Para 17.1 — MSO

17.1 The Government of India releases each year assistance in the form of grants and/or loans to various States/Union Territories Governments for various central and centrally sponsored schemes in accordance with the pattern specified in the sanctions relating to the Schemes. While on certain schemes the entire expenditure is borne by the Government of India, on others the expenditure is shared between the Union and State Government. For State plan schemes the assistance takes the form of block grants which is related to the total outlay approved for the State Plan as a whole by the Planning Commission without linkage with individual schemes except to the extent of certain earmarked categories like power, major irrigation schemes, rural water supply etc.

The grants are accounted for under the major head of account “1601- Grants-in-aid from Central Government” and the loans are taken to the Major Head of Accounts, “6004-Loans & Advances from Central Government” Repayment of Loans is also shown under “6004-Loans and Advances from Central Government” in the books of the Accountant General.