A SUMMER INTERNSHIP PROJECT

ON

A STUDY REPORT ON WORKING PROCESS OF PAY AUDIT AND

LABOUR SECTION

AT

AMMUNITION FACTORY,KHADKI,PUNE

SUBMITTED TO

SAVITRIBAI PHULE PUNE UNIVERSITY

IN PARTIAL FULFILLMENT OF

MASTER OF BUSINESS ADMINISTRATION

SUBMITTED BY

SHIVAM SANJAY PAITHANKAR

UNDER THE GUIDANCE OF

CA.RITU DANGE

ALL INDIA SHRI SHIVAJI MEMORIAL SOCIETY’S

INSTITUTE OF MANAGEMENT

2020-21

I
 DECLARATION

I, the undersigned, hereby declare that the project report entitled “A STUDY
REPORT ON WORKING PROCESS OF PAY AUDIT AND LABOUR
SECTION ” written and submitted by me to the Savitribai Phule Pune
University, in partial fulfillment of the requirement for the award of degree of
Master of Business Administration under the guidance of  CA.RITU DANGE
is my original work and the conclusions drawn here in are based on the material
collected by myself.

Date:                                         SHIVAM SANJAY PAITHANKAR

Place: Pune

II
 ACKNOWLEDGEMENT

First of all I would like to take this opportunity to thank the AISSMS IOM or having project
as a part of the MBA Curriculum.

I would like to take this opportunity to express my sincere gratitude to Dr. Abhijeet
Mancharkar for providing me a helpful environment in the complexity this project and for
giving me the fine opportunity to do this project in the esteemed organization.

I gratefully acknowledge to CA. RITU DANGE  who has given me the opportunity to learn
at a deep level to prepare this report and supported me throughout this project with most
cooperation and patience

I am grateful to my mentor Mr. SUHEL SIDDI JT.GM (JOINT.GENERAL MANAGER)

at Ammunition Factory, Khadki his guidance, encouragement, and suggestions proved very
helpful to me in completing my internship as well as the internship report.

III
CERTIFICATE

IV
 CONTENTS
SR . NO PARTICULARS PAGE NO
1 EXECUTIVE SUMMARY 7

2 INTRODUCTION

3 Organizational Profile
4 Outline Of Task Assigned
5 Relevant Activity
6 Learning From The Project
7 Contribution To The Organization
8 Bibliography

V
AMMUNITION FACTORY,KHADKI,PUNE

VI
Executive Summary

This is project report was made from the internship period of two moths

AFK is the largest manufacturer of Ammunition like 5.56mm and 9mm this factory also
produces many other Small Arms Ammunition, Mortar Bombs, Detonators, Fuzes, Power
Cartridges, Igniters, Squibs, and Sporting Ammunitionin India.AFK, constantly driven by
“aiming higher” has come a long way from its humble beginnings in 1869 and is the
preferred choice for most of the renowned names in the defense industry.A part of the OFB
Kolkata, a billion-dollar conglomerate with a significant presence in the defense industry
draws upon the industrial heritage of the factories as it grows from strength to strength.

This project is an attempt to understand the overall process of pay audit.A project which will
make me well versed with daily analysis of pay audit.This project aims to study the various
components of pay Audit.While doing the project I learned how to maintain the daily
payments of employees and wages of the workers.The project takes us through the overall
process of pay audit and Labour section.In the ammunition factory work related to Leave
Travel Concession (LTC), MEDICAL,PAYMENTS OF EMPLOYEES AND LABOUR,
PAY FIXATION,PENSIONS Etc

1
INTRODUCTION

2
Introduction:

Typically, auditors normally use five types of audit procedures to obtain audit evidence.
Those five audit procedures include Analytical review, inquiry, observation, inspection,
and Recalculation.A pay audit is a process that lets you verify employees’ wages/salaries
and identify any pay disparities. Pay audits are vital to achieving pay equity, ensuring
employees are paid equally for performing the same or similar work.

A payroll audit verifies that your business is paying employees accurately, timely, and in
compliance with the law.Payroll audits are two-pronged. The first step is making sure your
payroll records are accurate, timely, and complete. After making any corrections to any errors
uncovered in the first part, it’s time to identify faults in procedures called internal controls
that have led or could lead to inaccuracies.

Thisis the process that is followed in the corporate world but there is a difference in the
working process of private and government work. the pay structure which is followed in
private firms are not similar as followed by government firms there are different
processes/structures of payment, salary in government which is as follows:

Pay audit section consist of audit and payments of bills like medical, ta/da,LTC,CEA,LTC
advance,leave encashment, Cgegis, pay fixation, pensions.If any employee of the factory
claims because of the time consuming process he/she has to wait for many days to get the
benefit of the claim.
Claims made by Employee the operations shown as performed are correct and pricing of
these operations are at correct rates. Pay audits are one tool to identify and monitor unequal
pay in the workplace, but they’re not the only step to reconciling for or prevent uncontrolled
pay gaps. Just like a fever is a sign of a deeper illness, we must look at pay inequities as a
symptom not a cause of other disparities in the employee lifecycle.

