Hyderabad: The Andhra Pradesh government on Monday requested banks that they should ensure that transactions related to the finances of the state government and funds and institutions adhere to the AP Reorganisation Act.
The government categorically said, “Banks, according to statute, have to act as per the instructions of the officers of the body corporates, who are authorised to issue instructions. They are not expected to take cognisance of instructions from anybody other than the person authorised to transact business with the bank”. This came after the Telangana State’s instructions not to honour Andhra Pradesh government cheques.
The AP government assured the banks that action taken by them in response to the instructions given by the officers authorised by the entity will be supported in full measure by it.
The government said that the contents of the TS government’s circular are not consistent with either the facts or the standard operating procedures for the conduct of business.
It further stated that several assertions made in the circular are not consistent with the provisions of the Act and that the provisions of the Act are binding on the governments of AP and TS and bankers cannot get involved in any issue that may arise between the two states.
The AP government added that the directions of the TS government that bankers should go through the Act and interpret those provisions and act accordingly, is far fetched.
It needs no reiteration that all transactions relating to public finances must be conducted in accordance with standard banking procedures and cannot be subjected to the unilateral directives of the TS government, AP government said.
In its letter, AP said, it is highlighted for the information of the bankers, that every financial transaction of the AP government and its institutions has been and will continue to be in accordance with relevant rules and regulations.
All actions of the state and its entities are and will continue to be governed by the provisions of the Act, wherever applicable. The AP government has requested all bankers to ensure that transactions relating to the finances of the AP government and its funds and institutions included in Schedules VII, IX and X of the Act are adhered to.
It said the banks may contact the AP finance department if they needed any clarifications.
