with the details of the cheque

under which balances are transferred to the successor division(s) in the

relevant schedules to be submitted to the Pay and Accounts Officer and

show the closing balances under various heads as ‘nil’ on this authority.

(b) The division(s) to which the balances have been transferred after the

receipt of the cheque should incorporate the balances in its/their books

immediately. The balances so transferred by the closing division should

be incorporated in their entirety by the successor division(s). Discrepancy,

if any may be settled subsequently with the successor division to which

the records of the closing division have been transferred.

Note 2: In the event of closure of a Division only the wholly un-used receipt books

and Cash memo books should be brought into use by the successor division. The

un-used forms in partly used receipt books and cash memo books should be

cancelled by the Officer-in-Charge of the closed division by drawing two

diagonal lines and inserting the word “Cancelled” in between.

24.4 DESTRUCTION OF RECORDS

24.4.1 The destruction of account records in Public Works offices is governed by such

rules as may be prescribed by Government with the concurrence of the Chief Controller

of Accounts provided that, in cases not covered by such rules, the specific concurrence of

the Chief Controller of Accounts is necessary before any records are ordered to be

destroyed and that in each Divisional Office full details are maintained permanently in

Form 97 of all records destroyed from time to time.

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Appendix-1 – Not Printed

226

APPENDIX-2

For revised coding pattern of Major and Minor heads of Accounts and revised

classification list of Public Works Receipts & Disbursements, List of Major and Minor

Heads of Account of Union and States and Government Accounting Rules 1990 may be

referred to.

Statement A

Main classification of Expenditure pertaining to Irrigation, Navigation,

Embankment and Drainage Projects.

All work of Irrigation, Navigation, Embankment, Drainage and Water Storage are

primarily classified into the following two sections:

A. Irrigation Works – The section includes Water Storage Works also.

B. Navigation, Embankment and Drainage Works – This section includes

receipts and charges relating to water ways, navigable canals, embankments

and other agricultural and drainage works undertaken primarily not for

irrigation purposes but for general improvement of the country or for general

administrative purposes.

2. Works for either of the two classes mentioned above are classified further into:-

1. Productive and

2. Unproductive

3. To admit of a new work being classified as a productive Public Works, the

following conditions must be satisfied:-

(a) There must be good reason to believe that the revenue derived from it will, within

ten years after the probable date of its completion, repay the annual interest on capital
invested calculated at “such rates as may be determined by the Government from time

to time under para 4(1) below”, but in preparing a project for sanction no deduction is

to be made from the total capital outlay on account of anticipated excess of revenue

over similar interest.

Note 1 – Capital invested includes (1) direct charges (2) indirect charges and (3) all

arrears of simple interest, if any, i.e., balance of total interest over total net revenue.

Note 2 – Betterment Levy is taken in reduction of indirect capital expenditure in the

proforma account of the project viz.

(a) Financial Forecasts, Administrative Accounts etc. although it is treated as

indirect receipt for the purpose of general account.

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(b) It must be susceptible of having clear Capital and Revenue Accounts of it

kept.

(c) Its classification as a productive Public Works must be authorized by

competent authority.

4. The rule for determining (1) whether a work which has been classified as

productive, shall continue to be so classified and (2) whether an unproductive work

may be reclassified as productive are as follows:-

I. Every Irrigation, Navigation, Embankment or Drainage work (Commercial)

should, until ten years after the date of the closure of its construction estimate, be

classified as productive if the net revenue anticipated from it appears likely to repay

on the expiry of that period the annual interest charges on the capital invested

(including direct and indirect charges and arrears of simple interest), calculated at

such rates as may be determined by the Government from time to time. Conversely,

if it is not expected to yield the relevant return, it should be classified as

unproductive. If, however, at any time during the period of construction, or within

ten years of the closure of its construction estimate, it becomes apparent that a work

originally classified as productive will not actually be remunerative according to the

criterion prescribed above, it should be transferred from the productive to the

unproductive class; and similarly if it becomes obvious during the same period, that a

work sanctioned as unproductive will actually prove remunerative the transfer of the

work from the unproductive to the productive class may be effected.

II. Every work classified in accordance with Rule No.1 above will retain its

classification unchanged during the eleventh, twelfth and thirteenth years after the

closure of its construction estimate.

III. If any irrigation, navigation, embankment or drainage work (commercial) which

is classified as productive fail at any time after the expiry of ten years, from the date

of the closure of its construction estimate, in three successive years to yield the

relevant return prescribed in Rule I above it should be transferred to unproductive

class. A work classified as unproductive which succeeds in yielding, in three

successive years, the relevant return prescribed for a productive work, may, on the

same principle, be transferred to the productive class.

IV. If an existing irrigation, navigation, embankment or drainage work be extended

or improved, the criterion of productivity prescribed in Rules I and II above shall be

applied to the whole system, including such extension or improvement, as if such

extension or improvement, had been executed simultaneously with the original

work. As an exception to this rule, if any extension be, owing either to its nature or

magnitude, such as may reasonably be considered to be a separate project and if it be

susceptible of having clear capital and revenue accounts kept of it, as distinct from

those of the project as a whole, it should be treated as a separate project and in that
case the conditions relating to the original projects and not those relating to

extensions and improvements shall be applicable. In all such cases separate capital

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and revenue accounts should be maintained for the extension in order to enable the

productivity test to be periodically applied.

V. The Local Administration may postpone the transfer of a work from one class to

the other in cases in which it is satisfied that its success or failure is due to purely

transitory causes.

5. The transfer of a work from the productive to the unproductive category or vice

versa will affect the recording of all future transactions in connection with it. No

adjustment will be made in the general account in respect of past transactions but the

necessary transfer will be effected by the Pay and Accounts Officer in the Proforma

Accounts of works in question.

6. The Principles to be observed in deciding whether an item of expenditure should

be charged to Capital or to Revenue are as follows:-

(a) Capital bears all charges for the first construction and equipment of a project, as

well as charges for intermediate maintenance of the work while not yet opened for

service and bears also charges for such subsequent additions and improvements as

may be sanctioned under rules by comptent authority. It may also bear charges on

account of restoration of damages caused by extraordinary casualties, such as flood,

fire, etc and such charges should be recorded under a separate head “Extraordinary

Replacements”.

(b) Revenue bears all charges for maintenance and working expenses which embrace

all expenditure for the working and upkeep of the project, as also for such renewals

and subsequent replacements, and such additions improvements or extensions, as it

may be considered desirable to charge to Revenue, instead of increasing the capital

cost of the undertaking.

(c) In the case of renewals and replacements of existing works, if the cost really

represents an increase in the capital value of the system and exceeds the cost of the

original work by Rs.1,000/- the cost of the new work should be divided between the

Capital and Revenue, the portion debited to the latter account being the cost of the

original work, which should be estimated if the actual cost is not known, and the

balance charged to capital. In other cases, the whole cost of the new work should be

charged to Revenue Thus a renewal which does not represent a substantial

improvement of the original work, but which is in all material essentials the same as

the latter, although it may exceed the cost of that work by more than Rs.1,000/-

should not be charged to Capital but to the Revenue account.

d) When the construction estimate of a project (commercial) is closed, the

expenditure on works of additions, extensions or improvements will be charged thus:-

(i) Estimates exceeding Rs.1,000/-, for (1) works which are in themselves directly

remunerative, such as new distributaries, mills or works for increasing the canal

229

discharges, and (2) works which are necessary for the full development of a project

but which are not in themselves directly remunerative, shall be charged to the Capital

account.

(ii) Estimates amounting to Rs.1,000 or under shall be charged to the Revenue

Account.

(iii)All estimates for works which neither are remunerative in themselves or

considered necessary for the development of the project shall be charged to the

Revenue account.
(e) Where outlay is of a nature which under these rules does not appertain to Capital,

it is not, under any circumstances and whatever its magnitude, to be charged to

Capital.

7. Works expenditure which, under the foregoing rule is chargeable to the Capital

account will be classified under the project which is treated as a minor head under the

major head “4701-Capital outlay on Major and Medium Irrigation” or “4801-

Capital outlay on Power Projects”. That which is chargeable to the Revenue

account will fall under the object head “Extensions and Improvements” or

“Maintenance and Repairs” of the division “Working Expenses” of the Major head

“2701-Major and Medium Irrigation”, according as the expenditure pertains to the

category of “Works” or “Repairs” as per prescribed classification.

8. The expenditure on productive works is recorded in two sections, separately for

capital and revenue charges. For Unproductive works also, the arrangement is similar

where it is desirable and possible to maintain accounts on a quasi-commercial basis.

When however, a work of this class, is too small to make it worthwhile to maintain a

separate account of it on such a basis, all expenditure on it is treated as a revenue

charges, the work being classified as non-commercial. In the category of

unproductive works, is also included “Miscellaneous expenditure” upon the

preliminary survey of new projects and also for the cost of famine surveys required

for the preparation of famine programmes.

STATEMENT – B

Detailed classification of Works Expenditure pertaining to Irrigation, Navigation,

Embankment and Drainage Works.

1. Works expenditure of Irrigation, etc. major head falls under one or others of the

major heads “Works”, “Extensions and Improvements”, and “Maintenance and

Repairs”. Each of these minor heads is divided into sub-heads (1) Head Works (2)

Main Canal and Branches (3) Distributaries (4) Drainage and Protective Works (5)

Water courses (for “Works only) (6) Special Tools and Plant (for “Works” only) and

(7) Losses on Stock. Under the minor head “Maintenance and Repairs” an eighth

head “Compensation”, may be opened. The detailed heads subordinate to these heads

are enumerated in Statement C.

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2. All works expenditure relating to Main Canal and Branches may be divided into

(1) Main line of a canal, (2) each of its branches separately that relating to

distributaries may be grouped for the distributaries belonging to the main line of the

canal and to each of its branches separately.

3. In connection with these sub-divisions, the following points should receive

special attention (a) When land is taken up for two or more of these sub-divisions at

the same time, its cost must be divided in the best way practicable (b) In the case of

Storage Projects all works connected with supply channels to feed the head reservoir

come under Head Works (c) Water-power installations at the head works of a canal,

head locks and head regulators of main and branch canals, fall under “Main Canal

and Branches”, (d) When a Canal or a distribution channel therefrom and a drainage

in connection with it, are planned simultaneously and the two works intersect, the

cost of the crossing should be charged to “Drainage and Protective Works” and (e)

Building required for the general purposes of a Canal system such as workshops,

headquarters, station, etc are chargeable to “Main Canal and Branches.”

4. For rules relating to Water-course, Special Tools and Plant and Losses on Stock,

see Appendix 3 and paragraph 7.1.4 and 7.2.37 respectively. The head “Watercourses”

is not necessary in the case of the minor head “Extensions and

Improvements” and “Maintenance and Repairs” The head ‘Losses and Stock’ is

intended for all general losses on stock which cannot be attributed to any work, the

accounts of which are open. The head special Tools and Plant is further sub-divided

into three detailed heads namely (i) Gross Expenditure (ii) Deduct recoveries (iii) Net

expenditure, the first of which is intended for collection of the aggregate cost of the

special Tools and Plant at one place and the second for the record of the recoveries on

account of special Tools and Plant which are taken in reduction of expenditure.

