SECTION III Cheques CHAPTER I GENERAL A. Applicable to Departments generally

January 20, 2025

239.(a) Save as expressly provided in these rules, no person is authorized to draw on a treasury by means of cheques without the special order of the Government and before he has been placed in account with the Treasury by the Accountant General.

(b) Cheques shall ordinarily be drawn on the district treasury but certain government servants of certain departments are authorized to draw cheques on sub treasuries also. [See Rule 260 (b) in regard to Public Works Officers]. When the Collector considers it desirable, he may give permission to a drawing officer to draw cheques on the sub treasuries in his district.

Cheques from a cheque book obtained from a particular district treasury (See Rule 252) shall not be drawn on any treasury outside that district. A drawing officer shall use a different cheque book for the district treasury and for each sub treasury on which he draws and enter a distinguished letter and a separate series of numbers on the cheques from each book.

240. Whenever a cheque is presented, the treasury shall carefully examine the number printed on it in order to ascertain that it was really taken from the book notified as in use by the drawing officer whose signature it purports to bear. If the payee is not known at the treasury the Treasury Officer shall carefully consider the date, serial number and amount of the cheque as well as the handwriting and make any enquiries that he considers necessary; if he then feels any doubt as to the genuineness of the cheque or the identity of the payee, he shall defer payment and refer to the drawing officer.

A cheque drawn on a treasury may be crossed in accordance with the provisions of Chapter XIV of the Negotiable Instruments Act, 1881 (Indian Act XXVI of 1881), and such crossing is no bar to its being paid at the treasury on which it is drawn.

241. Whenever a government servant draws cheque (other than a cheque the amount of which is typed in words with perforated letters by a special cheque-writing machine), he shall see that it has written across it at right angle to the type the word “under” followed by an amount a little larger than that for which he draws the cheque. For example, “under rupees thirty only” means that the cheque is for an amount less than ` 30 but not less than ` 20, whilst “under rupees eight hundred only” means that it is for an amount less than ` 800 but not less than ` 700. No abbreviation such as “eleven hundred” for “one thousand one hundred” may be used. The amount of a cheque shall be written in the manner prescribed for bills in Rule 163 (c) above.

A common form of fraud in regard to cheques consists in altering the word “one” into “four” by prefixing an ‘ f ‘ and changing the ‘e’ into ‘r’ as the figure can easily be altered correspondingly to 4. The word “twenty” when written carelessly., has also sometimes been changed into “seventy”. A government servant who draws a cheque in which the word ‘one’ or ‘twenty’ occurs shall therefore write the word very carefully in order to make such a fraud impossible. The Treasury Officer shall examine the words “four” and “seventy” and the corresponding figures in cheques with special care.

All cheques shall be written and signed in indelible (unwashable) ink only, which can be obtained from the Controller of Stationery, Trivandrum.

Exception—

*The protective endorsement “under” followed by amount a little larger than that for which the cheque is drawn need not be insisted in respect of Treasury Savings Bank cheque and fixed deposit certificates presented at the treasuries for encashment.

242. (a) Cheques drawn in favour of Government Officers or departments for payment on account of interdepartmental or intergovernmental dues shall always be crossed “Account Payee” if drawn on the Bank and in other cases super scribed with the words “Account Government-not payable in cash” without any crossing.

(b) Cheques, the amounts of which are payable to officers of the Government to enable them to make disbursement of pay and allowances of non-gazetted staff, contingent expenditure etc., on behalf of Government shall be issued in favour of the government official concerned by designation, the word “only” being added after the designation of the payee officer on the cheque. Such cheques shall not be crossed but shall bear the superscription ‘Not transferable’.

(c) (i) Subject to the provisions of the sub-clause (b) all cheques in payment of personal claims of government servants and pensioners shall invariably be to the “order” of the payee.

(ii) Cheques coming within the purview of sub-clause (a), if drawn on the bank, shall be crossed generally with the words “………………….. and Co.” but without the superscription “Account payee only” wherever the amount exceeds ` 1,000. Such cheques for amounts not exceeding ` 1,000 also shal normally be crossed, unless the payee specifically asks for an “Open” cheque in which case it need not be crossed.

