In these rules, unless the context otherwise requires,-
(a) Accountant General', means the Head of an Office of. Accounts subordinate to the Comptroller and. Auditor General of India.
(b) 'Bank' means 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 is authorised to transact Government business as agent of the State Bank of India, or any branch of a bank as may be appointed by the Reserve Bank of India as its agent under the provisions of sub-section (I) of section 45 of the Reserve: Bank of India Act, 1934 (2 of 1934);
(c) "Chief. Accounting Authority', means the Secretary of: a Ministry or Department of the Government of India in which the Departmentalised System of Accounting has been introduced and in the case of a Union Territory with separated accounts, its Chief Secretary/ Chief Commissioner.
(d) 'Civil. Accounts Officer,, means an Accounts Officer: subordinate to the Comptroller and Auditor General, or a Principal Accounts Officer and or Pay and. Accounts Officer functioning under: the Scheme of Departmentalisttinn of Central Government (Civil) Accounts or under separated accounts set up of: a Union Territories, Government or Administration as the context may imply. The expression Civil Accounts Office': should also be construed accordingly.
(e) Comptroller and. Auditor General" means the Comptroller and Auditor General of India appointed under article 148 of the Constitution of India.
( "ontroller 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 of the President of India in terms of article 150 of the Constitution of India, on the advice of the Comptroller and. Auditor General of India.
(g) Consolidated Fund' means the Consolidated Fund of India or of a State, referred to in clause (1) of article 266 of the Constitution, or of a Union Territory Government, referred to in Section 47 of the Union Territories Act, 1963, or all the three, as the context may imply (Appendix -1).
(h) Contingency Fund', means the Contingency Fund of India established in pursuance of clause (1) of article 267 of the Constitution or the Contingency Fund of: a State established in pursuance of clause (2) of article 267 of the Constitution, or the Contingency Fund of a Union Territory Government established in pursuance of Section 48 of the Union Territories Act, 1963, or all the three, as the context may imply (Appendix-1).
What This Means
Rule 2 provides precise definitions for all key terms used throughout GAR 1990. Understanding these definitions is critical because the same word can have different meanings in everyday language versus government accounting law. For example, 'Bank' under GAR does not mean any commercial bank — it specifically means branches of the State Bank of India or other banks authorized by the Reserve Bank of India to handle government transactions.
Some of the most important definitions are: 'Accountant General' (head of a CAG-subordinate accounts office), 'Chief Accounting Authority' (the Secretary of a ministry or department), 'Civil Accounts Officer' (an officer handling civil accounting under the departmentalised system), and 'Controller General of Accounts' (the apex civilian accounting authority in the Ministry of Finance). The definitions also clarify the three constitutional funds — the Consolidated Fund, the Contingency Fund, and the Public Account — which form the basis of all government financial classification.
These definitions apply uniformly to Union Government, State Governments, and Union Territory Governments wherever the GAR applies. Many terms carry a triple meaning ('as the context may imply'), meaning they refer to the Central, State, or UT government depending on which entity's accounts are being discussed.
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Key Points
1'Bank' means the State Bank of India or any bank authorized by RBI to transact government business — not just any commercial bank.
2'Chief Accounting Authority' is the Secretary of the ministry or department in the departmentalised accounts system.
3'Controller General of Accounts' is responsible for prescribing the form of accounts of the Union and States on behalf of the President, on the advice of the CAG.
4The Consolidated Fund, Contingency Fund, and Public Account are the three constitutional funds under Article 266 and 267 of the Constitution.
5'Treasury' includes sub-treasuries for the purpose of these rules.
6'Government' means Central, State, or Union Territory Government depending on context.
7'Defence Department' means the department whose expenditure is met from Defence Services Demands for Grants.
Practical Example
A Pay and Accounts Officer (PAO) in the Ministry of Health is processing a salary payment. The officer writes a cheque on the designated branch of SBI (which is acting as agent of RBI for government transactions). Under GAR Rule 2, this branch qualifies as the 'Bank' because it has been authorized by RBI to handle government business. If the PAO mistakenly deposits money in a non-designated cooperative bank, it would not qualify as a 'Bank' under GAR, creating an accounting irregularity.
When the Secretary, Ministry of Health, signs off on appropriation accounts, she does so in her capacity as 'Chief Accounting Authority' under Rule 2(c). This is a formal designation — it is not just any senior officer but specifically the Secretary of the ministry in whose ministry the departmentalised accounts system operates.
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Frequently Asked Questions
▼▼▼▼▼
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
() Defence Department means that Department of the Central Government, whose expenditure is met from the Demands for Grants relating to Defence Services.
@ Government', means the Central (Union) Government or a State Government, or a Union Territory Government, or all the three, as the context may imply.