Statement C

Enumerating the detailed heads referred to in paragraph 1 of the Statement B and

detailing the works and services, the charges whereon are classified thereunder.

General Remarks – The detailed heads in this list may be varied under the orders of

the Local Administration to suit the circumstances of each project. Combined works

falling under two or more heads e.g., combined bridges and falls or combined falls

and regulators should be classified according as which aspect of the work

predominates.

A. Preliminary Expenses

Surveys and preliminary investigations – This head does not appear under “Extensions

and Improvements”, nor under “Maintenance and Repairs.”

B. Land

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Compensation for taking permanent or temporary possession of land required for the

purposes of the work.

The term “Compensation” includes the following, besides the payment for the land itself

– (1) payments for buildings, trees, crops, etc and (2) cost of special land acquisition

establishment when it is chargeable to the Public Works Department, vide paragraph

17.1.3. Sale proceeds of wood, building materials etc. obtained on cleaning of land

should be taken in reduction of the charge, if realized before the accounts of the estimate

for the acquisition of the land have been closed, vide paragraph 3 of Statement E. If any

buildings acquired with the land are used as residences or otherwise let out they should

be brought on the Register of Licence Fees of Buildings and Lands, Form CPWA 49, and

licence fees/rents realized should be treated as ordinary licence fees/rent receipts.

C. Works

All construction works, whether of earthwork or a masonry, etc, excluding works falling

under the head I – Navigation and K – Buildings in all cases and under L – Earthwork

where this is maintained as a separate detailed head. Ordinarily, the group head C –

Works takes the place of such of the heads, D,E,F, F(1), G,H,J and L as are not separately

provided for.

D. Regulators

Works (other than escapes and escape heads) for the regulation of supply.

E. Falls

Falls and rapids other than those required to maintain the depth of water for navigation

purposes.

F. River and Hill Torrent Works

Aqueducts, superpassages, culverts, siphons, inlets, outlets and cross drainage works

generally, when such works are in connection with river and hill torrents.

F.(1) Other Cross Drainage Works

Cross drainage works of the classes referred to under the head “F – River and Hill

Torrent Works” when such works are in connection with drainage other than that from

river and hill torrents.

G. Bridges
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Bridges, both road and railway, for crossing the canal, including subsidiary works, e.g.,

approach roads, fencing gates, ghats, steps, etc.

H. Escapes

Masonry and earthwork connected with escapes (including escape heads).

I. Navigation

Locks at head work and on the canal; separate navigation channels and weirs designed for

maintaining the requisite depth of water for navigation purposes.

J. Mills

Water power plant (if a permanent fixture) and buildings in connection with such plant,

also sluices and channels conducting water to and from the same.

K. Buildings

Permanent and temporary buildings (including staff quarters, offices workshops, stations,

etc., but excluding buildings for water power) and station drainages, roads, gardens

enclosure-walls, conservancy works, etc., pertaining to buildings individually or

collectively. In the case of maintenance and repairs, this head includes also taxes payable

by Government and rents and buildings hired by Government.

L. Earthwork

Excavation and embankments for the channels, and its side roads and service roads,

protective work for the bed and sides, trimming turfing or revetting slopes, retaining

walls for embankments.

L(1) Boundary and Service Roads

This head may be opened to record the expenditure on side roads and service roads

separately if it is not proposed to classify it under “L-Earthworks”.

M. Plantations
All regular plantations, including the cost of clearing land, transplanting soil and planting

trees. Gardening charges in connection with buildings do not fall under this head.

N. Tanks and Reservoirs

Earthwork, masonry, etc on tanks and reservoirs (e.g. tail tanks) in connection with

canals other than tanks chargeable to “Head Works” in the case of storage projects.

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O. Miscellaneous

Works and services not falling under any other detailed head. Includes (1) experiments;

(2) Works in connection with irrigation outlets not debitable to the head “Water-courses”;

(3) distant marks; (4) boundary pillars. Also Minor works constructed on the bank of

canals or distributaries for the direct delivery of water. Includes also in the case of

original works and of extensions and improvements, charges for compensation not

debitable to any other detailed head.

P. Maintenance

All repair works prior to the opening of the revenue account for the project or the section

concerned. This appears only under “Works”

STATEMENT D

Showing the detailed classification of the minor head “Establishment”.

This minor head is primarily divided as follows:-

Name of Sub-Division Remarks

I Chief Engineer

II. Special Officers

For Consulting Architect and other special officers whose

jurisdiction extends beyond a single circle of

superintendence or other unit prescribed for the pro rata

distribution of establishment charges. (Fees recovered from

outside bodies and other departments of the Union

Government for services rendered by this establishment are

taken in reduction of the charges under the sub-division)

III Superintending

Engineer

Includes also special officers, if any, not falling under subdivision

II

IV Executive

V Medical

Establishment charges of workshops for which capital

accounts are kept should be kept distinct from other charges,

and recoveries on account of work done in such workshops

(for outside bodies and other departments of the Union

Government should be taken in reduction of the charges).

VI Special Surveys Establishment; employed on large surveys for new

Irrigation, Navigation, Embankment or Drainage Projects.

VII Special Revenue Establishment employed entirely on the revenue

management of Irrigation, Navigation, Embankment and

Drainage Projects and on assessment, etc., of revenue;

includes also Plantation, Steemer and Water-Regulation

Establishment, etc. and charges debited by the Civil

Departments for collection, etc of revenue.

VIII Deduct Recoveries For credits of all kinds on account of (i) proceedings or (ii)

lumpsum recoveries for work done, but excluding (a) fees

for services rendered by special officers and (b) recoveries

for work done in workshops, when such credits are

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adjustable as reduction of expenditure in accordance with

the rules regulating the treatment of recoveries of

expenditure in the accounts of the Public Works

Department.

IX Lumpsum charges

creditable to other

Governments,

Departments etc

Debits of the major head on account of establishment

charges in cases in which such charges are not adjustable in

the accounts of any particular work.

X Pensionary Charges This Sub-division relates only to the major heads “2701”

and “4701”

2. The sub-division I to VII have, below them, the following heads, with such object

heads as may be prescribed locally:-

(a) Pay of Officers

(b) Pay of Establishment

(c) Allowances, Honoraria, etc

(d) Other Charges

(e) Deduct-Recoveries. For use only under Sub-division IV (Workshop

Section)

An additional head, “Bonus”, may be opened, where necessary, for bonus paid to
the eligible employees.

The Heads (b) and (c) include also the charges on account of Divisional

Accountants posted by the Pay and Accounts Officer.

Note:- The general principles regulating the classification and incidence of Pay,

Allowances, Leave Salaries, etc of Government servants are contained in Government

Accounting Rules 1990.

STATEMENT E

Treatment of recoveries of Expenditure in the accounts of the Public Works

Department.

1. The general directions for regulating the exhibition of recoveries of expenditure

in Government account are given in Chapter 5 of the Government Accounting

Rules 1990. The following paragraphs indicate their application to Public Works

transactions.

2. The general rule is that, subject to the provisions of Rule 54 of Government

Accounting Rules 1990, all recoveries of expenditure will be taken as reduction

under the concerned Service head irrespective of whether they relate to

overpayments pertaining to the current year or to any previous year.

3. As an exception to the general rule in paragraph 2 above, recoveries under stock

and other suspense account should be treated as reduction of gross expenditure.

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The recoveries of expenditure on work in progress comprising, inter-alia, sale

proceeds of surplus materials and plant acquired specially for any work or of

materials received from dismantled structures, may likewise be treated as

reduction of expenditure, irrespective of whether the estimates for the works

made allow for such recoveries or not. See also paragraph 22.2.9.
4. Subject to the provisions of Rule 5, recoveries on account of establishment and

tools and plant charges should be treated as follows:-

(i) Recoveries of establishment charges on percentage basis:- These recovedries,

in so far as they are effected from other departments of the Union Government,

should be adjusted by deduction from expenditure under the minor head

“Directions and Administration”. Recoveries on account of works carried out

on behalf of private parties or Local funds or other Governments, however,

should be treated as revenue receipts.

(ii) Recoveries of tools and plant charges on percentage basis:- Recoveries from

other Departments of the Union Government should be adjusted as reduction

of expenditure under the minor head “Tools & Plant”. All other recoveries

should be treated as revenue receipts under the major head concerned.

(iii) Pro-rata share of the charges for joint establishment and tools and plant:- The

pro-rata shares calculated at the end of the year should be treated as reduction

of expenditure under the minor head “Direction and Administration” and

“Tools and Plant” respectively of the major head to which the total charges

were debited in the first instance (see also Rule 5 of Appendix 4).

(iv) Recoveries on account of charges for leave and pensions:- When the

recoveries on account of establishment charges include, as a distinct and

separate factor, an element of the charges for leave and pensions, the portion

of the recoveries representing leave should be treated as revenue receipts under

the Public Works major head concerned. Recoveries on account of pensionary

contributions should in the case of ‘Civil Works’ be credited to “0071 –

Contributions and Recoveries towards Pension and Other Retirement Benefits”

while such recoveries in the case of the Irrigation Department should be

credited to the Irrigation Major head concerned as receipts or recoveries of

expenditure, accordingly as they relate to Revenue or Capital Major Head. In

cases, however, in which the rates for leave and pension contributions are

combined, the recoveries in the case of Civil Works, should be taken to “0071

– Contributions and Recoveries towards Pension and Other Retirement

Benefits”, while such recoveries in the case of Irrigation Department should be

credited to the Irrigation Major heads concerned as revenue receipts.

5. Notwithstanding anything contained in these rules, receipts and recoveries on

Capital Account in so far as they represent recoveries on expenditure previously

debited to a capital major head, should be taken in reduction of expenditure under the

major head concerned. For convenience of accounting they should be treated as

revenue receipts in the first instance and booked as “Receipts and Recoveries on

Capital Account.” At the end of the month they should be deducted from the account

of the division or sub-division of the major head concerned in a lumpsum.

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6. The recoveries of expenditure which are finally creditable as revenue receipts,

should be recorded under the minor head “Recovery of Percentage charges” of the

major head “0059” or “0071” as the case may be, while those which are adjustable in

reduction of expenditure under the capital major head, should be posted as “Deduct –

Establishment charges transferred pro rata to other capital Major Heads” under the

minor head “Direction and Administration” of the capital major head concerned.

Note - Receipts on account of sale proceeds of land, buildings, special tools and plant

or other assets purchased or constructed as the cost of special project may be at the

discretion of the Government be taken in reduction of expenditure under the

appropriate sub-heads subordinate to the capital major head concerned.