(d) In all other cases, cheques if drawn on the bank, shall invariably be crossed with the superscription “Account Payee only” added between the lines on crossing. Where the payee is believed to have a banking account, further precaution shall be adopted, wherever possible, by crossing the cheque specially (instead of by the general crossing) “…………………………. and Co.” by quoting the name of the bank through which the payee will receive payment and by adding the words “Account Payee only-not negotiable”. Such cheques for amount not exceeding ` 1,000 may, however, be issued as “open” cheques if so desired by the payee, but only as “order “ cheques.

NOTE—

Cheques drawn on a Treasury should not be crossed and in cases in which any such cheque has been crossed inadvertently such crossing will have no significance in making payment.

The Treasury Officer may decline to make any payment on a cheque endorsed as payable to “order” or to any person if he is unable to satisfy himself as to the identity of the person claiming payment.

243. [Deleted]

244. As a general rule, the Treasury Officer shall not pay a cheque payable to order, unless it is receipted by the payee himself or another person in whose favour it has been regularly endorsed for payment. If, in special circumstances, the head of an office is unable himself to receive cheques payable to his order owing to absence on our or some other sufficient cause and considers that strict compliance with the ordinary rule would cause undue inconvenience, he may by a written order specially authorize a gazetted government servant to endorse “for” him cheques drawn in his favour by his official designation. The head of the office shall send a copy of any such order at once to the Treasury Officer, and the Treasury Officer shall then treat an endorsement by the duly authorized government servant as though it were an endorsement by the head of the office.

245. (a) As a general rule, no cheque shall be issued for a sum less than₹10, except when it is done in order to comply with the provisions of a law or a rule having the force of law.

Exception—(1)Government servants who are permitted to draw cheque for the pay and allowances of their staff (such as officers of Public Works Department who draw cheques for payment to work establishment staff) may draw cheques for a sum less than `10 for remitting the insurance premia or the contribution to a Provident Fund.

Exception—(2) Cheques for sums less than `10 may be drawn in respect of withdrawals from Personal Deposit Accounts.

Exception—(3)*Cheques for sums less than `10 may be drawn in respect of withdrawals from Treasury Savings Bank Accounts.

(b) A cheque shall remain current only for three months from the date of issue.

246. When a government servant issues a cheque in payment of any amount due by the Government and the cheque is honoured on presentation, payment shall be deemed to be made on the date on which the cheque is handed over to the payee or his authorized messenger or on which the cover containing it is put into the post. If, however, the cheque is marked as “not payable before a certain date” which is later than the date mentioned in the previous sentence, payment shall be deemed to be made on the date on which the cheque becomes payable. Such a cheque shall not be charged in the accounts until the date on which it becomes payable.

247. When a government servant pays an endorsed bill by cheque, he shall not disregard the endorsement and issue the cheque in favour of drawer of the bill.

248.Local fund Cheque.—

The Treasury or Sub Treasury Officer shall not permit the withdrawal of any moneys relating to a local fund from the treasury otherwise than on cheques taken from a cheque book issued by the treasury and signed by the duly authorized officer of each fund, e.g., the president of a local board and the executive authority of a municipal council. No local fund cheque shall be paid, unless the balance at the credit of the fund is sufficient to cover the payment.

NOTE 1—

The account of a local fund at the treasury is Purely a banking account, and the nature of the disbursement need not be specified on any local fund cheque.

NOTE 2—

When the executive authority or other officer of a municipal council who is authorized to draw cheques against the funds of the municipal council lodged with the Government, makes over charge of his office either temporarily or permanently, he should send a specimen of the relieving officer’s signature together with a certificate in Form T.R. 78 to the Treasury Officer.

NOTE 3—

When the president or other officer of a local body who is authorized to draw cheques against the funds of the local body lodged with the Government makes over charge of his office either temporarily or permanently he should send a specimen of the relieving officer’s signature together with a certificate in Form T.R. 78 to the Treasury Officer:

Provided that when the functions of the president devolve on the vice-president under the provisions of any enactment under which the local body is constituted, it shall not be necessary for the president to send the specimen of the relieving officer’s signature and the certificate mentioned in his rule if they have been sent to the Treasury Officer on a previous occasion, but the president shall, in every such case report the fact of such devolution of powers on the vice-president, mentioning the latter by name.

