Rule 57 of The General Financial Rules 2017 Control of Expenditure

Rule 57 of The General Financial Rules 2017 Control of Expenditure

Original Rule Text

Rule 57 (1) Responsibility for control of Expenditure. The Departments of the Central Government shall be responsible for the control of expenditure against the sanctioned grants and appropriations placed at their disposal. The control shall be exercised through the Heads of Departments and other Controlling Officers, if any, and Disbursing Officers subordinate to them.Rule 57 (2) A Grant or Appropriation can be utilised only to cover the charges (including liabilities, if any, of the past year) which are to be paid during the financial year of the Grant or Appropriation and adjusted in the account of the year. No charges against a Grant or Appropriation can be authorized after the expiry of the financial year.Rule 57 (3) No expenditure shall be incurred which may have the effect of exceeding the total grant or appropriation authorized by Parliament by law for a financial year, except after obtaining a supplementary grant or appropriation or an advance from the Contingency Fund. Since voted and charged portions as also the revenue and capital sections of a Grant/Appropriation are distinct and re-appropriation inter se is not permissible, an excess in any one portion or section is treated as an excess in the Grant/Appropriation.Rule57(4) To have effective control over expenditure by the Departments, Controlling and Disbursing Officers subordinate to them shall follow the procedure as given below: -(i) For drawal of money, the Drawing and Disbursing Officer shall (a) Prepare and present bills for “charged” and “voted” expenditure separately. (b) Enter on each bill the complete accounts classifications from major head down to the object head of account. When a single bill includes charges falling under two or more object heads, the charges shall be distributed accurately over the respective heads. (c) Enter on each bill the progressive total of expenditure up-to-date under the primary unit of appropriation to which the bill relates, including the amount of the bill on which the entry is made.(ii) All drawing and disbursing officers shall maintain separate registers in Form GFR 5, physically or electronically for allocation under each minor or sub-head of account with which they are concerned.(iii) On the third day of each month, a copy of the entries made in this register during the preceding month shall be sent by the officer maintaining it, to the Head of the Department or other designated Controlling Officer. This statement shall also include adjustment of an inward claim, etc., communicated by Pay and Accounts Officer directly to the DDO (and not to his Grant Controlling Officer). If there are no entries in the register in any month, a ‘nil’ statement shall be sent.(iv) The Controlling Officer will maintain a broadsheet in Form GFR 6 to monitor the receipt of the return prescribed in the foregoing sub- clause(v) On receipt of the returns from Disbursing Officers, the Controlling Officer shall examine them and satisfy himself: (a) that the accounts classification has been properly given; (b) that progressive expenditure has been properly noted and the available balances worked out correctly; (c) that expenditure up-to-date is within the grant or appropriation; and (d) that the returns have been signed by Disbursing Officers. Where the Controlling Officer finds defects in any of these respects, he shall take steps to rectify the defect.(vi) When all the returns from the Disbursing Officers for a particular month have been received and found to be in order, the Controlling Officer shall compile a statement in Form GFR 7, in which he shall incorporate – (a) the totals of the figures supplied by Disbursing Officers; (b) the totals taken from his own registers in Form GFR 5; (c) the totals of such adjustments under the various detailed heads as communicated to him by the Accounts Officer on account of transfer entries and expenditure debited to the grant as a result of settlement of inward account claims and not reckoned by his DDOs.(vii) If any adjustment communicated by the Accounts Officer affects the appropriation at the disposal of a subordinate Disbursing Officer, the fact that the adjustment has been made shall be communicated by the Controlling Officer to the Disbursing Officer concerned.(viii) On receipt of all the necessary returns, the Head of the Department shall prepare a consolidated account in Form GFR 8, showing the complete expenditure from the grant or appropriation at his disposal upto the end of the preceding month.Rule 57 (5) The Head of the Department and the Accounts Officer shall be jointly responsible for the monthly reconciliation of the figures given in the accounts maintained by the Head of the Department with those appearing in the Accounts Officer’s books. The procedure for reconciliation shall be as follows: -(i) DDOs shall maintain a Bill Register in Form TR 28-A, and note all bills presented for payment to the PAO in the register. As soon as cheques for the bills presented for payment are received, and/or status of e-payments are verified from the reports available with DDO on PFMS portal these shall be noted in the appropriate column of the Bill Register and the DDOs shall ensure that the amounts of cheques tally with the net amount of the bills presented. In case any retrenchment is made by the PAO, a note of such retrenchments shall be kept against the bill in the remarks column in TR 28-A.(ii) The PAOs shall furnish to each of the DDOs including Cheque –drawing DDOs, an extract from the expenditure control register or from the Compilation Sheet every month indicating the expenditure relating to grants controlled by him classified under the various major-minor detailed head of accounts. The statements for May to March shall also contain Progressive Figures.(iii) On receipt of these extracts from the PAOs, the DDOs shall tally the figures received, excluding book adjustments, with the expenditure worked out for the month in the GFR 5 register. Discrepancies, if any, between the two sets of figures shall be promptly investigated by the DDO in consultation with the PAO. He shall also note in the GFR 5 register particulars of book adjustments advised by the PAO through the monthly statement. Thereafter, the DDO shall furnish to the PAO a certificate of agreement of the figures as per his books with those indicated by the PAOs by the last day of the month following the month of accounts.(iv) The Principal Accounts Officer (or PAO wherever payments, relating to a grant are handled wholly by a PAO) of each Ministry, shall send a monthly statement showing the expenditure vis-à-vis the Budget provision under the various heads of accounts, in the prescribed pro forma, to the Heads of Departments responsible for overall control of expenditure against grant of the Ministry as a whole. The figures so communicated by the Principal Accounts Officer (or the PAO concerned) shall be compared by the Heads of Departments with those consolidated in Form GFR 8 and differences, if any, shall be taken up by the Heads of Departments with the Principal Accounts Officers (or the PAO concerned) for reconciliation. The Head of the Department shall furnish a quarterly certificate to the Principal Accounts Officer certifying the correctness of the figures for the quarter by the 15th of the second following month after the end of quarters April-June, July-September, October-December and January- March.Rule 57 (6) The Departments of the Central Government shall obtain from their Heads of Departments and other offices under them the departmental figures of expenditure in Form GFR 8 by the 15th of the month following the month to which the returns relate. The figures relating to Revenue and Capital expenditure shall be separately shown in these returns. The information so obtained shall be posted in register(s) kept for watching the flow of expenditure against the sanctioned grant or appropriation. Progressive totals of expenditure shall be worked out for the purpose. If the departmental figures obtained in Form GFR 8 and posted in the register(s), require correction in a subsequent month, Heads of Departments or other offices shall make such corrections by making plus or minus entries in the progressive totals. In case the Accounts Office figures which subsequently become available are found to be higher than departmental figures, the former shall be assumed to be the correct figures, as appropriation accounts are prepared on the basis of the figures booked in the accounts.Rule 57 (7) The Departments of Central Government shall also obtain from the Heads of Departments and other authorities under them, statements showing the details of the physical progress of the schemes for which they are responsible. This statement shall show the name of the scheme, the Budget provision for each scheme, the progressive expenditure on each scheme, the progress of the scheme in physical terms and the detailed reasons for any shortfalls or excess, both against physical and financial targets.Rule 57 (8) A Broadsheet in Form GFR 9 shall be maintained by the Departments of Central Government or each Head of Department and other authorities directly under them, to watch the prompt receipt of the various returns mentioned above from month to month and to take necessary measures for rectifying any defaults noticed.

