CHAPTER I INTRODUCTORY

January 20, 2025

1. This Code mainly contains rules relating to all financial transactions of Government which fall into two broad classes, viz., receipts and disbursements. These rules should be followed by every Government servant in the matter of receipt, custody and disbursement of Government money. These rules are supplementary to treasury rules and should be applied in conjunction with them.

2 These rules shall come into force with immediate effect.

3 In this Code, unless the context requires otherwise, the following words and phrases have the meanings hereby assigned to them. Words and phrases used in the code, which have been defined in the Constitution of India, or in the Rules and Orders framed under the Constitution, have the meanings assigned to them in those definitions.

“Accountant-General” means the head of an office of Accounts and Audit subordinate to the Comptroller and Auditor General of India whether known as “Accountant General” or by any other designation, who keeps the accounts of the state and exercises audit functions in relation to those Accounts on behalf of the Comptroller and Auditor General of India.

“Administrative Approval” means the formal acceptance by an administrative department of a proposal that the Public Works Department should incur a specified amount of expenditure on a specified work required by, or in connection with that administrative department. It amounts to an instruction to the Public Works Department to execute a specified work or works at a specified cost to meet the administrative needs of the department which requires the work (c.f., technical sanctions).

“Appropriation” means the amount provided in the Budget Estimates for a unit of appropriation or the part of that amount placed at the disposal of a disbursing officer.

“The Bank” means any office or branch of the banking department of the Reserve Bank of India, any branch of the State Bank of India, acting as the agent of the Reserve Bank of India in accordance with the provisions of the Reserve Bank of India Act, 1934 (Act 2 of 1934), and any branch of a subsidiary Bank as defined in section 2 of the State Bank of India (Subsidiary Banks) Act, 1959 (Act 38 of 1959), which is authorised to transact Government Business as agent of the State Bank of India, or any other agency appointed by the Reserve Bank of India.

“Bank Draft” (See Rule 377 of the Kerala Treasury Code).

“Book Adjustment or Book Transfer” means the entries made in the Government accounts in respect of a financial transaction which does not involve any actual receipt or disbursement of cash or stores by the Government, so that a disbursement entered under one head (or heads) is exactly counter-balanced by a receipt under another head (or heads). A book adjustment may represent a transaction between different departments of the Government or a correction in entries already made in the accounts

“Budget Estimates” are the detailed estimates of the receipts and disbursements of a financial year.

“Cash Order” means an order issued by a Treasury Officer on a sub treasury within the district for a payment on the Government account or for any authorised purpose of a specified amount to a specified person

“Centage Charges” means in connection with a work which the Government execute on behalf of another Government, a local body or a private party, the charges calculated at a percentage rate on the value of the work done, which the Government recover from the party for whom the work is done towards the cost of the establishment and the tools and plant employed on the work.

Central (Agency) Subject” -See Article 340.

“Central (Agency) Transaction” -See Article 340.

“Cheque” means a written order (not expressed to be payable otherwise than on demand) addressed by a person called the “drawer” to a bank or treasury to pay a specified sum of money to himself or a third party known as the “payee”, and includes a demand draft drawn on any specified bank or banker (including the Reserve Bank of India).

Collector” means the Chief Officer in charge of the revenue administration of a district.

“Completion (in relation to work)” means the finishing or abandonment of the work.

onsolidated Fund, Contingency Fund and Public Account The words “Consolidated Fund of the State, Contingency Fund of the State and Public Account of the State” shall have the meanings respectively assigned to them in Articles 266 and 267 of the Constitution of India.

“Contingencies”-See Article 90.

“Contingent Charges” -See Article 90.

“Contract” means any kind of undertaking, written or verbal, expressed or implied, by a person other than a Government servant or by a syndicate or firm to construct, maintain or repair one or more works, to supply certain stores, or to perform any service in connection with the execution of a work or the supply of stores.

“Contract documents” means the documents required in connection with the giving out of a work on Contract.

“Contractor” means a person, syndicate or firm that has entered into a contract with the Government.

Controlling Officer” means a head of a department or other departmental officer who is entrusted with the responsibility of controlling the incurring of expenditure and/or the collection of revenue by the subordinate authorities of a department.

“Disbursing Officer” means a Government servant who draws money from the treasury on bills or cheques, but excludes a Government servant who is not the head of an office and draws only his own pay and allowances from the treasury.

“Draft” -See Rule 377 of the Kerala Treasury Code.

