Para 16.1 — MSO (A&E)

16.1 Grants-in-aid can be given only to a person or body which is independent of the Government. One department of the Government cannot make a grant-in-aid to another department of the same Government. An organisation set up by a Government resolution or by an executive order does not have separate legal status of its own and functions only as a limb of the Government. Therefore, Government cannot give grant to such an organisation. A grant may be conditional or unconditional. 16.2 In regard to the regulation of the quantum of the grant-in-aid to State Governments for development schemes taking into account the miscellaneous receipts accruing there-form the Central Government has decided that-

(i) Where recurring grants-in-aid are given, the quantum of such grants should be based on the net expenditure arrived at by reducing gross expenditure by the amount of estimated receipts and

(ii) Where the grant-in-aid is of a capital nature (e.g. non-recurring grant for the construction of a building or acquisition of a machinery) not only the elements of possible receipts which would accrue to the State Government should be duly taken into account

- CHAPTER 16

# GRANTS-IN-AIDS

in determining the quantum of such grant-in-aid, but any receipts from the disposal of property built out of such grantsin-aid in respect of schemes which are closed or abandoned should also be shared proportionately. 16.3 Unless in any case the Government directs otherwise, every order sanctioning a grant shall indicate whether it is recurring or non-recurring in nature and specify clearly the objects for which it is given and the conditions, if any, attached to the grant. In the case of nonrecurring grants for specified objects, the order shall also specify the time limit within which the grant or each installment of it is to be spent. 16.4 In cases in which conditions are attached to the utilisation of grant in the form of specification of particular objects of expenditure or the time within which the money must be spent, or otherwise, the sanctioning authority shall be primarily responsible for certifying to the Accounts Officer, where necessary, the fulfilment of the conditions attaching to the grant, unless there is any special rule or order to the contrary. 16.5 In case of Central Government, it has been decided that grants-inaid for specific purposes in excess of Rs. 1 lakh per annum recurring and Rs. 5 lakh nonrecurring should normally be sanctioned by the competent authorities with the specific

NOTE:- Similar instructions laying down various limits have been issued by the various State Governments for the audit of the grantee’s accounts by the Comptroller and Auditor General.

What This Means

This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.

Key Points

• 1Grants-in-aid only for bodies independent of the granting government
• 2Govt departments cannot grant to other departments of the same government
• 3Organisations without separate legal status are treated as government limbs and are ineligible
• 4Recurring grants based on net expenditure (gross minus estimated receipts)
• 5Capital grants: disposal proceeds from abandoned scheme assets must be shared proportionately
• 6Grant sanctions must specify: recurring/non-recurring nature, object, conditions, time limits

Practical Example

This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.

Frequently Asked Questions

This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.