(k) 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 (Appendix 3).
() 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).
(m) "State', except where it appears otherwise from the context, refers to a State included in the First Schedule to the Constitution.
(n) 'the Constitution', means the Constitution of India.
(0) Treasury, includes a sub-treasury.
2. In the discharge of these function, he will also have special responsibility for:-
( Coordination with the Ministries in the administration and interpretation of Rules regarding Group "C and: Group D' staff of the Central Civil Accounts Service;
(i) Holding of Departmental examination analogouss to S.A.S. examinations etc., held by the Comptroller and. Auditor General of India) to maintain the requisite standard of technical expertise for accounting work in the Ministries and Departments;
(ii) Revising Treasury Rules, Account Codes and provisions of General Financial Rules in so far: as they relate to the form, and system of accounts etc., consequent upon the departmentalisation of Accounts and the use of the services of the public sector banks in place of treasuries, for collecting receipts and making payments.
2. This Order shall come into force on the 1st day of April, 1976.
II. Copy of Order No. 1 (15)-B (A/cs) /76 dated 6th March, 1976 issued by the Government of India, Ministry of Finance (Department of Economic Affairs).
In exercise of the powers conferred by the first proviso to subsection (1) of Section 10 of the Comptroller and Auditor General's (Duties, Powers and Conditions of Service) Act, 1971 (56 of 1971), the President, after consultation with the Comptroller: and. Auditor General, hereby relieves the Comptroller and Auditor General from the responsibility for compiling the accounts of the Postal Wing and Civil Engineering Wing of the Department of Posts: and Telegraphs of the Ministry of Communications.
2. This Order: shall come into force on the 1st day of April, 1976.
- III. Copy of Order No. I (15)-B (A/cs) /76 dated 3-6-1976 issued by the Government of India, Ministry of Finance (Department of Economic Affairs).
In exercise of the powers conferred by the first proviso to subsection (1) of Section 10 of the Comptroller and Auditor General's (Duties, Powers and Conditions of Service) Act, 1971 (56 of 2971), the President, after consultation with the Comptroller and. Auditor General, hereby relieves the Comptroller and Auditor General from the responsibility for compiling the accounts of-
(a) The Ministry of Agriculture and irrigttion,
(b) The Ministry of Chemicals and Fertilizers,
(c) The Ministry of Commerce,
(d) The Ministry of Energy,
(e) The Ministry of Petroleum, ()) The Ministry of Shipping and Transport,
(g) The Ministry of: Steel and Mines,
(h) The Ministry of: Supply and Rehabilitation, and 0 The Ministry of Works and Housing.
2. This Order shall come into force on the 1st day of July, 1976.
IV. Copy of Order No. F. I (15)-B (A/cs) /76 dt. 26-8-1976 issued by the Government of India Ministry of Finance (Department of Economic Affairs).
In exercise of the powers conferred by the first proviso to subsection (1) of section 10 of the Comptroller and Auditor General's (Duties, Powers and Conditions of Service) Act, 1971 (56 of 1971), the President, after consultation with the Comptroller: and Auditor General, hereby relieves the Comptroller and Auditor General of India from the responsibility for compiling the: accounts of-
1.1 President's Secretariat. 2.' Vice-President's Secretariat. 3. Prime Minister's Secretariat. 4. Cabinet Secretariat, including Department of Personnel Department of Cabinet Affairs. 5.1 Department of Parliamentary: Affairs. 6. Department of Atomic Energy. 7.1 Department of Electronics. 8. Department of Science and Technology. 9. Department of Space. 10. Ministry of Education, Social Welfare and Culture. 11. Ministry of Law, Justice and Company Affairs. 12. Ministry of Health and Family Planning. 13. Ministry of Labour. 14. Ministry of Information andi Broadcasting. 15. Ministry of External Affairs. 16. Ministry of Defence. 17. Ministry of Planning including Planning Commission. 18. Union Public Service Commission. 19. Election Commission of India. 20. Supreme Court of India. 21. Central Vigilance Commission.
and. Administrative Reforms and
2. This Order shall come into force on the 1st day of October, 1976.
V. Copy of Order No. P. I (15)-B (A/cs) 76 dt. 8-9-1976 issued by the Government of: India, Ministry of Finance (Department of Economic Affairs).
