87. General account of port.—All moneys received by or on behalf of a Board under the provisions
of this Act, and all moneys received by it as the Conservator of the port and of the port approaches or as
the body appointed under sub-section (1) of section 36 of the Indian Ports Act 2
*** shall be credited to a
fund called the general account of the port.
88. Application of moneys in general account.—(1) The moneys credited to the general account
under section 87, shall, subject to the provisions of section 89 of this Act and of section 36 of the Indian
Ports Act, be applied by the Board in payment of the following charges, namely:—
(a) the interest and instalments of principal due in respect of any loan that may have been raised
or obtained by the Board or for the repayment of which the Board may be liable, and payments to the
sinking fund established for such loan;
(b) the salaries, fees, allowances, pensions, gratuities, compassionate allowances or other moneys
due to—
(i) the Chairman, Deputy Chairman and other Trustees;
(ii) the employees of the Board; and
(iii) the surviving relatives, if any of such employees;
(c) the contributions, if any, payable to the Central Government or any State Government on
account of the pension and leave allowance of any officer lent to the Board by such Government;
1. Subs. by Act 17 of 1982, s. 14, for “such amount not exceeding ten lakhs of rupees, as the Central Government may fix in this
behalf” (w.e.f. 31-5-1982).
2. The words, brackets, figure and letter “excluding all fees and all fines and penalties creditable to the pilotage account of the
port under sub-section (5a) of that section” omitted by Act 23 of 1992, s. 8 (w.e.f. 23-1-1994).
35
(d) the cost and expenses, if any, incurred by the Board in the conduct and administration of any
provident or welfare fund or loan or special fund established by the Board;
(e) the contributions, if any, duly authorised to be made by regulations made under this Act to any
such fund as is referred to in clause (d);
(f) any charges for which the Board may be liable under section 108 or section 109;
1
[(g) such sums as may, from time to time, be agreed upon by the Board and a State Government
or the Central Government or any other authority, as a reasonable contribution payable by the Board
towards the expenses in connection with the watch and ward functions of the police force or the
Central Industrial Security Force or any other force which the State Government or the Central
Government or the other authority, as the case may be, may establish and maintain for the protection
of the port and the docks, warehouses and other property of the Board;]
(h) the cost of repairs and maintenance of the property belonging to or vested in the Board and all
charges upon the same and all working expenses;
(i) the cost of the execution and provision of any new work or appliance specified in section 35
which the Board may determine to charge to revenue;
(j) any expenditure incurred under section 36;
(k) any other expenditure which may be incurred by the Board generally for the purposes of this
Act;
(l) any other charge which may on the application of the Board 2
[or otherwise] be specially
sanctioned by the Central Government or for which the Board may be legally liable.
(2) 3
[Subject to such general or special directions as the Central Government may, for the purpose of
maintenance or development of major ports in the country or generally for the development of shipping
and navigation, give in this behalf, all moneys standing at the credit of the Board] which cannot
immediately be applied in the manner or for the purposes specified in sub-section (1) shall—
(a) be deposited in the State Bank of India or in such 4
[corresponding new bank or banks], and
subject to such conditions as may, from time to time, be specified by the Central Government; or
(b) be invested in public securities or in such other securities as the Central Government may
approve in this behalf; and the said securities shall be held in trust by the Board for the purposes of
this Act;
5
[or].
6
[(c) be given as a loan to the Board of another port for the development of that port.
7
[(d) be invested, in any manner, in an arrangement referred to in sub-section (3A) of section 42;
(e) be invested, in any manner, in the development or management of any port including a port
other than a major port on such terms and conditions as may be approved by the Central
Government.]
Explanation.—For the purposes of this sub-section, “corresponding new bank” means a
corresponding new bank as defined in the Banking Companies (Acquisition and Transfer of
Undertakings) Act, 1970 (5 of 1970) or the Banking Companies (Acquisition and Transfer of
Undertakings) Act, 1980 (40 of 1980).]
