CONTENTS

S.No. Parals) Page(a)

Definitions 18-24
CHAPTER-1
GENERAL

|Authority competent to prescribe the forms for 1-3

25
maintaining Defence Services Accounts

Departmentalisation of accounts 4 26
accounts 5 26-27
Compilation of departmentalised
6
General duties of Controller General of Defence 27-28
Accounts as a Chief Accounting Officer
duties of PCDA/CDA as an Accounting| 7-10 28-30
General
Officer
6 Miscellaneous 11-14 30
CHAPTER-2
GENERAL OUTLINES OF THE SYSTEM OF ACCOUNTS

7 Consolidated Fund Contingency Fund and 15-17 31-32

Public Account of India
of the Central and State Governments
18-19 32-33
8. Accounts
with the Bank

Transactions of other Governments in State 20 33-34

9.
Treasuries
21 34
10. State transactions in Central Treasuries
22 34-35
General outines of the system of Defence|
|11.
|Services Accounts
35-37
12. Mode of settlement of Defence transactions 23

24 37
13. Central Journal and Ledger
37-38
Statement of Central Transactions (SCT) of 25
14.
Defence Services Receipts and Charges
15. Annual Finance Accounts of the Central 26 38-39
15.
Government

The Combined Finance and Revenue Accounts 27

27 39
16.
ofthe Central and State Governments in India
CHAPTER-3
GENERAL PRINCIPLES AND METHOD OF ACCOUNTS
17. General
Period of Account 29 40-41

Cash Basis of Accounts 30 41

Currency in which Accounts are kept 31 41

18. Forms of Accounts
Main Divisions of Accounts 32-33 41-45
Major, Minor, Detailed and Object Heads 34 45-46
Classification in the books of Ministry f 35 46-47
Defence
Objectives of Classification 36 47-48

Guidelines for opening a new code 37 48-49

Pamphlet of RD&R/Classification Hand Book of 38 49-50
Defence Services Receipts and Charges
Classification of Expenditure as "Charged" or 39 50
| "Voted"
19. Classification of Transactions in Accounts
General Limitations 40 50
20. General Principles of Classification 41 50-51
21. Classification of Capital andRevenue 42 51
Expenditure
Criteria for determining whether expenditure| 43 51-52
should be classified under heads of Capital
Section or Revenue section of the Consolidated
Fund of India
Allocation between Capital and Revenue 44 52-53
expenditure on a Capital Scheme
Capital receipts during construction mainly to 45 53-54
be utilised in reduction of Capitalexpenditure
 Receipts and recoveries representing recoveries 46 54
of expenditure previously debited to Capital
Major Head
|Capital cost of non-productive work to be met| 47 54
from ordinary revenues
Conversion of outstanding loans into equity| 48 54-55
investments or Grants-in-Aid
Charging of interest on Capital outlay met out of| 49 55
specific loans raised by Government
Record of Capital Expenditure in Accounts 50 55-56
22 Important General Orders Governing 51 56
Classification
Pay and Allowances 51 (a) 56-57
Transit Pay and Allowances of Service Personnel 51 (b) 57
Transit Pay and Allowances of DAD Personnel 51 (C) 57-58
Travelling Allowances 52-57 58-59
Contribution made by Government 58 59
Refunds of Revenue 59 59-60
Classification of transactions under "Civil 60 (a) 60
Advances"
Classification of Transactions under Pay/TA on 60 (b) 60
transfer
Classification of Advancesfor Law Suits 60(C) 60
23. Classification of ransactionsunderSuspense 61 61
24 Important special orders governingclassification
of certain individual transactions
Cost of Acquisition of Land 62 61
|Sale proceeds of Government land and buildings| 63-64 61
|Cost of Survey of India and other Scientific| 65 62
Parties accompanying a Military Expedition
25.General methods of accounting8
Classification of refunds of bonafide receipts and| 66 62
recoveries of overpayments
Write off from "balance" heads to "Government| 67 63-64
|Account"
 Correction of Accounts 68 64-65
classification 69
26. Transfer entries and check of 65-66

Periodic Transfers/Adjustments 70 66
Charges 71 66-67
Checks of Classification of Receipts and
72 67-68
Powers of signing Punching Medium
73 68
Examination of Compiled Actuals
CHAPTER-4