In exercise of the powers conferred by the first proviso to subsection (1) of section 10 of the Comptroller and Auditor General's (Duties, Powers and Conditions of Service) Act, 1971 (56 of 1971), the President, after consultation with the Comptroller: and: Auditor General, hereby relieves the Comptroller and Auditor General from the responsibility for compiling the account of-
(a) the Ministry of Finance, except those relating to 0 pensions; and (I) the Indian Audit and Accounts Department;
(b) thei Ministry of Home Affairs, except those relating to €) such of the Union Territories whose accounts are; on the date of the issue of this Order, being compiled by the Comptrolier: and. Auditor General; and
(i) pensions to freedom fighters and pensions in lieu of resumed Jagirs, lands etc.; and
(c) the Department of Revenue and Banking except those relating to taxes, duties and other receipts and deposits realised under: any law for the time being in force and administered by the Department of Revenue and Banking including the Central Board of Direct Taxes and the Central Board of Excise and Customs.
2. This Order: shall come into force on the 1st day of October, 1976.
- VI. Copy of Order No. F. I (15)-B (A/cs) /76 dated 15th March, 1977 issued by the Government of India, Ministry of Finance (Department of Economic Affairs).
In exercise of the powers conferred by the first proviso to subsection (1) of: section 10 of the Comptroller and Auditor General's (Duties, Powers and Conditions of Service) Act, 1971 (56 of 1971), and in partial modification of the order of the Government of India in the Ministry of Finance (Department of Economic Affairs) No. F.1(15--B (A/cs) 176 dated the 8th September, 1976, the President, after consultation with the Comptroller and. Auditor General, hereby relieves the Comptroller and: Auditor General from the responsibility of compiling the: accounts relating to taxes, duties and other receipts and deposits realised or refunded under any law for the time being in force and: administered by the Department of Revenue and Banking including the Central Board of Direct Taxes and the Central Board of Excise and Customs.
2. This Order: shall come into force on the 1st day of April, 1977.
# VII. Copy of Order No. F.1(15)-B (A/cs) /76 dated 22-3-77 issued by the Government of India, Ministry of Finance (Department of Economic Affairs).
In exercise of the powers conferred by the first proviso to subjection (1) of: section 10 of the Comptroller and Auditor General's (Duties, Powers and Conditions of Service) Act, 1971 (56 of 1971). and in partial modification of the Order of the Government of India in the Ministry of Finance (Department of Economic Affairs) No. F.I (15)BB (A/cs) 176 dated the 8th September, 1976 and in continuation of the Order of the Government of India in the Ministry of Finance (Department of Economic. Affiars) No. F.1(15)- (A/cs)/76 dated 15th March, 1977, the President, after consultation with the Comptroller and. Auditor General, hereby relieves the Comptroller and. Auditor General from the responsibility for compiling-
the accounts of the Union' Territory of Delhi, and (ii the: accounts in respect of Central Government pensions, pensions to freedom fighters and pensions in lieu of resumed Jagirs, Lands, etc. payable or recoverable in the said Union Territory.
Subject: Grants-in-aid and loans sanctioned by various Ministries/ Departments of the Government of India to State/Union Territory Governments in connection with Central Plan Schemes and Centrally sponsored Plan Schemes.
Grants-in-aid and loans are given by various Ministries/Departments of the Government of India to State Governments/Union Territory Governments under Central Plan Schemes and also Centrally sponsored Plan Schemes. Many of the Central Plan Schemes/Centrally sponsored Plan Schemes are common to a number of States/Union Territories. In order to achieve uniformity in the accountal of such central grants/ loans in the books of all recipient State/Union Territory Governments, the following procedure shall be adopted:
2. Provisions for the release of grants-in-aid and loans to State/Union Territory Governments under Central Plan Schemes and Centrally-sponsored Plan Schemes: are made in the Union Budget comprising ( major/sub-major heads "3601/3602-GGantssiin-aid to State/Union Territory Governments" alongwith 'grants for Central Plan Schemes' or 'grants for Centrally Sponsored Plan Schemes' and under "7601/7602 Loans and Advances to State/Union Territory Governments" alongwith "Loans for Central Plan Schemes" or "Loans for Centrally Sponsored Plan Schemes' and
(i) minor heads thereunder with nomenciature designed in terms of paras 3.9: and 6.5 of "General Directions" contained in the List of Major and: Minor Heads of Account of Central and States. According to these paragraphs, the first portion of the nomenclature of the minor head is to indicate the function as per: sub-major head (or where a sub-major head does not give any: indication of the function e.g. General, the major head concerned is to be indicated in bracket; or in the absence of a sub-major head, function as per major head itself) on the revenue expenditure side and second portion is to indicate the programme minor head.
2. When a military Officer holding a civil post on consolidated pay which is less than his military pay is allowed to drawi the difference between them, he draws it from the department- Central or State- - from which he receives his consolidated pay.
2. For: the purpose of calculating Railway's share of cost of GRP the following will bei included:-
()) Pay: and: all types of allowances in respect of GRP: staff including office and supervisory staff upto the level of Superintendent of Police.
(i) Office expenses and contingencies.
(in) Cost of Pensionary charges.