6
[(3) Every direction issued by the Central Government under sub-section (2) shall be complied with
by the Board and shall not be called in question in any court on any ground.
1. Subs. by Act 29 of 1974, s. 30, for clause (g) (w.e.f. 1-2-1975).
2. Ins. by s. 30, ibid. (w.e.f. 1-2-1975).
3. Subs. by Act 12 of 1988, s. 2, for “All moneys standing at the credit of the Board” (w.e.f. 28-1-1988).
4. Subs. by s. 2, ibid., for “scheduled bank or banks” (w.e.f. 28-1-1988).
5. Added by s. 2, ibid. (w.e.f. 28-1-1988).
6. Ins. by s. 2, ibid. (w.e.f. 28-1-1988).
7. Ins by Act 22 of 2000, s. 3 (w.e.f. 1-9-2000).
36
(4) No suit or other legal proceeding shall lie against the Central Government, the Board or any
officer or other employee of the Board authorised by it in this behalf for any loss or damage caused or
likely to be caused by anything which is in good faith done or intended to be done in pursuance of any
direction issued under sub-section (2).]
89. [Power to transfer moneys from general account to pilotage account and vice versa.] Omitted by
Act, 1992 (23 of 1992), s. 8 (w.e.f. 23-1-1994).
90. Establishment of reserve funds.—(1) A Board may, from time to time, set apart such sums out
of its surplus income as it thinks fit, as a reserve fund or funds for the purpose of expanding existing
facilities or creating new facilities at the port or for the purpose of providing against any temporary
decrease of revenue or increase of expenditure from transient causes or for purposes of replacement or for
meeting expenditure arising from loss or damage from fire, cyclones, shipwreck or other accident or for
any other emergency arising in the ordinary conduct of its work under this Act:
Provided that the sums set apart annually in respect of, and the aggregate at any time of, any such
reserve fund or funds shall not exceed such amounts as may, from time to time, be fixed in that behalf by
the Central Government.
(2) Any such reserve fund or funds may be invested in public securities or in such other securities as
the Central Government may approve in this behalf.
91. Power to reserve Port Trust securities for Board’s own investments.—(1) For the purposes of
any investment which a Board is authorised to make by this Act, it shall be lawful for every Board to
reserve and set apart any securities to be issued by it on account of any loan to which the consent of the
Central Government has been given, provided that the intention to so reserve and set apart such securities
has been notified as a condition to the issue of the loan.
(2) The issue by any Board of any such securities direct to and in the name of the Board shall not
operate to extinguish or cancel such securities, but every security so issued shall be valid in all respects as
if issued to, and in the name of, any other person.
(3) The purchase by a Board, or the transfer, assignment or indorsement to a Board or to the Trustees
of the sinking fund set up by a Board, of any security issued by the Board, shall not operate to extinguish
or cancel any such security but the same shall be valid and negotiable in the same manner and to the same
extent as if held by, or transferred or assigned or indorsed to, any other person.
92. Prior sanction of Central Government to charge expenditure to capital.—(1) No expenditure
shall be charged by a Board to capital without the previous sanction of the Central Government:
Provided that a Board may without such sanction charge to capital expenditure not exceeding such
limit as may be specified, and subject to such conditions as may be imposed, by the Central Government.
(2) Nothing in sub-section (1) shall be deemed to require the further sanction of the Central
Government in any case where the actual expenditure incurred as a charge to capital exceeds the
expenditure sanctioned in this behalf by the Central Government unless the excess is more than ten
per cent. of the expenditure so sanctioned.
93. Works requiring sanction of Board or Central Government.—(1) No new work or appliance,
the estimated cost of which exceeds such amount as may be fixed by the Central Government in this
behalf, shall be commenced or provided by a Board, nor shall any contract be entered into by a Board in
respect of any such new work or appliance until a plan of and estimate for, such work or appliance has
been submittted to, and approved by, the Board; and, in case the estimated cost of any such new work or
appliance exceeds such amount as may, from time to time, be fixed by the Central Government in this
behalf, the sanction of the Central Government to the plan and estimate shall be obtained before such
work is commenced or appliance provided.