249. Time expired cheques.—

If a cheque, the currency of which has expired owing to its not being presented at the treasury for payment within three months from the date of issue, is returned to the drawing officer, he shall destroy it and may then draw a new cheque in place of it, if necessary. He shall record on the counterfoil of the old cheque the fact that the cheque has been destroyed and the number and date of the new cheque and shall enter on the counterfoil of the new cheque the number and date of the old one.

250. Lost cheques.—

When a drawing officer receives a report that a cheque drawn by him has been lost, he shall at once report the fact to the Treasury Officer and request him to stop payment of the cheques. The Treasury Officer shall at once examine the lists of paid cheque and, if he finds that the cheque has not been paid take steps to stop payment. A board showing the particulars of all “stopped” cheques shall be hungs up before the clerk concerned. The Treasury Officer shall also send the drawing officer a certificate in the accompanying form, when a cheque reported as lost has not been paid and he has stopped payment:—

“Certified that cheque No……………..…… dated…………… for `……………………… reported by the ……………….. (drawing officer) to have been drawn by him on this treasury in favour of ………………………………………… has not been paid and will not be paid, if presented hereafter………………………….treasury,……………………..……… The……………………………20……………. Treasury Officer”.

On receipt of the certificate duly signed by the Treasury Officer the drawing officer shall cancel the original cheque and make the necessary entries in his accounts and may then issue another in its place.

If any “stopped” cheque is presented at the treasury for payment the clerk concerned shall at once bring the fact to the notice of the Treasury Officer and the latter shall refuse payment and return the cheque to the person who presented it with the words “payment stopped” written across it.

NOTE—

*If the currency of a cheque expires on Saturday, the Treasury Officer shall also verify the list of cheques paid for the subsequent working day of the Bank before the issue of non-payment certificate, wherever necessary.

251. Cancelled cheques.—

The drawing officer shall cancel any cheque which has remained unpaid for twelve months from the date of issue. When a cheque is cancelled for any reason, the fact shall be recorded on its counterfoil and the cheque, if in the drawing officer’s possession, shall be destroyed. If the cheque is not in his possession and payment has not already been stopped under the preceding rule, he shall at once request the Treasury Officer to stop payment of the cheque. If the Treasury Officer then finds that the cheque has not been paid, he shall stop payment and send the drawing officer a certificate in the manner prescribed in the preceding rule.

252. (a) Cheque books required by the officers of Government and administrators of the personal deposit accounts, local fund accounts or any other fund are printed by the Superintendent, Government Presses. All supplies of cheque book forms should be made by Treasury Officers who will receive their supply from the Government Press. The Treasury Officers should examine the cheque book forms carefully on receipt and count the number of forms in each book. They should keep the cheque books in their stock and issue them one by one as books are used up. Every Treasury Officer should ascertain the requirements in his district and send a consolidated indent to the Superintendent, Government Presses, Trivandrum.

NOTE 1—

The Treasury Officers should examine carefully, on receipt the unused cheque books or blank cheque forms returned to them by drawing officers, count the number of forms in each book, check them with reference to the advice of return sent by the drawing officers (See note under Rule 253) and keep them safely in stock.

NOTE 2—

The stock of cheque books which have become obsolete and used and unused cheque books returned to the Treasury by the drawing officers shall be destroyed under the orders of the Director of Treasuries. The period prescribed in Article 358, Kerala Financial Code shall also be satisfied in the matter of destruction of counterfoils of used cheque books. The destruction shall be done by incineration=ജ്വലനം in the presence of the Deputy Director duly authorised by the Director of Treasuries. The fact of destruction shall also be recorded in the concerned stock register under the attestation of the Treasury Officer and the Deputy Director in whose presence the destruction is conducted.

(b) A drawing officer who requires a fresh cheque book should sign and send to the Treasury Officer the printed requisition form inserted towards the end of each cheque books. The Treasury Officer should then supply a cheque book if the request is in order, but he should never supply more than one cheque book on a single requisition form. He should examine every cheque book again at the time of issue and should be careful to see that it is duly and promptly acknowledged. *He should issue the cheque book only after signing an endorsement on the following lines on the requisition slip presented by the drawing officer, namely:—

Cheque book with leaves bearing numbers from………….………to…………………issued to………………… on ………….. (Dated Signature) District/Sub Treasury Officer Place……………………..

