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Chapter 24  ||  Chapter 25  ||  Chapter 26  ||



Grants-In-aid  or contributions are generally paid to the following kinds of institutions viz: —


Educational and Medical Institutions;


Railway Institutes and Sports Clubs;


Railway co-operative  Societies;


Other local bodies or  institutions, e.g., Chambers of Commerce, Indian Institute of Engineers, &c. 


The powers to  sanction grants-in-aid or contributions are exercised by the authorities to whom such powers may have been delegated by the President from time to time. The following instructions may be followed by the sanctioning authorities in the matter of according sanctions for grants-in-aid:--


 Every order sanctioning the grant should specify clearly the object for which it is given, the recurring or non-recurring nature of the grants, the conditions,  attached and the time limit within which the grant is to be spent;


Before a grant is paid to the Railway Institutes or Sports Club or the  Railwaymen's Consumer Co-operative Societies, the sanctioning authority should see that an audited statement of accounts of the institution concerned has been received and that the grant-in-aid is justified by the financial position of the institution concerned, and that any previous  grant was spent for the purpose for which it was intended. In the case of Railway men’s Consumer Co-operative Society a certificate by the Registrar of Co-operative Societies concerned as to the satisfactory working of the Society would be a pre-requisite to the payment of subsidy.


Recurring grant exceeding Rs.1 lakh per annum and non-recurring grants exceeding Rs. 5 lakh should be sanctioned subject to the specific condition that the accounts of the institution receiving the grant will be subject to test check by the Railway Accounts Department, and the Comptroller and Auditor- General will also have the right to test audit, at his discretion, the accounts of the institutions to ensure that the grants are utilised for the purpose for which they are sanctioned.   


Educational Institutions:—(a) Grants-in-aid to non-railway schools may be sanctioned by the  General Managers in consultation with their financial Adviser and chief Accounts officers subject to the following being taken into account:—


Total number of students in the school.


The school must have children and wards of  Railway servants at least to the extent of 1/3rd of the pupils on its rolls or 100 pupils whichever is less.


The  schools should be fully recognised for all  purposes by the State Government concerned in accordance with their educational code, and should be in receipt of the full grant-in-aid as admissible under the Educational code.


A grant may be sanctioned only to such schools as are not able to balance their budget. The actual deficit and reasons for it should be looked into.   


It should be checked whether efforts have been made by the school to obtain additional assistance from the State Govt. and if so with what results. 


The amount hitherto granted from Railway revenues and the basis for it. 


The amount proposed to be granted from Railway revenues and the basis for it.


The  amount of grant-in-aid may be fixed on  ad hoc manner lent  in no circumstances should exceed the amount due on the basis of average “loss" per child (including both children of Railway employees and their wards)  nor should it exceed Rs. 8, Rs, 12, Rs.16 per pupil per month respectively from primary, Middle and Secondary/Senior Secondary Classes.

(No. E(W)78 SC 2-1 dt- 17-9-84)

(Authority Railway Board letter No. E(W)98ED2-9 dated 04.12.1998 )


The sanction should be on an annual basis and no element of non-recurring cost should be allowed.

Note-: (1) The grants- in-aid already being paid to non-railway schools will, however, continue to be paid so long as there is no substantial change in the circumstances. As the per capita grant is automatically modified by the fall or rise in the number of children of railway servants, no further revision will ordinarily be required in such cases unless there  is a substantial change in the other factors which were taken into account in deciding the rate of the per capita grant.

            (2) Non-Railway Schools (English Medium) catering to the needs of  the children and wards of Railway employees may  continue to be paid grants-in-aid as a measure of staff welfare even after 26-1-1960 by the General Managers in consultation with their Financial adviser and Chief Accounts Officers subject to the general  principle referred to above, If there are any cases where the existing grants sanctioned before 26.1.60 are in  excess may be withdrawn over a period  of three years from 15-2-62 in equal steps so as to minimise dislocation and inconvenience.  