(2) Nothing in sub-section (1) shall be deemed to require the further sanction of the Central
Government in any case where the actual expenditure incurred does not exceed by more than ten per cent.
the estimated cost so sanctioned.
37
94. Powers of Chairman as to execution of works.—Notwithstanding anything contained in section
93, the Chairman may direct the execution of any work the cost of which does not exceed such maximum
limit as may be fixed by the Central Government in this behalf, and may enter into contracts for the
execution of such works but in every such case the Chairman shall, as soon as possible, make a report to
the Board of any such directions given or contracts entered into by him.
95. Power of Board to compound or compromise claims.—Every Board may compound or
compromise any claim or demand or any action or suit instituted by or against it for such sum of money
or other compensation as it deems sufficient:
Provided that no settlement shall be made under this section without the previous sanction of the
Central Government if such settlement involves the payment by the Board of a sum exceeding such
amount as may be specified by the Central Government in this behalf.
96. Writing off of losses.—(1) Subject to such conditions as may be specified by the Central
Government, where a Board is of opinion that any amount due to or any loss, whether of money or of
property, incurred by, the Board is irrecoverable, the Board may, with the previous approval of the
Central Government, sanction the writing off finally of the said amount or loss:
1
[Provided that no such approval of the Central Government shall be necessary where such
irrecoverable amount or loss does not exceed, in any individual case and in the aggregate in any year,
such amounts as the Central Government may, from time to time, by order, fix and different amounts may
be fixed with respect to different Boards.]
(2) Notwithstanding anything contained in sub-section (1), where the Chairman is of opinion that any
amount due to, or any loss, whether of money or of property, incurred by the Board is irrecoverable, the
Chairman may sanction the writing off finally of such amount or loss provided that 2
[such amount or loss
does not exceed, in any individual case and in the aggregate in any year, such amounts as the Central
Government may, from time to time, by order, fix and different amounts may be fixed with respect to
different Boards.]
3
[(3) In every case in which the Chairman sanctions the writting off of any amount or loss under
sub-section (2), he shall make a report to the Board giving reasons for such sanction.]
97. Powers, etc., of Board as Conservator or body appointed under section 36 of Indian Ports
Act.—All the powers, authorities and restrictions contained in this Act in respect of the works by this Act
authorised, shall apply to the works which may be executed by the Board as the Conservator of the port or
as the body appointed under sub-section (1) of section 36 of the Indian Ports Act 4
*** and also to the
sanction of such works, the estimates therefor, and the expenditure thereunder.
98. Budget estimates.—(1) A Board shall, on or before the thirty-first day of January in each year,
hold a special meeting at which the Chairman of the Board shall submit an estimate of the income and
expenditure of the Board for the next financial year, in such form as the Central Government may specify.
(2) A copy of such estimates shall be sent by post or otherwise to each Trustee so as to reach him not
less than ten clear days prior to the date appointed for the special meeting referred to in sub-section (1).
(3) The Board shall consider the estimate at such meeting and may provisionally approve of it with or
without modifications.
(4) The Board shall, on or before the tenth day of February, cause a copy of such estimate as
provisionally approved by it, to be sent to the Central Government.
(5) The Central Government may sanction the estimate or may return it with remarks and may call for
such additional information as it may deem necessary.
1. Subs. by Act 17 of 1982, s. 15, for the proviso (w.e.f. 31-5-1982).
2. Subs. by s. 15, ibid., for certain words (w.e.f. 31-5-1982).
3. Ins. by s. 15, ibid. (w.e.f. 31-5-1982).
4. The words, brackets, figure and letter “, not being works the cost of which is chargeable to th pilotage account of the port
under sub-section (5b) of that section” omitted by Act 23 of 1992, s. 8 (w.e.f. 23-1-1994).
