Rule 314 - Local Body Funds | KartavyaDesk
Original Rule Text
collected by Government for or on behalf of local bodies shall not be appropriated direct to a local fund without passing them through the Consolidated Fund unless expressly authorised by law. Rule 315 Payments to Local Bodies. Subject to provision of relevant act and rules, payments to local bodies in respect of revenue and other moneys raised or received by Government on their behalf will be made in such manner and on such date, as may be authorized by general or special orders of Government. Rule 316 Audit of Account of Local Bodies. Subject to the provisions of any law made under Article 149 of the Constitution, the accounts of local bodies, other nonGovernment bodies, or institutions will be audited by the Indian Audit and Accounts Department under such terms and conditions as may be agreed upon between the Government and the Comptroller and Auditor General of India. Rule 317 Audit Fees. Audit fees on the basis of daily rates prescribed by Government in consultation with the Comptroller and Auditor General of India from time to time shall be charged by the Indian Audit and Accounts Department for the audit of local and other non-Government funds, excluding funds for the audit of which the rates of fees recoverable are prescribed by law or by rules having the force of law. Provided that nothing contained in this rule shall be held to override any special instructions of Government exempting any particular local body or institution wholly or partially from the payment of audit fees. Rule 318 In the case of Government Companies, the recovery of the cost of Supplementary Audit conducted under Section 143(6) of Companies Act, 2013 as amended from time to time, should be waived in those cases where the audit is done by the Comptroller and Auditor General through his own departmental staff but should be enforced in cases where the Comptroller and Auditor General employs professional auditors for the Supplementary Audit. Rule 319 Financial transactions between Government and local bodies shall be rounded off to the nearest Rupee. VIII. MAINTENANCE OF RECORDS Rule320 (1) Destruction of Records. Subject to any general or special rules or orders applicable to particular departments as prescribed in their departmental manuals, no Government record connected with
What This Means
Rule 314 of the General Financial Rules (GFR) 2017 is all about how money collected by the government on behalf of local bodies (like municipalities or panchayats) is handled. Think of it like this: if the central or state government collects taxes or fees that are actually meant for the local municipality, this rule dictates where that money goes first. The rule states that this money can't be directly transferred to the local body's fund. Instead, it must first go through the Consolidated Fund of India (or the relevant state's Consolidated Fund). This ensures proper accounting and oversight. The only exception is if a specific law explicitly allows for direct transfer.
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Key Points
- •Money collected by the Government for local bodies must first go through the Consolidated Fund.
- •Direct transfer to local funds is prohibited unless explicitly authorized by law.
- •This rule ensures proper accounting and oversight of funds.
- •The rule applies to all revenue and other moneys raised or received by the Government on behalf of local bodies.
Practical Example
The Ministry of Rural Development collects a 'Rural Infrastructure Cess' as part of the Goods and Services Tax (GST). A portion of this cess is earmarked for funding infrastructure projects in various Gram Panchayats across the country. According to Rule 314, the collected cess cannot be directly transferred to the individual Gram Panchayat funds. Instead, the collected amount is first deposited into the Consolidated Fund of India. Subsequently, the Ministry, following established guidelines and budgetary allocations, releases funds to the State Governments, who then disburse the money to the respective Gram Panchayats for their approved infrastructure projects. This ensures that all funds are properly accounted for within the government's financial system.
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 the Consolidated Fund of India?▼
Are there any exceptions to Rule 314?▼
Why is it important to route funds through the Consolidated Fund?▼
Who is responsible for ensuring compliance with Rule 314?▼
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 314 of GFR 2017, funds collected by the Government on behalf of local bodies should generally be routed through which fund before reaching the local body?
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