A drawing officer should invariably keep the cheque book supplied to him in his personal custody under lock and key. Whenever a drawing officer hands over charge of his office, a note should be recorded over the signature of both the relieved and the relieving government servants showing the number of cheque books and unused cheques handed over. The note should be made in the cash book or other permanent register in which the expenditure for which cheques are drawn is recorded.

If a cheque book or a blank cheque form is lost, the drawing officer should, at once, inform the Treasury Officer, furnishing the numbers of the lost cheque forms. The Treasury Officer should then stop payment of all cheques drawn on forms bearing any of those numbers.

NOTE—If a drawing officer has to return to the Treasury Officer unused cheque books or blank cheque forms, he should examine them carefully, before sending them by registered post to the Treasury Officer by name and should take care to see that they are duly and promptly acknowledged. A separate advice of despatch of the cheque books or forms giving full details of numbers of the cheque books and cheque forms should also be sent to the Treasury Officer simultaneously.

254. Whenever a Government servant sends a cheque to the treasury for payment, not in cash, but by transfer credit in the treasury accounts, he should endorse on it the words “Received payment by transfer credit to ………………..” and sign below them. Failure to do this would facilitate criminal misappropriation of the amount. The treasury should enter in the number book every cheque that is to be paid by transfer in whole or in part.

NOTE—

When cheques are presented by Departmental Officers for adjustment in Treasury accounts or for collection, they shall present the cheques with a covering list in duplicate and the Treasury Officer, in turn, shall return one copy to the Departmental Officer as acknowledgment.

When a pass book or list of cheques cashed (Form T.R. 79) is maintained for any banking or drawing account at the treasury, it should remain in the custody of the drawing officer, except when it is sent periodically to the Treasury Officer to be written up. Ordinarily the drawing officer should send it to be written up at least once a month. On receipt of the pass book, the Treasury Officer should have the amount of each paid cheque recorded in it with reference to the registers maintained in the treasury and (in regard to cheques paid at the Bank or at a sub-treasury) the daily sheets. The cheque book number and distinguishing letter, if any, as well as the individual cheque number should be shown for each cheque entered in the pass book. The Treasury Officer should ordinarily return the pass book to the drawing officer the same day.

256.. When a cheque is drawn on a treasury or sub treasury for a refund of revenue and the amount is to be remitted by money order, the payment to the Post Office should be made by a separate cheque drawn on the treasury or sub treasury in favour of the Postmaster.

257. A Land Acquisition Officer may, under the orders of the Government make all or any of his payments by issuing cheques on the treasury, provided that the property is not so far from the treasury that this method of payment would cause undue inconvenience to the payees. The rules prescribing the procedure for the payment of compensation for land acquired under the Land Acquisition Act should be strictly adhered to in respect of such payments.

257A. Letters of credit.—(1) When under the provision of this rule or under any special order of Government a letter of credit is issued in favour of a drawing officer, such letter of credit shall specify the maximum amount upto which the officer credited shall have authority to draw on the particular Treasury on which the letter of credit has been issued.

(2) A drawing officer in whose favour a letter of credit has been issued is not permitted to draw the whole amount and place it in a separate drawing account at the Treasury or the Bank or in a private account.

B. Special to cheque drawing departments mentioned in sub rule (d) of rule 162,

258 (a) The Treasury Officer shall pay claims relating to # the department specified in sub-rule (d) of rule 162 including those of pay and allowances and contingencies, on cheques drawn by an officer of the Department concerned (or a Government Servant of some other department acting as disburser of the department) whom the Accountant General has placed in account with the treasury.

(b) The Accountant General shall ordinarily place each Divisional Officer in account with one or more District Treasuries within his jurisdiction for the purpose of drawing cheques and may when necessary, place other officers of the departments in account with District Treasuries within their respective jurisdiction for the same purpose.

(c) An Officer who is authorised to draw cheques on one District Treasury may also, when necessary, draw cheques on any sub treasury subordinate to it.