3
COMPANY

PROFILE

4
Company Profile:

Organizational Background:

Ammunition Factory Khadki situated near the bank of the Mula River is a premier

factory manufacturing ammunition. The main product of the factory is 5.56mm INSAS

Ammunition developed by

DRDO and productions at AFK in the year 1993.

Besides 5.56mm this factory also produces many other Small Arms

Ammunition, Mortar Bombs, Detonators, Fuzes, Power Cartridges, Igniters,

Squibs and Sporting Ammunition. (Based on the production estimates of 125

MRD of 5.56mm & 40 MRD of 9mm Ammunitions the core activities of AFK

have been planned.) The factory has planned investment for its modernisation

with the induction of State of the Art modern, multi-operational, high speed

machinery for better productivity and consistent quality.

The HRD plan aims at a lean and thin organization with a concentration on core

activities. It also emphasizes on up-gradation of human resources by

continuous training and upgrading the skills for multiskilling activities.

Core activities of the organization are producing and supplying arms, ammunition, armoured

vehicles, ordnance stores,etc.

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HISTORYAND DEVELOPMENT:

Ammunition Factory Khadki came into being on 16th December 1869 asa Small Arms
manufacturing unit of the British Government. Regularproduction of ammunition cartridges
using gun powder for Sniders Rifleand Henry Martini Rifle commenced in 1872.

In 1886, the manufacture of Cartg 0.303" magazine rifle was establishedusing cordite
(made from nitrocellulose and nitroglycerine paste) propellant.

In 1914 there was an expansion of manufacturing facilities atAmmunition Factory Khadki

& different types of primary explosives likemercury fulminate, lead azide, lead
styphnate and filling of caps,detonators, percussion fuzes & different pyrotechnic stores
were introduced ammunition Factory Khadki for meeting the requirements of war in Asia
& Africa.

PRODUCTS:

Ammunition Factory Khadki has a wide range of product matrix which

has been changing from time to time to cater to the requirement of

armed forces. Though originally planned for manufacture for small arms, AFK

subsequently AFK created a facility for the manufacture of medium caliber

and well. However, with time the

Pune city expanded in length & the breadth and the Factory which was

located far from civilian population came in the center of the population

and this affected safety distance regulations and consequently a large

number of high caliber & medium caliber ammunition was shifted to

other sister factories. The product matrix of Ammunition Factory KhadkiOFB (Ordnance

Factory Board) the organization was set up in the year 1979 with its headquarters in Kolkata.
AtApex level, headed by Chairman and DGOF.

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All Factories are divided into Five operating divisions and headed by Addl DGOF/

Member. Those are:

Materials & Components (8 Factories)

Weapons, Vehicles & Equipment (10 Factories)

Ammunition & Explosives (11 Factories)

Armoured Vehicle Group (7 Factories)

Ordnance Equipment Group (5 Factories)

In addition to the above, Members are headed other Divisions viz. Personnel, Technical

Services,

Export and Finance. Except for Member Finance, all others are from the IOFS cadre.
Member

Finance is from the IDAS cadre on deputation. Ammunition Factory Khadki is under
A&E

Division. It is situated near the bank of the Mula River and was established in the year 1869
by

British Govt. It is a premier Small Arms Ammunition manufacturing factory.

MAIN PRODUCTS:

Cart 5.56mm

Cart 9mm

51 mm HE Mortar Bomb

81 mm HE Mortar Bomb

Anti Submarine Rockets

Kavach Chaff Rockets

40 m UBGL Ammunition

7
 1) Cart 5.56mm 2) Cart 9mm

3) 51 mm HE Mortar Bomb 4) 81 mm HE Mortar Bomb

(5) Kavach Chaff Rockets

8
TECHNOLOGY

Cart 5.56 m fully automated manufacturing and packing units

 Automatic filling of Detonator plan

 Latest CNC machines

 CAD System which utilizes UNIGRAPHICS NX3 Software components, jigs,

fixtures and press tools in solid modeling mode.

 Automatic online gauging system

CUSTOMERS:

 ARMY

 AIRFORCE NAVY

 MHA (State and Central Police, BSF CRPF, etc)

 CIVIL TRADE

 DRDOs

AWARDS/CERTIFICATES :

ISO 9001 certified

ISO 14001 certified

Golden Peacock for HR excellency for the year 2019

R& D Centre:

 Ordnance Development Centre (ODC) in AFK

 Design Centre with CAD/CAM facilities

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SUPPLY CHAIN, PRODUCTION, AND ISSUES :

Customers place a demand/Indent on OFB against their requirements, OFB gives Targets to

Concerned Factories by placing Extracts. The extract is the authority for undertaking
procurementaction at Unit Factory Level.

