A number of modifications and articles pertaining to numerous facets of India’s political and economic structure are consolidated in the country’s constitution. Various public funds are specified in relation to the federal government and state government in the Indian constitution.
The Indian economic system‘s financial management is strengthened by all public monies.All public monies are maintained using sophisticated internal controls and accounting procedures, as stated in the Indian constitution. With well-managed and well-designed procedures, the Indian economic system has comprehensive control over the accounting system.The text that follows goes into great detail on public funds and also provides a quick overview of public provident funds.
Public Funds in the Indian Government
Government and those working for the federal government and state governments depend heavily on accounting and financial management. The three main categories of public monies that India uses to maintain its financial and economic infrastructure are listed in its constitution. The mentions are as follows:
- Article 266 (1) of the Indian Constitution mentions consolidated funds.
- Article 266 of the Indian Constitution mentions the public account of India.
- Article 267 (1) of the Indian Constitution mentions the contingency fund.
As was already noted, the Indian financial and economic systems are supported by three public funds. The Indian constitution defines every facet of public finances along with their limits and limitations. According to the Indian constitution, each account is required to have a certain set of rules and restrictions. Additionally, the accounts function inconsistently as the authority and duties for particular management and tasks are withheld.
India’s Public Account
Flows for transactions where the government just acts as a banker are tracked by the Public Account of India. According to the Constitution‘s Article 266(2), this fund was created. This money does not belong to the government. Furthermore, payments from the Public Account do not require parliamentary approval. For instance, funds from small savings plans, public provident funds, etc. are put in these public accounts. India’s primary categories of public accounts are:
- Small savings deposits, such as the Sukanya Samridhi Yojana and National Savings Certificate, are among them.
- Deposits of state provident funds and private provident funds are included in this category.
- Transactions are posted to suspense and miscellaneous accounts before they are categorized as permanent transactions.
- Deposits and advances are transactions in which the government is required to reimburse funds or has a right to demand payment.
- Remittances – A remittance is money that is transferred to pay for something. The GDP of India is significantly influenced by remittances.
Public Provident Funds: The National Savings Institute of the Ministry of Finance developed the Public Provident Fund, also known as PPF, as a means of saving in 1968. It is a specific kind of Indian public account. The balance of a PPF account is entirely tax-free.The public provident fund program is fully guaranteed by the federal government.Its main objective is to encourage individuals to save small sums of money by offering a secure investment with tax advantages. The balance in a PPF account is not subject to attachment by a court order or judgment, as per the Government Savings Banks Act of 1873. On the other hand, the government might seize the account to recover unpaid taxes through Income Tax and other departments.