(d) A Divisional Officer may authorize any Sub Divisional Officer working under him to draw cheques against his own account with a District Treasury (including Sub treasuries under it). No separate accounts shall be opened for a Sub Divisional Officer so authorised. When the Divisional Officer has issued the necessary letter of authority, the cheques drawn and paid under it shall be charged to his account as if drawn by himself.

(e) Letters of credit specifying the monthly limits of drawals on Treasuries shall be issued by Government in the Finance Department to the Divisional Officers in # the department specified in sub-rule (d) of rule 162 , and Divisional Officer shall restrict the drawals from the Treasury to the limits prescribed in the letter of credit. It shall be the responsibility of the Treasury Officer to ensure that cheques issued in excess of the permitted limits are not cashed #but are returned uncashed.

(f) The Finance Department shall issue letters of credit of each Divisional Officer with copies to the Head of the Department, Circle Officer, Divisional Officer and the District Treasury Officer. Letters of credit shall be issued at a time for every subsequent three months. The Divisional Officers shall further distribute their allotments among the various subordinate officers including himself to the extent necessary and intimate the concerned sub treasuries of the distribution. The treasury shall maintain a register in Form T.A 10 to note the credit limits allowed to each officer and regulate the encashment of cheques on the basis of letters of credit.

(g) If found necessary the Circle Officer/Divisional Officer shall make reallocation of the allotments of the divisions in his jurisdiction in a month subject to the condition that the total allotment for all the divisions in that circle/sub division in the division in the months is not exceeded. The officers making reallocation shall promptly intimate the details of such allocations to the Head of the Departments, Finance Department and the concerned Treasuries. The total credit of Public Works Department Stores for each quarter shall be allotted to the Executive Engineer, Public Works Department Stores and he is authorised to distribute the credits to the various District Stores on different treasuries according to requirements. He is also empowered to exercise the powers of circle office so far as the system of letters of credit is concerned.

(h) The Divisional Officers are authorised to carry forward unutilized amounts under the letters of credit from month to month as well as from quarter to quarter. However, the Sub Divisional Officers shall carry over the unutilized balance of the month allotted for a particular treasury in that treasury itself after giving specific requisition to the Treasury Officer concerned unless the Divisional Officer concerned has not given any intimation to the contrary. In such cases the Sub Divisional Officer shall intimate such carrying over to his Divisional Officer promptly. If for any unavoidable reasons the limit allowed for a month has to be exceeded, the Divisional Officers are permitted to make excess drawal up to 20 per cent of the credit limit for that month, provided such excess is adjusted in the remaining months of that quarter. In case of Divisional Officer is exceeding the monthly limit in the above manner, he shall promptly report the fact to the superior officers in the Department to the Finance Department and to the concerned treasury simultaneously, indicating how he proposes to adjust the excess.

(i) If a Divisional Officer is authorised to draw from more than one District Treasury, credit limits to the drawing on each District Treasury shall be proposed and fixed separately.

(j) The following items shall be kept outside the purview of the letters of the credit for the Present, namely:—

(i) salaries and wages;

(ii) refund of deposits (earnest money, security and retention money);

(iii) cheques issued to works relating to National Highways debited to Central allocations, etc.; (iv) disbursement on Provident Fund Accounts, payment of scholarships and Life Insurance Premia; and

(v) wages to the N.M.R. workers.

(k) The items specified in sub-rule (j) shall be distinguished by affixing rubber stamps on the cheques drawn under each of the items under the attestation of the Drawing Officer. The requirements of the funds for other purposes shall be aggregated and the limit fixed for the total. Encashment of all cheques representing non-exempted items shall be watched against the credit limit, by the concerned departmental authorities.

(l) Cheques issued on or before the last day of March which are cashed in April and subsequent months shall not be taken against the credit limit for the months of encashment since the expenditure relates to the appropriation for the previous financial year. The Director of Treasuries shall obtain from the treasuries, statement of cheques issued in the previous year but paid in the subsequent financial year and furnish it to the Finance Department on or before 31st July of each financial year.

NOTE—

The cheques drawn under letters of credit system shall be presented at the treasury concerned even if such treasury conducts its cash transactions through the Banks and the Treasury Officer shall verify the availability of credit and enface on them an order to Bank to pay the amount, if any, which he finds to be properly payable.