7. Recoveries on account of cost of audit and accounts:- These recoveries, when

they are made in connection with work done for Railways, Defence Services, Postal or

Telecommunication Department should be treated as reduction of expenditure under

“2016 – Audit”. In the case of work done for non-Government bodies or individuals,

such recoveries should be adjusted as receipts under the minor head “Fees for

Government Audit” subordinates to the major head “0075 – Miscellaneous

Administrative Services.”

Note – If under the Note below Rule 7 of Appendix 4, the per percentage charges for

work done in workshops of a quasi commercial character for other Divisions and

departments both under the Union Government and other Governments, include

recoveries in respect of audit and accounts charges; such recoveries should not be

credited to “2016 – Audit” or “0075 – Miscellaneous Administration Services – Fees

for Government Audit”, except in the case of works covered by this rule.

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APPENDIX 3

(See paragraph 16.4.6)

ACCOUNTS RULES RELATING TO WATER COURSES

1. As a general rule, water-courses of irrigation, etc projects are not constructed by

Government as integral parts of the projects, the liability of Government being confined

to the provision of the main canal and of such branches and major and minor

distributaries as may be decided upon by competent authority from time to time.

Accordingly persons desiring to use the water of a canal are required either to make their

own arrangements for the construction of the necessary water courses or to bear the

charges that may be incurred by the Department in constructing them on their behalf.

This liability of the cultivators or other persons benefiting by canal irrigation extends also
to works of improvements and repairs to water courses and to construction and repair of

bridges, culverts or other works that may be required for the passage of the water of such

water courses across any public road, drainage channel etc. In the general interest of the

cultivators, especially when a canal project, or an integral part of it, is launched in a new

locality and it is desired to afford special facilities to the cultivators with a view to the

more rapid development of irrigation, it may some times be decided by Government to

lay out and construct, at the cost of Government in the first instance, the entire system of

the main water-courses required for a project or a substantial section of it, at the outset.

When this course is adopted, a scheme is simultaneously devised for effecting recovery,

in a number of years, of the additional burden thus thrown on Government finances. As

no separate account can be kept satisfactorily of the liabilities of each individual person

benefitted, usually the recovery takes the form of a general enhancement of the water

rates or the imposition of a special acreage rate. The amount which is usually sought,

under such a scheme, to recover in the aggregate is the initial capital cost of the works

(including such cost of maintenance during construction as may be charged to the capital

account) plus the usual percentage charges finally in Appendix 4, plus the interest

calculated at a rate fixed by Government. In some cases, where an entire system of

water-courses is constructed by Government, it may in the particular circumstances of the

tract, be decided by Government, that the whole or a portion of the cost of construction

be charged finally to the account of the project concerned, or the charge on account of

interest waived.

2. Works outlay on water-courses, which may be incurred by Public Works Officers,

will thus fall under the following distinct categories:-

I – Recoverable from individual cultivators concerned in lump sums equivalent to the

charges incurred on behalf of each

II - Recoverable by a general levy, whether for a specified or indefinite period –

(a) When the actual recoveries are required to be set off against the outlay

(b) When the actual recoveries are not to be set off against the outlay

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III. Borne finally by Government

Works of the first class are styled “Takavi Works” and the account rules relating to them

are given in Chapter 16. This appendix deals only with works of the other two classes.

3. In respect of sanctions to estimates, etc, all works in connection with watercourses

are treated like other works of the irrigation, etc., project concerned, the

expenditure being booked finally under the appropriate detailed head subordinate to the

head “Water-courses”. After a work has been constructed, the cost of maintenance and

repairs is, in all cases, borne by the cultivators concerned.

4. Recoveries actually made under clause II of paragraph 2 should be shown in the

account:-

(a) as receipts on the capital account of the project, if the levy takes the form of a

lumpsum recovery of cost in one or more years or

(b) as revenue receipts of the projects, if the levy takes the form of an enhancement of

revenue, the exact classification being determined by the form in which the

recoveries are made.

Note - Recovery of outlay on water-courses where such recoveries have to be set off

against the outlay, may at the discretion of Government, be taken in reduction of

expenditure under the sub-head, “water-courses.”

5. In cases falling under clause II (a) of paragraph 2, the Accounts Officer, with a

view to watch the progress of the recoveries, may be required to maintain a suitable

proforms account without disturbing the booked accounts of receipts and expenditure, the
form of account being determined in consultation with the Administrative

Ministry/Administrator concerned. It will ordinarily be found sufficient to keep an

account merely in respect of the works outlay, the annual recoveries being distributed

rateably, as between works, interest, etc on a fixed basis determined once for all.

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APPENDIX 4

Rules for the distribution of Establishment and tools and Plant Charges

1. Charges on account of general services like Establishment and ordinary Tools and

Plant of a division or office should be classified in the accounts under the appropriate

sub-head under the minor heads “Direction and Administration” and “Machinery and

Equipment” as the case may be, of the major head “2059 Public Works” and, save as

herein after provided, no attempt should ordinarily be made to include in the cost of an

individual work (or head of account) any portion of expenditure on account of those

services (see also paragraph 10.1.5)

Note – For the classification of the charges for tools and plant of a special office, see

paragraph 20.3.7.

2. As an exception to the foregoing rule, the under-mentioned special establishments

should be charged as indicated below:-

(i) Work-charged establishment including Work-charged staff converted into

regular Establishment as defined in paragraph 10 of the Central Public Works

Department Code to the account of the work or subwork concerned.

(ii) Purely revenue establishment (zilladars, Amins, etc) employed entirely on the

management of irrigation, etc., works and on the assessment etc of connected

revenue to the sub-division “Working Expenses” of the major head “2701 –

Major and Medium Irrigation etc.” works (Commercial) or (Noncommercial),

as the case may be.

(iii) Establishment employed for temporary period on famine relief works, to the

minor head concerned under the major head “2245” Relief on account of

Natural Calamities.”

(iv) Establishment employed in workshops of a quasi-commercial character; to the

account of the workshop concerned.

3. The cost of special tools and plant i.e., tools, plant, machinery, etc., obtained to

meet the special requirements of a particular work or project and of a nature not usually

to be found in the general stores of the Administration should be treated as a direct charge

to the work or project.

Similarly tools, plant and machinery required for a workshop of a quasicommercial

character should be charged direct to its accounts.

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Note 1 – In case of doubt, the Chief Engineer, or other competent executive authority,

will decide whether any item of tools and plant should be classified as ordinary or

special.

Note 2 – The cost of tools and plant required for use on Famine Relief should be treated

as “special” and classified in accordance with rule 3 above.

4. Detailed procedure for distribution of establishment, tools and plant etc., in

respect of common Public Works Establishments.

(a) Establishment

(i) The “gross expenditure” on the common establishments, of PWD Buildings and

Road Branch, will be recorded under the Minor Head “Direction and Administration”

below “2059 – Public Works”. The Minor Head will have suitable sub-heads such as

“Direction”, “Designs”, “Supervision”, “Execution”, ‘Architecture”, “Stores Control”,

etc. From this ‘gross expenditure’, the distribution of the charges will be in two stages as

explained below:-

(ii) The first stage of distribution will be in respect of establishment charges relatable

to Capital Major Heads. The distribution of establishment charges from the omnibus

Public Works major head to these heads will be calculated on percentage basis, as per the

existing principles in CPWA Code; the percentages being carefully determined by the

Government in such manner as to remain current for at least 3 years so as to avoid

meticulous and frequent recalculations.

In respect of establishment charges relatable to works done for other Governments, Local

funds, private parties etc, recoveries will be made on percentage basis to be determined

by Government and credited to the Major Head “0059 – Public Works – Other Receipts”,

as revenue.

The debit for the proportionate charges on Establishment apportioned to the Capital

Major Heads will be adjusted under the sub-head “Buildings” under the appropriate

Programme Minor Heads, against a distinct detailed head (or object classifications)

“Establishment” to be opened for the purpose. The contra credit (Minus debit) under

“2059 – Public Works” will be booked under a distinct sub-head – “Deduct –

Establishment charges transferred on percentage basis to Capital Major Heads” below

“Direction and Administration”. Such adjustments may be done monthly in the Public

Works Divisional Accounts.

(iii) The next stage of distribution of the establishment charges under “Direction and

Administration” below “2059 – Public Works”, will be in respect of the works charged to

the major heads “2216 – Housing” and “3054 – Roads and Bridges” only. Distribution of

the charges in respect of works charged to other major heads in the Revenue Section is

not necessary. For this purpose, from the residuary expenditure under “Direction and
Administration” at the end of the year arrived at after the adjustment at (a) above is

carried out, the amounts recovered during the year from other Governments, Local bodies

241

etc. on percentage basis for works done on their behalf and credited to Public Works as

revenue will be notionally deducted to arrive at the net charges on Establishment relating

to Public Works (Construction) in the “Revenue Section”. From this net amount, a prorata

distribution of the charges to “2216 – Housing” and “3054 – Roads and Bridges”

will be made according to works outlay recorded under these major heads vis-à-vis the

total revenue expenditure on Public Works (Construction) in all Major Heads in the

Revenue Section. The distributable amounts so calculated will be adjusted from “2059-

Public Works”, through a deduct Sub-head “Establishment Charges” transferred pro-rata

to “Housing”/”Roads and Bridges”, by per contra debit to “2216 Housing Direction and

Administration”, and ‘3054 – Roads and Bridges Direction and Administration’,

respectively. The adjustment will be carried out by the Accounts Officer at the end of the

year.

(b) Tools and Plant

The Procedure outlined above will be followed mutatis mutandis for distribution of

“Tools and Plant” charges also.

The percentage should be levied separately for establishment and tools and plant.

Note 1 – The basis for determining the slab for levying the establishment charges shall be

the estimated cost of a work, though the actual adjustment of percentage charges should

be made on the expenditure incurred during the year.

Note 2 – Departmental Charges, including pensionary and audit charges should be levied

on all works, the cost of which is met from the detailed head “Grrants-in-aid” under the

relevant programme minor head under the Major Head “2059 – Public Works”.
(c) For works executed by the Central PWD the percentage rates for establishment are

intended to correspond as far as possible to the average percentage borne by the Public

Works Department normal works programme which fully occupy such establishment.

The rates fixed with effect from 1984-85 are as per the Annexure.

(d) For other works, Administrative Ministry/Administrator concerned are authorized to

fix the percentage rates in consultation with the Accounts Officer, on condition that the

percentages so fixed are not less than the actual average cost per Rs.100 of outlay on

works in the Administrative Ministry/Administration concerned during the previous five

years.

Note 1 – When only some of the operations necessary to the completion of a non-

Government project are undertaken at one time different percentages may, if desired, be

adopted for each operation, provided that if subsequently the remaining operations are

undertaken, the aggregate recovery is equal to the full charge leviable under this rule.

