Rule 70 — GAR
Original Rule Text
70. Items of receipts and payments which cannot: at once be taken to a final head of receipt or charge owing to lack of information: as to their nature or for any: other reasons, may be held temporarily under the major head "8658-Suspense Account" in the: sector "L. Suspense andi Miscellaneous" of the Accounts, (Footnotes under: the major head in the list of major/minor heads of account may be referred to fort further guidance). A service receipt of which full particulars are not given must not be taken to the head "Suspense Account" but should be credited to the minor head "Other Receip!" under the revenue major head to which it appears to belong pending eventual transfer to the credit of the correct head on receipt of detailed particulars.
NOTE:- No sums should ordinarily be credited to Government by debit to a suspense head credit must follow and not precede actual: realisation.
Sale-proceeds of Government land and Buildings
What This Means
Rule 70 establishes the framework for using the 'Suspense Account' head in government accounting. A Suspense Account is used to temporarily hold receipts or payments when the full classification details are not yet available — for example, when money is received but its nature cannot immediately be determined, or when a payment has been made but its correct final head is still being worked out.
The rule specifies that such items may be held temporarily under major head '8658-Suspense Account' within the 'L. Suspense and Miscellaneous' sector of the accounts. Once the details become available, the amounts are transferred to the correct final heads. The rule also contains an important restriction on service receipts (government income from services rendered): a service receipt for which full particulars are not yet given must NOT be taken to the Suspense Account. Instead, it must be credited to the 'Other Receipts' minor head under the revenue major head that it appears to belong to, pending transfer to the correct head once details are received.
The Note to Rule 70 contains a fundamental safeguard: no amount should ordinarily be credited to Government by debiting a suspense head. The credit (receipt into government accounts) must follow actual realisation of money — not precede it. This prevents fictitious credits to government revenue through suspense debit entries.
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Key Points
- 1Suspense Account (major head 8658) temporarily holds receipts and payments whose final classification is not yet determinable.
- 2Once classification details are available, the items are transferred from 8658 to the correct final head.
- 3Service receipts with insufficient particulars must go to 'Other Receipts' under the appropriate revenue major head — NOT to the Suspense Account.
- 4Critical safeguard: Credit to Government must follow (not precede) actual realisation — no fictitious credits via suspense debit.
- 5Suspense accounts are a temporary holding mechanism, not a permanent parking ground — items must be cleared promptly.
- 6Relevant to all PAOs, treasury officers, and departments receiving money whose classification is initially unclear.
Practical Example
A PAO receives a bank draft of Rs. 3.8 lakhs from a private contractor as part payment of a penalty, but the remittance advice accompanying the draft is illegible — it is unclear whether this is for a penalty under a specific construction contract (debitable to PWD) or a procurement penalty (debitable to the purchasing Ministry). Until the details are confirmed, the Rs. 3.8 lakhs cannot be credited to its correct final head. Under Rule 70, the PAO credits the amount to major head '8658-Suspense Account' temporarily. Within a few days, the contractor's office sends a clear remittance note confirming it is a penalty under PWD contract No. XY/2025. The PAO then transfers the Rs. 3.8 lakhs from the Suspense Account to the appropriate receipt head under the PWD major head. At no point is the Suspense Account used to create a fictitious credit — the money is already physically in the bank before any accounting entry is made.
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Frequently Asked Questions
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This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.