Visual Summary

Departmental Responsibility

Central Government Departments control expenditure against sanctioned grants.

Financial Year Limit

Grants are for charges paid within the specific financial year only.

No Exceeding Grants

Expenditure must not exceed authorized grants without supplementary approval.

Executive Summary

Rule 57 of the General Financial Rules, 2017, outlines the comprehensive framework for expenditure control within Central Government Departments. It mandates that departments are responsible for managing spending against sanctioned grants, ensuring funds are utilized strictly within the designated financial year. The rule prohibits exceeding total authorized grants without obtaining supplementary approvals or advances from the Contingency Fund, emphasizing that distinct portions of a grant (voted/charged, revenue/capital) cannot be re-appropriated. It details a meticulous procedure for Drawing and Disbursing Officers (DDOs) and Controlling Officers (COs) for bill processing, register maintenance, and monthly reporting, culminating in a joint reconciliation process between the Head of Department and the Accounts Officer to ensure financial accuracy and adherence to budgetary allocations.

In-Depth Analysis of the Rule

Rule 57 establishes the bedrock of financial discipline for Central Government expenditure. It ensures that public funds are spent responsibly, transparently, and in strict accordance with parliamentary authorizations.

Breakdown of the Rule
  • Rule 57(1) – Responsibility for Control of Expenditure: Central Government Departments bear the primary responsibility for controlling expenditure against their sanctioned grants. This control is delegated through a hierarchy of Heads of Departments, Controlling Officers, and Disbursing Officers.
  • Rule 57(2) – Utilization Period: A grant or appropriation can only be used to cover charges, including past liabilities, that are paid and adjusted within the specific financial year. No expenditure can be authorized after the financial year’s end.
  • Rule 57(3) – Prohibition on Exceeding Grants: Expenditure must not exceed the total grant authorized by Parliament unless a supplementary grant, appropriation, or an advance from the Contingency Fund is obtained. It clarifies that voted and charged portions, as well as revenue and capital sections, are distinct, and an excess in any one is considered an overall excess.
  • Rule 57(4) – Procedure for Effective Control: This sub-rule details the operational steps for DDOs and COs. DDOs must prepare bills with full account classifications, maintain GFR 5 registers, and send monthly returns to COs. COs, in turn, monitor these returns using GFR 6 broadsheets, examine them for accuracy, and compile GFR 7 statements. The Head of Department then prepares a consolidated GFR 8 account.
  • Rule 57(5) – Monthly Reconciliation: The Head of Department and the Accounts Officer are jointly responsible for reconciling their expenditure figures monthly. DDOs maintain Bill Registers (TR 28-A), PAOs provide expenditure extracts, and DDOs reconcile these with their GFR 5 registers, reporting discrepancies and providing certificates of agreement. PAOs then send monthly statements to HODs for overall reconciliation and quarterly certification.
  • Rule 57(6) – Departmental Figures and Corrections: Departments obtain GFR 8 figures from their HODs, post them in registers, and make corrections as needed. If Accounts Office figures are higher, they are assumed correct for appropriation accounts.
  • Rule 57(7) – Physical Progress Monitoring: Departments must also obtain statements on the physical progress of schemes, detailing budget provisions, progressive expenditure, physical achievements, and reasons for any shortfalls or excesses.
  • Rule 57(8) – Broadsheet for Returns: A GFR 9 broadsheet is maintained by departments and subordinate authorities to track the timely receipt of all required returns and address any defaults.
Practical Example