(Iv) Cost of rent of buildings occupied by GRP staff:
In: addition to above, charges on account of medical reimbursement and medical allowances payable to staff, may also be considered in internal check for payment. However, charges on account of pay and allowances of medical staff viz. Doctors, Nurses etc. are not to be: shared.
The ollowing rules regulate the incidence of the cost of protecting Railway Bridges:-
(a) Protection of Railway bridges under normal condition is the responsibility of the concerned State Governments: and the expenditure incurred thereon will be borne by them.
(b) In the event of replacement of Police guard by military or other. Armed Forces of the Union:- ( When the services of the Military or other armed forces of the Union are placed at the disposal of the Railways at the request to the Railway Administration, the expenditure of the guards will fall upon the Railway. (i)) If the: substitution is made on general ground of Government Policy and: service is taken over by Defence Services, or otheri Public Service Department as part of the regular duties, the charges will be debited to Defence services or the Public department concerned, as the case may be.
VI. Principles relating to recovery of the cost of (1) Forest Surveys carried out by the Survey of India and (2) Forest maps prepared by: that Department.
Principles relating to recovery of the cost of (1) Forest Surveys carried out by: the Survey of India and (2) Forest maps prepared by that department are given in Chapter IX of the: Survey of India Handbook of Topography.
D. RECEIPTS
VII. Incidence of Leave Salary and Pension Contributions recovered in respect of Government servants lent on Foreign Service.
Contributions towards leave salary and pension recovered on behalf of a Government servant in foreign service are creditable to the Government (Central or State) under which he was permanently employed at the time of hist transfer to foreign service.
2. No contributions towards leave: salary and pensions shall be recoverable/payable among the departments of the Central Government including Railways, P&T: and Defence Department and departments of the Union Territories with or without legislature in respect of Government servants lent to or borrowed by these departments.
(This arrangement takes effect from 1st. January 1978).
Delete the words "Central transactions and' appearing between the words 'of and' "Union Territory' in line 1 and line 2 of this Rule.
- 2) Third sentence in Rule 12 Page 11 may be modified as below:
Transactions on behalf of State Governments arising in these treasuries shall be classified in the treasury accounts under: the head' 8658 - Suspense Accounts - Suspense Accounts (Civil) Accounts with Accountant General and settled in cash by exchange of cheques/demand drafts, as the case may be."
Delete the words 'other than transactions of Central (Civil) Pensions' appearing the line 11 and 12.
-
(ii) Substitute the sub-rule
(b) and
(c) with the following:-
(b) In the case of such transactions of the Central Government, including Railways / Postal I Defence Departments at State treasuries (both banking and non-banking), these shall be accounted for by the treasuries in the State Section of Treasury. Account under the head "PAO - Suspense - Transactions adjustable by PAO Ministry / Department of. below the Major head' '8658 - Suspense Accounts" for necessary cash settlement by the State Accountant General with the Pay and. Accounts Office.
(b) At present, some miscellaneous receipt and payment transactions (viz. payment of interest, repayment of principal on discharge of Central Government Securities and pensions including pensions to rreddo-tighterrs) take place at State treasuries. Such transactions shall be accounted: for by: thet treasuries in the State Section of Treasury accounts under the head "PAO Suspense - Transactions adjustable by PAO Ministry/ Department of below the major head '8658 - Suspense Accounts' for necessary cash settlement by the State Accountant General with the concerned Pay: and Accounts Office.
Note 1: In respect of payments pertaining to Central Government Securities, Principal Accounts Office, Department of Economic Affairs, New Delhi will bear the debits.
Note 2: In respect of Central (Civil) Pensions including High Court Judges and Freedom Fighters, the debits will be raised against the PAO in the Central Pension Accounting Office.
-
(ii) Sub-Rule
(f) - Page 15
(a) Delete the words 'at: State treasuries as' appearing between the words 'place' and' 'at' appearing in line 1 and 2.
(b) Put a full stop () after the word 'account' appearing in line 9 and delete the remaining words viz. in respect of transaction appearing in the Central Section of his accounts.
#
(ii) Sub-Rule
(i) - Page 16
Add the words 'kepiigg accounts of Union Territories' after the words Accountants General appearing in Line 4.
Note:- The Principal Director of Audit, Central, Calcutta and the Principal Accountant General (A&E) West Bengal will continue to maintain the Central Section of. Account till the switch over: of pension payment from treasury counter to Public Sector Bank is completed."
Correction Slip No.: 2 Dated: 2-8-1999
Appendix 5 - Page 97
Authority : T-14012/1/93-Coodes
Delete the words "ncluding travelling allowance" appearing in para1 of Part-B to. Appendix5.
(This takes effect from 1-4-99) (Authority: T-14012/1/98-Codes)