Chapter IX FINANCE, ACCOUNTS, AUDIT AND REPORTS OF COUNCILS

In this Chapter, unless the context otherwise requires, the word “Council” means the City Council or, as the case may be, the District Council.

1. (1) The Council shall have its own fund and all receipts of the Council shall be carried thereto and all payments by the Council shall be made therefrom.
2. (2) The Council may accept grants, subventions, donations and gifts from the Central or the State Government or a local authority or any individual or body, whether incorporated or not, for the purposes of this Act.
3. (3) The Council may spend such sums as it thinks fit for the performance of its functions under this Act and such sums shall be treated as expenditure payable out of the fund of the Council .
4. (4) All moneys belonging to the fund of the Council shall be kept in any corresponding new Bank specified in column 2 of the First Schedule to the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970 and in column 2 of the First Schedule to the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1980 and approved by the State Government for the purpose or invested in securities authorised by the Trusts Act, 1882 at the discretion of the Council.

The Council may, with the previous approval of the State Government, borrow money from the open market or otherwise for the purpose of carrying out its functions under this Act.

(1)

1. (a) The Council shall, by such date in each year as may be prescribed by rules, submit to the State Government for approval a budget in the prescribed form for the next financial year, showing the estimated receipts and expenditure, and the sums which would be required from the State Government during that financial year.
2. (b) If any sum granted by the State Government remains wholly or partly unspent in any financial year, the unspent sum may be carried forward to the next financial year and taken into account in determining the sum to be provided by the State Government for that year.

1. (2) No sum shall be expended by or on behalf of the Council unless the expenditure is covered by provision in the budget approved by the State Government.

1. (1) The accounts of the Council shall be prepared and maintained in such form and in such manner as may be prescribed by rules.
2. (2) The Council shall cause to be prepared for such financial year an annual statement of accounts in such form as may be prescribed by rules.
3. (3) The accounts of the Council shall be audited by an Auditor duly qualified to act as an Auditor of companies under section 226 of the Companies Act, 1956.
4. (4) The Auditor shall be appointed by the Council.
5. (5) Every Auditor appointed to audit the accounts of the Council under this Act shall have a right to demand the production of books of accounts, connected vouchers and other documents and papers, to inspect the offices of the Council and to require such information from the Council as he may think necessary for performance of his duty as an auditor.
6. (6) The Auditor shall send a copy of his report together with the copy of audited accounts to the Council which shall, as soon as may be after the receipt of the audit report, forward the same to the State Government.
7. (7) The State Government shall, as soon as may be, after the receipt of the audit report under sub-section (6), cause the same to be laid before the State Legislature.

1. (1) The Council shall, during each financial year prepare, in such form and at such time as may be prescribed by rules, an annual report giving a true and full account of its activities during the previous financial year and an account of activities likely to be undertaken by it in the current financial year and copies of such report shall be forwarded to the State Government.
2. (2) The State Government shall cause every such report to be laid before the State Legislature within a period of six months from the date of its receipt under sub-section (1).