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Rule 7 - Expenditure Sanction | KartavyaDesk

DFPR 1978delegation

Original Rule Text

Rule 7: Sanction of expenditure- (1) All expenditure shall require both, sanction and Appropriation. Expenditure can be incurred against a sanction only when funds are made available to meet the expenditure or liability by valid appropriation or Re-appropriation. (2) A sanction to recurring expenditure or liability becomes operative when funds to meet the expenditure or liability of the first year are made available by valid Appropriation or Re-appropriation or by an advance from the Contingency Fund, as the case may be, and remains effective for each subsequent year subject to appropriation in such years and also subject to the terms of the sanction.

What This Means

Rule 7 of the Delegation of Financial Powers Rules, 1978, is all about how government money can be spent. It basically says that just because someone approves spending (that's the 'sanction'), it doesn't mean the money can automatically be used. You also need to have the funds actually available in the budget, which is called 'appropriation'. Think of it like getting permission to buy a car (sanction) but also needing to have the money in your bank account to pay for it (appropriation).

This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.

Key Points

  • •Expenditure requires both sanction (approval) and appropriation (funds availability).
  • •Funds must be available through valid appropriation or re-appropriation before spending.
  • •For recurring expenses, the initial sanction is valid for subsequent years, provided funds are appropriated each year.
  • •Recurring sanctions are subject to the original terms of the sanction.

Practical Example

The Department of Rural Development wants to launch a new skill development program. The Director, Ms. Sharma, sanctions an expenditure of ₹50 lakhs for the first year. However, the sanction is only valid if the department's budget includes an appropriation of ₹50 lakhs specifically for this program. If the budget only allocates ₹30 lakhs, Ms. Sharma needs to either get a re-appropriation (transferring funds from another head) or request additional funds. The sanction for the program will remain valid for the following years, provided that the department includes the required funds in its budget each year, and the program continues to align with the original sanction's objectives.

This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.

Frequently Asked Questions

What is the difference between 'sanction' and 'appropriation'?▼
'Sanction' is the approval to spend money on a particular purpose. 'Appropriation' is the allocation of funds in the budget to cover that expenditure. You need both to actually spend the money.
What happens if I have a sanction but no appropriation?▼
You cannot spend the money. You need to ensure funds are available through appropriation or re-appropriation before incurring any expenditure.
If a sanction is for a recurring expense, do I need a new sanction every year?▼
No, the original sanction remains valid for subsequent years, provided funds are appropriated each year and the expenditure aligns with the original terms of the sanction.
What is re-appropriation?▼
Re-appropriation is the process of transferring funds from one budget head to another within the same department or organization.

This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.

Test Your Knowledge

Question 1 of 3

According to Rule 7 of the Delegation of Financial Powers Rules, 1978, what are the two prerequisites for incurring any expenditure?

Related Rules

Annexure IIDFPR 2024 - Annexure IIAppendix IDFPR 2024 - Appendix IRule 20DFPR 2024 - Rule 20 - (Expenditure from or incidence of charges on contingency fund of India)Rule 10DFPR 2024 - Rule 10 - (Re-appropriation)Rule 14DFPR 2024 - Rule 14 - (Insurance of Government property)

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