Notification(Defence) – Cantonment Board Account Rules, 2020
MINISTRY OF DEFENCE
NOTIFICATION
New Delhi, the 3rd March, 2020
S.R.O.2(E).- Whereas the draft of the Cantonment Board Account Rules, 2017, which the Central Government proposes to make, in exercise of the powers conferred by section 346 read with section 125 of the Cantonments Act, 2006 (41 of 2006), was published as required under sub section (1) of section 346 of the said Act in notification of the Government of India in the Ministry of Defence vide S.R.O. 28(E), dated the 17th August, 2017 in Gazette of India,
Extraordinary Part – II, section 4, inviting objections and suggestions from all persons likely to be affected thereby till the expiry of forty five days from the date of publication of the said notification;
And whereas, objections and suggestions received in respect of the said draft rules have been considered by the Central Government;
Now, therefore, in exercise of the powers conferred by section 346 read with 125 of the Cantonment Act, 2006 (41 of 2006) and in supersession of the Cantonment Account Code, 1924, except as respects things done or omitted to be done before such suppression, the Central Government hereby makes the following rules relating to the Cantonment Board Account, namely:-
CHAPTER I
PRELIMINARY
1. Short title, extent and commencement.- (1) These rules may be called the Cantonment Board Account Rules, 2020.
(2) They shall extend to all cantonments in India.
(3) They shall come into force on the 1st day of April, 2020.
2. Definitions.– (1)In these rules, unless the context requires otherwise,-
(a) “Act” means the Cantonments Act, 2006 (41 of 2006);
(b) “Accounting Software System” means the software utilized for the preparation and maintenance of accounting records under the double entry based accrual method of accounting and which has been made available or recommended as specified in sub-rule (4) of rule (7);
(c) “accrual” means recognition of revenues and expenses as they are earned or incurred (and not as money is received or paid) and includes recognition of transactions relating to assets and liabilities as they occur irrespective of the actual receipts or payments;
(d) “Accrual Basis of Accounting” is the method of accounting whereby revenues and expenses are identified with specific periods of time, such as a month or year, and are recorded as earned or incurred, alongwith acquired assets, without regard to the date of receipt or payment of cash, as distinguished from cash basis;
(e) “Appendix” means an Appendix appended to these rules;
(f) “Auditor” means the Principal Controller of Defence Accounts, the Command, or the Controller of Defence Accounts concerned or any officer designated so by the Controller General of Defence Accounts, and includes any other Chartered Accountant or firm of chartered accountants or special auditor authorized by him in writing to perform the functions of an auditor; or any other person or authority appointed by the Government or authorized under any law for the time being in force;
(g) “authorized officer” means the Chief Executive Officer or any other officer of the Board authorized by him in writing to perform any act or duty under these rules;
(h) “bank” means a bank referred to in sub-section (1) of section 120 of the Act;
(i) “cantonment fund” means a general operating fund of a Board as referred to in sub-section (1) of section 119 of the Act which is used to account for all financial resources of the Board, except the cantonment development fund or any special or trust funds as provided in the Act, which comprises the net balance of the assets of the entity after deducting all its liabilities;
(j) “cantonment development fund” means the mandatory special fund referred to in sub-section (2) of section 119 of the Act;
(k) “cashier” means any employee of the Board working in the Accounts Department entrusted with the task of receiving cash or cheques or making disbursements or payments at any office of the Board, where books and records are maintained: Provided that where there is more than one such person, the person so designated or the person to whom such duties have been entrusted by the Chief Executive Officer shall be the cashier;
(l) “Controller General of Defence Accounts” means an officer who is the head of Defence Accounts Department in the Ministry of Defence;
(m) “Form” means a Form annexed in Schedule VI to these rules;
(n) “Head of Accounts” shall mean the head of accounts department;
(o) “Head of Department” means an officer placed in charge of a department of the Board;
(p) “original works” means public works undertaken for all new constructions, and includes special repairs to newly purchased or previously abandoned buildings or structures, which are required for bringing them into use or which result in an increase in future benefits flowing from the asset;
(q) “maintenance works” means the works other than original works;
(r) “President” means the President of a Board;
(s) “Principal Controller of Defence Accounts, the Command” means the Principal Controller of Defence Accounts having jurisdiction in respect of the cantonment concerned;
(t) “re-appropriation” means the transfer of funds from one budget head to another;
(u) “suspense account” means the head of account under which transaction of a temporary character which are not to be adjusted forthwith in the accounts as final receipts or outlay or the correct classification of which cannot be determined, are recorded;
(v) “temporary establishment” means an establishment employed for a limited period on a definite rate of pay and paid on a monthly basis and does not include daily labour or outsourced personnel.