The planning section of Factory gives Annual Targets to Material Control Office (MCO).

MCO prepares Material Planning Sheet (MP sheet) taking stock and dues of the items and

sent to LAO for Vetting Checking. LAO, after vetting returns the MP Sheet to Material

Management (MM) section for initiating procurement action.

MM sections either place an IFD (Inter Factory Demand) on sister Ordnance Factories or
issue

Tender for Trade procurement through bidding. A Supply Order will be placed on a
successful

bidder. Every item is coded as LF (Ledger Folio) number with detailed

technicalspecifications.

When a material is received in the factory, IGP (inward Gate Pass) is prepared by the
Security

section at the time of entering the material. Based on IGP Store Section prepares MIS
(Material

Inward Slip) and forward to the Quality Material Inspection section.  After inspection
material

is accepted and MIS is sent to the Stores section. Store section prepares Receipt Voucher and
the

material is taken into Stock and entered into Bin Card.

After receiving Annual Targets from OFB, the Planning section issues Warrants to
Concerned

Production sections for manufacture Warrants include Work Order specifying user Codes

10
Warrant consists of both Material and Labour parts. Warrants are based on Standard
estimateswhich are prepared by time and motion study. So, sections can draw material as
authorized inthe Material Warrants and engage Labour as authorized in the Manufacturing
Warrant.

The products manufactured are tested as per the specified requirements. The accepted

products are issued to the customers against Inspection notes and issue vouchers. Rejected

items are disposed of as per the standard procedure.

OFB AFK being a Govt. Organization entire money transactions are carried in book

adjustments under respective code heads.

FUNCTIONS

Functions of Kirkee Group of Factories.

Payments

payment of pay & allowances, personal claims, GPF maintenance, and payments to

suppliers.

Finance

vetting the provisioning and procurement proposals, participations in TPCs, vetting of

supply orders/contracts and post-contracts amendments and issues

Accounting

compilation of financial and cost accounts including an accounting of all expenditure,

bookingof issues to indentors, inventory accounting, pricing of estimates, production review

through the quarterly financial reports (QFR) and cost analysis.

Budgeting

participation in budget formulation from the shop level to OFB level, pricing of products,

monitoring through periodical review of expenditure and issues.

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ORGANISATIONAL HIERARCHY :

GM (GENERAL
MANAGER)

AGM (ADDITIONAL
GENERRAL MANAGER

JT.GM( JOINT GENERAL

MANAGER)

DGM (DEPUTY GENERAL

MANAGER )

WM (WORKS MANAGER)

AWM (ASSISTANT WORKS

MANAGER)

SUPERVISOR

WORKERS

12
Outline of task assigned :

1) To know the overall working process of pay audit and labour section
2) I have been recruited as an intern for two months at ammunition factory and they have
given me the opportunity to know the overall process of the pay audit and labour
section.
3) I collected the data of various schemes like LTC,TA/DA,CEA,MEDICAL,PENSION
AND the advances of all Bills
4) I have also seen one of the schemes overall procedure i`e. LTC if one of the
employees claims LTC how much time it will take to complete the process and what
are the documents that he/she have to submit for the claim to get all the benefit.
5) During the internship period I got a chance to interact with the seniors of the factory
and they gave me so much guidance and information about the factory and the work.
6) All the information given below is related to the benefits of employees and the
workers of the factory.

13
Objective:

i) To understand the pay audit process of the ammunition factory.

ii) To know the medical facilities provided by the ammunition factory.
iii) To evaluate the factory`s current financial position and whetherthe factory is
making a profit or loss.
iv) To study the process of LTC,MEDICAL,CEA,SALARY,TA/DA followed by the
factory
v) To show the Overall Observations Of IE`s Earnings,Expenditure & Net Payables

14
RELEVANT ACTIVITY

15
Sections Studied Under Controller of Finance and Accounts

Department :1) PAY AUDIT

2) TPC

3) LABOUR SECTION

4) MATERIAL SECTION

5) COSTING SECTION
6) FUNDING SECTION

CLASSIFICATION OF WORKERS :
Employees in ordnance factories that are directly employed for production and
maintenance jobs are called industrial workers and are classified :
1) Semi-skilled
2) Skilled
3) Highly skilled-grade II
4) Highly skilled-grade I
5) Master craftsman
Classification of IE`s :

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 INDUSTRIAL EMPLOYEES (IE`S)

Piece worker
 Individual piece workers Day worker
 Gang piece workers

Calculation of Wages of IE`s

Day workers : Payment of day workers according to of wages Act, 1936 is as follows :

Those who are paid on the basis of attendance are called day workers.

