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State of Madhya Pradesh - Section

Section 49 in The M.P. Zila Panchayats (Accounts) Rules, 1999

49. Security Deposits from Employees.

(1)The cashier or store keeper or any other employee of the Zila Panchayat who is entrusted with the custody of cash or store shall furnish security of a minimum amount of Rs. 10,000/- or such higher amount as may be fixed by the Zila Panchayat.
(2)Modes of Security. - Security to be taken from an employee should be in one of the following modes subject to the conditions noted against each, or partly in one and partly in another of these modes when this is specially permitted by the officer authorised to accept the security :-
  Form Conditions
  (1) (2)
(a) Cash Zila Panchayat will not pay any interest on the depositedamount.
(b) Post Office fixed deposit Certificates, National SavingsCertificates. The certificates should be formally transferred in favour ofthe Chief Executive Officer with the sanction of the Head PostMaster, and should be accepted at their surrender value at thetime of tender.
(c) Deposit receipts of Schedule Banks/Co-operative Banks. (1) The deposit receipt should be made in the name of thepledged or, if it is made out in the name of the pledger, thebank should certify on it that the deposit can be withdrawn onlyon the demand or with the sanction of the pledgee.
    (2) The bank should agree that on receiving a withdrawalorder from the pledgee in receipt of the deposit, or any partthereof, it will pay the deposited amount with interest to thepledgee.
    (3) The depositor should in writing undertake any riskinvolved in the investment.
    (4) The responsibility of the pledgee in connection with thedeposit and the interest on it will cease when he issues a finalwithdrawal order to the depositor and sent the information tothe bank that he has done so.
(d) Fidelity bonds from Insurance Companies. A fidelity bond may be accepted as Security Insurance fromthe servant of the Panchayat but not from a Private party. Thebond should be in the prescribed form.
(e) Third Party guarantee. The Guarantor should not be related to the person on whosebehalf the guarantee is being given. The guarantee should alsobe accompanied with a solvency certificate for an amount notless than 4 times of the required amount of security.
Conditions. - (1) When an employee has furnished security in the form of a fidelity bond, the Chief Executive Officer receiving the bond should see that the employee pays the premia necessary to keep it alive on the due dates and continue to do so until a period of six months has elapsed since he vacated his office.
(2)A security deposit taken from an employee should be retained for at least six months from the date when he vacates his post, but security should be retained permanently or until it is certain that there is no further necessary for keeping it.
(3)Without a special order of the Chief Executive Officer no security should be repaid or retransferred to the depositor, or otherwise disposed off, except in accordance with the terms of security bond or an agreement.
(4)The Chief Executive Officer on returning any security to the depositor should invariably obtain his acknowledgment duly signed and witnessed. When an interest bearing security is refunded or re-transferred, the acknowledgment should set forth full particulars.
(5)All securities including fidelity bonds and security bonds should be kept in the safe custody of the Chief Executive Officer or such other person as may be authorised by him.
(6)The question whether a particular mode of security tendered is or is not satisfactory from the point of view of its acceptance or otherwise if for Chief Executive Officer to decide at his discretion after examining all the aspects of the case.