Telecommunication Accounts and Finance -12

 
Chapter-12  Powers of PSUs / Delegation Methods
 
Delegation
Most of us complain at the end of the day that in spite of our best efforts and intentions, we find no time to pursue important activities. The urgent always takes the priority. Resultantly, important activities wait till we find more time. In the emerging global scenario, the executive time should be invested in important work. Executives are expected to discharge a high level of responsibility. Their time should be released to pursue innovative and creative functions. Their time should be released for policy matters and creative problem solving activities and pursuing action plans for the future. It is also necessary that as demanded by the emerging competing environment, everyone working in the corporation should pursue value based activities with prior defined goals and objectives. If the above were to become a reality, there should be more and more delegation of work across the organization. The absence of delegation could have been tolerated in the past, but it will prove detrimental for the organization for its growth in the future.
 
General conditions governing exercise of delegated powers:
1. The schedule of delegation of powers is subject to conditions that all the administrative and financial powers shall be exercised strictly in accordance with the approved budget, business plans, investment plans, annual HR plans and policies of the company, rules and directives of the Central Government/Administrative Ministry etc.2. These financial powers will be exercised strictly in consultation with IFA of the respective Circles/SSAs .
 
3. The powers sub delegated to subordinate officers will also be exercised with the concurrence of an appropriate level of Accounts &Finance officer decided by the Circle IFA.
4 It should be ensured that the expenditure on all occasions will be limited to the budget allocation and cash drawal limit fixed by the corporate HQ.
 
Powers of BSNL Board: The general powers of BSNL as a Govt. Company vest with the Board of Directors. These will be laid within the frame work and provisions of Companies act and periodical directives/instructions issued by Govt. (Department of Telecom.) BSNL has so far communicated the delegation of powers defining the limits up to which CGMs/GMs can exercise the powers. In matters falling beyond the powers delegated, The BSNL board will convey such orders with the approval of "Competent Authority" in the BSNL BOARD.
 
The following matters are generally reserved for the Board's approval.
 
(1) Annual programme of production, construction, sales and the corporate plan of the company.
(2) Estimates of capital expenditure as well as operational expenditure and revenue of the company.
(3) Organizational set up and setting up of standards to create new posts and remunerations structure of its employees including policy matters such as payment of bonus etc.
(4) Rules governing service conditions of employees such as pensionary benefits, medical rules traveling allowance rules etc.
(5) Entering into contracts above a certain value of higher magnitude.
(6) Policy relating to pricing of telecom. tariffs etc. and other policy matters in technology implementation.
Some important decisions on delegation of financial powers and other related matters:
Delegation and Re-Delegation of Financial Powers: No authority may delegate any part of the powers conferred upon it to any authority subordinate to it or to any other  authority without the previous consent of the Finance Ministry. In delegating such powers it may provide for the re-delegation of the delegated powers by the authority concerned, with the previous consent of the Finance ministry to any officer subordinate to such authority. Unless otherwise provided by any general or special rule or order, it shall be within the competence of an authority to exercise the financial powers delegated to another authority subordinate to it.
 
Maximum Financial Powers:
(i)             The delegation indicated is the maximum power an authority can exerciseand is inclusive of the powers delegated to subordinate authorities. In otherwords, after the lower authority has exercised his power in respect of anyoffice, the higher authority can exercise further power only to the extent ofhis power less the powers of the lower authority already exercise.
(ii)           However, in case the sanction to expenditure on purchase and repair offurniture is issued by a higher authority because the amount of expenditureon that particular occasion exceeded the power of sanction of the lowerauthority in respect of one office, the lower authority can still continue tosanction expenditure upto the limit of its own power of sanction, providedthat the total expenditure in that year in respect of that office does not gobeyond the limits of power of sanction per office per annum of the higherauthority who at one stage sanctioned expenditure for that office subject tothe further proviso that the sanction of the higher authority should clearlyspecify the extent if any to which the normal powers of the subordinateauthority to incur expenditure would remain unaffected.
(iii)          It should also be ensured that the expenditure incurred on any one occasionis not split up for bringing it within the power of sanction of any authority.(DG P&T No. 18-24/59-C I dated 10.12.1959)
 
Register to Watch Annual and Other Limits:
In the case where power to sanction an expenditure is delegated to an authority with the restriction that the total amount of sanction accorded during the year any other period should not exceed a certain limit, such authority should in order to watch that the prescribed maximum limit is not exceeded, keep a re4cord of all sanctions accorded by him for each such class of expenditure. The manuscript form in which such register is to be maintained is given below:
 

