In India, the financial management of state funds and public moneys is governed by a well-structured set of rules and regulations. One such framework is the A.P. Treasury Rules (TR Rules), which plays a crucial role in managing government finances in Andhra Pradesh.
These rules are empowered by the Constitution of India, specifically under Article 283(2), which authorizes the Governor of a state to establish rules for the custody and regulation of public funds, including the Consolidated Fund of the State, Contingency Fund, and Public Accounts.
Today we will break down the TR Rules, including their various parts and sections, highlighting the role of constitutional provisions and the structure of the treasury code.
Constitutional Binding: Article 283(2) of the Constitution of India
Article 283(2) of the Constitution of India grants the Governor the authority to establish rules for managing state treasury functions. This article ensures that all public moneys—whether deposited in state funds like the Consolidated Fund or the Contingency Fund, or held by the state—are regulated by rules that govern their custody, withdrawal, and payment.
Here is the excerpt from Article 283(2) of the Constitution:
“The custody of the Consolidated Fund of a State and the Contingency Fund of a State, the payment of moneys into such Funds, the withdrawal of moneys therefrom, the custody of public moneys other than those credited to such Funds received by or on behalf of the Government of the State, their payment into the public account of the State and the withdrawal of moneys from such account and all other matters connected with or ancillary to matters aforesaid shall be regulated by law made by the Legislature of the State, and, until provision in that behalf is so made, shall be regulated by rules made by the Governor of the State.”
Thus, the Governor of the State is empowered to lay down rules regarding the management and regulation of state funds until the state legislature makes the necessary laws. The rules framed under this provision are known as the A.P. Treasury Rules (TR Rules).
Structure of the A.P. Treasury Rules
The A.P. Treasury Rules are detailed in two volumes, which outline various processes related to the handling of government funds, expenditure, receipts, disbursements, and more. These volumes help in the management and auditing of state finances, ensuring transparency, accountability, and proper utilization of funds.
Volume-I: A.P. Treasury Rules (TR.1 to TR.42)
The first volume contains the A.P. Treasury Rules, which are divided into three parts:
Part I: Treasury Rules (TR.1 to TR.42)
This part includes all the essential rules regarding the procedures for managing government funds. These rules govern the disbursement, receipt, transfer, and custody of government moneys.
Some key sections include:
- TR.1 to TR.5: These sections detail the fundamental procedures for handling treasury matters, including how moneys should be deposited, recorded, and withdrawn.
- TR.6 to TR.10: These rules focus on maintaining proper accounts, handling advances, and ensuring that funds are only drawn when necessary.
- TR.11 to TR.30: Sections in this range describe the responsibilities of the treasury officers, drawing officers, and other officials in safeguarding and managing government funds.
- TR.31 to TR.42: The latter part of this section emphasizes the roles and duties of government employees, their responsibilities for managing funds, and the procedures to follow when discrepancies are found.
Volume-I: Part II – Subsidiary Rules and Executive Instructions
This part contains additional subsidiary rules and executive instructions under the A.P. Treasury Rules. These rules elaborate on the detailed procedures, responsibilities, and operational guidelines that complement the primary treasury rules outlined in Part I.
Volume-I: Part III – Miscellaneous Statutory Rules and Executive Instructions
Part III includes miscellaneous statutory rules and executive instructions, which provide further clarity on specific issues not covered in Parts I and II.
Volume-II: Treasury Forms and Appendices
Volume-II provides practical documents necessary for treasury operations, such as forms and appendices. It is divided into two parts:
- Part II: Comprises 109 forms required for day-to-day treasury operations, including receipts, disbursements, vouchers, and other financial documents.
- Part I: Contains 27 appendices that provide additional context and clarify the operational aspects of treasury rules.
Section-I: General Guidelines and Fundamental Rules
The first section of the document provides essential instructions on how public money should be handled by the government and its officials.
- TR.1 outlines that all government moneys must be deposited into the Government Treasury for safe-keeping. The rules further state that no money should be locked up unnecessarily, ensuring that government funds remain liquid and accessible when needed.
- TR.2 emphasizes that all government payments should be made through treasuries, preventing unauthorized disbursements.
- TR.3 governs the receipt of money into the treasury, stressing that these funds must be duly accounted for, with acknowledgments issued for all amounts received.
- TR.4 defines the responsibilities of the drawing officers, ensuring that any funds withdrawn for government purposes must be spent appropriately and reported regularly.
- TR.5 deals with the maintenance of records. It mandates that each transaction must be properly documented and recorded in accordance with established accounting principles.
