3.1 As a general rule, in the departmentalised system of payment all payments are to be made only by the Pay & Accounts Offices of the Ministry/Department after proper pre-check. However, as a partial exception to this rule, the drawing and disbursing officers of offices which are not located at the same station as the Pay & Accounts Office, may be permitted to draw funds directly from the local branches of the bank accredited to the Ministry/Department concerned by means of cheques, for payment of pay and allowances (including travelling allowances and medical claims-both advances and final bills) and office contingencies. Bills for other kinds of payments will be presented to the Pay and Accounts Office concerned for pre-check and payment by bank drafts. Such bills shall in no case be paid directly by the DDO.
NOTE 1 :- The term `Office Contingencies' referred to above should be interpreted in a restricted way so as to cover only those items which would fall within the sanctioning power of the DDO as well as certain periodical payments like rent, rates and taxes, electricity, water and telephone charges and the other day-to-day office expenses.
NOTE 2 :- In the case of some departments,claims of other specified nature may also be authorised to be paid direct by DDO in consultation with the Controller General of Accounts.
3.2 Each of these Drawing & Disbursing Officer, hereinafter referred to as Cheque-Drawing DDO, will be placed in account with the local branch of the Reserve Bank of India/State Bank of India or its subsidiary/Public Sector Bank accredited to the Ministry/Department concerned by means of a quarterly letter of credit opened in his favour by the Pay & Accounts Officer concerned. The Cheque-Drawing DDO will draw cheques only on the branch/branches of the RBI/SBI or its subsidiary or the public sector bank, with which he is placed in account and the bank will make payment of cheques upto the limit prescribed in the letter of credit. The DDO should keep a close watch over the drawals and should take prompt action for the renewal of the letter of credit by assignment of additional funds by PAO,when needed.
NOTE 1 :- The fresh letter of credit/assignment issued after the expiry of the period prescribed in the earlier letter of credits/assignment within the same financial year will be treated as an addition to the unspent balance of the previous letter of credit/assignment. The Pay & Accounts Officer while communicating the letter of credit/assignment for the second and subsequent quarters would indicate not only the amount assigned for that quarter, but also the progressive total of letter of credit/assignment upto the end of the quarter so that the bank is enable to ensure that the total cumulative drawals from the beginning of the year do not exceed the total progressive amount of letter of credit/assignment.
NOTE 2 :- A letter of credit or assignment shall lapse at the close of the financial year and shall not be carried forward to the first quarter of the next year. The cheques actually issued during the last quarter but presented for payment during the next quarter, (within the period of validity) will be taken by the bank against the assignment of the year to which they were drawn and not against the assignment of the year in which they are paid.
NOTE 3 :- A drawing officer in whose favour a letter of credit or assignment has been issued is not permitted to draw the whole amount and place it in a separate drawing account of the bank or in a private account.
NOTE 4 :- It is not also permissible to draw cheques and deposit the amount in the department's cash chest at the end of the year for avoiding a lapse of grant.
3.3 In some cases, the Cheque-Drawing DDO at a station may also be permitted to make payments on account of pay and allowances etc. and office contingencies of one or more offices, in addition to his own, situated in the same station or near about. The heads of such offices will present the bills on account of pay and allowances and office contingencies to the designated cheque drawing DDO for payment.
3.4 In addition to pay and allowances and office contingencies,as referred to in para 3.1 above, Cheque-Drawing DDOs are also authorised to make payments by cheques, of the claims of the following categories after sanction of the competent authority to the same is obtained, a copy of which should be sent to the Pay & Accounts Office :-
(a) Final payment of GPF moneys to and withdrawals of moneys from GPF for Group `D' Government servants.
(b) All short-term loans and advances to Government servants (i.e. those recoverable in less than 60 instalments).
NOTE 1 :- Cheque-Drawing DDOs are not authorised to issue cheques for drawal of advances (in respect of Government servants other than Group 'D') in terms of Rule 34(3)(v) of GPF(CS) Rules. Bills for the purpose, duly supported by formal sanction of the competent authority, should be forwarded to the Pay & Accounts Office for payment after precheck.