Sl. No. of the entry	No. and date of sanction	Name of the office incurring the expenditure with brief particulars of the charge	Amount of each sanction	Progressive total up to and including each entry of a new sanction	remark

 
(Rule 348 of P&T F.H.B.Volume I)
 
Heads of Circles and executives who are delegated with financial powers to incur expenditure should consult their IFAs on all matters falling with in the field of their delegated powers.IFAs should also be consulted on proposals having financial implications which are referred to higher authorities for approval or orders and this fact should be indicated specifically in the letters.
 
CGM may over rule the advice of IFA. Where the advice of the IFA is overruled, it should be done by a written order, recording reasons for doing so and intimated to corporate office.(Member (Fin) letter No. 16-64/69- B dated 25/27-2-70)
 
Where ever the decision has to be taken by the Head of office say either CGM/GM/DGM etc, the file should be marked to him through his IFA. IFA is always declared one level below the officer exercising the financial power.
 
Where the advice of the IFA is over ruled, it should be done by a written order recording reasons.
(Member (Fin) letter No. 16-64/69- B dated 25/27-2-70)
The files falling within the delegated financial powers of an authority should be routed through the concerned IFA i.e. if the case falls with in the financial powers delegated to a Head of the Circle, the case should be route through Circle IFA and if the case falls with in the delegated financial powers of a GM heading an SSA it should be routed through his IFA working in the SSA.
(D.G.P&T No. 16-39/71-B dated 29.06.71 & 30.07.71)
All sanctions issued in exercise of the delegated powers after consultation with the IFA should have the following subscript:
‘”This sanction issues after consultation with the Internal Financial Advisor”
(D.G.P&T No. 3-1/75 FC dated 24.02.75/01.03.75)
 
Domestic Arrangement:
The gazetted officers attached to an office do not function independently but conveys a domestic arrangement, the sanction/orders of the a Head of the office in accordance with such local instructions as may be issued by the Head of the office to regulate working of his office. The level up to which each officer may decide cases and convey sanctions/orders of the head of the office is a matter entirely left to the discretion of the head of the office.(Based on instructions contained in D.G.P&T lr.No. 43/17/57-PE/CI dated 04.01.58)Any such domestic arrangement should be made in consultation with the IFA by a local order indicating the various officers who will exercise powers in the name and on behalf of the head of the office and the extent of power to be exercised by each. Thereafter such cases need not be referred by the officers to IFA while exercising these powers, except in cases of doubt or difficulty.(Member (Fin) lr.No. 16-64/69-B dated 30.04.70)   
 
The Head of the office shall continue to be responsible for the correctness, regularity and propriety of the decisions taken by the subordinate officers authorized to exercise the powers in the name and on behalf of the Head of the office.
 
For this purpose, there should be once in three months an in-depth review by the Head of the office in consultation with his IFA to ensure that the power is exercised with due regard to propriety and that they are not being abused. If necessary, the orders regarding authorization of subordinate officers to exercise powers in the name of the Head of the office can be revised.
(D.G. P&T No. 18-7/66-CI/4995/FA II/73 dated 10.12.1973)
 
Recurring Expenditure: Recurring expenditure means the expenditure which is incurred at periodical intervals.
In respect of recurring contingent expenditure, per annum in each case means each type of expenditure. For example: If a subordinate authority is empowered to incur expenditure on repairs up to Rs.10,000/- per annum in each case, it would be competent for it to incur expenditure on repairs on any number of occasions during the year but subject to a limit of Rs.10,000/- for that year.
 
Non-Recurring Expenditure: Means expenditure other than recurring expenditure. In respect of non-recurring contingent expenditure ‘each case’ means ‘on each occasion’. If on a particular occasion, a number of articles of furniture are to be purchased, the powers of the sanctioning authority should be reckoned with reference to the total value of articles of furniture to be purchased on that occasion, and not with reference to individual articles like tables, chairs, racks etc. constituting the furniture. Thus a subordinate authority empowered to incur expenditure on the purchase of furniture to the extent of Rs.25000/- in each case would be competent to purchase various articles of furniture not exceeding Rs.25000/- in value on each occasion.(Authority: Explanation (2) below Schedule V of delegation of financial powers Rules, 1958.)
 