242

Note 2 – Similarly, different rates of charges may, if desired, be prescribed for large and

small works or for scattered and approximately the same aggregate return to Government

as if a uniform rate, as determined under this rule, will give.

(e) The percentage fixed as above should be examined and readjusted, if necessary, once

in every three years after consultation with the Accounts Officer.

(f) In calculating departmental charges in respect of works executed on behalf of

Central & Commercial concerns (including the Ministry of Defence), other Government

and non-Government bodies or individuals, one percent should be added on account of

pensionary contributions.

(g) An additional charge of one percent, should be recovered in respect of works done

for Railways, Defence Services, Postal or Telecom Department, All India Radio (except
monitoring service), from 1.4.54, Department of Overseas Communication Service from

13.11.1947 and non-Government bodies or individuals to cover the cost of audit and

accounts establishment.

Note 1 – No share of general charges on account of establishment and tools and plant

should be included in the actual cost of works chargeable against the Central Road Fund.

Note 2 – Conseuqent on the decision to treat the Defence Accounts Department as Civil

Department w.e.f. 1971-72, that Department should not charge an additional charge of

one percent to cover the cost of Audit and Accounts of works (executed by MES) on

behalf of the Civil. Similarly, in respect of Defence Works carried out by Civil, the

Accounts Officer (concerned) should not charge the Defence Accounts Department for

any services rendered in keeping the Accounts of Works, (executed by civil) on behalf of

Defence.

5. The prescribed percentages may be remitted by the Administrative

Ministry/Administrator concerned in the case of non-Government works costing less than

Rs.1,000 Remission of charges is not permissible in other cases, as such aid as it may be

desired to give to local body in the construction of a work in which Government is

interested, should take the form of a cash grants-in-aid.

Note – In the case of works costing Rs.1000 and over, the Administrative

Ministry/Administrator concerned are authorized to sanction a cash contribution in favour

of a local body upto the actual amount of establishment and tools and plant etc., charges

leviable under Rule 4 (see paragraph 16.1.3). This power cannot be exercised in respect

of works executed on behalf of a private individual.

6. For works done in workshops which are of a quasi-commercial character,

percentage charges should be levied in all cases, i.e., even when work is done for

P.W.Divisions of the same Administration. The rates may be fixed by the Administrative
Ministry/Administrator concerned in consultation with the Accounts Officer. See

paragraph 14.2.5 of this Code.

243

Note – The percentage charges referred to in this rule may be so regulated as to include

prescribed percentage charges for audit and accounts even in the case of jobs executed for

other divisions and departments both under Union Government and other Governments.

7. The percentage referred to in rule 4 are leviable on the actual outlay booked in the

accounts i.e., on the net outlay where there are any refunds or writes back. No item of

expenditure should be excluded from the levy on the plea that it involves little or no

departmental supervision, etc, but the prescribed percentage charges for tools and plant

should not be levied in the case of non-Government works on which tools and plant of

the department are not used.

Note – Under this rule, even the cost of land acquired through the district and revenue

authorities is not exempt when it is adjusted in the divisional accounts as part of the cost

of a non-Government work; but if it is not included in the estimate for the work and is not

passed through the Public Works accounts, no percentage charge is leviable on account of

it.

8. Recoveries made in accordance with the preceding rules should be classified as

indicated in Statement E of Appendix 2, the adjustment being made once a year in

March, except in the cases of Deposit Works (see paragraph 16.2.4). Local Loan Works,

Takavi Works and works done occasionally for other departments, Governments, etc.

Where the percentage leviable are required to be adjusted whenever the cost of work

done is adjusted by charge to the deposit, remittance or other account concerned. In the

case of Capital Works the adjustment may be done monthly vide rule 4(a) (ii).

9. In the case of workshops of a quasi-commercial character, any other work, for

which special establishment is entertained, an addition of such percentage, limited to 5

percent of the cost of this establishment, as may be fixed by the Administrative

Ministry/Administrator concerned on a consideration of the special features of each case,

may be made to cover supervision charges thereon.

10. For allotment of funds, it is not necessary, to include in the estimates for

individual works, any provision on account of establishment and tools and plant charges,

unless percentage charges levied by other Governments or departments are, under the

rules, included in the cost of work. See also paragraph 10.1.5 of this Code. For

administrative purposes, such provision is made in the project estimates of works of

which it is desirable to forecast the ultimate financial results.

11. The cost of special tools and plant (such as cranes, etc) debited to a single head in

the accounts may be distributed over the several sub-heads of works in accordance with

such methods as the Administrative Ministry/Administrator concerned may determine in

consultation with the Accounts Officer. Similarly, if the cost of depreciated value of any

special tools and plant obtained for, or used on a project is required to be distributed over

different units of the project, the forms of subsidiary accounts to be kept to facilitate that

244

distribution will be settled by the Administrative Ministry/Administrator concerned after

consultation with the Accounts Officer.

STATEMENT SHOWING THE RATES OF DEPARTMENTAL CHARGES

LEVIABLE ON CPWD WORKS EFFECTIVE FROM 1.6.84 AND THEIR

BREAK-UP

Objectives of Work All

Maintenance

works and
minor works

costing upto

Rs.one lakh

Construction

works costing

upto Rs. two

crores

Construction

works costing

between

Rs.two and

five crores

Construction

works costing

more than

Rs.five crores

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

(A) Establishment

Charges

1. Preparation of

preliminary sketches

2. Preparation of detailed

working drawings

3. Preparation of

preliminary estimates
4. Preparation of detailed

Estimates

5. Preparation of

structural designs

6. Execution

Total

(B) T&P (Machinery

Equipment)

(C) Audit and Account

(D) Pensionery

½%

1%

¼%

½%

1%

19 ¼%

22 ½ %

¾%

¼%

¼%

¼%

¾%

¼%

¾%

1%
7 ¾%

10 ¾%

¾%

¼%

¼%

¼%

½%

¼%

½%

¾%

4 ¾%

7%

½%

¼%

¼%

¼%

¼%

¼%

¼%

¾%

4 ¼%

6%

½%

¼%

¼%
23 ¾% 12% 8% 7%

245

Notes:

1. In the case of works for CGHS where architectural services are provided

by Central Design Bureau of CGHS necessary rebate @ 1% has to be

given in Estt.Charges

2. The indicated rates of tools and plants are exclusive of the cost of special

tools and plant, the cost of which will be charged to the estimate for the

work.

3. The DDA will be allowed a rebate in the departmental charges on account

of preparation of preliminary sketches, and detailed architectural drawings

relating to their works as per the figures given in the break up of

departmental charges.

4. No D.C. for Government works and those of autonomous bodies fully

funded by Central Government are Preliminary Estimates

(i) This comes into force with effect from 27.9.2001

(ii) The levy of D.C. on current works including those to be sanctioned

will be governed as per provision in the sanctioned estimate.

(iii) It should be ascertained whether an Autonomous Body is fully

funded or not by Central Government by obtaining a letter from

the head of such an undertaking or from the head of finance

department of the Undertaking that it is fully funded by the

Government.

246

Appendix-5 Not Printed

247

APPENDIX 6

(See Note below paragraph 13.2.1)

Rules for the adjustment of transactions connected with stores obtained through High

Commission/Embassies abroad.

1. When the stores arrive, the ““Minor head-129-Material Purchase Settlement

Suspense Account” below “Major Head-8658-Suspense Accounts” should be credited

in the manner prescribed in paragraph 13.2.1 and the accounts of the works concerned or

Stock should be debited, with the cost of the quantities actually received, the amount

being determined by converting the invoiced sterling value into rupees at the composite

rate of exchange (as fixed by the Ministry of Finance from time to time) for the month in

which the payment was made in High Commission/Embassies abroad.

Note - If the month of payment is not known, the composite rate of exchange for the

month in which the stores were dispatched from High Commission/Embassies abroad

should be adopted provisionally, subject to adjustment on receipt of the debit for

payment.

2. When the debit for the payment for stores made in High Commission/Embassies

abroad which will be calculated in rupees at the composite rate of exchange for the month

of payments, is received from the Accounts Officer the Head “MPSSA” should be

debited and the head “Public Works Remittances” credited (see note below paragraph

13.2.4).

3. In case the debit for the payments made in High Commission/Embassies abroad is

received before the arrival of the stores the Suspense heads within the accounts of work

concerned or Stock viz., “Contractors – Other Transactions/Advance Payments” should

be operated upon, suitable arrangements being made to watch the receipt of stores
4. Indian charges (e.g., balance of sea freight and carriage and incidental charges)

should be debited direct to Stock or works concerned, unless incurred prior to the arrival

of the stores in the division, in which case they should be kept under suspense within the

accounts of the work or stock (Rule 3), and on receipt of the stores, the debit should be

transferred to the relevant sub-head of work or stock, when making the adjustment of

cost, as laid down in Rule 1.

5. A surcharge at the rate fixed by Government from time to time, to cover

departmental expenses and marine insurance, is added by the High Commissioner for

India to the invoiced price (including freight) on all stores obtained from abroad through

its Supply Wing by State Government, Commercial Departments, including Irrigation

Works, Government Commercial Undertakings, Local Funds, private individuals, etc. in

calculating the cost debitable to or recoverable from the various sources.

248

Note 1 - When under special arrangements, the contractor undertakes to deliver stores at

an Indian Port and not at the Stores Offices abroad the surcharge leviable will be only for

departmental charges.

Note 2 - The extra charge for marine insurance covers the risk and losses during the

voyage to India and not losses between the ship’s side and the shore.

Note 3 - The adjustment of the surcharge is made by the Indian Embassy. A similar

extra charge should be made in India for Stores imported from abroad for the Union

Government, but eventually transferred to State Governments etc. In such cases, the

amount of the surcharge should be credited under the minor head “Other Receipts” below

the relevant functional major head on imported stores.

Note 4 - In making recoveries from the agents of vessels on account of short delivery

of stores, the surcharge should not be added to the involved value of the stores (including
freight).

6. The balances representing the value of stores received, for which no debits for

payments made abroad have come to hand, should be watched with a view to early

clearance, special reference being made at once to the Accounts Officer in such cases.

7. Balances due to short deliveries, etc which cannot be cleared by recovery of cost,

are not adjustable, until their write off has been sanctioned by competent authority.

8. The transactions relating to stores procured abroad should be recorded in Form

CPWA 67 Suspense Register under two classes of purchases mentioned in paragraph

13.2.6.

9. Indents on the Supply Wing of the Indian Embassies abroad should indicate the

detailed classification of the charge.

249

APPENDIX 7-A

(See paragraph 17.2.1)

Detailed procedure to be followed by Public Works Divisional Officers for the settlement

of inter-divisional transactions by Cheque/Bank Draft.

1. Pursuant to the dispensation of the operation of minor head “107 – Cash

Settlement Suspense Account” below the Major Head “8658 – Suspense Accounts” for

the settlement of inter-divisional transactions in Public Works Divisions w.e.f. 1.4.1993,

a new procedure for “Advance Payment” as enumerated below has been introduced.

