Rule 257 — GFR

Rule 257 Installments of Loans. When a loan of public money is taken out in installments, each installment of the loan so drawn shall be treated as a separate loan for purposes of repayment of principal and payment of interest thereon except where the various installments drawn during a financial year are, for this purpose, allowed to be consolidated into a single loan as at the end of that particular financial year. In the latter event, simple interest at the prescribed rate on the various loan installments from the date of drawal of each installment to the date of their consolidation shall be separately payable by the borrower. Repayment of each loan or the consolidated loan, as the case may be, and the payment of interest thereon shall be arranged by the borrower annually on or before the anniversary date of drawal or consolidation of the loan in such number of installments as the sanctioning authority may prescribe. The sanctioning authority may allow, in deserving cases a moratorium towards repayment of principal but not for the payment of interest. Should it appear that there is an undue delay on the part of the debtor in taking out the last installment of a loan the authority sanctioning the loan may at any time declare that loan closed, and order repayment of capital to begin. The Accounts Officer shall bring to notice any delay that appears to him to require this remedy and he shall take this step whether or not there are any dates fixed for taking of installments. NOTE1. These instructions are applicable mutatis mutandis to loans, the repayments of which are made by other than annual installments. NOTE 2. It must be remembered that the calculation fixing the amount of equal periodical installments, by which a loan is repaid with interest, presupposes punctual payment of the installment and that, if any installment is not punctually repaid, the interest amount shall need to be recalculated.