INTER-DEPARTMENTAL TRANSFERS
RULES REGULATING
75 75 69
27. Introductory 69-70
28. Inter-departmental adjustments with other 76-77
departments of the Central Government
78 70
29. Adjustments with State Governments
79 70
30. Adjustments with outside bodies
I 80-82 70-71
31. General
CHAPTERR-5
RECOVERIES OF
RULES REGULATING ACCOUNTING OF
EXPENDITUREINGOVERNMENT ACCOUNTS
32 Introductory 84 72
33. Recoveries from private persons or bodies and 85 72
Governments outside India
Recoveries of expenditure on works in progress 86 73
34
and transactions of stock and other suspense
account
Recoveries by one Government from anotherT 87 73
35
(within India)
73-74
36.
36. Classification of recoveries made by one 88
department from another department of the
same government
89 74
37Receiptsandrecoveries on Capital account
38 Settlement of doubts or disputes 90 74

CHAPTER-6
GENERAL RULES AND PROCEDURE APPLICABLE
TO DEFENCE PROFORMA ACCOUNT
39 Introductory | 92-93 75
40. Defence transactions at bank treasuries 94 (a) 76
Concept of Focal Point Branch 94 (b) 76-77
Dealing Branches 94 ()-077-78
Verification of DMS/MSS 94 )-0 78-79
95 79
Electronic Paymentsthrough e-FPB
96 79-80
Electronic pay1nents through Private Sector
Banks/PSBs
97 80
41. Defence Transactions through e- Ticketing
98 81
RBI as FPB
99-100 81
Compilation be made under Suspense
to Head
under Defence Proforma Account on
introduction of FPB Scheme with effect from
01-10-1993
101 81-82
42 Defence transactions at non-bank treasuries
102-104 82-83
43 Advice of clearance
105 83
44. Memo of Clearance by the Reserve Bank
106 83
45 Monthly Settlement Account
107 83-84
46. Accounting heads
108 84-85
47. |Adjustments of transactions relating to the
months of February and March
109 85
|Proforma adjustments outside the Books of RBI
48. Inter-Government and inter-departmental 110-1113 85-89
adjustments
89-91
49 Works/stores expenditureand services rendered| 114

CHAPTER-7
DETAILED ACCOUNTING PROCEDURE
REGARDING ADJUSTMENT OF DEFENCE
PROFORMATRANSACTIONS
50. Remittances into Banks and Treasuries on 116 92-94
Military Receivable Order
51. Remittances to Defence Services from banks and 117 95-97
treasuries ie, cheques drawn on Banke &
Treasuries
Adjustment of electronic advice-payments 118 98
through RBI/SBI
 Adjustment of e-payments Private Sector 119 98

Banks/Public SectorBanks
Transactions originating in the
books of 120 98-100
52. of ILAC,
Railways, Posts and MEA (in respect
Washington and other embassies a/c) due for|
final adjustment in Defence accounts
in the Defence books 121 100-102
53. Transactions originating
which are adjustable against the balances of
Railways/Posts/Department of Supply in the
Ministry of Commerce (stores transaction)
ofstores
on account 122 (a) 102
Adjustment of expenditure
relating to central purchase made through
DGS&D
102
Action by PAO, DGS&D 122 (b)
|Action by the DAD Cell 122()102-103
|Action by Accounts Section of the PCDA/CDA 122 (d) 103
under whom the Cellis functioning
Action by the consignee PCDA/CDA 122 103

(e)-
122 (g) 103
Adjustment of Central Purchase Voucher
54 Accounting instructions for settlement of inter
departmental/inter Govèrnment transactions
Outward Settlement (Cash basis) 123 104-106
Inward Settlement (Cash basis) 124 106-107

55. Adjustment of e-Ticketing transactions on Cash 125 107-108

basis
56. Drawal of advances on the authority of 126 108
JEmergency Cash Requisitions
Bank Treasuries 126 (A) |108-109
Non-Bank Treasuries 126(B) 109-110
57. Defence transactions arising in Jammu and| 127 110
Kashmir State and vice versa
58 Reconciliation of balances in the books of 128 110-111
Reserve Bank
59. Treatment of incorrect and incomplete 129 111-116
debits/credits
IVerificationand Reconciliation 130-133116
 EE
E E
 prepared by EDP Centre
74. Various compilations 170
158-161
and their disposal
CHAPTER-11
MAINTENANCE OF DEFENCE LEDGER
AND VERIFICATION OF BALANCES

