Para 2.2.20 — MSO (Audit)
Original Rule Text
2.2.20 A Grant or Appropriation is intended to cover all the charges, including the liabilities of past years to be paid during the financial year or to be adjusted in the accounts of that year. It is operative until the close of that year. Any unspent balance lapses and is not available for utilisation in the following year.
Note: The expenditure recorded against a Grant or Appropriation should ordinarily represent sums actually paid within the financial year. However, various special arrangements are in operation in terms of which expenditure actually incurred in the previous years is recorded against a Grant or Appropriation of the current year. In general, these arrangements are at variance from the strict constitutional theory of parliamentary financial control.
What This Means
A Grant or Appropriation covers all charges for a financial year, including past liabilities paid in that year. It is valid only until March 31 -- any unspent balance lapses and cannot be carried forward. However, some special arrangements allow previous years' expenditure to be recorded against the current year's Grant, though such arrangements deviate from strict constitutional financial control principles.
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Key Points
- 1Grants cover all charges including past-year liabilities paid during the year
- 2Grants are operative only until March 31 -- unspent balances lapse
- 3Lapsed funds cannot be used in the following year
- 4Special arrangements allow recording prior-year expenditure against current grants
- 5These special arrangements deviate from strict constitutional theory
Practical Example
A department has a Grant of Rs 100 crore for the current year. By March 31, it has spent only Rs 85 crore. The remaining Rs 15 crore lapses automatically and cannot be spent in April or later. If the department has an unpaid contractor bill from the previous year for Rs 2 crore, it can be paid from the current year's Grant since grants cover past liabilities paid during the year.
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Frequently Asked Questions
Can unspent budget be carried forward to the next year?▼
Can past years' bills be paid from the current year's Grant?▼
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.