Opening of Tenders: Tenders for procurement of stores (and other articles) should be opened by an officer other than the one dealing with the procurement.
 
(D.G.P&T No. 4-2/75-MMD/Pt dated 30.01.1982)
 
Exercise of Financial Powers by an Officer Appointed to Perform Current Duties
of another Post in Addition to His Own Duties without Extra Remuneration:
An officer appointed to perform the current duties of a post in addition to his own can exercise the administrative or financial powers vested in the full fledged incumbent ofthe post but he cannot exercise statutory powers, whether these powers are derived direct from an act of parliament (E.G Income Tax Act) or rules, regulations and Byelaws made under various articles of the constitution (FRs, CCS(CCA) Rules CSRs and delegation of financial Rules, etc. )(GOI MHA F.7/14/61_Estt(A) dated 24.01.63.)
 
Guidelines from BSNL HQ with regard to exercise of financial powers delegated under various heads
 

Item no.	Description Of Item	Purpose intended
2.00	Sanction of new Schemes / Projects	As a corporate entity loss making projects are generally not to be executed. However based on the Govt. directives such projects are to be taken up to the extent of coverage provided by the financial package made available to the corporation for the purpose. This requires exercising control over the loss making projects, which are to be implemented out of the financial support from the Government.
2.1.4	Sanction of new Schemes / Projects : Repetitive Projects	The financial powers delegated under this head are to sanction more projects to expand telecom. Network.
2.3.1	Land	Financial powers under this head are to aim at expediting building construction activities.
2.3.2	New Building	To expedite construction of buildings for early installation of sys/equipment
2.3.3	Additions & alterations to existing departmental buildings	To speed up installation activities.
2.3.5	Dismantlement of the buildings	To speed up constructional  activities.
2.3.6	Repairs/additions to rented buildings both civil and electrical items	To improve the working conditions of staff.
2.3.7	Purchase of old buildings	To expedite installation of equipment/systems.
2.3.8	Purchase of new buildings/floors	To improve amenities to staff.
3.4	Hiring of vehicles	To ensure easy mobility of staff/officers for better maintenance.
4.0	Purchase of stores	To procure materials quickly to speed up constructional and maintenance activities.
4.5	Purchases without quotation and with quotation. Purchase of Computers: for improved office automation.	For speedier procurement of materials for day to day requirement.
4.7	Purchase of furniture &Furnishings	To improve working environment of staff.
5.1	Contingent expenditure -Recurring	For meeting regular petty expenses.
5.2	Contingent expenditure – nonrecurring	For periodical expenses.
5.3	Advertisement & Marketing	For improving customer care & Marketing.
5.8	Guarding of other telecom installations round the clock by armed guards	For ensuring safety of telecom. Installation.
5.10	House keeping	For improving image of the company.
6.1	Renting of buildings – Administrative offices	For providing good working environment to staff.
6.5	Renting of buildings –office cum residence	For providing better accommodation to staff.
6.6	Enhancement of rent for buildings	For providing better accommodation to staff.
7.1	Payment of advances and securities for purchase of stores	For expediting early supply of materials.
7.2	Payment of advances and securities for execution of work by other local/public agencies	For expediting constructional activities.
9.1	Payment of Honorarium	To motivate staff for better performance.
9.2	Rewards/Awards	To elicit suggestions for improvement of telecom. Service
9.3	Payment of productivity linked incentive	To increase productivity.
10.3.1	Compensation for death/injury	To settle cases of compensation quickly.
11.0	Writing off losses	To settle cases early/expeditiously.
12.3	Scrapping of obsolete stores/equipments	To reduce inventory of useless stores.
13.2	Grant of donations/grant to Co-operative Stores	To improve staff welfare
13.4	Sponsorship of sports events	To promote company’s image.
17.0	Acceptance of tenders and award of works	To speed up implementation of works for achieving targets.
17.3	Acceptance of single tender in case of limited tender	For expediting urgent works.
18.3	Supply of meals for staff  Detained in office in case of emergencies	For staff welfare.
18.4	Gifts to visiting dignitaries	For improving the image of the company.
18.5	Waival of excess SOA	To provide better accommodation to staff
18.6	Payment of reinstatement charges to highways corporation, Municipalities, Panchayats etc.	To expedite constructional activities to achieve targets.
18.7	Insurance of movable and immovable items	To ensure safety of departmental property and prevent loss.