75. General 172 162

76. Posting of Defence Ledger 173 162-163

77 Closing of books 174 163

Balances
78. Preparation of Annual Review of 175 163-164

Treatment of Exchange Accounts 176 164

Verification of Balances 177 164-165

Verification of correctness of Statements of 178 165
Finance Accounts
Certification of Balances 179 165-166
79.Review of outstandingBalances 180-184 166-168
Details to be recorded in the review 185-188 168-169
jSecurity Deposits 189 169-170
Review of Balances on Account of Loans and| 190 170
Advances
80 Verification of Balances under sub-head "G-MES 191 170
Advances of Minor Head 111-Expenditure on|
works (Other than capital projects)
|maintenance,etc.
CHAPTER-12
ESTIMATES

81 193 175-176|
Section1-Budget EstimatesforService Heads
Periodical Review and Estimates 194 176
Estimates for Centrally Controlled Heads 195 176
| 196-198176-178
|Estimates for Locally Controlled Heads
Miscellaneous 199-201
82. Section I1-Budget Estimates prepared by the
Defence Accounts Department
202 178-179
Budget Estimates for Centrally Controlled Heads
203 179-180
Budget Estimates for Locally Controlled Heads
 [ 141
204 180
General
83. Budget estimates for Defence Pension5 205-206 181
84Budgetestimatesfor Heads pertaining to DAD 207-208 181-182
under Locally 209 182
Control over expenditure
to the Defence
Controlled Heads pertaining
Accounts Department
Estimates of
85 Section M-Cash Requirement
Defence Services
Cash Requirement Estimates for the ensuing|
210-213 182-185
Financial Year
Estimates for the 214 185
Revised Cash Requirement
Current Financial Year
86 |Section IV-Miscellaneous
under Major 215 185
Annual Statement of expenditure03-Interest
Head 2049 Sub Major Head on

ISmall Savings Provident Fund etc.

CHAPTER-13
BUDGETARY CONTROL OVER DEFENCE EXPENDITURE

87. Introductory 217-219 186-187

88 Vote on Account 220 187-188

89 Control over expenditure 221-222 | 188-189

90 Expenditure susceptible tolocal control 223-224 189
91.Initialdistribution ofbudget grants 225-227 189-190
92. Watching expenditureagainstallotments 228-231 190-192
93Re-appropriation 232 192-194
94 Loans and advances 233 194

CHAPTER-14
CASH ASsIGNMENTS
95.Cash Assignments 235 195
96 Reduction of Cash Assignments 236 195-196
97. Register of Cash Assignments 237 196

CHAPTER-15
DEPOSITS
98. General 238-241197
99 Different kind of deposits in Defence Services 242 197-198
|Accounts
 l5

100. Transactions compilable under various deposit

Heads
Donations/Contributions towards the National 243 198
Defence Academy
Security Deposits 244-247 198-199
Treasure Chest Deposits 248 199
249 200
Field Deposits
Trust Interest Fund 250 200

Unclaimed General Provident Fund Deposits 251 200

Unclaimed Deposits in Defence Savings
Provident Fund, Unclaimed Deposits in Defence
Services Officers Provident Fund, Unclaimed
Deposits in Defence Services Personnel
Provident Fund
200
Unclaimed Contributory Provident Fund 252
|Deposits
253 201
Unclaimed Deposits in Other Miscellaneous
Provident Funds_
254 201
Miscellaneous Deposits
255-256 201-202
101. Lapsed Deposits
postings in the deposit 257-259 202-203
102. Reconciliation of
registers and verification of balances
CHAPTER-16
ADVANCES AND SUSPENSE

103. Section I-Loans and Advances

General 261-271 204-207
104 Diferent types of advances in Defence Services 272 207-208
Permanent Advances 273 208-209
|Border Roads Treasure Chest 274 (1) 209
Field Cashiers' Account 274 (2) 209
Advances adjustable in PCDA/CDA Offices 274(3) 209
Pay Accounts Offices 274 (4) 210

Repayable (non-voted 274 (5)210

Imprest Holders' Accounts 274 (6) 210
 Miscellaneous Advances 274(7) 210
Other Advances 274(8) 210

105. Interest bearing Advances 275-279 210-211

280-281 211-212
106. Regimental and other Loans-Defence
283-284 212
Reconciliation of postings in registers and
107.
verification of balances
285 212-213
Acknowledgement of balances
286-288 213-214
108. Section II-Suspense Accounts
CHAPTER-17
EXPENDITURE MET OUT
ACCOUNTING OF
CONTINGENCY FUND OF INDIA AND
OF THE
OF "CHARGED" EXPENDITURE

