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State of Rajasthan - Section

Section 443 in Rajasthan Insolvency Rules

443. Special provisions for maintenance of accounts of Insolvents estates.

- The following special provisions shall be followed in respect of the maintenance of insolvents estates by official receivers.-General
(1)Figures in the accounts shall be in English characters. Books of accounts shall be substantially bound and paged before being brought into use.
(2)Corrections and alterations shall be neatly made in red ink and initialed and dated by the official Receiver. Erasures and over-writings shall on no account be permitted in registers, statements, vouchers or account of any description.Receipt and Crediting of money
(3)All moneys received by the official Receiver in his official capacity on behalf of any insolvent estate under his management shall, without any reservation, be promptly accounted for in the general cash book to be maintained in form of Register No. 78. When money is received in cash, a receipt in Form No. 51 shall be prepared and signed by the official Receiver or such other person as the court may direct. While authorising any such person to collect income the court may decide whether any security and if so for what amount, should be furnished by him.
(4)When income of zamindari property is collected through the collecting agent, he shall keep a progressive total on the counterfoils of receipts referred to in clause (iii) of sub-rule (12), and remit in tact all such collections to the official Receiver as such intervals as may be fixed by the court.
(5)The official receiver shall deposit all money received by him in the State Bank of India or in a Post office Savings Bank in the name of the court, keeping in his hands only such cash as is sanctioned by the court. An account may be opened in some other bank also with the previous approval of the Government. In places where there is no branch of the State Bank of India or any other suitable bank approved by the Government, the insolvency funds shall be deposited in the Treasury in a separate Personal Ledger Account as "Official Receiver’s Account" to be administered by the District Judge or by such other Presiding Officer as may be authorised by the District Judge in this behalf. He shall open a single current account in the bank in his official capacity for moneys belonging to all the insolvent estates under his management, if there is a large balance at the Credit of any particular estate, such portion thereof as is not likely to be required in the near future may be transferred from the general account to the fixed deposit account or Savings Bank Account in the name of the estate concerned, and the interest accruing on such deposits shall be credited to the ledger account of that estate.
(6)The cash in the hands of the Official Receiver shall not exceed the amount fixed by the Court to meet emergent petty expenses.
(7)The cash book shall be closed, balanced and signed by the Official Receiver at the end of each month and the balance compared with that of the bank pass book and the fixed deposit receipts: the differences, if any, being explained in a footnote in the cash book. The cash book shall be laid before the insolvency court once a quarter alongwith the quarterly statement referred to in sub-rule (8) for scrutiny and signature.Personal Ledger.
(8)A separate ledger account in the prescribed from (Reg. 79) shall be maintained by the Official Receiver for each estate in his management.Items of receipt and expenditure shall be carried to these ledgers from the cash book, as soon as the transaction occurs. At the end of each quarter, the entries of the ledger shall be totalled and then the larger shall be put up before the court for inspection.A statement (Ret. 31) shall be prepared at the end of the each quarter.Note. - The grand total of the balances of all the estates shall be made to agree with the balance shown in the cash book at the end of the quarter concerned and a certificate to that effect endorsed by the Official Receiver on the statement.Record of Movable and Immovable Property
(9)As soon as the Official Receiver takes charge of an insolvents’ property, he shall prepare an inventory thereof, and submit it for the information of the court.
(10)The details of the property of the insolvent, shall be entered from the inventory referred to in the preceding rule, in the register of movable and immovable property described in sub- rules (11) and (12).
(11)A register of movable property shall be maintained in the prescribed from (Reg. 80) in which separate pages shall be allotted for the entries relating to each estate. When the property or a portion of it is disposed of by sale or otherwise, columns 6 to 8 of the register shall be posted. If the sale proceeds are immediately realized, they shall be brought to account directly in the cash book. If they are to be realized subsequently or by installments, the demand shall be entered in the register of Miscellaneous Demands in the prescribed from (Reg 81), and a reference to the entry in the demand register shall be quoted in the remarks column of the property register against the entry concerned.
(12)A register of immovable property shall be maintained in the prescribed from (Reg. 82) and the instructions regarding the maintenance of the register of movable property contained in the preceding sub-rule shall as far as possible be observed in the maintenance of this register as well. When houses and shops belonging to an estate are given out on rent, or Zamindari property is leased out, the realization of the demand shall be watched through the Register of Miscellaneous Demands (Reg. 81), a reference being made in the remarks column of the Register of Immovable Property against the entry concerned. When Zamindari property is under direct management, the collecting agent shall be required to keep the following records:-
(i)A copy of the Patwari’s Khatauni.
(ii)A Bahi-khata in the prescribed from (Reg. 33) in which all demands on account of account of current and arrear rents, sayar and manorial dues, etc., shall be recorded.