The formula for gang piece workers’ wages :

= 1 x Basic monthly pay (Band pay + Grade pay)

N-S
Gang piece workers :

Workers on piece work rates of wages, working individually or in gangs are called individual
workers.

N: No of days in a month

S: No of Sundays in a month

H: No of closed paid holidays in a month

PAY AUDIT :

17
Pay audit section consist of audit and payments of bills like MEDICAL,
TA/DA,LTC,CEA,LTC ADVANCE,LEAVE ENCASHMENT,CGEGIS,PAY
FIXATION,PENSIONS

R-SECTION ACCOUNT OFFICE

PAY AUDIT SECTION Entry in Entry/ Exit Register

CONCERNED TASK HOLDERS

1) Audit and Pass

2) Note in Register

3) Note in Service book

4) Prepare cheque slip for each bill

SO (A)/ AAO

1) Check and Pass

2) Check correctness
3) Approved and Submit to Sr. A.o

SR.A.O

Forward to D Section Along with DP sheet for

CMP (Cash Management Process)

Total Work Role Of Pay Audit :

18
Verification of claims made by Employee the operations shown as performed is correct and
pricing of these operations are at correct rates. Pay audits are one tool to identify and monitor
unequal pay in the workplace, but they’re not the only step to reconcile for or prevent
uncontrolled pay gaps. Just like a fever is a sign of a deeper illness, we must look at pay
inequities as a symptom–not a cause–of other disparities in the employee lifecycle.

Themain objectives of the pay audit section are :

1) LTC advance

2) LTC encashment

3) LTC final bill

4) Medical advance

5) Medical (CGHS)

6) CEA (children education allowance)

7) SCP (special cash package)

Claims which comes under the pay audit section which can be avail by the employee as staff
in the factory are as follows:-

Payments are done by pay audit :

an NIE`S- Nonindustrial employees (LDC/UDC GROUP `B` OFFICERS)

b. NGO's- Non-Gazetted officers (Chargeman, Group 'B' Officers)

c. GO's-Gazetted Officer's (JWM,JWM(SG), Group 'A' Officers) d. Allied establishment

under DGQA (Direct General Of Quality Assurance

d. Allied establishment under DGQA (Direct General Of Quality Assurance

e. CQA (A) Khadki-Controller of Quality Assurance(Armaments)
f. CQA(ME)Khadki -Controller of Quality Assurance (Military Explos
g. SQAE (A) Khadki- senior quality assurance establishment (Armaments)
h. OCRI-Operational Capability Improvement Request

19
i.New recruited employee- provisional payments

Other than the above Payments the Pay Audit also works on the following :
a) Claims of NIES/NGOs etc.
b) Claims for Overtime Allowance and Night Duty Allowance of NIES/NG
c) Registers, Reports, and Returns: Lists of Registers to be maintained to get Leaf
InstructionsandReports and Returns to be rendered by the labour
d) Encashment of Earned Leaves along with Leave Travel Concession while

LTC ADVANCE :
Rules ;

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 1) Up to 90% of the fare can be taken. Advance admissible for both outward return
journeys if the leave taken by the official or the anticipated absence of members
of the family does not exceed 90 days. Otherwise, the advance may be owned for
the outward journey only.
2) The time limit for drawl of LTC advance is 125 days (i.e 4 months and 5 days) in
case of journey by train.
3) In Cases where LTC journey is proposed to be undertaken by other modes Viz,
air/sea/road, the time limit for drawing LTC advance shall remain 65 days only.
4) Advance can be drawn separately for self and family.

Claim :
1)  When an advance is taken, (a) the claim should be submitted within one month
from the date of the return journey. If not, an outstanding advance will be
recovered in one lump sum and the claim will be treated as one where no advance
is sanctioned. Further, penal interest at 2% over GPF interest on the entire
advance from the date of draw to the date of recovery will be charged
2)  When claim is submitted within stipulated time but an unutilized portion of
advance is not refunded, interest is chargeable on that amount from the date of
drawl to the date of recovery
3) When a part of the advance becomes excess drawal due to genuine reasons
beyond the control of the Government servant, the Administrative Authority may,
if satisfied, exempt charging of interest
4) When no advance is taken, the claim should be submitted within three months
from the completion of the return journey. Otherwise, the claim will be forfeited

This Is The Sample Bill Of Advance For Leave Travel Concession (LTC)

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Advance For Leave Travel Concession To Govt. Servant During Regular Leave

To. Bill No: 2021018092

Accounts officer

A.F.K Pune 411003.