NOTE 2 :- The amount of quarterly assignments against which DDOs are authorised to issue cheques will take into account the anticipated drawals on account of the advances mentioned above.
NOTE 3 :- Bills for payment of long-term loans and advances and for withdrawals from provident fund, (in respect of Government servants other than Group 'D') under Rules 15 and 16 of General Provident Fund (Central Services) Rules 1960 or corresponding provisions of other provident fund rules, shall be paid only by the Pay & Accounts Office on the basis of the sanction of the competent authority. Such payments should, in no case be made by the DDOs by issue of cheques against their assignment.
3.5 In the case of Provident Fund advances paid by the Drawing & Disbursing Officer, a statement of the amounts paid and the particulars of the sanction, names of subscribers, their account numbers, etc. should be forwarded to the PAO every month, to enable the latter to ensure that the debit vouchers are received and posted in the accounts of the subscribers and that the debits adjustable by Accounts Officers of other Departments/Governments are passed on to them without fail.
3.6 The bills relating to the above mentioned classes of payments will be prepared in accordance with the rules and procedures prescribed in CGA (R&P) Rules/GFRs etc. (See Chapter 2) and presented to the cheque-drawing DDO for check and payment. In so far as the bills of his own office are concerned, the Cheque-Drawing DDO will ensure that, to the extent possible, the bills are got checked independently by a person other than the one responsible for the preparation of the bills.
3.7 The bills received for payment (including those pertaining to his own office) will be checked by the Cheque-Drawing DDO to ensure that they relate only to classes of payments which he is empowered to make by issue of cheques as mentioned in para 3.1 to 3.4 above. Bills which do not fall under these categories, if received, will be returned to the office concerned for transmission to the Pay & Accounts Office for pre-check and payment. After this preliminary verification the bills will be entered in the ` 'Register of Bills received' in form CAM 18 (Appendix I).
3.8 The bills will then be subjected to usual prescribed checks enumerated in the CGA (R&P) Rules and para 3.3.2 of CAM. Inter alia, the bills shall be arithmetically checked and examined with a view to seeing that the claim is admissible, the authority good, the signature and counter-signature where necessary are genuine and in order, and corrections, if any, have been duly attested. After satisfying himself in all respects, the cheque-drawing officer will sign the pay order on the bill showing the amount for which the bill is passed in words and figures and deface the Pay order. It should also be ensured that the quarterly assignments as intimated by Pay & Accounts Office in respect of each office are not exceeded. The cheque will then be prepared for the net amount of the bills.
[The provisions contained in Rule 42 ibid should be observed while writing cheques]
3.9 The number and date of the cheque issued and particulars of bills,etc. will be noted in the `Register of cheques issued' in form CAM 19 (Appendix 2) and the entries will be attested by the Cheque Drawing DDO at the time of signing each cheque. The date of encashment of each cheque should also be entered in this register and the entries attested by the Cheque-Drawing DDO. All the entries in this register should also be subjected to independent check by another officer (preferably a Gazetted Officer) against the relevant passed documents/vouchers. The register should be closed for each day either on the same day or on the commencement of the following day.
3.10 Cheque-Drawing DDOs shall prepare a list of payments in triplicate in the prescribed form CAM 21 (Appendix 3) at the end of every week. Two copies of the list of payments accompanied by the paid vouchers, schedules etc. should be sent to the Pay & Accounts Office on the due dates as mentioned below:-
|1st to 7th||by the 9th of the month|
|8th to 14th||by the 16th of the month|
|15th to 21st||by the 23rd of the month|
|22nd to the end of the month||by the 3rd of the following month|
3.11 The Cheque-Drawing DDOs should prepare a bank reconciliation statement every month vide para 3.14 infra and send it to the Pay & Accounts Officer.