290-291215-216
109 Advances from Contingency Fund of India 292-297 216-219
110.Charged"Expenditure
298 219-220
award respect
in
Satisfaction of decrees/Arbitral
or acquisition of
of compensation for requisition
properties of Defence
299 220-222
111. Provision of Funds
222-223
300-301222-223
procedure in respect of expenditure
112. Accounting
India
met from the Contingency Fund of 302 223-224
statistics of expenditure
113. Maintenanceof
classified as "Charged"
CHAPTER-18
MISCELLANEOUS

of Staff for 303-304 225-226

114.Sanctions by the Chiefs
non-recurring payments
305 226
115 Military Receivable Orders
306-307 227
116. Receipt of Cash, cheques, etc.
117.Corrections in documents 308 227
227-228
118.Special expenditure on account of field 309
operations and special services
119. Rounding off the transaction to the nearest 310 228-230

rupee

120. Adjustments with Pakistan 311 230

 171
121.Classification of losses 312 230-231

Classification of losses of buildings, lands, stores 313 231

and equipment
Classification of losses or deficiencies of cash in 314 231
hand, whether in treasuries or in departmental
|charge
Classification of irregular and unusual payments31S 231

Classification ofinevitablelosses 316 232

122. Grants-in-Aid 317 232

APPENDICES

APPENDIXI List of Sections/Sectors/Sub-Sectors under the|233-238

main Division of Accounts_
APPENDDX II List of Standard Object Heads 239-243
APPENDIX Im Principles and rules regulating the distribution of 244-255
certain charges and receipts between
Governments
APPENDIX V Annual and periodic adjustments 256-257
APPENDIXV Flow Chart of functioning of FPB 258-259
APPENDIXKVI Focai Point Branches nominated for Ministry of 260-262
Defence
APPENDIX VI |Dispensing with monetary settlement of 263-264
interdepartmental transactions
APPENDIX VIn|Reconciliation of Defence Transactions/ RB 265-296
Deposits
APPENDIXIX Maintenance of Defence Ledger and preparation 297-367
of Annual Review ofBalances
APPENDIXX List of Locally Controlled Heads 368-377
APPENDIXXI |Demand for grants for Defence and Integrated 378
Financial Advice System
Index Alphabetical Order for Reference 379-392
SOLVED OBJECTIVE QUESTIONS
(For New Pattern SAS Examination) 393
 18

DEFINITIONS

requires, the
context otherwise
In this Code, unless the
expressions have the meanings hereby respectively
following
assigned them - that is to say
to
1. "Accountant General"
office of including
Accounts
means the Head of an
subordinate to the
General
Principal Accountant of India, and when
Comptrollerand Auditor General
relation to a treasury, the head of an office of
used in
accounts of the treasury are
accounts to whom the

rendered
2. Accounts Area"
the of which are dealt with by
accounts
means an area
Accounts Officer;
one and the same

3. Accounts Officer"
Accounts or the Head of
means the Head of an Office of
Accounts Office set up
under the scheme of
a Pay and
departmentalization of accounts;

4. "Accredited Bank"
or Union
means in relation to a Ministry or Department, which
Reserve Bank or any bank is
territory means the
transact business of the Government
appointed to
or Union
pertaining to that Ministry or Department