Rules 259 to 262 [Omitted]

263. Before a drawing officer of # any of the departments mentioned in sub-rule (d) of rule 162 brings a cheque book into use, he should mark all the cheque forms in it with distinguishing letter. The letter marked on the cheques in a cheque book which is to be used by a particular drawing officer for drawing cheques on a particular treasury should be different from the letters marked on cheques drawn by other drawing officers of the division on that treasury and also from those marked on cheques drawn by himself on other treasuries.

264. A drawing officer should ordinarily send the advice to a sub treasury regarding a cheque book to be brought into use for drawing cheques on it (See Rule 24 of part I) through the district treasury; if it needs to be sent urgently, he may send it direct to the sub treasury and forward a copy simultaneously to the district treasury.

265 The Treasury Officer should send quarterly to each Divisional Officer a statement showing the numbers and dates of all public works cheque books issued on requisitions received from Divisional Officers.

266.When the headquarters of all the subdivisions are at the headquarters of the division, the Divisional Officer should send his pass book to the treasury to be written up at the end of each month. When that condition is not fulfilled, he should send it twice a month, namely, on the 10th and at the end of each month. A Divisional Officer who has banking accounts with more than one district treasury should have a separate pass book for the account with each of them. The identity and the amount of the cheques entered as cashed should be examined at the earliest opportunity, the pass book being initialled, (and dated) by the Divisional Accountant in token of the check.

CHAPTER II

SPECIAL RULES FOR DRAWAL OF CHEQUES WHEN THE TREASURY

TRANSACTS ITS CASH BUSINESS

THROUGH THE BANK

Rules applicable to Departments generally

267. Cheques.—

The rules contained in rules 239 to 251 shall apply mutatis mutandis to cheques drawn by government servants on the Bank where the treasury transacts its cash business through it except that every correction or alteration in a cheque drawn on the Bank shall be attested by the full signature of the government servant who signs it. When such cheques are presented at the Bank direct in accordance with the rules without the pay order of the officer-in-charge of the treasury the Bank shall see that the relevant rules are duly observed. When a cheque drawn by a government servant on the Bank is, in accordance with the rules, first presented at the treasury before it is presented for payment at the Bank, the Treasury Officer shall examine it and enface on it an order to the Bank to pay the amount, if any, which he finds to be properly payable.

Explanation.—

*Cheques drawn by Government Servants in #the departments mentioned in sub-rule (d) of rule 162 in respect of item kept outside the purview of the letters of credit referred to in sub-rule(j) of rule 258, may be presented at the bank direct for payment and no pay order of the Treasury or Sub Treasury Officer is necessary. Similarly cheques drawn on the personal deposit accounts and the banking accounts of local funds which, are maintained by the Bank, may be presented at the Bank direct for payment without the pay order of the Treasury or Sub Treasury Officer. Rules 208 and 248 should be observed mutatis mutandis in regard to withdrawals from these accounts. All other cheques drawn by government servants shall first be presented at the treasury and Bank shall make payment only on the pay order of the officer-in-charge of the treasury.

NOTE 1.—

Cheques.—Rules 248 to 266 above apply mutatis mutandis to cheques drawn by government servants on the Bank where the treasury business is transacted through it. The specimen signature and certificates mentioned in notes 2 and 3 under rule 248 should be sent to the Bank, when the cheques are drawn on the Bank.

NOTE 2.—

Lost cheques.—The provisions of rules 250 and 253 should be observed mutatis mutandis in regard to cheques drawn by departmental officer on the Bank direct. When such a cheque is lost, the loss of the cheque will be reported by the drawing officer to the officer of the Bank who will issue an acknowledgment to him. This acknowledgment would imply that the Bank will take the necessary precautions against payment of the cheque if presented thereafter. The drawing officer will then advise the Treasury Officer that the acknowledgment has been received by him from the Bank. On the basis of the receipt on such advice, the Treasury Officer, will verify his records and if no payment has been made, he will issue the certificate on non-payment to the drawing officer.

267A. Letters of credit.—

If the Drawing Officer in whose favour a letter of credit is issued requires funds both at the headquarters and at a sub treasury, the Treasury Officer shall provide funds at the sub treasury also.

268. [Deleted]

269. [Deleted]