Through.

The sr. general manager

A.F.K Pune.

(Signature) permanent no. : 5154099

Basic Pay: 24500-1900

GPF Ac No: 2014207004306

1) Name & Designation:Ashutosh Karan (LDC) Lower Division Clerk

2) Section in which serving EST
3) Amount of advance Required: Rs 3621
4) Encashment Amount Given Rs
(Pay) (Grade Pay) (D.A) Days Encashed
24500 1900 7595 0
For (SELF)
5) Period and Nature of leave 14/02/22 To 02/03/22 (Earned leave) No of days 20
6) F. O No of Date 08/01/22

7) The Proposed date of an outward journey starting 12/02/22

8) Name of home town as declared for the AURANGABAD BIHAR
Purposed journey ( with nearest Railway Station)

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 9) Permanent Home town Address. KARMA ROAD ,SUBHASH
NAGAR,AURANGABAD ,BIHAR
10) Mode And The Class Of Conveyance: T/AC-CHAIR CAR/FIRST/AC III TIER
Indicating mail/express/sleeper class for each ticket
11) Details of amount for each ticket KHADKI to AURANGABAD BIHAR
Fare by mail/express/sleeper
Amount to be reimbursed by the government

For onward journey Rs 2012

For return Journey Rs 2012

Total Rs 4024

12) Amount of advance admissible for 90% of total Rs. 3622

13) Total amount of advance required Rs 3621
14) Data by which payment is required

No LB/24/LTC/
Sanctioned Design /sec. LDC/ESTT

Per No . 514028

GPF A/C No 2021420700430014

(Signature)

DO/ Bills Group

For Sr. General Manager

Leave Travel Concession (LTC) :

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 Leave Travel Concession is a benefit offered to salaried employees
thathelps them travel domestically. The LTC benefits are provided to employees
for two trips in four years block.

Eligibility:
1. Any employee with one year of continuous service is on the date of journey
performed by him/hisfamily is eligible.

2. An official appointed on 31-12-2018 will be eligible for two-year block 2020-

21,but those appointed on or after 1-1-2021, will not be eligible for that block.
3. When both the husband and wife are central govt. Servants:
4.
a) they can declare separate Home towns independently
b) they can claim LTC for their respective families, viz., While husband can
claim for his parents/minor brothers/sisters, the can avail for her
parents/minor brothers/sisters;
c) Either of the parents can claim the concession for the children
5.  The husband/wife who avails LTC as a member of the family of the spouse, cannot
claim independently for SELF.

Meaning of Family for LTC :

(i) The Government servant's wife or husband and two surviving unmarried
children or stepchildren wholly dependent on the Government servant, irrespective
of whether they are residing with the Government servant or not;
(ii) Married daughters divorced, abandoned, or separated from their husbands and
widowed daughters and are residing with the Government servant and wholly
dependent on the Government servant.
(iii) Parents and/or step-parents (stepfather and stepmother) wholly dependent on
the government servant whether residing with the government servant or not.

LTC to Home Town :

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 1)  LTC to Home Town Admissible to all employees irrespective of the distance
involved.
2) Home town once declared is treated as final. In exceptional circumstances, the
Head of the Department may authorize a change, only once during the entire
service
3) Government employees whose headquarters and Home Town are same, not
eligible for Home Town LTC.

LTC to Any Place in India :

1) Government employees whose headquarters and Home Town are same, not
eligible for Home Town LTC. 
2) Officials availing LTC to hometown for self alone once every year are not
3) Officials availing LTC to Home town for self alone once every year are not
entitled to LTC to anywhere in India.

Travel Entitlements :
Pay level in Pay Travel Entitlement
Matrix
By Air By Train By Road
14 and above Business/ club class AC- I The actual fare in
AC Bus

12 and 13 Economy Class AC-I The actual fare in

AC Bus

9 to 11 Economy Class AC-II The actual fare in

AC Bus

6 to 8 Not entitled AC-II The actual fare in

AC Bus

4&5 Not entitled First-class/AC- The actual fare in

III/AC Chair car Public Bus

3 & below Not entitled First-class/AC- The actual fare in

III/AC Chair car Public Bus

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LEAVE TRAVEL CONCESSION:

26
TA/DA :

After completing the journey of the deputation period, the Individual has to claim the expense
he has done through the TADA period. This includes bills of Mode of Transportation, Taxi
Fare, etc.
In the case of any individual, group, or classes of employees, the entitlements particularly in
respect of mode of travel, class of accommodation, etc. shall be checked and verified by the
task holders and give the entitlements accordingly.