38
(6) When an estimate is returned under sub-section (5), the Board shall proceed to reconsider the
estimate with reference to such remarks and shall furnish such additional information as the Central
Government may call for and shall, if necessary, modify or alter the estimate and resubmit it to the
Central Government.
(7) The Central Government shall sanction the estimate with or without modifications.
(8) Where any such estimate is not sanctioned by the Central Government before the commencement
of the financial year to which it relates, the Central Government may authorise the Board to incur such
expenditure as may be necessary in the opinion of the Central Government until such time as the approval
of the estimate by the Central Government is communicated to the Board.
99. Preparation of supplemental estimate.—A Board may in the course of any year for which an
estimate has been sanctioned by the Central Government cause one or more supplemental estimates for
the residue of such year to be prepared, and the provisions of section 98 shall, so far as may be, apply to
such estimate as if it were an original annual estimate.
100. Re-appropriation of amounts in estimate.—Subject to any directions which the Central
Government may give in this behalf, any sum of money or part thereof of which the expenditure has been
authorised in an estimate for the time being in force sanctioned by the Central Government and which has
not been so spent, may at any time be re-appropriated by the Board to meet any excess in any other
expenditure authorised in the said estimate:
Provided that no such reappropriation shall be made from one major head of expenditure to another
such head without the previous sanction of the Central Government.
101. Adherence to estimate except in emergency.—(1) Subject to the provisions of section 100,
no sum exceeding such amount as the Central Government may fix in this behalf shall, save in cases of
pressing emergency, be expended by, or on behalf of, any Board unless such sum is included in some
estimate of the Board at the time in force which has been finally sanctioned by the Central Government.
(2) If any sum exceeding such limit as may have been fixed in this behalf under sub-section (1) is so
expended by any Board on a pressing emergency, the circumstances shall be forthwith reported by the
Chairman to the Central Government, together with an explanation of the way in which it is proposed by
the Board to cover such extra expenditure.
102. Accounts and audit.—(1) A Board shall maintain proper accounts and other relevant records
and prepare the annual statement of accounts, including the balance-sheet in such form as may be
specified by the Central Government in consultation with the Comptroller and Auditor-General of India.
1
[(2) The accounts of the Board shall be audited—
(i) once in every year; and
(ii) if so required by the Comptroller and Auditor-General of India, concurrently with the
compilation of such accounts,
by the Comptroller and Auditor-General of India or such other persons as may be appointed by him in
this behalf and any amount payable to him by the Board in respect of such audit shall be debitable to the
general account of the Board.]
(3) The Comptroller and Auditor-General of India or any person appointed by him in connection with
the audit of the accounts of a Board shall have the same rights, privileges and authority in connection with
such audit as the Comptroller and Auditor-General of India has in connection with the audit of
Government accounts and, in particular, shall have the right to demand the production of books of
accounts, connected vouchers and other documents of the Board.
103. Publication of audit report.—(1) Within fourteen days after the audit and examination of the
accounts of a Board have been completed, the Comptroller and Auditor-General of India shall forward
copies of the audit report to the Central Government and to the Board.
1. Subs. by Act 29 of 1974, s. 31, for sub-section (2) (w.e.f. 1-2-1975).
39
(2) The Central Government shall cause every audit report to be laid for not less than thirty days
before each House of Parliament as soon as may be after such report is received by that Government.
104. Board to remedy defects and irregularities pointed out in audit report.—Every Board shall
forthwith take into consideration any defects or irregularities that may be pointed out by the Comptroller
and Auditor-General of India in the audit report on the income and expenditure of the Board and shall
take such action thereon as the Board may think fit and shall also send a report of the action so taken to
the Central Government.
105. Central Government to decide difference between Board and auditors.—If there is a
difference of opinion between any Board and the Comptroller and Auditor-General of India on any point
included in the audit report, and the Board is unable to accept and implement the recommendations, if
any, made by him on such point, the matter shall forthwith be referred to the Central Government which
shall pass final orders thereon and the Board shall be bound to give effect to such orders.