From To K, Baskaran, LA.S., The District Collectors, Director of Rural Development All Districts and Panchayat Raj, Panagal Building, Saidapet, Chennai-15. Sir/Madam, Sub: Ref: [Link] 94910 /2017/PRI 2-2, dated: 30.11.2017. Rural Development and Panchayat Raj Department - Grants Released to Village Panchayats Account No.2- Utilisation of surplus funds -Transfer of funds to Village Panchayat Account No. 1 and Execution of works- instructions issued - Regarding 1. G.O. No 146, RD and [Link] (C4) Department dated: 17.08.2007. 2. G.O. No 180, RD and [Link] (PRI.1) Department dated: 1.12.2008. 3. DRD, [Link] 39919/2013/PRI 3-2 dated: 10.1.2014 4. Reports received from the Districts on the availability of surplus amount in Account No.2 of Village Panchayats. I invite your kind attention to the references cited. Many representations have been received from various quarters, to create basic amenities in Village Panchayats by using surplus funds available in Village Panchayat Account No. 2. In this regard, the Assistant Directors (Panchayats) have been requested to furnish the Village Panchayat wise availability of surplus amount in the Village Panchayat Account No.2. Accordingly, the Assistant Directors (Panchayats) have furnished the Village Panchayat wise availability of surplus amount in the Village Panchayat Account No.2 after keeping a reserve amount for the next 6 months to pay for current consumption charges and water supply chargesIt has been decided to give permission to utilize the surplus funds for provisions/ improvement of infrastructure facilities in rural areas by the Village Panchayats. Since the Village Panchayats are not permitted to operate the Account No.2 except for the purpose of settlement of dues to TANGEDCO and the TWAD Board as per reference 1* cited, the Village Panchayats should initially remit the accumulated surplus amount to the existing account in Assistant Director (Panchayats) office operated by the District Collector for this purpose. The surplus amount transferred to the Account in Assistant Director (Panchayat) office shall be utilized as per the following conditions. 1, The District Collector may sanction development works from out of the surplus fund in the respective Village Panchayat and may also direct the Village Panchayat to settle any amount required for ongoing Government priority schemes such as AMMA Gym, replacement of street lights LED lights...ete. 2. The Village Panchayat should select the list of works from out of the Village Panchayat Development Plan (VPDP) and submit to BDO (VP). 3. All works which are eligible for sanction as per G.O (Ms) No. 107 RD & Pt. Raj Dept dated: 21.09.2017 can be taken up from this surplus fund. 4. Before sanctioning the above mentioned works, the District Collector shall earmark and release upto Rs. 3.00 lakh to the Village Panchayat Account No.1 based on the availability of surplus fund in that Village panchayat. The Village Panchayat shall utilize the amount to remit library cess in proportion to the House tax collected, measures to control vector borne diseases and other Government dues as first charge. The balance amount can be utilized by the Village Panchayat as per the guidelines issued for usage of Village Panchayat Account No.1. 5. The Block Engineer / Overseer should prepare detailed proposal with actual estimates for the works proposed and the same should be sent to Assistant Director (Panchayats) for administrative sanction. The Assistant Executive Engineers should check atleast 15% of the estimates in his/her jurisdiction.6. The District Collector shall submit the list of proposed works to DRD&PR for scrutiny. DRD&PR may undertake random verification of these works to ensure that these works are taken as per this guideline. 7. The District Collector will accord administrative sanction for the works after the scrutiny of DRD&PR. 8. The works should be executed as per Tamil Nadu Transparency in Tender Act, 1998 and the Rules 2000. 9. Proper documentation should be done before, during and after the execution of the work and should be kept ready for verification. [Link] Block Development Officer (Village Panchayats) should furnish the Progress report for the works sanctioned to Assistant Director (Panchayats) for the release of funds. After verification, the Assistant Director (Panchayats) shall get orders of the District Collector and shall release the funds to the Village Panchayat Account No. 1 of the concerned village Panchayat for settlement of bills. [Link] Village Panchayat should maintain separate cash book for utilizing this surplus amount. [Link] entire surplus amount received from each Village Panchayat should be spent only in that Village Panchayat and shall not be diverted to other Village Panchayats. The Assistant Director (Panchayats) shall be the NODAL officer responsible for proper implementation of the works. He shall monitor the receipt of amount from Panchayats, proposals from the BDOs, administrative sanction and implementation of works, fund release and expenditure. The District Collectors are requested to send the consolidated report of the works executed every month to DRD &PR. I request you to take necessary action on the above points and send action Director taken report at the earliest. Copy to: AD (Pts), All Districts