- TR.6 ensures that detailed accounts are kept of all financial transactions, safeguarding the integrity of the accounting system.
- TR.7 makes it clear that no payments should be made unless authorized by proper vouchers and approved by the competent authorities, ensuring that all expenditures are legitimate.
Section II: Disbursements and Accountability
The second section focuses on disbursements and the responsibilities of government servants in ensuring that the funds are used appropriately.
- TR.8 governs the disbursement of salaries and other entitlements, stipulating that payments must be made to the correct recipients and that the authenticity of claims is verified before funds are disbursed.
- TR.9 requires that any shortfalls or discrepancies in government payments be reported immediately, and corrective actions must be taken to address the issues.
- TR.10 specifies that claims for payment must be submitted with appropriate supporting documentation, such as vouchers, to ensure the validity of the claim.
- TR.11 mandates that advances made to government officers must be carefully tracked and repaid within a set time frame.
- TR.12 outlines the process for recovering overpayments, ensuring that government funds are not misused or diverted.
- TR.13 specifies the roles and responsibilities of the disbursing officers. These officers are accountable for the proper disbursement of government funds and must ensure the integrity of financial operations.
Section-III: Safeguarding and Reporting Government Funds
The third section introduces provisions that focus on safeguarding funds, maintaining accurate financial records, and ensuring accountability at all levels of government.
- TR.30 addresses the transfer of moneys standing in government accounts. It stresses that no money should be locked up unnecessarily, and the government balance with the Reserve Bank should remain as high as possible to ensure liquidity.
- TR.31 dictates that if a Treasury officer receives information from the Auditor General (AG) that funds have been incorrectly withdrawn, the officer is responsible for recovering the amount promptly.
- TR.32 focuses on the responsibility of government servants to safeguard funds entrusted to them. They must ensure that the funds are expended appropriately, and the payments reach the entitled recipients.
- SR.1 stresses that government servants are responsible for the safe custody of funds received from the treasury and must maintain accounts to monitor the correct disposal of these funds.
- SR.2 requires that disbursing officers obtain acknowledgments from recipients to ensure that funds have been received. If an acknowledgment is impossible, a certificate of payment signed by the officer must be recorded.
- SR.3 specifies that sub vouchers must be accompanied by a pay order detailing the amount in words and figures, signed by the disbursing officer to validate the transaction.
- SR.4 outlines the responsibilities of the drawing officer to disburse funds and ensures that payments are made only to the rightful recipients. It also emphasizes the return of undisbursed funds after three months.
- SR.5 emphasizes the importance of regular checks on the permanent advance balance, ensuring that all expenditures are accounted for accurately.
Section-IV: Financial Oversight and Reporting Procedures
- TR.33 to TR.37 govern transactions between the State of Andhra Pradesh and other states or entities like the Union Government and the United Kingdom. Detailed procedures under these rules are outlined in the AP Accounts Code and the Manual of Comptroller and Auditor General (CAG) of India, covering the disbursements and receipts of government funds between states and beyond.
- TR.38 emphasizes that the Auditor General operates under the control of the Comptroller and Auditor General (CAG), maintaining oversight of the financial management practices in the state.
- TR.39 clarifies that these rules do not impede the functions of the CAG, who retains the ultimate authority to oversee the financial operations of the state.
- TR.40 specifies that the Finance Minister cannot impose any responsibility on banks related to government business in contradiction to the agreements the banks have with the Governor.
- TR.41 makes it clear that all references in these rules should be interpreted with reference to the President of India during any period of state control under Article 356 of the Constitution.
- TR.42 allows the government to relax any provisions of these rules in favor of specific government servants or departments when necessary.
Constitutional Provisions
Several constitutional provisions influence the implementation of the TR rules and the functioning of government financial operations:
- Article 356 of the Constitution grants the President the authority to take control of state affairs in times of crisis, which impacts the implementation of these financial rules.
- Control under the CAG: The rules also place emphasis on the Comptroller and Auditor General (CAG), who ensures that public funds are managed in a manner that adheres to constitutional and legal guidelines.
Conclusion
The TR and SR rules, along with the constitutional provisions, form the backbone of government financial administration. These rules are designed to ensure transparency, accountability, and effective financial management within the public sector. Understanding and adhering to these rules is crucial for government servants, especially those in positions of financial responsibility. With these guidelines, the government aims to maintain integrity and avoid misuse of public funds, safeguarding the interests of the citizens it serves.
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