Note4Students

From UPSC perspective, the following things are important :

Prelims level: Money Bills and Financial Bills and related provisions and procedure

Mains level: Money Bills and Financial Bills debate and Supreme Court in interpretations

What’s the news?

The recent discussions over the Digital Personal Data Protection (DPDP) Bill have brought to light an important constitutional question – Is it a Money Bill or an Ordinary Bill? The distinction between these two types of bills holds significant implications for the legislative process and decision-making.

Central Idea

In a recent statement, Parliamentary Affairs Minister Pralhad Joshi clarified that the DPDP Bill is a regular Bill and not a Money Bill. This clarification comes against the backdrop of earlier reports suggesting that the Bill was being introduced under Article 117 of the Constitution, which deals with special provisions for Finance Bills.

Definition: A Finance Bill is a type of Financial Bill that relates to revenue or expenditure matters.
Money Bill Criteria: A Finance Bill becomes a Money Bill when it exclusively deals with matters specified in Article 110(1)(a) to (g) of the Constitution.

Category 1: Financial Bills related to Article 110(1)(a) to (f):
- Introduced or moved only on the President’s recommendation.
- Cannot be introduced in the Rajya Sabha.
- Examples: Money Bills and other Financial Bills originating solely in the Lok Sabha.
Category 2: Financial Bills related to other matters (Article 110(1)(g)):
- Similar to ordinary Bills.
- Require the President’s recommendation if they involve expenditure from the Consolidated Fund of India.
- It can be introduced in the Rajya Sabha, amended by it, or deliberated by both Houses in a joint sitting.

Exclusivity: A Money Bill must exclusively deal with matters specified in Article 110(1)(a) to (g).
Certification: A Money Bill must be certified by the Speaker.

Introduction: Must be introduced only in the Lok Sabha and not in the Rajya Sabha, as per Article 117(1) of the Constitution.
President’s Recommendation: Can only be introduced on the President’s recommendation, as per Article 117(1) of the Constitution.

Scope: Finance Bills cover general revenue and expenditure matters, while Money Bills exclusively address specific matters listed in Article 110(1)(a) to (g).
Introduction: Finance Bills can be introduced in either House, but Money Bills can only be introduced in the Lok Sabha.
President’s Recommendation: Finance Bills require the President’s recommendation if they involve expenditure, while Money Bills always require the President’s recommendation.
Rajya Sabha’s Role: The Rajya Sabha can discuss and recommend amendments for Finance Bills, but its role is limited for Money Bills. The Lok Sabha can reject the Rajya Sabha’s recommendations for Money Bills.

2017 Finance Act:
In November 2019, a Constitution Bench of the Supreme Court, headed by the then Chief Justice of India, Ranjan Gogoi, struck down amendments to the 2017 Finance Act passed as a Money Bill.
The court directed the formulation of fresh norms for appointing tribunal members and raised questions about the correct interpretation of Article 110. The matter was referred to a seven-judge bench.
2016 Aadhaar Act:
The Supreme Court also expressed doubts over its 2018 verdict upholding the 2016 Aadhaar Act, which was passed as a Money Bill.
Review petitions regarding the Aadhaar Act are still pending before the court.

The distinction between Money Bills and Financial Bills is essential for understanding the legislative process and the powers of the two Houses of Parliament. The role of the Supreme Court in interpreting and upholding the constitutional validity of various Bills remains critical to ensuring a robust and accountable legislative framework.