“Final Payment” means the last payment on a running account made to a contractor in full settlement of the account relating to his contract when the contract has been completed or determined.

“Financial Propriety” Standards of -See Article 40.

“Financial year” means the year beginning with the 1st April and ending with the following 31st March.

“First and Final Payment” means a single payment made to a contractor in full settlement of the account relating to his contract when the contract has been completed or determined.

Government” means the Government of Kerala.

“Government account” means the total of the Consolidated Fund Account, Contingency Fund Account and the Public Account of the State

“Government servant” means any person serving in connection with the affairs of the State, whether remunerated by salary or not and includes every person who is authorised to receive, keep, carry or spend moneys on behalf of the Government.

“Governor” means the Governor of Kerala.

“Head of a Department” means any authority specially declared by the Government to the Head of a Department (See Appendix I ).

“Indian Audit Department” means the officers and establishment, being in India and subordinate to the Comptroller and Auditor General of India, that are employed upon the keeping and audit of accounts of the Central Government and of the States, or upon one or other of these duties.

“Inspecting Officer” means a State Touring Officer who is appointed solely or mainly for performing specified duties of inspection which involve touring and includes an officer who has been specially authorised to conduct inspection of any office.

“Local body” means a District Board, Municipal Council (including City Corporations) or Panchayaths.

“Local Fund” means
(1)the moneys received and administered by a body which, though not part of the Government’s Departmental Organisation, has been placed under the control of the Government by a law, or a rule having the force of law, whether in regard to its proceedings generally or to specific matters, e.g. its budget, creation of particular posts in its service and appointment to such posts and the leave, pension and other rules applicable to its servants;

(2)the moneys received and administered by any other specified body when the Government have published a special notification to the effect that they constitute a “Local Fund”.

“Major Head” means a main head of account for the purpose of recording and classifying receipts and disbursements of moneys that enter into the Government account.

“Market rate/Market value” means, in respect of an article borne on the stock accounts, the cost per unit at which a stock of that article or a suitable substitute for it could be obtained at the time in question at the stores godown from the public market from which it could be obtained most advantageously.

“Measurement Book” -See Article 189.

“Miscellaneous Expenditure” means all expenditure other than that falling under pay and allowances, contingencies and works.

“Muster Rolls” See- Article 186.

“Piece-work agreement” – See- Article 178.

“Public Account”– See “Consolidated Fund, Contingency Fund and Public Account” above.

“Quantity”, means in connection with works the extent of work done, supplies made or services rendered when these can be measured, weighed or counted.

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“Rate” means, in estimates of cost, contracts, contractors’ bills and vouchers generally, the amount payable for each unit of work, supply or other service.

Reappropriation” means the transfer of savings in the appropriation for a unit of appropriation to meet excess expenditure anticipated under another unit.

“Revenues of the State” means and includes all moneys received by a Government servant on behalf of the Government not only the proceeds of taxation and the yield of ordinary revenue but also capital receipts such as the proceeds of sales of land, the proceeds of borrowing operations, unfunded debt and such receipts of a banking or deposit nature as, by virtue of any statutory provision or of any general or special executive order of the Government, have to be held in the custody of the Government.

“Running Account” means an account with a contractor on which payment for work or supplies is made to him at convenient intervals subject to final settlement of the account on the completion or determination of his contract.

State” means the State of Kerala.

Stores” means all articles and materials (other than cash and documents) which come into the possession of a Government servant for use in the public service.

“Sub-head” means in connection with estimates and accounts of works, one of the subdivisions according to items of work, e.g., excavation, brick work, concrete, wood work, etc., into which the expenditure on a work or a sub-work of a large work is divided in order to facilitate accounting and financial control.

“Sub-work” means a distinct unit of a large work which comprises several buildings, smaller works or groups of smaller works. For example, the outer wall, the solitary cells, the cook houses, the jailor’s quarters, etc., would form separate sub-works when a large Central Jail, is built. The sub-works of a large irrigation canal may include the head works, the main line, each branch of a canal, each group of distributaries relating to each branch separately, the drainage and protective works, etc.

“Technical Sanction” means the order of a competent authority sanctioning a properly detailed estimate of the cost of a work of construction or repair to be carried out by the Public Works Department. (c.f. Administrative approval).

Treasury” means any treasury of the State and includes a sub-treasury.

“Treasury Officer” means the officer in immediate executive charge of a treasury.

“Unit of appropriation” means the lowest account head under which the Government places a specific appropriation at the disposal of the spending authority concerned.

“Works” -See Article 163.