Privately managed schools run by Railwaymen in Railway  Colonies:- 


In the event of need arising for additional school in the Railway colonies, Railway men should themselves organise and manage such schools as far as possible. For this purpose Railway Administrations may render suitable assistance to the managements. The nature of such assistance may be as follows:-

Non- recurring -


Railway men proposing to expand the existing school building or constructing new ones may be asked to raise some portion of the sum required for the purpose so that they may have a financial stake in the venture, financial assistance from the Railway being in the nature of a subsidy. Railway land where it can be spared may be licensed and spare Railway buildings may be leased on nominal rent. No compensation will be payable for any structures erected by the Licencee on the land,  if the Railway terminates the licence.


Furniture and equipment may also be purchased from Railway Revenues and donated to the private schools run by the railway men. The expenditure to be incurred, on this account may be equal to the amount proposed to be spent by the school for this purpose, subject to the condition that it does not exceed 50% of the amount that would have been spent by the Railway if the school had been established as a railway school. 

Recurring- The recurring assistance in the form of grant to these privately managed schools shall be in terms of clause (1) to (9) of sub-para (a) above. The condition that the school should be in receipt of full grant-in-aid from the State Government need not be insisted upon in making a recommendation to the Railway Board in case the school satisfies all other condition for assistance from the Railway.      


Before granting any assistance to a school a committee shall be formed of railways servants concerned who would be responsible for managing the affairs. For this purpose following steps shall be taken by the Railway Administrations:-


Railway administration shall be represented on the Managing Committee of each school run by the railway men. As far as possible a, Railway official shall be the Chairman of the Managing Committee, subject to the rules, if any, framed by the Education Department of the State Government in this regard;


In sanctioning the grants the Railway administration shall indicate to the school authorities the condition stipulated in para 2071-GI and keep in view the provision of para 2072-GI for conducting checks as and when necessary;


These school should be regularly visited/inspected by the Education Officer/Railway official on the  same lines as the Railway managed school and any short-comings reported by these officials should be brought to the notice of the Managing Committee of the school so that these could be removed. In the event of the Managing Committee not being amenable to the advice of the Railway administration in the affairs of the school, it shall be open to the administration to withhold temporarily or permanently all subsidies, grants and aids.


Medical Institutions-(a) The grant depends on the average number of railway patients getting benefit from that institution in a year, the per capita cost of medicines based on the actual expenditure of the institution  over all the patients treated and the amount proposed  to be recovered from the Railway administration.


In the case of Tuberculosis Sanatoria, where beds are reserved for the use of railway servants and  their families , the Railway's share of expenditure is based on the average actual cost incurred during the preceding two or three years on the maintenance of beds, diet provided and ordinary medical and nursing attention. In some cases it may also include the cost of special drugs. The Railway's share of expenditure is subject to Railway Board's approval.


Railway Institutes and Clubs.—Maximum limits have been laid down for the expenditure which may be incurred in any financial year by the Railway Administrations. If, in any, year, the actual expenditure exceeds these limits the excess should be reported to the Railway Board. These monetary limits have been fixed with particular reference to the total number of Railway servants on each Institute or club is generally based on the  financial position of the Institute, as certified by tie Accounts authorities. 


Railway men's Consumers Cooperative Societies.—A subsidy amounting to not more than half the administrative and establishment charges incurred by the Society for the first three years is paid by the  Railway Administration subject to the condition that the Co-operative department of the State concerned  certifies that the Society is working satisfactorily.  Such a society is eligible for the subsidy during the first three years, irrespective of the fact whether they  work at a profit or loss. The different items that may be included in the Administrative and establishment charges for the purpose of determining the amount of subsidy to be granted to these institutions are enumerated in Chapter XXIII.


Other Local Bodies etc.—The grant is not subject to any general conditions but is governed by the special requirements of each case. This grant should, however, be non-recurring and subject to the following general conditions, viz.     


