DFPR 2024·Rules 18–19·11 min read·Updated 2026-07-05

Delegation of Financial Powers Rules 2024 — Rules 18 and 19, Trading Operations and Dismantlement of Public Buildings

Two rules that rarely come up in day-to-day files but matter enormously when they do: how proposals involving Government trading and commodity pricing must route through the Finance Ministry, and the strict conditions under which a public building may be pulled down.

Swarnim Tripathi Written by Swarnim Tripathi · Reviewed by a serving CSS Officer

1. Trading Operations Requiring Finance Ministry Concurrence (Rule 18)

Rule 18 requires that, notwithstanding anything else in DFPR 2024, three categories of proposals must be referred to the Ministry of Finance for concurrence before approval:

Purchase of commodities not intended for Government’s own consumption, but meant for sale or issue to the public, State Governments, or any other agency.
Fixing prices for Government’s own direct trading operations.
Proposals from Government companies and undertakings referred to Government for fixation of prices of their products or stocks.

“Government Company” here carries the same meaning as under the Companies Act, 2013. A useful exception exists: proposals under the first two categories need not be referred to the Finance Ministry if the value of the transaction is below ₹25 crore. This threshold means routine, smaller-scale trading transactions can move faster, while larger transactions — where pricing errors or market distortions could have significant fiscal consequences — retain central financial oversight.

2. Dismantlement of Public Buildings — The Four Conditions (Rule 19)

Departments and Administrators have full power to sanction dismantlement of public buildings (other than purely temporary structures), but only with the concurrence of the Chief Financial Adviser, and subject to four conditions:

No building may be dismantled unless it has first been ascertained that no other Department of the Government of India requires it.
No building may be demolished unless it is structurally dangerous, beyond economic repair (certified by an appropriate technical authority), or vacating the site is necessary to construct a more important Government building or structure.
Once dismantlement is sanctioned, the building must be disposed of by public auction through the Central Public Works Department (or the local PWD where CPWD does not operate) — unless specific prior Competent Authority approval has been taken to dispose of it to an identified party instead.
Purely temporary structures — defined as structures with a life of not more than two years — can be dismantled under full departmental power, without these additional conditions applying.

The logic mirrors GFR’s broader principle of financial propriety: before Government destroys or disposes of an asset, it must first confirm the asset is genuinely surplus to Government’s own needs, then justify the demolition on structural or strategic grounds, and finally ensure the disposal itself follows a transparent, auction-based process rather than a discretionary handover.

Frequently Asked Questions (FAQ)

Q1. When must a Government trading proposal be referred to the Finance Ministry?

When it involves purchase of commodities not for Government's own consumption but for sale/issue to the public, State Governments, or another agency, or fixing prices for Government's direct trading operations, or price-fixation proposals from Government companies — unless the transaction value is below ₹25 crore for the first two categories.

Q2. Is there a monetary threshold below which trading proposals need not go to the Finance Ministry?

Yes. Proposals under clauses (a) and (b) of Rule 18 — commodity purchase for resale and price-fixation for direct trading — need not be referred if the transaction value is below ₹25 crore.

Q3. What does 'Government Company' mean under Rule 18?

It carries the same meaning assigned to it under the Companies Act, 2013 (18 of 2013).

Q4. Can a public building be demolished simply because a Department finds it inconvenient?

No. Under Rule 19, demolition is permitted only if the building is structurally dangerous, beyond economic repair as certified by a technical authority, or the site is needed for a more important Government building or structure.

Q5. Must it be confirmed that no other Department needs a building before it is dismantled?

Yes. Rule 19(i) requires it be previously ascertained that the building is not required by any other Department of the Government of India before dismantlement is sanctioned.

Q6. How must a dismantled public building be disposed of?

By public auction through the Central Public Works Department, or the local PWD in areas where CPWD does not operate, unless specific prior Competent Authority approval has been obtained to dispose of it to an identified party.

Q7. Whose concurrence is required to sanction dismantlement of a public building?

The concurrence of the Chief Financial Adviser is required, in addition to satisfying the conditions in Rule 19.

Q8. What is a 'purely temporary structure' under Rule 19?

A structure whose life is not more than two years, as per the Explanation to Rule 19; such structures can be dismantled under full departmental power without the other conditions applying.

Q9. Does GFR 2017 also apply to disposal of dismantled building material?

Yes, the disposal process (public auction through CPWD/PWD) works alongside GFR's broader disposal-of-surplus-assets principles, ensuring transparency in how the resulting material or site is handled.

Q10. Can a Government company set its own product prices without reference to the Finance Ministry?

Not where the matter has been referred to Government for price fixation of its products or stocks — such proposals must go to the Ministry of Finance for concurrence before approval, per Rule 18(c).