CHAPTER XVI

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Appropriation and finance accounts and audit reports thereon

175. Appropriation and Finance Account :The Appropriation and Finance Accounts and the Audit Reports thereon are prepared by the Comptroller and Auditor-General of India for each year in accordance with the provisions of Indian Constitution and procedure laid down by Comptroller & Auditor General of India. Their object is to present the audited accounts of all the expenditure of the year, whether voted or charged, in the form of a separate Appropriation account for each Grant/Charged Appropriation, with any important observations which it is considered necessary to make as a result of the audit investigation. They also include the comments deemed to be necessary to make upon the result of the audit of trading, manufacturing and profit and loss accounts and balance-sheets kept in respect of Government commercial or quasi-commercial concerns and upon the examination of accounts of receipts and of stores and stock. In order that only agreed statements of facts and completed cases are included in the reports, a convention exists between the Comptroller and Auditor-General and the State Government whereby cases relating to any previous year which become ready for inclusion after the last report was written are included in the report of a subsequent year.

176. The Auditor General of India also compiles the Finance Accounts of the State Government in respect of each financial year. This compilation presents the accounts of the receipts and outgoing of the Government for the year, together with a report on the financial results disclosed by the different accounts and other data coming under examination ; that is to say, both the revenue and capital accounts, the accounts of the debt and the liabilities and assets of the Government as deduced from the balances recorded in its books and other information.

177.Preliminary action in Finance Department on receipt of appropriation and Finance Accounts and Audits Report thereon: On receipt of the authenticated copies of the Appropriation and Finance Accounts and the Audit Reports thereon, in terms of the provisions of Article 151 (2) of the Constitution, from the Comptroller and Auditor General of India, the Finance Department will obtain the orders of the Governor for laying the copies before the Legislature and then move the Legislative Department to arrange for the item relating to the laying of these documents before both the Houses of the Legislature being included in the agenda of business of the Houses.

178 Reference to the committee on Public accounts:

(i). After the Appropriation Accounts and the Finance Accounts and the Audit Reports thereon are laid on the table of the House, they shall stand referred to the Committee on Public Accounts for examination and report.

(ii) If they are received by the Assembly Secretariat at a time when the Assembly is not in session, then these may be referred to the Committee on Public Accounts by order of the Speaker.

179. The Committee on Public Accounts is a Committee of the Legislative Assembly and is constituted under Rules of Procedure and Conduct of Business of the U.P. Legislative Assembly.

180. Constitution and function of the committee on Public Account :

The constitution and functions of this Committee are described in rules 230 and 231 of the Rules of Procedure and Conduct of Businesses of the U.P. Legislative Assembly 1958, which are reproduced below for ready reference:

Committee on Public Accounts

"230. Constitution of the Committee. –

(1) There shall be a Committee on Public Accounts for the examination of the Reports of the Comptroller and Auditor General of India relating to the Appropriation Accounts of the State, the annual financial accounts of the State or such other accounts or financial matters as are laid before it or referred to it or which the committee deems necessary to scrutinise.

(2)The Committee in Public Account shall consist of not more than 21 members who shall be elected by the House every year from amongst its members according to the principle of proportional representation by means of the single transferable vote.

(3)Provided that no Minister shall be appointed a member of the Committee and if a member of the Committee is appointed a Minister he shall cease to be a member of the Committee from the date of such appointment.

(4)The Chairman shall be elected by the Committee from amongst its members.

231. Functions of the Committee.—

(1) In scrutinising the Appropriation Accounts of the State and the report of the Comptroller and Auditor General of India it shall be the duty of the Public Accounts Committee to satisfy itself—

(a)that the money shown in the accounts as having been disbursed were legally available for and applicable to the service or purpose to which they have been applied or charged ;

(b)that expenditure conforms to the authority which governs it : and

(c)that every re-appropriation has been made in accordance with such rules as may be prescribed by the competent authority.

(2) It shall also be the duty of the Public Accounts Committee—

(a)to examine the statement of accounts showing the income and expenditure of State Corporations, trading and manufacturing schemes and projects together with the balance-sheets and statement of profit and loss accounts which the Governor may have required to be prepared or are prepared under the provisions of the statutory rules regulating the finances of a particular corporation, trading concern or project and the report of the Comptroller and Auditor General thereon ;

(b)to examine the statement of accounts showing the income and expenditure of autonomous and semiautonomous bodies the audit of which may be conducted by the Comptroller and Auditor General of India either under the directions of the Governor or by a statute, and

(c)to consider the report of the Comptroller and Auditor General in case where the Governor may have required him to conduct an audit of any receipts or to examine the accounts of stores and stock."

181. The other general rules of procedure applicable to the Committee on Public Accounts as well as to the other Committees of the Legislative Assembly are contained in Rules 201 to 223, of the Rules of Procedure and Conduct of Business of Uttar Pradesh Legislative Assembly, 1958, except Rule 202 (1) which does not apply to the Committee on Public, Accounts in view of the provisions of Rule 230 (3). (See Appendix H).

182. The Comptroller and Auditor General of India, or his representative the Accountant General, U.P. and the Finance Secretary or his representative are invited to attend the meetings of the Committee. These officers may offer their advice on any matter which comes under discussion.

183. The Committee is entitled to offer criticism and make recommendations or suggestions upon any matter discussed in the Appropriation and Finance Accounts and the Reports thereon received from the Comptroller and Auditor-General of India in respect of both receipts and expenditure (voted or charged) or any other matter referred to it by Government or examined by it on its own motion.

184.Presentation of committee’s Report before the Legislature:

The report of the Committee on Public Accounts will be presented to the Assembly by the Chairman of the Committee. Thereafter copies of the report will be sent by the Assembly Secretariat to the Administrative Departments of the Secretariat for taking necessary action on the recommendation of committee and also to the Accountant’s General, U.P., the Finance Department, the Comptroller and Auditor-General of India, other States and the Government of India, for information. Action taken by the Departments concerned on the recommendations of the Committee shall be communicated by them to the Assembly Secretariat, the Finance Department and the Accountant General :

Provided that the Committee may, if it so desires, direct that any of its recommendations be sent to the department concerned for immediate necessary action without waiting for the report to be presented to the Assembly. In such a case, a copy of recommendation of the Committee shall also be sent to the Accountant General and the Finance Department for information. Action taken by the department concerned on such a recommendation shall be communicated by the department to the Assembly Secretariat, the Finance Department and the Accountant General.

185. The departments and officers concerned shall keep secret all papers concerning the action taken on the recommendations of the Committee sent to them in advance till the report is laid on the table of the Legislature.

186. Action to give effect to the recommendations of the Committee and of the Legislative Assembly will be taken by the departments concerned but the Legislative Assembly Secretariat is responsible for seeing that such action has been take.

187. A memorandum showing the action taken, or proposed to be taken, on the recommendations of the Committee by the various departments of the Government shall be prepared by the Assembly Secretariat in consultation with the Finance Department, and shall be placed before the Committee. The Committee after considering it may make such recommendations as may seem necessary and submit its report to the House.

188. The Committee will examine the replies regarding the action taken and will report to the House in its next report whether it considers the action taken by the departments to be adequate or otherwise.

189.Accountant General’s comment on the action taken on committee’s recommendation:

The Accountant General in the next and subsequent Appropriation Accounts and his reports thereon and the Comptroller and Auditor-General of India in his comments on those Accounts may refer to the action which has been taken by the Government in respect of cases previously reported by him and may comment on the adequacy or otherwise of the action taken by the Government.

190. Excess Grants : The procedure for dealing with the demands for excess grants has been described in Section IV of Chapter XIV.