Deposit Accounts........................

Deposit Account

1. Deposit Accounts Mandatory Training for AAOs to be empanelled for promotion as SAOs Day 11 Session 1 Accounts Stream

2. Session Overview In this session, we will discuss: Types of Deposits. Personal Deposits and Ledger Accounts. Plus and Minus Memorandum. Lapsed Deposits.

3. Learning Objective By the end of the session, the participants will be familiarized with the types of Deposit Accounts, Personal Deposits and Ledger Accounts, Plus and Minus Memorandum and Lapsed Deposits.

4. References MSO (A&E) Vol.-I. Receipts and Payments Rules, 1983.

5. Introduction Moneys received to be held as deposits with Government should be by virtue of a statutory provision or of general or special orders of Government or authorized to be held in the custody of the Government. Subject to the above, no money is to be credited as a deposit except under the formal order of a court or other competent authority.

6. Introduction …Contd. No pay, pension or other allowances should be placed in deposit on the ground of the absence of the payee or any other reasons. No fines should be placed in deposit on the ground that appeal is pending, except for compensation fines (including costs in criminal cases) due to an injured party and not to Government, which may be kept in deposit, both in appealable and non-appealable cases, till they lapse under any rules. No refunds can be drawn to be lodged in deposit pending demand by the payee. No jewels or other property received for custody and restoration in kind may be brought on the deposit account, though the value be stated in money. Government Promissory notes or other security deposits (not being cash) received must, on no account, be credited as deposits.

7. Repayment of Deposits Repayment of deposits can be made only on the receipt of the persons entitled to them, against Application-cum-Bill in Form G.A.R. 43. The bill should be duly supported by the challan with which the money was credited to Government Account and Departmental Receipt, if any, issued to the party. AG should examine that there are proper vouchers in support of the amount repaid and should check each repayment against the original receipt either individually or against the total credit in a particular account in order to see that repayments do not exceed the amount originally received and credited to Government.

8. Classification of Deposits Moneys received for deposit in the Government Account are broadly classified under suitable Head of Accounts appearing under two broad categories under Sector K – ‘Deposits and Advances’ of Public Accounts as follows: 1. Deposits Bearing Interest 2. Deposits Not Bearing Interest 8336 Civil Deposits 8443 Civil Deposits 8337 Deposits of Railways 8444 Defence Deposits 8338 Deposits of Local Funds 8445 Railway Deposits 8342 Other Deposits 8446 Postal Deposits 8447 Telecommunications Deposits 8448 Deposits of Local Funds 8449 Other Deposits

9. Classification of Deposits …Contd. Money received at the Treasury for deposit in the Government account are classified according to the department through which they are received, the usual classes being: Revenue Deposit; Civil Court Deposits; and Criminal Court Deposits. Another important class is ‘Personal Deposits’ of which the account kept at the treasury is of the nature of a banking deposit account, the receipts and payments being recorded in Personal Ledgers. Other classes of deposits may be added under special orders of the Government.

10. Personal Deposit Account Personal Deposit Account is a device intended to facilitate the administrator thereof to credit receipts into, and effect withdrawals directly from, the account subject to an overall check being exercised by the bank in which the account is authorized to be opened, to ensure (with the help of a Personal Ledger account to be maintained by the bank for the purpose) that no withdrawal will result in a minus balance. Personal Deposit Accounts, also known as Personal Ledger Accounts broadly fall into two categories, viz., those operated by withdrawing from the Consolidated Fund of the State and those in the Public Account. The opening of a Personal Ledger Account by withdrawing from the Consolidated Fund of the State requires the approval of the State Government in consultation with the Accountant General.

11. Personal Deposit Account …Contd. P.L. Accounts by withdrawal from the Consolidated Fund can be opened in special circumstances when normal procedure of drawal from the Treasury by presentation of bills proves unworkable in respect of any special scheme under taken by the Government. Further, such scheme should have gross working expenses of an amount exceeding Rs. 5 lakhs in a year and should have considerable receipts.

12. Personal Deposit Account …Contd. The Personal Ledger Accounts under the Public Account are opened after the sanction of the Government is issued in consultation with the Accountant General. The creation of this facility was aimed at giving more flexibility to Drawing & Disbursing Officer to ensure implementation of government policies in a time bound manner. It was actually intended to give support to the Head of Departments for speedier implementation of policies/projects . Every Personal Deposit Account so authorized to be opened will form part of the Government Account and be located in the Public Account portion.

13. Personal Deposit Account …Contd. Personal deposit accounts are generally authorized to be opened in the following types of cases: In favour of an administrator appointed for the purpose of administering moneys tendered by or on behalf of ward and attached estates under Government Management. In relation to Civil and Criminal Courts’ deposits, in favour of the Chief Judicial authority concerned. Where, in certain regulatory activities of the Government, receipts are realized and credited to a Fund or Account under the provisions of an Act to be utilized towards expenditure thereunder and no outgo from the Consolidated Fund is involved.

14. Personal Deposit Account …Contd. Where a personal deposit account is required to be created by a law or rules having the force of law and certain liabilities devolve on the Government out of the special enactments. Officers commanding units and others concerned in the administration of public funds or regimental funds in the Defence Departments can be authorized to open personal deposit accounts for such funds.