2. According to the new procedure applicable in the case of inter-divisional

transactions whether on account of stores supplied, services rendered or works executed,

Indenting Division after obtaining proforma invoice for supply of stores etc. will make

“Advance Payment” by Debit to Sub-head “Stores/Service Advance” under the Minor

Head “799 – Suspense” below the functional Revenue or Capital Major/Sub-Major Heads
concerned per contra credit to Sub-Head “Public Works Cheques” under the minor head

“102 – Public Works Remittances” below the Major Head “8782 – Cash Remittances and

adjustments between officers rendering accounts to the same Accounts Officer.” Such

payments made to other Divisions should not be mixed with the advance payments to

contractors/suppliers.

3. Supplying Division on receipt of the above cheque will make necessary entries in

the Cash Book and remit the cheque to Bank for clearance. Entries in the Books of

Supplying Division will appear as Minus Debit to sub-head “Stores supplied/Services

rendered” under the minor head “799 – Suspense” below the functional Major/Sub-Major

Heads of Account concerned per contra Debit to Major/Minor/Sub-head “8782 - Cash

Remittances etc – 102 – Public Works Remittances – Remittances into Bank.”

4. After actual delivery of stores or rendition of services, Supplying Division will

debit Sub-Head “Stores supplied or Services rendered” under the minor head “799 –

Suspense” below the functional Major/Sub-Major head concerned by credit (i.e., minus

Debit) to Sub-head “Stock” under the minor head “799 Suspense” below the functional

Major/Sub-Major head concerned. Excess Debit, if any, will be refunded to the Indenting

Division before the close of financial year.

5. The invoice-cum-bill received from the Supplying Division, should be adjusted in

the same month by the Indenting Division debiting the value of the Bill to “Stock” with a

corresponding minus Debit to Sub-Head “Store/Service Advance” under the head of

account to which the same stands debited originally.

6. The above procedure will be followed mutatis mutandis in the case of “Works

Advance.”

A. Adjustment of Payment Scroll in the Books of the PAO of the Indenting Division.

250
7. On receipt of Payment Scroll together with paid cheque from Focal Point Branch

of the accredited Bank, PAO of the Indenting Division will verify the correctness of the

scroll and enter the amount, if found correct, in Payments Column (2) of Form CAM -17

– Register of P.S.B. Suspense. Thereafter PAO will pass an entry in his Accounts by

affording (-) Credit to Sub-head “Public Works Cheques” under the minor head “102 –

Public Works Remittances” below the Major Head “8782 – Cash Remittances etc.” per

contra credit to minor head “108 – Public Sector Bank Suspense” below the Major Head

“8658 – Suspense Accounts.” Minus Credit to Sub-head “Public Works Cheques” in the

books of the PAO of the Division would clear the original credit entry under this Subhead

appearing in the books of Divisional Officer which was made at the time of the

issue of the said cheque.

B. Action in the Divisional office of the Indenting Division.

On receipt of the copy of Payment Scroll without paid cheque from the dealing

branch of the accredited Bank, the Divisional officer of the Indenting Division will note

the amount in Part II – Cheques issued and paid of the “Schedule of monthly

reconciliation of Cheques and Remittances” in “Form 51” to be sent alongwith the

Monthly Account to the PAO of his Division who will verify and reconcile with the

booking of this amount in his Account.

C. Clearance of minor head “108 – Public Sector Bank Suspense” by the Principal

Accounts Office on receipt of “Payment Put Through Statement” from Reserve Bank of

India.

On receipt of PAO wise “Payment Put Through Statement” from Reserve Bank of

India, Principal Accounts Officer of the Ministry of Urban Development and Poverty

Alleviation will prepare the following Transfer Entry in Form CAM 34 to clear the minor

head “108 – Public Sector Bank Suspense.”

(-) Credit Major Head “8658 – Suspense Accounts:”

Minor Head “108 – Public Sector Bank Suspense”

To

Major Head: “8675 – Deposits with Reserve Bank”

Minor Head: “101 – Central (Civil)”

Sub-Head: “Reserve Bank (PSB) Credit

After preparing the above T.E., Principal Accounts Officer will intimate the PAO

of the concerned (in the instant case – Indenting) Division for keeping a suitable Note

against this minor head appearing in his Books.

D. Adjustment of Receipt Scroll in the Books of the PAO of the Supplying Division.

251

8. On receipt of Receipt Scroll together with challan from Focal Point Branch of the

accredited Bank, PAO of the Supplying Division will verify the correctness of the Scroll

and enter the amount, if found correct, in Receipts Column (3) of Form CAM 17 –

Register of P.S.B. Suspense.

Thereafter, PAO will pass an entry in his Accounts by Debiting minor head 108 –

Public Sector Bank Suspense” below the Major Head “8658 – Suspense Accounts” per

Contra (-) Debit to Sub-head “Remittances into Bank” under the minor head ‘102 –

Public Works Remittances” below the Major Head “8782 – Cash Remittances etc.”

Minus Debit to Sub-head “Remittances into Bank” in the books of the PAO of the

Supplying Division would clear the original Debit entry under this Sub-head appearing in

the books of the Divisional Officer of the Supplying Division which was made at the time

of remitting the cheque to Bank for clearance.

E. Action in the Divisional office of the Supplying Division.

On receipt of the copy of Receipt Scroll without supporting challan from the
dealing branch of the accredited Bank, the Divisional Officer of the Supplying Division

will note the amount in Part I – Cash remitted and acknowledged” of the Schedule of

monthly reconciliation of Cheques and Remittances” in Form 51 to be sent along with the

Monthly Account to the PAO of his Division who will verify and reconcile with the

booking of this amount in his Accounts.

F. Clearance of minor head “108 – Public Sector Bank Suspense” by the Principal

Accounts Office on receipt of PAO wise “Receipt Put Through Statement” from Reserve

Bank of India.

On receipt of PAO wise “Receipt Put Through Statement” from Reserve Bank of

India, Principal Accounts Officer of the Ministry of Urban Development and Poverty

Alleviation will prepare the following Transfer Entry in Form CAM – 34 to clear the

minor head “108 – Public Sector Bank Suspense.”

Debit Major Head: “8675 – Deposits with Reserve Bank”

Minor Head: “101 – Central (Civil)”

Sub-Head Reserve Bank (PSB)

To

Major Head: “8658 – Suspense Accounts” (-)Debit

Minor Head: “108 – Public Sector Bank Suspense”

After preparing the above T.E., Principal Accounts Officer will intimate the PAO

of the concerned (in the instant case – Supplying) Division for keeping a suitable Note

against this minor head appearing in his Accounts.

8. Since “Advance Payment” contemplated in the above procedure will have no

separate Budget Provision, it should be ensured by the Divisions concerned that such

transactions are settled within the same financial year.

252
Note 1: However, for the clearance of old outstanding Debit balances, minor head

“107 – Cash Settlement Suspense Account” below the Major Head “8658 – Suspense

Accounts” will remain in operation in Public Works Divisions till all the balances

thereunder are liquidated.

Note 2: Minor Head “107 – Cash Settlement Suspense Account” below the Major

Head “8658 – Suspense Accounts” below the Major Head “8658 – Suspense Accounts”

will now be operated by Public Works Divisions including PAO of the Division for the

settlement of inter-departmental transactions with Cabinet Secretariat and Ministry of

Defence. The accounting procedure for the settlement of inter-departmental transactions

with Cabinet Secretariat and Ministry of Defence is laid down in Appendix 7-C of

CPWA Code.

Indicative Example explaining accounting adjustments in the case of Inter-Divisional

Settlement by exchange of Cheque/Demand Draft.

Example: Division “A” of CPWD issued a cheque amounting to Rs.15,000/- to Central

Stores Division, New Delhi towards the cost of 100 bags of cement @ Rs.150/- per bag

in the month of June 2005 for Stock purposes in the Revenue Major/Sub-Major Heads

“2059 – Public Works – 80 General.” Central Stores Division (CSD-I) issued the

requisite quantity of cement to Division “A” in the month of June 2005 itself as per the

indent placed by Division “A”. Enumerate the entries step by step in the books of

Division ‘A’ and the “Central Stores Division” of CPWD.

Solution:

1. When Division “A” of CPWD makes “Advance Payment” to Central Stores

Division towards the procurement of 100 bags of cement @ Rs.150/- per bag. The

following entries will appear in its books.

Debit Major-Head: 2059 – Public Works

Rs.15,000/- Sub-Major Head: 80 – General

Minor Head: 799 – Suspense

Sub-Head: Stores Advance (x)

To

Major-Head: 8782 – Cash Remittances etc

Minor-Head: 102 – Public Works Remittances

Sub-Head: Public Works Cheques (*) CreditRs.15,000/-

(To be drawn in favour of the Divisional Officer of Central

Stores Division)

2. Action in Supplying Division i.e., Central Stores Division on receipt of cheque

Central Stores Division will make necessary entries in the Cash Book and remit the

cheque to Bank for clearance.

253

Entries in the books of Central Stores Division(I) will appear as under:-

Debit Major-Head: 8782 – Cash Remittances etc

Rs.15,000/- Minor-Head: 102 – Public Works Remittances

(***) Sub-Head: Remittances into Bank

To

Major Head: 2059 – Public Works

Sub-Major Head: 80-General

Minor Head: 799 – Suspense

Sub-Head Stores Supplied (xx) (-)Debit Rs.15,000/-

3. After actual delivery of Stores to Division “A”, the Central Stores Division (CSDI)

will carry out the following entries to credit its Stock.

Debit Major Head: 2059 – Public Works

Rs.15,000/- Sub-Major Head: 80-General

Minor Head: 799 – Suspense

Sub-Head: Stores Supplied (xx)

To

Major Head: 2059 – Public Works

Sub-Major Head: 80 – General

Minor Head: 799 – Suspense

Sub-Head: Stock (xxx) Credit, i.e.,

(-) Debit Rs.15,000/-

4. On receipt of Stock and verification thereof Division “A” will account for the

Stock in its books as follows:-

Debit Major Head: 2059 – Public Works

Rs.15,000/- Sub-Major Head: 80-General

Minor Head: 799 – Suspense

Sub-Head: Stock(xxx)

To

Major Head: 2059 – Public Works

Sub-Major Head: 80 – General

Minor Head: 799 – Suspense

Sub-Head: Stores Advance (x) (-) Debit

Rs.15,000/-

From the above entries it could be seen that Debit to Sub-Head “Stores Advance”

appearing at (x) at Sl.No.1 gets cleared by minus Debit to Sub-Head “Stores Advance”

appearing at (x) at Sl.No.4.

254
Similarly minus Debit to Sub-Head “Stores Supplied” appearing at (xx) of

Sl.No.2 gets cleared by Debit to Sub-Head “Stores Supplied” at (xx) at Sl.No.3.