Advance Bills:
1. File with the introduction of TADA
2. Movement order

3. Detention certificate

4. Rejoining certificate
5. Declaration certificate

Terms of TADA:
It differs as per the Payscale of an employee as per the following:
Payscale (1-5):- Food charges- Rs. 500 per day Hotel charges- Rs. 450 per day
Daily allowance- Rs.113 per day
Travel mode- 3AC (tier)
Per km charges- Rs.12

Payscale (6-8):- Food charges- Rs. 800 per day

Hotel charges- Rs. 750 per day Per km charges- Rs.24
Daily allowance- Rs.225 per dayTravel mode- 2AC (tier)

Final Bills:
Generation of:
Check slip
Punching medium
DP sheet
CMP sheet

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TRAVELLING ALLOWANCE/DAILYALLOWANCE:

28
Medical Advance :

1) For indoor treatment. 90% Medical Advance of the approved CGHS package rates for
all indoor treatments, irrespective of major or minor diseases, on receipt of a
certificate from the treating Physician of Government/ recognized hospital
2) For outdoor treatment-Advance is limited to 90% of the total estimated expenditure if
the total estimate of expenditure including tests/investigation is more than 10,000.
3) Advance to be released within 10 days of receipt of the request for advance by the
Administrative Department/Ministry/Office.

CGHS (central government health scheme) :

CGHS (Central Government Health Scheme) is the scheme given to the government servants
who are living within an 8kms radius of the Factory. CGHS is not free of cost, A Govt.
servant has to contribute at a specified rate (given below)
on a monthly basis

Sl no. Pay level in matrix pay contribution (per month)

1 Level 1 to 5 Rs 250/-
2 Level 6 Rs 450/-
3 Level 7 to 11 Rs 650/-
4 Level 12 and above Rs 1000/-

• Employee must have the prescription by the authorized doctor for treatment in
Ordnance Factory Hospital(OFH)
• If the employee is living outside 8kms of the factory then he is eligible for the CSMA.
• Authorized medical attendant refers to as per CGHS/CSMA hospital
• CGHS applies for the employees whose: - Basic Pay Lesser than or equal to 47600rs.
He will get 90% of the package rate in advance.
• If employees Basic pay is greater than 47601rs. =100% of the package rate in
advance.

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 • Employees will also get if Admitted, Accommodation charges (For Basic pay upto=
47600rs) =1000rs. per day
• Employees will also get if admitted, accommodation charges (for basic pay more than
= 47601 Rs) = 2000 per day
• For both grade pay consultation fees 2 times per day- 270rs per day

OPD:

Authorized Medical Attendant (AMA) charges 70 Rs. (10 days - Acute disease)
MBBS doctor charges of recognized hospital consultancy 130 Rs. charges. Chronic disease -
(up to 3 months)-like BP, sugar, Hypertension. During the Audit of Medical Claims, it will be
ensured that the following documents are
attached with the claim

I .OPD Treatment Claim

The bill claim is in duplicate in the prescribed format (MRC(S) 2014) duly filled by the
claimant and countersigned by the Competent Authority All cash memos, receipts in original
Referral slips in the original. In case of photocopy, to be self-attested. If claim includes
consultation charges, self-attested copies of the prescriptions. Photocopy of CGHS Card
(self-attested) of the employee and patient. A detailed list of all medicines, laboratory tests,
investigation, and number of doctor visits, etc. with dates. Original/self-attested copies of
laboratory tests, investigation reports. Joint declaration in case both husband and wife are
Govt. servants.

II In-Patient Treatment Claim in CGHS Empanelled Hospitals

In addition to the documents mentioned at

(1) Under OPD Treatment Claim, Referral slip of CGHS Hospital/dispensary/Wellness

Centre in which the admission was mentioned. Discharge Summary, in original. In case
of implant (such as stents, rods, etc, if used as part of the treatment) Tax invoice in
original with sticker and outer pouch is required

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 IPD:
An inpatient department or IPD is a unit of a hospital or a healthcare facility where
patients are admitted for medical conditions that require appropriate care and attention. A
Government servant shall be entitled, free of charge to medical attendance by the
authorized medical attendant. Where a Government servant is entitled under free of
charge, to receive medical attendance, any amount paid by him on account of such
medical attendance shall,on the production of a certificate in writing by the authorized
medical attendant in this behalf be reimbursed to him by the Central Government.