NOTE - Sub vouchers upto Rs. 100 in value shall be retained by the cheque drawing officers in their offices vide Rule 111(3) of CGA (R&P) Rules and these would be examined at time of internal/local audit of their initial records.
A certificate shall be recorded by him on each contingency bill, to the effect that sub-vouchers of value upto Rs. 100 numbering from sub-vouchers .....................to sub voucher......................have been retained in the office.
3.12 In the case of officers rendering accounts on the Public Works/Forest system, the dates for submission of compiled accounts to the Pay and Accounts Office shall be the 7th of the succeeding month.
3.13 The paying branch of the bank will prepare daily scrolls of payments DDO-wise but as the number of cheques drawn by the cheque drawing DDOs will be few, the payment scrolls will be transmitted weekly i.e.on every Saturday, in duplicate, by the paying branch, covering the transactions from Monday to Saturday along with paid cheques to the concerned Pay & Accounts Office, and a copy of the scroll (without paid cheques) simultaneously to the Cheque-Drawing DDO concerned.
3.14 The scrolls received from the Bank should be checked with reference to the Register of Cheques issued in respect of the name of the payee and the amount of cheque paid. Date of encashment should be noted in the relevant column of the Register of Bills and the Register of Cheques. A bank reconciliation statement (CAM 20) should be drawn up every month explaining the difference between total payments made as per the Bank's scroll and the total payments during the month as per the Register of Cheques, indicating the details of the cheques issued during the month but not encashed and cheque issued in earlier months cashed during the month. Discrepancies, if any, noticed in the scrolls should be taken up with the Bank immediately.
3.15 All cheques shall be drawn by the Cheque-Drawing DDOs on forms in cheque books to be supplied to them by the Pay & Accounts Offices concerned. The instructions contained in CGA (R&P) Rules in regard to cheques and cheque books etc. should be carefully observed by the cheque-drawing officers. Some of the important instructions are indicated in the ensuing paragraphs.
3.16 Cheque books shall, on receipt, be carefully examined by the drawing officer who should count the number of forms contained in each and record a certificate of count on the flyleaf.
3.17 The loss of cheque books or a blank cheque form shall be notified promptly to the branch of the bank with whom the disbursing officer concerned has a drawing account.
3.18 All cheques towards payment of personal claims of Government servants, contractors, suppliers and public sector companies and corporations shall be drawn as payable to an order of the payee. Such cheques shall be crossed with the subscription "Account Payee only'' whenever the amount exceeds Rs. 1000/- in regard to salary cheque or wherever the amount exceeds Rs.500/- in respect of non-salary cheques. Such non-salary cheque for an amount not exceeding Rs. 1000/- may however, be issued as open cheques if so desired by the payee but only as order cheque. It should be ensured that no payee makes it a practice to get an uncrossed cheque in his favour as a matter of course.
3.19 There is no ban on cheques being drawn for less than Rs. 10/-. However, in the case of the postal transactions, the lowest sum for which the cheque may be issued is Rs. 100/-
3.20 All corrections and alterations in a cheque shall be attested by the drawing officer by his full signature.
3.21 Cheques shall be payable at any time within three months after the month of issue; thus, a cheque bearing any date in January is payable at any time upto 30th April. Should the currency of a cheque expire owing to its not being presented at the Bank within the period specified above, it may be received by the drawer who should then destroy it and issue a new cheque in lieu thereof. In the event of non-return of the time-barred cheque to the drawer, the drawer should, on the expiry of the prescribed period of three months after the month of issue of the cheque, require the payee either to return the cheque or explain the causes for its non return. If, as a result of this enquiry the cheque is reported as lost, the bank drawn on should be requested to stop payment and issue an advice in accordance with the procedure laid down in Paras 3.23 to 3.25 infra.