Stock amounting to Rs.15,000/- reduced by Credit in the books of Central Stores

Division – I appearing at (xxx) at Sl.No.3 matches with Debit to Stock appearing at (xxx)

at Sl.No.4 above.

5. In so far as the clearance of Sub-Heads “Public Works Cheques” appearing in the

books of Division”A” and “Remittances into Bank” appearing in the books of Central

Stores Division I is concerned, the same will be cleared by their respective PAOs on

receipt of Payment Scroll and Receipt Scroll respectively.

6. Adjustment of Payment Scroll together with Paid Cheque received from Focal

Point Branch of the accredited Bank by the PAO of Division “A”

(-) Credit Major Head “8782 – Cash Remittances”

Rs.15,000/-(*) and adjustments between officers rendering accounts to

the same Accounts Officer

Minor Head: 102 – Public Works Remittances

Sub-Head: Public Works Cheques

To

Major Head: 8658 – Suspense Accounts

Minor Head: 108 – Public Sector Bank Suspense

Credit

(**) Rs15,000/-

7. Action by the Divisional Officer of Division “A” on receipt of the copy of

the Payment Scroll (without supporting Paid Cheque) from the dealing branch of the

accredited Bank. Divisional Officer of Division “A” will note the encashment of

cheque in Part II - Cheques issued and paid of the Schedule of monthly reconciliation
of Cheques and Remittances” in Form 51 to be sent alongwith Monthly Account to

PAO of Division “A” for reconciliation purposes.

8. Clearance of minor head “108 – Public Sector Bank Suspense” below the Major

Head “8658 – Suspense Accounts” by the Principal Accounts Office.

On receipt of PAO wise “Payment Put Through Statement” from Reserve Bank of

India, Principal Accounts Office will prepare the following Transfer Entry in Form

CAM-34 to clear the credit lying under the minor head “108 – PSB Suspense.

(-) Credit Major Head: “8658 – Suspense Accounts”

Rs.15,000/- Minor Head: 108 – Public Sector Bank Suspense

(**)

To

255

Major Head: 8675 – Deposits with Reserve Bank

Minor Head: 101 – Central (Civil)

Sub-Head: Reserve Bank (PSB)

Credit

Rs.15,000/-

This T.E. will be incorporated in the Monthly Account and PAO of Division “A” will

be intimated about the clearance of minor head “108 – Public Sector Bank Suspense”

to keep suitable Note against the original entry in his books.

9. Adjustment of Receipt Scroll together with Receipt challan received from Focal

Point Branch of the accredited Bank by the PAO of Central Stores Division I

Debit Major Head: “8658 – Suspense Accounts”

Rs.15,000/- Minor Head: 108 – Public Sector Bank Suspense

(****) To
Major Head: 8782 – Cash Remittances and adjustments

between officers rendering accounts to the same Accounts

Officer

Minor Head: 102 – Public Works Remittances

Sub-Head: Remittances into Bank

(-) Debit

Rs.15,000/- (***)

10. Action by the Divisional Officer of Central Stores Division (I) on receipt of the

copy of Receipt Scroll (without challan) form the dealing branch of the accredited

Bank.

Divisional Officer of the Central Stores Division(I) will note the remittance in

Part I – Cash remitted and acknowledged of the “Schedule of monthly

reconciliation of Cheques and Remittances” in Form 51 to be sent alongwith

Monthly Account to the PAO of Central Stores Division for reconciliation

purposes.

11. Clearance of minor head “108 – Public Sector Bank Suspense” below the Major

Head “8658 – Suspense Accounts” by the Principal Accounts Office.

On receipt of “Receipt Put Through Statement” from Reserve Bank of India,

Principal Accounts Office will prepare the following Transfer Entry in Form

CAM-34 to clear the Debit lying under the minor head “108 – Public Sector Bank

Suspense”

Debit Major Head: 8675 – Deposits with Reserve Bank

256

Rs.15,000 Minor Head: 101 – Central (Civil)

Sub-Head: Reserve Bank (PSB)

To

Major Head: “8658 – Suspense Accounts

Minor Head: 108 – Public Sector Bank Suspense

(-) Debit

Rs.15,000/-

(****)

This Transfer Entry will be incorporated in the Monthly Account and the

PAO of Central Stores Division I will be intimated about the clearance of minor

head – “108 – Public Sector Bank Suspense” to enable him to keep suitable Note

against the original entry in his books.

From the above mentioned accounting adjustments it could be seen that

credit to sub-head “Public Works Cheques” under the minor head “102 – Public

works Remittances” below the Major Head “8782 – Cash Remittances Etc.” at (*)

at Sl.No.1 gets cleared by minus credit to this head at (*) at Sl.No.6.

Similarly credit under the minor head “108 – Public Sector Bank

Suspense” below the Major Head “8658 – Suspense Accounts” appearing at (**)

at Sl.No.6 gets cleared by minus credit to this head at (**) at Sl.No.8

Debit to Sub-head “Remittances into Bank” under the minor head “102 –

Public Works Remittances” below the Major Head “8782 – Cash Remittances

Etc.” appearing at (***) at Sl.No.2 gets cleared by minus Debit to this head at

Sl.No.9 (***).

Debit under the minor head “108 – Public Sector Bank Suspense” below

the Major Head “8658 – Suspense Accounts” appearing at (****) at Sl.No.9 gets

cleared by minus Debit to this head at (****) at Sl.No.11.

257
Appendix-7-B

(OM No.9(3)/83/TA/35 dated 07-01-85 of CGA’s Office)

PROCEDURE FOR PAYMENTS AGAINST CIVIL CREDIT NOTES (RAILWAY

WARRANTS & RAILWAY FREIGHT CREDIT NOTES)

Railways debits including commission for amounts due on warrants and credit notes are

to be settled as per the procedure given below:-

(a) A new series of the printed credit notes having an office copy foil, a booking

acknowledgement foil and a booking foil (which will bear machine serial number) will be

introduced in place of the existing form containing one counterfoil and one main foil.

The head of the office of the Ministry/Department etc. availing of the credit note facility

should obtain the new credit Note Form Books from their existing source of supply and

be responsible for the safe custody and issue.

(b) A Ministry/Department/Office authorized to avail of the facility of credit notes at

present, shall continue to avail of the facility subject to (a) and (d) et. seq. After retaining

the office copy foil, which will serve as office copy, the user will tender the booking foil

in connection with the booking of freight, clearance of consignment etc. as the case may

be, to the Station Master concerned. The Station Master will retain the booking foil and

return the booking acknowledgment foil to the tendered after recording the booking

particulars including weight, destination, date etc. and amount of charges due thereon.

(c) A Head of Office of such Ministry/Department/Office shall prefer a separate

consolidated claim relating to credit notes used between 1st to 15th of the month and

between 16th to end of the month against his P.A.O. or under cheque drawing powers

conferred on his office; and against Treasury in the case of a State Government or Union

Territory having Treasury System, duly supported by the counterfoil of the credit note

received back from the Station Master of the Railway Station concerned. The ‘Head of
Office functioning under Central Government shall request for issue of (or will draw

under the cheque drawing powers) a cheque of category III only, namely, “not negotiable

and not payable in cash, but creditable to Government Account’. In the case of Head of

Office functioning under a State Government where the bill is to be paid by a Treasury

Officer, the cheque or demand draft should, without exception bear the endorsement

“Account Payee only”. The cheque/demand draft shall be drawn in favour of the F.A. &

C.A.O. of the Railways rendering service, as per indication given by the Station Master in

the Booking acknowledgement foil. While every effort shall be made to deliver the

cheque to the Station Master at the earliest, the cheque relating to the credit notes used

during the first fortnight should be submitted to the Station Master latest by the 25th of

the month and that relating to the second fortnight by the 10th of the following month. A

statement in duplicate indicating the number and ate of the credit notes used during the

relevant fortnight, the amount thereof and the total amount involved for the fortnight

should be prepared by the Head of Office at the time of preparing the bill so as to be

submitted to the Station Master along with the cheque. The Station Master concerned

shall return one copy of the statement duly enfaced with the words “cheque received”

258

(using a rubber stamp or otherwise) in acknowledgement of the cheque received in

payment towards the credit notes. This enfaced statement shall be retained by the Head

of the Office as a record of acquittance of the cheque delivered to the Station Master. As

separate Balance Sheets are prepared by the Railways for Coaching (i.e. passengers,

parcels, luggage, traffic etc.) and for goods traffic, separate cheques/demand drafts

should be obtained for tendering to the Station Master and to the Goods Supervisor for

respective transactions and also for separate statements prepared relating thereto for

obtaining the said acknowledgement.

(d) On demand from the Station Master, the user Departments of the central

Ministries/State Governments/U.T. Governments shall also pay within one month either

in cash or through Supplementary Credit Note, the amount of under charge. If any,

detected during the course of internal check of the Credit Notes/Transaction in the

Railway Accounts Office by the audit or otherwise.

It shall be the responsibility of the Officer authorised to sign the credit notes in each

Ministry/Department/Office to ensure prompt payment as above to the Station Master of

the Railway Station concerned, failing which the Railways will be at liberty to refuse to

book/clear goods or to book against warrants for personnel movement thereafter under

the credit note system, in favour of the Department etc. concerned.

259

Appendix – 7C

Detailed procedure to be followed by P.W. Divisional Officers and P.A.O. of

the Division for the settlement of inter-departmental transactions by cheque/Bank

Draft.

(a). Detailed procedure to be followed by P.W. Divisional Officers and P.A.O.

of the Division for the settlement of inter-departmental transactions by cheque/Bank

Draft. (Settlement of inter-departmental transactions with Cabinet Secretariat and

Ministry of Defence).

1. The expenditure incurred by the Divisional Officers on behalf of Cabinet

Secretariat or/and Ministry of Defence will be booked under the Suspense head

“8658 – Suspense Accounts – 107 – Cash Settlement Suspense Account”

2. The Divisional Officer will send the vouchers in support of the charge on the

work concerned in the normal manner as in respect of other works expenditure,

to his Pay & Accounts Officer, and the vouchers will be subject to post-check in
the prescribed manner in the Pay & Accounts Office concerned.

3. A claim for reimbursement of the monthly expenditure will be made

simultaneously by the Division against the Accounts Officer of the Cabinet

Secretariat or the Ministry of Defence, as the case may be, duly supported by an

attested copy of the Schedule of Works Expenditure (without any supporting

vouchers) in Form CPWA 64. The Accounts Officer concerned will settle the

claim within one week of receipt of claims on the basis of this in accordance

with the instructions contained in Para 8.3.3 (d)(i) of Civil Accounts Manual.

4. As the claim for March will be received by the Accounts Officer of Cabinet

Secretariat or Ministry of Defence only after the expiry of the financial year, the

procedure of operating the head “PAO Suspense” as detailed in para 8.4.2

CAM, shall be followed for the accountal of the expenditure in the concerned

year itself.

