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Rule 141 - Project Review | KartavyaDesk

GFR 2017

Original Rule Text

Rule 141 Review of Projects. After a project costing Rs. 100 crore or above is approved, the Administrative Ministry or Department will set up a Review Committee consisting of a representative each from the Administrative Ministry, Finance (Internal Finance Wing) and the Executing Agency to review the progress of the work. The Review Committee shall have the powers to accept variation within 10% of the approved estimates. For works costing less than Rs. 100 crore, it will be at the discretion of the Administrative Ministry/Department to set up a suitable mechanism for review and acceptance of variation within 10% of the approved estimates.

What This Means

Rule 141 of the General Financial Rules (GFR) 2017 deals with the review of government projects. Essentially, it mandates a formal review process for projects that have a sanctioned cost of ₹100 crore or more. This review is conducted by a committee established by the Administrative Ministry or Department overseeing the project. The goal is to monitor progress and ensure the project stays on track financially. For smaller projects (below ₹100 crore), the ministry has the flexibility to decide whether or not to establish a similar review mechanism.

The core function of the Review Committee is to assess the project's progress and, importantly, to approve minor cost variations. Specifically, the committee can approve changes to the project's budget, but only up to a maximum of 10% of the originally approved estimate. This allows for some flexibility in managing unforeseen expenses or minor adjustments without requiring a completely new approval process. This rule impacts all government departments and agencies involved in managing and executing projects, especially those exceeding ₹100 crore.

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

Key Points

  • •Mandatory Review Committee for projects costing ₹100 crore or more.
  • •Administrative Ministry/Department sets up the Review Committee.
  • •Review Committee includes representatives from the Administrative Ministry, Finance (Internal Finance Wing), and the Executing Agency.
  • •The Review Committee can approve cost variations up to 10% of the approved estimates.
  • •For projects under ₹100 crore, the review mechanism is at the discretion of the Administrative Ministry/Department.

Practical Example

The Ministry of Rural Development approved a project to build a rural road network in Uttar Pradesh at a cost of ₹120 crore. Following Rule 141, the Ministry established a Review Committee consisting of an officer from the Ministry itself, a representative from the Internal Finance Wing, and a senior engineer from the National Rural Infrastructure Development Agency (the executing agency). During the project's execution, unexpected increases in material costs led to a projected cost overrun. The Executing Agency presented the revised estimates to the Review Committee. The committee reviewed the reasons for the cost increase and, finding them justified, approved a variation of ₹8 crore (less than 10% of the original estimate), allowing the project to continue without further delays.

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 the cost variation exceeds 10%?▼
If the cost variation exceeds 10%, the Review Committee cannot approve it. A revised proposal with detailed justification must be submitted for fresh approval from the competent authority.
Who is responsible for ensuring the Review Committee is set up?▼
The Administrative Ministry or Department responsible for the project is responsible for setting up the Review Committee promptly after the project is approved.
Does Rule 141 apply to all types of government projects?▼
Yes, Rule 141 applies to all types of government projects that meet the specified cost thresholds (₹100 crore or more for mandatory review).
What is the role of the Internal Finance Wing representative in the Review Committee?▼
The Internal Finance Wing representative ensures that the financial aspects of the project are properly managed and that any cost variations are justified and within budgetary constraints.
What documentation is required for the Review Committee to approve a cost variation?▼
The Executing Agency must provide detailed documentation justifying the cost variation, including reasons for the increase, supporting data, and revised estimates.

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

As per Rule 141 of GFR 2017, for a project costing ₹120 crore, which entity is responsible for establishing the Review Committee?

Related Rules

Rule 271General Financial Rules 2017 (amended July 2024) - Rule 271 - Chapter 10Rule 109General Financial Rules 2017 (amended July 2024) - Rule 109Rule 146General Financial Rules 2017 (amended July 2024) - Rule 146 - Chapter 6Rule 169General Financial Rules 2017 (amended July 2024) - Rule 169 - Chapter 6Rule 215General Financial Rules 2017 (amended July 2024) - Rule 215 - Chapter 6

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