Para 10.13 — CAM
Original Rule Text
10.13 TREASURY SINGLE ACCOUNTS (TSA) SYSTEM:
10.13.1 The Treasury Single Account (TSA) system is intended to
(i) facilitate release of government funds to Autonomous Bodies (ABs)/ Implementing Agencies including Statutory Bodies and Central Public Sector Enterprises (CPSEs) 'just in time' principle to enhance the efficiency of fund flows to them and thereby ensuring better Cash Management in Government of India;
(ii) decrease the interest burden of the Government by decreasing the quantum of borrowings; and
(iii) avoid parking of funds released by the Government to ABs/IAs in their bank account(s).
10.13.2 Opening Bank accounts in RBI: In order to bring ABs/Implementing agencies under TSA system, each AB/IAs need to open an Assignment Account at RBI, New Delhi for receiving Assignment from Ministry/Department and issuing sub-assignments to their sub-ABs/. Transfer of Assignments only up to 2nd tier Autonomous bodies i.e. upto sub-autonomous bodies just below main ABs are covered under the TSA system.
10.13.3 Financial Advisers with the assistance of Head of Accounting Organization i.e. Pr.CCAs/CCAs/CAs(i/c) as the case may be (who should act as nodal officers for PFMS), should ensure that guidelines/instructions issued on PFMS are followed/implemented and resolve issues relating to efficient running of PFMS. (Para 18.5 of Charter for FAs).
10.13.4 Issuing of sanctions by Programme Division and submission of Bill by DDO: Based on the Monthly Expenditure Plan (MEP), requirement of the ABs/IAs and expenditure trend of the Autonomous Bodies/IAs, the Programme Division of the Ministry will process the release and issue sanction for releasing the funds to AB concerned. The terms and conditions regarding TSA
shall be mentioned. The DDO will prepare a bill on the basis of the sanction and submit the same to PAO.
10.13.5 Issuance of Assignment Advice on PFMS: PAO of the concerned Ministry/Department will configure the ABs/IAs and Sub-ABs bank account in PFMS. In order to ensure that the funds are available with the Government till actual utilization, PAO, based on sanction order, will issue an ‘Assignment Advice’ to RBI through PFMS to honour payment instruments issued by the AB concerned up to the limit assigned in the advice. The 'Assignment Advice' will contain data relating to the PAO responsible for accounting of the funds assigned to AB/IA, Unique identifier for Sanction, heads of account and Bill prominently. A copy of the sanction order and Assignment Advice will seamlessly travel to the AB/IA concerned.
What This Means
The Treasury Single Account (TSA) system ensures government funds reach Autonomous Bodies and Implementing Agencies only when they actually need the money (just-in-time), reducing idle funds and the government's borrowing costs. Instead of releasing funds directly to their commercial bank accounts, PAOs issue an Assignment Advice through PFMS to RBI. The agency can only draw from this assignment when making actual payments. Unutilized balances lapse at year-end. Sub-assignments to second-tier agencies are also managed through this framework.
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Key Points
- 1TSA releases funds on just-in-time basis to Autonomous Bodies and Implementing Agencies through RBI
- 2PAO issues Assignment Advice through PFMS instead of transferring funds to commercial bank accounts
- 3Only e-payments allowed — no cheques permitted against Assignment Accounts
- 4Unutilized balances lapse to Government at the close of the financial year
- 5Sub-assignments allowed up to 2nd tier (sub-autonomous bodies) under the TSA system
Practical Example
The Ministry of Education needs to release Rs 50 crore to an Autonomous Body for a scholarship program. Instead of transferring money to the body's bank account, the PAO issues an Assignment Advice through PFMS to RBI for Rs 50 crore. When the Autonomous Body needs to pay scholarship amounts to beneficiaries, it issues a Payment Advice on PFMS, and RBI honors the payment from the assignment. At year-end, any unspent assignment lapses back to the Government.
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Frequently Asked Questions
Can Autonomous Bodies issue cheques under the TSA system?▼
What happens to unused funds at the end of the financial year under TSA?▼
What is the accounting head for TSA transactions?▼
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.