5. In the month of March, the Divisional Officer will send an extra copy of the

schedule of Works Expenditure to his Pay and Accounts Officer who will

certify that the total expenditure for the year shown in Column 7 against the

work concerned is correct and forward this certified schedule to the concerned

Pay & Accounts Officer.

6. Any excess/short payments which come to light as a result of the post-check of

the Divisional Accounts will be communicated by the Pay and Accounts officer

to the Division originating the debit for rectification of the resultant charge in

the subsequent month’s accounts.

7. It will be the responsibility of the Division originating the debits to watch the

realization of the payments from the concerned Pay and Accounts office and

clear the suspense head in its books.

8. The Division would also watch that the expenditure incurred on the work does

not exceed the administrative approval, technical sanctions and appropriation of

funds, originally sanctioned or subseuqnetly revised.

260

Note(1) In respect of works etc executed on behalf of other Ministries/Departments

for which budget provision is included in the Demands for Grants of CPWD, the

question of operating the minor head “107 – Cash Settlement Suspense Account”

below the major head “8658 – Suspense Accounts” would not arise. The expenditure

will be debited in the Divisional Accounts to the final heads against the concerned

sub-head of the Demand. Similarly this minor head will not be operated in case of

settlement of inter-departmental transactions through book adjustment carried out on

the basis of authorization i.e. without resorting to cash settlement.

Note (2) So far as works expenditure incurred by the CPWD in Nepal on behalf of the

Ministry of External Affairs in concerned, the reimbursement of the expenditure will

be claimed and received by the Pay & Accounts Office, CPWD (FOOD Zone), New

Delhi instead of by the CPWD Divisions direct.

9. The procedure explained above will also be followed for settlement of

transactions arising on account of execution of Civil Works by the Departments of the

Government (which though function on the lines of CPWD, but the Divisional

Officers have no cheque drawing powers and all their claims are subject to pre-check

and payment by the PAO) on behalf of other Governments/Departments with the

modification that instead of operating the minor head – 107 – Cash Settlement

Suspense Account”. The minor head “PAO Suspense” will be operated in their books.

(b) Procedure for accounting of stores purchased by placing indents on

DGS&D in exceptional cases( Settlement of inter-departmental transactions

between Pay and Accounts Officer, Deptt.of Supply and Pay & Accounts Officer of

the CPWD Division and accountal thereof in the books of Divisional officers.)

In terms of the provisions of Rule 140 of General Financial Rules,2005, the

Ministries/ Departments have been delegated full powers to make their own arrangements

for procurement of goods. In case however, a Ministry or Department does not have the

required expertise, it may project its indent to the Central Purchase Organisation i.e

DGS&D with the approval of Competent Authority. In such an eventuality Divisional

officers with the approval of Competent Authority of the C.P.W.D may project their

indents for the procurement of goods to D.G.S&D. Accounting procedure to be followed

in this regard would be as under:-

1. On receipt of indent, DGS&D will arrange the supply of stores as per the

terms and conditions agreed to in the “Acceptance of Tender”. After supplying the stores

to the concerned Division, Supplier/Contractor through whom such supplies have been

arranged will submit his claim together with supporting vouchers to P.A.O, Department

of Supply for payment.

2. PAO, Department of Supply after necessary pre-check will make the

payment on behalf of the Indenting Division to the Supplier by debiting the

Major/Minor/Sub-head “8658 – Suspense Accounts” – 101 – P.A.O Suspense –

Transactions adjustable by the P.A.O of the Division …..” per contra credit to the

Major/Minor Head “8670 – Cheques and Bills – 102 – P.A.O Cheques” to be drawn in

261

favour of the Supplier. Thereafter P.A.O, Department of Supply will raise a claim

through outward claim against the P.A.O of the Division concerned.

3. On receipt of outward claim together with supporting vouchers from

P.A.O, Department of Supply, the PAO of the Division after preliminary scrutiny of
vouchers will make payment to P.A.O, Department of Supply by affording minus credit

to a distinct Sub-head “Payment for purchases through DGS&D” under the existing

Minor Head “129-Material Purchase Settlement Suspense Account” below the Major

Head “8658 – Suspense Accounts” per contra credit to Minor Head “102-P.A.O

Cheques” below the Major Head “8670 – Cheques and Bills” to be drawn in favour of

PAO Deptt. Of Supply.

4. The Division on receipt of the materials procured by placing indents on

DGS&D, will as usual credit the value of stores to a distinct Sub-head “Purchases

pending payment/adjustment” under the Minor Head “129 – Material Purchase

Settlement Suspense Account” below the Major Head “8658 – Suspense Accounts”. This

Sub-Head will also accommodate the cost of direct purchases of stores by the Division in

case payment to Supplier is not made in the same month in which Stores have been

received. The Sub-head operated for direct purchases will be cleared by minus credit per

contra credit to Sub-head “Public Works Cheques” under the minor head “102-Public

Works Remittances” below the Major Head “8782 – Cash Remittances etc.” to be drawn

in favour of the Supplier at the time of issue of the cheque to him. The credits appearing

under this sub-head will be entered in the “Register of Purchase”- C.P.W.A 67. The

P.A.O Memos when received from the office of the PAO will, after verification of the

correctness of the amount with reference to the materials received, be adjusted in the

Divisional Accounts by credit to the sub-head “Payment for purchases through DGS&D”

under the minor head “129-Material Purchase Settlement Account Suspense” below the

Major Head “8658 – Suspense Accounts”.

5. The credit under the Sub-head “Payment for purchases through DGS&D”

appearing in Divisional Accounts on account of adjustment of P.A.O Memo, will be

paired off/netted with the minus credit under this Sub-head given by the P.A.O. After
reconciliation, the P.A.O will inform the Division concerned about the P.A.O Memos not

adjusted or pending for further action.

6. Though the transaction in regard to discharge of liability falls under

“Public Account”, the Departmental authorities will closely watch the clearance of

balances under the Minor Head “129 – Material Purchase Settlement Suspense Account

below the Major Head ‘8658 – Suspense Accounts’.

7. Accounting adjustments in the books of PAO, Department of Supply,

PAO of the Division and the Division concerned will be as under:-

(a) When the P.A.O, Department of Supply makes payment on behalf of the PAO

of the Division to the Supplier:

Debit: Major Head “8658 – Suspense Accounts”.

Minor Head “101 – Pay & Accounts Office Suspense”

Sub-Head “Transactions adjustable by the P.A.O of the Division of CPWD

To Credit

Major Head “8670 – Cheques and bills”

262

Minor Head “102 – Pay & Accounts offices cheques”

(Cheque to be drawn in favour of the Supplier in terms of the provisions of para

8.2.1 of Civil Accounts Manual )

Note: P.A.O, Deptt of Supply will send outward claim in C.A.M Form 54 together with

the supporting vouchers to P.A.O of the Division for claiming re-imbursement of

payment made on behalf of the P.A.O of the Division.

(b) On receipt of outward claim from P.A.O, Deptt of Supply, P.A.O of the Division

after preliminary scrutiny of vouchers will make the payment to the P.A.O of the Deptt.

of Supply by passing the following entries in his Account.

(-) Credit Major Head “8658 – Suspense Accounts”

Minor Head 129 – Material Purchase Settlement Suspense Account

Sub-head: Payment for purchases through DGS&D

To Credit

Major Head: 8670 – Cheques and Bills

Minor Head: 102 – Pay and Accounts Office Cheques

(Cheque to be drawn in favour of P.A.O, Department of Supply)

The Pay and Accounts Office will send PAO Memo alongwith vouchers to the Division

concerned.

(c) On receipt of materials procured by placing indent on D.G.S&D, the Division will

make the following entry in the Divisional Accounts.

Debit Major Head”2059 – Public Works” or any other functional Major Head under

which the material is to be accounted for

Minor Head: 799 – Suspense

Sub-Head: Stock

Or

To the functional Major/Minor Head of Works concerned

To credit

Major Head: 8658 – Suspense Accounts.

Minor Head: 129 – Material Purchase Settlement Suspense Account

Sub-Head: Purchases pending payment/ adjustment

Note: Sub-major head under the functional Budgeted Major Head wherever required

may be opened.

(d) Adjustment of PAO Memo received from PAO of the Division.

After verification of the correctness of the amount with reference to the materials
received, Division will pass the following entry in its Accounts.

(-) Credit Major Head: 8658 – Suspense Accounts

Minor Head: 129 – Material Purchase Settlement Suspense Account

263

Sub-Head: Purchases pending payment adjustment

To Credit

Major Head: 8658 – Suspense Accounts

Minor Head: 129 – Material Purchase Settlement Suspense Account

Sub-Head: Payment for purchases through DGS&D

The credits under the Sub-head “Payment for purchases through DGS&D” appearing in

Divisional Accounts on account of adjustment of P.A.O Memo stands paired off/netted

with the minus credit under this Sub-head given by P.A.O of the Division.

Note (i) The credit under the minor head “102 – P.A.O Cheques” below the Major Head

“8670 – Cheques and Bills” appearing in the Books of P.A.O, Deptt of Supply and P.A.O

of the Division will be cleared in the usual manner on their inclusion in the Payment

Scrolls of both the P.A.Os.

The accounting adjustment will be as under:-

(-) credit Major Head:”8670 – Cheques & Bills”

Minor Head: 102 PAO Cheques

To credit

Major Head: 8658 – Suspense Accounts

Minor Head: 108 PSB Suspense

Or

Major Head: 8675 – Deposits with Reserve Bank

Minor Head: 101 Central (Civil) as the case may be.

Minor Head “108 – P.S.B. Suspense” below the Major Head”8658 – Suspense Accounts”

will be cleared on receipt of Put Through Statement by minus credit to 108-

P.S.B.Suspense per contra credit to the Major/minor/Sub- Head “8675 – Deposits with

Reserve Bank – 101 – Central (Civil) (P.S.B)

(ii) Debit under the Head “8658 – Suspense Accounts” “101-PAO Suspense”

appearing in the Books of P.A.O, Deptt of Supply would be cleared on encashment of the

Cheque received from the P.A.O of the Division by Debit to Major/Minor/Sub -Head

“8675 – Deposits with Reserve Bank – 101 – Central (Civil)(Reserve Bank) and (-) Debit

Major/Minor Head “8658 – Suspense Accounts – 101 – PAO Suspense; as the accredited

Bank of Deptt. of Supply is Reserve Bank of India.

(c) Inter-Departmental Settlement through “Authorisation”.

1. With a view to minimizing the operation of Suspense Heads viz. the Minor Heads

“101-PAO-Suspense” and “107-Cash Settlement Suspense Account” below the Major

Head “8658-Suspense Accounts” and also to arrest future accumulations thereunder, the

Scheme of Authorisation was introduced from the Financial Year 1986-87 in the

Government of India.

