Money Bill vs Financial Bill
Notes
Money Bill (Art. 110): A Bill is a Money Bill if it contains only provisions dealing with:
- (a) imposition, abolition, remission, alteration or regulation of any tax;
- (b) regulation of borrowing by the Government;
- (c) custody of the Consolidated Fund of India (CFI) or Contingency Fund, payment into or withdrawal from them;
- (d) appropriation of money out of the CFI;
- (e) declaring any expenditure to be charged on the CFI, or increasing its amount;
- (f) receipt of money on account of the CFI or Public Account, or their custody, issue and audit;
- (g) any matter incidental to (a) to (f).
- A Bill is not a Money Bill merely because it deals with fines or penalties, fees for licences or services, or taxes levied by local authorities.
- The Speaker's certificate is final (Art. 110(3)). Questions about it cannot be raised in any court or in the House.
Procedure for Money Bills (Art. 109)
- Introduced only in the Lok Sabha, on the recommendation of the President.
- After passage, sent to the Rajya Sabha, which must return it within 14 days with recommendations. The Lok Sabha may accept or reject them. If the Rajya Sabha does not return it in 14 days, it is deemed passed.
- No joint sitting is called. The President can give or withhold assent but cannot return it.
- The Rajya Sabha can neither amend nor reject it.
Financial Bill (Art. 117)
- Category I (Art. 117(1)): contains provisions of Art. 110(a)-(f) and also other matters. Introduced only in the Lok Sabha on the President's recommendation, but the Rajya Sabha has full powers to amend or reject it, and a joint sitting is possible.
- Category II (Art. 117(3)): contains provisions involving expenditure from the CFI but none of the Art. 110 matters. Can be introduced in either House; the President's recommendation is required for consideration, not introduction. Treated like an ordinary Bill.
Basis | Money Bill | Financial Bill |
|---|---|---|
Definition | Art. 110 | Art. 117 |
Where introduced | Lok Sabha only | Category I: Lok Sabha only; Category II: either House |
Certification | Speaker | None |
Rajya Sabha power | Recommend only (14 days) | Full powers (Category I and II) |
Joint sitting | Not applicable | Applicable |
President | Cannot return | Can return |
Judicial point: In the Aadhaar Act, 2016 case (K.S. Puttaswamy v Union of India, 2018), the Supreme Court upheld, by 4:1, the Speaker's certification of the Aadhaar Act as a Money Bill (Justice Chandrachud dissented). In Rojer Mathew v South Indian Bank (2019), the question of the scope of judicial review of the Speaker's certificate was referred to a larger bench.
Key Points
- Money Bill: Art. 110; Speaker certifies; only Lok Sabha; RS has 14 days.
- Financial Bill Category I (Art. 117(1)): Lok Sabha only, but RS has full powers.
- Financial Bill Category II (Art. 117(3)): either House; President's recommendation for consideration.
- All Money Bills are Financial Bills, but not vice versa.
- No joint sitting for Money Bills.
MCQs
Q1. The question whether a Bill is a Money Bill is decided by: (a) President (b) Speaker of Lok Sabha (c) Supreme Court (d) Finance Minister Ans: (b). Art. 110(3).
Q2. The Rajya Sabha must return a Money Bill to the Lok Sabha within: (a) 7 days (b) 14 days (c) 30 days (d) 60 days Ans: (b).
Q3. Which of the following can be introduced in either House of Parliament? (a) Money Bill (b) Financial Bill Category I (c) Financial Bill Category II (d) Appropriation Bill Ans: (c).