territory;
5"Appropriation"
means the assignment, to meet specified expenditure, of
funds included in a primary unit of appropriation;
6. "Bank"
means Reserve Bank of India or any of its offices or
branches, any branch of the State Bank of India acting |
as the agent of the Reserve Bank of India in accordance
with the provisions of the Reserve Bank of India Act,
1934 (2 of 1934), any branch of a subsidiary bank as
defined in section 2 of the State Bank of India
(Subsidiary Banks) Act, 1959 (38 of 1959) which 1s|
authorised to transact Government business as agent o
the State Bank of India, or any branch of a bank
including four private sector banks ICICI Bank Lta
HDPC Bank Ltd, Axis Bank Ltd and IDBI Ltd, as may
 19 1
as its agent
appointed by the Reserve Bank of India section 45 of
under the provisions of sub-section () of
of 1934);
the Reserve Bank of India Act, 1934 (2
7. "Bank Treasury"
which is
meansa treasury the cash business of
India
conducted by the Bank (i.e., the Reserve Bank of
or any office or agency of the
Reserve Bank of India andd
its
includes any branch of the State Bank of India or
Bank of
subsidiaries acting as the agent of the Reserve
means a treasury
India) and a "Non-Bank treasury"
other than a Bank treasury;
8. "Central Treasury"
not
means and includes any treasury or sub-treasury
or sub-treasury under
control of a State
being a treasury
Government;
9. "CGDA"
the
means the Controller General of Defence Accounts,
Head of the Defence Accounts Department;
10. "Cheque Drawing DDO"
means a drawing and disbursing officer functioning
Central
under a Ministry or Department (including
and
Public Works Department, Forest Department
of Central Publicc
Departments in which the provisions
Works Account Code are authorised to be followed)
or a
union territory, who is authorised to withdraw money
for specified types of payments against an assignment
account opened in his favour in a specified branch of an
accredited bank;
11."Chief Accounting Authority"
means the Secretary of a Ministry or Department of the
Government of India in which the Departmentalised
introduced and in the
System of Accounting has been
case of a Union Territory with separated
accounts, its
Chief Secretary/Chief Commissioner;
12. "Civil Accounts Officer"
to the
the
means an Accounts Officer subordinate
Accounts
Comptroller and Auditor General, or Principal
Officer and/or Pay and Accounts
Officer functioning
of Central
under the scheme of departmentalization
set
accounts
Government (Civil) Accounts or separated
 20 1
up of a Union Territory Government or Administration
as the context may imply. In relation to Railways
Department of Post, it means the heads of the
Accounts Office and Officers subordinate to them;
13. "Competent Authority"
means, in respect of power to be exercised under any of
he General Financial Rules, the President or such othel
authority to which the power s delegated by or under
GFR, Delegation of Financial Power Rules, 1978 or any
other general or special orders issued by the
Government of India;
14. "Comptroller and Auditor General"
means the Comptroller and Auditor General of India
appointed under Article 148 of the Constitution of
India;
15. "Consolidated Fund"
means the Consolidated Fund of India as referred to in
clause (1) of Article 266 of the Constitution;
16. "Constitution"
means the Constitution of India;
17. "Contingency Fund"
means the Contingency Fund of India established under
the Contingency Fund of India Act, 1950 (49 of 1950)
in pursuance of clause (1) of Article 267 of the
Constitution;
18."Controller General of Accounts"
means the Controller General of Accounts in the
Ministry of Finance (Department of Expenditure), who
inter-alia, is responsible for prescribing the form of
accounts of the Union and States, and to frame,
or
revise, Rules and Manuals relating thereto on behalf ot
the President of India in terms of Article 150.of
Constitution of India, on the advice of the
the
and Auditor General of India; Comptroller
19. "Debt Heads"
In relation of
Ministry of Defence means the head of
accounts under which transactions
of
closing to balances are recorded and carriedGovernmen
forward to
the next financial
year which includes heads of Debts,
Loans and Advances, Provident
Funds, Reserve Funds,
 211
Deposits and Advances and Suspense and
Miscellaneous;
Circles"
20. "Defence Accounting
means the offices of the Defence Accounts Department
including Controller General of Defence Account, who
are nominated by the RBI to account for and reconcile
transactions in the Defence Proforma Account.
Note: CGDA Delhi Cantt., PCDA (Pensions) Allahabad,
PCDA (Officers) Pune, PCDA (SC) Pune, PCDA
Bengaluru, PCDA (WC) Chandigarh, Principal
Controller of Accounts (Fys) Kolkata, PCDA (AF)
Dehradun, PCDA (Navy) Mumbai, PCDA (NC) Jammu,
PCDA New Delhi, PCDA (R&D) New Delhi, PCDA (CC)
Lucknow, PCDA (BR) Delhi Cantt., PCDA (SWC) Jaipur,
CDA Patna, CDA (Army) Meerut, CDA (Funds) Meerut,
CDA Chennai, CDA (CSD) Mumbai, CDA (PD) Meerut,
CDA Guwahati, CDA (R&D) Bengaluru, CDA
Secunderabad, CDA Jabalpur, CDA (AF) New Delhi,
CDA (R&D) Hyderabad, CDA (IDS) New Delhi, Z0
(DPD) Chennai, AO, DAD, MOD (Civil) New Delhi, are

Defence Accounting Circles;

