Rule 246 — This rule explains who needs to follow specific fi
Original Rule Text
Rule 246 The rules in this Section shall be observed by all authorities competent to sanction loans of public moneys to State Governments, Local Administrations of Union Territories, local bodies, foreign Government on specific recommendation of State Government, Government institutions and other Government bodies.
What This Means
This rule explains who needs to follow specific financial guidelines when approving loans that use public money. Essentially, any government official or department that has the authority to sanction, or approve, a loan using funds from the government treasury must strictly adhere to all the rules laid out in this particular section of the General Financial Rules.
These rules apply when loans are given to a variety of government-related entities. This includes other State Governments, the local administrations of Union Territories, and various local bodies such as city corporations or village councils. It also covers loans provided to government-run institutions and other organizations that are part of the government framework.
An important point to note is that if a loan is to be given to a foreign government, it can only proceed if an Indian State Government specifically recommends it. In summary, this rule ensures that all government bodies involved in lending public money, whether to domestic or certain international entities, follow a consistent set of financial guidelines to ensure transparency, accountability, and responsible use of public funds.
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Key Points
- 1This rule applies to all government authorities empowered to approve loans using public funds.
- 2These authorities must strictly follow the financial rules detailed in this specific section of the General Financial Rules.
- 3The rule covers loans provided to State Governments, Union Territory administrations, and local bodies.
- 4It also includes loans to various government institutions and other government-related organizations.
- 5Loans to foreign governments are permissible only if an Indian State Government provides a specific recommendation.
- 6The primary objective is to ensure responsible and accountable lending of public money by government entities.
Practical Example
Imagine the Ministry of Finance is reviewing a request for a significant loan. The Department of Economic Affairs within the Ministry receives an application from the 'Gujarat State Road Development Corporation,' a state government institution, seeking funds for a major highway expansion project. At the same time, the department is also considering a proposal to provide financial assistance to the 'Municipal Corporation of Bhopal' for a new waste management initiative.
Before approving either of these loans, the Joint Secretary (Public Debt Management) in the Department of Economic Affairs, who is the 'authority competent to sanction loans,' must ensure that all procedures outlined in Rule 246 and its accompanying section are meticulously followed. This involves verifying the financial health of the applicants, assessing the project's viability, ensuring proper documentation, and adhering to all prescribed terms and conditions for lending public money. For instance, they would check if the Gujarat Corporation has submitted all required financial statements and if the Bhopal Municipal Corporation has provided a detailed project report. Failure to observe these rules could lead to financial irregularities and accountability issues for the sanctioning authority.
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.