 
The list of Sr.DDGs/DDGs from technical side as per nominations circulated in BSNL C.O.No. 6-13/2000-EB dated 12.03.2001 is as follows:
 

SL	Telecom Circle /Metro District /Mtce. Regions	Nominee Of BSNL Board	Nominee From Finance Side
1	Andaman & Nicobar Islands	DDG(REGULATION	DDG (Accounts)
2	Andhra Pradesh	DDG(PERSONNEL)	Sr. DDG(IA &P)

 
 

1 Andaman & Nicobar Islands       DDG(REGULATION)                DDG (Accounts)

2 Andhra Pradesh                               DDG(PERSONNEL)                 Sr. DDG(IA &P)

3 Assam              DDG(MKTG)             DDG(IBF)

4 Bihar                        DDG(MM-I)                 DDG(IBF)

5 Chhattisgarh                         SR.DDG(PG)                         Sr. DDG(TRF)

6 Gujarat                           DDG(NS)                          Sr. DDG(IA &P)

7 Haryana                               DDG(RN)                            Sr. DDG (EFC)

8 Himachal Pradesh                       DDG(MKTG )                 Sr. DDG(IA &P)

9 J&K                              DDG(IT)                       Sr. DDG (EFC)

10 Jharkhand                   DDG(MM-I)                   DDG(IBF)

11 Kerala                             DDG(SR)                        DDG (BLF)

12 Karnataka                    DDG(IT)                      Sr. DDG (EFC)

13 Madhya Pradesh                SR.DDG(PG)               Sr. DDG(TRF)

14 Maharashtra                      SR.DDG(SW)                  Sr. DDG(TRF)

15 N.E.I                         DDG(NM)                 DDG(IBF)

16 N.E.II                             DDG(NM)                   DDG(IBF)

17 Orissa                         DDG(CMTS)                  DDG(IBF)

18 Punjab                     DDG(TRG)                   Sr. DDG (EFC)

19 Rajasthan                           DDG(TRG)                DDG(PF)

20 Tamilnadu                        DDG(NM)                       DDG (BLF)

21 U.P. East                            SR.DDG(NW&WS)               DDG(PF)

22 U.P. West                 SR.DDG(CS)                  DDG(PF)

23 Uttaranchal             SR.DDG(SR)                 DDG(PF)

24 West Bengal                   DDG(MM-II)                    DDG (Accounts)

25 Calcutta                          SR.DDG(MS)                        DDG (Accounts)

26 Madras                              SR.DDG(CS)                             DDG (BLF)

27 WTR                        DDG(NS)

28 ETR                             SR.DDG(TX)

29 NTR                            DDG(ADMN)

30 STR                                         DDG(CMTS) DDG (BLF)

31 Northern Maintenance Region                  Sr. DDG(IA &P)
32 Western Maintenance Region                   Sr. DDG(TRF)
33 Eastern Maintenance region                     DDG (Accounts)
 
The nomination of members from Finance was circulated vide BSNL HQ No. 11- 64/99-FC dated 27.02.2001.
It has been declared in the above mentioned letters of BSNL HQ that the said orders will be applicable retrospectively from 1.10.2000 and that the Circle telecom. Board will continue and exercise the same financial powers as being exercised prior to 1.10.2000 in erstwhile DOT/DTS/DTO.
 
DELEGATION OF FINANCIAL POWERS TO THE IFAS
 

Item SL	Item	Extent Of Power
1	Working lunch/dinner for meeting /conference with Auditors (as well as staff detained in connection with the audit job)	Rs.100/- per head on each occasion.
2	Light refreshment for meeting/conference with Auditors( as well as staff detained in connection with the audit job)	Rs.50/- per head on each occasion.
3	Hiring of vehicle for the use of branch Auditors	Full
4	Provision of Stationery and other items associated with audit	Full powers. For this purpose IFAs will have an imprest account of Rs.5000/- which will be utilized by an officer authorized under them withapproval of expenditure given by IFAs.

 
 
IFAs of SSAs: The IFAs of SSAs will also exercise the powers indicated at 1 and 2 above for the audit parties and staff detained subject to a ceiling of Rs.30,000/- per audit cycle.
(BSNL No. 600-6/2000-TA-II/BSNL dated 28.11.2001.)
 
