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Sanction of loans and Advances – timely and regular recoveries of the same. In this connection attention is drawn to various provisions stipulated in the (official digest)

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Official Railway Board digest, not the complete circular. Sanction of loans and Advances – timely and regular recoveries of the same. In this connection attention is drawn to various provisions stipulated in the

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Sanction of loans and Advances – timely and regular recoveries of the same. In this connection attention is drawn to various provisions stipulated in the (official digest)

RBE No. 138/2002 Date: 2002-08-19 Official source: https://indianrailways.gov.in/railwayboard/uploads/directorate/establishment/order_july-sep.jsp

Official Railway Board digest - gist only, not the complete circular.

Reference: F(E)Spl.2002/ADV.2/1 dt. 19.8.2002

Sanction of loans and Advances – timely and regular recoveries of the same. In this connection attention is drawn to various provisions stipulated in the extant rules for timely and regular recovery of advances, some of which are highlighted below:- i) In case of railway employee who has been sanctioned an advance for purchase of a conveyance, does not complete the purchase and pay for the conveyance within one month of the drawal of advance, he shall refund forthwith the full amount of advance drawn together with interest thereon for one month. However, a competent authority, in exceptional cases, may extend the period of one month prescribed in this rule up to two months. (Ref. Sub Para (5) of Para (1108 of IREM). ii) When the advance is retained beyond one month without purchase of the vehicle, penal interest will be chargeable. Also failure to produce the registration book of the vehicle within one month of purchase of within two months of drawal of advance will render to Railway servant liable for levy of penal interest. (Ref.1108(5) note (ii) of IREM). iii) It is mandatory that the sanction for all types of advances must stipulate the chargeable rate of interest at 2-1/2% above the prescribed rate of interest, clearly indicating that in case all terms and conditions attached to the sanction, including those relating to the recovery of amount, are fulfilled completely to the satisfaction of the competent authority, rebate of interest to the extent of 2-1/2% will be allowed. (Ref.Bd’s Letter No. F(E)Spl.80.ADV2/5 dt. 5.1.1981) iv) In the case of an advance for purchase of motorcar the Railway servant, before he draws the advance, is required to execute an agreement in the form prescribed separately for initial purchase of conveyance and already purchased conveyance as the case may be, hypothecating the conveyance (motor car) to the President as security for the advance. Failure to execute the mortgage bond in time will render the railway servant to refund forthwith the whole of the amount of advance with interest accrued thereon. (Ref. Sub Para(7) of Para (1108) of IREM) v) It is the responsibility of the sanctioning authority to scrutinize the cash receipts to ensure that the advance has been utilised for the purchase of the conveyance within the prescribed period and that the actual price is not less than the amount of advance. (Ref. Sub Para (8) of Para (1108) of IREM). vi) The sanctioning authority, while scrutinizing the cash receipts, must also ensure that the advance has been utilised for the purchase of the conveyance within the prescribed period, the actual price is not less than the advance and thereafter he should certify the position to the Accounts Officer concerned. (Ref. Sub Para (9) of Para (1108) of IREM). vii) Recovery should commence with the first drawal of pay after the advance is drawn. The authority sanctioning the advance may permit recovery to be made in lesser number of instalments if the railway servant so desires. The amount of interest will be recovered in one or more instalments, with a proviso that such instalment being not appreciably greater than the instalments by which the principal was recovered. The recovery of interest will commence from the month following that in which the whole of principal has been repaid. (Ref. Sub Para (10) of Para (1108) of IREM). viii) Attention is also drawn to note 6(b) and (c) of sub-para 1132(17) of IREM Vol.I (Revised Edition –1989) regarding recovery of HBA. It provides that recovery of advance shall be effected from the mon

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