For covid package :

Covid case RATE PPE (IN RS)

Charges for routine ward + 4000/- 600/- or less
isolation
Charges for ICU without 7500/- 1200/- or less
ventilator + isolation
Charges for ICU with ventilator 9000/- 1200/- or less
+ isolation
Covid-19 testing 2200/-or as per rate whichever is less

High end drugs As per rate prescribed (full rate)

CT Scan,MRI To be charged as per hospital rates

• CASH MEMO & BILLS (In the case of CSMA): All cash bills have been signed by the
AMA.
• The medicines are purchased from the pharmacy which is having a valid drug license for
selling the medicine.
• The GST Number is printed on the bills.
• The entries in the bills are not corrected after signature by the doctor

MEDICAL ADVANCE:

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CEA (Children Education Allowance)

32
Eligibility Criteria :
Applicable to all Central Government servants without any pay-limit including State
Government servants on deputation to Central Government, industrial employees of Central
Government, and Civilian Order.

1) Employees paid from Defence Estimates; also applicable to Government servants

on deputation to State Governments or on foreign service, if provisions are made in
the terms of deputation or foreign service.
2) Child means employee's child (including step/adopted child) wholly dependent on
the Government servant.
3) Recognized School. The assistance is admissible only if the children
study in a recognized school.
4) If both husband and wife are employed If both are Central Government servants,
assistance will be admissible to one of them only.
5) Nursery to 12th school going children Applicable
6) The amount for R of CEA will be Rs. 2,250 per month (fixed) per child,
irrespective of actual expenses incurred by government Servant.
7) Rate of CEA with effect from 1-7-2017

COMPONENT RATE

CEA RS 2,250 PM

Hostel Subsidy RS 6,750 PM

• Whenever DA increases by 50% CEA & Hostel Subsidy Shall increase by

25%
Day boarding are not eligible to draw Hostel Subsidy
• In case of death of government servant in service, CEA/HS is payable The age
limit for claiming CEA for children other than a disabled child is 20 yrs.12th
pass
class

33
• For physically /mentally handicapped children Studying in any institution, i.e.
aided or approved by central/state/UT or whose fees are approved by any of
these authorities, CEA paid is reimbursable irrespective of whether the
institution is recognized or not and benefits will be up to 22 yrs.
• For divyang children, reimbursement will be at double the normal rates.
• Annual ceiling for R of CEA for differently Able children is fixed for to
rs.54,000
• Reimbursement will be done once a year, after completion of the financial
year.
The limits of CEA is rs.27,000 & Hostel subsidy is Rs.81,000 & will be
automatically raised by 25% every time DA goes up to 50%

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SALARY :

Salary includes all kinds of pay, DA, Overtime Allowance, Bonus, Leave Salary, Advance Of
Pay, Compensatory Allowance, Transport

DA is given 2 times every year that also includes BASIC + DA + HRA + TRAVELLING
ALLOWANCE

Example : BASIC + DA + HRA + TA

50,000 + 27% + 13500 + 3600 = 82600

Meaning of salary :
Salary includes all kinds of pay, DA, Overtime
allowance, bonus, leave salary, the advance of pay, compensatory allowance, transport
allowance.

Filing of return.- Every person whose taxable income exceeds the maximum amount which
is not chargeable to tax has to file a return with the Income Tax Officer in the appropriate
form including the income from other heads.

Tax deduction at source. Every employer should deduct income tax at source in monthly
installments on the salaries disbursed by him, the final adjustment is made from the last
salary payable before the end of March. For this, the employer has to take into account only
the income under "Salaries" excepting cases where additional income is permitted to be taken
into account, purpose, like income from house property.

35
CHEQUE SLIP:

PUNCHING MEDIUM:

36
Income Tax Rates/slabof 2021-22:

New Tax Regime u/s

Existing Tax Regime
115BAC

Income
Income Income
Income Tax Rate Tax
Tax Slab Tax Rate
Slab

Up to ₹ Up to ₹
Nil Nil
2,50,000 2,50,000

₹
5% above
₹ 2,50,001 - 2,50,001 -
5% above ₹ 2,50,000 ₹
₹ 5,00,000 ₹
2,50,000
5,00,000

₹ ₹ 12,500
₹ 5,00,001 - ₹ 12,500 + 20% above ₹ 5,00,001 - + 10%
₹ 10,00,000 5,00,000 ₹ above ₹
7,50,000 5,00,000

₹ ₹ 37,500
Above ₹ ₹ 1,12,500 + 30% above ₹ 7,50,001 - + 15%
10,00,000 10,00,000 ₹ above ₹
10,00,000 7,50,000