(2) Words and expressions used and not defined in these rules but defined in the Act shall have the same meanings as assigned to them in the Act.
CHAPTER II
GENERAL
3. Effect of close holidays.–Whenever in these rules, any action or proceeding is directed or allowed to be done on a certain day or within a specified period, then, if the office is closed on that day or on the last day of the specified period, the action or proceeding shall be deemed to have been done in due time, if it is done on the next working day.
4. Money payable to be rounded off to the nearest multiple of a rupee.-(1) All amounts paid shall be rounded off to the nearest rupee; an amount of fifty paise or more shall be rounded off to the next higher rupee and while an amount below fifty paise shall be rounded off to the immediately lower rupee:
Provided that such rounding off shall not apply to any receipt of revenue by the Board or demands against the Board which are fixed by or under any law for the time being in force:
Provided further that where applicable, the rounding off of the fraction of a rupee shall be done only in respect of the net amount payable or receivable on a bill and not in respect of the individual items of claims or adjustments in bill.
(2) The balance arising upon all such amounts rounded off as per sub-rule (1), shall be transferred to a ledger account in the Accounting Software System.
5. Language for maintaining books of account.–The books of account shall be maintained both in Hindi and in English.
6. Use of prescribed registers and Forms.–No Board shall use the registers and Forms except as prescribed in these rules.
7. Manner of maintaining accounts.–(1)All money transactions to which any member of a Board or any officer or employee of the Board is a party in his official capacity, shall, immediately and without exception, be brought to account in the books of the Board and all monies received, other than monies withdrawn from the bank to meet current expenditure, shall without delay be deposited into the bank and shall be credited to the appropriate account and shall not be utilized to meet current expenditure of the Board.
(2) All transactions of the Board shall be identified with funds, and separate accounting records maintained for each such fund in the manner specified in rules 11 and 12.
(3) Every Board shall maintain its books of account using the double entry system of accounting and all accounts shall be maintained as per the accrual method of accrual basis of accounting.
(4) The accounts shall be maintained, as far as may be, on computers using the Accounting Software System made available or recommended by the Director General.
(5) The Chief Executive Officer shall be responsible to ensure that all the accounting and financial data are available in a manner prescribed by these rules.
(6) If for any reason the computer system or the Accounting Software System on which the accounts are to be maintained is non-functional or is unable to give the output as prescribed in these rules, the Chief Executive Officer shall make arrangements to manually maintain the requisite records for such time as is considered necessary.
8. Corrections in accounts.–(1)The deletion or modification of entries already authorized and passed shall not be permitted and in the event of any error being noticed, the same shall be rectified by passing rectification or reversal entry through a journal voucher entry authorized by the Head of Accounts.
(2) All rectification or reversal entries shall be dated only as per the date of the authorization of such entry:
Provided that –
(a) if the financial year in regard to which such correction is being made is over but the financial statements for the said year have not been finalized, the rectification entry shall be dated as on the last day of the financial year to which it relates;
(b) if the financial year in regard to which such correction is being made is over and the financial statements for the said year have been finalized and the accounts for the year closed then the rectification, reversal, transfer entries or adjustments shall be made in the accounts of the subsequent years in which the error is noticed by clearly identifying such entry as a prior period entry.