(iii)A receipt book in Form No. 52 which shall bear printed book and serial number.
(iv)A statement (Ret. 57) of demand, collection and balances, etc. estate-wise and giving also grand totals, to be prepared from the bahi-khata at the close of the revenue year. The statement shall be put before the court for its information and necessary orders as soon as it is ready.
(13)If property is sold by auction, a list of bidders shall be drawn up showing the following particulars: the last bid being initialled by the sale officer as well as the purchaser:-
(i)Date of auction.
(ii)Particular of Property sold showing its number or quantity.
(iii)Reference to property register.
(iv)Names of bidders.
(v)Amount of each bid.
(14)In the case of auction held by recognized firms of auctioneers, the list mentioned above may be dispensed with but a sale accounts should be obtained from the auctioneer and kept on record. It may also be dispensed with under the special orders of the Insolvency Judge when the property sold is movable and consists of petty items.Register of Book Debts.
(15)The Official Receiver on taking over charge of an estate shall prepare a list of book debts and other money assets, such as decrees bonds mortgage deeds, Government and other securities, etc. the list shall be submitted to the Court for information and copied in the Register of Book Debts in the prescribed from (Reg. 84). Each class of assets shall be entered separately in this register, a reference to the inventory or other document being made against the entry concerned in the column of remarks. If a book debt or a portion thereof is remitted by the court, the order shall be quoted in the column of remarks. Decrees for money and /or costs obtained by the Official Receiver subsequently for or on behalf of the estate of the insolvent shall be entered in this register as well as in the Register of Miscellaneous Demands (Reg. 81).Register of Dividends
(16)All debts due by an estate shall be recorded in the register in the prescribed form (Reg 85) as soon as they are admitted, when dividends are distributed, the entries of their payment shall be made in columns 6 to 8. Sufficient space should be allotted for the account of each creditor to admit of the entries of dividends paid on different occasions being made at the same place.Payments
(17)Each payment made from the funds of an insolvent estate shall be supported by a payment voucher which shall bear an order of payment from the Official Receiver. Small sums shall be paid from the case in hand of the Official Receiver, while large payments on account of dividends and other items shall be made by cheque which should, as far as possible, be in the name of the actual payee.
(18)The payment vouchers shall be serially numbered for each month and kept in a guard file along with actual payee’s receipts. In case of petty items in which payee’s receipts cannot be conveniently obtained, the court may furnish a disbursement certificate which shall be attached to the voucher concerned. The Official Receiver, however, may give a disbursement certificate for petty items up to a rupee.Register of suits
(19)With a view to watch the progress of expenditure on the suits instituted or defended by the Official Receiver on behalf of an estate, a register of suits in the prescribed from (Reg. 86) shall be maintained, expenditure being posted immediately as it occurs.Audit
(20)The accounts kept by the Official Receiver shall be audited annually by the Examiner, Local Fund Accounts, except when the income of the estate is below Rs. 20/- per annum.Before the accounts of an estate are finally closed, a reasonable amount should be reserved for the cost of audit which shall have preference over the remuneration of the Official Receiver.
(21)The audit fees to be charged to the estate shall be at the following rates:-
Particulars of estates Rates of audit fee per estate
Rs. nP.
1. Estates with income of Rs. 20/- but below Rs. 100/- perannum 2 0
2. Estates with income of Rs. 100/- to Rs. 300/- per annum 5 0
3. Estates with income of Rs. 301/- to Rs.500/- per annum 7 0
4. Estates with income of Rs. 501/- to Rs.750/- per annum 10 0
5. Estates with income of Rs. 751/- to Rs. 1000/- per annum 12 50
6. Estates with income of above Rs. 1000/- per annum Rs. 1/25 percent on the total income of theestate.
Such fees shall be credited in the Treasury when payable to the Examiner, Local Fund Accounts, by triplicate challan.N.B. - Income means whatever amount is received from the estate of the Insolvent either by its transfer or in the share of periodic yield e.g. Zamindari profits, rent, interest on deposits, realizations from decrees or undecreed debt, dividends, etc.
(22)The Official Receiver shall at the time of audit, cause to be produced all accounts, registers, documents and subsidiary papers, which may be required by the audit officers, to assist them in their investigation.
(23)The objection statements issued by the auditor in the course of audit, shall be returned to him promptly and in any case before the close of audit, with notes showing the action which has been taken or which it is proposed to take to settle the objections raised over the signature of the Official Receiver. The auditor shall return for further action any items on which final or sufficient action has not, in his opinion, been taken and when possible, shall, before leaving the station, bring to the personal notice of the court, items which have not been disposed of.
(24)The result of each audit shall be communicated to the court in two parts viz., (i) the objection statement, containing outstanding objections dealing with technical irregularities, omissions and defects and (ii) the audit note dealing with matters of a general and important nature, which require the particular attention of the court or higher authority.
(25)The court shall consider the audit note and the objection statement as soon as possible after their receipt, and decide the action to be taken in regard thereto. The action taken shall be indicated on an interleaved copy or on the margin of the audit note and on the objection statement which shall be placed before the audit officers at their next visit.Proof of Debts