₹ ₹ 75,000
10,00,001 + 20%

37
 New Tax Regime u/s
Existing Tax Regime
115BAC

Income
Income Income
Income Tax Rate Tax
Tax Slab Tax Rate
Slab

-₹ above ₹
12,50,000 10,00,000

₹
₹
1,25,000
12,50,001
+ 25%
-₹
above ₹
15,00,000
12,50,000

₹
1,87,500
Above ₹
+ 30%
15,00,000
above ₹
15,00,000

Overall Observations Of IE`s Earnings,Expenditure, &Net Payables

38
 % Distribution

Net payables of IE`s 31.04%

Gross deductions of IE`s 28.95%

Gross earnings of IE`s 100%

0.00% 20% 40% 60% 80% 100%

120%

Observations from statement of earnings of IE`s for FY2020-21

% Distribution of Wages Earnings of IE`s for Apr

21

Basic Pay
DA
HRA
EL wages
OT
NPS
Conc All
Others

IE : Industrial employee DA: Dearness Allowance

39
HRA: House rent allowance EL: Earned Leave

NPS: National pension scheme Conv. All: Convenience allowance

Retirement Bills of IE's:

CGEGIS claim:
1. Central govt. Employees group insurance scheme: -Here-in-after referred to as the scheme
was notified on 1st November 1980 and came into force with effect from the forenoon of 1
January 1982.

Objective:
2. The scheme is intended to provide for the central govt. Employees, at a low cost and on a
wholly contributory and self-financing basis, the twin benefits of an insurance cover to help
their Families in the event of death in service and a lump-sum payment to augment
theirresources on retirement.
Application:
3. The 'scheme' shall apply to all central govt. Servants Including those in the railways, posts,
and telegraphs, and defense except members of the armed and para-military forces who have
Already separate schemes of their own. Contract employees, Persons on deputation from state
govt.. public sector Undertakings or other autonomous organizations locally recruited Staff in
the Indian mission's abroad, casual labour, part-time and ad-hoc employees will not be
covered by the 'scheme'.
The government has issued the Table of Benefits for the Savings Fund to the
beneficiariesunder the CGEGIS 1980 for the quarter from July to September, on an interest
rate of 7.1 percent compounded quarterly.

40
Learning From The Project

41
  The time limit for drawel of LTC advance is 125 days (i.e 4 months and 5 days) in case
of journey by train) and for      air/sea/road, the time limit for drawing LTC advance is
65 days only
 Leave Travel Concession is a benefit offered to salaried employees thathelps them
travel domestically. The LTC benefits are provided to employees for two trips in four
years block
 Due to covid pandemic the special cash package scheme was introduced for the
employees on behalf of LTC
 There is a difference between government and private sectors working process
 Got to know the Beneficiary Schemes like LTC, MEDICAL, CEA, SCP, PENSION,
CEA are provided to employees
 Pay audit to look after overall work of NIE, NGO`S and labour section look after
overall work of IE`s  i.e salary, pay fixation, medical bills, and all the beneficiary
schemes
 To show the actual difference between government and private sectors working process
 If any employee of the factory claims because of the time consuming process he/she has
to wait for many days to get the benefit of the claim.

42
Contribution To The Organization

43
I was assigned the task by the guide in the organization
to have a walkthrough of the sections involved in the pay audit and labour section
suggest my opinions by finding the drawbacks. I contributed by suggesting a few of
my opinions which I found that needs to be improved.

i. Less paperwork is required and an increase in software update based on working

ii. Specific order of bills should be passed with a particular number till the end process
iii. Some processes can be done in the system and can be uploaded online for
convenience
iv. More varients and updating should be done in the software in the pay audit and labour
section

44
Manufacturing account:

S.NO Particulars 2017-18 2018-19 2019-20 2020-20

1 Direct labour 154.13 151.96 150.46 133.96

2 Direct 441.82 279.95 237.55 213.98

material
3 Fixed 298.82 330.46 329.11 349.18
overhead
4 Variable 91.37 96.11 96.11 82.79
overhead
5 Total 986.14 858.48 813.23 779.91
expenditure

Quantitative analysis of AFK

Cost heads Value(per unit) % of the cost Value (per unit) % of the cost of
for FY 19-20 of the for FY 20-21 the product
product
Material cost 11.7 34.31% 12.28 34.17%
Labour cost 5.38 15.78% 2.76 16.03%
VOH 2.39 7.01% 2.51 6.98%
FOH 12.55 36.80% 13.18 36.67%
Packing cost 1.68 4.93% 1.8 5.01%
Direct expense 0.4 1.17% 0.41 1.14%
Total cost (per 34.1 35.94
unit)

Notable features of this year's account:

The Revised reduced Target has been achieved by proper booking of expenditure and issue
values. There was good synergy between AFK Factory management and Accounts Office

45
which needs to be maintained with a positive approach. The hurdles can be overcome and a
better picture can emerge on the horizon for AFK in the future.

Bibliography
• https://cgda.nic.in/index.php
• https://Ims.gem.gov.in/
• https://munitionsindia.co.in/?page_id=4664
• http://ddpdoo.gov.in/pages/history
• https://en.m.wikipedia.org/wiki/Ordnance_Factory_Board

• Office Manuals
• Reference books

46