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Why is there a Rs. 1,000 threshold for no-monetary-settlement? What happens to that cost?

Government AccountsGARRule 40

The Rs. 1,000 threshold is a practical de minimis provision to avoid the administrative cost of settlement exceeding the value of the service itself. Below this threshold, the supplying government simply absorbs the cost — it appears as its own expenditure. There is no inter-governmental recovery. The exception for commercial departments ensures that entities that need to break even are not forced to absorb any costs.

Source: GAR Rule 40

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This answer is for informational purposes only and does not constitute legal advice. Always refer to the original rules and consult competent authorities for official interpretation.