That the grant will be spent on the object for which sanctioned within a reasonable time if no time-limit has been fixed by the sanctioning authority;


That any portion of tile grant, which is not ultimately required for expenditure upon that ob­ject, shall be surrendered to Government; and   


That the authority, sanctioning the grant reserves  the right to arrange for the inspection of the records of the recipient institution.

Note.—The expression "reasonable time" occurring in item (i) above should in actual practice ordina­rily be interpreted to mean one year from the date of issue of  the letter sanctioning the grant.


The sanctioning authority should also take into account the under mentioned conditions: —


It should be ensured by issue  of a certificate that the conditions precedent to the grant have been fulfilled. For this purpose target, dates should be prescribed for submission of audited statements of accounts by the grantee institutions etc. to the sanctioning authority. In every case of grant made for specific purposes a certificate of its actual utilisation should  be furnished by the sanctioning authority to the FA. & C.A.O. within a date stipulated for the purpose.


Grants may be sanctioned to meet the requirements of a year even extending beyond the fin­ancial year, but only so much of the grant should be paid during the financial year as is likely to be expended during that year. The amount remaining unspent at the end of the year in such case need not be refunded at the close of the financial year. In such cases sanctions should be so drafted that they may not lapse at the close of the financial year. Immediately on  the expiry of one year from the date of the sanction, any unspent balance there of should be duly surrendered to the sanctioning authority as  required in paragraph 2408. (ii). However, In respect of sanctions which require the grant to be utilised during a financial year, the unspent balance thereof should never the less be surrendered to the sanctioning authority at the end of the financial year or may be adjusted, by the sanctioning authority against the next year's grant, if any. It should be clearly stated In each sanction letter that the unspent balance of the previous grant has either been surrendered to Government or that it  has been taken into account in sanctioning the subsequent grant. 


Grants-in-aid to small institutions, which are entirely mainly fed by recurring grants and which are likely to utilise the entire grant by the close of the financial year and would not thus have sufficient funds to cover their expenses at the beginning of the next financial year, pending receipt of fresh grants, should be paid, during the financial year, if necessary, in three installments, viz.,first one in April itself, the second one sometime during May to September and the final one during October or later so as to ensure even flow of funds at their disposal during the year. In the case of these institutions, submission of audited statements of accounts required in terms of paragraph 2402(b) above need not be insisted upon for sanctioning payment of the first two installments of the grant, if such statements are not ready. However, such statements of accounts in respect of the previous financial year should, as required in para 2402 (b) above be called for while sanctioning the final installment unless the institution concerned has been specifically exempted from furnishing them.


With a view to avoiding irregularities and double payments, etc., the following instructions should be strictly observed by the sanctioning authority in connection with sanction and payment of grants- in-aid to public bodies or institutions:-


Once a grant-in-aid has been sanctioned, it is the responsibility of the grantee to prepare and submit the bill in the prescribed form to the countersigning authority for signature and the Accounts Officer for payment. In no case therefore, should the office of sanctioning authority do this work on behalf of the grantee. There is, however, no objection to the grantee being guided in the preparation of the bill, such guidance being restricted to the supply of blank form and indication of the particulars to be filled in.   


Before a bill is accepted, it should be particularly  seen that the conditions if any, attached to the grant have been accepted by the grantee without any reservation.


 A register of grants in  Form No. 87 of Appendix. 9 should be maintained.  Columns (1) to (V) of the Register should be filled in simultaneously with the issue of the order sanctioning each grant and attested by the Section Officer concerned. The serial numbers should be recorded on the body of the original sanction letter at the time the item is entered in the Register, as under:--

"Noted at Serial No............... in the Register of grants”

    Columns (VI) and (VII) should be filled in and attested by the Section Officer concerned as soon as the bill is received from the grantee. The bill should then be submitted to the countersigning authority with the Register for countersigning the bill and for giving his dated initials in Column (VIII) of the Register.