Para 10.11 — MSO

10.11 Borrowings.-Under Article 292 of the Constitution, the Union can raise money by borrowing upon the security of the Consolidated Fund of India within such limits, if any, as may from time to time be fixed by Act of Parliament. Under Article 293 of the Constitution, a State may borrow within the territory of India upon the security of the Consolidated Fund of the State within such limits, if any, as may from time to time, be fixed by the Act of the Legislature of the State subject to the condition that a State may not, without the consent of the Government of India, raise any loan if there is still outstanding any part of a loan made to the State by the Government of India or by its predecessor Government, or in respect of which a guarantee has been given by the Government of India or by its predecessor Government. A State Government may also obtain loans from the Government of India Subject to such conditions as may be laid down by or under any law made by Parliament. It is an important duty of the Accountant General (Accounts & Entitlement) to see that borrowings of a State Government are so regulated as not to exceed the limits fixed by the Legislature and that the conditions laid down by or under an

Act of Parliament are duly observed in respect of a loan granted by the Government of India to a State or guaranteed by it. In the case of loans raised by a State which can be done only within the territory of India or obtained by it from the Government of India, it should be watched that any conditions imposed by the latter Government in giving consent to raise a loan or in giving a guarantee in respect of a loan are duly complied with by the State Government.