2. Under the said scheme of authorisartion, the monetary settlement for inter-

Departmental transactions was dispensed with and the procedure related thereto for

264

specified programmes /Activities based on the Controller General of Account’s, Office

Memorandum No. 1(8)(7)/85/TA/1099 dated 30-10-1986 was laid down in Appendix 7-

D of the CPWA Code. The said scheme of authorization for the execution of Works etc.

was further extended to schemes of all the Ministries/Departments with the exception of

the Schemes of Non-Civil Departments vide CGA’s OM No. 1(8)(3)/92/TA/90 dated 27-

01-1993 and amended vide CGA’s OM No. 18(9)/92/TA/210 dated 27-03-1996.

3. As per the Scheme of authorization, the functional Department with the approval

of its Financial Adviser/Chief Controller of Accounts/Controller of Accounts, issues an

Administrative Approval and Financial Sanction placing Annual Budget Allocation

(indicating Grant Number, Complete Computer code numbers relating to the Head of

Accounts,) amount approved in the Budget for the year for the programme /activity

assigned to the Agent/Executing Department at the disposal of the Department for the

execution of the concerned scheme/activity. This constitute authorization for the

executing Ministry/Department to incur expenditure upto the limits specified in the letter

of Authorisation.

The sanction is addressed to the Pay and Accounts Officer of the Division concerned and

copy thereof is endorsed to the Principal Accounts Office as well as to the Divisional

Officer who in turn sends the proposal for obtaining L.O.C. to the L.O.C. Cell of the

Principal Accounts Office to accommodate the requisite expenditure. The P.A.O. of the

executing/agent Department incurring the expenditure is not only to book the expenditure

to the Budget Head of the functional/service Department but must also directly

communicate the monthly and progressive figures of expenditure to the Accounts Officer

of the concerned service Department under the advise to his own Principal Accounts

Office to enable them to monitor the monthly flow of expenditure on the

programme/activity. These figures shall be provided to the functional department to

latest by the 20th of the month following the month of Account. The amount so

allocated/earmarked will not be available of re-appropriation by the functional

Ministry/Department except with the concurrence of agent Ministry/Department. Since

the execution of work on behalf of functional Ministry/Department is undertaken by the

Divisions of C.P.W.D. under the contractual obligations, no deviation in the allocated

funds is permissible without the consent of Agent/Executing Department.

5. At the close of financial year, the Principal Accounts Officer of the Agent

Department would record a certificate to the effect that the progressive figures of

expenditure, as shown in the statement of expenditure for the month of March/March

Supplementary under the respective unit of appropriation, have been duly reconciled with

the Statement of Central Transactions.

6. The P.A.O. of the functional Ministry/Department while preparing Annual

Appropriation Accounts of its Ministry/Department would take into account the

progressive figures of expenditure as reported to him by the P.A.O. of the Agent

Department for the month of March/March Supplementary. Simultaneously, he would

265

carry out necessary reconciliation of expenditure through the Statement of Central

Transactions in consultation with the P.A.O. of Agent Department. While preparing

Annual Appropriation Accounts, Principal accounts Office of the functional

Ministry/Department will furnish “Statement showing Reconciliation of Appropriation

Accounts figures with the Statement of Central Transactions (Finance Accounts) figures

for the financial year in Annexure-III to be appeared with its Annual appropriation

Accounts.

7. At no stage, the Agent Department shall exceed the Budget allocations indicated

by the functional Ministry/Department. If an excess is anticipated, the Agent Department

shall immediately bring the matter to the notice of the Functional Ministry/Department

and request them for more allocation or further instructions. Copies of such letters shall

be endorsed to the Chief Controller of accounts/Controller of accounts of the Agent

Department, who shall ensure that no excess drawals are made.

Note : Procedures laid down in Appendix 7-D of C.P.W.A. code and the Controller

General of Accounts O.M. Nos. 1(8)(7)/89/TA/677 dated 19th July, 1989, 18(3)/92/TA/90
dated 27-01-1993 and 18(9)/92/TA/210 dated 27-03-1996 as amended from time to time

should be strictly adhered to by all the concerned Functional as well as Agent

Ministries/Departments.

266

Appendix 7 C

FORM No. 1

Clint-wise Register of Transactions adjusted under the Minor Head “107 Cash Settlement

Suspense Account” below the Major Head “8658-Suspense Account”.

PART I-Details

Name of the client Deptt. ……………………………. Month………………..

S.

No.

Reference of,

voucher or Transfer

Entry Order

Particulars

of

transaction

Value of

stores issued

or service

rendered

Date of

Receipt of

Payment
Remarks (including

indication of the

vouchers sent in

support of the debits)

1. 2. 3. 4. 5. 6.

Balance

b/f

Total

Rs.

@ Less credits during the month _______________________

Closing Balance _________________________

………………………………………………………………………………………………

No. …………... Date……………

Copy alongwith …….. vouchers forwarded to the P.A.O., Cabinet Secretariat/ Controller

of Defence Accounts……………………………. . A sum of Rs. ………………….(as

detailed above) is due from his on account of works executed or services rendered to his

Department during and to end of ………20….. . He is requested to send within ten days

of the receipt of this claim, cheque/Bank draft for the total amount, drawn in favour of the

undersigned.

Encl.:-

Executive Engineer

………………….. Division

267

Appendix 7 C(c)

FORM No. I (Part II)

Clint-wise Register of Transaction adjusted under the Minor Head”107”

Cash Settlement Suspense Account below the Major Head 8658-Suspense

Account

Part-II Abstract Account of Debits, Credits and Balances under the head 107 “Cash

Settlement Suspense Account”

S. No. Name of April 20

Clint Deptt.

Open-ing

Balance Debits Credits Closing

Balance

And so

on for

the

remaining

in

month of

the year

Remarks

1. 2. 3. 4. 5. 6. 7. 8.

268

Appendix 7 –C(c)-Contd.

FORM No. 2

(Referred to in Paragraph 22.4.10)

Office of the ______________________

(Name of the Clint Department/Ministry)

Dated _______________ 20______

As requested in his letter No. ………………. Dated ………….…...… a

Cheque/Bank Draft No. …………… Dated ……….. for Rs. ……………..(Rupees

…………..…….……… ……………………………..) is sent herewith –

The receipt of this letter may please be acknowledged.

Enclosure:

Accounts Officer, Cabinet Secretariat /

Controller of Defence Accounts

Ministry of Defence

To

The Executive Engineer

………………………. Division

…………………………………

269

Appendix 7-C-Contd.

FORM No. 3

Register of Claims received

Name of Devision__________________________________________

Month___________________________________________________

S.

No.

Number and date of

letter with which the

claim received.

Amount Number and

date of

Cheque/Bank

Draft issued

Initials of

Divisional

Accountant

Remarks

1. 2. 3. 4. 5.

270

APPENDIX 7 – D

(OM No. 1(8)(7)/85/TA/1099 dt. 30.10.86 of CGA’s office)

Procedure for settlement of Inter-departmental

Transactions on specified Programmes/Activities

The system of settlement of Inter-departmental transactions in respect of the

following types of cases, by monetary settlement has been replaced by the procedure

detailed in para 2.

(1) (a) In respect of programmes/activities for which one Central

Ministry/Department utilses the services of another Central Ministry/Department as its

agent for executing the whole or a part of that activity, this would also cover execution of

works by the CPWD on behalf of other Central Ministry/Department for which provision

exists in Demand for Grants of the administrative Ministry concerned, and

(b) in the demand for grant of the functional Ministry/Department there is a

clear earmarked provision under sub-head/detailed head for that programme/activity.

(ii) In the case of Centrally sponsored Plan Schemes and Central Plan Schemes,

provision for which is made in the relevant functional major head in the demands for
grants of the Central Ministry/Department but meant for actual utilization in the U.T.

Administration.

For examples, provision for Special Central Assistance to Special Component Plan for

Schedule Castes made for Delhi Administration under Major Head “2235-Social Security

and Welfare” in the Demand for Grants of Ministry of Welfare for 1986-87.

2. Based on budget provision made and resources earmarked, the functional

department concerned would issue an administrative sanction in favour of the agent

department clearly indicating the budget provisions for such earmarked funds available

for the financial year and the Head of Account to which the expenditure is debitable. A

copy of such sanction would be endorsed to the Accounts Officer of the functional

department to enable him to keep a note of this in the Expenditure Control Register

maintained by him. He will then authorize the Accounts Officer of the Agent

Department to incur the expenditure within the limits specified in the sanction and to

book the same finally in his books by operating the Head of Account specified in the

Authority. Accounts Officers of the Agent department would furnish monthly and

progressive figures of expenditure to the Accounts Officer of the functional department to

enable the latter to monitor the flow of expenditure on the programme/activity. The

Accounts Officer of Agent Deptt. will in no case honour any claim which would result in

excess over the amount authorized by the functional department. Annual reconciliation

of expenditure will be conducted by the two Accounts Officers through the Statement of

Central Transactions as per the normal procedure.

271

3. The procedure detailed in paragraph 2 above would also apply as in the case of

para 1(ii).

4. The programme/activities identified wherein the above procedure will apply are
given in the enclosed annexure. Specific approval of Controller General of Accounts

would be necessary for extending it to any other programme/activity.

Note: See also paragraph 3 of Ministry of Finance, Controller General of Accounts,

O.M. No. 18(3)/92/T.A/90 dated 27-01-1993.

272

ANNEXURE
------------------------------------------------------------------------------------------------------------

ACTIVITIES WHERE SETTLEMENT OF INTER-DEPARTMENTAL

TRANSACTIONS THROUGH CHEQUES CAN BE DISPENSED WITH

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

Name of Ministry/

Department having

Provisions of funds

Name of Ministry/

Department

performing agency

functions

Name of Activities Remarks

1. 2. 3. 4.

1. Ministry of

Energy

(Deptt. of Power)

Ministry of Water

Resources

(1) Hydrological observations

(i) Chenab Basin.

(2) Bursar Project

(3) Baglihar Project

(4) Ikahala Bendalkot Kiryar

Nallandown Steam

Bursar

(5) Investigations for hydro

power protentialities in

Sikkim

(6) Sawalkot

(7) Investigation to

Pancheswar Project.

(8) Lower Lagyap H.E.

Project

2. Home affairs Ministry of Urban

Development

(9) Indo-Bangladesh Border

Fencing Work

(10) Construction of Roads,

Bridges, Buildings,

Residential Quarters,

Hospitals etc., under the

administrative control

of Ministry of Home

Affairs.
3. Deptt. of Food Ministry of Urban

Development

(11) Indian Grain Storage

Research Institute

4. Deptt. of Supplies Ministry of Urban

Development

(12) National Sugar Institute

5. Various Ministries Union Territories

with out

legislatures

(13) Grants-in-aid to Union

Territories (where

accounts are

departmentalized) for

centrally sponsored plan

schemes an Central

Plan Schemes.

273