Para 2.16.17 — CAM
Original Rule Text
2.16.17 LOANS AND ADVANCES BILLS
(i) In respect of loans and advances to public sector undertakings, autonomous bodies etc., the sanctions should be examined and the reasons for any unusual conditions included therein, if any e.g., remission of interest in an individual case, should be enquired. It has to be seen that the conditions of repayment of loans and advances are complied with by the debtor and the PAO should exercise a close watch over repayment of principal and realisation of interest. In reviewing the outstanding loans and advances, special attention should be directed to irregularities in payments, acknowledgement of balances and unrealizable and doubtful assets. During the precheck of a loan or advance bill, it should be seen that:-
(a) the amount claimed is in accordance with the sanction order, and
(b)the conditions to be fulfilled before payment, if any, are actually fulfilled and a certificate to that effect is recorded on the bill.
(ii) For watching the recovery of loans, Loan Register
(s) are to be maintained in Form CAM – 29 in PFMS.
(iii) The responsibility for calculation of interest on interest bearing advances, recoverable from the loanee Government servant will be that of the head of office/drawing and disbursing officer both for gazetted and non-gazetted Government servants. The heads of offices would, however, be responsible for obtaining mortgage bonds and agreements and ensuring that necessary insurance, as required under the rules, is obtained. When advance is getting closed as per CAM 29, PAO seek Head of Office and DDO about the applicable interest on advance to be recovered from Pay Bill i.e. enhanced interest or normal interest, based on the repayment of principal component.
(iv) Pay and Accounts Officers will be responsible for
(a) checking the correctness of the interest recovered by the drawing and disbursing officer, and
(b) confirmation of the correctness of the balances as shown in the recovery schedules and pointing out discrepancy, if any, to the concerned drawing and disbursing officer.
(Authority: Ministry of Finance (DEA) O.M. No. F. 10(9)-B(TR)/76 dt. 1.11.1976)
2.16.18 LONG TERM ADVANCES TO GOVERNMENT SERVANTS (ADVANCES RECOVERABLE IN NOT LESS THAN 60 MONTHLY INSTALMENTS)
(i) Advances drawn must be checked in full. It should be seen:
What This Means
When processing bills for loans and advances to public sector undertakings, autonomous bodies, and government employees, the PAO must carefully examine the sanction orders and watch for any unusual conditions like interest remission. The PAO must monitor repayment schedules, ensure interest is collected on time, and review outstanding balances regularly. Special attention is given to detecting irregularities such as overdue installments, unauthorized use of loan funds, or breaches of loan conditions. For advances to government employees (house building, motor car, etc.), the PAO maintains registers and broadsheets to track recoveries.
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Key Points
- 1PAO must examine loan sanctions for any unusual conditions like interest waivers
- 2Close monitoring of repayment of principal and timely realization of interest is mandatory
- 3Outstanding loans and advances must be reviewed regularly, with attention to irregularities
- 4Advances to government employees (HBA, motor car) require maintenance of registers and broadsheets
- 5Overdue installments and breaches of loan conditions must be promptly flagged
Practical Example
A government employee receives a House Building Advance (HBA) of Rs.25 lakh. The PAO enters the details in the HBA register and broadsheet, noting the sanction amount, interest rate, EMI, and repayment schedule. Every month, the PAO verifies that the correct EMI is being deducted from the employee's salary. When the employee is transferred, the PAO ensures the recovery continues through the new PAO. If an installment is missed, the PAO immediately flags it and initiates recovery action.
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Frequently Asked Questions
What registers must the PAO maintain for employee advances?▼
What should the PAO do if a public sector undertaking misses a loan repayment?▼
Can the PAO waive interest on a loan on its own?▼
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.