Rule 263 - Loan Recovery | KartavyaDesk
Original Rule Text
Rule 263 The Administrative Ministries shall keep watch over the receipt of the Annual Statements in Form GFR 20 regularly from the Accounts Officer and conduct a close review of the cases of defaults in repayment of the installments of principal and/or interest due, as revealed from these Annual Statements and take suitable measures for enforcing repayments of the principal and interest due. If these statements are not received in time, the Accounts Officer shall be reminded promptly. To facilitate a proper review of the position of outstanding loans, the Ministries may also arrange to maintain centrally a list of all sanctions issued relating to loans advanced to State Governments and other entities.
What This Means
Rule 263 of the General Financial Rules (GFR) 2017 is all about keeping track of loans given out by the government. Think of it as ensuring that when the government lends money to states or other organizations, it gets paid back on time. The Administrative Ministries, which are the government departments responsible for these loans, need to actively monitor the repayment process. They do this by checking the Annual Statements in Form GFR 20, which the Accounts Officer provides. These statements show whether the borrowers are paying back their loan installments and interest as agreed.
The rule basically says that if a borrower is late on payments, the Ministry needs to step in and take action to get the money back. This could involve sending reminders, negotiating repayment plans, or even taking legal action if necessary. To make this process easier, the Ministries should also keep a central record of all the loans they've given out, so they can easily see who owes what and when payments are due. This helps prevent defaults and ensures that public funds are managed responsibly.
In essence, Rule 263 is about responsible lending and ensuring that the government recovers the money it lends out, so it can be used for other important public services.
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Key Points
- •Administrative Ministries are responsible for monitoring loan repayments.
- •Ministries must review Annual Statements (GFR 20) from Accounts Officers.
- •Action must be taken to recover overdue principal and interest payments.
- •Ministries should maintain a central list of all sanctioned loans.
- •Prompt reminders should be sent if Annual Statements are not received on time.
Practical Example
The Ministry of Rural Development sanctioned a loan of ₹50 crore to the State Government of Bihar for a rural electrification project. According to the loan agreement, Bihar is required to repay the principal and interest in quarterly installments over a period of 5 years. The Accounts Officer regularly submits the Annual Statement in Form GFR 20 to the Ministry. In the latest statement, it's revealed that Bihar has defaulted on two consecutive installments. The Under Secretary in the Ministry, Mr. Sharma, immediately sends a reminder to the State Government and initiates a meeting to discuss the reasons for the default and work out a revised repayment schedule. He also updates the Ministry's central loan register with the details of the default.
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Frequently Asked Questions
What is Form GFR 20 and why is it important?▼
Who is responsible for submitting Form GFR 20?▼
What actions can a Ministry take if a borrower defaults on loan repayments?▼
Why is it important for Ministries to maintain a central list of sanctioned loans?▼
What happens if the Accounts Officer doesn't submit the Annual Statement on time?▼
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 263 of GFR 2017, which entity is primarily responsible for monitoring the receipt of Annual Statements (Form GFR 20) and reviewing loan repayment defaults?
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