15. Personal Deposit Account …Contd. A personal deposit account of type other than (a), (b), & (c) mentioned earlier may be authorized to be opened only under the special order or permission of the Ministry or Department concerned in consultation with the Controller General of Accounts. Such special order or permission may be issued or granted by the Ministry or Department concerned after satisfying itself that the initial accounts of the money to be held in a personal deposit account and disbursed, are arranged to be maintained properly and are subject to audit. The Principal Accounts Officer of the Ministry or Department concerned shall also be consulted for the purpose.

16. Personal Deposit Account …Contd. Every personal deposit account so authorized to be opened will form part of the Government Account and be located in the Public Account portion thereof. The scrutiny of withdrawals in the case of Personal Deposit is confined to seeing that there are proper paid cheques in support of the withdrawals.

17. Accounting procedure of PLA Where the Personal Deposit Accounts are created by transferring funds from the Consolidated Funds, should be closed at the end of the financial year by minus debit of the balance to the relevant service heads in the Consolidated Fund, the Personal Deposit Accounts being opened next year again, if necessary in the usual manner.

18. Accounting procedure of PLA …Contd. The scrutiny of withdrawals in the case of Personal Deposit is confined to seeing that there are proper paid cheques in support of the withdrawals. In cases where Civil or other Courts open Personal Deposit Account with Treasury, they themselves keep the detailed account of Deposits and submit the Statement of Lapses to the Accountant General instead of the Treasury doing so.

19. Plus and Minus Memorandum The deposit checker must be careful to see that the receipts, repayments and balances are correctly brought forward in the Plus and Minus Memorandum which are received from the Treasury in respect of each class of deposits vide Article 120 of the Account Code Volume II and specially that any lapsed items are correctly written off. Plus and Minus Memoranda should be prepared in Form T.A-46 for the transactions on account of each class of deposits. Each head of deposit should be detailed separately in the appropriate Memorandum.

20. Plus and Minus Memorandum …Contd. The balance in the Plus and Minus memorandum of deposit transactions for the month of April should be reduced by the amount reported for lapse under Article 127 so that it may agree with the aggregate of repayable deposit balances upon the deposit register. The entries in each memorandum should be checked by the Accountant, Special attention being paid to balances as a precaution against any fund overdrawing its amount. The memoranda should then be posted in Broadsheets, one for each minor head under deposit.

21. Plus and Minus Memorandum …Contd. The deposit checker must be careful to see that the receipts, payments and balances are correctly brought forward in the Plus and Minus Memorandum which are received from the Treasury in respect of each class of deposits and specially that any lapsed items are correctly written off. It should also be seen that the closing balance for March agrees with that of the Proof-Sheet.

22. Lapsed Deposits At the close of March each year: Deposits not exceeding twenty-five rupees unclaimed for one whole account year, or residuary balances not exceeding the said amount out of deposits partly repaid during the year; and All deposits or balances more than twenty-five rupees, unclaimed for more than three complete account years. Shall be credited to the Government under the Consolidated Fund, keeping the necessary note in the register of deposits. In case of the deposits, the detailed accounts of which are kept by departmental officers, a list of deposits and balances thus lapsing shall be prepared by them and sent to the Accounts Officer in accordance with the relevant directions.

23. Lapsed Deposits …Contd. The age of a repayable item, or of a balance in it, may be reckoned as dating from the time when the item or the balance, as the case may be, was initially deposited. In the case of certain departments such as CPWD and Salt Department, which maintain detailed account of deposits themselves, the age for the purpose shall be reckoned with reference to the provisions in the concerned authorized departmental regulations. The Government may, in relation to any particular class of deposits, issue orders varying or relaxing any of the conditions or limitations specified in the preceding sub-rules.

24. Procedure for Repayment of Lapsed Deposits Deposits where the detailed accounts are required to be kept by the departmental officer and which are credited to Government cannot be repaid without pre-check by the Accounts Officer. Deposits which are kept in the accounts office and which are credited to the Government may be refunded on receipt of an application-cum-bill in Form GAR 46 along with the original challan or departmental receipt as the case may be. The repayment of lapsed deposit shall be recorded in the appropriate register of receipts so as to guard against a second payment.

25. When application is made for refund of a lapsed deposit, a note of it should be made against the entry of the deposit in the Statement of Lapses. The Officer who signs the order for refund should also initial the entry of refund order in the Statement of Lapses. The fact of payment should be noted in the number book of the orders, Form 13 and the AAO should initial the entry in the prescribed column. Procedure for Repayment of Lapsed Deposits …Contd.

26. Procedure for Repayment of Lapsed Deposits …Contd. In the case of repayments of deposits which are made after the original Deposit Registers of Receipts have been destroyed, the check of the refund will be confined to seeing that a lapsed deposit of the particular amount in question, is actually outstanding in the Statement of Lapses, the verification of the claimants' title to the refund being left to the authority who signs the application for refund. In the case of lapsed deposits paid without pre-check by the Accountant General under orders of Government, a note of the refund should be made against the entry of the deposit in the Statement of Lapses. It should be also seen that the item was really received, was carried to credit as lapsed and drawn by a person who might have drawn it any time before the lapse.

27. Thank You