Money bill

Money bill

Subject: Polity

Context: The Congress party in a pre-emptive move has written to the Lok Sabha speaker not to certify 7 key bills as money bill as it bypasses the Rajya Sabha

Concept:

Bills in question:

• Bill seeking to replace the University Grants Commission with a Higher Education Commission.
• Amendment to the Fiscal Responsibility and Budget Management Act
• the setting up of a Development Finance Institution
• the introduction of a securities markets code that will merge all market regulatory laws, amendments to
• the Deposit Insurance and Credit Guarantee Corporation Act
• Amendments to pave way for the initial public offering of LIC
• The privatization of two public sector banks

About money bill

A Bill is said to be a Money Bill under article 110 of the constitution if it only contains provisions related to taxation, borrowing of money by the government, expenditure from or receipt to the Consolidated Fund of India.

Qualification as money bill:

1. Under Article 110(1) of the Constitution, a Bill is deemed to be a Money Bill if it contains only provisions dealing with all or any of the following matters:
   the imposition, abolition, remission, alteration or regulation of any tax
2. regulation of borrowing by the government
3. custody of the Consolidated Fund or Contingency Fund of India, and payments into or withdrawals from these Funds
4. appropriation of moneys out of the Consolidated Fund of India
5. declaring of any expenditure to be expenditure charged on the Consolidated Fund of India or the increasing of the amount of any such expenditure
6. receipt of money on account of the Consolidated Fund of India or the public account of India or the custody or issue of such money or the audit of the accounts of the Union or of a State
7. any matter incidental to any of the matters specified in sub-clauses (a) to (f).

Power to decide money bill

• The speaker of the Lok Sabha decides if a bill is money bill or not (Art 110 (3)) and his decision in this regard is final.

Power of Rajya Sabha w.r.t Money Bill

• Under Article 109 (1), a Money Bill cannot be introduced in Rajya Sabha.
• Once passed by Lok Sabha, it is sent to Rajya Sabha — along with the Speaker’s certificate that it is a Money Bill — for its recommendations.
• However, Rajya Sabha can neither reject nor amend the Bill, and must return it within 14 days, after which Lok Sabha may choose to accept or reject all or any of its recommendations.
• In either case, the Bill is deemed to have been passed by both Houses.
• Under Article 109(5), if Rajya Sabha fails to return the Bill to Lok Sabha within 14 days, it is deemed to have been passed anyway.