Rule 246 of The General Financial Rules 2017 Loans of Public Moneys
Original Rule Text
Visual Summary
Rules apply to all competent authorities.
Covers State, UT, local bodies, foreign govts, institutions.
Governs the sanctioning of public money loans.
Executive Summary
Rule 246 of the General Financial Rules, 2017 outlines the fundamental principles for all authorities responsible for sanctioning loans of public moneys. It specifies that these rules must be adhered to when providing loans to a wide array of entities, including State Governments, Union Territory local administrations, local bodies, foreign governments (based on State Government recommendations), government institutions, and other government bodies. The rule emphasizes the broad applicability of these financial guidelines across various governmental and quasi-governmental loan disbursements.
In-Depth Analysis of the Rule
Introduction: Rule 246 serves as a foundational directive within the General Financial Rules, 2017, establishing the scope and applicability for the sanctioning of public money loans. It mandates that all competent authorities involved in such financial disbursements must strictly adhere to the subsequent rules detailed in this section.
Breakdown of the Rule:
- Universal Application: The rules in this section are binding on all authorities competent to sanction loans. This ensures a standardized approach across different governmental levels and departments.
- Broad Spectrum of Loanees: The rule explicitly lists the types of entities that can receive public money loans under these guidelines:
- State Governments
- Local Administrations of Union Territories
- Local Bodies
- Foreign Governments (specifically when recommended by a State Government)
- Government Institutions
- Other Government Bodies
- Focus on Public Moneys: The core subject is the sanctioning of “loans of public moneys,” underscoring the importance of prudent financial management when public funds are disbursed as loans.
Practical Example: Imagine the Ministry of Finance is considering a loan request. Rule 246 immediately directs them to follow the specific procedures and conditions laid out in the subsequent rules of this section, regardless of whether the loan is for a State Government’s infrastructure project or a local body’s development initiative. If a foreign government seeks a loan, it must first be recommended by an Indian State Government to fall under these rules.
Related Provisions
To understand the broader context of loan management within the General Financial Rules, 2017, consider these related provisions:
- Rule 247 (1) of The General Financial Rules 2017 Powers and Procedure for Sanction of Loans
- Rule 249 (1) of The General Financial Rules 2017 Terms and Conditions of Loans
- Rule 250 (1) of The General Financial Rules 2017 General Conditions for Regulating All Loans
Learning Aids
Mnemonics
- LOANS I: Loans Out to All Nations, States, Institutions. This helps remember the broad categories of entities to whom loans can be sanctioned.
Process Flowchart
Multiple Choice Questions
1. What is the primary scope of Rule 246 of the General Financial Rules, 2017?
- A) Regulating inter-departmental adjustments
- B) Governing the destruction of office records
- C) Establishing principles for sanctioning public money loans
- D) Defining capital and revenue expenditure
Show Answer
Correct Answer: C
2. According to Rule 246 of the General Financial Rules, 2017, which of the following entities can receive loans of public moneys?
- A) Only Central Government Ministries
- B) Private individuals and corporations exclusively
- C) State Governments, Local Administrations of Union Territories, and foreign Governments
- D) Only Public Sector Undertakings
Show Answer
Correct Answer: C
3. Rule 246 of the General Financial Rules, 2017 mandates that its rules must be observed by:
- A) Only the Ministry of Finance
- B) All authorities competent to sanction loans of public moneys
- C) Only the Comptroller and Auditor General
- D) Heads of Departments for contingent expenditure
Show Answer
Correct Answer: B
4. Under Rule 246 of the General Financial Rules, 2017, a foreign Government can receive a loan of public moneys if:
- A) It is approved by the President of India directly
- B) It is on specific recommendation of a State Government
- C) It is for a project jointly executed with the Central Government
- D) It is for humanitarian aid only
Show Answer
Correct Answer: B
5. The “public moneys” referred to in Rule 246 of the General Financial Rules, 2017 primarily relate to:
- A) Funds from private donations
- B) Funds managed by autonomous bodies without government oversight
- C) Funds belonging to the Government that are disbursed as loans
- D) Revenues collected from user charges only
Show Answer
Correct Answer: C
Frequently Asked Questions
Who is required to observe the rules laid down in Rule 246 of the General Financial Rules, 2017?
Rule 246 mandates that all authorities competent to sanction loans of public moneys must observe the rules outlined in this section.
To which entities can loans of public moneys be sanctioned under Rule 246 of the General Financial Rules, 2017?
Loans can be sanctioned to State Governments, Local Administrations of Union Territories, local bodies, foreign Governments (on specific recommendation of a State Government), Government institutions, and other Government bodies.
Does Rule 246 of the General Financial Rules, 2017 apply to loans given to private individuals?
No, Rule 246 specifically lists governmental and quasi-governmental entities as recipients. Loans to private individuals are not covered by this rule.
Key Takeaways
- Rule 246 establishes the foundational requirement for all competent authorities to follow specific rules when sanctioning public money loans.
- It broadly defines the eligible recipients of these loans, including various levels of government and related institutions.
- The rule highlights the importance of structured financial management for public fund disbursements.
- Foreign governments can receive loans, but only upon the specific recommendation of a State Government.
Conclusion
Rule 246 of the General Financial Rules, 2017 is a pivotal provision that sets the stage for responsible and regulated disbursement of public funds as loans. By clearly defining the scope of its application and the diverse range of eligible recipients, it ensures that all financial transactions involving public moneys are conducted with due diligence and adherence to established financial propriety. This rule is fundamental to maintaining financial order and accountability across various governmental and quasi-governmental operations.