Rule 125 - Inter-Departmental Adjustments | KartavyaDesk
Original Rule Text
Rule 125 Inter-departmental and other adjustments to be made in the account year. Under the directions contained in the Account Code for Accountants General, Inter-departmental and other adjustments are not to be made in the accounts of the past year, if they could not have been reasonably anticipated in time for funds being obtained from the proper authority. In all cases, where the adjustment could have reasonably been anticipated as, for example, recurring payments to another Government or department and payments which, though not of fixed amount, are of a fixed character, etc., the Accounts Officer will automatically make the adjustment in the accounts before they are finally closed. The onus of proving that the adjustments could not have been reasonably anticipated should lie with the Controlling Officer.
What This Means
Rule 125 of the General Financial Rules (GFR) 2017 deals with how government departments handle financial adjustments between themselves and with other entities. Basically, it says that if a department owes money to another department or entity, and they knew about it or should have known about it in time to get the funds approved, they need to make the adjustment within the same financial year. This prevents departments from pushing expenses into the next year's budget unnecessarily. It ensures accurate accounting and prevents budget manipulation.
The rule emphasizes timely action and accountability. If an adjustment isn't made within the year, the department responsible has to prove they couldn't have reasonably anticipated the expense. This places the burden of proof on the Controlling Officer, who is responsible for managing the department's finances. This rule applies to all government departments and agencies, and it's particularly relevant for those involved in inter-departmental transactions or recurring payments.
In essence, Rule 125 promotes financial discipline and transparency by ensuring that financial obligations are settled promptly and that departments are held accountable for their financial planning and forecasting.
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Key Points
- •Inter-departmental and other adjustments must be made within the same financial year if reasonably anticipated.
- •The Accounts Officer will automatically make adjustments for recurring payments or payments of a fixed character.
- •The onus of proving that adjustments could not be reasonably anticipated lies with the Controlling Officer.
- •The rule aims to prevent delaying expenses to the next financial year.
- •This rule promotes financial discipline and accountability in government departments.
Practical Example
The Department of Agriculture (DoA) regularly purchases fertilizer from the Department of Fertilizers (DoF). For the financial year 2023-24, the DoA purchased fertilizers worth ₹50 lakhs in March. The DoA had budgeted for this purchase and had received the invoice from DoF well before the end of the financial year. According to Rule 125, the DoA must make the payment and adjust the accounts within the same financial year (2023-24).
However, if the DoA suddenly needed to purchase an additional ₹10 lakhs worth of a specialized fertilizer in late March due to an unexpected pest outbreak, and they didn't have time to get the funds approved before the financial year ended, they might be able to justify delaying the adjustment to the next financial year. However, the Controlling Officer of the DoA would need to provide documentation proving that the need for this additional purchase was unforeseen and that obtaining funds in time was impossible.
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Frequently Asked Questions
What happens if an adjustment is not made within the financial year?▼
Who is responsible for ensuring compliance with Rule 125?▼
Does this rule apply to all types of inter-departmental transactions?▼
What constitutes a 'reasonably anticipated' expense?▼
Where can I find more information about the Account Code for Accountants General mentioned in the rule?▼
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 125 of the General Financial Rules, 2017, inter-departmental adjustments that could have been reasonably anticipated should be made:
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