From UPSC perspective, the following things are important :
Prelims level: Finance Bill
Why in the News?
Initiating the debate on the Finance Bill in the Lok Sabha, Shashi Tharoor said south Indian States have been the engines of growth and revenue but don’t get their due share from the Central pool of revenue.
About Financial Bills:
- Article 117 of the Constitution governs financial bills. It stipulates special provisions for the introduction of financial bills, outlining their requirements and procedures.
- According to Rule 219 of the Rules of Procedure of the Lok Sabha, a Finance Bill is typically introduced to give effect to the financial proposals for the next financial year or to address supplementary financial proposals.
- A Finance Bill is introduced in the Lok Sabha after the annual budget has been presented.
- The Bill does not include provisions as per Article 110 but still involves expenditure from the Consolidated Fund of India.
- It follows the same legislative process as an ordinary bill, where:
- Rajya Sabha can reject or amend it.
- In case of a deadlock, a joint sitting of both Houses may be convened.
- The President can either assent to the Bill or return it for reconsideration.
- All money bills are financial bills, but not all financial bills are money bills.
- Only bills that exclusively deal with matters listed in Article 110 (such as taxes, borrowing, or the management of Consolidated Fund of India ) qualify as money bills.
Types of Financial Bills:
- Type-I: Financial Bills under Article 110
- These bills contain provisions related to matters specified in Article 110(1)(a) to (f), which include taxation, borrowing, and the expenditure of funds from the Consolidated Fund of India (CFI).
- These bills are a combination of both money bills and ordinary bills. They are treated like money bills but also include non-financial matters that do not strictly fit into Article 110.
- Type-II: Financial Bills under Article 117(3)
- These bills involve expenditure from the Consolidated Fund of India but do not fall under the money bill category.
- They follow the same legislative procedure as an ordinary bill and may be amended or rejected by the Rajya Sabha. In the case of disagreement between the two Houses, the President can call a joint sitting to resolve the deadlock.
| [UPSC 2022] With reference to Finance Bill and Money Bill in the Indian Parliament, consider the following statements:
1. When the Lok Sabha transmits Finance Bill to the Rajya Sabha, it can amend or reject the Bill. 2. When the Lok Sabha transmits Money Bill to the Rajya Sabha, it cannot amend or reject the Bill, it can only make recommendations. 3. In the case of disagreement between the Lok Sabha and the Rajya Sabha, there is no joint sitting for Money Bill, but a joint sitting becomes necessary for Finance Bill. How many of the above statements are correct? (a) Only one (b) Only two (c) All three (d) None |
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