Important instructions from BSNL HQ to be borne in mind while exercising financial powers in respect of some items of delegation:
 
1.2 Sub delegation: These powers can be delegated subject to the condition that he is wholly responsible for all the powers exercised by his subordinates/Head of SSA as if CGM has himself exercised these powers. These powers shall be delegated in consultation with IFA and there shall be an annual ceiling on the expenditure to be incurred by the subordinate officers.
BSNL HQ No. 6-22/2002-EB(Pt) dated 19.05.2003.)
 
Item No. 1.9 Obtaining of ISO Certification:
(i)             CGMs would be required to process for ISO certification for their units in phased manner considering the importance of the units which require ISO certification, especially for meeting the operational performance parameters as well as TRAI performance parameters. CGMs should also ensure that proper financial appraisals are carried out for every case of ISO certification.
(ii)            (ii) ISO certification is required to be taken for BSNL services/quality management system, with the aim of boosting the image and business of the organization in international marketing by virtue of potential efficiency &quality of service.
(iii)          (iii) ISO certification should be taken up with Bureau of Indian Standards(BIS) or other authorized ISO certifying agencies.
(iv)           (iv) ISO certification procedure requires documentation by declaration and acceptance of quality policy of the organization through development of qMS quality Management &Systems by lying down of procedures, maintenance & control of document and records by ISO authorities. QMS mainly emphasis on customer focus, leadership, involvement of continual improvement, in view of constant quality surveillance & parameters by ISO authorities, consignment on certification, there has to be improvement ofwork culture so as to maintain the quality to avoid rejection of services in the market.
(v)            (v) However documentation charges may not have to be incurred since all the officers of BSNL have been/are being trained in ALTTC on preparation of documents.
 
(BSNL HQ NO.6-26/2002-EB dated 1.4.2004)
 
 
Item No. 2.1.4 Repetitive Projects: The exercise of the powers is subject to the following conditions:
 
(i)             Decision on each project proposal shall be taken with the concurrence of Circle IFA.
(ii)           (ii) Project proposals shall be examined with due reference to the analysis of relevant factors including quantification of the anticipated benefits and validity.
(iii)          (iii) This is not applicable in respect of Cellular Mobile Net work for which approval has been given separately to the continuance of the authorization earlier made by CMTS wing.
(iv)          (iv) Once the investment proposal for tendering /procurement of any item/project is approved by the Board, circles will not be required to obtain further approval.
(v)           (v) All the procurements in accordance with the approved plans and projects will be carried out in accordance with the procurement manual of the company.
(vi)          (vi) The exercise of the powers is further subject to approved Annual Investment plan etc. and other general instructions.
(BSNL HQ NO. 6-5/2004-EB dated 7.3.2005.)
 
 
 
Item No. 4.2. Purchase of stores: Items which were earlier in centralized list and now decentralized will be procured by CGMs. For other items, which were being procured by CGMs earlier to revision of power vide letter No. 6-15/2000-EB dated4.10.2001, their powers remain with them and also in respect of such items power for delegation down below will also remain with CGMs as deemed necessary by CGMs.(BSNL HQ No. 6-15/2000-EB dated 28.02.02)
 
Item No. 7.7 Advance Payment for purchase of vehicle: The exercise of power under this head is subject to the following conditions:
 
(i)             Whenever the DGS&D by implications of THEIR instructions havepermitted BSNL to place orders for the items included in their R/R contractas a post-deposit party, no advance payment should be allowed.
(ii)            (ii) In those cases wherever the items to be procured are not in the DGS&D rate contract and the item is approved for purchase by BSNL Corporate office, then 100% advance payment can be allowed to the manufacturer of the said vehicle directly and not to -any of their dealers. The Proforma invoice so obtained from the manufacturer should not have a lead time of more than one month for delivery of the vehicle to the consignee. In case of default in delivery schedule exceeding one month then the usual interest applicable insuch cases for holding the money have to be charged on them.
(iii)          (iii) Powers should be exercised by the head of the Circles personally with the concurrence of the Circle IFA and not to be re-delegated to lower formations.
 
Item No.16. Professional services: the word ‘Professional service’ is clarified as under
(i) As far as entry services are concerned, this may be covered under sub Head 16.1  “New items of Computerisation “CGM as he thinks fit, may further delegate the powers to the heads of SSAs headed by GMs or TDMs in consultation with the IFA of a Circle in respect of the above item.
(ii) As regards to accountants' consultant, this is a contingency item and may be booked accordingly.