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Chapter 4: Budget Estimates, Expenditure, Budget Control

and Completion Reports

Section 1: Introduction - Budget Terms

4.1.1 Budget Estimates: Every Railway Administration has to prepare estimates of
expenditure expected to be incurred by it in a year and submit them on
prescribed dates well in advance of the beginning of that year to the Railway
Board for obtaining the sanction of the Parliament or the President. Such
estimates are called "Budget Estimates".

4.1.2 Demand for Grants: On the basis of the Budget Estimates received from the
various Railway Administrations and other spending units, the Railway Board
prepare their "Demand for Grants" and present them to the Parliament or the
President, as the case may be, for sanction.

4.1.3 Grants and Appropriations: The 'Demands for Grants' as finally approved by
the Parliament are called the Budget 'Grants' and those sanctioned by the
President without reference to the Parliament are called 'Appropriations'.

4.1.4 Budget Orders and Allotments

(a) Railway Grants and Appropriations for a year are distributed by the Railway
Board to the various Railway Administrations and other spending units directly
under the Railway Board, through what are known as 'Budget Orders'. The
Budget Orders are accompanied by the Budget Documents.

(b) Grants and Appropriations distributed to the various Divisions and spending
units are called Budget Allotments.

4.1.5 Budget Documents: The complete Budget is printed in the form of books as
under:

(a) Demands for Grants.

(b) Explanatory Memorandum showing the financial results of the year.

(c) Works, Machinery and Rolling Stock Programme of Railways.

4.1.6 Re-appropriation: The transfer of funds originally assigned for expenditure on
a specific object to supplement the funds sanctioned for another object is called
"Re-appropriation". The powers of the Railway Board and Railway Administration
in respect of re-appropriation are detailed in Chapter III of the Indian Railway
Financial Code Volume I (extracts at Annexure: 4-A1).

4.1.7 Review of Expenditure: The sufficiency or otherwise of the sanctioned budget
allotments shall be reviewed periodically by each Railway Administration on the
basis of expenditure actually incurred upto the time of review and the anticipated
expenditure during the remaining portion of the financial year. The detailed
procedure in regard to review of Expenditure is contained in Chapter III of the
Indian Railway Financial Code, Volume I (extracts at Annexure: 4-A2).

Chapter 4: Budget Estimates, Expenditure, Budget Control and Completion Reports Page 59 of 535