21. "Disbursing Officer"
means a Head of the Office and also any other Gazetted
Officer so designated by a Department of the Central
Government or an Administrator, to draw bils and
make payments on behalf of a Central Government. The
term shall also include a Head of the Department or an
Administrator where he himself discharges such

functions
22. "EFT"
is the Electronic Exchange, transfer of money from one
account to another, either within a single financial
institution or across multiple institutions, through
computer-based systems;
23. "Financial Year"
means the year beginning on the 1st of April and ending
on the 31st of March following
24. "Government"
means the Central (Union) Government or a State
or all
overnment, or a Union Territory Government,
the three, as the context may implys
 221
25. "Local Fund"
means a local fund as defined in Rule 652 o
the
Treasury Rules;
26. "NEFT"
means National Electronic Fund Transter, a nation wid.
payment facilitating one-to-one nds transfer sche
in which, individuals, firms and corporate ca
can
electronically transfer funds from any bank branch to
any individual, firm or corporate naving an accoun
with any other bank branch in the country participating
in the scheme;
27. "Principal Controller/Controller" or "Principal
Controller/Controller of Defence Accounts"
means an Accounts Officer under the Administrative
control of the Controller General of Defence Accounts
who is responsible for the maintenance and internal
audit of the accounts of Defence Services in his
jurisdiction. The term includes
Principal Controller of Defence Accounts, New Delhi
Principal Controller of Defence Accounts (AF)
Dehradun
Principal Controller of Defence Accounts (WC),
Chandigarh
Principal Controller of Defence Accounts, Bengaluru
Principal Controller of Defence Accounts (SWC), Jaipur
Principal Controller of Defence Accounts (SC), Pune
Principal Controller of Defence Accounts (R&D), New
Delhi
Principal Controller of Defence Accounts (Pensions),
Allahabad
Principal Controller of Defence Accounts
Pune (Officers)
Principal Controller of Defence Accounts
(NC), Jammu
Principal
Mumbai
Controller of Defence Accounts (Navy),
Principal Controller of Defence Accounts
Principal Controller (cC), Lucknow
of Defence Accounts (BR),
Delhi New

Principal Controller of Accounts

(Fys), Kolkata
 23 1
Controller of Defence Accounts, Secunderabad
Controller of Defence Accounts, Patna
Controller of Defence Accounts, Jabalpur
Controller of Defence Accounts, Guwahati
Controller of Defence Accounts, Chennai
Controller of Defence Accounts (R&D), Hyderabad
Controller of Defence Accounts (R&D), Bengaluru
Controller of Defence Accounts (PD), Meerut
Controller of Defence Accounts (IDS), New Delhi
Controller of Defence Accounts (Funds), Meerut
Controller of Defence Accounts (CSD), Mumbai
Controller of Defence Accounts (Army), Meerut
Controller of Defence Accounts (AF), New Delhi
28. "Public Account"
means the Public Account of India or the Public Account
of a State referred to in clause 2 of Article 266 of the
Constitution or both as the context may imply;
29. "Reappropriation
means the transfer of funds from one primary unit of
appropriation to another such unit;
30. "Remittance Heads"
Remittance Heads Refer to head of accounts to which
transactions relating to remittance business are taken.
Note: In relation of Ministry of Defence Cash
Remittances and adjustments between officers
rendering accounts to the same Accounts Officer,
(Major Head 8782) Adjusting Account with Railways
and Department of Post (Major Head 8787 and 8788)
and Exchange Account (Major Head 8797);
31. "Reserve Bank"
means any office or branch of the Banking Department,
of the Reserve Bank of India constituted under the
Reserve Bank of India Act, 1934 (2 of 1934);
32. "Revenue Heads"
refer to the heads of account under which are recorded
all proceeds of taxation and other receipts classed as
revenue and the expenditure met therefrom;
 24 1
33. RTGS"
means Real Time Gross Settlement of fund
transfers
The
individually on an order basis (without netting).
funds settlement takes place in the books of Reserve
Bank of India. It is primarily meant for large value
transaction with a minimum amount to be remitted is
Rs. 2 Lakhs;
34. "SBI-CMP"
means State Bank of India-Cash Management Product, a
customized and secured payment gateway for Central
Government Departments including Defence Accounts
Departments which will be a uniform and approved
process across the country with stricter Turn Around
Time (TAT);
35. "Sub Audit (Accounts) Officer"
means an Account Officer who
performs accounting
functions on behalf of another Account Officer;
36. "Treasury Rules"
means the Treasury Rules
oftheCentral Government.
Chapterl