9. Recognition of income.–Incomes that are not recognized in accordance with the provisions of Chapter VII shall be recognized and recorded in accordance with the policy laid down and disclosed in the statement of accounting policies of the Board.
10. Recognition of expenditure.–The expenditure that is not recognized in accordance with the provisions of Chapter IX of these rules shall be recognized and recorded in accordance with the policy laid down and disclosed in the statement of accounting policies of the Board.
11. Accounts of cantonment fund and cantonment development fund.– (1) No fund shall be maintained by the Board except those authorized by the Act or these rules.
(2) The Financial Statements of the Board shall be prepared in accordance with the provisions of these rules and shall contain separate parts in regard to the cantonment fund and cantonment development fund that may be created under the Act.
(3) The Board shall maintain separate accounts in respect of following funds, namely :–
(a) cantonment fund (as specified in sub-section (1) of section 119 of the Act); and
(b) cantonment development fund (as specified in sub-section (2) of section 119 of the Act).
(4) Where any sum is received from the Central Government or the Government of any State by way of contributions, grants, subsidies or by any other way for any specific purpose or for the implementation of any specific scheme or for execution of any specific project, the Board shall maintain a separate set of accounts for each such specific purpose, scheme or project, which shall be known as “xxx Scheme Cantonment development fund” or “xxx Project
Cantonment development fund”1.
(5) The sums received or set aside for a specific purpose, scheme or project under the cantonment development fund, shall maintain,-
( a) separate accounts and vouchers for each such purpose, scheme or project which shall be prepared separately;
(b) separate bank account for each such specific purpose, scheme or project and receipts and remittances shall be made only to and from the bank account of that specific purpose, scheme or project within the cantonment development fund.
(6) The net balance at the end of every accounting period, arising out of amounts received by or accrued to the cantonment development fund less the amount of expenditure, refund or diminution in the cantonment development fund shall be reflected in the balance sheet of the Board, giving where considered necessary, the details of the transactions of such fund for specific scheme or project as a separate category under the cantonment development fund during the year by way of a schedule to the balance sheet.
(7) Unless otherwise expressly provided by any other rule or notification issued under the Act, the procedure prescribed in these rules shall to the extent possible, apply mutatis mutandis to the cantonment development fund in regard to the conduct, recording and accounting of the transactions in respect of the funds for specific purpose, scheme or project as a separate category.
12. Transactions in cantonment development fund.–
(1)The transactions of the cantonment development fund shall be in accordance with the specific directions and conditions, if any, laid down by the grantor or donor of the funds for such special purpose, scheme or project:
Provided that no such direction or condition shall have the effect of overruling the provisions of this sub-rule unless specifically approved by the Central Government.
(2) All expenses incurred for or out of the cantonment development fund for the specific purpose, scheme or project for which a separate account is maintained within the cantonment development fund, shall be treated as part of the expenses of the respective specific purpose, scheme or project account or of the cantonment development fund and all incomes shall be credited to the corresponding cantonment development fund in the manner provided in section 120 of the Act.
(3) In the absence of any direction to the contrary by the donor or grantor of any funds for any specific purpose scheme or project within the cantonment development fund and upon the objects for which the grant-in-aid was received thereunder being achieved, the unspent balance, if any, shall be transferred to the cantonment fund with approval of the Board.
The name of the Scheme or Project shall be inserted at “XXX”
13. Separation of revenue and account branches.-
(1) The revenue and accounts branches of every Board shall be kept distinct from each other under separate officials and such officials shall be designated as the Head of Revenue Department and Head of Accounts Department, respectively.
(2) All sums due to the Board shall be received by the such designated officers as specified under sub-rule (1) and in no case shall the same person compile the accounts and superintend the collection of taxes and other revenue.
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