Article 266(2) of the Indian Constitution mentions the Public Account of India. It deals with funds wherein the Government performs the duty of a banker. It is one of the two funds where all money received by or on behalf of the Government of India is credited. The other fund is the Consolidated Fund of India.
All transactions dealing with debts other than those included under the Consolidated Fund of India fall under the Public Account Fund.
Under this Public Account, debt, deposits and advances related transactions are those where it is the Government that incurs a liability for repayment of money received; or a claim to recover the amounts paid.
These funds under Public Account do not belong to the government. It has to be eventually paid to the rightful owners once it reaches the period of maturity.
Example of funds kept in Public Account
- Small savings,
- Provident funds,
- Pre-deposits under income tax,
- Moneys received by an officer or Court in connection with affairs of the Union
Can funds be withdrawn from the Public Account without prior authorization?
Yes, prior authorization for payments are not required for withdrawing funds from the Public Account as the receipts under this account do not constitute normal receipts.
What is the difference between the Public Account fund and the Consolidated Fund?
Public Account and Consolidated Fund both deal with money received on or behalf of the government but when it comes to the requirement of prior authorisation, there is a difference. Any withdrawal from Consolidated Fund requires prior authorisation from the Parliament. As far as the Public Account is concerned, no such authorization required.
What is the difference between the Public Account Fund and the Contingency Fund?
The Contingency Fund of India has been created with an aim to meet the unforeseen expenditure from time to time. So the amount that would be needed at any given point cannot be anticipated. The corpus for the central government under this fund is Rs 500 crore. Whenever money is withdrawn from this fund, the same amount is appropriated after parliamentary authorization to maintain the minimum corpus.
It is here where the difference lies between Contingency Fund and Public Account. Under Public Account, the approximate amount of money withdrawn can be anticipated to an extent but the same is not true for the Contingency Fund. Further, parliamentary authorization is required post withdrawal from the Contingency Fund unlike the Public Account where no authorization is required as already mentioned above.
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