3.22 When it is necessary to cancel a cheque, the cancellation must be recorded on the counterfoil, and the cheque, if in the drawer's possession, must be destroyed. If the cheque is not in the drawer's possession, after satisfying himself with reference to his records (namely payment and error scrolls and register of cheques delivered) that it has not been paid, he should promptly send an intimation, by registered post (AD) to the branch bank on which it is drawn to stop its payment. In case of Cheque-Drawing DDO's the PAO should also be informed. A cheque remaining unpaid for any cause for six months after the month of its issue should be cancelled and, after the Accounts Officer/Cheque-Drawing DDO has satisfied himself of its non-payment, the amount should also be written back in the account.
3.23 When a Cheque-Drawing DDO report to the paying branch of the bank about a cheque having been lost, the latter shall record a `Stop' against the cheque and issue an acknowledgement in the following form :-
"We acknowledge receipt of your letter No...................................... dated.........................and advice having noted to stop payment of cheque No ..............................................dated.............................for Rs.....................................Rupees................................................favouring.................................. In this connection, it is certified that cheque No........................................... dated............................................for Rs................................... reported by the drawing officer to have been drawn by him on this Bank in favour of .............................will not be paid if presented thereafter". A copy of this acknowledgement should be sent by the Cheque drawing DDO to the PAO concerned to enable him to issue a non-payment certificate to the DDO in the following form :- "Certified that cheque No...........................dated............................ for Rs........................................reported by (the drawing officer) to have been drawn by him on ............................................... branch of ..................................................Bank in favour of ......................................has not been paid''.
3.24 The Cheque-Drawing DDOs should note particulars of the non-payment certificate received by him against the relevant entry in the office copy of the list of payments, on the counterfoil of that cheque and office copy of the relevant paid voucher before issuing a fresh cheque in lieu thereof. The party requesting the issuance of a fresh cheque in lieu of the lost one, should execute an Indemnity bond in Form GAR 12 (Appendix 4). However in the case of a Government Department, Public Undertakings wholly owned by Government or a bank, the execution of such an indemnity bond is not necessary but a fresh cheque should, in these cases, be issued only on receipt of a certificate that the cheque alleged to have been lost, and further that it will be returned to the cheque-drawing DDO, if found afterwards. The number and date of the fresh cheque will also be noted on the list of payments, paid vouchers and counterfoil of the old and cancelled cheque.
3.25 If the original cheque is found to have been paid afterwards, the DDO should report the matter immediately to the paying branch and inform the PAO accordingly by a telegram for further action.
3.26 Every Cheque-Drawing DDO who is authorised to draw cheques on a bank shall send specimen of his signature to the bank (and also to the Accounts Officer) through some superior officer or predecessor whose specimen signature is already with the Bank. When such an officer makes over charge of his office to another, he shall likewise send a specimen of the signature of the relieving officer to the Bank and Accounts Officer concerned.
3.27 Specimen signature when forwarded on a sheet of paper other than the forwarding letter itself, must be duly attested by the officer signing the forwarding letter.
3.28 The Cheque-Drawing DDO shall notify to the bank branch upon which be draws,the number of each cheque book which,from time to time, he brings into use and the number of cheques it contains.
3.29 The Cheque should contain the name of Ministry/Department of the Government of India and the code number assigned by the bank for easy identification. The name of the station/name of the office/branch of the bank and the designation of the officer signing the cheque should either be printed or affixed by means of a rubber stamp, on the cheque itself.
3.30 Cheque-Drawing DDOs will requisition their requirement of cheque-books from the Pay & Accounts Office concerned. The latter will supply to the Cheque-Drawing DDO the minimum number of cheque books, sufficient for his requirement for three months. The cheque books will remain in joint custody of the cheque-cashier and the Cheque -Drawing DDO. The stock of blank cheque books should be stored in a steel almirah in double lock of which one key should be kept by the Cheque-Drawing DDO and the other by the cheque-cashier. The duplicate set of keys should be kept in an envelope sealed by the Cheque-Drawing DDO and the cheque cashier in the custody of the Head of Office/Principal Accounts Office.