1 Authority competent to prescribe the Forms

General

for maintain'ng defence services accounts

The Ministry of Defence (Finance) of the Govt. of India is
to ensure that suitable accounts are maintained by the Defence
Services. Accordingly, the Principal Controllers/Controllers should
seek the intervention of that Ministry, through the Controller
General of Defence Accounts in cases in which the forms of initial
or other accounts or of bills, prescribed by competent authority, are
deviated from.
2. The forms in which the accounts should be kept in the
offices of the Defence Accounts Department are prescribed by the
Controller General of Defence Accounts, with the approval of the
Defence Secretary and Financial Adviser but if any change afects
the form of the Finance and Revenue Accounts, it will not be made
without the previous sanction of the Controller General of
Accousts and Comptroller and Auditor General.
Note: The word form' has comprehensive meaning so as to
include the prescription not only of the broad form in which the
accounts are to be kept but also the appropriate heads under which
certain transactions or classes of transactions have to be entered.
3. (a) The Government of India may require any information
which can be derived from the accounts maintained in an Accounts
office, and for this purpose an Accounts Office of the Defence
ACCounts Department may find it necessary on occasions to make

slight amendments in the forms for maintaining accounts. All

be
changes in the prescribed forms and procedure should
referred to the Controller General of Defence Accounts.

(6) All returns, and statements required by the

accounts
Controller General of Accounts and Comptroller and Auditor
General should invariably be prepared in the forms preseribed by
them.
(25)
 Departmentalisation of Accounts

4. (a) From 1st October, 1976 onwards, the responsibility for

Services including those
those
compiling the accounts of Defence
and deposits realised or
relating to taxes, duties and other receipts
refunded under any law has been entrusted to the Controller
General of Defence Accounts.
(b) The Controller General of Defence Accounts functions on
behalf of Secretary Defence (Finance)/Financial Adviser (Defence
Services), as the Chief Authority in all matters affecting financial
advice, internal audit and the accounting in respect of expenditure
pertaining to the Defence Services. Under the scheme of
Departmentalisation of accounts in the Ministry of Defence, the
Defence Secretary will be the Chief Accounting Authority for all
transactions of the Ministry of Defence and this responsibility is
discharged by him through and with the assistance of Secretary
Defence (Finance)/Financial Adviser (Defence Services), who will
function for and on behalf of the Chief Accounting Authority. The
payments and accounting functions in respect of the Ministry of
Defence are entrusted to the Controller General of Defence
Accounts who wil function as the Principal Accounting Officer
Controller General of Defence Accounts on behalf of Chief
Accounting Authority (the Secretary of Ministry of Defence) is
responsible for the compilation and consolidation of the accounts
of the Ministry of Defence in the prescribed form and their timely
rendition to the Controller General of Accounts. The Controller
General of Defence Accounts, on behalf of Chief Accounting
Authority arranges payments of Defence Services through Principal
Controllers/Controllers Office and the cheque drawing DDOs and
is also responsible for arranging internal audit of all expenditure.

Compilation of Departmentalised Accounts

5. The Defence Accounts Department classifies expenditure
in respect of ) Defence Services paid from Defence Service
Estimates and i ) Civil organisations under Ministry of Defence
fincluding Defence Accounts Department, mentioned below, which
are paid from the civil grant of Ministry
of Defence
 27 1
(i) Armed Forces Tribunal
(i) Coast Guard Organisation
Cii) Department of Defence
iv) Department of Defence Production

(v) Department of Defence Research and Development

(vi) Departnient of Ex-Servicemen Welfare (DESw
(vil) Defence Accounts Department
(Vii) Defence Estates Organisation
ix) Jammu and Kashmir Light Infantry
R)Canteen Stores Department
General Duties of Controller General
of Defence Accounts as a
Chief Accounting Officer

6. The CGDA is responsible for the following items of work

under the scheme of departmentalisation, performed for and on
behalf of the Chief Accounting Authrrity:
(a) Consolidation of the accounts of the Ministry of Defence
in the manner prescribed by CGA;
b) Arranging all payments of Defence Services through
PCsDA/CsDA, Drawing and Disbursing Officers of the Services
wherever they are authorized to make certain types of payments;
(c)Submission of Statement of Central Transactions and
material for the Finance Account of the Defence and Defence
(Civil) to the Controller General of Accounts
(d) Preparation of annual Statement of Central Transactions
(SCT) of Defence Services Receipts and Charges and rendition to the
Controller General of Accounts, Ministry of Finance, Department of
Expenditure, New Delhi on the date prescribed by them;
(e) Preparation of certain subsidiary statements in
connection with the Appropriation Accounts as preseribed in
Defence Audit Code and submit them to the Financial Adviser,
Defence Services/Secretary (Defence Finance). CGDA also renders

annually an Audit Certificate on the accounts of the Defence

Services, to the Financial Adviser, Defence Services/Secretary
(Defence Finance);
 niom s t l 28J TOT 9dre0g29
30n229
CC Preparation of the portion of the Combined Finance nd
Revenue Accounts pertaining to Defence Services and its
submission to the Controller General of Accounts and Director
General of Audit, Defence Services for incorporation in the
combined Finance and Revenue accounts of the Central and State
Government in India
(g) Preparation of the Appropriation Accounts of the Civil
Estimates of the Ministry of Defence and sending the same to the
Financial Adviser, Defence Services/Secretary (Defence Finance)
and the Defence Secretaryy or onward transmission to the
Controller General of Accounts and Director General of Audit,
Defence Services.

