Central Idea

The debate surrounding the classification of the Digital Personal Data Protection (DPDP) Bill as a Money Bill and its implications has sparked discussions on the nuances of Money Bills and Financial Bills in India’s parliamentary process.

Money Bills vs. Financial Bills

	Money Bills	Financial Bills
Definition and Scope	Article 110 – Deals with taxes, government borrowing, expenditure, receipt of money from the Consolidated Fund of India, among others.	Broader scope beyond Article 110(1)
Rajya Sabha’s Role	Introduced only in Lok Sabha, no Rajya Sabha approval needed Lok Sabha has the discretion to accept or reject any recommendations made by the Rajya Sabha on a Money Bill.	Can be introduced in either house, requires approval from both houses.
Origin and President’s Recommendation	Must be introduced only in Lok Sabha, and the President’s recommendation is required for its introduction.	Can be introduced in either house, no President’s recommendation needed.
Passage Procedure	Passed by Lok Sabha, sent to Rajya Sabha for recommendations within 14 days. Rajya Sabha’s recommendations are not binding. If rejected by Lok Sabha, the Bill is considered passed without Rajya Sabha’s concurrence.	Require agreement of both houses for passage, subject to Rajya Sabha amendments or rejections.

Striking Down Amendments: In Nov 2019, a five-judge Constitution Bench, headed by the then CJI Ranjan Gogoi, struck down amendments to the 2017 Finance Act, passed as a Money Bill. The court found the amendments altering the structure and functioning of various tribunals contrary to constitutional principles.
Referring the Matter: The court referred the issue of whether these amendments could have been passed as a Money Bill to a seven-judge bench for consideration, indicating the complexity of the matter.
Doubts Over Aadhaar Act: The same Constitution Bench expressed doubts about the correctness of the 2018 verdict upholding the 2016 Aadhaar Act, which was also passed as a Money Bill. This matter is yet to be conclusively settled, as petitions seeking a review of the Aadhaar Act ruling remain pending in the Supreme Court.

The distinction between Money Bills and Financial Bills is crucial in India’s parliamentary process, as it determines the extent of Rajya Sabha’s role and the passage procedure.
While Money Bills have limited Rajya Sabha involvement and cannot be amended or rejected by it, other Financial Bills and ordinary Bills require the agreement of both houses for passage.
The Supreme Court’s perspective on the correct classification of certain Bills as Money Bills adds further complexity to the debate, underscoring the need for a comprehensive understanding of these constitutional provisions.