NOTE 1 :- If the double lock system for custody of cheque books is not feasible in any office owing to the smallness of the establishment or lack of facilities, the cheque books should be in the custody of the Head of the Office under lock and key. The Head of the Office will be responsible for their safe-custody and issue, to the cashier as and when required, of the required number of cheque books.
NOTE 2 :- In cases where the power of drawal of funds by cheques is withdrawn from any Cheque-Drawing DDO, all the unused forms from partly used cheque books with that officer should be defaced by writing the word "Cancelled'' prominently across each cheque form and its counterfoil (but without the signature of the Drawing Officer) and returned to the PAO concerned. All unused cheque books should however, be returned by the Drawing Officer to the PAO without any cancellation.
3.31 A Stock register of cheque-books/forms should be maintained in form CAM-1 (Appendix 5) to keep an account of the receipts, issues and balance of cheque-books/forms. Each morning, the cheque-cashier should take such cheque books from the Cheque-Drawing DDO as are likely to be used during the course of the day, and should remain responsible for their use and returns of the balance at the close of the day. An account of cheque forms and daily should be maintained by the Cashier in Form CAM 2 (Appendix 5) and submitted to the Cheque-Drawing DDO at the time of closing of the accounts daily. In this register, the cheque numbers used during the day should also be noted.
3.32 Every six months, in April and October, stock taking of the cheque books should be done by an officer other than the Cheque-Drawing DDO and a certificate of physical count recorded by him in the stock register. This stock-taking should also be done whenever there is a change of the Cheque-Drawing DDO and the relieving officer should initial the entry in respect of each of the cheque book noted in form CAM 2 (Appendix 6) and sign a certificate in the stock register in the following form:-
"Received the current cheque books as indicated by my initials in the register of account of cheque forms and the unused cheque books from ................ to.............. as entered in the Stock Register''.
Physical verification can be entrusted either to the Inspecting Officer of the Internal Inspection Party conducting the normal inspection of his office or by any gazetted officer of his Department who vistits that office in any other official work.
3.33 The cheques to be used by Cheque-Drawing DDOs will be of three kinds:-
(i) Negotiable:- For payments of personal claims of Government servants, pensioners, contractors suppliers and public sector companies and corporations. These will be drawn as payable to or order of the payee. As a safeguard against fraudulent payments all non-salary cheques in excess of Rs. 250 and salary cheques in excess of Rs. 1,000 will be crossed and marked "Account Payee only''. A distinct format for this type of cheque bearing the words "Pay to ................. or order'' on its body has been approved by the Controller General of Accounts for use by cheque-drawing DDOs.
NOTE :- It is permissible to pay the salaries and allowances etc.,of the Government servants by cheque,if the Government Servant so opts. The option in this regard will however, be exerciseable in March every year for the ensuing financial years. Payments other than of salary will also be made by the same mode of payment as of salary.
However, in cases where salary is paid in cash, other payments like house building advance, etc. may be made by cheques if these are large and are specifically required in writing to be made by cheque.
(ii) Not Transferable :- These cheques are to be drawn in favour of Government officers responsible for disbursement of salaries etc. of office establishment and payments on account of office contingencies. These cheques should, therefore, be drawn in favour of the Payee by his official designation and should contain the superscription 'Not Transferable' on the top and should be drawn as payable to the Payee only and not 'to Order'. These cheques are not negotiable and payments will be made only to the payee or to his messenger holding a letter of authority on proper identification.
A distinct format of this type of cheque with the superscription "Not Transferable'' has been approved by the Controller General of Accounts for use by the Cheque-Drawing DDO's.
(iii) Not negotiable and not payable in Cash-Creditable to Government account only:- Cheque drawn in favour of Government offices or Departments or payments on account of inter-departmental or inter-Governmental dues e.g. telephone bills etc., shall be crossed and the words "For credit to Government account and not payable in Cash'' written between the lines.
The distinct format for this type of cheques, bearing the superscription "Government Account'' has been approved by the Controller General of Accounts for use by the Cheque-Drawing DDOs. These special cheques forms, therefore, do not require to be crossed.