Consider the Ministry of Health and Family Welfare. Under Rule 57, its various departments and subordinate offices, like the National Health Mission (NHM), are responsible for controlling their allocated budgets. A DDO at a district health office would prepare bills for salaries, medical supplies, and infrastructure projects, ensuring each bill has the correct account classification and updates the progressive expenditure in their GFR 5 register. Monthly, this data is sent to the Controlling Officer at the state level, who consolidates it and sends it to the Head of Department in the Ministry. Simultaneously, the DDO reconciles their figures with the Pay and Accounts Officer (PAO). This multi-layered control and reconciliation ensure that funds for health initiatives are spent as intended, within the financial year, and without exceeding sanctioned limits, thereby preventing misuse and ensuring accountability.

Related Provisions

Understanding Rule 57 is enhanced by examining related provisions within the General Financial Rules, 2017:

Learning Aids

Mnemonics
  • C.O.N.T.R.O.L.S.: Control, Officers, No Excess, Timely, Reconciliation, Outcomes, Liability, Statements.
Process Flowchart
DDO Prepares Bills(GFR 57(4)(i))DDO Maintains GFR 5(GFR 57(4)(ii))DDO Sends Monthly Return(GFR 57(4)(iii))CO Monitors Returns (GFR 6)(GFR 57(4)(iv))CO Examines Returns(GFR 57(4)(v))CO Compiles GFR 7(GFR 57(4)(vi))HOD Prepares GFR 8(GFR 57(4)(viii))HOD & AO Reconcile Monthly(GFR 57(5))

Multiple Choice Questions

1. According to Rule 57(1) of the General Financial Rules, 2017, who is primarily responsible for the control of expenditure against sanctioned grants?

  • A) The Accounts Officer
  • B) The Ministry of Finance
  • C) The Departments of the Central Government
  • D) The Comptroller and Auditor General
Show Answer

Correct Answer: C) The Departments of the Central Government

2. As per Rule 57(2) of the General Financial Rules, 2017, when can charges against a Grant or Appropriation be authorized?

  • A) Up to three months after the financial year
  • B) Only during the financial year of the Grant or Appropriation
  • C) With special permission from the Ministry of Finance
  • D) Any time, provided funds are available
Show Answer

Correct Answer: B) Only during the financial year of the Grant or Appropriation

3. According to Rule 57(3) of the General Financial Rules, 2017, what is required to exceed the total grant authorized by Parliament?

  • A) Approval from the Head of Department
  • B) A simple re-appropriation of funds
  • C) A supplementary grant or an advance from the Contingency Fund
  • D) A special audit clearance
Show Answer

Correct Answer: C) A supplementary grant or an advance from the Contingency Fund

4. Under Rule 57(4)(iii) of the General Financial Rules, 2017, by what day of each month must DDOs send a copy of their GFR 5 register entries to the Controlling Officer?

  • A) The first day
  • B) The third day
  • C) The seventh day
  • D) The fifteenth day
Show Answer

Correct Answer: B) The third day

5. Rule 57(5) of the General Financial Rules, 2017, states that who is jointly responsible for the monthly reconciliation of accounts figures?

  • A) The DDO and the Controlling Officer
  • B) The Head of Department and the Accounts Officer
  • C) The Ministry of Finance and the Audit Officer
  • D) The Parliament and the Chief Accounting Authority
Show Answer

Correct Answer: B) The Head of Department and the Accounts Officer

Frequently Asked Questions

What is the primary objective of Rule 57 of the General Financial Rules, 2017?

The primary objective of Rule 57 is to ensure effective control over expenditure by Central Government Departments against sanctioned grants and appropriations, promoting financial discipline and accountability.

Can a department authorize expenditure from a grant after the financial year has ended, according to Rule 57 of the General Financial Rules, 2017?

No, Rule 57(2) explicitly states that no charges against a Grant or Appropriation can be authorized after the expiry of the financial year.

What is the role of the GFR 5 register in expenditure control under Rule 57(4) of the General Financial Rules, 2017?

The GFR 5 register is maintained by Drawing and Disbursing Officers (DDOs) to record allocations under each minor or sub-head of account, providing a detailed, up-to-date record of expenditure for effective control and reporting.

Key Takeaways