Rule 19 of the General Financial Rules 2017 Submission of returns of revenue
Original Rule Text
Visual Summary
Certain government departments must submit an annual statement about forgiven revenues.
Only individual revenue forgiveness of Rs. 1,000 or more needs to be included in the report.
The statement must be submitted annually on the 1st of June to the Audit and Accounts Officers.
Reports must classify forgiven amounts by reason, provide a total for each class, and include a brief explanation.
Executive Summary
This rule establishes a mandatory annual reporting requirement for most Central Government departments. They must submit a statement by June 1st each year to the Audit and Accounts Officers, detailing all instances where they have forgiven revenue or dropped claims of Rs. 1,000 or more during the previous year. The report must categorize these actions by reason, provide a total amount for each category, and include a brief explanation for each category.
In-Depth Analysis of the Rule
Introduction
Rule 19 of the General Financial Rules, 2017, focuses on transparency and accountability in government finances. When the government decides not to collect money it is owed, this rule ensures that these decisions are officially recorded and reported. This process helps maintain financial discipline and allows for proper oversight by audit authorities.
Breakdown of the Rule
The rule is divided into two main parts:
Part 1: The Reporting Requirement
This part outlines who needs to report, what they need to report, when, and to whom.
- Who Reports: Most Departments of the Central Government, Administrators, and Heads of Departments. The Department of Posts is specifically excluded.
- What to Report: A statement of ‘remissions of revenue’ (forgiving money owed, like a tax or fee) and ‘abandonment of claims’ (deciding not to pursue a debt). This only applies to decisions made using discretionary powers, not those required by a specific law.
- The Threshold: A key detail is that individual remissions or abandonments below Rs. 1,000 do not need to be included. This is to avoid cluttering the report with minor amounts.
- When and to Whom: The statement must be submitted annually on June 1st to both the Audit Officer and the Accounts Officer.
Part 2: The Content and Format of the Report
This part specifies how the information should be presented in the statement.
- Classification: All reported items must be grouped (classified) based on the reason (‘grounds’) for the forgiveness. For example, there might be a class for ‘financial hardship of the debtor’ or ‘impracticality of collection’.
- Totaling: For each class or category, a total monetary figure must be provided.
- Explanation: A brief explanation of the circumstances for each class must be included. This gives context to the numbers and helps the audit officers understand the rationale behind the decisions.
Practical Example
Imagine the Department of Agriculture has a program where it leases out small plots of land to farmers. In the last year, due to a severe drought, the Head of the Department used their discretionary power to forgive the lease payments for several farmers.
- Farmer A’s lease was Rs. 5,000.
- Farmer B’s lease was Rs. 8,000.
- Farmer C’s lease was Rs. 900.
When preparing the annual statement under Rule 19, the department would:
- Include the remissions for Farmer A and Farmer B because they are over Rs. 1,000.
- Exclude the remission for Farmer C as it is below the threshold.
- Create a class, perhaps titled ‘Remission due to agricultural distress’.
- The total figure for this class would be Rs. 13,000 (5,000 + 8,000).
- Add a brief explanation, such as ‘Lease payments were remitted for farmers in drought-affected areas to provide financial relief’.
This statement would then be sent to the Audit and Accounts Officers by June 1st.
Conclusion
Rule 19 is a procedural but crucial rule for financial oversight. It ensures that significant decisions to forgo government revenue are not made in a vacuum. By requiring a structured, annual report, it creates a clear paper trail for auditors, promoting transparency and ensuring that discretionary powers are exercised responsibly.
Related Provisions
Understanding Rule 19 is enhanced by looking at related rules that provide context for the actions being reported:
- Rule 18: Remission of Revenue – This rule establishes the principle that revenue claims can only be remitted or abandoned with the sanction of a competent authority. Rule 19 then details how these sanctioned remissions must be reported.
- Rule 20: Departmental rules for remission and abandonment of revenue – This rule allows departments to create their own specific rules for defining what constitutes a remission or abandonment for the purpose of reporting under Rule 19, providing a framework for consistent classification.
Learning Aids
Mnemonics
- JUNE 1st REPORT: Remember ‘Just Understand Numbers Exceeding 1k Require Explanation, Properly Organized, Reported Today’. This covers the date (June 1st), the threshold (Rs. 1000), and the need for classification and explanation.
- The 3 C’s of Rule 19 Reporting: Remember to Classify (by reason), Calculate (the total for each class), and Clarify (with a brief explanation).
Mindmap
Multiple Choice Questions (MCQs)
1. What is the deadline for submitting the annual statements on revenue remissions?
- A) March 31st
- B) April 1st
- C) June 1st
- D) December 31st
Show Answer
Correct Answer: C) June 1st. The rule explicitly states that the statements shall be submitted annually on the 1st of June.
2. An individual remission of revenue must be included in the annual statement if its value is:
- A) Rs. 999
- B) Rs. 1,000 or more
- C) Any amount, as all remissions must be reported
- D) More than Rs. 1,000
Show Answer
Correct Answer: B) Rs. 1,000 or more. The rule states that remissions ‘below Rupees one thousand need not be included’, which means amounts of Rs. 1,000 and above must be included.
3. According to Rule 19(2), what specific information is required for each *class* of remission in the statement?
- A) The name of the officer who sanctioned the remission.
- B) A detailed audit report for each individual case.
- C) A total figure for the class and a brief explanation of the circumstances.
- D) Only the total monetary figure for that class.
Show Answer
Correct Answer: C) A total figure for the class and a brief explanation of the circumstances. Rule 19(2) explicitly requires both a total figure for each class and a brief explanation of the circumstances leading to the remission for that class.
Frequently Asked Questions
Does this rule apply to every single government department?
No. The rule applies to most Central Government Departments, Administrators, and Heads of Departments, but it specifically excludes the Department of Posts.
What if a department forgives a debt of Rs. 500? Does it need to be reported?
No. The rule provides a threshold. Any individual remission or abandonment of a claim that is less than Rs. 1,000 does not need to be included in the annual statement.
What is the purpose of classifying the remissions by ‘grounds’?
Classifying the remissions by the reason they were granted (e.g., financial hardship, administrative error, etc.) helps the audit and accounts officers to understand the patterns and rationale behind the decisions to forgo revenue. It provides a clearer picture of financial management within the department.
Key Takeaways
- An annual report on forgiven government revenue is mandatory for most departments.
- The report is due on June 1st each year and must be sent to both the Audit Officer and the Accounts Officer.
- Only instances of forgiven revenue amounting to Rs. 1,000 or more must be included.
- The report must group the forgiven amounts by reason, provide a total for each group, and include a short explanation.