General Duties of Principal Controller

Controller as an Accounting Officer
7. Principal Controller/Controller is the chief
authority of
Auditing & Accounting function in respect of Formations/Units
under their jurisdiction. Accounting duties and functions can be
put into the following broad categories:
i) Receipts, Disbursements and Accounts:
(a) To collect accounts of all receipts and disbursements in
the accounts area
(b) Ensure accurate and timely payments in conformity with
prescribed rules and regulations;
(C) Timely realization of receipts and credit in Government
Account;
d) To transfer to other Accounts Circle the items originating
in their areapertaining to them and adjusting in his accounts the
items transferred to him by other Accounts Officers.
(ii) Financial Management Systems:
(a) To keep a watch over the progress of
area under the
expenditure for the
locally controlled heads against sanctioned
allotments and to bring to the notice of the allottees and
the
immediate higher authorities, cases in which the
expenditure is abnormally heavy or progress of
unusually loW;
 b) Responsible for the implementation of financial
information systems as prescribed by the Controller General of
Defence Accounts and to provide necessary material in respect of
reports of Annual Finance Accounts;
CC) Cash requirement Formulation;
() The Principal Controllers/Controllers will support the
Controller General of Defence Accounts towards formulation of
cash requirements in respect of various heads (other than
budgetary heads).
Ci) They would formulate the budgetary requirements of the
DAD and render estimates to the CGDA.
8. Each Principal Controller/Controller is responsible for the
accuracy and efficient working of the numerous processes of which
the monthly account is the outcome. He should keep himself
thoroughly acquainted with the progress of receipts and
expenditure, so as to be able to promptly bring to notice any
matter demanding attention. He is charged with the administration
of those numerous matters in his area, of which Governmentis
debtor or creditor, and it is his duty to see that proper accounts are
kept of all those transactions and that due measures are taken for
their adjustment without undue delay. He settles accounts with
other Accounts Officers and it is his duty to see that these accounts
are promptly settled. The Principal Controller/Controller has the
care of the pecuniary relation of the Defence Services of the
Government of India in his area with other Governments,
Departments, individuals and bodies and for this purpose he is not
merely to keep the accounts but also to watch and in some cases to
direct the matters out of which the accounts arise.
9. Each Principal Controller/Controller is responsible for
ensuring that all transactions for which necessary monetary
settlement has been effected against the Defence balance by other
Accounts Offices are speedily adjusted in Defence books and are
not left outstanding in the suspense heads for an unduly long
period.
10. Each Principal Controller/Controller is responsible for
or by Government
maintaining the details of the amount due to
He is further
Working upto the balance on his own books.
 301
responsible for reviewing these balances at the end of each year in
the manner prescribed in Chapter 11 and for submitting a copy of
his review of balances along with statement no. 5 & 13 to the

CGDA. Copies of the review of balances are also furnished to

Principal Director/Director of Audit Defence Services for audit
Government
CGDA Will prepare statement No. 5 & 13 of Union
Finance Account and send the same to the CGA.

Miscellaneous
to an Accounts Office of
I1. No requisition for submission
new account returns should be issued by the Principal
General
Controller/Controller without reference to the Controller
of Defence Accounts and if the requisition is to an
officer not
the
subordinate to the Principal Controller/Controller, the views of
local administrative authorities should first be obtained.
12. All communications on matters affecting the
classification of Receipts and Charges and on form and procedure
relating to accounts should always be addressed to the Controller
General of Defence Accounts.
13. Principal Controllers/Controllers should not address the
Comptroller and Auditor General and Controller General of
Accounts direct except on routine matters.

14. Principal Controllers/Controllers should not address

Services Headquarters or the Ministry of Defence (Finance)
directly, except on routine matters or in connection with the
prescribed estimates and returns rendered direct to them. All
questions involving interpretation of rules or procedural changes
should be referred by the Principal Controllers/Controllers to the
Controller General of Defence Accounts.